PRESS RELEASE

G2 Microsystems Receives $1.9 Million (AUD) Grant from Australian Government

Grant to Support the Research and Development of Wi-Fi™ Radio Frequency Identification (RFID) Silicon Technology for the Mobile Resource Management Market

Oakland, Calif. – December 1, 2005 – G2 Microsystems Inc., a developer of integrated circuits for the Mobile Resource Management (MRM) market, today announced that the company has received a $1.9 million (AUD) grant from the Australian Government Industry Research and Development Board. The grant money will further G2 Microsystems’ research and development efforts in the design of ultra low-power, active MRM chips for asset tracking (otherwise known as RFID) and process monitoring applications in the healthcare, automotive, transportation, government, and oil, gas and chemical industries.

The Australian Government Industry Research and Development Board provide grants for up to 50 percent of the cost of commercially focused research and development (R&D) projects conducted in Australia. The government awards grants to companies in numerous different categories and bases their selection on the company’s management capability and technical strengths, and the project’s commercial potential and its level of national benefit to Australia, i.e., export income and increased employment. G2 Microsystems’ application was accepted over numerous other applications submitted by other companies.

G2 Microsystems is an Australian-based start-up company with corporate headquarters in the United States. The company is focused on developing integrated circ uits for MRM solutions, which is a combination of hardware and software that monitors, tracks and manages assets either within a facility or throughout a supply chain. An important element of an MRM solution is the tag, which is attached to the asset (inventory, people, or livestock) or process being monitored. G2 Microsystems is developing a fully-functional prototype active tag. Differing from current proprietary tags, G2 Microsystems’ tag technology leverages the widely-deployed Wi-Fi (IEEE 802.11) network infrastructure, consumes significantly less power, and integrates an intelligent set of features for location tracking and the monitoring of environmental conditions, including temperature and security. The combination for these capabilities in a single chip solution will significantly lower the Total Cost Ownership and expand the applications for asset tracking and process monitoring.

“Our vision as a company is to be the leader in integrated circuits that deliver ultra low-power, high functionality, small size, and low Total Cost of Ownership for companies to monitor assets or processes anywhere in the world,” said John Gloekler, Chief Executive Officer and President of G2 Microsystems. “The grant that the Australian government has given to us will assist G2 Microsystems in commercializing Wi-Fi active tag products, which we believe is a disruptive technology that will enable more organizations to reap the productivity benefits of location base services and wireless sensors .”

According to the Australian Government Industry Research and Development Board, “G2 Microsystems’ technology is expected to grow into a large export market for Australia. Further more; we believe this technology provides opportunities for Australian companies developing advanced products for monitoring items as diverse as shipping containers, irrigation and patient monitors.”

About G2 Microsystems

G2 Microsystems designs and markets low-power, active MRM system-on-chips (SoCs) that provide ubiquitous asset tracking and telemetry solutions leveraging existing wireless IEEE 802.11 network infrastructures. Our SoCs significantly reduce the Total Cost of Ownership of deploying sophisticated LBS or asset tracking services so that businesses can more efficiently manage their mobile resources.

G2 Microsystems is a privately-held semiconductor company. Major investors in the company include UPS Strategic Enterprise Fund, Starfish Ventures and DB Capital Partners, the private equity and venture capital arm of Deutsche Asset Management (Australia) Ltd. G2 Microsystems can be contacted at their US corporate headquarters in Oakland, California at 510-435-0138 or at www.g2microsystems.com.