December 18, 2003

BIRMINGHAM, AL — Vista Engineering Inc. has received a two-year, $500,000 Phase II Small Business Innovation Research (SBIR) grant to develop large-scale coating methods for nanostructured diamond-coated cutting tools used by the automotive industry. The current market for these tools is approximately $780 million.

A nanostructured diamond coating, when applied to cutting instruments, creates the hardest, smoothest option in wear surfaces and cutting tools, including drills, end mills and inserts. The cutting tool industry has specific applications that require a super smooth and extremely hard surface on the cutting edge, especially for cutting aluminum-based metals.

“This technology is of great interest to the automotive industry because cutting tools coated with nanostructure diamonds can last up to 100 times longer than those currently available,” said Raymond Thompson, Ph.D., P.E., president and CEO of Vista. “This fundamentally changes the market for cutting tools because it creates a new product that can save the end users 50 percent of current tool cost and create a 30 percent increase in profits for tool manufacturers, while creating $50 million in annual profits for the diamond-coated tool industry. This grant allows us to enter into a new product market to complement our existing engineering and scientific services.”

In addition to developing large-scale coating methods, the grant allows Vista to hire two new scientists to work on the project and to make some major equipment purchases. Included in the equipment purchase is a 30-kilowatt chemical vapor deposition microwave plasma reactor, which is required for larger-scale diamond film production. There is only one other machine of this scale in the United States.

Vista has an exclusive license for the nanostructured diamond-coated cutting tool technology from the University of Alabama at Birmingham (UAB) Research Foundation. UAB University Scholar and physics professor Yogesh K. Vohra, Ph.D., developed the technology. He patented a process in May 1997 to grow nanostructured synthetic diamonds by combining methane and hydrogen gases with high-powered microwaves. In February 2001, Vohra and UAB researcher Shane Aaron Catledge were issued a patent for the process they developed that produces a smooth nanostructured diamond film that can be deposited on metals.

In addition to the cutting tool industry, other commercial uses of nanocrystalline diamond coatings include hard-to-finish advanced materials, pulp and paper industries, textiles, deep-well oil drilling, environmental sensors and biomedical applications.

This is the third SBIR grant Vista has received. The first two grants, totaling $200,000, were for feasibility testing of the diamond-coated cutting tool project. This new grant is designed to help Vista further its research and create a marketable product. In addition, if the company raises $100,000 from outside investors, the grant provides for an additional $100,000 in matching funds. SBIR grants are awarded on a competitive basis to companies whose projects are judged in a peer-review process to demonstrate strong scientific merit and commercial potential. They are funded by the U.S. Small Business Administration and administered by the National Science Foundation.

About Vista Engineering

Vista Engineering Inc., founded in 1998, is based in Birmingham, Alabama, and is a privately held engineering services company. It is housed in UAB’s high-tech business incubator OADI. Vista is dedicated to the creation of innovative, cost-effective solutions for materials design and manufacturing. Vista’s core competencies are engineering, physical metallurgy, surface science and manufacturing processes. Vista’s engineering services include metallurgical and mechanics analysis for major utility companies. Its consulting services include failure analysis and manufacturing process analysis for manufacturing, intellectual property assessment, and product liability litigation. Additional information is available at www.vistaeng.com.

About OADI

The University of Alabama at Birmingham (UAB) Office for the Advancement of Developing Industries (OADI) is the university's 16-year-old high tech incubator. OADI is housed in the 67,000-square-foot OADI Technology Center, the first building in the 100-acre UAB Research Park at Oxmoor Valley, which will eventually house 25 buildings of office and laboratory space for use by high-tech research and development companies. Tenants include advanced biotechnology, biomedical, computer and pharmaceutical entrepreneurs.

About the UAB Research Foundation

The UAB Research Foundation (UABRF) was formed in 1987 as a nonprofit corporation with a mission to identify, assess, and market commercially viable technology developed at the University of Alabama at Birmingham (UAB). The Research Foundation is the assignee of all intellectual property developed at UAB. The foundation reviews invention disclosures submitted at UAB and initiates domestic and foreign patent filings when appropriate. It negotiates, manages and monitors research, option and licensing agreements with outside parties on behalf of UAB. As UAB has grown into a top tier research university in recent years — with $369 million in annual extramural research and development funding — the UAB Research Foundation has grown as well. The Research Foundation has more than 175 option/license agreements with large and small corporations around the world.