Frequently Asked Questions Table of Contents
(Click a topic to go to that information):

1. General Company Related Information

2. Investment Information

3. MicroFuel Cell Information

4. Novars Fuel Cell Technology Information

5. Novint / e-Touch™

1. General Company Related Information:
Q. What is the relationship between Projectavision, Inc. and Manhattan Scientifics, Inc.?

Subsequently, the Projectavision board of directors determined that they would acquire another company more closely aligned with their Home Theater display industry. Short on cash, and with the assistance of former chairman Maslow, Projectavision sold off its Manhattan Scientifics shares, most of which Maslow carefully placed in the hands of long-term institutional investors. Projectavision raised the cash it needed and completed its acquisition of Vidikron Industries, S.A. Today, Manhattan Scientifics shares are more widely held and distributed, and Maslow's time and focus is directed to Manhattan Scientifics.

Q. What is the relationship between Manhattan Scientifics, Inc. (MHTX) and Energy Related Devices, Inc. (ERD)?

A. Robert G. Hockaday, inventor of the MicroFuel Cell™, incorporated Energy Related Devices in 1997 in order to facilitate the development of his MicroFuel Cell idea. His first fuel cell patent was granted in 1987.

Manhattan Scientifics entered into an exclusive contract with ERD in January 1998. It acquired the world rights to the MicroFuel Cell patents and inventions together with the Hockaday development team commitment to complete the invention to a finished, working prototype. MHTX's obligation is to provide capital, management, equity and royalties to Mr. Hockaday who became the largest individual shareholder in MHTX.

The entire fuel cell engineering development team is actually employed by ERD. Hockaday remains as President of this corporation, which is a sub-contractor to Manhattan Scientifics, Inc. 

MHTX does not own part or all of ERD. MHTX owns all the intellectual property, all the patents, issued, filed, and to be filed. Anything related to the micro fuel cell is or will become the property of MHTX. Accordingly, all future profit earned by commercializing the MFC will belong to MHTX. In exchange for this ownership, ERD /Bob Hockaday has received (i) funding for the project, including all payroll, rents, cost of patenting, etc. (ii) a large block of MHTX shares, (iii) a royalty agreement to pay Hockaday on future commercial sales made by MHTX.

Since MHTX owns all properties, patents, etc. ERD will not entertain an IPO, at least not related to the micro fuel cell. They could develop something else in the future away from the MFC and away from certain others inventions created by Hockaday, which are also owned by MHTX.

All of the above has been disclosed in our Federal filings in the form of our 10K.

Q. Re: Corporate strategy for growth: Will MHTX continue to add new technologies to its incubator?

A. Yes, but only when opportunities exist for substantial global business opportunities.
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2. Investment Information
Q. Are the Company shares liquid? Do they trade often? Where are they traded?

A. Over 37 million shares have exchanged hands in the first 11 months since we went public in January 1998. This suggests widespread interest in the work we are doing at our Los Alamos based facility. The MHTX shares are traded on Nasdaq's OTC Bulletin Board marketplace.

Q. Is Manhattan Scientifics a "reporting" company? Does it report its progress and financial results to the SEC? 

A. Today MHTX is a reporting company. It files 10Q's and 10K's (audited quarterly and annual financial statements) with the SEC.

Q. Is it "risky" to purchase Manhattan Scientifics (MHTX) shares? 

A. Absolutely! MHTX is a development stage R&D company. Presently it has no product to sell, and has no revenue or earnings. Purchase of such shares are considered high risk, and should only be considered by competent professionals. The market has given us a very high valuation...very high marks for a company who has not yet performed. Wall Street is betting that we will perform. I have structured the company as an incubator and we have a number of technology "horses" running. This was done to diversify your high risk investment; to spread your risk over several differing ideas in the hope that one or more will ultimately succeed. Neither we or anyone else knows the answer to this key issue. Our NovArs GmbH activity in Germany is now closest to commercial success. But there is a long way to go. The investment risk is not only limited to the quality of our technologies or people. You would also be exposed to the market risks. A strong downdraft in the market could prevent us from raising future capital to fund our work. We could run out of fuel. You should be aware of these and other risks before making an investment into an early stage company like MHTX.

Q. Many young technology companies have good ideas, patents, great engineers, and never become successful investments for their shareholders. Why are you different?

A. We have tried to blend top quality engineering and inventiveness with skilled, experienced business management. A good example of the process was the Company's recruitment of Jack Harrod, a 32-year veteran of Texas Instruments who is now the Company's Chief Operating Officer (COO). Working closely with CEO Maslow, Jack Harrod is "pushing" the engineering development and driving it over the finish line. The team is supported by a capable and experienced board of directors, patent and SEC lawyers. Management maintains good contacts on "Wall Street" and has proven its ability to raise necessary capital, the prime ingredient of success in young companies. The Company "went public" in order to provide access to the capital market. We are in Los Alamos, NM to be close to and to access the vast scientific and engineering talent pool that exists at the US Government Laboratories in Northern New Mexico. 

Q. Do you have airtight patents?

A. I don't know if there is such a thing as "airtight". We believe we are well protected, but the real test always comes in the courtroom. We do maintain patent insurance which will pay the huge cost of legal defense if we are infringed. My own thoughts are that it would be easier and less costly for a large corporation to do a licensing deal with us rather than try to design around our patents. We would pursue against any infringer with passion and without mercy.

Q. Given the answers to the last question, do you still consider this a "risky' investment ?

A. Yes. There is nothing more common than unrewarded talent. But we are dedicated to do everything we can to drive the company to success and profit. Our shareholders own this company; we know it and our intention is to make their investment work.

Q. Will MHTX eventually list on Nasdaq?

A. This is our goal.

Q. Does the Company have sufficient capital to continue its growth plan?

A. We have been able to access the capital market to continue to raise new capital to fuel our needs. This, more than any other reason, is the reason we are a public company.

Q. Is there a good way for shareholders and would-be shareholders to learn about how others feel about Manhattan Scientifics?

A. Manhattan Scientifics policy has been to avoid investor and stock broker promotion. The Company does not have any paid stock-touts or investor-relations promoters. The Company's press releases are infrequent as well. We maintain a policy of publishing news only when it is real news; nothing frivolous. Management does make itself available to answer questions. Frank Hawkins at Hawk Associates is the Company's Institutional Investor Relations person and is authorized to answer shareholder questions. Mr. Hawkins may be reached by telephone at (305) 852-2383 and by e-mail at info@hawkassociates.com.
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3. MicroFuel Cell Information
Q. Can the Hockaday fuel cell technology be used to make the equivalent of the standard car battery with enough energy to start and power a car?

Q. Can your fuel cell be made to work with gasoline?

Q. Can your fuel cell technology be applied to very large applications, such as replacement of the internal combustion engine?

Q. Can your fuel cell be run from natural gas?

Q. Besides lasting longer and being refueled instead of recharged, how will your fuel cell be different from conventional batteries and can they be used in all applications conventional batteries are used in now?

Q. If your fuel cell "breathes" does that mean that there is some sort of exhaust? And if so, would there be noticeable condensation? 

Q. If your MicroFuel Cell uses methanol as a fuel, wouldn't it be considered a combustion hazard? 

Q. RE: MicroFuel Cells: When will the Company bring its first product to market? How? 

A. The company's business Plan is to first develop a small, portable, fuel-cell-powered charger. This device, to be built into a fitted carrying holster for a cellular phone, will constantly charge the phone's conventional battery, thus creating an "always on" powered telephone. In this manner, the company will not immediately challenge the battery industry. Instead it will compliment it. Manhattan Scientifics would like to eliminate the word and the memory of AC electrical wall-plug recharging. Management believes that it will be successful in "partnering" with a major strategic corporation within the battery, telecommunications, consumer electronics, or chemical industries. Manhattan Scientifics is not sufficiently capitalized to manufacture and distribute its fuel cell products alone. Once a committed, well capitalized corporate partner has been identified and a working relationship secured, management intends to have its fuel cell products mass produced and distributed by larger organizations. Management's goal is to see first products enter the marketplace as soon as the above criteria is met.

Q. Does the fuel cell product work yet or is it theory?

A. It works. We have a demonstration breadboard prototype in our lab. We've tested it and made phones calls with it. Shareholders and interested parties can arrange to visit us and see it/use it.
Q. Is there any competition?

A. There is a fellow called Manny Tsoupanarias who maintains a terrific website listing all fuel cell news and listing reports on our competitors. I think it best to answer your question by referring you to that site: http://www.fuelcellsworks.com

Q. Is it commercially viable ?

A. Not yet. We believe it will be soon.
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4. NovArs Fuel Cell Technology Information
Q: What is special about the fuel cell work underway at your company's NovArs GMBH unit in Germany?

Special proprietary water retention methods are utilized to keep the proton exchange membrane hydrated. The NovArs fuel cell is designed to operate under ambient pressure conditions; thus avoiding complex pumps and controls. Conventional cells use pressure pumps to circulate and pressurize the fuel-side of the stack, adding more complex parts and structure. Our IP allows us to avoid these complexities.

For applications requiring low power, no cooling fans are required in the NovArs design and patent. This too is unique.

The NovArs device offers superior power density. This means more power output from less weight. Thus portability is emphasized; High wattage output from a light weight device. (i.e. use in cordless portable power tools, communication devices, portable electronic needs, bicycles, eventually laptop computers and cellular phones.

At present the NovArs fuel cell will operate with hydrogen fuel utilizing a variety of sources ranging from pressurized fuel containers to more advanced metal hydride cartridges. Future considerations and approaches might involve direct methanol as fuel. The Hockaday team and Koschany team intend to work closely to achieve a hybrid product design. Manhattan Scientifics, along with many others, are at work to develop hydrogen fuel sources featuring safe use of hydrogen. Presently Federal regulations prohibit the use of hydrogen on commercial airplanes.

NovArs is developing a prototype fuel cell system designed to power a bicycle for use in Asia and other bicycle markets.

NovArs GMBH employs a staff of 10, including full and part time engineers and technicians. The Company is located outside Passau, (near Munich) Germany. Dr. Arthur Koschany is the principal investigator. Telephone:011 49 8505 91780 and fax: 011 49 8505 917820.
email: novars@t-online.de

Q. Re: Why did you acquire the German NovArs fuel cell technology?

Our strategy was to add Dr. Koschany's corporate activity/development to our portfolio because it's power output begins where Robert Hockaday's leaves off, and ultimately will provide up to 3 KWT's electric power. Our press release on August 10, 1999. offered these details:

Los Alamos, NM, August 10, 1999 - In a move that significantly expands the scope and speed of its development efforts, Manhattan Scientifics, Inc. (OTC BB: MHTX) today announced that it has acquired the intellectual property, exclusive worldwide commercial development rights, and pending patents to the mid-power-range fuel cell technology of NovArs Gessellschaft fuer neue Technologien, GmbH, a private company based in Passau, Germany.

Terms of the agreement were not disclosed. The company will fund a research and development contract for NovArs, scheduled to begin September 5, 1999 by agreement with its principal owner, physicist Dr. Arthur Koschany. This includes construction of a next-stage-working prototype of the technology that will be efficient, easy to handle, and appropriate for mass production and worldwide distribution. Prototypes are scheduled for completion in the spring of 2000.

The NovArs technology and prototype was demonstrated at the Small Fuel Cell Conference held in Lucerne, Switzerland in June 1999. The NovArs technology is focused on producing a lighter weight, small stack fuel cell compared to conventional stack fuel cells. It is powered by hydrogen that operates under ambient conditions and produces power output ranging from 3 to 3,000 watts (3 KW). This power level is ideal for high current, low voltage applications such as laptop computers, portable electronics, cordless power tools, wheel chairs, golf carts, electric bicycles, and remote site locations. 

As the technology evolves, it may also power higher wattage applications - NovArs is currently under contract with a major German industrial firm to work on a stationary fuel cell in the 2 to 3 KW range, which could potentially power a complete home energy supply system.

The current fuel cell development work at the Manhattan Scientifics laboratories in Los Alamos, NM, under the direction of Robert Hockaday, its Chief Fuel Cell Scientist, is focused on non-stacked flat fuel cell configurations, powered by methanol. This technology is ideal for low current, high voltage uses that require outputs below one watt of power, such as cellular telephones, pagers and other microelectronics. 

Manhattan Scientifics successfully demonstrated a pre-prototype of its MicroFuel Cell technology last December by completing a fuel-cell-driven cellular telephone call. Work is currently underway to build an actual size prototype of a cellular phone powered by fuel cells, scheduled to be unveiled this fall.

Marvin Maslow, Chief Executive Officer of Manhattan Scientifics, Inc., stated, "we believe there is tremendous potential offered by the parallel pursuit of both promising fuel cell devices, as well as the synergies we believe will occur as our two fuel cell development teams work together and share ideas.

"This is a significant expansion of our energy opportunity, targeting the next power level -- a high powered fuel energy system, powered by methanol," he added. 

According to Maslow, the driving force behind the agreement with NovArs was Jack Harrod, a 30-year veteran of Texas Instruments, Inc. (NYSE: TXN), who was recruited in 1998 as Manhattan Scientifics Chief Operating Officer to identify and commercialize promising technologies, similar to his successful history at Texas Instruments.

"Our NovArs team is pleased to join the Manhattan Scientifics family of scientists, engineers and business people," stated Dr. Koschany. "We recognized a great many opportunities to apply innovative fuel cell technology to the portable energy business, and we look forward to combining our skills with Manhattan Scientifics to achieve our mutual goal." NovArs has filed four patents to protect its mid-power-range fuel cell inventions.

"I am eager to begin working with Dr. Koschany and his talented scientific team to produce innovative fuel cell systems," said Robert Hockaday, the Chief Fuel Cell Scientist at Manhattan Scientifics. "He has shown real skill, energy and intelligence in pursuing his discoveries."

A. Similar to the model established with Robert Hockaday and his company, Energy Related Devices, Inc., Manhattan Scientifics entered into an exclusive contract with NovArs. It acquired the world rights to NovArs' pending patents and inventions, together with Dr. Koschany's development team commitment to complete the inventions and build working prototypes. MHTX's obligation is to provide capital, management, equity and royalties to Dr. Koschany. This model acquisition-strategy and methodology allows the entrepreneurial scientist to manage his/her own enterprise, plan, budget, hire & fire, and in general, be responsible for production of the goal / result. It also provides full ownership of all Intellectual Property/ patents, existing and future, to Manhattan Scientifics.
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