Old News:

This was published 10 months ago

Brainchip shares dive after shock CEO departure

By Colin Kruger

March 16, 2021 — 1.29pm

Brainchip, the billion dollar company promising to build computer chips that mimic the workings of the human brain, has lost its chief executive Louis DiNardo with immediate effect.

The company announced on Tuesday that Mr DiNardo had mutually agreed to terminate his contract “without cause, effective immediately” allowing him to leave the company and “pursue other interests”. It offered no explanation for the departure.

Brainchip co-founder Peter van der Made, the current chief technology officer, will take the CEO role while the search for a permanent replacement is conducted.

Brainchip has not provided an explanation for the abrupt departure of its CEO Louis DiNardo.Credit:Rick Stevens

The company said Mr DiNardo will remain employed by Brainchip in a part-time role to further assist with the CEO transition for 12 months, for which he will receive a payment of $US100,000 ($129,000) to be paid in equal monthly instalments over the period.

Mr DiNardo will also get a severance payment of $US300,000, to be paid in equal monthly instalments over 12 months.

According to Brainchip’s annual report, Mr DiNardo is entitled to 12 months pay if he is terminated without cause.

Brainchip chairman Emmanuel Hernandez said “on behalf of the board and the employees of Brainchip, we thank Lou for his years of service to Brainchip and for taking us from concept to silicon”.

“We wish him the best in his future endeavours.”

He leaves with 11.78 million shares and options over another 57.5 million shares. According to the annual report, 49.25 million of these options are vested and exercisable.

Brainchip’s market valuation soared above the billion-dollar market last year despite reporting a $6.86 million loss in August last year on revenue of just $13,397 for the half-year ending June 30 – an 80 per cent drop on revenue generated in the prior first half.

Shares dropped more than 10 per cent to a low of 47.5c when trading commenced on Tuesday. The company was valued at $900 million before this plunge.

Related Article

AI

Moment of truth coming for the billion-dollar BrainChip

Brainchip finally reported its first paying customer contract just before Christmas. It announced the signing of an intellectual property license agreement with the US subsidiary of Japan-based Renesas Electronics.

The agreement provides for various payment terms including the payment of ongoing royalties based on the volume of units sold, commencing at certain agreed volume threshold and the net sale price of the customer’s products, the company said.

For the year ending December 31, Brainchip reported a loss of $US26.8 million on revenue of $US120,829.

Brainchip shares have been buoyed recently by its inclusion in the S&P/ASX300 index, effective as of March 22.