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Technology Stocks : Research Frontiers (REFR)
REFR 1.610+3.6%Dec 9 3:59 PM EST

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From: N. Dixon12/17/2013 11:14:32 PM
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Valuation of Patents

Since REFR developed and patented SPD technology to license out to large companies in several industries.

Since all the royalties are collected on the net sale price of the end product, we have waited while Daimler and other companies developed and tested products.

The automotive glass market makes decisions on products after working with them for a number of years. The reason the S-Class was such a monumental shift in the acceptance of SPD products in automotive, was that Daimler started out with the Maybach, which used a different technology than ours, until it has finally decided on SPD for future smart glass applications. The S-Class is their flagship and therefor had galvanized the other luxury car makers to get their products out to be competitive.

The technology offers heat protection and variable light. The heat benefit is greater than that of a car with no sunroof, which is why it allows drivers not to have to start up the air conditioning after the car has been sitting out in the sun.

It is those unique properties of the film that REFR has over 450 patents and patents pending for. The emulsion, film and glass/composite products are all done by licensee who bear all the costs. The company's value is based on the number of products our licensees sell.

Here's an article on the value of portfolio patents. Since we will never incur the costs required to manufacture and since the licensee have already sold enough product to make us profitable next year we will never require financing. The products available have grown exponentially and news on several has been released. The market is enormous and our licensees pipeline is deep. Dividends will begin soon after profitability, 12-18 month is my best guess. But it's the patents that we own that bring us the enormous royalties because of the myriad of applications in several industries. Automotive is the largest share now, but will be surpassed most likely by architecture in the coming years. Entire countries are looking at controlling CO2 emissions and are adopting building materials that further this goal.


Forbes: How to Tell What Patents are Worth
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