Good afternoon, everyone. Good to see politeness and direction. My name is Dadi Perlmutter, and I have the privilege of being the chair of Weebit Nano. It is my pleasure to welcome you to the 2024 Annual General Meeting of Weebit Nano Limited. It is now 3:00 P.M. AEDT, the time appointed for the meeting, and as we have a quorum, I declare the meeting open.
The notice of meeting was distributed on 24 October 2024, which set out the business and resolutions to be considered in this meeting, and I will take the notice of meeting as read. In addition to our in-person meeting in Sydney, we're also conducting the meeting with a virtual component. This hybrid format allows shareholders and proxies, wherever they may be, to attend virtually. All shareholders and proxies can ask questions and vote today.
For those of you online, should you experience any technical difficulties, a recording of the AGM will be available on our website following the meeting. If you experience any technical issues during the meeting, a short recess may be required. Should this occur, we will communicate accordingly. Shareholders will have the opportunity to ask general questions after the conclusion of the formal items of business.
For those attending virtually, please see the steps as outlined on the screen. For those attending the meeting in person, please raise your hand when prompted, and you will be called upon at the appropriate time. Today, I'm joined by my fellow directors, CEO Coby Hanoch, Ashley Krongold, and Naomi Simson.
Today, we have also presented our CFO, Alla Felder, online, representative from our company secretary office, company members, Anna and Gabriel. Michael Fay, our auditor from Nexia Perth, is online, and Michael Stratton from our share registry, Computershare Investor Services, will also act as our returning officer.
I guess Eric Kuret from Automic, our IR.
Sure.
And sitting next to him, just.
You helped me write the document.
Since I'm already interrupting, we have Andrew Johnson there from MST, who wrote an analysis report about Weebit, and we'll talk about it later.
I would like to make a short statement as Chair. Heading into calendar year 2025, the board feels confident that Weebit Nano can deliver over the next 12 months. This is because Weebit has now tied its accountability to deliver on its commercial agreements to its proponents. As outlined in today's resolution, there will be no allocation of equity to the CEO unless specific milestones are met, including signing three licensing agreements with new foundries and/or integrated device manufacturers. Signing.
Just for the people online, stand for the lectern.
Oh, yeah. I'm sorry.
The camera looks at people online.
Stand. Okay. Yeah. Oh, they want to see my face.
Yeah.
I forced you to work.
I'm sorry?
I forced you to work.
Yeah.
I want to make some makeup or something, and I know.
I haven't.
Okay. I'll repeat the last sentence. There will be no allocation of equity to CEO unless specific milestones are met, including signing three licensing agreements with new foundries and/or integrated device manufacturers, signing three new agreements with product companies, and completing qualification with DB HiTek. Moreover, we have decided for the same reason not to allocate any equity this year to the Chairman and Director.
I believe this is a true indication of the confidence we have and the importance we see in achieving this milestone for the success of the company long-term. I believe an ability to sign customer agreements is the utmost importance we give to the achievement of these goals. We are here to talk about Weebit, but geopolitical and economic world around us is undergoing huge shifts.
First, from an economic point of view, post-COVID, higher inflation, higher interest rates, though trending down the last few quarters in most places, is affecting investment appetite with investment valuation, with investment in tech reduced from the peak reached in 2022. Secondly, the geopolitical strife in
Europe and the Middle East continues, and cross-border economic tensions are growing over technology and semiconductors, and with the new election in the U.S., may change this situation even further. I'm not going to try to tell you what direction I believe it would, but we'll take some direction, that's for sure, and the cross-border economic tensions are growing over technology like semiconductors, AI, cybersecurity, and finance between the West and the BRICS nation.
Third, the move into new technologies and the acceleration of the digital transformation, with the advent of AI that came to our life in the past few years, is creating huge demand for semiconductor products. I always say that semiconductors to the digital world and AI-based world is like oil to the industrial economy. Without semiconductors, nothing that you see exists.
And finally, Weebit has quickly adjusted to the conditions of the war in the Middle East of the last 14 months, with minimal to no impact on its execution as a company. Weebit continues to utilize its resilience, its ability to cope with these ongoing changes, to drive its next phase of growth. Weebit Nano has had another momentous year in our achieving in our journey to bring its next-generation non-volatile memory to market.
With a strongly supported share placement of AUD 50 million, with 65% premium over the five-day VWAP just a couple of weeks ago. During the past year, the company secured its first licensing revenues of AUD 1 million through the commercial agreement with the Tier 1 foundry, DB HiTek, and proved that our embedded ReRAM can function in higher temperature and in near cyclical operation at smaller geometries, which is critically important to very important markets like automotives and industry.
Our recent fundraising reflects a strong support from institutional investors. While Weebit already had an adequate cash balance, we could not ignore the request of institutional investors wanting to invest in Weebit and willing to do so at the premium.
The placement provides the company with resources to accelerate our commercialization activities, as well as our technology development, and provide manufacturing for doing that activity. I would like to apologize to our loyal shareholders as we did not manage to follow this raise this time with a share purchase plan or entitlement offer as we always did.
ASX regulation made it impossible this time due to a strong placement price. The team's commercial and technical progress over the past 12 months has validated Weebit as one of just three known companies with qualified ReRAM technologies across the globe as the only independent provider of a qualified ReRAM. According to industry research firm Yole Group, ReRAM is set to represent more than half of the emerging non-volatile memory market in terms of volume by 2029.
There is a large opportunity for its ReRAM technology in fields including power management, microcontrollers, automotive, and beyond, and we probably will even talk about some potential opportunities created by artificial intelligence. Semiconductor companies are looking for more advanced technologies as the state of the global industry gets stronger.
Semiconductors are everywhere and will continue to expand to every aspect of our life in the short, medium, and long term. By 2030, the semiconductor market as a whole is expected to reach $1 trillion in value. According to McKinsey, perhaps we'll be looking for advanced IP solutions for the clients, providing a growing opportunity for it. Despite Weebit's significant progress, full year 24 has had its challenges.
Factors beyond the control, such as missing IPs in SkyWater's foundry offering, have delayed licensing agreements with other companies at SkyWater's, while complex technical evaluations and negotiations with more than a dozen leading foundries and IDMs have taken longer than expected to finalize. These short-term challenges have not dampened our confidence or outlook, and we continue to focus on closing agreements and targeting new licensing deals at calendar year 2024, and as I mentioned earlier,
we set up the performance targets held for our CEO, Coby Hanoch, in equity. Investment analysts are taking note of this rise in demand for cutting-edge semiconductor technologies as they are recognizing the valuable position of Weebit. It's the only independent provider of qualified ReRAM. Coby will get more details on why it is so important in his talk.
This can be seen by research initiation of Weebit over the past year by Unified Capital Partners and MST Financial. As Weebit grows, it is ensuring that its governance practices remain robust in the best interest of all its shareholders. During this year, Weebit further improved its governance by updating the CEO agreement, tightening its governance and remuneration procedures, streamlining operation procedures, and restructured board committees to exclude executives.
An example of implementing these practices was the transition of Dr. Yoav Nissan-Cohen from an executive director to a non-executive director, a step towards a more independent board. Mr. Nissan-Cohen has been instrumental in guiding the company's technical team in its early days and will continue to benefit from experience in his non-executive role. Another thing that we did was we also added a little bit more than a year ago, Naomi Simson as our first female director.
As I mentioned many times, we're looking into increasing the amount of representation of females in our board of directors in the company going forward. The team at Weebit has brought the company to where it is today and helped create a bright and important future.
I thank them for their dedication and bringing our ReRAM technologies to life. I would like also to acknowledge the ongoing support of Weebit's shareholders and the belief from them that the company's ReRAM technology is the next NVM to replace flash and other forms of memory in the vertical industry. I'm looking forward to this year ahead in bringing Weebit to its next phase of commercialization and shaping it into a leading provider of ReRAM worldwide. Thank you very much. We're now moving to the more standard procedure. Right?
We'll just turn off the microphone.
Microphone is off?
Yeah.
No, it's.
When I turn it off, we're not going to use it.
Turn it off?
Yes.
Yeah. I think everyone's also with you.
Okay, so I don't need the microphone right now?
No, you're good to speak without everyone on the microphone.
Okay. What the lady says, that's what I'll do. You know, there's always the dilemma when the wise lady tells me to turn right and my wife on the right of me tells me to turn left. What do I do?
That's right.
There's some similarities between the ladies and you could guess. Anyway, the first item of business is to receive and consider the company's annual report, including the director's report and auditor's report for the year ended 30th of June 2024. A copy of the 2024 annual report was made available to shareholders on 24th of October 2024.
There is no formal resolution to put to this meeting in relation to the adoption of the 2024 annual report. I will leave two questions later on after Coby finishes his presentation. I believe that some of the potential questions may be answered by Coby. He may open up new questions for you to ask, so I'm going to defer the questions during Coby's presentation.
Okay, I will start. I'll go to the holding. Do I need microphone now? I should stay intact. As we move towards the formal item of business, I will now address some procedural matters for this meeting. Voting today will be conducted by way of a poll on all items of business. Instructions on how to vote through the Computershare platform are now displayed on the screen in order to provide everyone with the opportunity to vote, and in case anyone cannot stay for the whole meeting, the poll is now open, and you can vote on all resolutions.
I will give you the warning before I move to close voting. For those voting holders physically in the room today, you have received a voting card upon registration. Please complete and display the version of the voting card. Should you require assistance to do this, we have Computershare staff available to assist you.
At the conclusion of the meeting, or if you choose to leave the meeting sooner, please place your completed voting cards in one of the ballot boxes that are located by the exit door. We now come to the formal items of business for the meeting. I will introduce each item of business separately and then respond to questions for that item.
For each item of business, the number of proxy indirect votes received prior to the meeting will be shown on the screen in this room in front of you and displayed via the online platforms. I confirm that I propose to vote those proxies left to my discretion as the chair in favor of all resolutions. Resolution number one, related to the adoption of the remuneration report for the year ended 30th of June 2024, as set out by the notice of meeting and displayed on the screen.
Are there any questions or comments online or on the phone?
There are, Mr. Chair. Question from Mr. Stephen Mayne. I don't understand why you can't offer your retail shareholders an SPP at any price?
Say it again, sorry.
It's a question around why you couldn't offer an SPP, share purchase plan, to shareholders with the placement.
Coby, would you want to answer this one?
It's not related to this. I'll address that when I give the presentation.
Okay. I request, at this stage, questions only related to this specific. Any other questions or comments?
No.
Mr. Chairman, there's no phone question on this item.
Okay. If there are no further questions online or on the phone, are there any questions from those in the room? As there are no questions in the room, I will now table the outcome proxy voting received prior to the meeting as shown on the screen. Okay. We move to the next one. Resolution two relates to the re-election of Dr. Yoav Nissan-Cohen as the director of the company as set out in the notice of meeting and displayed on the screen. Are there any questions or comments online or on the phone?
Mr. Chairman, there's no phone question on this item.
Mr. Chair, questions just come through. Could Dr. Nissan-Cohen comment on how it is working out at a board level being listed on the ASX and being based in Israel? Are we having many or any board meetings in Australia? Are the logistics complicated?
We live in the world. We are an international company by nature. Our business is global, not in Australia. It's all over the world from North America to New York to Asia. A big portion of our team is residing in Israel. We are holding, other than one yearly face-to-face meeting, usually in May, we make the meeting online using video conferencing.
The whole world is working that way. There's nothing unique, nothing significant, and we work extremely effectively using these capabilities. Video conferencing is wonderful. I used to work in an American company from Israel, and we used phone. Trust me, video conferencing is wonderful, and it's very well used. Dr. Yoav Nissan-Cohen is not the only one that resides in Israel. I personally am in Israel as well. Coby is in Israel.
We have another director, which is the next vote, who resides in the U.S., and we continue to be a global company trying to get the talents that we could get from anywhere they are. Any questions coming from this room? If there are no questions in the room, I will now table the outcome of the proxy voting received prior to the meeting as shown on the screen. I'll switch to resolution number three. Resolution three relates to the re-election of Dr. Atiq Raza as the director of the company as set out in the notice of meeting and displayed on the screen. Are there any questions or comments online or on the phone?
Mr. Chairman, there's no phone question on this item.
If there are no questions online or on the phone, are there any questions from those in the room? If there are no questions in the room, I will now table the outcome of the proxy voting received prior to the meeting as shown on the screen.
I'll switch to resolution four. Resolution four relates to the approval of issue of performance rights to Executive Director and CEO of the company, Mr. Coby Hanoch, as set in the notice of meeting and displayed on the screen. Are there any questions or comments online or on the phone?
No. Mr. Chairman, there's no phone question on this item.
If there are no further questions online or on the phone, are there any questions from those in the room? If there are no questions in the room, I will now table the outcome of the proxy voting received prior to the meeting as shown on the screen. I'll switch to resolution five. Resolution five relates to the re-approval of employee investment option plan as set out in the notice of meeting and displayed on the screen. Are there any questions or comments online or on the phone?
Mr. Chairman, there's no phone question on the phone.
If there are no questions online or on the phone, are there any questions from those in the room? If there are no questions in the room, I will now table the outcome of the proxy voting received prior to the meeting as shown on the screen. Resolution six relates to the reinsertion of partial takeover provisions. Well, that's hard in English for me. Are you pronouncing?
Plebiscite .
Okay. Provision in the constitution as set out by the notice of meeting and displayed on the screen. Are there any questions or comments online or on the phone?
There is a question, Mr. Chair, online from Mr. Stephen Mayne. The question is, I don't understand what is wrong with partial takeovers. Which law firm told us to do this? Give partial takeovers a chance.
Coby, are you able to answer this one?
law firm is King & Wood Mallesons, and they basically recommended this.
And it's a corporation's requirement that every three years it needs to be re-approved in order to take, for the company to be able to use it.
The reinsertion is rolling it forward, not starting the whole thing again.
Correct.
Just reiterating.
Correct. Correct.
Very good point.
I hope that was heard by whoever asked. Did they hear it?
It's online.
Oh, okay. Are there no questions online or on the phone? Okay. Is there no further questions online or on the phone? Are there any questions from those in the room? If there are no questions in the room, I will now table the outcome of the proxy voting received prior to the meeting as shown on the screen. I remind those shareholders that wish to vote today who have not already done so to please complete their voting in accordance with the instructions provided in the beginning of the meeting as the call will be closing soon. I'm going to now move the baton to Coby to make sure that, and we'll have a
Mr. Chair, there are some other questions that came through related to some of the resolutions after you moved on.
Okay.
You're happy to take those then?
Okay, so if there are any questions related to the resolution, I'll be more than happy to have them right now or move on.
Okay. Question in regards to resolution five from Mr. Stephen Mayne. There were 15% plus protest votes against the two directors. Do we know which shareholders are giving us grief today and why? Have the protests extended to other resolutions?
I don't think I have any data on who voted how. So I don't really understand why they voted against. I know these two people, probably the top in their profession. They're well known in the industry. One of them worked for the inventor of flash and was managing one of the largest foundries in the world, Dr. Yoav Nissan-Cohen. And Dr.
Atiq Raza is an inventor on his own. He ran a company that was acquired by AMD, and AMD is now the second to NVIDIA in supplying AI and high-performance computing chips. He was the president and chief operating officer of this company. After that, he was running a lot of startups, made multiple exits, and he is well experienced in both large and small companies and a lot of experience in being a director on multiple public companies. So I do believe they are a very strong candidate. Any other questions?
There's another one relating to resolution one, adoption of the remuneration report, again from Mr. Stephen Mayne. Did any proxy advisors produce a report ahead of today's AGM? And if so, did any recommend against this remuneration report item or any other items? And then there's a comment saying it is better practice to disclose the proxies to the ASX along with the formal addresses so I don't have to ask if there have been any material protest votes against today's resolutions.
I don't know of any protest, and the proxy advisors' recommendations are not a public domain. They are being given to their customers for their proposals. So I'll refer them. If you want to ask what they propose, you can ask each of the proxy advisors directly. Are there any more questions?
Not related to the resolution.
Any questions related to resolution in the room? If not, I'll move to Coby presenting, and then we'll have much more general questions on anything related to the resolutions and Weebit in general.
Yes. You can actually stay there because I think the first slides are going to be ones that you present.
Awesome.
I'll let you. Yeah, thanks everyone for coming.
Is that the slides I need to present?
No, this one I'll present. So I think, first of all, since I was here last month.
I'm still here because.
They need to see me.
Your face is nicer than mine, so it's better to see you.
Okay. I'm just saying that I was basically here a month ago, and most of these slides are slides that you saw anyway. So I'm going to skim through some of them. I think we have a great opportunity that Dadi is here so he can give his view of the industry, the state of the semiconductor industry, and so on. So the first slides that we have actually refer more to the global semiconductor industry and where we stand with it, and I'll let you present, I guess, the three slides here.
No, I could talk for a long time about semiconductors. I'm in this business for 45 years now. When I studied semiconductors, people told me in the university that I'm an idiot, that I focus on semiconductors because nothing good will happen out of it. Sometimes I make good decisions for the wrong reasons, but this wasn't the one.
I never anticipated how grand and big and important to the world in general, world economy, economy in particular, in my wildest dream when I joined Intel, who itself was a company with less than $1 billion revenue when I joined Intel. As you see, it's kind of interesting. The world lives and dies on semiconductors.
You see here companies like Microsoft and Apple and Alphabet and Amazon and Meta that you say, "What do they have to do with semiconductors?" First, we use a lot of semiconductors in whatever shape or form in their data centers. All of these companies have their own semiconductors silicon chips development teams. They develop their own devices, predominantly microprocessors. So that's a huge deal.
Why they do that? Because the importance of a Microsoft or a Meta or an Apple of how good their product is, whether it is a phone or a search or an AI computation, they want to control as much as they can to develop their own device. Now, two years ago, I would have mentioned NVIDIA. Most people would have not known who this company is. People that used to do gaming and whatever knew how to appreciate the graphics solution that gamers love.
They had an opportunity and became the largest, probably the highest valued or the second-valued company in the world. I think worth north of $2 trillion just in the past few years, initially due to cryptocurrency computing. And nowadays, 80% plus of AI computation done on NVIDIA GPUs. That's how big it is. And it's going to grow even bigger. TSMC is the largest manufacturer that manufactures all these products for all these most of these products.
And Broadcom is also a well-known semiconductor company, and there are plenty of others. So everyone, including anyone in the room, I think not too many people in the room other than Coby and myself are developing semiconductors, but everybody is using. And I bet you'll be amazed how many semiconductor chips you have in your pockets as we speak. A lot.
When you get to your car, you have several hundred more around you. Every light in a corner and every machine that you use, any vending machine you buy, have a lot of semiconductor chips. That's how pervasive it is. We don't even know anything about this one. This creates a huge amount of opportunities for all the companies. This industry is known for the extremely fast development and improvements. I always love to play with numbers.
So when I joined Intel, the largest, most high-performance microprocessor was the 8086. Some people may remember. The first PC was working using this microprocessor. It has 80,000 components called transistors in it. Could people guess how many transistors are within an NVIDIA latest chip, the latest GPU? Give a number. Be wild.
Million.
Million.
30 billion.
Sorry?
30 billion.
Okay.
Go up. Go up.
Not of 100 billion. And there's another company doing something very bizarre, but they have a few trillions of transistors, but put this one on the side. So this industry improved the technology in less than 50 years by more than six orders of magnitude. There's nothing in the world on anything that has even an order of magnitude, even in a much longer period.
Cars don't go faster, and they're not efficient, even 10x than the first car in the late 19th century. And I could go on and on with examples. It's quite unique. How does that happen? On anything that does a semiconductor, every year, every two years, there's a huge technological development that just feeds the ability to do this miracle of cramming a million times more devices into the same size of chip. It's about that size. So there's a lot of technology.
It has to do with all kinds of things, all kinds of materials, all kinds of chemistry and physics and other crazy stuff, and they look for new technologies. One of the new technologies that they have, probably we believe at the time, is ReRAM, that we believe brings a lot of capabilities into this world and allows people to build even more sophisticated.
Coby will talk a little bit more. I would like to make some of this crazy stuff. This memory has resilience to radiation. You may say, "Who cares?" When you are flying things to space, and the space now requires a lot of technology, there's a lot of radiation, alpha particles. Every particle that hits the memory chip changes the data in the memory. You don't want to have that.
So people put all kinds of crazy stuff on top of this one. Our ReRAM is by far more resilient to this kind of radiation than anything else on the current memories. We talk about speed. We talk about power. We talk about reduction of cost in manufacturing, which is very important for this business. So I think we are talking about the potential of great opportunities on an industry that is doing crazy stuff and will continue to do.
And everybody is trying to do more capable computing, more capable memory, more capable communication devices just to do all and all of this, all of the things that we all do. And we get so used to it, we don't even think about that. But I remember going to the grocery store just 10 years ago. My kids don't go to the grocery store. They put everything online.
How many people use ChatGPT or other stuff? Some of you. I suggest you do that more. It has huge computation. Each time you type a prompt into ChatGPT or Gemini, there's a huge amount of activity happening on the device itself and on the cloud, and you want to get more complicated answers answered. People talk about servicing and all kinds of stuff. All that creates enormous kinds of opportunities to people that bring a new technology on time and cost and writing to do, so now we have our capable CEO to explain to us how he is going to do this miracle.
Actually, can you switch to the next? We have two more slides that maybe you want to comment on before.
Okay.
I'm not going to let you off the hook so far.
Okay. Okay.
It's a global industry. You look where the fabs, fabrication material, this is where people produce these parts. Could someone guess the top-end semiconductor fab, how much does it cost to build it? You want to give a number? Be wild.
We know it's billions of dollars.
Okay. But TSMC announced that the next production fab is going to be $45 billion. So not too many people have enough money in the pocket to do that. It's not just out of the blue. The U.S. government decided to do this CHIPS Act, trying to help companies with tens of billions of dollars to go build factories back in the U.S. to regain the leadership that they lost to Taiwan. And the cost scale of everything, IPs, and all these opportunities are huge. And as you can see, there are two continents with no fabs: Australia and Africa. Other than that, and South America, if you remember.
Antarctica.
I'm sorry?
Antarctica.
Antarctica. There's nothing in Antarctica anyway, but fine. You're right. I'm sorry. So this is a huge industry. And yeah, $800 billion of investment.
In just two years.
Yeah. And people say that the U.S. is trying to put about close to $100 billion in CHIPS Act. It's too little. Now you could see why people say it's too little. Doesn't sound little to me, but it's a big one. So anything else, Coby?
Just one more slide.
One more slide. Okay.
Actually, we added that one. I didn't present it in the past.
Okay. I think I talked to most of you in my talk. But we talked about the governance, the newly joining, licensing revenue. Coby, you mentioned MST.
Actually, yeah. I mentioned Andrew is here, so.
And so I talked about your moving from an executive to non-executive director. We talked about the coverage and the raise. So I think I covered in detail this slide. So it's your turn, Coby.
Now it's my turn.
You don't have to say anymore.
Yeah. So yeah, I already said thank you to Andrew for the MST report. Actually, we have George here from Unified. So the guy that actually stayed up all night to do the raise for us. And Unified also issued a report. So we have actually now two reports from institutional brokers. And I'm very proud of these reports. As I said, I already presented the slides, and I think most of you already saw them. I'm not going to bore everyone. I will focus just on one key message, and then you guys can and I'll talk a little bit about some stuff that came up in this last week. Key points about Weebit and maybe just keeping that focusing on the main things. The world has been looking for a replacement for flash for 20 years and more.
flash, by the way, I was talking to Dadi. I never talked about it to you, but flash actually was invented about 50 years ago. It took them about 20 years to reach the point where they were really getting into the market and started to be used pervasively. And then 10 years later, people started realizing already that, okay, it's great, it's good, but it's going to be hitting the walls, and we need to find something else.
So 20, 25 years ago, people started looking for other technologies. And initially, there was a whole list of them. There was FRAM, there was PCM, there was MRAM, there was RAM, there were all kinds of others. And as time went by, some of them, okay, people understood that's not going to work.
I think about when I joined Weebit, the technology that everyone was talking about, everyone was sure this thing is taking over, was PCM. Intel called it Optane or Micron called it 3D XPoint. It had different names, but everyone, it was really promising. Intel poured billions and billions and billions of dollars into PCM. It ended up being way too expensive to manufacture.
People were joking that every chip that Intel sells with PCM in it, they wrap with $200 bills around it so that people will take it. Intel realized it's going to go bankrupt with this thing, and they stopped it, and then Micron stopped. Today, there is one last company that is still trying to put PCM, STMicroelectronics, Micro, I'm sorry. And even they, it's only on a limited range of products and so on. So PCM moved aside.
There were two left, ReRAM and MRAM. MRAM came out to market first, reached mass production already, I guess, something like five years ago, roughly, and started going. Now, MRAM, almost any advantage that I will say about ReRAM, MRAM has. It's the endurance, the power, the speed, etc. It is similar to ReRAM. It even actually, the endurance, it has better endurance than ReRAM. So people were really excited about it.
However, everyone already understood from the beginning, it uses rare earth materials, and as time passes, people are more and more sensitive to that. Because of that, it requires separate manufacturing lines and very expensive manufacturing lines, as you can understand. In fabs, everything is so expensive, and the manufacturing process itself, because of these materials, because of the way that it works, it requires many, many very thin and delicate layers, and it's not easy to manufacture.
I mentioned in previous presentations, an MRAM adds about 40% to the cost of a silicon wafer. That's a lot. The flash adds about close to 20%. RAM is 5%-10% added cost. But MRAM was there. ReRAM was not, and people were really believing that that's taking over. What really happened was once these products hit the market and they were out there in the field, suddenly everyone woke up and, "Oh my God, we're surrounded by so many magnetic fields all around us.
" They're everywhere. Actually, even the cell phones, when they do the wireless charging, it's magnetic fields that are doing it, etc., etc. And some of the products started failing because the memory was erased or ruined by magnetic fields. And all of a sudden, the consumer companies are there like, "Oh my God, we're not going to touch this thing.
Our products need to go everywhere. We don't have control over where people take these products. No way." And by the way, many of the consumer companies normally don't veto technology so strongly. It's pretty rare, actually, that they come out with a very strong message. "We're not going to use this technology, period."
And what happened is that, and this has been in the last two, three years, that you start seeing all of these announcements and transition of the industry. Just a year and a half ago, TSMC published their roadmap, their non-volatile memory roadmap. It was all MRAM with a comment on ReRAM on the bottom. They had ReRAM in mass production already, but it was still that thing on the side.
But because of all this input that they got from their customers, in June, I think it was June, half a year ago, when they published their updated non-volatile memory roadmap, when you look at that slide, you see all the red lines, which were MRAM, reaching 24, and then bam, and it's all gray lines, which are ReRAM. And it's just a sharp transition.
Everything is ReRAM, and MRAM is now a comment on the bottom. So you can see how the world moved from in 2022, I think that was the first time Infineon announced. Infineon is one of the biggest suppliers to the automotive market. And they announced all of their future products are going to be ReRAM. That actually triggered a lot of automotive companies to start calling Weebit already.
We started getting calls from other guys because, "Hey, we need to compete with Infineon, and we need to have good technology." It moved on to TSMC pushing more and announcing that they have qualified ReRAM also in, I think, in two or three geometries. It was in 2023. UMC announced that they have qualified ReRAM.
And the market started realizing that, "Hey, ReRAM is here." Now, we also, in those years, you remember, we started off with SkyWater. And then last year, we announced DB HiTek. And by the time we get to 2024, this is really that big shift of TSMC making that transition. Weebit is now already engaged with dozens or, let's say, a dozen big foundries, IDMs, and many big product companies.
As we move forward, going into 2025, this is, and I talked many times about just how difficult it is to bring those first companies on board. Dadi kind of commented about it. I think you guys have been commenting to me about it. We were really hoping that already in 2024, we would be able to close more deals. We really believed that things would move a little faster, but the human nature of just avoiding risk. We've had companies tell us, "We know we're going to be using ReRAM, but we're going to really make this last project still work with flash.
We want to see someone else be the first one," so we know it's not going to be the most optimal, the best thing, but this is what we know works, and we don't want to take any risk, and we'll make it work. When I joined the industry in those days, the chips that I was working on were even less than 80,000 transistors.
There was the saying that nobody got fired for buying IBM. Okay? There were better computers, cheaper, whatever, but you buy IBM, even if you fail, nobody's going to fire you. If you buy the new thing, you have a risk. Today, it's the same thing. Nobody gets fired for buying flash. You decide to use flash, and if you have a problem with your product, okay.
But if you start using Weebit's ReRAM and you fail, the risk is higher. So that's basically where we're at. We're at this point where everyone knows they need ReRAM. We feel it in the market. We see it. We talk to people, and there is that feeling of ReRAM is going to be it. It's not going to be PCM. It's not going to be MRAM. We know it's going to be ReRAM, but someone else should make that first step.
There's this concept that people use in semiconductors called silicon proven, which is basically we want to see millions of products in mass production using this technology to really feel that it's good. Yes, it's qualified. Yes, it's nice. You showed us all of these things, and it's great, but we want to see more. We're slowly pushing this forward. We're overcoming this.
At the end of the day, what happens is normally that someone who's number two or number three or whatever, and they just want to leap forward and take over, they're looking at me saying, "Well, the chances of actually taking market share of growing with this new technology are greater than this perceived risk that we have, and we're just going to do it."
And that's really where we are today. We're pushing them forward to just see, "Hey, we've proven to you so many times. We've showed you qualification at SkyWater. We showed you qualification with the Leti chips. Basically, Leti chips are on STMicro wafers. We showed you that we know how to manufacture on 22-nanometer GlobalFoundries wafers. We're already now in the process of qualifying at 150 degrees." That's real robustness. 150 degrees means that you're good for practically anything.
And here in Australia, I can tell you guys, I had a surprise email from a company manufacturing drills for mining. That's what's relevant here, right? And guess what? Those drills reach very high temperatures, and they want RAM. So everyone, it's out there. And we're seeing the demand. We're seeing the need, and we will overcome it. So when we talked about what are the plans, and I realized that over this past year, we didn't have news, and people are starting to doubt what's happening.
And I keep telling them, "Yeah, it's coming. It's coming. We're working." And you guys are so sick and tired of me saying that, and I understand everyone. I agreed to just tie off my equity compensation next year to these milestones so that you see that I really mean it. We are going to get agreements done.
We are going to move forward, and I still stand behind my commitment. It's not just up to me, but I believe that we will manage to close that first deal before the end of this year. I don't have a lot of time, and we're really working hard on finalizing it. Next year, there are going to be other deals, and we're working on it. It's happening. It's just overcoming that human nature of hesitance.
That's basically the key message. I've had people ask me to give more examples of the use of ReRAM and why people want ReRAM and what are the first markets. I don't have actually slides on that, but I'm good at waving my hands, right? As I was joking with Eric, people tell me, "You want to shut Coby up?
You just hold his hands." But a few things just to help you understand where we stand in the sense of different applications. Dadi already mentioned the fact that we are what's called rad-hard, immune to radiation. And this definitely is very important for the space application. Actually, not just space, airplanes. Airplanes get enough radiation as it is already, and you don't want issues with that.
So ReRAM is a very good solution for space, for what's called LEO, low Earth orbit, and so on. But for Weebit, when we started talking about ReRAM, we were actually, I think I was surprised. The team may be a little bit less. I was actually surprised how many power management companies suddenly called us. I didn't expect power management to be the first application that really gets excited about it. But guess what? Power management today is a big thing.
And in our industry, it's really a very hot topic because today, devices don't just connect to the wall by a simple cord. You always have that box on it, okay? And that box is smart power management. That box has a controller that basically doesn't just feed the electricity, and it controls it. In order to lengthen the battery time, the battery life, it starts off by charging slower and then charges faster, and then towards the end, it charges slower, etc., etc.
You want to have smart power management, you need to have a microcontroller. You want to have a microcontroller, you have to have non-volatile memory. So now these guys, by the way, they don't go down to 22 nanometer or whatever. They're at 90 nanometer, 65 nanometer, 130 nanometer. So they can use flash. But flash is a front-end-of-line technology. It sits next to the design.
Now, power management is an analog circuit, and when you put flash next to it, it interferes. You cannot actually have your optimal power management when you have flash sitting next to it, and these guys were going crazy. What they had to do is have a two-chip solution. They had a chip with a power management and a chip with the MCU, with the microcontroller.
Now, that's expensive. That requires a board that is bigger for two chips. You want that box to be as small as possible, right, and sometimes the box is on the plug itself that you plug into the wall. You don't want it to be something big that covers half the wall and stuff, so RAM is an amazing solution for them. RAM is a back-end-of-line solution. It comes on top. It doesn't interfere with the circuit.
These guys are really excited about it. When you see that we are the first big deal that we did with DB HiTek, it's 130 BCD. You see BCD, you know it's power management. It's kind of that's the ideal technology for power management. So that's what basically drove. I mean, the 130 BCD from DB HiTek is good for many applications, not just power management, but you can see that that was the focus of DB HiTek.
If you look at other applications, in many other applications in the automotive field, of course, the fact that we can deal with high temperatures, that's the big deal. We are engaged now with automotive companies, the medical companies, and there are quite a few that are very interested in RAM.
Let's face it, these guys normally need to deal with 37 degrees, 41 degrees before the person dies of too high temperatures. They don't need the 150 degrees. What they do need is low power consumption and low leakage because guess what? A lot of these things are implanted in your body, and they don't want to do operations every two years to replace it just because the battery dies, so they want low power consumption.
They want devices that they can implant in your body and after 15 years have to replace them or whatever, and so that's where they get excited about RAM. You talk about, let's see, what other applications I can think of. In every application, you have that impact. I mean, IoT, again, low power is really important.
In general, all of these devices that are out there now that work on batteries and just spread all over the place, you want long battery life. So the low power consumption is important. You have, by the way, logging machines. Today, so many applications, they need even your water meter, your electricity meter, your whatever. They just want to log things over time, and they need better endurance. That's what's important for them. flash doesn't have.
Now, they want it to be on a non-volatile memory because even if there's power outage, they don't want to lose the history of the log that they're keeping of your usage or whatever. So for them, it's very important to have non-volatile memory. RAM has much longer endurance. Actually, with them, we're working already on even extending the endurance. And we have projects about making this even better. So that's an application.
And then there's, well, AI, of course. Everyone always asks me about AI. Actually, we have a slide about AI. Can you flip through the slides? I'll stop you when we get there. Keep going. No, keep going. I'll tell you when to stop. Keep going. Keep going. Let's go more. One more. This one. No, no, no. Keep going. Keep going. Keep going. It's one or two slides further, I think.
Keep going. Yeah, this one. So I already presented it last month, but if anyone missed it and maybe trying to explain it a little bit more. AI, of course, today, everyone's excited about it. And I think it's quite obvious that in the next five, 10 years, this is going to be a technology that just really takes over. AI has two main parts. There's the learning part where you teach it to do something.
Then there's the inference part where you use that knowledge to actually deal with whatever. Best example right now is you teach it to recognize the face of a terrorist. You show it a million pictures of that terrorist from different angles. It learns how to recognize it. And then you want cameras in the airport to see if that guy is walking by or down the street or whatever. So that's called inference. So learning or training, and then there's the inference. Now, of course, the learning part, you need to do in huge data centers. You need huge compute power and whatever.
But the inference part, where in the beginning, everyone thought all of it was going to be done on the big data centers. People realized that in many cases, you're talking about devices like these cameras that are out there, that if you want to stream everything that they see to the data center, you need very high bandwidth of the connection. You need power. I mean, it's constantly working and sending a lot of stuff. And some of these cameras, you want to be on batteries or whatever.
It just doesn't make any sense. So there's a shift now to do inference at the edge. And if you look at what happens now, in this case, they do like to go to 22 nanometer and below. And what solution do they have? Well, flash, you can't embed it. So you want to have those AI coefficients somewhere.
You want to have that AI engine, which is in an advanced technology. What happens is, again, you have a two-chip solution. You have, like you see on the left side there, you have the chip that's actually going to be doing the work. When you turn the system on, the coefficients are taken from the flash, loaded into the SRAM, and then you can work. But okay, it's a two-chip solution.
You have a security issue, by the way, because now people can eavesdrop on that connection. You can't really turn off that camera. I mean, if at a certain point, nobody's walking down the street, you want to turn off that camera. Don't waste battery, but an SRAM is volatile. You can't really do that. So you're kind of stuck. Now, SRAM, by the way, is also the bits of SRAM are big.
These are six transistors or even eight transistors. And so the number of coefficients that you can load into it is smaller. Now, today, and we have quite a few requests from multiple companies and research institutes that are telling us, "We want to move inference to use ReRAM." Okay. Now, if we replace the SRAM with ReRAM, we have the non-volatility in the chip.
So it's a one-chip solution. We can actually make a smaller device, a smaller board, whatever. So we save cost of two chips. And by the way, one of the things that I realized not many people understand, in the chip, the packaging sometimes costs even more than the chip itself. You save two chips, you save the second package, which is quite expensive. Now, the ReRAM cells, our technology, I mentioned it here and there, it's a 1T1R.
It's one transistor for every resistor that we have. It's a bigger transistor, like you know, but it still is not six or eight. You can actually have more coefficients on the same piece of silicon. You can run fast with our RAM, low power, and if you want, you turn it off. It's non-volatile. So whenever you don't want the device to work, you turn it off. So this is already a big step forward from what they have with flash.
And that's what, again, we have the requests for this from so many people. And the next step, what I talked about, I don't talk about enough, but moving to neuromorphic, where people actually use the RAM combined with that AI engine. And that's still a few years away, but we're already working with research institutes. So I think that I'm going to stop here because the rest of the stuff, you all know, and I'll be repeating things that I've said in the past, but I will open this up for questions now.
Oh, okay. Sorry. I would like to open the floor to any general questions from shareholders to the board. I remind you, the procedures are all on the outline about the questions before. Any final questions or comments from those on the phone who want to ask Coby or myself on anything other than the presentation or the resolutions or anything in general on the web.
We have some general questions online, but I'll open it to the floor first if there's any shareholders in the room. Okay. Yes.
I know the philosophy that you guys started off with was to go with second tier or third tier foundries, and you did one and moved on to tier one. Doesn't that philosophy still stand that you'll have less pushback or whatever if we would have stayed with tier two? And should we still be looking at those foundries as well? So what happened is we started off with SkyWater intentionally, like you said.
We wanted to start off with someone small. If we fail, it's a small failure and not a big failure and whatever. We proved ourselves at SkyWater. That enabled us to basically go to DB HiTek. DB HiTek, once they saw the qualification at SkyWater, that's what really triggered them to engage. DB HiTek now is triggering the others to move forward.
We're at the point now where the technology is really in a good state, showing good results. And I'm feeling confident enough to talk to the big guys as well as smaller guys. We didn't stop talking to the smaller guys. And we are engaged with a lot of foundries, some of them, a lot of the big ones, the biggest names, and some of them are small and moving forward. So I think the answer is we're strong that we can deal with anyone today. And we are talking to a wide range of foundries. Foundries slash IDMs, by the way. I say foundries, but it's always.
Okay. Any other questions in the room? So anything on the phone?
So yeah, we have.
So we have four questions from shareholders online. I'll start from a question from Mr. Larry Dorfman. General question about future revenue. The company often shares data illustrating the upside potential of the ReRAM market and speculates in its growth. Larry Dorfman. Okay. Sorry. Can you repeat the question? Yes. So this is a general question about future revenue. The company often shares data illustrating the upside potential of ReRAM market in dollar terms and speculates on its growth.
While I understand there are limits to what directors can share regarding future performance, there seems to be a way to provide shareholders with an idea of the potential revenue path. Are we talking in millions, tens of millions, or more? I don't expect detail and timeline, but one can speculate, for instance, could the company outline scenarios when capturing X percentage of the embedded ReRAM market might translate into an estimated dollar amount?
This would offer a more grounded perspective, especially as the directors frequently reference billion-dollar companies, which can in itself be misleading without additional context. Would you consider providing shareholders with such guidance?
So we've been still at the stage where things are not stable enough and predictable enough to start giving formal guidance. What I will say is, first of all, you saw that in June, we reported $1 million of revenue. And that's basically from one contract roughly, or we only have two contracts. You can speculate how much comes from which one. Now, I will just comment, and I won't go into too much detail, but just to give you a feel, in general, revenue of a project is recognized over the time of the project.
The DB HiTek project is not over yet, so you can understand that the $1 million is basically partial revenue on that project. I'm not going to say what the total number is and everything, but you can understand it's partial revenue, and you can start speculating on that. I will also comment something that is very, you don't need to be a rocket scientist to figure out that the first deals that you do are always the ones where you need to be more flexible, etc.
When we move forward now and we're working with larger companies, when we're working now that we have more history, we can be much stronger in the negotiation, and we can demand what we actually deserve. And so the deal sizes will definitely be growing as well. And beyond that, I don't think I can talk.
But if you think about the progression, the numbers could be mentioned. You look at the past, you try to use it as a way to see the future when we have more deals that may be some smaller, some larger, but we have a few. And the real ramp and the real number comes up when we get royalties, when products are out. This is a few years out.
Talking about numbers, I think it's going to be misleading. I don't know of any public company that talks about anything beyond the quarter on what exactly the revenue. If you take the CEO of NVIDIA, if someone asked him a question five years ago, what would be his revenue from AI, even if he thought he knew, and he said what it is, I don't think he knew. It's a new market. It's our ability to anticipate.
We give you an order of magnitude. You can depict that it's going to grow in a significant manner by a number of more deals, and when the royalty kicks in and starts getting the volume from all these products that Coby talked about, it's going to take some years. This is not going to happen tomorrow or next year, so I think you can understand that this is not potentially a small business.
I'll give you a reference point. There's a company that does similar or the much lesser technology than we are, called eMemory. They are Taiwanese. They do sell a very simple not sell. They sell IP. IP, the licensing. Today, this is a $100 million a year company, and their valuation is about $7 billion. Will we be larger or smaller than the other one?
I think it's a good representation of what are the opportunities in this market. I'm not going to give any guidance where we will be and how we will do this one. But the only thing I'll say, this is a way simpler, less capable technology that we are talking about, but there's a huge market for this kind of things. I'll leave it as this one as an example. There are other people with much larger businesses on IP. I will not mention that. You may try to read on your own on the web.
But just to finish what Dadi said, eMemory is a good example because they are exactly in our space. They license memory. They don't have products or anything else. They just license memory, very, very simple memories.
You can see, by the way, from the numbers that Dadi gave, which are US dollars, the multiplier. Our business is practically 100%. I mean, there's a 100% margin. You don't have expenses, really. So the multipliers are much higher than what people are used to thinking. And I think that's something that you should also consider. Other semiconductor IP companies also have these very large multipliers. So not only is the revenue potential big, but then the multipliers are very big.
Thank you. Our next question comes from Benny Berkowitz. Naomi Simson has been noticeably absent in shareholder presentations and is not a shareholder. Please comment on her input as a director.
What do you mean absent? She's here.
I'm happy to speak to that if you'd like. Sure. Go ahead.
I will say before she speaks that she is contributing very much in the board meetings and in the board discussions and so on. And I'm very happy that she joined us. So I think she's a great contribution to the board, but I will let you answer
. I'll do it. I will just stop you before you start talking. The camera is zoomed in on the lectern only. So those online can only see you if you speak from there. I do apologize.
Yeah. You can see that she really is here.
I think one of the most important things in scaling up with an enterprise like this is one, to bring experience. Secondly, to bring governance. And I know that my fellow directors see that contribution. One of the things that we also must be aware of as directors is true independence.
So the only reason I haven't paid any level of investment in this organization is for true independence. So I'm more than happy to consider something that is not material as long as shareholders still maintain that I am independent. It is important for all of you that you have directors who will challenge on your behalf. I represent you in that boardroom and your expectations.
It is also why I'm a layperson. I'm not an engineer. I'm not a scientist. I'm the sort of person who just asks the commercial questions. And also, as the company secretary knows, I'm the one who is always on the governance. I must keep you safe, and I must keep this board safe as well as the enterprise. So more than happy to make a contribution as long as shareholders don't then bail me up next year and say, "I'm no longer independent."
Thank you. I would like to make the comment that for us, for Dadi and for me, the fact that in Australia, somehow people think that if the directors own equity, then it makes them not independent, I cannot understand the logic.
I think it's exactly the opposite. I think the fact that directors have equity means that they have the same interest as the shareholders and that they are following and looking after shareholder interests. But I know that there was a question here about the big institutional proxy advisors and so on. For some very strange reason in my mind, they consider that as non-independence and stuff.
So we got our legal advice, and I think we are doing well with independence. But I don't have any complaints whatsoever on Naomi's contribution and others and being able to challenge us on all kinds of issues. That's exactly why we have a board and why we have board members with different expertise coming in and asking questions and making recommendations and making sure that we are challenged.
And at the end of the day, we are measured on what we said in the beginning is what kind of decision we have made at the end. And this is the way we measure us, and we have to have the best people. Any other question? Go ahead.
We have two more questions, both from Mr. Stephen Mayne. The first is, I don't understand why you can't offer your retail shareholders an SPP at any price. Please get on with it early in the new year as we have been diluted as a class by the big end of town investors who took up the recent AUD 50 million placement.
So first of all, I think everyone in this room knows I have a very strong commitment to our retail shareholders who have been with us and helped us. And I don't forget people who help me when it's the more difficult times. So in all of the recent raises, I've insisted, and I made it a condition for the brokers that we have to do an SPP or an entitlement offer. And George is here to tell you guys.
When they came and said they want to do the raise, I said, "An SPP is a must." And all of the documents and everything was set up to be with an SPP until 7:30 A.M. when the lawyer calls us up and says, "Hey, guys, I'm sorry to tell you, it's against ASX regulation. You cannot do an SPP if the price is above the 30-day VWAP. And we can't do an SPP."
And I spent an hour with the lawyer looking for entitlement offer, SPP, this trick, that trick. We just couldn't find a way to make this work. So I really am apologizing. I really tried. I continue my commitment to always think about our retail shareholders that have been supporting us through the tough times. And I really regret we just didn't find a way to make it happen. And I just apologize. I can't do anything beyond that.
Exactly.
Our final question today is also from Mr. Stephen Mayne. When disclosing the outcome of voting on all resolutions today, could you please advise the ASX how many shareholders voted for and against each item, similar to what happens with a scheme of arrangement? This will provide a better gauge of retail shareholder sentiment on all resolutions and insight into the chronically low retail shareholder participation rate.
Others have already blazed the trail as this was a voluntary disclosure initiative adopted by the likes of Qantas, ASX, Suncorp, Tabcorp, and Computershare during the current AGM season. You've got the data, so why not let the sun shine in?
Go ahead. Do you want me to address that?
So we're in full compliance with the Corporations Act and the ASX listing rules. And we will be releasing the results to the ASX after, as we are required to do. And we will consider that for next year. But we're in complete compliance with the Corporations Act and that is to close.
Is this request beyond the compliance?
Yes. He's asking us to release it before the AGM starts.
Oh, before the AGM. Oh, okay. Yeah. Okay.
We don't need to. We don't need to, but we'll think about it for next year. Yeah. Okay. Thank you. And just to be clear, the results will be announced, including the proxy results, will be announced after we get the poll results. After the meeting.
And by the way, I mean, I do agree, and I want to urge everyone because I know the retail holders normally get the notice of meeting and throw it to the trash. I mean, I know that even Dadi and I do that, right? I mean, that's the natural.
Not on Weebit. Not on Weebit, but on in general holdings, I know that's the natural thing. I do try to reach out to some of the holders, the retail holders, the larger ones, and ask them to participate. I sometimes ask people to even put it on HotCopper , please remind the shareholders to vote. I definitely ask you guys next year. I'll be very glad. The more people vote, the better.
Okay. Thank you. Are there any further questions? No further questions. Okay. There are no further questions. Oh, yeah. Are there any phone questions? Oh, phone questions. Okay. Any phone questions?
There's no phone questions.
Okay. If there are no further questions, that concludes the formal items of business to be considered at today's meeting. I declare the poll is now closed. As it will take some time for the poll results to be known, they will be announced to the ASX later today. I thank you for your attendance and declare the meeting closed. Thank you v ery much.