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Mini Me- AutoVision GmbH invests in NanoMuscle Inc.

Antioch, California, May 5 -- NanoMuscle, Inc., a manufacturer of lightweight, silent, miniature motors, received US$2 million investment of its open US$10 million Series C round from AutoVision GmbH, a subsidiary of Volkswagen AG. NanoMuscle will also open its European headquarters in Wolfsburg, Germany where Volkswagen is based.

NanoMuscle is addressing a multi-billion dollar motor market in industries such as children's toys and automotive. NanoMuscle motors are 1/100th the weight and 1/20th the size of comparable motors. Powered by shape memory alloy, NanoMuscle motors provide silent, powerful movement that drastically reduces overall weight, sound and production cost for electrical and mechanical designers. In the automotive industry, NanoMuscle motors are ideal for many applications including comfort seating, instrument clusters and HVAC flaps and grilles. Earlier this year, NanoMuscle announced Playmates Toys as the first high volume consumer of the NanoMuscle motors at the International Toy Fair in New York.

"From a strategic view-point, NanoMuscle is a highly attractive company with the expected return on investment," said Frank Fiedler, chairman of AutoVision GmbH. "AutoVision GmbH gives NanoMuscle access to the worldwide network of the Volkswagen corporation."

"Having an investment partner in Germany such as Volkswagen gives us a tremendous advantage in the European automotive industry," said Rod MacGregor, CEO and founder of NanoMuscle. "We are now working with the major German automotive manufacturers and we hope to see NanoMuscle motors in production cars as early as 2005."

- About AutoVision GmbH

Founded in 2001, AutoVision GmbH is a wholly owned subsidiary of Volkswagen. It has four business units: venture, incubator, people and services. AutoVision GmbH invests in early-stage companies as well as the expansion phases of high-tech companies ranging from the mobility to IT.

- About NanoMuscle

Founded in 1998, privately held NanoMuscle, Inc. manufacturers components that displace small electric motors in high volume markets including the children's toy and automotive industries. The company has been financed by strategic partners around the globe including AutoVision GmbH, a wholly owned subsidiary of Volkswagen, DaimlerChrysler Capital Services, the financial arm of the leading automaker and Jetta Ltd., the world's largest manufacturer of children's toys. NanoMuscle motors are mass manufactured in state-of-the-art facilities by ASE, a leader in semiconductor manufacturing services. .

NanoMuscle(R) is a registered trademark of NanoMuscle, Inc.