Computer Motion Announces Equity Investment and Distribution Partnership.

Business Editors

SANTA BARBARA, Calif.--(BUSINESS WIRE)--May 16, 2000

Kino Corporation Investment in Capital Equipment and Common Stock With a Potential Value of More Than $26 Million Over the Next 8 Years

Computer Motion, Inc. (Nasdaq:RBOT), the leader in medical robotics, announced today that it has obtained an equity investment and signed an exclusive distribution agreement in Japan for Computer Motion product platforms by Kino Corporation (Tokyo, Japan), which has a potential value of more than $26 million over the next 8 years.

Kino Corporation has ordered Computer Motion products totaling more than $2.6 million, deliverable over the next two quarters, to start government testing and subsequent clinical trials in both cardiac and general surgery applications. Kino Corporation has also committed to purchasing an additional $2.3 million in product revenue during the Shonin regulatory process, with the remaining balance spread over the last five years of the contract. They anticipate that the Shonin regulatory approval process should take between 24 and 36 months. Kino Corporation has also signed a stock purchase agreement for $2.5 million.

"We are very pleased that Kino Corporation has chosen to invest in Computer Motion," said Robert W. Duggan, Chairman and CEO of Computer Motion. "In addition to their confidence in Computer Motion's life-enhancing computer and robotic technology, we are encouraged by the level of interest in the Japanese healthcare community for technological applications to advance minimally invasive surgery. We believe that Kino Corporation represents the ideal partner for Japan, and this distribution agreement offers an excellent opportunity to expand our international market reach and deliver some significant export sales revenue in a new territory," added Mr. Duggan.

Computer Motion, the world leader in medical robotics, is creating the cornerstone technologies and products for the Intelligent Operating Room(TM). The company develops, manufactures and markets proprietary computer-enhanced and robotic surgical systems, which enhance surgeons' capabilities, improve outcomes and reduce costs. Computer Motion's products include the voice-controlled AESOP(R) endoscope positioning system; the HERMES(TM) Control Center, a centralized system which enables the surgeon to voice control a network of "smart" medical devices; and the ZEUS(TM) Robotic Surgical System for new minimally invasive microsurgery procedures, such as endoscopic coronary artery bypass grafting (E-CABG(TM)). ZEUS is CE-Marked for commercial sale in the European Community, and the company has completed an FDA-approved Phase 1 Investigational Device Exemption (IDE) study with ZEUS. Computer Motion and Medtronic (NYSE:MDT) are co-marketing ZEUS. The company's Website is www.ComputerMotion.com.

This press release contains forward-looking statements concerning the company's business and products. Actual results may differ materially depending on a number of risk factors, including the risks of competition and competing technologies, duration or suspension of clinical studies, regulatory clearances and approvals, and physician, hospital and payor acceptance of the company's products. These factors and other risks inherent in the company's business are described from time to time in the company's Securities and Exchange Commission filings, including its Annual Report on Form 10-K. The company undertakes no obligation to revise the forward-looking statements contained herein to reflect events or circumstances after the date hereof to reflect the occurrence of unanticipated events.