"We are delighted to be making this investment in Neah Power to assist management in its efforts to bring the company's commercial product to fruition and capitalize on its tremendous market potential," said Jerrold Pressman, chairman of EPD.

Daniel Rosen, executive chairman of Neah Power said, "We welcome the support and confidence EPD has shown Neah Power. This funding will aid our efforts to drive our prototype to commercialization."

The note, due January 1, 2009, carries an equity fee plus interest of 10% and is convertible into shares of common stock at $0.29 per share.

About Neah Power

Neah Power Systems, Inc. is a leading developer of fuel cells for military applications, notebook computers and portable electronic devices. The company's patented, porous silicon-based design will provide long-lasting, efficient and safe power solutions. As an emerging leader in fuel cell technology, Neah Power's products will allow users to extend the operating time of 10 to 100 watt devices multiple times beyond that of conventional batteries. Further company information can be found at our website www.neahpower.com.