Chun-Hsien Tsai

About Chun-Hsien Tsai

Chun-Hsien (Eddy) Tsai, age 55, has served as Ainos, Inc.’s Chairman, President, and Chief Executive Officer since April 15, 2021; he also briefly served as CFO from April–August 2021. He holds an EMBA from National Yang Ming Chiao Tung University and concurrently chairs Taiwan Carbon Nano Technology Corporation (TCNT), directs Ainos Inc. (Cayman), and serves as Director/CEO of AI Nose Corporation . During his tenure, Ainos has remained pre-revenue stage with modest product sales; 2024 net loss was approximately $14.9 million and cumulative TSR proxy series shows a $100 investment at 2021 YE would be valued at 394 (2021), 76 (2022), 84 (2023), and 96 (2024), reflecting significant volatility and drawdown since 2021 highs . 2024 revenues were de minimis ($20,321 pet supplements; $408 COVID test kits), underscoring ongoing development-stage risk .

Past Roles

External Roles

Fixed Compensation

• CEO cash compensation structure (local currency): Monthly salary NT$250,000 (≈$7,800), increased to NT$479,810 (≈$15,000) effective Sep 1, 2024; year-end bonus equal to two months’ salary; additional variable compensation 10–100% of total annual compensation, payable in cash/securities at Compensation Committee discretion .

Notes:

• CEO Summary Compensation Table totals: $1,285,023 (2023) and $301,522 (2024), reflecting large equity grant in 2023 and smaller 2024 grant .

Performance Compensation

• Equity awards: CEO received RSUs under 2021 and 2023 Stock Incentive Plans and “special stock awards;” 2024 disclosure notes 4,000 shares of special stock awards as President & CEO . As of Dec 31, 2024, the company reports no outstanding shares underlying equity incentive plan awards for NEOs (suggests prior awards vested/forfeited or were not outstanding at year-end) .
• Plan performance linkage: Company states it “does not currently use financial performance measures” to determine “compensation actually paid,” relying instead on non-financial milestones (clinical progress, timelines, commercialization progress) .

Pay vs. performance (CEO “Compensation Actually Paid”):

• 2024: $20,669; 2023: $987,417; 2022: $777,962, driven by equity valuation changes and vesting; TSR series aligns with equity value fluctuations .

Equity Ownership & Alignment

Control/voting context (governance signal):

• Significant voting agreements concentrate control via Ainos KY (Cayman), ASE Test, and TCNT; Ainos KY’s voting agreements aggregate substantial voting power. Tsai and a family group are parties to voting agreements; he is a director of Ainos KY but does not control its board .

Employment Terms

• Compensation components: base salary (NT$), year-end bonus (2 months), variable pay 10–100% of total annual compensation (cash/securities) per Compensation Committee .
• Equity plans: 2021 Stock Incentive Plan governs RSUs, options, SARs; 2023 SIP used for 2024 grants; separate “special stock awards” also utilized .
• Change-in-control (CIC) equity treatment (2021 Plan): If awards are not assumed/substituted, time-based awards vest in full at CIC; if assumed, unvested time-based awards vest upon “Qualifying Termination” within 12 months post-CIC (double-trigger). Performance-award treatment per award agreement; Committee may cash-out vested portion at CIC; unvested/options at/below price may be canceled without payment .
• Clawback/detrimental activity: Awards subject to clawback to comply with company policy and applicable laws (e.g., SEC Rule 10D-1); detrimental activity can trigger cancellation/recoupment .
• Indemnification: Company provides director/officer indemnification and maintains D&O insurance .
• Severance (cash) and non-compete: No CEO-specific severance multiples or non-compete terms disclosed in proxy; plan-level “Detrimental Activity” and insider policy restrictions apply .

Board Governance

• Roles: Tsai serves as Chairman and CEO (combined roles). Board has seven members; three are independent (Chang, Chiang, Wei) per SEC/Nasdaq rules .
• Committees:
  • Audit: Chang, Chiang, Wei (Chair). All independent; all deemed “audit committee financial experts” .
  • Compensation: Chang (Chair), Wei; both independent .
• Independence and dual-role implications: CEO+Chair structure with only three independent directors and multiple insiders (including family members) on the board elevates governance and independence concerns, especially given extensive related-party activity with TCNT and voting control arrangements .
• Director election support (Nov 7, 2025): Tsai received 98.38% “For” votes; other directors >98% “For” .
• Hedging policy: Prohibits hedging and short-selling by insiders; no stock ownership policy (potential alignment gap) .

Director Compensation (Tsai as Executive Director)

• Tsai’s director compensation is included in NEO compensation; non-employee director policy provides RSUs (appointment grant) vesting in three equal semi-annual annualized tranches and annual retainers; see NEDCP for details .

Related Party Transactions (Risk Indicators)

• Patent License Agreement (Aug 6, 2024): Exclusive, irrevocable, perpetual license from TCNT in exchange for 5.5 million Ainos shares at 1.05× the highest 30-trading-day closing price pre-effective date; TCNT controlled majority voting power post-issuance via Ainos KY and direct ownership .
• Product Development Agreements with TCNT: Multiple addenda in 2024; non-exclusive patent use fees of $95,000/month (Jan–Sep 2024) and exclusive patent use at $50,000/month for 12 months from Oct 16, 2024; total $1,005,000 (+5% tax) paid in 2024 .
• Working Capital Note with Ainos KY: $800,000 note (1.85%); remaining principal $270,000 repaid Oct 7, 2024 .
• Convertible Notes & Warrants (May 3, 2024): $9,000,000 6% notes and warrants for 500,000 shares at $4.50 to ASE; convertible into common stock; maturity three years .
• Governance: Audit Committee oversees related-party transactions; Compensation Committee handles compensation matters .

Company Performance Snapshot (during Tsai’s tenure)

Qualitative progress:

• 3Q25 update: First patented commercial AI Nose device launched; six industrial partnerships; 2026 scale-up targeted; expanding “SmellTech-as-a-Service” with deployments across factories and robots; Asia-Pacific focus with U.S. as next growth frontier .

Investment Implications

• Pay-for-performance alignment: The company explicitly does not use financial performance metrics for NEO “compensation actually paid”; 2024 CEO cash bonus ($115k) was paid amid continuing operating losses. Heavy reliance on discretionary and non-financial milestones weakens direct financial alignment; however, equity value sensitivity is evidenced in CAP adjustments linked to stock movement .
• Vesting/selling pressure: As of Dec 31, 2024, no outstanding NEO equity awards were reported, suggesting limited immediate technical selling pressure from vesting. That said, “special stock awards” granted outside the 2023 plan and shareholder approval for up to 950,000 additional special stock awards (approved Nov 7, 2025) introduce potential future supply/dilution and award cadence risk .
• Ownership and control risk: Voting agreements across Ainos KY/TCNT and large stock issuances to TCNT confer practical control; Tsai’s parallel leadership at TCNT and Board chair role at AIMD elevate related-party and minority-protection risks. Audit/Compensation committees are independent, but board independence is constrained by executive/family directors and dual CEO-Chair structure .
• Policy safeguards: Hedging is prohibited and clawback provisions exist under the equity plan, which are positives. However, absence of a stock ownership policy reduces long-term ownership discipline for executives/directors .
• Change-in-control economics: Equity acceleration is effectively double-trigger when awards are assumed (single-trigger if not assumed), a market-standard provision that can facilitate retention through transactions while still representing potential cost to shareholders in a sale scenario .
• Capital structure/dilution: 2024–2025 related-party licensing (5.5M shares), convertible notes/warrants (500k at $4.50), and newly authorized special stock awards add meaningful dilution vectors; monitor overhang and issuance pacing .
• Execution vs. promises: The 3Q25 update cites meaningful commercial milestones for AI Nose; however, revenues remain nascent and operating losses persist. Equity compensation and control dynamics should be weighed against tangible commercialization inflections (orders, deployments, regulatory approvals) before underwriting management-alignment upside .

Appendix: Additional Governance and Compensation Details

• Director election results (Nov 7, 2025): Tsai 98.38% For; other directors 98.33–99.80% For .
• Non-Employee Director Compensation Policy (NEDCP): Appointment RSUs vest in three equal semi-annual tranches over ~18–30 months; annual cash retainers (Board members $12k; Chair $14k; Audit Chair $7k; Comp Chair $4.5k; Audit member $4k; Comp member $3k) .

Data sources: Ainos DEF 14A (Oct 1, 2025) ; Ainos 10-K FY2024 (Mar 7, 2025) ; 8-K (Nov 13, 2025) for annual meeting results and 3Q25 press release .