Protecting  Electronics  from  theDeleterious  Effects  of  Liquids  andOther  Contaminants  at  theMolecular  LevelSean  Clancy,  Ph.D.   and  Yang  Yun,  Ph.D.HZO,  Inc.November  2014HZO.COM1

Overview§ § § § § § § § § MotivationAbout  HZOSample  ProductsCoating  EquipmentThroughput  and  Chamber  CapacityTemperature   in  Coating  ChamberComparison  in  Immersion  TestEnvironmental  Testing  with  100%  RH,  Salt  Fog,  and  Flowers  of  SulfurCoated  Battery  Capacity  after  Repeated   ImmersionsHZO.COM2

In a recent survey, 42% of respondentshad experienced electronic devicefailure due to moisture.– Commissioned  University  Study,  May  2012HZO.COM

80% of those failures weresubmersion related– Commissioned  University  Study,  May  2012Dropped in toiletSubmersion (sink or bathtub)Beach/PoolHZO.COM

Highly-Skilled Technical TeamAble to Design Solutions by ProductTechnical Expertise Thin Film Deposition & CharacterizationMaterials & Surface ScienceDevice PhysicsVacuum TechnologyPolymer ChemistryBarrier and Hydrophobicity ExpertiseCorrosion PreventionTechnical Team 100 Employees 70% Technical Resources 33% Bilingual employees15 Languages spoken167 Patent Filings with 5 GrantedWorldwide HZO.COMPatent Portfolio in Equipment, Materials,Processes, and More

HZO has beensuccessfully implementedin the mass production of manyconsumer electronics productsincluding:§ Smartphones§ Tablets & e-Readers§ WearablesHZO.COM

HZO  Protected  NavELite Compasswww.navelite.comHZO.COM7

HZO  Protected  Tolino  Vision vision2/HZO.COM8

Sample Products Currently in theMarket featuring HZONavELiteBack-Lit Wrist CompassICEdotBicycle Crash IndicatorTAG HeuerLuxury Smart PhoneNikeFuelBand SELaiPac TechS911 Bracelet LocatorLive FreeLife Beacon MedicalMobile AlertBearTekOutdoor GlovesDigital CaddieSamsung Galaxy Tab 2HZO.COM

OfficesHZO.COM Installations Deployments

HZO  Coating  MachinesHZO2000HZO.COMHZO500011

HZO10,000§ Capacity is 2x more than that of HZO5000HZO.COM12

Chamber CapacityCHAMBER SIZEProprietary process utilizes the largest chamber size in the industry High throughput Minimal flow HZO.COMHZO200013

Low  substrate e( C)70605040Deposition  completesDeposition  starts3020100§ Substrate  temperature  stays  below  45   CHZO.COM14

NoProtectionSpray(Silicone)Plasma(Fluorinated Carbon)HZOWater Protection Competitive Comparison5 Minutes Cycle Test*HZO.COM*2014 Cycle Test: 5 minutes total in dunk tank. At 2.5 minutes devices raised up near top (still submerged). Loweredback down for additional 2.5 minutes. Devices opened 1 week later with resulting corrosion.Source: HZO MPI Testing

HZO Environmental TestingDay 0100%  RH,  20  dDay 20Subjected to:100% RHAfter 20 days ofexposure, nocorrosion orincrease in leakagecurrent occurred,so the experimentwas stopped Corrosion Free 5 mm layer of deionized water is applied on top of anSIR pattern, representing a 100% relative humidity atroom temperature.Source: 2013 IPUHZO.COM16

HZO Environmental Testing (Cont.)100%  RH,  20  dTime(hours)6005244002001001651990HZO AcrylicSiliconePolyurethane100% Relative Humidity, 25 CEnvironmentalTestAcrylics start showing corrosion after 100 hoursExperiment concluded at over 500 hours: No evidence ofcorrosion observed for HZOSource: 2013 IPUHZO.COM17

Salt Fog Testing35   C,  5  wt.  %  NaCl,  168  hUncoated Board Positive control boardshowing massive corrosionHZO Coated Minor discoloration, but nocorrosionSource: 2014 Trace LabsHZO.COM18

Sulfur Corrosion Testing530 to 1500 ppb S8 molecule concentration, 60 to 71 oC, 45 rs-ofSulfur (FoS)environmentSource: 2014 BattelleHZO.COM19

Coated  Battery  PerformanceCapacity  after  Repeated   ImmersionsSource: 2014 HZOHZO.COM20

Summary§ HZO  coatings  are  deposited  in  a  high- throughput  chamber  with  a  faster  cycletime§ Substrate  temperatures   within  the  deposition  chamber   stay  below  45   C§ Environmental  testing  has  shown  excellent   moisture  and  corrosion  resistance§ Excellent  results  with  immersion  testing  on  a  wide  variety  of  devices§ Coated  batteries   have  shown  no  significant  effects  from  the  deposition  processand  subsequent  immersionHZO.COM21

*2014 Cycle Test: 5 minutes total in dunk tank. At 2.5 minutes devices raised up near top (still submerged). Lowered back down for additional 2.5 minutes. Devices opened 1 wee