<PAGE> 1
Exhibit 99.1
[ILLINOIS SUPERCONDUCTOR CORPORATION LOGO]
CONTACT: Maureen Murnane
PHONE: 847-391-9426
INTERNET: [email protected]
ILLINOIS SUPERCONDUCTOR'S NEW TOWER TOP HTS FILTER
PURCHASED FOR SPAIN'S TELEFONICA NETWORK IN
WORLD'S 1ST COMMERCIAL TOWER-MOUNT APPLICATION
OF SUPERCONDUCTING TECHNOLOGY FOR GSM
Mt. Prospect, IL (September 21, 2000) - Illinois Superconductor Corporation (OTC
BB: ISCO), a supplier of high-temperature superconducting (HTS) systems to the
wireless industry, announced today that it has received an initial order for the
deployment of HTS filter systems by Telefonica, the leading telecommunications
operating company in Spain. This order was placed through ISC's Spanish
distributor, Iberica de Control y Telefonia, S.A. (ICT), for delivery in the
fourth quarter of this year. The order comes after an extensive field trial of
ISC's SupeRx tower-mounted HTS system, carried out last year by Telefonica in
two live sites in Cordoba, Spain.
"This trial involved a live GSM system serving real users, in challenging
real-world field conditions," commented Dr. George Calhoun, Chief Executive
Officer of Illinois Superconductor. "Telefonica is one of the largest mobile
communications operators in the world, and a world-class GSM operator. To my
knowledge, this is the first time an HTS system has been deployed for use in a
GSM network. Moreover, the trial results were extremely impressive. We saw an
improvement in uplink signal levels of more than 15 dB, and a reduction in
mobile transmit power of 7 dB or more, with significant range extension. These
are very significant indices of the overall reduction in interference within the
system, and I expect that this will be an eye-opener for other GSM operators."
Vincente Fernandez Bueno, Director General of ICT stated, "The solid performance
of the SupeRx tower-top system in the field trials provided the basis for this
order. Our partnership with ISC will continue to develop opportunities for ISC's
product line in Spain and Latin America through our long standing relationship
with Telefonica and its Latin American affiliates."
Dr. Calhoun continued, "GSM is the largest segment of the 2G market, much larger
worldwide than the CDMA segment in the United States. Some have voiced the
opinion that because GSM is based on TDMA, it would show smaller benefits than
CDMA from superconducting front-end technology. However, the results we see from
these tests are equal to or even somewhat larger than the similar measurements
in our CDMA tests. I think this indicates that there will be a significant
market for HTS systems in GSM networks. There are perhaps five times as many
<PAGE> 2
GSM base stations worldwide as CDMA base stations, so this should develop into a
real opportunity for HTS.
"The test also helps validate the importance and viability of the tower-top
configuration. By placing the HTS front-end at the top of the antenna tower, we
can gain back the half or more of the signal that is normally lost just due to
the co-axial cable runs from the tower-top to the base station. The HTS
front-end system means that the signal is amplified without also amplifying the
interference (which is what happens with conventional tower-top amplifiers). So
both the range and the quality are improved.
"This tower-mount configuration was one of the drivers for our recent
acquisition of Spectral Solutions Inc. We also acquired a strong patent
portfolio covering the tower-mount HTS application, which makes us the sole
supplier of tower-mount HTS systems in the world. In fact, I am pleased to also
be able to announce that one of the key patents on this invention was issued to
us by the U.S. Patent office just last week. We are continuing to build and
expand our intellectual property portfolio in this direction, as we are in other
parts of our business.
"Finally, although this transaction involves a relatively small order in itself,
it does represent the conversion of a trial customer into a paying customer, and
the significance of the Telefonica testing results will hopefully help to open a
new market segment for us."
Iberica de Control y Telefonica, S.A. (ICT), is a division of the Iberica Group
that was founded in 1963 in Madrid, Spain. Serving as the commercial arm of the
Iberica Group, ICT develops, manufactures, markets and distributes
telecommunications equipment to Telefonica and its foreign affiliates in Spain
and Latin America. For additional information on the Iberica Group, please visit
their web site at www.interisa.es.
ISC offers its products in a range of configurations, supporting all cellular
and PCS bands, with and without notch filters, and with or without cryogenic
low-noise amplifiers. Its products include the smallest HTS filter systems on
the market today, as well as the only failure-proof all-temperature HTS filter
architecture, our patented ATP(TM) system. ISC has sold more than 300 systems to
operators in the U.S., with continuing field trials indicating future
deployment. In addition, ISC is developing ultra-high-performance
superconducting front-end products, including both transmitter and receiver
products. The emerging third generation of 3G wireless systems is expected to
replace current wireless systems in the next several years.
ISC is a leader in the commercialization of high temperature superconducting
technology for the wireless telecommunications industry. The Company develops,
manufactures and markets radio frequency (RF) products to enhance the quality
and capacity of cellular telephone, personal communications services and other
wireless telecommunications services. More information about ISC is available on
the Company's internet web site at http://www.ilsc.com.
Statements contained in this news release that are not historical facts are
forward-looking statements. Such forward-looking statements are made pursuant to
the safe harbor provisions of the Private Securities Litigation Reform Act of
1995 and reflect the Company's current expectations regarding the future results
of operations, performance and achievements of the Company. The Company has
tried, wherever possible, to identify these forward-looking statements by using
words such as "anticipates," "believes," "estimates," "expects," "plans,"
"intends," and similar expressions. These statements reflect the Company's
current beliefs and are based on information currently available to it.
Accordingly, these statements are subject to certain risks, uncertainties, and
contingencies, which could cause the Company's actual results, performance or
achievements for 2000 and beyond to differ materially from those expressed in,
or implied by, such statements. These important factors include, without
limitation, the ability to integrate SSI's and ISC's businesses; the Company's
history of net losses and the lack of assurance that the Company's earnings will
be sufficient to cover fixed charges in the future; the degree to which the
Company is leveraged and restrictions imposed on the Company under its existing
debt instruments which may adversely affect the Company's ability to finance its
future operations; uncertainty about the Company's ability to compete
effectively against better capitalized competitors and to withstand downturns in
its business or the economy generally; the adverse effects on liquidity of the
Company's common stock because of its de-listing from the NASDAQ National Market
in June 1999; continued downward pressure on the prices charged for the
Company's products due to the competition of rival manufacturers of front-end
systems for the wireless telecommunications market; the
<PAGE> 3
timing and receipt of customer orders; the Company's ability to attract and
retain key personnel; and the effects of legal proceedings. A more complete
description of these risks, uncertainties and assumptions is included in the
Company's filings with the Securities and Exchange Commission, including those
described under the heading "Risk Factors" in the Company's Annual Report on
Form 10-K for the fiscal year ended December 31, 1999. The Company undertakes no
obligation to update or revise these forward-looking statements to reflect new
events or uncertainties.
