SpatiaLight to Host Ribbon Cutting Ceremony at New Manufacturing Facility in the Republic of Korea

SpatiaLight to Host Ribbon Cutting Ceremony at New Manufacturing Facility in the Republic of Korea

NOVATO, CA, Feb. 28 /PRNewswire-FirstCall/ -- SpatiaLight, Inc. (NASDAQ:HDTV), a manufacturer of state of the art liquid crystal on silicon (LCoS) microdisplays, announced today that it will be hosting a ribbon cutting ceremony in Gyeongnam province, Republic of Korea on March 10, 2005, for the opening of its new mass production manufacturing facility. Expected attendees at the ceremony include Governor Kim Tae Ho of Gyeongnam province, Mayor Kim Soo Young of Sacheon city, representatives of the United States Embassy in Korea, executives from LG Electronics, Inc. (LGE) and SpatiaLight management.

In July 2004, SpatiaLight entered into an agreement with LGE, providing for SpatiaLight to sell a specially tailored version of its 1080p LCoS Sets to LGE. In January 2005, LGE announced in a joint press release with SpatiaLight that they are currently planning an initial rollout of 71-inch and 62-inch LCoS televisions incorporating SpatiaLight's LCoS Sets commencing in the second quarter of 2005, subject to the completion of pre-production requirements. LGE also announced that its initial product rollout will be into the United States, Korean and Australian consumer markets, with future plans for expansion into other markets.

In July 2004, SpatiaLight formed SpatiaLight Korea, Inc. (SLK), as a wholly-owned subsidiary of SpatiaLight, Inc., for the purpose of establishing the large-scale manufacturing facility in Korea and for facilitating business relationships in Korea and throughout all of Asia. Construction of the manufacturing facility was completed in January 2005. SpatiaLight is currently completing the installation of manufacturing and related equipment in the facility and actively hiring and training manufacturing personnel. SpatiaLight has received significant economic incentives and benefits from the Korean national and local governments because the area in which the facility was built has been officially designated a "free economic zone" and the Korean government has certified SpatiaLight as a "high technology" company. Periodically updated photographs of the manufacturing facility are available on SpatiaLight's website, www.spatialight.com.

Je-Won Yeun, President of SLK, commented, "The construction phase of our manufacturing facility plan was completed effectively and according to schedule and we are now seeing efficient advancement with equipment installation, hiring and training of key personnel and overall setup."

The Korean facility will serve as SpatiaLight's central commercial manufacturing base. SpatiaLight expects that the facility will commence production of products for commercial sale in the second quarter of 2005. The facility is designed with the capacity, at full employment, to produce up to 28,000 LCoS Sets per month. The facility has been specially designed for expansion to a capacity of 120,000 LCoS Sets per month in several expansion phases.

Dr. David Hakala, Chief Operating Officer of SpatiaLight, commented about the opening of the manufacturing facility, "We are pleased and excited to announce this landmark achievement for SpatiaLight. We are actively implementing the systems and processes necessary to ready us for full scale manufacturing to meet our customers' product demands."

About SpatiaLight, Inc.

SpatiaLight, Inc., founded in 1989, manufactures high-resolution LCoS microdisplays for use in High Definition televisions and rear projection monitors. The Company's proprietary SpatiaLight imagEngine(TM) LCoS microdisplays represent a solution for OEMs of large-screen rear projection monitors, home theater projection systems, video projectors, and other display applications. Utilizing more than 6.2 million pixels, SpatiaLight's LCoS Sets are designed to be incorporated into High Definition televisions and rear projection monitors. A SpatiaLight display unit, another Company product, is comprised of three SpatiaLight imagEngine(TM) microdisplays fitted onto a light engine designed by SpatiaLight and Fuji Photo Optical Co., Ltd. and manufactured by Fuji. SpatiaLight currently manufactures two models of its LCoS microdisplays. The "T-1" model has an active matrix of 1280 pixels by 960 pixels configuration and the newer generation "T-3" model has an active matrix of 1920 pixels by 1080 pixels configuration. SpatiaLight is committed to developing microdisplay technologies that will become the standard for the next generation of rear projection display devices and to providing OEMs with the most cost effective, high-resolution microdisplays in the industry. For more information about SpatiaLight, please see the Company website: www.spatialight.com.

Safe Harbor Statement

This news release and statements made in the webcast include forward-looking statements that reflect SpatiaLight's current expectations about its future results, performance, prospects and opportunities. SpatiaLight has tried to identify these forward-looking statements by using words and phrases such as "may," "will," "expects," "anticipates," "believes," "intends," "estimates," "plan," "should," "typical," "preliminary," "we are confident" or similar expressions. These forward-looking statements are based on information currently available to SpatiaLight and are subject to a number of risks, uncertainties and other factors that could cause SpatiaLight's actual results, performance, prospects or opportunities in the remainder of 2004 and beyond to differ materially from those expressed in, or implied by, these forward-looking statements. These risks and uncertainties are outlined in the Company's filings with the Securities and Exchange Commission, including its most recent reports on Forms 10-Q and 10-K.

Source: SpatiaLight, Inc.

CONTACT: Ted Banzhaf at SpatiaLight, Inc., +1-415-883-1693, ext. 132

Web site: http://www.spatialight.com/

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