- 16 March 2006 -

APA Enterprises sells MOCVD operations - licenses GaN patents

APA Enterprises has sold its multi-wafer MOCVD operations and related intellectual property and entered into a revenue sharing licensing agreement for total consideration of $1.9 m in cash.

The deal includes sale of its multi-wafer MOCVD system and technical know-how associated with the growth of state-of-the-art epilayers; two heterojunction field effect transistor patents, a pending patent application, and associated intellectual property. The operations were located in an off-site leased facility.

Terms of the transaction allow APA to market and sell products for applications greater than 1 GHz and provide revenue sharing based on future licensing agreements regarding these patents. The asset purchase agreement includes an additional consulting agreement for up to $100,000 over the course of one year.

The transaction impacts three employees associated with the development and growth of the epilayers.

APA's Optronics Division will now focus mainly on GaN products in both UV detector and power amplifier areas. APA Enterprises is already pursuing the GaN-based UV detector market for both commercial and industrial applications. It is also developing power amplifiers that target the cellular communications market. Going forward, the Company will procure transistors from outside sources to support power amplifier plans.

The Company began focusing its UV detector manufacturing operations in June 2004 when it discontinued its detector manufacturing consisting of detector packaging operations in Aberdeen, South Dakota and growth and processing operations of its standard GaN and AlGaN detectors in Blaine, MN.

"The recent transaction provides valuable cash and should decrease operating costs in the future," said Dr. Anil Jain, President of APA Enterprises, Inc. "Focusing on the transistor products based on procured transistors will have the potential of early entry into the market at lower costs," added Jain.

Web: http://www.apaenterprises.com