REG - Sondrel (Holdings) - Posting of AR, Notice of AGM, Share Option Plans

Sondrel (Holdings)Announcement

01/06/2023 09:45

For best results when printing this announcement, please click on link below:
http://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20230601:nRSA3376Ba&default-theme=true

RNS Number : 3376B  Sondrel (Holdings) plc  01 June 2023

01 June 2023

Sondrel (Holdings) plc

("Sondrel", the "Company" and together with its subsidiaries the "Group")

 

Posting of Annual Report, Notice of AGM and Proposed Share Option Plans

 

Sondrel (AIM: SND), the fabless semiconductor business providing turnkey
services in the design and delivery of 'application specific integrated
circuits' ("ASICs") and 'system on chips' ("SoCs") for leading global
technology brands, announces that the Company's annual report and accounts for
the year ended 31 December 2022 ("2022 Annual Report") and notice of the
Company's 2023 Annual General Meeting ("Notice of AGM"), which will be held at
1.00p.m. on 27 June 2023 at the offices of Cenkos Securities, 6-8 Tokenhouse
Yard, London EC2R 7AS, have been sent to shareholders and are now available to
view on the Company's website at https://ir.sondrel.com/investors
(https://ir.sondrel.com/investors) .

 

As stated in the Company's admission document dated 13 October 2022, the
Directors believe that the success of the Group will in part depend on the
Group's ability to continue to attract and retain talent. With no further
options capable of being issued under the Company's historical share option
scheme, the Directors stated that they would consider the implementation of
new incentive arrangements, suitable for a Company admitted to trading on AIM,
in due course following admission.

 

Having received independent professional advice on the proposed arrangements,
resolutions 10 to 12 to be proposed at the AGM deal with the Company's
proposal to establish the Sondrel (Holdings) PLC Enterprise Management
Incentive Plan (the "EMI Plan"), the Sondrel (Holdings) PLC Non-Tax Advantaged
Plan (which is Part II of the EMI Plan) (the "Unapproved Plan"), the Sondrel
(Holdings) PLC Restricted Stock Unit Plan (the "RSU Plan") and the Sondrel
(Holdings) PLC 2023 Phantom Cash Plan (the "Phantom Plan") (together, the
"Plans").

 

The Plans are being proposed to retain, reward and incentivise key employees
("Participants"). The Company considers the Plans essential in order to
recruit, retain and reward key employees for the benefit of the Company and
its members.

 

As at the date of this announcement, the Company has 3,120,000 options over
new ordinary shares in the Company in issue representing 3.6 per cent. of the
Company's issued share capital. Awards made under the Plans will be notified
in due course.

 

The maximum number of Ordinary Shares in respect of which options may be
granted under the Company's share incentive arrangements at any time operated
by the Company shall not exceed 10 per cent. of the Company's issued share
capital in any 10 year period.

 

Further details of the Plans are set out below and in the Notice of AGM.

 

 

 Sondrel (Holdings) plc                                        Via Buchanan
 Graham Curren, CEO                                            Tel: +44 (0) 20 7466 5000
 Joe Lopez, CFO

 Cenkos Securities plc                                         Tel: +44 (0)20 7397 8900
 Ben Jeynes / Katy Birkin / George Lawson - Corporate Finance
 Alex Pollen / Michael Johnson - Sales

 Buchanan Communications                                       Tel: +44 (0) 20 7466 5000
 Chris Lane                                                    sondrel@buchanan.uk.com (mailto:sondrel@buchanan.uk.com)

 Stephanie Whitmore
 Jack Devoy
 Abby Gilchrist

 

About Sondrel

Sondrel is a UK-based fabless semiconductor company specialising in high end,
complex digital Application Specific Integrated Circuits (ASICs) and System on
Chips (SOCs). It provides a full turnkey service in the design, prototyping,
testing, packaging and production of ASICs and SoCs.

 

The Company is one of only a few companies capable of designing and supplying
the higher-spec chips built on the most advanced semiconductor technologies,
selling into a range of hyper growth end markets such as high-performance
computing, automotive, artificial intelligence, VR/AR, video analytics, image
processing, mobile networking and data centres.  Sondrel designs have enabled
products by leading technology brands including Apple (iPhone), Sony
(PlayStation), Meta's (Oculus), Samsung, Google and Sony smartphones, JVC
(prosumer camcorders), Tesla and Mercedes-Benz cars.

 

Sondrel is well-established, with a 20-year track record of successful
delivery, supported by long standing ecosystem partnerships including Arm,
TSMC and Samsung. Headquartered in the UK, Sondrel has a global presence with
offices in UK, USA, China, India and Morocco.

 

For more information please visit: www.ir.sondrel.com
(https://ir.sondrel.com/) .

 

Details of the Plans

 

Resolutions 10 to 12 - Approval of Share Plans (Ordinary Resolutions)

 

Background

These resolutions deal with the Company's proposal to establish the Sondrel
(Holdings) plc Enterprise Management Incentive Plan (EMI Plan), the Sondrel
(Holdings) plc Non-Tax Advantaged Plan (which is Part II of the EMI Plan)
(Unapproved Plan), the Sondrel (Holdings) plc Restricted Stock Unit Plan (RSU
Plan) and the Sondrel (Holdings) plc 2023 Phantom Cash Plan (Phantom Plan,
together with the EMI Plan, Unapproved Plan and RSU Plan, the Plans). The
Plans have been proposed to retain, reward and incentivise key employees
(Participants). The Company considers the Plans essential in order to recruit,
retain and reward key employees for the benefit of the Company and its
members.

 

Eligibility

Any employee (including an executive director) of the Company or any of its
subsidiaries will be eligible to participate in the Plans at the discretion of
the Board or the Remuneration and Nomination Committee as applicable.

 

Form of awards

The EMI Plan will enable the Company to grant tax-efficient enterprise
management incentive options to employees, in order to allow the Participants
to acquire Ordinary Shares (EMI Options) in the Company, which vest over a
48-month period from the date of grant.

 

The Unapproved Plan will enable the Company to grant non-tax advantaged share
options to employees, in order to allow Participants to acquire Ordinary
Shares (Unapproved Options) in the Company, which vest over a 48-month period
from the date of grant.

 

The RSU Plan will enable the award of restricted stock units (RSUs) to
Participants in the United States of America (US).

 

The Phantom Plan is intended to enable the award of cash bonuses to
Participants not in the United Kingdom (UK) nor the US. This will broadly
mirror the gain that would have been realised if an Option had been exercised
on the day it vested (Phantom Shares).

 

Structure of the Plans

EMI Plan

EMI Options granted under the EMI Plan will typically be granted at market
value (although the EMI Plan allows the EMI Options to be granted with a
discounted or nil exercise price). The EMI Options shall, where possible, meet
the requirements to qualify as Enterprise Management Incentive (EMI) under the
provisions of Schedule 5 to the Income Tax (Earning and Pensions) Act 2003
(Schedule 5) and therefore qualify for the EMI tax reliefs available to UK
taxpayers. The potential tax treatment for Participants of the EMI Plan is of
a capital nature rather than being subject to Income tax and National
Insurance Contributions (NICs) on the growth in value of the underlying
Ordinary Shares from the date of grant. The exercise price payable in order to
acquire shares under the EMI Plan will generally be based on the market value
on the date of grant.

 

Unapproved Plan

Unapproved Options granted under the Unapproved Plan will be on broadly
similar commercial terms to options granted under the EMI Plan, but they will
not be granted under the provisions of Schedule 5 and as a result will be
subject to income tax and NICs on the date of exercise on the amount by which
the market value of the Ordinary Shares acquired exceeds the exercise price.

 

RSU Plan

The RSU Plan will allow for the grant of awards under the RSU Plan (RSU
Awards) to employees based in the US and will deliver free shares on, or
shortly after, the date that the RSU Awards vest.

 

The Company's intention is to set up and fund an Employee Benefit Trust (EBT)
to acquire Ordinary Shares which will be used to satisfy RSU Awards on
vesting.

 

Phantom Plan

Awards granted under the Phantom Plan (Phantom Awards) will be made to
employees on terms which broadly mirror the terms of an Option granted under
the Unapproved Plan. However, Participants will be entitled to receive a cash
bonus equal to the amount by which the market value of the notional number of
Ordinary Shares subject to the Phantom Award exceeds the exercise price on the
date on which the Phantom Award vests.

 

On vesting of Phantom Shares the participant will receive a cash payment via
payroll. The cash payment will depend on the value of Ordinary Shares on
vesting. There shall be no exercise price or purchase price payable. The
Phantom Plan will be initially available to Indian and Moroccan employees with
the possibility of expanding this plan to other jurisdictions in the future.

 

Pensions

Gains and benefits received under the Plans will not be pensionable.

 

A copy of the EMI Plan rules (incorporating the Unapproved Plan rules) (EMI
Rules), RSU Plan rules (RSU Rules) and Phantom Plan rules (Phantom Rules) are
available for inspection at the place of the AGM for at least 15 minutes prior
to, and during, the meeting. A copy of the EMI Rules, RSU Rules and Phantom
Rules will be available for inspection at Sondrel (Holdings) plc, Sondrel
House Theale Lakes Business Park, 9 Moulden Way, Sulhamstead, Reading, RG7 4GB
(except Saturdays, Sundays and public holidays) from the date of this Notice
up to and including the date of the AGM.

 

Grant of awards under the Plans

Awards under the Plans may only be granted to Participants within the six-week
period following (a) the approval of the Plans by shareholders, (b)
announcement of the Company's results for any period, (c) in relation to any
person the day on which the person first joins the group, or (d) any day on
which the Remuneration and Nomination Committee determines that exceptional
circumstances exist. However, if the Company is restricted from granting in
any such period, awards may be granted in the period of six weeks following
the relevant restriction being lifted.

 

Vesting schedule and performance conditions

EMI Options, Unapproved Options, RSU Awards and Phantom Awards (all together,
Awards) are all subject to the same vesting schedule. On the vesting date, EMI
Options and Unapproved Options will be exercisable. On the vesting dates, RSU
Awards and Phantom Awards will immediately be settled. The vesting schedule of
the initial awards is as follows:

 

·    24 months after the date of grant, 50% will vest.

·    36 months after the date of grant, 25% will vest.

·    48 months after the date of grant, 25% will vest.

 

The Remuneration and Nomination Committee or the Board (as applicable) can, in
its absolute discretion, adjust the vesting schedules for future awards under
the Plans as it sees fit.

 

The initial Awards will not be subject to any performance conditions. However,
the Remuneration and Nomination Committee and/or the Board as applicable will
determine whether future Awards are subject to performance conditions.

 

Corporate event

In the event of a change of control of the Company, Awards will vest and
Options may be exercised to the extent vested. However, the Remuneration and
Nomination Committee or the Board as applicable in their absolute discretion
may determine that some or all of the unvested Awards shall vest. Options will
then be exercisable for a short period following which they shall lapse.

 

In the event of an internal reorganisation, Participants will be permitted to
exchange their Awards for equivalent awards which relate to shares in a
different company.

 

If notice of a voluntary winding up of the Company is given, the Company shall
notify all Participants as soon as practicable and any options shall be
exercisable conditional on the resolution being passed.

 

Leaver provisions

Awards will be subject to good and bad leaver provisions.

 

A "Good Leaver" will be a participant who ceases to be an employee because of
any of ill health, injury, disability, death or where the Board so determines
in its discretion. Being a Good Leaver will mean the participant may keep and
exercise a time pro-rated proportion of the Options. RSU Awards or Phantom
Awards will also vest, based on the number of days which have elapsed between
the date of grant and the date of cessation or death (as applicable) as
compared to the number of days in the vesting schedule.

 

A "Bad Leaver" will be a participant who ceases to be an employee and is not
classified as a Good Leaver. If a participant is a Bad Leaver their Awards
shall lapse immediately.

 

Exercise & vesting

Once vested, options will then normally be exercisable until the 10th
anniversary of the date of grant. Options will not vest and be exercised while
disciplinary proceeds are underway against the Participant or their conduct is
being investigated.

 

To exercise an option the Participant is required to provide a notice of
exercise in a form prescribed by the Board and payment of the exercise price.
A notice of exercise is available from the Board on request.

 

RSU Awards do not require a notice of exercise for Participants to receive
their Ordinary Shares subject to the RSU Awards. Ordinary Shares will be
issued shortly after vesting.

 

Any Ordinary Shares or cash that are to be issued, transferred or paid (as
appropriate) to a participant in respect of a vested RSU Award or Phantom
Award or an exercised option will be issued, transferred or paid (as
appropriate) within 30 days of the date of vesting or exercise (as
appropriate). A notice of exercise is not required for Participants to receive
their cash bonus under the Phantom Plan. The cash bonus will be paid shortly
after vesting.

 

Payroll

There should be no obligation to operate payroll on the exercise of
qualifying, market value EMI Options. Gains on the Unapproved Plan, RSU Plan,
and Phantom Plan will be subject to payroll and appropriate employers' social
security.

 

Company Limits

The number of Ordinary Shares that may be issued pursuant to the grant awards
under the EMI Plan and Unapproved Plan when aggregated with the number of
Ordinary Shares issued or issuable pursuant to any other share option plan
operated by the Company shall not exceed 10% of the Company's issued ordinary
share capital at the relevant date of grant.

 

The number of Ordinary Shares that may be issued pursuant to the grant awards
under the RSU Plan shall not exceed 5% of the Company's issued ordinary share
capital at the relevant date of grant. For the avoidance of doubt, shares
transferred out of treasury count towards this limit, as do shares issued or
issuable to the trustee of an employees' trust. However, shares issued or
issuable to the trustee of an employees' trust are not counted a second time
if such shares are subsequently used to satisfy awards.

 

The overall limit for new awards under the EMI Plan, Unapproved Plan and RSU
Plan is 15% of the Company's issued ordinary share capital at the relevant
date of grant.

 

The limit for the Company on the value of its Ordinary Shares that can be
subject to options granted under the EMI Plan in total based on the share
price on the date of grant is £3 million.

 

Individual limits

 

EMI Plan and Unapproved Plan

The Company may not grant an option or options to any participant if that
grant would result, in the aggregate market value of Ordinary Shares subject
to the options made to that participant in that year exceeding 100% of the
Participant's base salary (as determined at the proposed date of grant).

Schedule 5 includes the limit on the total value of Ordinary Shares under
options granted under the EMI Plan that any Participant can receive is
£250,000 based on the market value on the date of grant of the options.

 

RSU Plan

The Company may not grant an award to any Participant if that grant would
result, in the aggregate market value of Ordinary Shares subject to the award
made to that Participant in that year exceeding 200% of the Participant's base
salary (as determined at the proposed date of grant).

 

Phantom Plan

The Company may not grant an award to any Participant if that grant would
result in the aggregate market value of Ordinary Shares subject to the award
made to that Participant in that year exceeding 100% of the Participant's base
salary (as determined at the proposed date of grant).

 

 

 

 

 

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
 or visit
www.rns.com (http://www.rns.com/)
.

RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
.   END  MSCGIGDLGXGDGXB