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Xplore Technologies®Key Information
Headquarters Austin, TX
Founded 1996
Nasdaq Since 2012 XPLR
http://www.xploretech.com
Company Profile• World Leader and Innovator in Rugged Tablet PCs for over 15 years
• Setting New Standards for “Real World Rugged”
• First with Auto-Sensing Dual-Mode Input – Active Pen / Finger Touch
• Pioneer of the Best Outdoor-Viewable Displays – 600:1 Contrast Ratio / 1000 NITS
• Rugged and Expansive Docking / Mounting Options (planes, trains, etc.)
• RAID capability – Redundancy and Performance
• Intel® Core™ i7 – First-to-Market in Rugged Tablet
• First to Market with HDMI-In for Cable & Satellite Providers (RangerX)
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KEY EXECUTIVES Over 140 Years in High Tech Experience
Philip S. Sassower (Chairman + CEO). Current: CEO of Phoenix Group, a private equity firm and Xplore’s largest shareholder; Chairman and CEO of Communication Intelligence Corporation, an electronic signature provider. Past: Newpark Resources, Inc., an environmental services company; and Bates Manufacturing Company, Inc., a textile and coal company.
Mark Holleran (President + COO). Past: President and CEO of Wavestat Wireless Inc., a developer of wireless products; Country Manager, VP Sales + Marketing of Cabletron Systems, a manufacturer of communication solutions; and Various Senior Management & Executive roles at Digital Equipment Corp.
Jim Plas (VP Marketing). Past: VP of Marketing and Product Management, Acxiom, the leading global marketing services firm; Director of Enterprise Services Marketing, Dell; and Business Development Director, Dell Professional Services
Michael J. Rapisand (CFO + Corporate Secretary). Past: CFO of TippingPoint Technologies, Inc., a network-based security hardware manufacturer; CFO of ThinkWell Corporation, an online publisher; Finance Director of Dell.
Steven C. Linahan (VP Operations). Past: Vice President, Operations/Supply Chain for TippingPoint Technologies, Inc.; Director, Supply Chain for ClearCube Technology, Inc, a leader in centralized computing and desktop virtualization.; and Director, Supply Chain-Director, Strategic Business Unit at SMTC, Inc., a global EMS provider.
Bryan J. Bell (VP Engineering). Past: VP Operations at Sirific Wireless, a developer of solutions for mobile cellular and broadband data for notebook computers; DSL Engineering Team Leader at Texas Instruments; VP + General Manager of the notebook computer business of Acer Advanced Labs, Inc.
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Traditional Market for Rugged TabletOil Field Pipeline Inspectors
Field Install & Repair Techs
First Responders / EMS
Military Operations & Spec Ops
Warehouse Inventory Managers
Forklift Drivers
Pharmaceutical Scientists
Doctors & Nurses
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Xplore : Most Rugged Tablets in the Market
iX140C5 Series:Waterproof: 30 minutes at 3 FeetCan withstand 7’ Drop and maintain operational statusReadable in Direct SunlightReal time data access from any location - Always- On Connectivity with up to four radiosThermal ranges of -40 to 167 degrees Fahrenheit.
RangerX SeriesMost Powerful Rugged Android Tablet in the Market
Fastest Processor – Dual Core 1.5 GHzMost Storage capacity – up to 192GBBest drop rating – can survive a 4’ drop operating
Water and Dust Resistant Brilliant sunlight readable displayOnly tablet with HDMI-In & Gigabit Ethernet – perfect for Telco & Cable
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Xplore – Differentiation is in our DNA
Most Powerful Chip in Class Ensuring the Longest Use Life – RangerX & iX104C5
Only True Field Repairable and Field Upgradable Rugged Tablet – iX104C5
Expansive Rugged Docking Options – RangerX & iX104C5
Low Total Cost of Computing and High ROI – RangerX & iX104C5
Ability to Tailor Design Configurations for Customers
Only company to offer HDMI-In & Gigabit Ethernet
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Xplore – Strength in RelationshipsStrategic Development Partners Mature Resellers
Recent Wins and AnnouncementsMultiple millions of dollars in US Military orders, recently won first major program award
Multiple millions of dollars in orders from Medical Equipment Manufacturer in an OEM relationship
Continued expansion of $17M+ AT&T relationship
4 out of 5 Star Review from Laptop Magazine on recently announced DMSR M2 Military Tablet http://www.laptopmag.com/reviews/tablets/xplore-ix104c5.aspx
Expanded OEM relationship with Novatek to deliver a Bio-Pharmaceutical Solution http://finance.yahoo.com/news/xplore-novatek-partner-rugged-tablet-131500850.html
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Story of Two Markets: Convergence is Inevitable$136B Consumer/Commercial
Tablet Market (20161)$6.9B Rugged
Mobile Market (20161)
Dominated by Apple with 69% of the Market (17 M Units
shipped in Q2) - IDC
Driven by media consumption but moving toward Enterprise
Productivity via “Bring your own Device” trend - IDC
Plagued with high failure rates (up to 20%2) and non Enterprise-
Friendly software
Continuing to grow at a rapid and unpredictable pace
Panasonic is the share leader, with roots in the Rugged laptop
space - VDC
Tablets to grow fastest among all rugged mobile computing
devices - VDC
Designed for durability, always on connectivity and Enterprise
Management
Tablet leadership up for grabs due to changing vendor landscape
(1) Source: VDC – 2012(2) 9.8% caused by accidental damage in first year, 20% in year two, according to SquareTrade Warranty
statistics
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Converging Markets = Paradigm Shift
~$500M Rugged Tablet Space
$6.9B Total Rugged Mobility
$136B Consumer/ Commercial Tablet
• Tablet Sales will Overtake Those of Personal Computers by 2015 – The Yankee Group
• Over 95 Million Tablets shipped in 2012 – DigiTimes Research
• iPad Sales to Fortune 500 have Tripled in Last 12 months – Apple CFO
• The Rugged Tablet is the Fastest Growing Form Factor in the Rugged Market - VDC
Information as of 2012
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Paradigm Shift = New Market OpportunityTraditional Segmentation Lines are Blurring…• Commercial Tablets are Moving into
Corporate Space due to Lack of Enterprise-Ready Rugged Products
• Early Enterprise Adoption is Coming with Pain –
iPad’s experienced 20% Failure Rate Over 2 Years – Even Before Introduction into the Enterprise Space – SquareTrade Warranty
Lack of Manageability and Security Features Creates IT Headaches
The Opportunity is Clear: Bring Rugged
Quality to the Masses
Xplore is Best Positioned to Exploit
this Disruptive Opportunity
Xplore Market Objectives
Maintain Leadership Position in Ultra Rugged Space
Take Advantage of Converging Tablet Space with Android & Windows Offerings
Expand Reach With Lower Weight / Lower Cost Fully Rugged Products
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Strong Financial Performance
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FY11 FY12 FY13$0.00
$5,000,000.00
$10,000,000.00
$15,000,000.00
$20,000,000.00
$25,000,000.00
$30,000,000.00
$35,000,000.00
55% Growth11% Growth
Year over Year Revenue Comparison
Financial Highlights in FY2013
Reported first profitable year in Company’s History
Generated approximately $3 Million of cash from operations
Gross profit of approximately 34% an improvement of 13%
Completed Recapitalization wherebyRaised $10 Million in cashConverted all preferred stock to common stockUp-listed to Nasdaq exchange
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Xplore Strengths
Solid Existing Business LineMost Rugged Tablet in the MarketExploding Market with High Growth PotentialPioneer & Leader In Rugged Tablet ComputingReplicable, Scalable ODM Model with Industry Leading Strategic PartnershipsProven Ability to Sell & Support Fortune 100 companies - for example, marquis accounts such as AT&TProven Management team – over 140 years in High-Tech Leadership Experience
Development of New Products for Convergence of Consumer/Commercial Tablet with Rugged Mobile Market
Xplore is best positioned to exploit this opportunity
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Investor ConsiderationsWorld Leading Provider of Rugged Tablets
In a Market with Exploding Growth Potential
With Opportunity to Triple it’s Addressable Market With New Products By 2014
Cash Flow Positive
Debt Free
Positive Working Capital (Current Ratio 4.2:1)
$10.3 million in Cash
$86 million Tax Loss Carry Forward
Market Capitalization of $29 million on July 1, 2013
Significant Insider (Phoenix) Ownership at an Average Cost of $8/Share
Financial Data as of March 31, 2013