I think the hastily recorded quarterly SH's report was preparing us for an underwhelming quarterly. I'm not expecting any lumps...Yeah the innovations appear to tick a lot of Gen 1 boxes. We just need MB to say to BRN 'OK you can now tell everyone that your product is in our cars'
Que ASX price sensitive announcement
Like I have previously stated ...... this issue of the 8 Million RSU to Manny is imo basically a non event .... given the situation, that the top say ~50 share holders hold the majority s/holding votes of the Co to pass this resolution. I'm fairly confident that Peter and Anil will support Manny's position fairly and in the best interests of the Co.
Bloody hope not. I am getting very frustrated now with the SP. And if you say it is s great time to accumulate, well I have been averaging down in the last 18 months and have no further intention to buy more
Why do you say it was hastily recorded. I see no evidence. Tony had already intimated that we were going to hear more from Sean a couple of weeks ago.
FACT: Renesas taped out a chip with Akida inside last December and are going into full production of this chip reportedly in the 4th quarter this year.
Megachips were involved in the backend design of Akida 2.0 - wonder why they would bother if nothing was happening in this area? Maybe our pit crew were so useless that the Megachips boys need to sort it! Or maybe, just maybe the two heads are better than one collaboration of partners for a successful project completion for customers was the aim of both pit crews.
I personally think, that there is a whole lot more to the story but can't be told for now by the Co for possible priviledged legal reasons ........ The Co imo/view seems wanting to avoid any potential legal claims/proceedings brought by Mr E H in the best interests of the Co .................. what would significantly worry me if I was the Co would be the issue of " what if Mr EH " was to legally claim that had he had received the 8million options that he potentially lost the opportunity to sell those shares at the top of the share market pricing being $2.34 /share ..( 8mill x $2.34 =I sent this email to Tony Dawe and received a quick reply, at 10:30pm! Which is a huge credit, to his work ethic.
Hi Tony, hope you are all doing well there
I've got a bit of a problem with the 8 million RSUs for MH.
The original options were 12.5 cents to exercise, why does he now get the RSUs which convert to full shares, for nothing?
The reasons given by the Company at the time, him not exercising, don't add up.
The Company has for a long time, stated that progress was more important than the share price (which I agree with) so why would it say, that him not exercising, benefitted shareholders, as the only reason I can think of, was the selling pressure of MH's tax selling (which we would still get now, but with a much pressured share price_________redacted_________________).
Sounds more like he simply didn't have a million on hand to convert at the time and him no longer being an employee, he would have had to convert straight away.
The Company's agreement, to keep his original expiry date, seems like just a favor to him, so why is the Company now open to legal repercussions, from not awarding him with the RSUs, at zero cost?
Were there some particular circumstances surrounding MH's departure, that make this a special case?
Sounds like the Company, agreeing to extend the expiry past him leaving, to the original date, has put the Company and its shareholders, at a disadvantage (no million dollars in funds).
How does this all work out, smells a bit off to me?
I think shareholders deserve a better explanation, than was given in the podcast.
His reply was
Thankyou for your email.
Please read the Explanatory Memorandum provided with the Notice of Meeting, released to the ASX last week.
You will find there a detailed description of the rationale for the resolution to award RSU’s to Mr Hernandez and the circumstances that gave rise to his options lapsing. I have nothing further to add to what’s provided in the Explanatory Memorandum.
Regards
Tony
The Explanatory Memorandum, which I had already read, is as follows..
RESOLUTION 8 - ISSUE OF 8,000,000 RESTRICTED STOCK UNITS TO
EMMANUEL HERNANDEZ
Background
As announced to ASX on 13 October 2022, the Company has entered into an agreement to
issue 8,000,000 Restricted Stock Units to Mr Emmanuel Hernandez, a previous Non-
Executive Director and Chair of the Company, following his resignation and the lapse of
options previously granted to him by the Company on 7 July 2017, subject to receipt of the
approval of Shareholders at this Annual General Meeting. The Restricted Stock Units are to
be issued in accordance with the terms of the Equity Incentive Plan the general terms of
which are contained at Appendix A, with the additional specific terms outlined below.
The Options granted to Mr Hernandez lapsed on 1 March 2022, following his resignation
from the Company.
Mr Hernandez expressed interest in reaching an agreement with the Company to avoid
exercising his Options at the same time and instead to continue holding the Options beyond
his resignation date up to expiration. The Company agreed to work with Mr Hernandez to
find an alternative to exercising the Options as this was considered to be in the best interest of
the Company and Shareholders. In so doing, the parties entered into discussions relating to
deferring the exercise of the Options. However, at the time of his resignation, it was
determined that the Company could not modify the terms of the Options without shareholder
approval or a waiver from ASX in relation to Listing Rule approval requirements for any such
modification. During the time required to investigate the proper method of modifying the
Options and negotiating the terms with Mr Hernandez, the Options ultimately lapsed. As this
occurred whilst Mr Hernandez was engaging with the Company on the process for exercise,
the Company considers it appropriate to award Mr Hernandez with the new RSUs.
Sections 200B and 200E of the Corporations Act prohibit the Company from giving a benefit
to a person who holds (or has held in the previous 3 years) a managerial or executive office
with the Company or its subsidiaries, if that benefit is given in connection with that person's
retirement from office and is in excess of that person's average annual base salary over the
relevant period, unless the benefit is approved by shareholders.
The issuance and subsequent vesting of the Restricted Stock Units will amount to the giving
of a termination benefit requiring shareholder approval in accordance with the Corporations
Act. Approval is therefore sought under sections 200B and 200E of the Corporations Act.
The Board does not consider that the issue of the Restricted Stock Units will materially
prejudice the Company or other Shareholders.
Brainchip also considers the issue of the New Rights to Mr Hernandez to be a necessary step
in the prevention of any potential claim by Mr Hernandez.
Specific terms of the Hernandez Restricted Stock Units
Grant Date: On or before the latest date specified by the ASX Listing Rules,
following receipt of all required shareholder approvals under the
ASX Listing Rules and Corporations Act.
Vesting of
RSUs
RSUs will vest and be automatically exercised on the last date of the
month in the month that the Grant Date occurs.
Value of
RSUs
The total value of the Restricted Stock Units cannot be ascertained at
the date of this Notice given the change of share price in market
listed shares from time to time.
The value will be equal to the market price of the Shares on the date
of vesting multiplied by the number of Restricted Stock Units
granted.
For example, if the Restricted Stock Units had been exercised on 22
March 2023 with a market price of $0.43, the Restricted Stock Units
would have had a value of $3,440,000 (being 8,000,000 multiplied by
$0.43).
Expiry Date: The date that is one business day after the last date of the month in
the month in which the Grant Date occurs.
Leavers: For the purposes of the Equity Incentive Plan, Mr Hernandez will be
regarded as an Eligible Participant and actively employed by the
Company until the date of exercise of the RSUs.
This Resolution seeks Shareholder approval for the issue of 8,000,000 Restricted Stock Units
under ASX Listing Rule 7.1 on such terms and conditions more particularly described below.
ASX Listing Rule 7.1 provides that a Company must not, subject to specified exceptions
under ASX Listing Rule 7.2, issue or agree to issue equity securities during any 12-month
period in excess of 15% of the number of Shares on issue at the commencement of that 12-
month period without Shareholder approval.
The effect of the resolution will be to allow the Company to issue the Restricted Stock Units,
the subject of this Resolution, no later than 3 months after the date of the meeting without
using the Company’s 15% annual placement capacity granted under ASX Listing rule 7.1. If
this Resolution is not approved by Shareholders, the Company will either not be able to issue
the Restricted Stock Units, the subject of this Resolution, in the event that Resolution 8 is not
passed by Shareholders, or will be required to issue the Restricted Stock Units, the subject of
this Resolution, by using a portion of the Company’s 15% placement capacity that will be
available if Resolution 8 is passed by Shareholders.
This Resolution is an ordinary resolution requiring it to be passed by a simple majority of
votes cast by the Shareholders entitled to vote on it.
In accordance with ASX Listing Rule 7.3 the following information is provided to
Shareholders:
(c) Number and Class of securities to be issued:
8,000,000 Restricted Stock Units
(d) Date on which securities will be issued:
The Restricted Stock Units will be issued within 3 business days of this Annual
General Meeting.
(e) Issue price of securities:
$nil.
(f) Allottees of the securities:
Mr Emmanuel Hernandez (or his nominee).
(g) Terms of securities:
On vesting of the Restricted Stock Units, the Shares, when issued, will rank
equally with all other Shares on issue at the time and have the same rights and
entitlements as the currently issued Shares.
Directors’ recommendation
The Directors unanimously recommend that Shareholders vote in favour of this Resolution.
The Chairman intends to exercise all available proxies in favour of this Resolution.
A voting exclusion statement for this Resolution is included in the Voting Exclusions.
Personally I'm not happy with that response and stance by the Company, on this matter.
There was no prior mention of this podcast. Tony could've been intimating that we would hear more via Q or AGM. I think they did it to slow-boil us...
brainchip.com
I agree there's more to the story but it's nobody's fault but EH's that he didn't get his house in order before retiring...
Good points jt. I think of all of your examples we will see first revenue from the Merc engagement. I'm pinning some hope on Merc using AKIDA in the current release. This could show through on the soon to be released 4C. If not then royalties from early sales by the end of the year.
Well if this is the first in a new series of podcasts with the next one in June, it’s going to be a very slow boil. Best get out of the pot now eh!
From the Notice of Annual General Meeting in regards to Mr Hernandez -I sent this email to Tony Dawe and received a quick reply, at 10:30pm! Which is a huge credit, to his work ethic.
Hi Tony, hope you are all doing well there
I've got a bit of a problem with the 8 million RSUs for MH.
The original options were 12.5 cents to exercise, why does he now get the RSUs which convert to full shares, for nothing?
The reasons given by the Company at the time, him not exercising, don't add up.
The Company has for a long time, stated that progress was more important than the share price (which I agree with) so why would it say, that him not exercising, benefitted shareholders, as the only reason I can think of, was the selling pressure of MH's tax selling (which we would still get now, but with a much pressured share price_________redacted_________________).
Sounds more like he simply didn't have a million on hand to convert at the time and him no longer being an employee, he would have had to convert straight away.
The Company's agreement, to keep his original expiry date, seems like just a favor to him, so why is the Company now open to legal repercussions, from not awarding him with the RSUs, at zero cost?
Were there some particular circumstances surrounding MH's departure, that make this a special case?
Sounds like the Company, agreeing to extend the expiry past him leaving, to the original date, has put the Company and its shareholders, at a disadvantage (no million dollars in funds).
How does this all work out, smells a bit off to me?
I think shareholders deserve a better explanation, than was given in the podcast.
His reply was
Thankyou for your email.
Please read the Explanatory Memorandum provided with the Notice of Meeting, released to the ASX last week.
You will find there a detailed description of the rationale for the resolution to award RSU’s to Mr Hernandez and the circumstances that gave rise to his options lapsing. I have nothing further to add to what’s provided in the Explanatory Memorandum.
Regards
Tony
The Explanatory Memorandum, which I had already read, is as follows..
RESOLUTION 8 - ISSUE OF 8,000,000 RESTRICTED STOCK UNITS TO
EMMANUEL HERNANDEZ
Background
As announced to ASX on 13 October 2022, the Company has entered into an agreement to
issue 8,000,000 Restricted Stock Units to Mr Emmanuel Hernandez, a previous Non-
Executive Director and Chair of the Company, following his resignation and the lapse of
options previously granted to him by the Company on 7 July 2017, subject to receipt of the
approval of Shareholders at this Annual General Meeting. The Restricted Stock Units are to
be issued in accordance with the terms of the Equity Incentive Plan the general terms of
which are contained at Appendix A, with the additional specific terms outlined below.
The Options granted to Mr Hernandez lapsed on 1 March 2022, following his resignation
from the Company.
Mr Hernandez expressed interest in reaching an agreement with the Company to avoid
exercising his Options at the same time and instead to continue holding the Options beyond
his resignation date up to expiration. The Company agreed to work with Mr Hernandez to
find an alternative to exercising the Options as this was considered to be in the best interest of
the Company and Shareholders. In so doing, the parties entered into discussions relating to
deferring the exercise of the Options. However, at the time of his resignation, it was
determined that the Company could not modify the terms of the Options without shareholder
approval or a waiver from ASX in relation to Listing Rule approval requirements for any such
modification. During the time required to investigate the proper method of modifying the
Options and negotiating the terms with Mr Hernandez, the Options ultimately lapsed. As this
occurred whilst Mr Hernandez was engaging with the Company on the process for exercise,
the Company considers it appropriate to award Mr Hernandez with the new RSUs.
Sections 200B and 200E of the Corporations Act prohibit the Company from giving a benefit
to a person who holds (or has held in the previous 3 years) a managerial or executive office
with the Company or its subsidiaries, if that benefit is given in connection with that person's
retirement from office and is in excess of that person's average annual base salary over the
relevant period, unless the benefit is approved by shareholders.
The issuance and subsequent vesting of the Restricted Stock Units will amount to the giving
of a termination benefit requiring shareholder approval in accordance with the Corporations
Act. Approval is therefore sought under sections 200B and 200E of the Corporations Act.
The Board does not consider that the issue of the Restricted Stock Units will materially
prejudice the Company or other Shareholders.
Brainchip also considers the issue of the New Rights to Mr Hernandez to be a necessary step
in the prevention of any potential claim by Mr Hernandez.
Specific terms of the Hernandez Restricted Stock Units
Grant Date: On or before the latest date specified by the ASX Listing Rules,
following receipt of all required shareholder approvals under the
ASX Listing Rules and Corporations Act.
Vesting of
RSUs
RSUs will vest and be automatically exercised on the last date of the
month in the month that the Grant Date occurs.
Value of
RSUs
The total value of the Restricted Stock Units cannot be ascertained at
the date of this Notice given the change of share price in market
listed shares from time to time.
The value will be equal to the market price of the Shares on the date
of vesting multiplied by the number of Restricted Stock Units
granted.
For example, if the Restricted Stock Units had been exercised on 22
March 2023 with a market price of $0.43, the Restricted Stock Units
would have had a value of $3,440,000 (being 8,000,000 multiplied by
$0.43).
Expiry Date: The date that is one business day after the last date of the month in
the month in which the Grant Date occurs.
Leavers: For the purposes of the Equity Incentive Plan, Mr Hernandez will be
regarded as an Eligible Participant and actively employed by the
Company until the date of exercise of the RSUs.
This Resolution seeks Shareholder approval for the issue of 8,000,000 Restricted Stock Units
under ASX Listing Rule 7.1 on such terms and conditions more particularly described below.
ASX Listing Rule 7.1 provides that a Company must not, subject to specified exceptions
under ASX Listing Rule 7.2, issue or agree to issue equity securities during any 12-month
period in excess of 15% of the number of Shares on issue at the commencement of that 12-
month period without Shareholder approval.
The effect of the resolution will be to allow the Company to issue the Restricted Stock Units,
the subject of this Resolution, no later than 3 months after the date of the meeting without
using the Company’s 15% annual placement capacity granted under ASX Listing rule 7.1. If
this Resolution is not approved by Shareholders, the Company will either not be able to issue
the Restricted Stock Units, the subject of this Resolution, in the event that Resolution 8 is not
passed by Shareholders, or will be required to issue the Restricted Stock Units, the subject of
this Resolution, by using a portion of the Company’s 15% placement capacity that will be
available if Resolution 8 is passed by Shareholders.
This Resolution is an ordinary resolution requiring it to be passed by a simple majority of
votes cast by the Shareholders entitled to vote on it.
In accordance with ASX Listing Rule 7.3 the following information is provided to
Shareholders:
(c) Number and Class of securities to be issued:
8,000,000 Restricted Stock Units
(d) Date on which securities will be issued:
The Restricted Stock Units will be issued within 3 business days of this Annual
General Meeting.
(e) Issue price of securities:
$nil.
(f) Allottees of the securities:
Mr Emmanuel Hernandez (or his nominee).
(g) Terms of securities:
On vesting of the Restricted Stock Units, the Shares, when issued, will rank
equally with all other Shares on issue at the time and have the same rights and
entitlements as the currently issued Shares.
Directors’ recommendation
The Directors unanimously recommend that Shareholders vote in favour of this Resolution.
The Chairman intends to exercise all available proxies in favour of this Resolution.
A voting exclusion statement for this Resolution is included in the Voting Exclusions.
Personally I'm not happy with that response and stance by the Company, on this matter.
You're entitled to your own opinion Diogenese.
