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Cowen Group 40th Annual Technology, Media & Telecom Conference Dr. John C.C. Fan, President and CEO Richard Sneider, Treasurer and CFO May 30, 2012 Forward-looking Statements This presentation includes forward-looking statements within the meaning of the United States Private Securities Litigation Reform Act of 1995. These statements relate to our expected future financial and operating performance, growth in the markets in which our products are sold, our market share for our products, and our significant customers. We may use words such as “expects,” “anticipates,” “intends,” “plans,” “believes,” “could,” “seeks,” “estimates,” and variations of such words and similar expressions in identifying forward-looking statements. In addition, any statements which refer to expectations, projections, our stock value multiple, the value of Golden-i products, or other characterizations of future events or circumstances are forward-looking statements. These statements are not guarantees of future performance and involve certain risks, uncertainties and assumptions which are difficult to predict. Actual outcomes and results may differ materially from what is expressed or forecasted in such forward-looking statements, whether as a result of new information, future events or otherwise. We refer you to the documents the Company files from time to time with Securities and Exchange Commission, and specifically the “Risk Factors” section of the Company’s Form 10-K for the period ended December 31,2011 and Form 10-Q for the three month period ended March 31, 2012. We do not undertake to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. 2 see, hear and communicate Kopin Highlights • Innovations – Original nanotechnology from MIT Lincoln Laboratory – Strong IPs – 200+ patents and increasing rapidly • Global leader in key product categories – Advanced Nanotransistor products for Smartphones – Revolutionary Systems for Defense, Industrial and Consumer Applications • Drivers of Growth – III-V : A Compounding Story -More Smart Phone Sales, More Chips per Phone, More Advanced Chips with Higher ASPs – Imaging Systems : New Products Aimed at Billion $ Markets – Evolving Licensing Model • Strong financial results – Profitable, Operating Cash Flow Positive and Strong Financial Position (Cash and S/T investments > $100M, no debt) – Generated $19.3 million in cash from operating activities in 2011 – Over $30million spent on Stock repurchase since 2006 3 see, hear and communicate III-V Product Group 4 The World is Changing What won’t be Wireless? 5 see, hear and communicate Wireless is Fueled by GaAs “GaAs has firmly established itself as the technology of choice for RF front-end in applications such as cellular handsets and WLAN.” Glen Riley, VP Commercial Foundry, TriQuint Semiconductor Why? Longer Battery Life Smaller Footprint High Data Rate Superior Signal Strength 6 see, hear and communicate Where We Fit Substrates 7 GaAs Transistor Wafers see, hear and communicate Power Amplifiers / Modules Mobile Devices Smartphones Are Fueling Growth in Wireless • Smartphones will be >50% of the market next year • GaAs content in a Smartphone significantly higher than legacy feature phones Smartphone Growth 1,800 Smartphone Units Shipped (Millions) 1,600 Non-Smartphone 1,400 1,200 1,000 800 600 400 200 0 2011 2012 2013 2014 2015 2016 Cited from: Customer Data, Prismark, and Internal Estimates see, hear and communicate Why Kopin is Succeeding… Quality • Highest Yields • Proprietary In-Situ Monitoring • Quick-Lot Technology Manufacturing • Experience • Innovation • Performance • Capacity • Scalability • Multiple Fabs see, hear and communicate BiHEMT Complexity • More than 3x - 4x the number of layers in BiHEMT relative to HBT n+ InGaAs Contact n+ GaAs Cap n InGaP or AlGaAs Emitter p+ GaAs Base • Precise pHEMT layer control needed for excellent interfaces n GaAs Collector • Additional calibrations required n+ GaAs Sub-collector • Additional and tighter QL tests required n+ GaAs pHEMT contact n GaAs cap n InGaP or AlAs Etch Stop HBT n GaAs Collector n AlGaAs Schottky n+ delta doping AlGaAs Spacer InGaAs Channel AlGaAs Spacer n+ delta doping n+ GaAs Sub-collector AlGaAs and GaAs Buffer Layers GaAs Substrate GaAs Substrate n+ InGaAs Contact n+ GaAs Cap n InGaP or AlGaAs Emitter p+ GaAs Base see, hear and communicate BiHEMT n InGaP or AlAs Etch Stop Industry Leading Quality Control: Smart Epi™ Process control Every wafer Every run Real time Smart Epi is in every Kopin System see, hear and communicate Manufacturing – Capacity and Capability 2 Yr $16 million New Capacity Expansion Complete Largest, most advanced Epi Wafer Manufacturing Toolset in Industry Current investment sufficient capacity into 2012 Efficiencies continue to improve 6” Capacity in Thousands • • • • Year 12 see, hear and communicate Technology Increasing Front End Complexity WCDMA Band 1 EDGE Quad Band WCDMA Band 2 WiFi WCDMA Band 3 LTE / Wimax WCDMA Band 4 Multimode Transceiver Baseband 13 see, hear and communicate Technology Requirements Advanced HBTs= BiFET, BiHEMT Kopin is Top Merchant Market Share Leader Supply Agreements with Industry Power Amplifier Leaders • Skyworks Solutions (customer >16 years) • RFMD (>10 years) • TriQuint (>10 years) • AWSC (>10 years) • WIN • GCS Client Diversification = Revenue Stability and Higher Capacity Utilization Kopin Market Share, 45% Others Kopin Wins Fourth Consecutive Supplier Award from Skyworks Solutions – announced February 3, 2011 Note: Percentages based upon III-V revenues. see, hear and communicate GaN is the next GaAs Enables Tremendous Energy ($) Savings Switching Figure-of-Merit GaN vs. state-of-art Silicon Less Efficient 3,000 2,500 2,000 1,500 1,000 More Efficient 500 0 GaN GaN Si MOSFET Vendor A Si MOSFET Vendor B Si MOSFET Vendor C Applying GaN technology to data server market alone, improvements to conversion efficiency can reduce energy consumption >$5B / yr Data from EPC Corp. see, hear and communicate Display Products 16 Step-by-Step Product Evolution 5 2 1 17 Industrial, Prosumer, Consumer Information System 4 3 The Golden-i Family Golden-i – Monocular, Industrial Optical Subsystem Gunsight, Eyewear Optical Module Electronic Viewfinder Component Microdisplay see, hear and communicate Next Generation Device Requirements • • • • • • 18 High Definition Microdisplay Optical module to Magnify the Image Electronics – Processors, Driver Electronics, Radio, Motion Sensor, etc. Software – Operating System, Voice and Speech Recognition, etc. Application Software Proper Ergonomics see, hear and communicate Step 4 Game Changer • World’s First Hands-Free Computer Headset – Intelligent Terminal for Cloud Computing – 15” SVGA color image – Processor and Operating System Software – Noise Cancellation – Voice and Motion Control – Wireless-WiFi and Bluetooth • Great IP Protection – Over 30 Patents, issued and pending, for Hardware and Software 19 see, hear and communicate Step 4 Multiple Vertical Apps = Billion $ TAM Apps include: •Distribution •Manufacturing •Medical •Military •Repair •Security Full Environmental Temperature Range Industrial Certified~ Mil Std. 810 All Weather Operation 20 see, hear and communicate Step 4 Golden-i Business Model Kopin and Motorola Solutions Joint Development Program • Kopin Provides the Imaging System and Operating Software • Motorola Manufactures and Distributes Ruggedized Version • Kopin and Motorola Jointly Engage Software App Developers • Product Launch Scheduled for 2012 Kopin Sells the Imaging System and Receives License Revenue per unit for Operating Software and Know-how 21 see, hear and communicate Step 5 The Golden-i Family Gen 4 Rugged Gen 3.8 Prosumer Common Software Platform 22 see, hear and communicate Gen 3.3 Consumer 75% Common 25% New: Apple and Android Future Golden-i Entertainment Systems • Hands-Free Headset – Binocular – 3D HD – Wireless – Software • For Entertainment and Consumer Markets 23 see, hear and communicate Summary III-V Transistor Wafer Group Imaging Systems Group • Market leader • Market leader • Client diversity – revenue stability • Vertical application diversity – revenue stability • Strong smartphone growth expected • Golden-i market projections in billions of dollars Financial Strength Strong Balance Sheet Strong Intellectual Property Portfolio Strong Technology and Manufacturing Innovative New Products 24 see, hear and communicate