Wednesday, May 10, 2006

Rambus Inc. annual meeting

In a word - disappointing.

Rambus fresh from a $300 + million jury verdict, additional recent successful legal skirmishes across the country, a couple major license agreements in '06, PS3 on display at E3 and promised in time for the holiday season, more patents issued - seven in the last two weeks, a new CFO . . . and the buzz was the 2006 Equity Incentive Plan.

I was hoping for an upbeat, "rah, rah, we have made great strides this year and the future it bright" . . . I was disappointed.

CEO Harold Hughes was defensive of the proposed 2006 Equity Incentive Plan under which the Board has reserved 8,400,000 shares of Common Stock for issuance. He did not wait for the Q & A to opine. Unfortunately, Mr. Hughes was more passionate about this issue than any other. Reminded me of a coach who gets himself ejected from the game for protesting what he believed to be a bad call. I am hoping the players rally. Otherwise, Mr. Hughes only tarnished his image - disrespecting a Ramboid and all.

CFO, Satish Rishi, presented the numbers and adequately explained expensing of options and clearly expressed his belief that the expensing rule is inappropriate.

General Counsel, John Danforth, remains a bright light and removed some of the shadow from the 12 DOJ documents in the AT case . . . still waiting for Judge Kramer's order and then 20 days for the appeal. Rambus will post the order on its site. The documents in question are from Hynix and Micron and concern Samsung.

During the Q & A Mr. Hughes provided information about the IFX settlement. In short, Rambus will get $50M and then if Rambus signs two majors it will receive an additional $50M from IFX. If a third signs, an additional $50M. Once a plateau is reached without additional signing(s) to trigger additional payments, payments will cease and then may begin once the requisite signing occurs.

1 comment:

empiricum said...

A MESSAGE TO HAROLD HUGHES, Rambus CEO:

Outside the Board room, there is a very simple rule that governs human relationships, be it in government or private business:

*** A PERSON WHO HATES OR INCAPABLE OF DEALING WITH PEOPLE AND THEIR PROBLEMS SHOULD NOT OCCUPY EMPLOYMENT POSITIONS THAT REQUIRE CONTACT WITH CUSTOMERS OR THE PUBLIC. ***

Examples of such positions are customer service, personal or telephonic, bank tellers, and TSA employees, to mention a few. And those are the ordinary circumstances.

Your case, Mr. Hughes, is a special circumstance. You occupy a position of trust and has a FIDUCIARY RELATIONSHIP with your shareholders. You are the shareholders' go-between with their corporation.

What you did yesterday, as widely reported, in tactlessly telling a shareholder (STUART STEELE) to sell his shares in response to his question or criticism of your and fellow "executives" excessive option grants and their recurrent exercise, IS HIGHLY UNBECOMING AND A BETRAYAL OF YOUR POSITION OF TRUST !

By slamming and insulting Steele, you also slammed and insulted all of us who questioned the rationale of your excessive options.

WHEREORE, as it is perhaps your "combative nature" not to issue any written apology, YOU SHOULD IMMEDIATELY RESIGN AND GET OUT OF RAMBUS COMPLETELY.

 
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