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Uni-Pixel: Rebuttal To Ivan Jimenez

|Includes:Uni-Pixel, Inc. (UNXL)

This is in response to Ivan Jimenez's Insta-Blog post here. I wrote this comment on Ivan's blog itself, but he deleted it. I attempted to write it again, but, having no guarantee he won't just delete it again, I am also writing it here. [EDIT: First Ivan deleted my comment. Since I then used this posting as a more 'permanent' solution, Ivan decided to delete his blog post altogether. This further proves his knowing knowledge of such inaccuracies and his attempts to bash UNXL for some personal reason. I am leaving this posting up since it contains many erroneous quotes from his original posting]

Ivan, in the past you have written reasonably researched articles on UNXL and ATML, but this Insta-Blog post is full of blatant errors. It is no wonder that SA refused to publish it as a "real" article.

First and foremost, you claim the following:

"What was expected was for UniPixel to make good on its promise "to produce sixty-thousand square feet of touch sensor per month" and what we got was initial shipment quantities of "50 moving to hundreds and thousands over the next several months."

You kindly provide a link to substantiate your claims, but the link simply refers to your own previous article. Within that article, you link to a PR from UNXL which states the following:

"With the printing and plating line qualified and production ready, we are on track to meet the capacity target of sixty thousand square feet per month by the end of April."

This PR specifically and directly states that UNXL's goal was a CAPACITY target of 60k units by the end of April, not a production target. You clearly knew this, yet decided to attempt to spin it in a negative light anyway.

Secondly, you clearly have no idea what the Kodak deal entails. No where has it been stated that they contributed $40+ million or participated in the recent public offering. And Uni-Pixel's cash only went up by $2.7M because the cash number was as of 3/31, and both the Kodak deal and the public offering happened after this date, in April. The Kodak deal will help to vertically integrate the UniBoss process (Kodak creates their own PET film) while also allowing Uni-Pixel to greatly benefit from the wealth of expertise that Kodak has in fine-line printing.

Those were the two major points, but you also have some other minor mistakes.

You claim that Uni-Pixel will not be giving guidance until 2014, and paint this negatively. This is actually very common for pre-production companies and/or small companies. Furthermore, even many large companies don't give guidance.

You continue to go on and claim that Uni-Pixel's yield of 70% isn't very good, when that is actually very average for this type of printing. Furthermore, I would fully expect this number to improve as they transition to Kodak's facility and implement more six-sigma best practices with Kodak and their new VP of Manufacturing Robert Rusenko (have you looked into him yet? very impressive).

Pretty much the only thing accurate in your entire blog post is that UNXL does still have more testing to undergo. This has been expected and, yes, it is a potential risk. Nobody is saying that UNXL is without risks. There are many risks beyond just manufacturing/testing. However, the upside is so large that investors are willing to take that risk because the risk/reward is in their favor.

Based on your previous work Ivan, I know that you know this blog post is full of tremendous errors, which makes me wonder why you even posted it? You claim to have no position, yet you purposefully mislead investors and slander a company? While I used to have respect for some of your work, this posting leads me to believe that you have ulterior motives. Everybody makes mistakes in their research at times, and that is understandable. However you are purposefully lying and misleading investors with full knowledge. I will end this with two quotes from you:

1. From a comment you wrote on your own article linked above, dated April 15th: "Because this will be their first mass-manufacturing line. This is the pilot line where they will learn what works and what doesn't. There can be many technical things that can go wrong that not even UniPixel can predict. UniPixel is an early production stage where anything can happen.

2. From this blog: "The reality is that this is the first mass-production line ever for UniBoss and it is from this pilot line that UniPixel will learn what works and what doesn't....What is most troublesome here is that UniPixel has been hiding these facts from the public"

Disclosure: I am long UNXL.

Stocks: UNXL