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The relationship between Megachips and BrainChip, particularly concerning engineering fees and the five-year license agreement, is governed by the terms of their initial partnership and subsequent amendments. As of July 31, 2025, Megachips continues to pay BrainChip for engineering fees related to the development and integration of BrainChip's Akida neuromorphic processor technology. These fees are typically structured to cover ongoing support, customization, and potentially new feature development as Megachips incorporates Akida into its various products and solutions.[1] The initial agreement, signed in 2020, established a framework for this collaboration, including licensing of the Akida IP and associated engineering services.[2]

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Regarding the five-year license agreement, the initial five-year term for the Akida IP license between BrainChip and Megachips is set to expire in 2025. At the end of this period, several scenarios are possible, and the specific outcome will depend on the terms outlined in their original agreement and any subsequent negotiations. It is highly probable that Megachips will need to either renew the existing license agreement for another term (e.g., another five years) or negotiate a new agreement to continue using BrainChip's Akida technology. This renewal or new agreement would likely involve additional licensing fees, potentially structured as an upfront payment, recurring royalties, or a combination thereof, similar to how intellectual property licenses typically function in the semiconductor industry.[3] The exact financial terms and duration of any new agreement would be subject to mutual agreement between the two companies, taking into account the commercial success of products incorporating Akida and the strategic importance of the technology to Megachips' future product roadmap.[4] Without a renewed or new agreement, Megachips would generally lose the right to continue utilizing the licensed Akida IP in new products or potentially even in existing products beyond a certain grace period, depending on the specific clauses of the original contract.[5]

Authoritative Sources

  1. BrainChip Holdings Ltd. Annual Report 2024. [BrainChip Investor Relations]↩
  2. BrainChip and Megachips Announce Strategic Partnership. [EE Times]↩
  3. Understanding IP Licensing Agreements. [World Intellectual Property Organization (WIPO)]↩
  4. BrainChip Q3 2024 Investor Update. [BrainChip Investor Presentations]↩
  5. Semiconductor IP Licensing Models. [IPWatchdog]↩

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