We are currently conducting research and development for the POET platform, which allows for the

construction of semiconductors with the potential to service a wide array of devices. We have been

awarded more than a dozen U.S. Department of Defense and National Aeronautical and Space

Administration’s (“NASA”) Small Business Innovation Research (“SBIR”) grants since 2000, which

have supported the initial development of the POET process, infrared sensing technology, sensor/laser

development and the combination of electronic circuits and lasers on the same microchip. In 2014, we

eliminated the use of SBIR grants in order to focus on developing and monetizing the technology.

We have produced working device prototypes in our development laboratories at the UConn campus to

prove the functionality of the POET process. We are now transitioning the device technology into

development of a completely integrated platform, utilizing funds provided from our general funds and

facilities provided by a foundry development partner. Throughout the transition process, we will continue

to use our UConn research and development facility, BAE’s facility or other such foundry facilities, in

our effort to produce scalable commercial IC prototypes. We are working to produce a functional IC,

although no assurances can be given that such project will be completed on a timely basis, if at all. These

prototypes are targeted to demonstrate our position as a sole source provider meeting specific product

application needs and are anticipated to be used to help initiate our marketing efforts.

We conduct most of our own research and development activities through our facilities on the UConn

campus in Storrs-Mansfield, Connecticut. In addition, we will contract specific projects with third-party

research and development organizations, such as BAE.