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Technology Stocks : Research Frontiers (REFR) -- Ignore unavailable to you. Want to Upgrade?

To: Paul M. who wrote (438)	2/2/1998 5:23:00 PM
From: N. Dixon	Respond to of 50073

Here is copy of letter for all to read: February 2, 1998 Progress Report Dear Shareholder: Because the Company's 1997 Annual Report will not be mailed out until about late April, I thought you might appreciate receiving this current update concerning the Company's activities. Within the next 6 weeks we are scheduled to hold a meeting with Mr. S.M. Kim, the President of our licensee, Hankuk Glass Industries Inc., along with the project leader for Hankuk's SPD film program. Hankuk has already succeeded in producing attractive prototype SPD film and publicly announced plans to commercialize SPD products. The only technical tasks remaining for their program of which I am aware are (1) to develop a commercial source for large quantities of their film-making materials (which I discuss below) and (2) to have their SPD film pass a durability test with a goal of having SPD film products that will last for decades under extreme weather conditions. At the forthcoming meeting we will exchange with them important technological information which will address both points. Also, Mr. Kim has informed us that, notwithstanding the economic problems of other Korean companies, Hankuk is strong. Furthermore, one can expect that the weak Korean currency should enhance their exports of any SPD products sold under their worldwide license. You may be interested to learn that Research Frontiers has recently invented two very superior new types of particles for use in SPD films. The new particles are expected to provide the films with substantially improved properties such as enhanced chemical durability, an increased range of light transmission and/or new off-state colors. It is possible to readily substitute one type of particle for another in our films, so these new particles can take advantage of the progress that we and our licensees have already made. As the result of equipment we have purchased, built and will deliver this week, we expect one of our outside suppliers to be able to provide multi-gallon quantities of the key component of our film-making liquids within the next several months. Because of the thinness of the film, each gallon of film-making material can produce a large area of film. This "scale-up" activity should soon enable our film-making licensees to make larger scale test runs of SPD film. If the film is satisfactory, commercial production runs are expected to follow. Hankuk should be able to use this supplier, or could provide similar equipment to another supplier of its choice. Likewise, Material Sciences Corporation, our other active film-making licensee should be able to obtain film-making supplies from this source. I am also extremely pleased to inform you that our eyewear licensee, Orcolite, a subsidiary of Monsanto has, with our help, made splendid and very rapid technical progress to develop a prototype SPD eyewear lens. Orcolite shares our strategy of aiming first at the sports goggle application which should be attractive to skiers, sailors, hikers, motorcyclists, etc., and thereafter refining the product for the vast sunglass market. To develop the goggle lens two main tasks must be accomplished: (1) Deposition of conductive transparent coating on the concave and convex sides of curved polycarbonate lenses; and (2) Achievement of a large range of light transmission with low haze and moderate voltage. These goals have already nearly been achieved even though Orcolite only received its exclusive license in August, 1997. We expect that prototype goggle lenses that could meet the above requirements will be demonstrable within 90 days. If this occurs, the integration of the lenses with suitable frames and miniaturized electronics should follow. In view of the fact that there currently exists no competitive type of electrically controllable "smart" eyewear on the market, and in view of the enormous market potential, we are very excited over the prospects for SPD eyewear. During 1996 and early 1997 we indicated to shareholders our optimism about making license agreements with Hankuk Glass Industries and Material Sciences Corporation, and our goal of listing our shares on the NASDAQ National Market. All of these goals have come to pass. Now we have set even more ambitious goals, including obtaining a relationship with a large automotive supplier. Because our licensees will control the manufacture and sale of SPD products, it has been our policy not to predict when SPD products will be commercialized. However, I believe the information contained in this letter should give you much reason to share our optimism. Assuming that SPD products achieve commercial success, the Company should be on the receiving end of a substantial stream of royalty revenue. We look forward to giving you additional news later this year. Sincerely yours, Robert L. Saxe President This letter contains "forward looking statements". The estimates, projections and other information contained in this letter are based upon information and estimates believed to be accurate and reasonable, but are not guaranteed.

To: Paul M. who wrote (438)	2/2/1998 5:26:00 PM
From: Ronald Aguilar	Respond to of 50073

Just got a copy of the letter myself. I thought that this would interest everyone on this post. Oh by the way, there will be an internet conference call via chat, on Thursday Feb. 5,1988 at 7:30pm. The address for the call is privateinvestor.com. February 2, 1998 Progress Report Dear Shareholder: Because the Company's 1997 Annual Report will not be mailed out until about late April, I thought you might appreciate receiving this current update concerning the Company's activities. Within the next 6 weeks we are scheduled to hold a meeting with Mr. S.M. Kim, the President of our licensee, Hankuk Glass Industries Inc., along with the project leader for Hankuk's SPD film program. Hankuk has already succeeded in producing attractive prototype SPD film and publicly announced plans to commercialize SPD products. The only technical tasks remaining for their program of which I am aware are (1)to develop a commercial source for large quantities of their film-making materials (which I discuss below) and (2) to have their SPD film pass a durability test with a goal of having SPD film products that will last for decades under extreme weather conditions. At the forthcoming meeting we will exchange with them important technological information which will address both points. Also, Mr. Kim has informed us that, notwithstanding the economic problems of other Korean companies, Hankuk is strong. Furthermore, one can expect that the weak Korean currency should enhance their exports of any SPD products sold under their worldwide license. You may be interested to learn that Research Frontiers has recently invented two very superior new types of particles for use in SPD films. The new particles are expected to provide the films with substantially improved properties such as enhanced chemical durability, an increased range of light transmission and/or new off-state colors. It is possible to readily substitute one type of particle for another in our films, so these new particles can take advantage of the progress that we and our licensees have already made. As the result of equipment we have purchased, built and will deliver this week, we expect one of our outside suppliers to be able to provide multi-gallon quantities of the key component of our film-making liquids within the next several months. Because of the thinness of the film, each gallon of film-making material can produce a large area of film. This "scale-up" activity should soon enable our film-making licensees to make larger scale test runs of SPD film. If the film is satisfactory, commercial production runs are expected to follow. Hankuk should be able to use this supplier, or could provide similar equipment to another supplier of its choice. Likewise, Material Sciences Corporation, our other active film-making licensee should be able to obtain film-making supplies from this source. I am also extremely pleased to inform you that our eyewear licensee, Orcolite, a subsidiary of Monsanto has, with our help, made splendid and very rapid technical progress to develop a prototype SPD eyewear lens. Orcolite shares our strategy of aiming first at the sports goggle application which should be attractive to skiers, sailors, hikers,motorcyclists, etc., and thereafter refining the product for the vast sunglass market. To develop the goggle lens two main tasks must be accomplished: (1) Deposition of conductive transparent coating on the concave and convex sides of curved polycarbonate lenses; and (2) Achievement of a large range of light transmission with low haze and moderate voltage. These goals have already nearly been achieved even though Orcolite only received its exclusive license in August, 1997. We expect that prototype goggle lenses that could meet the above requirements will be demonstrable within 90 days. If this occurs, the integration of the lenses with suitable frames and miniaturized electronics should follow. In view of the fact that there currently exists no competitive type of electrically controllable "smart" eyewear on the market, and in view of the enormous market potential, we are very excited over the prospects for SPD eyewear. During 1996 and early 1997 we indicated to shareholders our optimism about making license agreements with Hankuk Glass Industries and Material Sciences Corporation, and our goal of listing our shares on the NASDAQ National Market. All of these goals have come to pass. Now we have set even more ambitious goals, including obtaining a relationship with a large automotive supplier. Because our licensees will control the manufacture and sale of SPD products, it has been our policy not to predict when SPD products will be commercialized. However, I believe the information contained in this letter should give you much reason to share our optimism. Assuming that SPD products achieve commercial success, the Company should be on the receiving end of a substantial stream of royalty revenue. We look forward to giving you additional news later this year. Sincerely yours, Robert L. Saxe President This letter contains "forward looking statements". The estimates, projections and other information contained in this letter are based upon information and estimates believed to be accurate and reasonable, but are not guaranteed.