Universal Automotive Industries, Inc. Closes $2.8M Equity Investment

    ALSIP, Ill., Aug. 30 Universal Automotive Industries, Inc.
today announced that yesterday it closed a definitive agreement
("Agreement") with an affiliate of Wanxiang America Corporation and has issued
$2,800,000 of Series A Preferred Stock, convertible into 2,014,380 shares of
Common Stock, subject to standard weighted average antidilution protection,
and representing approximately 20% of the Company's capital stock on a post-
closing basis.  The other principal terms of the Agreement were detailed in
the Company's press release dated August 23, 2001, announcing the parties'
intent to execute and close the Agreement.  According to Universal's CEO,
Arvin Scott, "We are very excited about Wanxiang America having become a major
investor in the Company.  The Wanxiang Agreement provides us with a strategic
partnership with China's largest auto parts manufacturer."

    The Company met on August 17, 2001 with a Delisting Panel authorized by
the NASDAQ Stock Market, Inc., which was convened due to the Company's failure
to maintain net tangible assets of at least $2,000,000 (as of the dates
covered by its most recent Form 10-K and Form 10-Q filings) and its need to
demonstrate an ability to meet this requirement in the future.  The Company's
pro forma net tangible assets as of July 31, 2001, after giving effect to the
Agreement, and before accounting for the associated legal and closing costs
total approximately $3,395,000.  The Wanxiang Agreement contains a "put"
right, enabling Wanxiang to effectively put back its shares for a return of
its funds, and to terminate the various agreements covered by the Wanxiang
Agreement, in the event the Company is unable to demonstrate within 90 days
following closing that NASDAQ has confirmed that the Company has corrected its
net tangible assets deficiency to NASDAQ's satisfaction.  The Company will be
providing formal notice to NASDAQ of the aforesaid equity infusion.  While the
Company believes that this will demonstrate net tangible assets substantially
in excess of the minimum required amounts, the Company cannot presently
determine whether the above actions, without additional equity enhancement,
will cure the net tangible assets deficiency to NASDAQ's satisfaction.