City of Gwangju Provides iQ Power Asia Industrial Site to Build its Manufacturing Plant

SEOUL, South Korea and ZUG, Switzerland, August 11 -- The Korea Industrial Complex Corporation, acting on behalf of the Korean city of Gwangju, recently provided the Korean company iQ POWER Asia Inc., in which the Swiss iQ POWER AG holds a 40-percent equity stake, an industrial site on which to build its own manufacturing plant. The piece of land provided, which is completely developed, boasts an area of more than 36,300 square meters and is situated within the Pyeongdong Industrial Park's "Foreign Investment Zone" in the South Korean high-tech metropolitan area of Gwangju. The city of Gwangju and the iQ POWER Asia Inc. and iQ POWER AG companies had signed the related memorandum of understanding in Munich on 9 May.

iQ POWER Asia Inc. intends to manufacture innovative electrical-energy storage systems for the Korean automobile industry in the plant that is to be built on the site. The foundation for this is the technology that iQ POWER has developed. Construction of the plant is set to begin in fall 2005 with completion planned for the end of 2006. iQ POWER Asia Inc. will be investing a total of some $12 million in the property over the coming three years.

The terms for the entrusted commercial property are very liberal and amount to an equivalent leasing fee of some $1,800 per month. The agreement has a 50-year term and ends in August 2055. As long as iQ POWER Asia Inc. wants an extension of the contract, the contract will be automatically renewed for another 10 years.

The prerequisite for such a generous transfer of this property was iQ POWER Asia Inc.'s recently recognized status as a foreign invested enterprise (FIE), which the Foreign Exchange Bank awarded it on behalf of the Korean Ministry of Economics, Industry and Energy. As was reported a week ago, iQ POWER AG had earlier completed its acquisition of 40% of the equity in the newly founded iQ POWER Asia Inc. company.

Meanwhile, the design and planning for construction of the future manufacturing plant are already underway. "Preparations are moving at full speed," emphasized Tae Soo Lee, Managing Director of iQ POWER Asia Inc. in Seoul. The city of Gwangju is promoting this project through both its progressive policies toward welcoming and establishing industry and the kind of attractive support it affords in terms of infrastructure and administration.

About iQ Power AG

iQ Power AG specializes in the development and marketing of intelligent systems solutions for electrical energy management (Smart Energy Management, SEM) in the power and wiring systems of automobiles and other forms of transportation. Headquartered in Zug/Switzerland, the company's numerous achievements include the world's first software-managed, intelligent car battery. The development unit is iQ Power Deutschland GmbH of Munich, a wholly owned subsidiary of iQ Power AG. iQ Power AG is a publicly listed stock corporation (ISIN: CH0020609688), whose shares are traded on the Nasdaq OTC-BB (IQPOF), over the counter on the Frankfurt and Berlin Stock Exchanges, as well as on XETRA (IQPB, WKN: A0DQVL). - Please visit www.iqpower.com.

    
    Further Information:

    Peter E. Braun,
    President of the iQ Power AG Board of Directors,
    Tel +49-(0)89-61-44-83-10,
    Fax +49-(0)89-61-44-83-40,
    E-Mail: peter.braun@iqpower.com

Further Information: Peter E. Braun, President of the iQ Power AG Board of Directors, Tel +49-(0)89-61-44-83-10, Fax +49-(0)89-61-44-83-40, E-Mail: peter.braun@iqpower.com