ASX Today, page-564

Again a great bit of detective work there hottod.

The marriage of timing and technical characteristics described seem far too coincidental to me. I think Tempur Pedic are using Alexicool.

I agree that the wording implies that the scientists are in the direct employ of Tempur Pedic but there may be some 'promotional artistic license' being invoked here.

From the point of view of a large company like Tempur Pedic Alexium would simply be seen as a small, non-manufacturing, contract scientific servicing laboratory. Indeed, this is essentially what Alexium promotes itself as being.

Alexium have indicated that one of their strengths is their ability to tailor their product to meet the specific characteristics of individual clients. Alexium is able to design their product such that it meets the physical and chemical environment that is specific to that mattress. All manufacturers would not be employing identical component systems within their mattresses.

This point is illustrated with the Serta Simmons and Tempur Pedic patent applications. the first describes polymer fibre structures to which an encapsulated PCM component is chemically attached. The consequence is a permanently immobilised PCM structure that, as described by Barrelsitter, allows a more efficient heat transfer. It is this improvement in thermal transfer that forms the essential subject of the application, not the use of any particular PCM as such.

The claims within the application would allow use of the Alexium products for that purpose but, if used, Serta Simmons would regard the resulting composite structure as it's own PCM system, not the Alexicool component in isolation of the rest of that structure. Serta Simmons would correspondingly have a unique, proprietorial PCM cooling system and it would be both appropriate that they branded it as such and inappropriate that it be branded as an Alexium product.

Having employed Alexium to develop an Alexicool PCM system specific to their mattresses Tempur Sealy might also wish to promote it as a proprietary system developed by 'Tempur-Pedic's scientists', regardless of whether or not it included patent protection and regardless of whether or not those scientists were in their permanent employ but, rather, simply contracted to them temporarily for that purpose. They might also be expected to provide that system with their own brand name.

The Tempur Pedic patent application relates to various surface coating structures that allow improved thermal conduction and which can also incorporate PCM components within that surface. It is based on a provisional application filed December 2015 and it simply illustrates the type of PCM components that could be used by referring to the Microtek and Encapsys products then available. They are not confined to these two. I don't believe any Alexium products would have been available, or probably even known, at that time but there is no obvious reason why they would not be included if the application were filed now. The patent application, like the Serta Simmos application, relates to structures that improve thermal conductivity and does not claim any PCM IP.

If indeed this is the system Tempur Pedic are now using, like the Serta Simmons composite system, Tempur Pedic would be able to claim a proprietorial composite cooling system. One that included Alexicool as a component of that system, but where no reference to that component might be expected. They would simply see Alexicool as a material used in generating their composite cooling system. They could also be expected to brand that system accordingly.

We may, quite appropriately therefore see a range of PCM brand names within the bedding industry, all using Alexicool components within their individual PCM cooling systems, yet never see the term 'Alexicool' on public display.

It may indeed well be that Alexium are currently associated with either one or other of these two companies. Let's hope that they might soon be associated with both. It would appear from the two patent applications that each company has the opportunity to utilise Alexicool within it's products, have differentiated products base upon different cooling structures, and each being able to claim proprietorial IP related to the structure that incorporated the Alexicool.

poorinvestor