4DS - Anything but Charting, page-19718

Ok I've had a crack at editing this and reducing the number of questions by around a third. I am not suggesting this must be what people submit and am more than open to counter-arguments and other ideas. Below is much closer to what I will personally be submitting.

I've left the existing question numbering in for the moment so as to reduce the confusion for those people going through it plus they can see which ones I've taken out. We can sort the numbering out at the end when we think we have agreement between us.

I've relocated some questions into different sections to try and maintain consistency. The formatting from Word does not transfer brilliantly to HC but we can all individually sort that out when we are submitting.

I've slightly added to and edited @RTheo's intro. His version is more aggressive than the one I had drafted but I like it so have largely left it in.

I have put the Comms section first because this has really annoyed us all from recent Anns and the Co needs to understand how poorly their SH regard the ones they issue.

Deleted questions:
1 - overly aggressive, they won't respond
5 - duplicate, merged with Q3
7 - duplicate, merged with Q3
8 - duplicate, merged with Q20
12 - surplus, I believe has been answered in recent announcements
13 - agree with@RTheo
14 - agree with @RTheo, duplicate
16 - duplicate, wrapped up in Q22
17 - duplicate, wrapped up in Q22
21 - insulting to DM, will not elicit any response and gets him even more offside. The same points are made in the introduction section
23 - I don't think they will respond to this
25 - I don't blame 4DS for improving their own testing capability and this would have happened naturally over time
26 - hearsay and total speculation
29 - redundant, we don't yet have a working Mb chip

Introduction & background

Does theBoard now realise and accept that the most recentcompany announcement, released on 4^th November, was poorly worded tosay the least, was excessively negative and has resulted in a major loss ofconfidence in both the Board and the Company more broadly by many existing shareholdersand the wider market, leading to the exit of many long-term shareholders and aresulting calamitous circa 55% fall in the share price?

Why did no-one realise this was inevitable prior to releasing the announcementas it was worded and amend it to make it less obviously damaging?

Therecent loss of confidence is, inmany shareholders view, a direct consequence of:

· poorly communicated strategy

· unannounced adoption of crystalline PCMO andassociated risk/benefit assessment

· inconsistent and poorlyworded market announcements

· “resolvable going forward with no delays to currenttimelines” became “expected out-of-fab date is July 2022”

· unnecessary statement: “there isno established market for Storage Class Memory”

· ongoing timeline blowouts

· commercial transaction anticipated during 2021 now appearsdeferred indefinitely

· directors selling shares (and no on-marketpurchases)

· insufficient technical information for shareholdersto ascertain the possible value of the Company’s technology

· retention (ten years) last reported in 2013,endurance unknown and speed ‘near DRAM’

· cell geometry scale ill-defined

· metrics needed for SCM not stated

· undisclosed JDA with HGST

Themultiple questions collated below have been sourced from manyshareholders and are aimed at trying to understand howmuch confidence shareholders should have in the Company and its ability to sell/commercialiseits technology.

Re-establishingshareholder confidence will require greatertransparency going forwards, significantly improvedcommunications and acknowledged accountability. Manyshareholders believe you have a special opportunity inthis AGM to demonstrate this tous in abundance by your responses to thesequestions.

Communicationsand Investor Relations

22. ASX continual disclosurerequirements (3.1 to 3.1b, guidance note 8 - points 4.20 to 4.22) require alisted entity to disclose information that may have a material effect on thevalue of its securities. Case law demonstrates that this requirement mustprevail over any NDA agreements. It is the view ofmany shareholders that 4DS technology performance metrics and strategic pivots should not havebeen almost entirely withheld from them / the market because of NDA agreements.

There is a widely held view amongst the shareholder base that we are ‘keptin the dark’. The huge contrast with the articulate communications to themarket issued by both BrainChip and Weebit Nano (and others) is impossible tomiss.

Can the company now commit to timelyannouncements of any achievements, events or actions that affect the value of4DS technology, alter the Company's research strategy, affect progress towardor achievement of milestones or change the realistic timeline to a commercialtransaction? If not, why not?

15.Unlike other ASX listed technology stocks, 4DS inrecent years has not made any effort to promote the benefits of its technologythrough industry media. Why has 4DS adopted this approach –in contrast to earlier years - and how does this benefitshareholders?

20. Does 4DS care about their share price? Doesthe Board consider a higher share price to be a better platform for negotiatinga commercial transaction or do they view this to be irrelevant?

Progress Towards a Commercial Transaction

2. Inwhat ways have the results from the Second Platform Lot and Third Non-Platform Lot made 4DS commercial-ready?

3. Youstated in the 4/11 announcement"as there is no establishedmarket for Storage Class Memory", which the market interpreted – rightly or wrongly - as indicating thatthere is no market for 4DS technology. What is your view on the status of theSCM market and how does this relate to 4DS and for example Intel activelycommercially marketing Optane as SCM for Data Centres? Does 4DS consider2024-2025 a realistic estimate for wider industryadoption of storage class memory?

4. Atlast year's AGM a Director stated that 4DS technology is already saleable andthat 4DS had received considerable unsolicited interest. Do you still support this statement? If not,why not?

6. 4DSMemory could generaterevenues by licensing to smaller applications - as is the approach of otheremerging memory players like Weebit Nano – does thecompany see this as a reasonablerecalibration of business strategy whilst we wait for a Tier 1 business casefor SCM that makes a 4DS acquisition attractive?


Progress Toward Technical Goals

9. Whatwere the most significant outcomes of the Western Digital initiated meetingwith 4DS in September of thisyear?

10. Pleasedescribe the changes and process optimisations that are required to achieve thedesired technicaloutcomes in Platform Lot 3 and then explain why you areconfident that you will achieve theseoutcomes?

Extra (@RTheo): Adoption of fullycrystalline PCMO appears to be a major change in strategic direction, implyinga shift from ReRam towards PRam technology. What is the business case for thischange of direction and why was it not communicated to shareholders?

11. Whatis the ‘Plan B strategy’ if process optimization fails to resolve theproblematic issues arising from use of the crystalline PCMO material?

18. 4DS stated that the Second Platform Lot demonstrated scalability of its memory cell to the smallest geometries on imec’s memory platform. Has 4DS achieved sub 28nm, sub 14nm or sub 10nm cell geometry? This information is critical for shareholders ability to understand the potentialvalue of the technology being developed. If4DS will not release this information to shareholders then please explain to uswhy it is not in our best interests.

19. 4DS stated that it has boosted read speed by one order of magnitude.Please describe how this relates to specifications needed to meet SCMrequirements and explain how this improvement affects the value of 4DStechnology.

Extra(@Hash): In a 2013 presentation 4DS stated thatits memory device had achieved retention of 10 years at 85 degrees C. Morerecently various ASX announcements stated "best retention ever recorded bythe company". Does "best retention ever recorded" mean betterretention than reported in 2013?

Extra (@accumulator): Does the company view the Yield being achieved in recent iterations assufficient to enable commercialisation or does this still need to improvefurther?


Relationship with Western Digital

24. Has Western Digital defined a conditional set of technicalparameters to 4DS which, if met, would potentially encourage it to pursue a commercialtransaction with us?


Relationship with IMEC

27. Under what circumstances do you see the royalty claim beinginitiated with IMEC, given the development steps and agreement timeline?


Technical Parameters for Commercialisation

28.4DS in its most recent announcement stated that itidentified a potential modest degradation of endurance with the one order ofmagnitude boost in read speed. Company testing has shown that endurance ofthese improved cells was several orders of magnitude better than NAND. However,the announcement implied that this is not good enough.

Pleaseexplain why the degraded endurance is not good enough and tell us how muchbetter than NAND our memory endurance must be to be acceptable for the nascent SCMmarket?

30. Development of technology cancontinue forever but shareholders would like aclearer time frame as to when 4DS expect to achievea satisfactorily working Mb chip. Now that thetimeline has, yet again, been pushed out, on this occasion by minimum9 to 12 months, what assurances can 4DS give shareholders that we are actuallyticking the boxes that will lead to acommercially viable Mb chip? When do 4DS believe they will beable to wrap this up?

Financial

31. Assessment of our cash balance suggests thatwe are in for another Capital Raise. If this is the case,will 4DS be seeking a premium value or a value that reflects the sales poolbonus? If not, how do you convince shareholders to see value after the recentmajor drop in share price all the while both currentand former executives are seen to be reducing theirportfolio coupled with the absence of any on-marketpurchases?