Applied Nanotech Holdings, Nanofilm Announce Plan to Merge in a Stock Swap Transaction

Applied Nanotech Holdings, Inc. (APNT), a global leader in nanotechnology research and development, and Nanofilm, Ltd., a private company with a leading market position for specialty optical coatings, cleaners and nano-composite products, jointly announce they have signed a letter of intent to combine through a stock swap transaction.

The new combined company will have expanded capability to deliver innovative nanotechnology-based products. The new company will build on the 25-year success of Nanofilm in developing and commercializing technologies that enhance a variety of consumer and industrial products.

APNT and Nanofilm will combine their technologies and commercialization capabilities to create a broad array of next generation products. Based on 2012 pro forma financials, assuming the merger had occurred at the beginning of 2012, the new combined company would have 2012 revenues exceeding $14 million. The new company will have the personnel, development facilities, operating facilities, and customer relations to support its projected rapid revenue growth.

The new company’s chairman and CEO will be Dr. Scott Rickert, who holds similar positions with Nanofilm.

“I’ve long had a vision for a growth company using nanotechnologies producing high margin products,” said Dr. Rickert. “I am enthusiastic to have this expanded base to enhance the growth of this new combined company, selling nanotechnology products in the worldwide marketplace.”

“Both APNT and Nanofilm bring valuable resources to this union,” said Dr. Robert Ronstadt, APNT’s chairman. “APNT has outstanding R&D capabilities while Nanofilm brings strong management, manufacturing, marketing, and sales capabilities. This is an ideal combination for both companies.”

“I am excited about the opportunities that await us as I join in the creative efforts of the new innovation team that Dr. Rickert is establishing to develop and commercialize nanotechnology-enhanced products,” added Dr. Zvi Yaniv, president and chief operating officer of APNT.

The closing of the proposed merger is conditioned upon APNT and Nanofilm obtaining working capital financing; completion of due diligence; signing of a definitive merger agreement containing customary representations, warranties, and closing conditions; SEC approval of APNT’s proxy statement; approval by the respective boards of directors; approval by the shareholders of APNT; and approval by the members of Nanofilm.