18 July 2017
POET focuses on proprietary Dielectric Hybrid Platform to accelerate revenue growth
At its annual general meeting of shareholders (AGM), POET Technologies Inc of San Jose, CA, USA — which has developed the proprietary planar optoelectronic technology (POET) platform for monolithic fabrication of integrated III-V-based electronic and optical devices on a single semiconductor wafer — has provided a review of its strategy, technology roadmap and product development activities.
POET’s strategy is based on photonics integration (utilizing both monolithic and hybrid approaches) to lower cost and increase performance of disruptive solutions for the data communications and sensing markets, while focusing on the highest return on investment (ROI) opportunities available to the firm.
POET reckons that recent explosive growth in the market for indium phosphide (InP)-based solutions for datacoms at 100Gbps utilizing wavelength-division multiplexing (WDM) provides an opportunity for it to leverage its InP facility and production capability in Singapore, its proprietary dielectric technology, and its wafer-level packaging expertise into a new Hybrid Dielectric Photonics platform strategy.
POET has demonstrated the functionality of its proprietary dielectric waveguides for multiplexing and de-multiplexing light signals, allowing for the development of an optical engine suitable for transceivers operating at 100Gbps. Engineering samples of these devices should be delivered to customers this quarter.
POET is strategically allocating resources to capitalize on the rapidly growing InP photonics market (which is forecasted to grow to an $11bn addressable market by 2021) in order to increase ROI, accelerate time to revenue, and deliver shareholder value.
Technical challenges related to the manufacturability of the monolithic gallium arsenide (GaAs) platform have delayed POET’s development of a GaAs-based optical engine. The additional development time and cost associated with the GaAs platform will require the firm to secure a strategic partner in order to develop and commercialize this platform.
POET also announced that its Narrow Linewidth Laser products have demonstrated what it claims is industry-leading performance with ‘super-wide’ tunability for high-resolution sensing applications such as gas & chemical sensing, coherent communication, meteorological sensing and atmospheric LIDAR. Additional developments (including the incorporation of dielectric waveguides and wafer-level packaging) are expected to accelerate growth in the sensing product line in 2018 and beyond.
At the AGM, the existing directors were re-elected as proposed (with each director receiving over 88% of the votes cast), and certified public accountants Marcum LLP of New Haven, Connecticut were reappointed as auditors for the coming year.
In an effort to reduce cash expenses, and following a review of peer group companies, the board of directors recently reduced the cash compensation paid to its executive chairman, and (effective 1 April) eliminated per-meeting fees and reduced the annual cash retainer paid to directors.
In the recent past, the demands on the board to address key strategic and operating challenges resulted in frequent and numerous meetings, with per-meeting fees representing a substantial portion of total director compensation.
In the newly adopted program, the executive chairman is paid US$200,000 annually, the annual cash retainer for each director is reduced to US$30,000, and each committee chairperson receives an additional annual retainer of US$10,000. The balance of director compensation is paid in stock options worth US$90,000 annually, plus US$10,000 per year of options to each committee chairperson.
At the meeting of the board following the AGM, as part of the incentive stock option grant program, options were granted to certain directors, officers and employees to purchase up to a total of 9,225,000 common shares (about 3.55% of the outstanding shares of the company), comprising 2,225,000 for employees, 4,000,000 for management, and 3,000,000 for directors.
The options are exercisable for 10 years at a price of CAD$0.28 (US$0.22), i.e. the closing price of the shares on 12 July. The directors’ options vest quarterly in arrears over the one year of service as a director until the next AGM. All other options granted to employees and management vest 25% on the first anniversary of the grant and the balance vests quarterly over a further three-year period thereafter. The grant to the directors represents the option portion of directors’ fees for the 15-month period from 1 April (when the cash fees were reduced) through the next AGM.
The options were granted subject to provisions of the company’s stock option plan and are subject to the TSX Venture Exchange policies and applicable securities laws.