Production Commences of LCoS Microdisplays for Head Mounted Display Units

NOVATO, Calif., March 16 /PRNewswire-FirstCall/ -- SpatiaLight, Inc. (Nasdaq: HDTV), a leading developer and manufacturer of ultra high-resolution Liquid Crystal on Silicon (LCoS) microdisplays, announced today that it has entered into a Purchase Agreement with DeoCom of South Korea. The agreement was consummated on March 9, 2007, and provides the terms and conditions under which SpatiaLight will supply DeoCom with LCoS imagers and associated products for Head Mounted Display applications over a period of three years. The estimated value of product expected to be sold by SpatiaLight under this agreement, given DeoCom's forecast, is over $27 Million. SpatiaLight has received a firm purchase order for the first 1,000 units to be delivered under this agreement and has commenced production of LCoS microdisplays for use in DeoCom's Head Mounted Display (HMD) units to fulfill this order.

Dr. Michael Jin, Chief Technology Officer of SpatiaLight, stated, 'Technically, this product is similar to our core product, the T3, but with some modifications to the cell fabrication that allow for a faster response time. Several small drive circuitry and firmware modifications enable single panel operation, as well In addition to single panel designs, DeoCom also intends to manufacture the 'glasses' in a dual panel, dual channel configuration. This '3-D' HMD is capable of stereoscopic operation, and will therefore support some very exciting 3D applications. This is a new, intriguing and growing market segment.'

David Hakala, SpatiaLight Chairman and Chief Executive Officer, said, 'We are very pleased to have entered into this agreement that grew out of our memorandum of understanding signed in January. This marks an important point in our drive to diversify our customer base. To our knowledge, this is the first and only 1920 x 1080p near-to-eye product to be announced in the marketplace, let alone manufactured. We believe that this will become an important product segment for business travelers, gamers and anyone who wants total immersion while using video-based equipment. We anticipate that DeoCom will demonstrate this product in the near future to well known Tier 1 US companies in the gaming, personal computer and personal mobile electronics industries.