Invention Machine Corp. And Lightpath Technologies, Inc. Form Lightchip, Inc. To Develop And Market High-Performance, Low-Cost Wavelength Division Multiplexing Technology

Business Wire, July 8, 1997

ALBUQUERQUE, New Mexico--(BUSINESS WIRE)--July 8, 1997--

Invention Machine Contributes Engineering Methodology and

LightPath Contributes GRADIUMT Lens Technology For "Universal" WDM To Cost-Effectively Multiply the Data-Carrying

Capacity of Fiber-Optic Networks

Invention Machine Corporation of Boston and LightPath Technologies, Inc. (Nasdaq: LPTHA/LPTHU) of Albuquerque announced today that they have formed a joint venture company, LightChip, Inc., to develop, manufacture and market the next generation of wavelength division multiplexing (WDM) systems for use by telecommunications carriers, CATV companies, local area network (LAN) and wide area network (WAN) systems integrators.

WDM devices serve as data "traffic cops," allowing a wide range of data, at varying speeds, to move simultaneously through an optical fiber network. WDM technology is generally considered to be a key to satisfying the "bandwidth" requirements of the Information Age. The overall market for WDM technology was $100 million in 1995; it is projected to reach $12 billion by 2005, according to industry research.

LightChip's mandate is to develop a universal design for high- performance, low-cost WDMs that can be customized for either long- or short-distance (e.g. LAN) applications, and enhanced to meet future performance and cost requirements.

LightChip will be 51% owned by LightPath Technologies, Inc., 35% by Invention Machine Corporation and 14% reserved to be issued to key employees. LightChip will initially seek to raise $2 million from private investors to produce its initial products. LightPath, which will manage LightChip until it is funded, has first right of refusal to buy Invention Machine's shares in the new company.

Privately held Invention Machine - whose engineering problem- solving software and invention strategies are at use at Motorola, Ford, Ingersol Rand, Becton Dickinson, Xerox and 3M as well as other organizations -- will contribute to the LightChip joint venture senior-level expertise and exclusive use in WDM of the Innovative Technology of Design (ITD) and TechOptimizerT Professional Edition software suite, Invention Machine's core applications. They will address the conceptual design issues of a fully integrated, universal WDM system.

LightPath Technologies - developer and manufacturer of patented GRADIUMT glass, which possesses internal light- navigating and wavelength-separating properties unavailable in any other high-performance optical components - will devote its GRADIUM technology and R&D capabilities to LightChip. GRADIUM glass may enable the LightChip WDM technology to set new standards for versatility, ruggedness and cost- effectiveness.

Said Leslie Danziger, chairman of LightPath Technologies, "With the majority stake in LightChip, LightPath and its shareholders will participate in a more significant way in the WDM market, as LightChip will be a value-added systems integrator selling to telecommunications and data communications carriers. Without LightChip, LightPath would participate only as a materials component supplier to other systems integrators. LightPath will be the sole supplier of enabling GRADIUM materials to the new company, and the R&D costs associated with optimizing GRADIUM technologies for WDM will be shifted to LightChip."

Said Tom Lewis, president of Invention Machine, "We're convinced that the synergy of the unmatched light-bending and wavelength separating capabilities of GRADIUM glass and Invention Machine's proprietary engineering methodology and software will enable LightChip to lead in the development and production of the next generation of low-cost, high- performance, versatile WDMs."

Invention Machine Corporation is the leading provider of software tools which enable engineers, scientists and technologists to extend their knowledge base and capabilities to solve technical problems by generating innovative ideas. Invention Machine Corporation's revolutionary software tools provide users with access to the most successful inventive principles and engineering effects which stimulate the rapid production of high-quality, well-designed products. Internationally, Invention Machine Corporation has offices in Germany and Sweden.

LightPath Technologies, Inc. manufactures GRADIUM materials - cost-effectively, in large and small volumes - at its headquarters facility in Albuquerque and has 13 patents associated with the process to manufacture GRADIUM glass. Current customers for GRADIUM glass include: industrial laser, medical imaging, sports optics, wafer chip inspection, optical storage and scientific research equipment manufacturers. LightPath common stock trades under the NASDAQ stock symbol LPTHA. LightPath units, comprised of common stock and warrants, trade under the NASDAQ stock symbol LPTHU. The company raised approximately $8 million in a February 22, 1996 initial public offering.

CONTACT: LightPath Technologies, Inc.

Frank Sommerfield Communications, Inc., 212/255-8386

mail@sommerfield.com