XTPL S.A.

Regulatory Filings • Aug 21, 2019

The Management Board of XTPL S.A. (the “Issuer” or the “Company”) herebyadvises that on 20 August 2019 it decided to start preparations forcommercialization the Company's technology in the area of flat-paneldisplays (“FPD”), so it can be used for open defect repair (“ODR”), inthe model of licensing the use of the Issuer's technology.

Based on preliminary talks with a group of potential clients interestedin implementation of the technology, the Management Board has positivelyassessed licensing as a way of commercializing the Issuer's technologyfor open defect repair. According to the Management Board, theadvantages of this model include inter alia:

• favorable relationship between the expected cost to the potentialeffects in the form of scalable revenues;

• shorter time needed to introduce the open defect repair technology inthe FPD sector;

• preferences of most clients who have declared their interest inpurchasing the solution offered by the Company.

The licensing model will allow the licensee’s potential to be forconducting effective tests of the solution in several cycles undernear-production and strictly production conditions. This model providesfor the licensee to ensure building a logistics chain, developingdistribution channels and creating as well as financing an area directlyresponsible for customer service (including for individualimplementations and after-sales support).

In the opinion of the Issuer's Management Board, licensing thetechnology increases the chances of its effective implementation in aparticular sector, achieving recurring revenues from that market and anopportunity to focus on developing a technology for use in newapplication fields.

The preparation for commercialization in the licencing model willprimarily include activities aimed at securing extra protection ofintellectual property, industrial property and the technologicalknow-how that will be covered by the licence. At the same time, theCompany will hold further talks and negotiations with entitiesinterested in acquiring the license.

In addition, the Management Board announces that it has decided to startan additional cycle of R&D work designed to develop the XTPL technologyin the ODR segment to confirm fulfillment of the initial requirementsfor new generation displays to be put in production in the coming years.The Management Board estimates that this work may take up to severalmonths and if successful it may contribute to a growth in revenues fromthe said licenses, as an increase in XTPL’s technological readiness willincrease the solution’s value for the potential partner and at the sametime extends by several years the expected economic life of the licencesfor the licensees.

In the opinion of the Issuer's Management Board, adoption the newcommercialization model for the Company's technology in the FPD sectorfor ODR application constitutes a significant change in relation to thecommercialization model being developed and communicated to the marketso far. This in its own right is a material piece of information aboutthe Issuer, which will probably be taken into account by stock investorsin their investment decisions, and in particular it will be a factoraffecting assessment of the Company’s revenue generation potential andtime frames. For this reason, in the opinion of the Management Board,this information meets the criteria of inside information within themeaning of Article 7(1) MAR.