BRN Discussion Ongoing

[SERA2g]

Hi Plebby, extract from earlier research on this topic.
Fact both Sean and ChaIrman Tony V took circa 81% plus of their real pay in equity in 2023. See the Annual report. Likely similar result in 2024.
They do via conversion of RSU's which avoid insider trading regulations. Smart way to incentivize employees and build insider holdings.
Fact both Sean and Tony V are net accumulating and hold enough to put them in the top 50 holders. See recent Director's notices.
Fact. Sean has 6 million RSU's which he can elect to take over time instead of cash pay. If he keeps taking equity instead of cash pay he will end up in the top 20.
Fact 15.5% - to 16.6% of SOI are held by insiders. See Yahoo Finance and Simply WS.
Assumption: Sean, Tony and insiders know a lot more about what is to come with BRN than holders and posters.
On top of the above Insiders hold enough to block any unwelcome takeover offers.
Sean hinted on further positive news to come on a recent podcast. Not sure how big the deals will be. Hopefully Tata sign up some time this year as that could be a profitable overnight deal.
Recent Frontgrade and USAF deals give confidence as does our new partners with our Edge Box.
Connection with RTX a huge defense supplier. Bascom Hunter.........................................All adding up.

Hi Manny

I think you are taking a very rose-coloured glasses approach to the way that RSU's work.

Don't quote me on this as I have not looked at the remuneration reports from the latest set of accounts for some time, but Sean's salary is circa gross $400K. On top of this, Sean is eligible to receive performance shares which are issued on meeting KPI's.

We are not provided information surrounding the KPI's that need to be met. Some KPI's might be walk ups such as 'attend all 12 monthly meetings', others will be 'expand ecosystem by x% or 'generate net sales of $500m'.

Some KPI's will be met, some will not. The restricted shares are issued upfront and then ordinary shares are awarded upon KPI's being met, or cancelled at the conclusion of the KPI period set by the board.

You've previously posted the narrative that Sean is accumulating because he is selling 'some' of his shares to cover tax obligations, but not all of them.

Sean's shares are issued to him for FREE. $0. Nothing. He then has to pay tax on the discount (full value of the shares at date of issue). I therefore understand why directors then sell some of those shares to fund their tax obligations.

It is a big reach to then argue Sean is accumulating because his shareholdings have increased.

Sean has no skin in the game with respect to the performance share's he's issued. He isn't buying $50K shares on market like we would have to. He has received them for FREE. He then sells $10K worth of shares to cover an upcoming $10K tax liability in relation to those shares. Ergo, Sean has FREE-CARRIED $40K worth of shares. With tax having been paid by share sales, he's literally out of pocket $0 for the remaining shares.

If he received $50K worth of shares for FREE and then paid the corresponding tax liability from his own cash, it would be fair to argue that he has $10K skin in the game. This simply is not the case. Sean and the other directors always sell shares to cover the tax liability.

As far as I'm aware, Pia is the only director to have purchased shares on market in the last few years.

All of the above aside, we want to attract top talent and it would be fair to say that US based CEO's of tech company's would receive significantly more than $400K for their role, so I do understand the need to include performance shares in the overall salary package. This works well for shareholders as the directors have a long term incentive to increase the value of the company and therefore shareholders capital.

The one painful point for people like Sean is that shareholders tend to jump on them when they sell shares to cover tax, however, there's no announcement when a director chooses not to sell shares and personally wears the tax, leaving the decision a thankless one.

 

[Fullmoonfever]

Does anyone know if it was retail FOMO or other?

Hi Pom,

This is from the other site courtesy of a poster by the name of DimDim.


BRN Broker Data Analysis

First, let me give you a bit of perspective over the year to see where we are now. The yellow line shows the trend of share accumulation by 4 retail brokers combined. As you can see, about 100M shares were accumulated by retail brokers over the year.

Top sellers and their accumulation/distribution trends:
- FinClear Execution
- Bridges
- Barrenjoey

Now, let's have a closer look at broker data since October.
Top buyers:

Top sellers:

Retail broker accumulation on the chart:

What's interesting here is that selling by retail brokers started from Dec 23. This means that pro brokers pushed the price up. Very nice pattern, especially combined with the break of the fallen trendline.

Who pushed the price up:
- Goldman Sachs
- Macquarie Securities
- Morrison

Interesting development. Looks positive. Going to keep an eye on it.

 

[Diogenese]

Hi Manny

I think you are taking a very rose-coloured glasses approach to the way that RSU's work.

Don't quote me on this as I have not looked at the remuneration reports from the latest set of accounts for some time, but Sean's salary is circa gross $400K. On top of this, Sean is eligible to receive performance shares which are issued on meeting KPI's.

We are not provided information surrounding the KPI's that need to be met. Some KPI's might be walk ups such as 'attend all 12 monthly meetings', others will be 'expand ecosystem by x% or 'generate net sales of $500m'.

Some KPI's will be met, some will not. The restricted shares are issued upfront and then ordinary shares are awarded upon KPI's being met, or cancelled at the conclusion of the KPI period set by the board.

You've previously posted the narrative that Sean is accumulating because he is selling 'some' of his shares to cover tax obligations, but not all of them.

Sean's shares are issued to him for FREE. $0. Nothing. He then has to pay tax on the discount (full value of the shares at date of issue). I therefore understand why directors then sell some of those shares to fund their tax obligations.

It is a big reach to then argue Sean is accumulating because his shareholdings have increased.

Sean has no skin in the game with respect to the performance share's he's issued. He isn't buying $50K shares on market like we would have to. He has received them for FREE. He then sells $10K worth of shares to cover an upcoming $10K tax liability in relation to those shares. Ergo, Sean has FREE-CARRIED $40K worth of shares. With tax having been paid by share sales, he's literally out of pocket $0 for the remaining shares.

If he received $50K worth of shares for FREE and then paid the corresponding tax liability from his own cash, it would be fair to argue that he has $10K skin in the game. This simply is not the case. Sean and the other directors always sell shares to cover the tax liability.

As far as I'm aware, Pia is the only director to have purchased shares on market in the last few years.

All of the above aside, we want to attract top talent and it would be fair to say that US based CEO's of tech company's would receive significantly more than $400K for their role, so I do understand the need to include performance shares in the overall salary package. This works well for shareholders as the directors have a long term incentive to increase the value of the company and therefore shareholders capital.

The one painful point for people like Sean is that shareholders tend to jump on them when they sell shares to cover tax, however, there's no announcement when a director chooses not to sell shares and personally wears the tax, leaving the decision a thankless one.

I don't agree that shares that are issued as part of a remuneration package are isued for free. Just like the cash salary, they are issued for services provided by the recipient. In fact they may be tied to specific performance targets.

 

[toasty]

I'm now entering my 8th year as a shareholder in BRN and I must say I'm REALLY tired of nothing but dot joining and guessing about the current state of play of the company. Its all become VERY tiresome and I'm of a mind to sell the lot (yes, its a lot) if/when the SP manages to crawl above $1........ not good enough from management.....at all!!!

 

[IloveLamp]

Robert Little on LinkedIn: Apple joins the robotics race | Armor

Apple is Exploring Robotics Apple and Carnegie Mellon University are developing ARMOR, a wearable perception system for humanoid robots. Based on a recent…

www.linkedin.com

 

[FJ-215]

I don't agree that shares that are issued as part of a remuneration package are isued for free. Just like the cash salary, they are issued for services provided by the recipient. In fact they may be tied to specific performance targets.

I preferred stock options over RSU's. Have a look at our past Chair, Manny Hernandez. He was granted 8M options that vested over a period of time with a strike price of 16.5 cents. Basically a pair of golden handcuffs to keep him with the company.

What did Manny do? Let them lapse and then argued that he should get the 8 million shares as RSU's and turned the handcuffs in to a golden parachute. Apparently this was in the best interests of us shareholders.....

 

[manny100]

Hi Manny

I think you are taking a very rose-coloured glasses approach to the way that RSU's work.

Don't quote me on this as I have not looked at the remuneration reports from the latest set of accounts for some time, but Sean's salary is circa gross $400K. On top of this, Sean is eligible to receive performance shares which are issued on meeting KPI's.

We are not provided information surrounding the KPI's that need to be met. Some KPI's might be walk ups such as 'attend all 12 monthly meetings', others will be 'expand ecosystem by x% or 'generate net sales of $500m'.

Some KPI's will be met, some will not. The restricted shares are issued upfront and then ordinary shares are awarded upon KPI's being met, or cancelled at the conclusion of the KPI period set by the board.

You've previously posted the narrative that Sean is accumulating because he is selling 'some' of his shares to cover tax obligations, but not all of them.

Sean's shares are issued to him for FREE. $0. Nothing. He then has to pay tax on the discount (full value of the shares at date of issue). I therefore understand why directors then sell some of those shares to fund their tax obligations.

It is a big reach to then argue Sean is accumulating because his shareholdings have increased.

Sean has no skin in the game with respect to the performance share's he's issued. He isn't buying $50K shares on market like we would have to. He has received them for FREE. He then sells $10K worth of shares to cover an upcoming $10K tax liability in relation to those shares. Ergo, Sean has FREE-CARRIED $40K worth of shares. With tax having been paid by share sales, he's literally out of pocket $0 for the remaining shares.

If he received $50K worth of shares for FREE and then paid the corresponding tax liability from his own cash, it would be fair to argue that he has $10K skin in the game. This simply is not the case. Sean and the other directors always sell shares to cover the tax liability.

As far as I'm aware, Pia is the only director to have purchased shares on market in the last few years.

All of the above aside, we want to attract top talent and it would be fair to say that US based CEO's of tech company's would receive significantly more than $400K for their role, so I do understand the need to include performance shares in the overall salary package. This works well for shareholders as the directors have a long term incentive to increase the value of the company and therefore shareholders capital.

The one painful point for people like Sean is that shareholders tend to jump on them when they sell shares to cover tax, however, there's no announcement when a director chooses not to sell shares and personally wears the tax, leaving the decision a thankless one.

Hi SERA2g, no reach at all or rose coloured glasses.. Share based payments are the same as salary sacrifice and are added to income as such in the audited reports and PAYG certificates.
That is how they are treated by accepted Accounting and Taxation principles - part of their pay structure. Why would you think otherwise?
If you salary sacrificed for a car or shares its included as income and taxable - as that is what you earn. Tax on employee issued shares is a little less harsh here though than in the US.
Why would you buy on market if you get shares via the employer and also avoid any insider buying potential issues? Its common practice in the US. Although get the timing right and you may get them cheaper on market?
See link to 2023 Annual Report.

https://cdn-api.markitdigital.com/apiman-gateway/ASX/asx-research/1.0/file/2924-02777372-2A1507488

See remuneration report (Audited) note 7. page 21. Realized Remuneration.
T Viana Salary $111255 Share based payment $698,146 Total $809401 NIL Performance based payment.
S Hehir Salary $456,781 Annual Leave $34,614 Superannuation $9,900 Share based payments $2,079,606 Total $2,580,801
Sean Hehir PERFORMANCE BASED PAY WAS 5%.
See also Directors Share Notices.

 

[DingoBorat]

Hi Pom,

This is from the other site courtesy of a poster by the name of DimDim.


BRN Broker Data Analysis

First, let me give you a bit of perspective over the year to see where we are now. The yellow line shows the trend of share accumulation by 4 retail brokers combined. As you can see, about 100M shares were accumulated by retail brokers over the year.


View attachment 75879


Top sellers and their accumulation/distribution trends:
- FinClear Execution
- Bridges
- Barrenjoey


View attachment 75880

Now, let's have a closer look at broker data since October.
Top buyers:


View attachment 75881

Top sellers:

View attachment 75882


Retail broker accumulation on the chart:

View attachment 75883


What's interesting here is that selling by retail brokers started from Dec 23. This means that pro brokers pushed the price up. Very nice pattern, especially combined with the break of the fallen trendline.

Who pushed the price up:
- Goldman Sachs
- Macquarie Securities
- Morrison

View attachment 75884


Interesting development. Looks positive. Going to keep an eye on it.

You should really give up your day job, if you have one FMF..

Always Great analysis of these kind of things, when you put your mind to it

 

[Pom down under]

Hi Pom,

This is from the other site courtesy of a poster by the name of DimDim.


BRN Broker Data Analysis

First, let me give you a bit of perspective over the year to see where we are now. The yellow line shows the trend of share accumulation by 4 retail brokers combined. As you can see, about 100M shares were accumulated by retail brokers over the year.


View attachment 75879


Top sellers and their accumulation/distribution trends:
- FinClear Execution
- Bridges
- Barrenjoey


View attachment 75880

Now, let's have a closer look at broker data since October.
Top buyers:


View attachment 75881

Top sellers:

View attachment 75882


Retail broker accumulation on the chart:

View attachment 75883


What's interesting here is that selling by retail brokers started from Dec 23. This means that pro brokers pushed the price up. Very nice pattern, especially combined with the break of the fallen trendline.

Who pushed the price up:
- Goldman Sachs
- Macquarie Securities
- Morrison

View attachment 75884


Interesting development. Looks positive. Going to keep an eye on it.

 

[Fullmoonfever]

You should really give up your day job, if you have one FMF..

Always Great analysis of these kind of things, when you put your mind to it

Hey DB,

I'd like to take the credit but is DimDims analysis as posted at the other place with his/her broker data.

I thought I'd share it here for those that don't frequent the other place.

 

[Pom down under]

Dunno Pom.
There was a lot of speculation about expected announcements on all the channels so I recon some retail and perhaps even a bit of soph. FOMO was invoked.
We did wind up getting some good announcements but nothing that shot the share price into the stratosphere and now that CES has come and gone, some reallocation is to be expected I suppose.
I think we are now at the point where it will take a contract with some significant ongoing revenue to really get us moving.
Till then its back to the hurry up and wait.

I’m happy for the SP to move in a sidewards direction as my super is due soon , but yes your right we need revenue

 

[manny100]

Hi SERAg2, hope my previous post did not seem harsh. Its just that many moons ago i worked for a short time in a team pulling Annual Report apart. So it all seems straight forward to me.
To be honest its refreshing to see a Chairman and CEO taking so much of their pay as equity. Usually they rip as much cash out as they can.

 

[DingoBorat]

Hi Manny

I think you are taking a very rose-coloured glasses approach to the way that RSU's work.

Don't quote me on this as I have not looked at the remuneration reports from the latest set of accounts for some time, but Sean's salary is circa gross $400K. On top of this, Sean is eligible to receive performance shares which are issued on meeting KPI's.

We are not provided information surrounding the KPI's that need to be met. Some KPI's might be walk ups such as 'attend all 12 monthly meetings', others will be 'expand ecosystem by x% or 'generate net sales of $500m'.

Some KPI's will be met, some will not. The restricted shares are issued upfront and then ordinary shares are awarded upon KPI's being met, or cancelled at the conclusion of the KPI period set by the board.

You've previously posted the narrative that Sean is accumulating because he is selling 'some' of his shares to cover tax obligations, but not all of them.

Sean's shares are issued to him for FREE. $0. Nothing. He then has to pay tax on the discount (full value of the shares at date of issue). I therefore understand why directors then sell some of those shares to fund their tax obligations.

It is a big reach to then argue Sean is accumulating because his shareholdings have increased.

Sean has no skin in the game with respect to the performance share's he's issued. He isn't buying $50K shares on market like we would have to. He has received them for FREE. He then sells $10K worth of shares to cover an upcoming $10K tax liability in relation to those shares. Ergo, Sean has FREE-CARRIED $40K worth of shares. With tax having been paid by share sales, he's literally out of pocket $0 for the remaining shares.

If he received $50K worth of shares for FREE and then paid the corresponding tax liability from his own cash, it would be fair to argue that he has $10K skin in the game. This simply is not the case. Sean and the other directors always sell shares to cover the tax liability.

As far as I'm aware, Pia is the only director to have purchased shares on market in the last few years.

All of the above aside, we want to attract top talent and it would be fair to say that US based CEO's of tech company's would receive significantly more than $400K for their role, so I do understand the need to include performance shares in the overall salary package. This works well for shareholders as the directors have a long term incentive to increase the value of the company and therefore shareholders capital.

The one painful point for people like Sean is that shareholders tend to jump on them when they sell shares to cover tax, however, there's no announcement when a director chooses not to sell shares and personally wears the tax, leaving the decision a thankless one.

I understand you're just trying to keep it real here Sera and Manny "can" sometimes be a little overzealous, in his praise and promotion of BrainChip (I know "I'm" never guilty of that ..).

But I thought he backed up his argument to Plebby, very well.

And you kind of contradicted yours badly here..

"All of the above aside, we want to attract top talent and it would be fair to say that US based CEO's of tech company's would receive significantly more than $400K for their role, so I do understand the need to include performance shares in the overall salary package. This works well for shareholders as the directors have a long term incentive to increase the value of the company and therefore shareholders capital.

To say they got their shares "for FREE" is basically the same as saying Peter Van der Made and Anil Manker, got "their" shares for free, because they didn't buy on market..

 

[HopalongPetrovski]

I’m happy for the SP to move in a sidewards direction as my super is due soon , but yes your right we need revenue

View attachment 75887

Yes.
All the other stuff is good and necessary and affirming, but what is required finally, is ongoing revenue to prove we really are, a commercially viable entity.

 

[DingoBorat]

Hey DB,

I'd like to take the credit but is DimDims analysis as posted at the other place with his/her broker data.

I thought I'd share it here for those that don't frequent the other place.

I take what I said Back!

How dare you try and take credit, for DimDim's hard work!!

You should thoroughly be ashamed of yourself!!

But hey, I did read that and then it was disregarded upon looking through the information provided..
Quotation marks and italics, would have made it clearer ..

 

[SERA2g]

I don't agree that shares that are issued as part of a remuneration package are isued for free. Just like the cash salary, they are issued for services provided by the recipient. In fact they may be tied to specific performance targets.

Hi Dio

Of course there is an 'effort' component I'm not accounting for here.

I'm purely talking about the financial cost incurred by the director to obtain the shares.

There isn't one, unless you count the opportunity cost of taking a role with brainchip as opposed to NVIDIA or any other company which might pay an equivalent executive position more than $400k to undertake.

Hence why I understand the need for a large portion of their package to be equity based.... The package needs to be competitive or we won't attract talent.

 

[DingoBorat]

Hi Dio

Of course there is an 'effort' component I'm not accounting for here.

I'm purely talking about the financial cost incurred by the director to obtain the shares.

There isn't one, unless you count the opportunity cost of taking a role with brainchip as opposed to NVIDIA or any other company which might pay an equivalent executive position more than $400k to undertake.

Hence why I understand the need for a large portion of their package to be equity based.... The package needs to be competitive or we won't attract talent.

I think you're still off track here a bit Sera..
You're basically saying, that you think there should be a "financial cost" for people, in order to receive part of their salary?..

 

[Fullmoonfever]

I take what I said Back!

How dare you try and take credit, for DimDim's hard work!!

View attachment 75888
You should thoroughly be ashamed of yourself!!

But hey, I did read that and then it was disregarded upon looking through the information provided..
Quotation marks and italics, would have made it clearer ..

Fine....you get one of these then. Geez, damn a guy just trying to share and help....know who your mates are....remind me not to bother next time

 

[SERA2g]

I understand you're just trying to keep it real here Sera and Manny "can" sometimes be a little overzealous, in his praise and promotion of BrainChip (I know "I'm" never guilty of that ..).

But I thought he backed up his argument to Plebby, very well.

And you kind of contradicted yours badly here..

"All of the above aside, we want to attract top talent and it would be fair to say that US based CEO's of tech company's would receive significantly more than $400K for their role, so I do understand the need to include performance shares in the overall salary package. This works well for shareholders as the directors have a long term incentive to increase the value of the company and therefore shareholders capital.

To say they got their shares "for FREE" is basically the same as saying Peter Van der Made and Anil Manker, got "their" shares for free, because they didn't buy on market..

Hi Dingo

Thanks for the feedback, always have enjoyed your posts.

I don't think ive contradicted myself here. I've just tried to show why this topic is difficult. There's two sides to it and there's a need for balance.

There's many reasons why the directors should receive performance shares, some of which I've outlined in my most recent post.

The issue is when the number of performance shares are excessive and the KPI's to obtain them are rudimentary such that they're effectively earned with no effort at all. We can't make judgement on that side of things because we don't know what the KPI's are, but the quantum in my mind is not excessive and seems to align to industry.

To clarify, I have no issue with brainchip's current approach to remuneration.

I just don't agree with Manny's ongoing narrative in convincing shareholders that Sean and co are accumulating in the same sense that us retail shareholders are simply because they haven't sold all of their performance shares lol.

I would love to see the entire board buy a wack of shares on market together to send a collective signal to the market that there's value in brainchip. They've had the chance to do this from $2.34 all the way down to 15c and haven't taken it. I don't think selling 'some' of their performance shares but not all fits the bill in this regard.

Do you?

 

[DingoBorat]

Hi Dingo

Thanks for the feedback, always have enjoyed your posts.

I don't think ive contradicted myself here. I've just tried to show why this topic is difficult. There's two sides to it and there's a need for balance.

There's many reasons why the directors should receive performance shares, some of which I've outlined in my most recent post.

The issue is when the number of performance shares are excessive and the KPI's to obtain them are rudimentary such that they're effectively earned with no effort at all. We can't make judgement on that side of things because we don't know what the KPI's are, but the quantum in my mind is not excessive and seems to align to industry.

To clarify, I have no issue with brainchip's current approach to remuneration.

I just don't agree with Manny's ongoing narrative in convincing shareholders that Sean and co are accumulating in the same sense that us retail shareholders are simply because they haven't sold all of their performance shares lol.

I would love to see the entire board buy a wack of shares on market together to send a collective signal to the market that there's value in brainchip. They've had the chance to do this from $2.34 all the way down to 15c and haven't taken it. I don't think selling 'some' of their performance shares but not all fits the bill in this regard.

Do you?

I agree and I personally (well not "in" person..) voted against the excessive share issues, that were proposed and defeated, a few years ago..

I'd also like to see BrainChip employees buying on market, especially at the lower prices, in support of the Company's retail shareholders "sentiment" in difficult times..

In all probability, there are probably many BrainChip employees, who are not part of the share incentives, who do.
Edit.. On the sly..cough..

But we will never hear about them.
Edit.. Unless they have an affinity for being prosecuted for "insider trading" as Diogenese points out later..

Tony Dawe, bought on market, before he was even a BrainChip employee and we would never know, if he hadn't freely shared the information.