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(Sharecast News) - Seed Innovations announced on Tuesday that it has appointed Hoid.ai as a specialist investment consultant to support its updated strategy focused on high-growth robotics and artificial intelligence ventures, in a move that constituted a related party transaction under the AIM rules.
The AIM-traded investment company said Hoid.ai was established by its chairman and largest shareholder Jim Mellon and is led by Robert 'Bob' MacDonald, a venture and growth capital investor with experience across Asian markets.
MacDonald and his team would reportedly work with the board to identify and assess investment opportunities aligned with Seed's new investing policy, while all final investment decisions will remain with the company.
The consulting agreement has an initial term running to 31 March 2031, with a 12-month notice period thereafter, and may be terminated immediately if Mellon ceases to be a director or his shareholding falls below 10%.
Hoid.ai would be reimbursed for reasonable expenses capped at 20,000 per month in the first year and would also be entitled to a performance-related fee equal to 15% of any increase in audited net asset value per share above a 4% hurdle rate.
Any such fee would be split equally between cash and Seed shares or warrants, priced by reference to a 30-day volume-weighted average price and subject to lock-in provisions of up to three years.
"Bob and his team bring a rare combination of investment discipline and a proven track record of identifying breakthrough opportunities at an early stage," said Jim Mellon, non-executive chairman of Seed Innovations.
"His experience in emerging technologies and strong network in the venture ecosystem make him exceptionally well suited to support Seed's new strategy.
"We are very pleased to have secured his involvement and look forward to working closely with him as we build a focused portfolio in robotics and associated AI."
Seed said the appointment was a related party transaction because Hoid.ai is wholly owned by an entity controlled by Mellon, who holds around 22.2% of the company, and because two Seed directors are also directors of Hoid.ai.
It said its independent directors, after consulting with nominated adviser Beaumont Cornish, concluded that the terms of the agreement were fair and reasonable for shareholders.
At 1527 GMT, shares in Seed Innovations were flat at 2.75p.
Reporting by Josh White for Sharecast.com.