- BrainChip Holdings (BRN) enters into a second amendment to its put option agreement with LDA Capital
- The amendment allows BRN access to capital, when necessary, until December 2023 and increases the total funding available under the deal to $65 million
- The change also allows the company to defer its remaining $5.3 million draw-down obligation from the end of October, 2021, to the end of February, 2022
- Shares in BrainChip Holdings are trading 1.92 per cent up at 39.8 cents at 11:45 am AEDT
BrainChip Holdings (BRN) has entered into a second amendment to its put option agreement with LDA Capital.
The artificial intelligence (AI) technology provider and LDA have agreed to the change that will grant BRN access to capital, when necessary, until December 2023. This will increase the total funding available under the agreement to $65 million.
The amendment will also allow BrainChip to defer its remaining $5.3 million draw-down obligation, which was initially due at the end of October, until the end of February next year.
Upon completion of the first draw-down period, the company said a second period would become effective immediately, requiring BRN to draw-down an additional $15 million by the end of December 2022.
A third period, also carrying a $15 million minimum draw-down obligation, will begin on January 1, 2023, and close at the end of December of the same year.
BrainChip said any issue of shares as a result of capital calls above the minimum draw-down amount would be subject to the company’s available placement capacity at the time and, otherwise, any required regulatory and shareholder approvals.
Further, the pricing formula used to determine LDA’s purchase price for shares placed under the second and third draw-down periods is set to increase from 90 per cent of the average of the daily volume-weighted average prices (VWAPs), per the original deal, to 91.5 per cent of the average of the daily VWAPs throughout the pricing period.
BrainChip Chief Financial Officer Ken Scarince said the company was pleased with its relationship with LDA Capital and looked forward to working with the team to finance the commercialisation strategy for its Akida product.
“In order to keep our substantial edge in the AI market, we will continue to aggressively invest in our technology,” he said.
LDA Capital Managing Partner Anthony Romano said the company was delighted to extend its long-term financing partnership with BRN.
“Brainchip’s Akida technology is a long overdue disruption to the Edge AI technology market and LDA will continue to meet the evolving financing needs of BrainChip through commercialisation,” Mr Romano said.
Shares in BrainChip Holdings were trading 1.92 per cent up at 39.8 cents at 11:45 am AEDT