Ok everyone needs to take a deep breath and actually read the fine print. The Directors are not being gifted the shares just for remaining in their respective roles they are subject to the terms and conditions set out in Annexure "A" which is the employee incentive scheme requirements which require the Board to set goals and those goals be achieved before the shares are vested on the due dates. So Director Steele could be tasked with project A to achieve result B by a given date and if she does the Board can then approve the receipt by her of the options at the stated price. If Director Steele fails to achieve this result then she does not get the options. The Board should be encouraged to explain to shareholders before granting the options what the project A was and what value it created for shareholders having been successfully completed.
I have reproduced and highlighted the relevant parts:
RESOLUTIONS 8(A) AND (B) – APPROVAL OF ISSUE OF OPTIONSTO DIRECTORS Background Subject to the approval of Shareholders, the Company proposes to grant a maximum amount of a) 2,500,000 Options to Christa Steele, Non- Executive Director; and b) 2,500,000 Options to Geoffrey Carrick, Non-Executive Director. The exercise price payable for on exercise of each Option is as outlined in the table below. The objective of the proposed grant of Options to Directors is primarily to link the reward of Options to Shareholder value creation, and align their interests with those of Shareholders and to encourage the long-term sustainable growth of the Company.The Options shall be issued under, and subject to, the terms of the EquityIncentive Plan. Listing Rule 10.14 provides that a company must not issue equity securities to a director of the company under an employee incentive scheme unless the issue has been approved by 18 holders of ordinary securities. Once approval is obtained pursuant to Listing Rule 10.14, the Company is entitled to rely on Listing Rule 10.12, Exception 8 as an exception to any requirement that may otherwise apply requiring shareholder approval under Listing Rule 10.11. Similarly, approval will not be required under Listing Rule 7.1
Appendix A Summary of the material terms of the EquityIncentive Plan
The Company proposes to adopt an equity incentive plan known as the BrainChip Long Term Incentive Plan prior to the Meeting ("LTI Plan"), to assist in the retention and motivation of the Company's employees , directors and consultants (together the "Eligible Participants").
The LTI Plan is intended to assist with aligning the interests of participants with shareholders by providing an opportunity for Eligible Participants to earn equity interests in the Company. Under the rules of the LTI Plan, the Board has discretion to offer any of the following awards to Eligible Participants: • options to acquire Shares; • Options to acquire Shares; and/or • Shares, (collectively, the “Awards”). In each case the Awards can be made subject to vesting conditions and/or performance hurdles as determined by the Board. The terms and conditions of the LTI Plan are set out in comprehensive rules. A summary of the rules of the LTI Plan is set out below: • The LTI Plan is open to Eligible Participants and other persons providing services to the Company or its related bodies corporate, as determined by the Board. • Participation is voluntary. • The Board may determine the type and number of Awards to be issued under the LTI Plan to each participant and other terms of issue of the Awards, including but not limited to: § what conditions and/or performance hurdles must be met by a participant in order for an Award to vest (if any); § the amount payable to be paid by a participant on the grant of Awards (if any); § the exercise price of any option granted to a participant; § the period during which a vested option can be exercised; and § any forfeiture conditions or disposal restrictions applying to the Awards and any Shares that a participant receives upon exercise of their options or vesting of Options. • When any conditions and/or performance hurdles have been satisfied, participants will receive fully vested Shares or their options/Options will become vested and will be exercisable into Shares (as applicable). • Each vested option and performance right enables the participant to be issued or to be transferred one Share upon exercise or vesting (as applicable), subject to the rules governing the LTI Plan and the terms of any particular offer. • Participants holding options or Options are not permitted to participate in new issues of Securities by the Company but adjustments may be made to the number of Shares over which the options or Options are granted and/or the exercise price (if any) to take into account changes in the capital structure of the Company that occur by way of pro rata and bonus issues in accordance with the rules of the LTI Plan and the ASX Listing Rules. 26 • If a "change of control event" occurs to the Company, and unless the Board determines otherwise: § Awards granted will vest where the Board determines that the vesting conditions and performance hurdles applicable to those Awards have been satisfied, with vesting to occur on a pro rata basis having regard to the vesting period and actual performance; § any options and Options which the Board determines will not vest under the above sub-paragraph will automatically lapse; and § any Share Awards which the Board determines will not vest under the above subparagraph will automatically be surrendered by the participant. A "change of control" event includes an event when a person or entity becomes a legal or beneficial owner of 50% or more of the issued capital of the Company; a person or entity becomes entitled to, acquires, holds or has an equitable interest in more than 50% of the issued share capital of the Company, a takeover bid or scheme of arrangement occurs, a sale of all or substantially all of the assets of the Company occurs, or a change in the composition of the Board effected by shareholders occurs against the recommendation of the Existing Board which results in a majority of the Board being replaced over a two year period. • If a participant becomes a "bad leaver", unless the Board determines otherwise: § any and all vested options and Options held by the participant which have not been exercised will continue in force and remain exercisable for a period of 90 days commencing on the date of termination of the Participant’s employment or engagement with a Group Company; § the participant will be entitled to continue to hold all vested Share Awards; § all unvested options and/or Options held by the Participant will automatically lapse; and § all unvested Share Awards held by the Participant will be automatically surrendered by the Participant. A participant will be a "bad leaver" if the participant resigns, is terminated for performance or is terminated or dismissed for misconduct. • If a participant is a "good leaver", unless the Board determines otherwise: § any and all vested options and Options held by the participant which have not been exercised will continue in force and remain exercisable for a period of 90 days commencing on the date of termination of the Participant’s employment or engagement with a Group Company; § the Participant will be entitled to continue to hold all vested Share Awards; and § the Board may determine the manner in which any unvested Awards held by the participant will be dealt with. A participant is a "good leaver" if they are not a "bad leaver". • The Board may delegate management and administration of the LTI Plan, together with any of their powers or discretions under the LTI Plan, to a committee of the Board or to any one or more persons selected by them. • Subject to the Listing Rules and the Constitution, the Board may at any time amend the LTI Plan or the terms and conditions upon which Awards have been issued under the LTI Plan provided, generally, that the amendment does not materially reduce the rights of any Participant in respect of Awards granted to them. 27 • The Board may elect to use an employee share trust or other mechanism for the purposes of holding Awards and/or Shares for Participants under the Plan, and delivering Plan Shares on behalf of Participants upon exercise of options and/or Options (as the case may be). • Awards may be granted to Eligible Participants residing in Australia, the United States of America, France, India or other jurisdictions, as approved by the Board from time to time, under the LTI Plan subject to any local law and local tax requirements.
My opinion only DYOR
FF.
AKIDA Ballista
(20min delay)