Global Mirror GmbH and Research Frontiers Enter Into License Agreement
6 December 1999
Global Mirror GmbH and Research Frontiers Enter Into License Agreement for Production of Automatically Dimming SPD Mirrors
WOODBURY, N.Y.--Dec. 6, 1999--Mirror Systems Adopts Fast-Responding SPD Light Controlling
Technology to Control Glare and Promote Motor Vehicle Safety
Research Frontiers Incorporated announced today that Global Mirror GmbH & Co. KG has obtained a worldwide license to manufacture and sell automatically dimming SPD rear-view mirrors using Research Frontiers' fast-responding SPD light-control technology. The license covers rear-view mirrors for trucks and other commercial vehicles such as vans, buses, sport utility vehicles and other light trucks, as well as passenger cars, motorcycles, boats, trains and aircraft. The license also restricts new licenses from being granted in the truck mirror original equipment market for a period of time if certain sales milestones are met with respect to commercial vehicles in Classes 5 through 8 with gross vehicle weights in excess of 16,000 pounds. Under the agreement, new licenses covering SPD mirrors can still be granted to third parties in the passenger car, sport utility vehicle, motorcycle and light truck markets, in the heavy truck aftermarket, and with respect to all vehicles weighing 16,000 pounds or less. In addition to minimum annual royalties, under the license agreement with Global Mirror, Research Frontiers will receive a royalty of between 5-8% of net sales of licensed products.
Large-area SPD mirrors can change faster than electrochromic mirrors of similar size, not only from light to dark to prevent eyestrain and temporary blindness from the glare from approaching headlights, but also when reversing from dark to high-reflectance to permit good visibility when driving conditions require it. SPD rear-view mirrors, with their virtually instantaneous reaction time, can feature "real time" switching in which the mirror can automatically and rapidly adjust to an infinite number of intermediate levels of glare reduction.
The Global Mirror affiliated group of companies operates five manufacturing facilities on four continents and has additional joint ventures worldwide. These companies together comprise the world's largest manufacturer of commercial vehicle mirror systems. Their mirrors come as standard or optional equipment on some of the world's finest trucks. The group's corporate offices for the Western Hemisphere, as well as their engineering and manufacturing operations for North and South America are located in the United States, and they have additional locations in Germany, Sweden, Brazil, China, Turkey and the Czech Republic.
Until now, large trucks have had no effective solution to the safety and comfort problems caused by glare from approaching headlights. Alternative light-control technologies, such as electrochromic technology which is currently used in smaller-sized mirror systems for passenger cars, sport utility vehicles and light trucks, have been unable to offer the speed of response necessary to effectively and quickly reduce glare, especially where the large surface area of the mirrors would cause considerably slower response times using electrochromic technology. SPD mirrors can respond rapidly, even at much larger sizes. SPD mirrors therefore have a promising initial opportunity in very large size truck mirrors, an automotive segment which electrochromic mirrors have not substantially penetrated because of their very slow speed of response. Studies have shown that self-dimming rear-view mirrors can not only improve driving comfort and reduce driver fatigue, but can also improve safety by reducing the reaction time to driving hazards. Reported studies have shown that 60% of rear-end, intersection and head-on collisions could be avoided if drivers had an additional one-half second of reaction time. Reduced glare may also improve a driver's ability to judge the distance of other vehicles, which makes passing and turning safer. A good mirror is particularly important since heavy trucks usually do not have interior rear-view mirrors like passenger cars, so truck drivers must rely heavily on their side mirrors and reportedly look at them every 7-10 seconds while moving. Also, commercial truck drivers, especially drivers of Class 7 and Class 8 trucks do much of their driving at night when glare is a particular problem.
The market for self-dimmable rear-view mirrors has reportedly grown at a 35% annual rate since 1992. At present, electrochromic self-dimming mirrors are utilized in many automotive models and account for about 6 million of the estimated annual worldwide production of 150 million rear-view mirrors for new cars and trucks. Currently, less than 5% of all vehicles worldwide have automatic dimming interior mirrors, but industry participants estimate that eventually one half of the 50 million light vehicles produced every year will contain an automatically dimming mirror.
"Global Mirror brings to the development of SPD technology a strong and well-respected history of supplying the global commercial vehicle industry with state-of-the-art rear vision technology and systems to enhance safety and comfort. They have a high commitment to quality and engineering, and very strong manufacturing and distribution capabilities worldwide," said Robert L. Saxe, President of Research Frontiers. "We look forward to working closely with them to help them bring SPD light-control technology to the world's professional drivers and to validate the durability and performance of SPD technology in the most demanding area of the automotive market -- the truck market. While we have chosen truck mirrors as the initial SPD automotive mirror product, we believe that not only the truck industry, but the passenger car, light truck, and sport utility vehicle markets will prefer SPD type rear-view mirrors for reasons of safety, cost, performance and convenience. In addition to mirrors, SPD technology can also be used by the automotive industry for sunroofs, sunvisors, vehicle windows, and dashboard instrument panels and navigation systems. We plan to continue to license SPD technology for all of these automotive applications as well," noted Saxe. In addition to Global Mirror, Research Frontiers has licensed various SPD automotive applications to Hankuk Glass Industries Inc. (which outside of Japan is reportedly Asia's largest flat glass producer), Material Sciences Corporation , which is the world's second largest producer of specialty window films, and Glaverbel, SA of Belgium (which is majority-owned by Asahi Glass, one of the world's largest automotive glass manufacturing companies). The licenses with Hankuk and Glaverbel currently permit these companies to make and sell SPD rear-view mirrors. Licensees of Research Frontiers who incorporate SPD technology into end products will pay Research Frontiers a royalty of 5-10% of net sales of licensed products under license agreements currently in effect.
Of the goals for the coming year which Research Frontiers noted at its annual shareholders meeting in June, the following have now already been accomplished: (1) licensing large chemical companies to make the emulsions used to make SPD film, (2) licensing automotive suppliers for for large-size truck mirrors (other planned automotive products are sunroofs and sunvisors), and (3) expansion of Research Frontiers' already- broad patent portfolio (including the acquisition of patents enabling SPD mirrors to meet the U.S. Department of Transportation safety regulation which requires that the reflectance of a powered multi-reflectance mirror be at least 35% in the unpowered state or be adjustable to do so). The automotive industry likes to see at least two licensed sources of supply for each component. Research Frontiers now has at least two licensees (Dainippon Ink and Chemicals and Hitachi Chemical Co.), and four film-making licensees (General Electric, Hankuk Glass Industries, Hitachi Chemical Co. and Material Sciences Corp.). "We believe that we now have in place the infrastructure (with multiple sources of supply) to support our end-product licensees like Global Mirror, and it has therefore become easier for new automotive and other companies to become involved in the production of innovative products using SPD technology," noted Joseph M. Harary, Vice President of Research Frontiers.
Research Frontiers is a technological leader in the development and licensing of suspended particle devices (SPDs) -- electrically operated light control devices using proprietary particle suspensions and films. SPD technology permits light transmission to be electrically controlled instantly either automatically by means of a photocell or other sensing or control device, or adjusted manually by the user. Devices which can use SPD technology include variable light transmission "smart" windows, variable light transmission eyewear (including prescription and non-prescription sunglasses and sports goggles), self-dimmable automotive sunroofs, sunvisors and rear-view mirrors, as well as enabling brighter easier to read flat panel information displays for use in computers, television, telephones and other electronic instruments. Research Frontiers currently has agreements in effect covering smart windows, automotive mirrors and sunvisors, eyewear, displays and other products with major international corporations and holds or has rights in about 350 patents and patent applications on SPD technology throughout the world. Additional information about Research Frontiers can be found on the Internet at http://www.refr-spd.com.
Note: From time to time the Company may issue forward looking statements which involve risks and uncertainties. This press release contains forward looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Actual results could differ and are not guaranteed. Any forward looking statements should be considered accordingly.