Micro-Mechanics (Holdings) Ltd. Extraordinary General Meeting (EGM) 2025 – Key Investor Update

Overview

Micro-Mechanics (Holdings) Ltd. held its Extraordinary General Meeting (EGM) on 30 October 2025. The meeting was attended by the Board of Directors, senior management, auditors, lawyers, share registrar, and independent scrutineers. The session addressed critical strategic decisions that may significantly impact shareholder value and the Company’s future direction.

Key Resolutions and Discussions

1. Proposed Share Buy-Back Mandate

• Share Buy-Back Plan: The Board proposed a mandate allowing the Company to repurchase up to 10% of its issued ordinary shares, either via market or off-market purchases. The buy-back price is capped at 105% of the average closing price for market purchases and 120% for off-market purchases.
• Shareholder Concerns: Investors raised questions about the impact of buy-backs on share liquidity, especially given perceived undervaluation of the shares. The Board assured shareholders that liquidity and timing will be carefully managed, with a focus on long-term value rather than short-term market fluctuations.
• Price Sensitivity: The adoption of a buy-back mandate could signal management confidence in the share’s intrinsic value and may support the share price, particularly if executed during periods of undervaluation.

2. Micro-Mechanics Performance Share Plan 2025 (PSP 2025)

• New Share Incentive Plan: The PSP 2025 introduces equity-based awards to replace part of cash bonuses, aiming to strengthen employee ownership, engagement, and retention. Awards under the plan may comprise up to 15% of the issued share capital.
• Performance Metrics: Awards are tied to business performance metrics to align employee incentives with the Company’s long-term strategic goals.
• Industry Benchmarking: The plan is designed to attract and retain talent in the competitive semiconductor industry, following best practices observed among leading peers.
• Price Sensitivity: The plan’s introduction, especially after a long hiatus, could be viewed positively by the market as a signal of the Company’s commitment to rewarding and retaining high-performing talent, which is crucial for innovation and operational excellence.

3. Participation of CEO and Controlling Shareholder in PSP 2025

• CEO Involvement: Mr Kyle Christopher Borch, the CEO and controlling shareholder, is eligible to participate in the PSP 2025. This raised questions about alignment and governance, which the Chairman addressed by emphasizing the importance of aligning key employees’ interests with those of shareholders, subject to stringent performance metrics.
• Shareholder Safeguards: Mr Borch and his associates abstained from voting on related resolutions to ensure transparency and fairness.
• Price Sensitivity: The CEO’s participation and potential award may be viewed as a vote of confidence in the Company’s prospects, but also necessitates close monitoring of governance and performance outcomes.

4. Proposed Grant of Up to 100,000 Shares to CEO Under PSP 2025

• Award Structure: Mr Borch is proposed to receive up to 100,000 shares, with half vesting at the end of the first half-year of FY2026 and the remainder at the end of the second half-year. These shares are subject to a one-year moratorium from each vesting date, during which they cannot be sold or transferred without committee approval.
• Price Sensitivity: The award structure aligns executive rewards with Company performance and imposes a retention period, potentially reinforcing management’s commitment to long-term value creation.

5. Dividend Policy Discussion

• Shareholder Suggestion: There was a proposal to consider increasing dividends as an alternative to buy-backs for rewarding shareholders and improving share valuation. Management will review and recommend strategies to the Board.
• Price Sensitivity: Future changes to dividend policy could materially affect investor returns and share price.

Poll Voting Results

• All four resolutions were overwhelmingly approved, with votes for each ranging from approximately 89.5% to 99.95%.
• Resolution Breakdown:
  • Share Buy-Back Mandate: 99.95% approval
  • Adoption of PSP 2025: 97.81% approval
  • CEO Participation in PSP 2025: 89.57% approval
  • Grant of Up to 100,000 Shares to CEO: 89.52% approval

What Investors Should Watch

• Execution of Share Buy-Backs: Watch for timing, scale, and price of buy-backs, which may support share prices if executed strategically.
• Impact of PSP 2025: Monitor for increased employee retention, improved performance, and potential dilution if full awards are granted.
• Dividend Policy Changes: Future Board decisions on dividends may directly impact shareholder returns and market valuation.
• CEO’s Award and Performance Metrics: Closely follow disclosures on performance conditions for the CEO’s share award and subsequent vesting.
• Governance Practices: The abstention of interested parties in voting signals strong governance, which may positively influence investor confidence.

Conclusion

The EGM featured several strategic decisions likely to impact Micro-Mechanics’ share price, including the introduction of a buy-back mandate, revamped performance share plan, and high-profile equity awards. Investors should closely monitor the implementation and outcomes of these resolutions, as well as any changes to dividend policy, for potential price-sensitive developments.

Disclaimer: This report is for informational purposes only and does not constitute investment advice. Investors should conduct their own due diligence and consult professional advisors before making investment decisions. The actual impact of resolutions and strategies adopted may vary depending on market conditions and Company performance.

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