Seeing Machines Limited Issue of Shares to Directors and Staff & TVR (6580C)

TIDMSEE

RNS Number : 6580C

Seeing Machines Limited

19 October 2015

Seeing Machines Limited

Issue of Shares to Directors and Staff

and Total Voting Rights

19 October 2015

Seeing Machines (AIM: SEE), the AIM-listed company with a focus on operator monitoring and intervention sensing technologies and services, announces that on 16 October the Board resolved to issue equity to directors and staff under the terms of the Company's share plan. In line with the Company's usual practice of conducting annual reviews of performance and remuneration, the Company is issuing equity to staff based on performance for the 2015 financial year. The Company is also issuing shares as part of the remuneration of non-executive directors.

Issues to Staff

The Company is making the following offers of equity to staff:

General staff offer: The first offer is a general offer of new fully paid ordinary shares of no par value ("New Ordinary Shares") to eligible staff who are not covered by the Company's other incentive schemes. These staff will each receive New Ordinary Shares equivalent to AUD 3,750 (GBP 1,774), pro-rated for staff who were not eligible for the full financial year. The issue price is 4.83 pence per share, being the average closing mid share price on AIM over the 5 trading days beginning on 21 September 2015, when the Company released its 2015 annual accounts. A total of 1,553,697 New Ordinary Shares will be issued to 81 staff. There are no loans for these shares and they vest on issue.

Executive Short Term Incentive: The second offer is an offer of New Ordinary Shares to nine executives as a short term incentive, and based on Company and personal KPI achievement for the 2015 financial year. The issue price is 4.83 pence per share, the same as the general staff offer. The number of shares issued to each executive varies based on their remuneration and performance. A total of 564,413 New Ordinary Shares will be issued under this offer. There are no loans for these shares and they vest on issue.

Executive Long Term Incentive - Performance Rights: The third tranche is an offer of performance rights to ten executives as a long term incentive. This does not involve the immediate issue of any New Ordinary Shares.

In recent years the Company has used a trust and loan structure as a long term incentive, whereby shares are issued up-front but held by a trustee, and the shares only vest for the benefit of executives if certain conditions are met (in which case the Company provided a loan to enable the executives to purchase their allocated shares). In July 2015 the Australian Government changed the tax laws governing employee equity plans, with the general effect that employees may now defer tax on equity offers in more circumstances, including when they receive performance rights or options. As a result of these changes, the Board has adopted performance rights as a long term incentive tool, instead of using a more complex trust and loan structure.

Consistent with recent long term offers, the executives are only able to exercise the rights, and have New Ordinary Shares issued to them, if, after three years from the end of the relevant financial year (i.e. for this offer, 1 July 2018): (a) the Company's share price meets a target share price set by the Board when it made the offer; and (b) the executive is still employed by the Company (subject to a limited number of exceptions). The rights vest in proportion to the target share price. If less than 90 percent of the target share price is achieved, then none of the rights vest.

If these conditions are met then the executive may exercise their rights and the Company will issue the number of New Ordinary Shares set out in the offer. The issue price of the New Ordinary Shares is 4.83 pence, consistent with the other offers. The number of rights offered to each executive varies based on their remuneration and performance. If all vesting conditions are met and all offers are exercised, a total of 5,965,559 New Ordinary Shares would be issued under these offers.

Executive Directors: Managing Director Ken Kroeger and Finance Director James Walker are participating in the 2(nd) and 3(rd) offers. Their shareholdings are described below:

Ken Kroeger

 
 Ordinary shares              2,272,357   Held through Cook Kroeger Superannuation 
                                           Fund 
--------------------------  -----------  ----------------------------------------- 
 Long term incentive plan     2,803,125   Shares issued in 2012, vested 
  - vested                                 but still held by trustee 
--------------------------  -----------  ----------------------------------------- 
 Long term incentive plan     4,089,628   Shares issued in 2013 & 2014, 
  - not vested                             not vested 
--------------------------  -----------  ----------------------------------------- 
 This offer - short term         64,286   Ordinary shares 
  incentive 
--------------------------  -----------  ----------------------------------------- 
 This offer - long term       1,680,684   Performance rights, not vested 
  incentive 
--------------------------  -----------  ----------------------------------------- 
 Sub-total - ordinary 
  shares and vested           5,139,768 
--------------------------  -----------  ----------------------------------------- 
                     Total   10,910,080   Includes all unvested shares 
                                           and performance rights 
                                           Represents approximately 1.15 
                                           percent of total voting rights 
                                           in the Company 
--------------------------  -----------  ----------------------------------------- 
 

James Walker

 
 Ordinary shares               600,000   Held through Kirri Cove Pty Limited 
--------------------------  ----------  ------------------------------------ 
 Long term incentive plan    2,691,532   Shares issued in 2013 & 2014, 
  - not vested                            not vested 
--------------------------  ----------  ------------------------------------ 
 This offer - short term        69,796   Ordinary shares 
  incentive 
--------------------------  ----------  ------------------------------------ 
 This offer - long term        684,279   Performance rights, not vested 
  incentive 
--------------------------  ----------  ------------------------------------ 
 Sub-total - ordinary 
  shares and vested            669,796 
--------------------------  ----------  ------------------------------------ 
                     Total   4,045,607   Includes all unvested shares 
                                          and performance rights 
                                          Represents approximately 0.42 
                                          percent of total voting rights 
                                          in the Company 
--------------------------  ----------  ------------------------------------ 
 

Issue of Shares to Non-Executive Directors

As foreshadowed in the 2014 Annual Report, during the 2015 financial year the Board re-structured non-executive directors' remuneration to include an equity component, in order to more closely align their interests with shareholders. Each non-executive director will receive 25 percent of their fee in the form of New Ordinary Shares, issued annually in arrears.

A total of 832,992 New Ordinary Shares will be issued in respect of the 2015 financial year, allocated to non-executive directors as set out in the table below. The issue price is 4.83 pence, the same as the offers of shares to staff.

 
 Director           New Shares   New Total Shareholding   Percent of total voting 
                     issued                                rights 
-----------------  -----------  -----------------------  ------------------------ 
 Terry Winters         260,310                1,892,476           0.20 % 
-----------------  -----------  -----------------------  ------------------------ 
 David Gaul            130,155                3,530,155            0.37% 
-----------------  -----------  -----------------------  ------------------------ 
 James Walker          156,186                  156,186            0.01% 
-----------------  -----------  -----------------------  ------------------------ 
 Rudy Burger           130,155                  156,186            0.01% 
-----------------  -----------  -----------------------  ------------------------ 
 Michael Roberts       156,186                5,151,562            0.54% 
-----------------  -----------  -----------------------  ------------------------ 
 

The value of the New Ordinary Shares is included in the cap on non-executive directors' remuneration as set out in the Company's Constitution.

Admission to AIM and Total Voting Rights

A total of 2,951,102 New Ordinary Shares will be issued to staff and directors under the offers described above. Application will be made for these 2,951,102 New Ordinary Shares to be admitted to trading on AIM. It is expected that admission will occur on 23 October 2015. Immediately following the admission of the New Ordinary Shares, the Company will have 943,929,411 ordinary shares in issue.

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October 19, 2015 05:00 ET (09:00 GMT)