Key XsunX Milestones

1. In May of 2004, the Company produced working model samples of its semi-transparent photovoltaic glazing process that exceeded 4% electrical conversion efficiency rates. These working models established the basis for process and cell refinement that the Company believes may provide conversion efficiencies of 6% or greater.
   
2. The development of working models provided the foundation for commercial viability showing that the XsunX process may provide an almost 100% efficiency-to-cost gain that may, for the first time, provide return on investment or “ROI” ratios that make sense. This 100% gain in efficiency-to-cost is based on Company estimates of Power Glass™ solar cells operating at as much as 50%, or half, the efficiency of conventional opaque amorphous solar cells yet costing as little as 25%, or one fourth, to produce. Final cost to efficiency analysis will be determined upon completion of development.
   
3. In June 2004, the Company negotiated an at-cost cooperative venture with MVSystems, Inc., a Colorado based corporation that designs, builds, and delivers state-of-the-art manufacturing tools designed specifically for the thin film semiconductor market. MVS is equipped with both the technical staff and tools necessary for the development and commercialization of the XsunX glazing process. The terms of the working relationship provide XsunX with complete R&D facilities without mark-up for profit on the use of staff and equipment. This helped XsunX to avoid costly outlays of capital by eliminating the need to duplicate similar facilities.
   
4. In June 2004, the Company launched Phase Two of its R&D efforts under the guidance of Dr. Arun Madan as Chairman of the XsunX Scientific Advisory Board. This plan called for an approximate nine month R&D cycle that at its conclusion is anticipated to provide the Company with demonstrable products and the ability to begin licensing and sales efforts.
   
5. As of the end of July 2004, the Phase Two development plan had accomplished the successful development of large area manufacturing processes for each of the multiple layers that make up the XsunX solar cell design. This was a big step in moving towards a commercially viable process.
   
6. In September 2004, the Company entered into a royalty free agreement for the licensing of a portfolio of patents and technologies that cover a wide area of both solar cell structure, design and manufacturing processes. These intellectual properties were developed under the guidance of Dr. Arun Madan whose 30 plus year career in the solar industry began with the creation of the first amorphous solar cell in the early 1970’s.
   
7. On-going development is now underway to establish viable manufacturing techniques for increasing the active power producing ratios of the glazing to as near 100% as possible (i.e. the percentage of total area coated by the glazing that converts sunlight to usable electrical energy as compared to the total size or area of glass or other transparent substrates covered by the glazing).
   
8. In November 2004, the Company launched development efforts for the Power Glass™ process on thin films. This area of research and development represents significant commercial importance for the company. By combining the ability to manufacture semi-transparent solar cells on thin-film inexpensive plastics with the use of patented reel-to-reel cartridge manufacturing systems, the commercial viability gains are anticipated to be significant.