REFR - NASDAQ

Good afternoon, ladies and gentlemen. Welcome to the Research Frontiers Investor Conference Call to discuss the Third Quarter of 2023 Results of Operations and recent developments. [Operator Instructions] This conference is being recorded today. A replay of this conference call will be available starting later today in the Investor’s section of Research Frontiers website at www.smartglass.com and will be available for replay for the next 90 days. Please note that some of the comments made today may contain forward-looking information. The words expect, anticipate, plans, forecasts and similar expressions are intended to identify forward-looking statements. Statements that are not historical facts are forward-looking statements that are made pursuant to the safe harbor provisions that are part of the Securities Litigation Reform Act of 1995. These statements reflect the company’s current beliefs, and a number of important factors could cause actual results for future periods to differ materially from those expressed. Significant factors that could cause results to differ from those anticipated are described in our filings with the SEC. Research Frontiers undertakes no obligation to update or revise these forward-looking statements to reflect new events or uncertainties. The company will be answering many of the questions that were e-mailed to it prior to the conference call, either in the presentation or as part of the Q&A session at the end. In some cases, the company has responded directly to e-mail questions prior to this call, or will do so afterwards, in order to answer more questions of general interest to shareholders on this call. [Operator Instructions]. Also, we ask that you keep your questions brief in the interest of time. I would now like to turn the conference call over to Joe Harary, President and Chief Executive Officer of Research Frontiers. Please go ahead, sir.

Thank you, Paul, and hello, everyone, and welcome to our third quarter of 2023 investor conference call. First, let me start off by saying a number of our shareholders have asked about Gauzy and their safety and business with the war going on in Israel. Some of the questions to date has the Israeli war with Hamas impacted Gauzy's business operations in any significant way? Please comment on the effect of any of the war in the Middle East is having on Gauzy's operations in Israel? Is Gauzy currently producing and shipping SPD film coating to their plant in Germany? Gauzy has worldwide locations, but can it continue to function effectively, if its headquarters located – location is seriously impacted by conflict? Well, first of all, I want to thank all of you for your concern and Eyal Peso, and I and everyone at Gauzy really appreciate the messages inquiring about their safety. Thankfully, everyone is safe. And while I'm horrified by the situation in Israel, and see things happening in the world that I never thought I'd see in my lifetime or ever, I could report that Gauzy's operations have not been interrupted by the war there. Of course, they pay attention to it. How can one not do that? Good entrepreneur must factor in things like resources and competition and is really entrepreneur has a whole different dimension of things to add to that normally and especially right now. And Gauzy has been incredibly busy, both before and after October 7. And they've been admirably juggling work and family safety and doing it with very calm determination. Everyone pulls together in normal times and especially now. And they know they have investors and employees and customers, and they're depending on them. And we've been working with them daily and things appear much closer to normal than one would expect. As a matter of fact, the only reason Eyal Peso cannot be on this call today is that he has a pack business schedule, and that should give you an idea about business pressing on even more time. But once again, thank you and on behalf of Eyal, he asked me to thank everyone for their good wishes and concerns. The Tesla cybertruck was announced in 2019 with production slated for late 2021. Reports now indicate that production will start November 30 of this year, 2023. When the first prototype of the cybertruck was demonstrated at the launch event, my friend, Franz von Holzhausen, Tesla's Chief Designer, threw a metal ball at the bulletproof glass, and it cracked. When I first met Elon Musk in person, it was at the Model S concept launch event in New York. And prior to that, Tesla was making the Tesla Roadster with the body being produced by LOTUS out of fiberglass. At another in-person meeting, Elon Musk was trying to figure out how to produce 10,000 cars a year. In 2022, Tesla produced 1.37 million vehicles, which was a 47% increase over 2021 and in 2023, Tesla is expected to produce and sell around 1.8 million vehicles far more than the 10,000 they were originally trying to figure out how to produce. So what do all these things tell us? That if you're in the automotive industry, even the most capable players don't always get it right, at least not right away. And sometimes there's technical issues like the glass on the cybertruck prototype, which incidentally was not our smart glass at the time. And sometimes it's timing issues as shown by the multiple delays in the introduction of the cybertruck. But for the most part, a company that had never produced a car is now the dominant player in the electric vehicle market with the highest margins and volumes. In other words, things get done and they often get done in a big way, but rarely on schedule and almost never in a straight line. This is the world of the automotive manufacturer, and it's also the world we live in. We are told time frames and sometimes they are delayed as witnessed by the first car to use our technology, the SLK convertible roadster, which is five months overdue, once again, not because of our glass by the way. And sometimes things are ahead of schedule. The SLK convertible came out with our glass and it was ahead of the target date. And sometimes marketing plans change. Just six months before the launch of the Cadillac CELESTIQ at CES, the head of the project did not know when it would be launched and when it would be announced. It came out six months later with much fanfare. So we do our best to operate in this environment, and we try to strike a balance between providing guidance when we can to our shareholders or simply waiting for something to happen and announcing it afterwards. So there's a balance there. And many people, including myself and our licensees, were disappointed to learn that an Asian mid-priced auto manufacturer had decided to move back the introduction of its special luxury edition for the first half of next year. We share what we know when we can, and often it is just what we're told. And in the world we live in, it's not possible to thread the needle in terms of timing. So there is that balance and the Asian automaker has moved the timetable back by about half a year, but it's still on track there. Fortunately, we plan for such contingencies to make sure we're not going to run out of resources before anticipated events happen. For the past 37 years, we've been debt free. We have been successful at raising capital long before we may need it to keep the number of shares outstanding relatively low compared to our peers. For the past eight years, we've been constantly focusing on reducing operating expenses. Some of our competitors are not so fortunate or successful at achieving the same thing, and we are rapidly running out of cash. While they may measure their cash runway in terms of weeks, we have over five years worth of cash and continue to be debt-free. Vue is trading pre-reverse stock split at less than a nickel per share, and Kraken is at less than half a penny. At Research Frontiers, we don't want our shareholders to have to speculate about whether our technology will make it out of the lab and into the real world. It has already done that in multiple industries. We don't want our shareholders to have to speculate about whether the technology will be high-performing and reliable, two qualities that are essential in any upscale market. Mercedes and then McLaren and then General Motors and then Ferrari all have proven this in serial production. Airbus and Boeing and numerous other jet and turboprop and helicopter manufacturers are also proving this. New products in addition to the manufacturers I just mentioned will be coming out. Since our last conference call, we added yet another auto manufacturer project. This one is from North America. Now as a caveat, for this new project, do we have an estimated timeline and volumes? Yes. Will there be a straight line towards commercial production on that timeline? Maybe yes, maybe no. However, our longstanding experience in this industry has taught us to plan for both, things coming out ahead of schedule and things coming out behind schedule. Let's go to the numbers. Our fee income was up 46% for the first nine months of this year. Automotive income was up 81% in Q3 2023 compared to Q3 2022. For the first nine months of this year, automotive fee income was up over 120% from last year. And Ferrari has shown healthy growth in sales each quarter of this year for their new Purosangue. Our net loss is substantially lower and we're looking forward to becoming cash flow positive and profitable by executing on our business plan. We expect revenue in all market segments to increase as new car models, aircraft, trains and other products using our SPD Smart Glass technology are introduced into the market. With that, I look forward to answering your questions. We took some of them that were emailed to us and included them in my presentation earlier. Here are some additional questions that were emailed to us. And in some cases, I'm combining several related questions into one. John Nelson had asked in the markets that the film was sold into which market sales are growing fastest quarter-over-quarter and year-over-year. Clearly, automotive followed by aircraft, and we expect architectural to become more significant in 2024 and later years? Another question by Mr. Nelson, any potential new markets that REFR plans to move into? I'm certainly excited about our red and butter industry growth prospects. More cars trains and planes, the traditional usage. As far as non-traditional markets, I'm particularly excited about the use of SPD with transparent OLED technology for displays and alternative areas of the car to the sunroof such as headlights, heads-up displays and Sundvisers and in Sunvisers, both as an attach visor or built into the windshield. I'm also excited about some of the new projects for SPD-SmartGlass and architectural. And there, we believe it's going to be both in retrofit and in new installations. And I think that's going to be very significant. Next question. Given the slow sales of EVs and no announced adoptions, the market for SPD may not be a high priority, considering, say, Ford is losing $40,000 a vehicle. The EV market is slowing down as the lack of interest stems from the lack of charging stations. Coupled with the auto strikes, I presume the royalties from the auto sector are now pushed out further. And also why we not heard about any architectural wins? Well, thank you, Jeff, for that question. First of all, based on what's in the pipeline, I expect architectural projects, both new and retrofit in 2024. And I don't think the UAW strike affected us at all. We're mostly in Europe and in Asia, and the strike is also basically over now and things are returning to normal. Regarding EVs, I think a lot of companies were caught up in the EV development momentum and did not fully realize the economic and technical challenges. I don't think that will help us, however, it will affect us. However, I don't think it's going to hurt us. First, some companies like BMW and Mercedes and Tesla have a leg up on other traditional car companies trying to make EVs, much higher margins than, let's say, Ford. Also, the same 5.5% increase in driving range for EVs applies to increased gas mileage for internal combustion engine vehicles and is also added in ICE's 4 grams per kilometer reduction in CO2 emissions. So we'll be fine either way. I mean, there's even an argument, Jeff, that if EV slowed down, you're going to have to do more to reduce CO2 emissions through the reduction techniques of using things like smart glass. So it may actually help us, although, I'm not rooting for a reduction in EVs. I think some are very good vehicles and some have challenges that eventually will be overcome. Next question, LG is introducing multiple models of transparent OLED for commercial and residential applications. I would think that any used in Windows in an outdoor sunny environment, we need SPD, do you have any ballpark estimate as to what percentage of these different markets might use SPD? Thank you. First of all, I agree that, any time a transparent OLED is used outdoors or with daylight behind it, such as turning the window in your home into a television or putting it infill on a vehicle window like BMW spoke about at CES this year with their SPD Smart Glass equipped car that they demo then highlighted at Oliver

[Operator Instructions] And our first question is from Francis Kotreba [ph]. Your line is open.

Good afternoon, Joe.

Hi, how are you doing?

Pretty good. Last conference call, you mentioned that the shareholders are going to be greatly rewarded. And this particular 2023, do you stand by that statement?

Well, the timing is obviously, off. Our stock is down. And as a shareholder, I don't -- I'm not happy about that because my net worth is tied up in this company. But I do think that part of this was the delay in the Asian vehicle that we were expecting to have happen in the fourth quarter. And like I said, we take ownership of that.

Yes. But with all the uncertainty, why would you make such a statement, Joe?

Because we were told – we were told that, that would be the timing. And then we were told that the timing changed. That's the nature of the automotive industry.

But it's the nature of the CEO to present himself in such a case, then he doesn't bring all the hope together for all the shareholders. Don't you agree?

It's a fair point. Like I said, we do the best we can with the information we're given. I mean, the alternative is just wait for everything to happen and announce it after the fact. But I think that a lot of people would prefer to get at least a sense as to the directions that we're moving in and the progress we're making. And I was -- and I'll admit it was a judgment call and I was wrong on that one.

Thank you

Thank you.

And our next question comes from John Nelson [ph]. Your line is open.

Hi, Joe.

Hi, John. By the way, thank you for your renewed investment in the company.

Well, it's all about potential. So I am feeling good about my investment in Research Frontiers. The press release states that fee income during the first nine months was up 46% versus last nine months last year. And then fee income for the third quarter was up 9% quarter compared to last year's quarter. What's -- why the -- what accounts…

Why the difference?

Yes.

Yes. A lot of it is timing. I mean, when you're comparing quarter-to-quarter, there could be specific events in one particular quarter last year that -- where there was a blip up. And when you take a longer period of time like nine months versus nine months, you get -- it's a little more smoothed out. And that's why the automotive income was up substantially for the nine months.

Okay. Good.

And also, as I mentioned earlier, I think you started to see Ferrari really kick in with good growth and the adoption of SPD is kick in.

Okay. Thank you.

Thanks a lot.

[Operator Instructions] And our next question comes from Art Brady. Your line is open.

Hi Joe, Art Brady here.

Hey Art.

Can you give us a little picture on when the actual billings would start with LG?

All of our license agreements have a provision that the licensee typically pays us 45 days after the end of the quarter in which a product is sold. So there may be products sold as part of the development process and things like that, but the real numbers come in when it hits the consumer markets, just like Automotive, just like Aircraft, just like Architectural.

So that would mean starting maybe early January?

When they decide to introduce the products, that's when you'll start to see revenues kick in. And I understand there's also a lot of licensees have to achieve a minimum royalty before you see additional income and they would have to exceed the minimum royalty for the year before you start having accretive new income. So just to use numbers if somebody had a $100,000 minimum royalty, that means and a 10% royalty, let's say, for Automotive, you only see new revenue come in after they've achieved the $1 million in sales of product which would generate $100,000 in royalty income. Then the next dollar after that generates another, additional revenue.

Okay. Thank you.

Thanks a lot, Art.

All right. [Operator Instructions] And we have a question from David Paradiso. Your line is open.

Hi Joe.

Hi Dave.

I've been a shareholder for 29 years now and still waiting. And given that the price of the stock is where it is, I'm concerned once again about delisting. Can you talk about the timing of when Reefer could be delisted and ramifications and all that?

Sure. So first of all, I don't expect it to happen. And I don't think we're going to have to do what our two competitors did with a 60:1 reverse stock split just to get their stock over $1 and one of them has already drifted down and got another delisting notice. But typically, the NASDAQ rules require that if you trade below the $1 for a certain period of time, then you have 180 days to come into compliance and trade above the $1. And if that doesn't happen, typically, there's another six-month period that's granted, and usually, what companies have done is do things like Woodview and Crown did, which is reverse stock splits to try to get their stock above $1. I don't expect that to happen. I think we're kind of in a period where there hasn't been any news, and I'm pretty confident that there will be good news well within the timeframe I just mentioned. So I'm not at all even thinking about it.

Okay. Thank you.

Thanks a lot, Dave.

And our next question comes from David Forrester [ph].

Actually, it's Michael Forrester [ph], if you can here me.

It's Michael Forrester. How are you doing Michael?

I apologize sir. Michael Forrester.

In regard to -- we had two suppliers of the film. Gauzy for one and Hitachi, which I think sold off its interest. Is there a problem in getting people to adapt the SPD technology because of a lack of multiple suppliers?

No. And there's more to the Hitachi story, which I think people will be pleased with when they hear about it. But no, we haven't encountered that. What the automakers, especially where they like to have multiple suppliers have been focusing on is on multiple sources of lamination. So do they have a glass laminator that -- which is the person that -- the company that sets the price for the automaker for things like sunroofs, it's having multiples in that part of the supply chain that has been important, and we have basically the who's of the auto glass industry license. So the automakers seem very comfortable with everything. And this recent North American project, we went through a good list of potential licensees to supply the project and they were all companies that the automaker would welcome working with. So it's been fine.

Well, you brought up at the beginning of the problems in Israel right now. And I'm just -- it strikes me that if it's realistically that Gauzy is the only producer of volume of film, there's a limit on what else can currently produce and maybe haven't hit the limit yet, but is that a barrier? Do you get that feedback from potential customers?

No. I don't. It's a fair question, though. So let me delve a little bit deeper into that maybe give people some comfort on that. So Gauzy actually has locations throughout the world. It's not just in one place. And they also have multiple locations even within Israel. So if God forbid something happened to their main facility in Tel Aviv-Yafo. And I've seen the Iron Dome work, and it works quite well. So it's a low chance in a populated area like that of something striking. But even if it did, there's a facility not 10 minutes away that things can be moved to. And then there's also facilities in Germany and other places that can house. So they -- unfortunately, the world they live in involves contingency planning that we don't have to do in New York, at least thankfully, not right now. So it's very much part of their strategic planning to be able to deal with situations like that. And another -- sure.

Yes. On -- you've talked about the reduction of costs. That's primarily administrative or internal? And I…

A Research Frontiers, yeah a Research Frontiers. The other focus on cost is at the end product side. And there, we've gotten the cost of the SPD film to a fraction of what it was in the beginning.

Well, I'll preface my question with -- I understand you have contracts with various licensees, and I presume -- correct me if I'm wrong, that a typical provision is that the licensee gets the cheapest price that's offered to any licensee now or in the future.

No, no.

Okay.

There's no most favorite nations provisions. But with volume, you get discounts. And if somebody is developing a large use of SPD film, for example, they'll get a better price, I'm sure, from Galsi than someone that's doing a couple of windows.

Well, our return, as I understand it is typically 10%.

10% in automotive, 15% in the other markets of the revenue.

In that regard, if we offer 9.5% to a big buyer so that it increases the use of the product and gets other competitors of that buyer interested in competing. Has that been considered as a way of even though we lose some revenue in the year?

It's certainly been -- yes, yes. No, it's certainly -- I mean, look -- and that's an excellent question. Maximizing revenue, because we get paid based on revenue is positive for Research Frontiers. So going from, let's say, 10% to 9.5%, if there was huge volumes in a product that someone could commit to, is definitely something we've considered and discussed. The issue, though, is that for that to happen, the licensee has to commit to large volumes. And for that to happen, their automotive customer has to commit to large volumes. So they have to either make the standard equipment, then you know how much class you're putting in a vehicle and how much of it is smart glass or commit to a certain make rate, so you know, once again, how much glass you're putting. Or the way it is now, it's the customer deciding the configuration of what cars they want. And that's less predictable for the automaker obviously and less predictable for the glass laminating licensee. So if someone's willing to make a commitment, we certainly would consider a reduction if it was an impediment or if we can get more revenue out of it, because our costs are -- fixed.

Last topic. I see that there's -- warrants were purchased. Can you tell us what the lowest cost price to purchase stock of Research Frontiers by a warrant holder?

I'd have to look. I don't have that number in front of me. It's in our 10-Q though the weighted average and the exercise price of the warrants. Some go as high as $4, $5. Yes, some are exercisable at $4, $4.30, some are excisable at lower prices. No warrants repurchased though. I mean, there were some that were exercised in the first nine months of this year because they were in the money. And I think that was at $1.38, if I remember right, per share.

All right. Well, last question. Are there any warrant holders who could purchase stock now at a price less than the market?

No.

All right. Thanks.

Thanks a lot, Michael.

We have a question from John Nelson. Your line is open.

Hi, Joe. This is a follow-up. Earlier in the call, you mentioned the project near and dear t both of us due to the massive potential size of the market. The visor project, either attached or built into –

Or build the wind field, right?

Yeah. Can you share without naming names? Can you share any further details on the visor project?

So I could probably talk about what's been public only. And in the McLaren there's one version of the McLaren that has what's called the charlotte roof, which is a panoramic roof that kind of wraps down into the windshield of the car, if you can imagine. So that -- that band between the windshield and the roof is not metal. It's still it's a curve piece of glass. And they've actually done the Sun visor built into that. It's been done in low volume. And for other manufacturers that have much higher volumes, we've had development projects building that into the windshield itself. And what's cool about that, John, is that you can actually do multi-segmented -- multiple segments in the Sun visor. So then if you combine that with, let's say, a photo cell that detects were – [Technical Difficulty]

Hello.

Ferrari we've seen to over last year. Okay. Is that better now?

Yes, you're back, sir.

Okay. Thank you. Yes. So you can adjust which segment of the Sun visor actually goes up and down or it goes dark or light with a photo cell when you build it into the Windshield.

All right. Thank you. And our next question comes from Alan Ginsberg. Your line is open.

Yeah. Hello, Joe. How are you?\\

Hi, Alan, how are you?

I'm good. My question is a follow-up to one of the previous questions, and that has to do with suppliers. I understand what you said about fabricators, et cetera, but I'm sure that end users also look at the situation in Israel. So you mentioned Hitachi and that we'll be hearing something. And I'm very interested in that as a second supplier. So can you give us a little more color on that?

At this point? Okay. Thank you. I apologize. We had a voice over Internet issue, and I think it's been resolved now.

Hello?

Yes. Can you hear me?

Yes. Am I on the line with you now, Joe?

You still are? Okay

Yes. Sorry. Hi. I had asked you about Hitachi, and that's when we got cut off.

Okay. Yes. At this point, I'm not able to give more details about that, but I think everyone will be very happy with some of the details when they do come out. And hopefully, there will be a time soon when I can do that.

So is that a near-term thing that we might hear something about it?

It's not within my control, but it could be very near-term.

Okay. That's important to me. Thank you.

You’re welcome

[Operator Instructions] And we have a question from Tom Smith. Your line is open.

Hi, Joe.

Hi, Tom. How are you?

Good. So as you've probably seen, there was rumors the cyber truck might have sort of electrochromic. You opened the conference call mentioned in the cyber truck. Then you mentioned that at that time, it didn't have SPD. I don't think investors have much

I don't want you to read too much. I don't want you to read too much into that.

Okay.

It was more of an example of a vehicle that came out from a very reputable and innovative auto manufacturer that -- that had its share of delays and technical issues too. --and it is the world we live in.

I was just -- making sure.

Thanks for asking that.

Yes. And then how about Rivian? Anything on Rivian talk because they seem to be growing and they had shown SPD before?

Yes, they had shown SPD, and we hope that they will show it again because they are having issues with the heat buildup inside the vehicle. So we -- we're out there as a solution for many, many people.

Okay. And then as far as the Hyundai, you said first half, I mean that's kind of a large time frame. Is it more towards Q1 or Q2? Or you just have no idea.

I'm reluctant to give more of a precise timing because last time I did I was called out on it. So if you don't mind, I got to leave it somewhat long-term.

Yes. Has there been any more…

We're talking about the next. First half, we're talking about within the next six months to eight months.

Has there any been any more confirmation on it? Or does it stand where the confirmation was before? Or is it looking more certain or you can't say you don't know.

It's looking more certain, but I -- like I said, I'm reluctant to make any predictions given the fact that one of them just beat me in the butt.

Okay. All right. Thank you.

Thanks.

Thank you. And we have a question from John Nelson. Your line is open.

Hi. We got -- Joe, we got cut off

Sorry about that, John.

Don’t know what happened.

We had an Internet issue that you said.

Did I miss anything on comments, any more comments on the or details on the WISER [ph] project.

Other than we have development efforts in the past and currently, both in the windshield and as a stand-alone that McLaren had actually put it in series production, and you can have a system where it detects where the sun is on the horizon and decides, which segment to darken/enlighten based on where the sun is. So something that I think is a very good application and something near and dear to my heart as well.

Okay. Are the partners that you're in project with this -- one partner for both fixed and attached or two-part?

Different licensees.

Okay. Excellent. Thank you very much.

Thanks a lot, John.

And our next question is from Tom McCarthy [ph]. Your line is open.

Hi, Joe.

Hey, Tom. How are you?

Good. Enjoying retirement, and as a former financial adviser, I'm very aware that the investment community is going to be looking at Research Frontiers and painting it with the same brush as it did View [ph] and Crown and similar companies or similar products that aren't going to be successful. In other words, Research Frontiers is going to have to do a good, strong aggressive PR initiative, I believe, to really get the investment community to take a serious look at it. What are the plans to do that?

Sure. So that's a fair question and something that both we and Gauzy incidentally have discussed many, many times in terms of that. There are big differences between us and Crown and us and View. First of all, the economics, View is a bad company in my opinion, because the technology doesn't perform well and they had an accounting fraud issue and it's not for lack of sales, it's for lack of performance and they highly subsidize their sales. So they lost $250 million in cash last year. We didn't. And I can pretty much assure you that there's nobody in our supply chain that is building a business around that business model of highly subsidizing to the point of losing massive amounts of money. It's just not in anyone's DNA. Every project has to stand on its own economically and it will. And that's one of the key differences in it. Crown doesn't have a product that came out the door. So I don't think anybody is comparing us to them. There have been a lot of promises over the years in moving goalposts and things like that. But their smart window insert has not come out yet, and it's always around the corner. So I don't think we have to worry too much about that. And you have things like the Dynamic Glass Act, that's part of the IRA that is giving tax credits for smart windows. So that changes the economics also in our favor. So I wouldn't really say that View is a fair comparison. I think that it's certainly something that we and Gauzy have to work to distinguish ourselves from, and we do. But it's not a direct comparison. And I've been in the last three to four conference calls pointing out from time to time some of the differences between us and them. But on the marketing side, you have a window that goes darker, goes lighter and switches faster. It's not a direct comparison. We're much better performing than them. It's a film, which makes the logistics easier, which means we don't have to ship glass across the world. So, we could ship film and have it laminated locally. So, there's a lot of things that are different, and we point that out to the customers.

I know that. And there are major differences. I'm not talking about potential customers. I'm talking about brokerage firms and newsletter writers and research services. They can be very superficial when they're looking at something new. And the inclination is going to be to think that REFR is another view or another crown. My point is--

Yes, except that anybody that does even more of a -- than super-visional analysis will see, we're not losing $0.25 billion a year in cash. We're not subsidizing the product and we're in multiple industries. So, it's a little bit different.

It's very different. But the point I'm trying to make, I guess, and I'm sorry, I'm delivering this is you can expect the folks I'm talking about to come to you unless you've gone to them, so to speak, unless you've--

Right. And I think -- yes, yes. And there is a messaging and PR initiative that is being launched that you'll see as well.

Terrific. Okay. Keep up the good work, Joe.

Thanks and I appreciate the question.

And our next question is from Gerald Sherman of Strategic Planning Group. Your line is open.

Thank you. Hey Joe, at what point do you yourself or the Board or any other insiders feel that it's a fairly cheap price to purchase the shares in the open market. I can't think of a better way because you can't control any other news of supporting the stock just to put your own money in it.

Yes. Well, some of our directors have purchased stock. There's, at any given time, different levels of information within the company that would restrict people also from buying it. I'm sure you're familiar with windows opening and closing. And right now, the window is closed. It may open up soon or may not. But we don't have free rein to purchase anytime we want because the insider trading rules that apply.

I understand that. But I mean it's a year since we've been news other than Ferrari, I'm sure there's been plenty of windows that you guys could enable. And other than a few thousand shares here or there, which is not really an impactful purchase. I just think that it would put us all well if you guys stepped up and actually purchase some shares in the open market.

Yes. Well, I agree, and we try to do what we can do when we can do it. There -- also within the last year was a fairly significant event that was expected to be right on the horizon, which would have made any kind of purchase inopportune. So, you do have restrictions even within a long period of time. But I hear what you're saying, and I appreciate the question.

Okay. Thank you.

Thanks.

Thank you. I’m seeing no further questions. I'll turn the call back over to Mr. Harary for final comments.

Thanks. I'm going to make a few closing remarks, and thank you, Paul. This year, our fee income was up 46% for the first nine months of the year, with automotive income up 81% quarter-over-quarter and up over 120% for the first nine months of the year compared to last year. Ferrari has shown healthy growth in sales in each quarter of this year for the [Indiscernible] and that uses our SPD SmartGlass in the roof and I'm told that further growth is expected in sales in the fourth quarter. We expect revenue in all market segments to increase as new car models, aircraft trains, architectural and other products using our SPD SmartGlass are introduced into the market. And we're very much on our way of becoming cash flow positive and profitable by executing on our business plan. Now there's a lot of analogies between sports and business and perhaps I'm just making this analogy because I have the world series on my mind, but in baseball, less than 2.7% of games are won at the end with a walk-off home run. And in football, less than 10% of Halmari Passes [ph] are completed. Statistically, baseball games and division titles are on mostly by hitting singles. And if you're investing in Research Frontiers based on the battery getting a grand slam home run, it has happened several times, but it's much more likely that your success will come from the singles and doubles and triples that we've hit and all the preparation that has gone into that. We have long-standing seeds placed throughout many industries. And I'm pretty sure that we're well on our way to victory and have a very good team of players throughout the world to get us there. And in keeping with the sports analogy, some of the players on the opposing team are on the injury list and may have even had some career-ending mistakes, but not us. We'll continue to focus on handing singles, doubles and triples and an occasional home run. We also hope to throw in a grand slam from time to time. I hope you'll be enjoying the game with us, and we're working hard to win in all of our industries. Thank you all.