SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q QUARTERLY REPORT PURSUANT TO SECTION 13 OR l5(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 27, 1998 Commission file number 0-19882 KOPIN CORPORATION (Exact name of registrant as specified in its charter) DELAWARE 04-2833935 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 695 MYLES STANDISH BLVD., TAUNTON, MA 02780-1042 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code (508) 824-6696 Not Applicable Former name, former address, and former fiscal year, if changed since last report Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or l5(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [X] No [_] Applicable only to corporate issuers: Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date. Class Outstanding as of July 31, 1998 ----- ------------------------------- Common Stock, par value $ .01 12,185,048
KOPIN CORPORATION INDEX ----- Page No. -------- PART I - FINANCIAL INFORMATION Item 1. Financial Statements Consolidated Balance Sheets at 3 June 27, 1998 and December 31, 1997 Consolidated Statements of Operations for the 4 Three and Six months ended June 27, 1998 and June 28, 1997 Consolidated Statements of Stockholders' Equity for the 5 Six months ended June 27, 1998 and June 28, 1997 Consolidated Statements of Cash Flows for the 6 Six months ended June 27, 1998 and June 28, 1997 Notes to Consolidated Financial Statements 7 Item 2. Management's Discussion and Analysis of Financial Condition 8 and Results of Operations PART II - OTHER INFORMATION Item 4. Submissions of Matters to a Vote of Security-Holders 11 Item 6. Exhibits and Reports on Form 8-K 11 SIGNATURES 12 2
KOPIN CORPORATION CONSOLIDATED BALANCE SHEETS (UNAUDITED) <TABLE> <CAPTION> June 27, 1998 December 31, 1997 ------------- ----------------- <S> <C> <C> ASSETS - ------ Current assets: Cash and equivalents $ 36,586,439 $ 14,425,400 Marketable securities 1,500,000 4,620,884 Accounts receivable, net of allowance of $158,700 and $152,700: Billed 2,733,169 3,209,482 Unbilled 916,985 1,091,806 Inventory 3,314,741 2,720,843 Prepaid expenses and other current assets 877,761 798,867 ------------- ------------- Total current assets 45,929,095 26,867,282 Equipment and improvements: Equipment 27,171,494 22,954,885 Leasehold improvements 808,884 772,717 Furniture and fixtures 347,319 331,955 Equipment under construction 388,402 1,904,198 ------------- ------------- 28,716,099 25,963,755 Accumulated depreciation and amortization 16,732,494 14,869,251 ------------- ------------- 11,983,605 11,094,504 Other assets 4,354,851 3,372,692 Intangible assets 2,111,519 2,059,918 ------------- ------------- Total assets $ 64,379,070 $ 43,394,396 ============= ============= LIABILITIES AND STOCKHOLDERS' EQUITY - ------------------------------------ Current liabilities: Note payable $ -- $ 450,000 Accounts payable 2,015,588 2,683,671 Accrued payroll and expenses 1,512,363 725,187 Current portion of long-term obligations 2,456,106 1,542,818 ------------- ------------- Total current liabilities 5,984,057 5,401,676 Deferred rent -- 165,166 Long-term obligations, less current portion 5,033,631 1,958,968 Minority interest 383,583 -- Stockholders' equity: Preferred stock, par value $.01 per share: Authorized, 3,000 shares; none issued and outstanding Common stock, par value $.01 per share: Authorized, 20,000,000 shares; issued 12,172,936 shares in 1998 and 11,122,143 shares in 1997 121,729 111,221 Additional paid-in capital 108,173,874 90,514,233 Deferred compensation (198,505) (231,955) Accumulated other comprehensive gain (loss) 185,547 (6,001) Accumulated deficit (55,304,846) (54,518,912) ------------- ------------- Total stockholders' equity 52,977,799 35,868,586 ------------- ------------- Total liabilities and stockholders' equity $ 64,379,070 $ 43,394,396 ============= ============= See notes to consolidated financial statements. </TABLE> 3
KOPIN CORPORATION CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) <TABLE> <CAPTION> Three Months Ended Six Months Ended ------------------ ---------------- June 27, June 28, June 27, June 28, 1998 1997 1998 1997 ---- ---- ---- ---- <S> <C> <C> <C> <C> Revenue: Product revenues $ 5,666,895 $ 3,117,474 $ 10,327,579 $ 5,999,551 Research and development revenues 1,017,042 763,800 1,822,905 1,595,736 ------------- ------------- ------------- ------------- 6,683,937 3,881,274 12,150,484 7,595,287 ------------- ------------- ------------- ------------- Costs and expenses: Cost of product revenues 3,511,627 1,971,820 6,234,865 4,083,185 Research and development 2,682,216 2,749,320 5,232,221 5,553,298 General, administrative and selling 961,432 1,102,102 1,953,127 2,188,146 Other 95,731 75,612 187,630 151,224 ------------- ------------- ------------- ------------- 7,251,006 5,898,854 13,607,843 11,975,853 ------------- ------------- ------------- ------------- Loss from operations (567,069) (2,017,580) (1,457,359) (4,380,566) Other income and expense: Interest and other income 548,349 385,844 927,584 700,741 Interest expense (156,189) (56,986) (256,159) (110,515) ------------- ------------- ------------- ------------- Net loss ($ 174,909) ($ 1,688,722) ($ 785,934) ($ 3,790,340) ============= ============= ============= ============= Net loss per share - basic and diluted ($ .01) ($ .15) ($ .07) ($ .35) ======= ======= ======= ======= Weighted average number of common shares outstanding 12,158,768 10,952,879 11,915,323 10,943,782 ========== ========== ========== ========== </TABLE> See notes to consolidated financial statements. 4
KOPIN CORPORATION CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY SIX MONTHS ENDED JUNE 27, 1998 AND JUNE 28, 1997 (UNAUDITED) <TABLE> <CAPTION> Common Stock Additional Accumulated ------------ Paid-in Deferred Comprehensive Shares Amount Capital Compensation Gain (loss) Deficit Total ------ ------ ------- ------------ ------------- ------- ----- <S> <C> <C> <C> <C> <C> <C> <C> Balance, December 31, 1996 10,931,408 $109,314 $88,605,451 ($227,706) $ 44,933 ($48,261,143) $40,270,849 Exercise of stock options 37,996 380 356,848 -- -- -- 357,228 Amortization of compensation relating to grant of stock options -- -- -- 36,360 -- -- 36,360 Net unrealized gain on marketable securities -- -- -- -- 20,212 -- 20,212 Net loss for the six month period ended June 28, 1997 -- -- -- -- -- (3,790,340) (3,790,340) ---------- -------- ----------- ---------- --------- ------------ ----------- Balance, June 28, 1997 10,969,404 $109,694 $88,962,299 ($191,346) $ 65,145 ($52,051,483) $36,894,309 ========== ======== =========== ========== ========= ============ =========== Balance, December 31, 1997 11,122,143 $111,221 $90,514,233 ($231,955) ($ 6,001) ($54,518,912) $35,868,586 Issuance of common stock, net of issuance costs of $1,829,000 1,000,000 10,000 17,161,418 -- -- -- 17,171,418 Exercise of stock options 50,793 508 498,223 -- -- -- 498,731 Amortization of compensation relating to grant of stock options -- -- -- 33,450 -- -- 33,450 Net unrealized gain on other comprehensive income -- -- -- -- 191,548 -- 191,548 Net loss for the six month period ended June 27, 1998 -- -- -- -- -- (785,934) (785,934) ---------- -------- ----------- ---------- --------- ------------ ----------- Balance, June 27, 1998 12,172,936 $121,729 $108,173,874 ($198,505) $ 185,547 ($55,304,846) $52,977,799 ========== ======== =========== ========== ========= ============ =========== </TABLE> See notes to consolidated financial statements. 5
KOPIN CORPORATION CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited) <TABLE> <CAPTION> Six Months Ended ---------------- June 27, June 28, 1998 1997 ---- ---- <S> <C> <C> Cash flows from operating activities: Net loss ($ 785,934) ($ 3,790,340) Adjustments to reconcile net loss to net cash provided by (used in) operating activities: Depreciation and amortization 2,047,303 1,726,596 Amortization of compensation relating to grant of stock options 33,450 36,360 Decrease in unearned revenue -- (46,002) Decrease in deferred rent (165,166) (108,000) Changes in assets and liabilities: Accounts receivable 649,970 1,834,901 Inventory (595,020) 126,411 Prepaid expenses and other current assets (79,287) 247,725 Intangible assets (235,399) (207,981) Accounts payable and accrued expenses 119,639 (2,637,815) ------------ ------------ Net cash provided by (used in) operating activities 989,556 (2,818,145) ------------ ------------ Cash flows from investing activities: Marketable securities 3,126,885 4,248,505 Other assets (982,170) (593,241) Capital expenditures (2,761,651) (1,735,617) ------------ ------------ Net cash provided by (used in) investing activities (616,936) 1,919,647 ------------ ------------ Cash flows from financing activities: Net proceeds from issuance of common stock 17,171,418 -- Net proceeds from issuance of subsidiary stock 582,981 -- Proceeds from notes payable -- 450,000 Principal payment on notes payable (450,000) (500,000) Proceeds from long-term obligations 5,000,000 -- Principal payment on long-term obligations (1,012,049) (961,161) Proceeds from exercise of stock options 498,731 357,228 ------------ ------------ Net cash provided by (used in) financing activities 21,791,081 (653,933) ------------ ------------ Effect of exchange rate changes on cash (2,662) -- ------------ ------------ Net increase (decrease) in cash and equivalents 22,161,039 (1,552,431) Cash and equivalents, beginning of period 14,425,400 16,511,291 ------------ ------------ Cash and equivalents, end of period $36,586,439 $14,958,860 ============ ============ Non-cash investing and financing transactions: Other comprehensive income $ 191,548 $ 20,212 Supplementary information -Interest paid in cash $ 191,651 $ 110,515 </TABLE> See notes to consolidated financial statements. 6
KOPIN CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 1. BASIS OF PRESENTATION --------------------- The financial statements for the six month periods ended June 27, 1998 and June 28, 1997 are unaudited and include all adjustments which, in the opinion of management, are necessary to present fairly the results of operations for the periods then ended. All such adjustments are of a normal recurring nature. Certain reclassifications have been made to the June 28, 1997 amounts to conform to the 1998 presentation including the presentation of interest income, other income and interest expense shown as Other Income and Expense. These financial statements should be read in conjunction with the financial statements and notes thereto included in the Company's Annual Report on Form 10-K filed with the Securities and Exchange Commission (File No. 0-19882) for the year ended December 31, 1997. The results of the Company's operations for any interim period are not necessarily indicative of the results of the Company's operations for any other interim period or for a full fiscal year. The consolidated financial statements include the accounts of the Company and its wholly-owned and majority-owned subsidiaries. All intercompany transactions and balances have been eliminated. 2. NET LOSS PER SHARE ------------------ Net loss per share is computed using the weighted average number of common shares outstanding during the period. Common share equivalents have not been included because the effect would be anti-dilutive. The Company has adopted Statement of Financial Accounting Standards (SFAS) No.128, "Earnings Per Share," which became effective during the fourth quarter of 1997. The new pronouncement's requirements had no impact on the Company's previously reported loss per share. 3. LONG-TERM OBLIGATIONS --------------------- In March 1998, the Company entered into a $5,000,000 term loan which requires the Company to make quarterly principal payments of $250,000 plus interest at a floating rate based upon LIBOR. This term loan is secured by the Company's accounts receivable. 4. STOCKHOLDERS' EQUITY -------------------- In February 1998, the Company completed a 2,000,000 share public offering of its common stock at a price of $19.00 per share. Of the total shares sold, 1,000,000 shares were sold by Kopin and the other 1,000,000 shares were sold by Telecom Holding Co., Ltd. of Thailand. Net proceeds to the Company totaled approximately $17,171,000. 5. RECENT PRONOUNCEMENTS --------------------- In January 1998, the Company adopted SFAS No.130, "Reporting Comprehensive Income," which became effective during the first quarter. SFAS No. 130 requires reporting of comprehensive income, which in the case of the Company, is a combination of reported net loss , the change in the marketable securities valuation, and changes in foreign currency translation adjustments. SFAS No. 130 has no impact on the Company's net loss. Comprehensive loss for the quarters ended June 27, 1998 and June 28, 1997 was $594,386 and $3,770,128. In January 1998, the Company adopted SFAS No. 131, "Disclosure about Segments of an Enterprise and Related Information," which will become reportable during the fourth quarter. The impact of SFAS No. 131 on the Company has not yet been determined. 7
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS ----------------------------------------------------------------------- OF OPERATIONS ------------- Kopin is a leading developer and manufacturer of advanced semiconductor materials and small form factor displays. The Company was incorporated in 1984 to further develop and commercialize certain semiconductor expertise developed at MIT. Historically, the Company has derived most of its revenues from research and development contracts with agencies of the United States government. Beginning in 1995, the Company experienced a significant increase in revenues from sales of its device wafers, and in 1996, revenues from such sales for the first time exceeded revenues from research and development contracts. More recently, the Company has commenced sales of CyberDisplay products. The Company has been unprofitable since inception and, at June 27, 1998, the Company had an accumulated deficit of $55,304,846. RESULTS OF OPERATIONS REVENUES. The Company's total revenues were $6,683,937 and $12,150,484 for the three and six months ended June 27, 1998 compared to $3,881,274 and $7,595,287 during the corresponding periods in 1997, an increase of $2,802,663 or 72.2% for the three months and $4,555,197 or 60.0% for the six months ended June 27, 1998. The Company's product revenues were $5,666,895 and $10,327,579 for the three and six months ended June 27, 1998 compared to $3,117,474 and $5,999,551 for the three and six months ended June 28, 1997, increases of $2,549,421 or 81.8% and $4,328,028 or 72.1%, respectively. Product revenues from sales of the Company's device wafers were $4,551,678 for the three months ended June 27, 1998 compared to $2,830,949 during the corresponding period in 1997, an increase of $1,720,729. Product revenues from sales of the Company's device wafers were $8,937,678 for the six months ended June 27, 1998 compared to $5,656,623 during the corresponding period in 1997, an increase of $3,281,055. The increase in product revenues was due to an increase in sales of HBT device wafers and display products over the corresponding period in the prior year. The increase in sales of the Company's device wafers was primarily due to the increased use of these wafers in various wireless telecommunications products, particularly by the Company's major customer, Rockwell International. Research and development revenues increased 33.2% to $1,017,042 for the three months ended June 27, 1998 compared to $763,800 during the corresponding period in 1997 and increased 14.2% to $1,822,905 for the six months ended June 27, 1998 compared to $1,595,736 for the same period in the prior year. As a result of the expirations of multi-year contracts with the federal government and the Company's increased emphasis on product revenues, the Company believes that research and development revenues will decline as a percentage of total revenues for the near future. COST OF PRODUCT REVENUES. Cost of product revenues, which is comprised of materials, labor and manufacturing overhead related to the Company's products, was $3,511,627, or 62.0% of product revenues, for the three months ended June 27, 1998 compared to $1,971,820, or 63.3% of product revenues, for the same period in the prior year. Cost of product revenues was $6,234,865, or 60.4% of product revenues, for the six months ended June 27, 1998 compared to $4,083,185, or 68.1% of product revenues, for the same period in the prior year. The improvement in cost of product revenues as a percentage of product revenues in 1998 was primarily due to increased sales of device wafers resulting in lower unit costs. RESEARCH AND DEVELOPMENT. Research and development expenses include expenses incurred in support of internal development programs and programs funded by agencies of the federal government, including development programs for display devices and products, device wafers, circuit design costs, staffing, purchases of materials and laboratory supplies, and fabrication and packaging of the Company's display products. Funded research and development expenses were $1,260,016 and $2,316,150 for the three and six months ended June 27, 1998 compared to $660,699 and $1,584,559 for the same period in the prior year, increases of $599,317 and $731,591, respectively. Internal research and development expenses were $1,422,200 and $2,916,071 for the three and six months ended June 27, 1998 compared to $2,088,621 and $3,968,739 during the corresponding period in 1997. The decrease in internal research and development expenses was primarily a result of reduced development costs incurred for fabrication and packaging of the Company's display products. GENERAL, ADMINISTRATIVE AND SELLING. General, administrative and selling expenses consist of the expenses incurred by the Company's business development and sales personnel, marketing expenses, and administrative and general corporate expenses. General, administrative and selling expenses were $961,432 for the three months ended June 27, 1998 compared to $1,102,102 during the corresponding period in 1997, a decrease of $140,670. General, administrative and selling expenses were $1,953,127 for the six months ended June 27, 1998 compared to $2,188,146 during the corresponding period in 1997, a decrease of $235,019. The decrease in general, administrative and selling expenses in 1998 was primarily 8
due to changes in personnel and related expenses. In addition, general, administrative and selling expenses include non-cash charges for compensation expense of $33,450 for the six months ended June 27, 1998 compared to $36,360 in the for the six months ended June 28, 1997 relating to the issuance of certain stock options. OTHER. Other expenses were $95,731 and $187,630 for the three and six months ended June 27, 1998 compared to $75,612 and $151,224 during the corresponding period in 1997. OTHER INCOME, NET. Other income, net was $392,160 and $671,425 for the three and six months ended June 27, 1998 compared to $328,858 and $590,226 during the corresponding period in 1997. The increase was primarily due to increased interest income of $162,505 to $548,349 for the three months ended June 27, 1998 from $385,844 for the corresponding period in 1997 and $226,843 to $927,584 for the six months ended June 27, 1998 from $700,741, resulting from higher cash balances in 1998. These increases were partially offset by increases in interest expense of $99,203 and $145,644 for the three and six months ended June 27,1998 from the corresponding period in 1997 due to additional debt funding obtained by the Company. LIQUIDITY AND CAPITAL RESOURCES The Company has financed its operations primarily through public and private placements of its equity securities, research and development contract revenues, and sales of its device wafers and display devices and products. In February 1998, the Company completed a 2,000,000 share public offering of its common stock at a price of $19.00 per share. Of the total shares sold, 1,000,000 shares were sold by Kopin and the other 1,000,000 shares were sold by Telecom Holding Co., Ltd. of Thailand. Net proceeds to the Company totaled approximately $17,171,000. As of June 27, 1998, the Company had cash and equivalents and marketable securities of $38,086,439 and working capital of $39,945,038 compared to $19,046,284 and $21,465,606, respectively, as of December 31, 1997. The increase in cash and equivalents and marketable securities was primarily due to the public offering of common stock resulting in net proceeds to the Company of $17,171,000 and the receipt of a term loan facility of $5,000,000, offset by an increase in other assets of $982,170, capital expenditures of $2,761,651, and principal payments on notes payable and long-term obligations of $1,462,049. The Company also has approximately $710,000 of marketable securities held in escrow as equipment financing collateral which is shown in other assets. The Company periodically enters into various long-term debt arrangements to finance equipment purchases and other activities. As of June 27, 1998, long-term debt obligations totaled $7,489,737, of which $2,456,106 is payable in the next twelve months. In March 1998, the Company entered into a $5,000,000 term loan which requires the Company to make quarterly principal payments of $250,000 plus interest at a floating rate based upon LIBOR. This term loan is secured by the Company's accounts receivable. In October 1993, the Company entered into a lease for a 74,000 square foot manufacturing facility. This facility, which includes 10,000 square feet of environmentally controlled clean rooms, is used primarily for the Company's production of display devices. This facility is occupied under a lease that expires in October 2000, with renewable options for up to four additional years at the Company's election. The Company will make lease payments of approximately $1.0 million per year over the remaining term of the lease. The Company expects to expend approximately $5,000,000 on capital expenditures over the next twelve months, primarily for the acquisition of equipment relating to the manufacturing, packaging and testing of CyberDisplay products and production of the Company's device wafers. RECENT ACCOUNTING PRONOUNCEMENTS In January 1998, the Company adopted SFAS No.130, "Reporting Comprehensive Income," which became effective during the quarter. SFAS No. 130 requires reporting of comprehensive income, which in the case of the Company, is a combination of reported net loss, the change in the marketable securities valuation, and changes in foreign currency 9
translation adjustments. SFAS No. 130 has no impact on the Company's net loss. Comprehensive loss for the quarters ended June 27, 1998 and June 28, 1997 was $594,386 and $3,770,128. In January 1998, the Company adopted SFAS No. 131, "Disclosure about Segments of an Enterprise and Related Information," which will become reportable during the fourth quarter. The impact of SFAS No. 131 on the Company has not yet been determined. FUTURE OPERATING RESULTS The Company is conducting a review of its computer systems to identify those areas that could be affected by the "Year 2000" issue and is developing an implementation plan to resolve the issue. The Company presently believes, with modification to existing software and converting to new software, the Year 2000 problem will not pose significant internal operational problems. However, even if the internal systems of the Company are not materially affected by the Year 2000 problem, the Company could be affected through disruptions in the operation of the enterprises with which the Company interacts. As such, there can be no assurance that the Year 2000 problem will not have a material adverse effect on the Company's business, financial condition or results of operations. Certain of the statements contained in this Form 10-Q, including Management's Discussion and Analysis of Financial Condition and Results of Operations, are forward-looking statements that involve risks and uncertainties. In addition to the risks and uncertainties set forth in this Form 10-Q, other factors that could cause actual results to differ materially include the following: general economic and business conditions and growth in the flat panel display industry and the gallium arsenide integrated circuit and materials industries, the impact of competitive products and pricing, availability of third party components, availability of integrated circuit fabrication facilities, cost and yields associated with production of the Company's CyberDisplay imaging devices and device wafers, loss of significant customers, acceptance of the Company's products, continuation of strategic relationships, Year 2000 matters, and the risk factors and cautionary statements listed from time to time in the Company's periodic reports and registration statements filed with the Securities and Exchange Commission, including but not limited to the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1997. 10
PART II. OTHER INFORMATION Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY-HOLDERS On May 21, 1998, the Company held an Annual Meeting of Stockholders to consider and vote upon the following three proposals: (1) A proposal to elect seven directors of the Company to serve until the next Annual Meeting of Stockholders and until their successors are duly elected and qualified. (2) A proposal to ratify the amendment to the Company's 1992 Stock Option Plan increasing the number of shares authorized for issuance under the Plan. (3) A proposal to ratify the appointment of Deloitte & Touche LLP as independent accountants of the Company for the current fiscal year. Results with respect to the voting on each of the proposals were as follows: <TABLE> <CAPTION> For Withheld Authority --------- ------------------ <S> <C> <C> Proposal 1: John C.C. Fan 9,851,601 410,033 David E. Brook 9,854,301 407,333 Andrew H. Chapman 9,854,301 407,333 Morton Collins 9,852,451 409,183 Chi Chia Hsieh 9,682,671 578,963 Michael A. Wall 9,854,301 407,333 Vallobh Vimolvanich 9,678,571 583,063 </TABLE> Proposal 2: 9,281,927 votes for; 939,098 votes against; 40,609 abstentions; and 0 broker non-votes. Proposal 3: Proposal 3: 10,213,570 votes for; 25,850 votes against; and 22,214 abstentions; and 0 broker non-votes. Item 6. EXHIBITS AND REPORTS ON FORM 8-K (a) Exhibits 10.44 Amendment to 1992 Stock Option Plan 10.45 Joint Venture Agreement, by and among the Company, Kowon Technology Co., Ltd., and Korean Investors, dated as of March 3, 1998 10.46 Amended and Restated Employment Agreement between the Company and Dr. John C.C. Fan, dated as of February 20, 1998 27 Financial Data Schedule (b) Reports on Form 8-K None 11
SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. KOPIN CORPORATION (Registrant) Date: August 7, 1998 By: /s/ John C.C. Fan __________________________ John C.C. Fan President, Chief Executive Officer and Chairman of the Board of Directors Date: August 7, 1998 By: /s/ Kathleen A. Ellison __________________________ Kathleen A. Ellison Controller 12