American Electromedics Signs Merger Agreement.

AMHERST, N.H.--(BW HealthWire)--May 6, 1998--American Electromedics Corp. (OTCBB:AMER), and its president, Michael T. Pieniazek, announced today that it has acquired by merger Dynamic Dental Systems, Inc., a high-tech dental company based in Gainesville, Ga. The transaction was completed for a purchase price of 750,000 shares of AMER common stock along with a cash payment of $225,000.

Dynamic Dental Systems, Inc. is a premier provider of digital operatory hardware, cosmetic imaging software and intraoral cameras to the domestic dental market. With the recent addition of digital x-ray systems to its line, Dynamic Dental markets three of the most sought after practice-building technologies in dentistry through an experienced national sales force.

Commenting on the merger, Pieniazek, said "The addition of Dynamic Dental to our growing family of companies provides AMER with an accelerated entry into the domestic dental market through its experienced sales force and established customers, and increased our arsenal of premium products. Dentists can now experience 'one-stop shopping' and have a choice of two premium intraoral camera systems based on their particular need. AMER, through its subsidiary Rosch GmbH, has become the European market leader in the sales of intraoral dental camera systems under the Viola(TM) tradename, and Dynamic Dental markets the ViperCam, one of the highest rated cameras in the U.S. The merger of Dynamic Dental and American Electromedics will provide both companies with needed resources and expand market penetration. The Dynamic Dental management staff and sales force will allow AMER to further develop domestic operations as well as provide more products for the overseas market. Together we can combine our marketing efforts and expand our domestic presence. This acquisition now makes us one of the leaders in our industry. As AMER continues to expand its portfolio of products through acquisitions and strategic alliances, Dynamic Dental will further solidify our core businesses and enhance our revenue and profit trends. The combined annualized revenue run rate of both companies approximates $12 million currently, some 500 percent higher than our fiscal 1997 numbers. With combined synergies, anticipated new product introductions, and general industry and market share growth, these numbers are expected to grow significantly in our new fiscal year which begins this August 1st. Dynamic Dental is currently profitable, thereby meeting out most important acquisition discipline of limiting most of our M&A transactions to profitable and accretive companies in which business synergies are enjoyed, management is strong, products are proprietary and the deal valuation is compelling."

American Electromedics Corp. develops, manufactures and markets intraoral dental cameras, related dental products and systems, and diagnostic audiometric medical devices in the United States and worldwide. Under the proven leadership of its new management team, the Company has initiated an aggressive acquisition strategy to complement the existing core business.

The remarks contained in this press release and presented elsewhere by management from time to time contain forward-looking statements which are based largely on the Company's expectations and are subject to various business risks and uncertainties, certain of which are beyond the Company's control. Actual results may differ materially from the results discussed in this press release or in other forward-looking statements presented by management as a result of such risks. In light of these risks and uncertainties, there can be no assurance that the forward-looking statements contained herein will in fact transpire or prove to be accurate. Among the factors that could cause actual results to differ materially include failure of revenue on new products to develop as estimated, regulatory delays, loss of existing customers, the ability to raise additional funds on terms favorable to the Company, general downward trends in the Company's industry, changes in foreign economic conditions or currency fluctuations and other risk factors detailed from time to time in the Company's reports filed with the SEC.

CONTACT: American Electromedics Corp.

Michael T. Pieniazek, 603/880-6300

or

Liviakis Financial Communications, Inc.

John M. Liviakis, 916/448-6084