'Please don’t SHOUT in the THREAD TITLES. Because of acronyms they have to be edited manually, and moderators usually have enough to do without posters creating work for them. J.'
First, I'd like to apologise to our mods, as I simply cut'n'pasted the thread title direct from the announcement and had no idea it would create such chaos for mods. Maybe others aren't aware it creates chaos either, so I thought I'd share the feedback here.
Smac here's what OBJ's Remuneration Charter currently states:
'Remuneration Committee of the Board of Directors – Charter The Company’s Remuneration Committee comprises Mr Antonio (Tony) Varano (Chairman), Mr Jeffrey Edwards (Managing Director), Mr Steven Schapera (Non-Executive Director) and Mr John Palermo (Company Secretary).
The Remuneration Committee has a separate charter for its audit functions with the following responsibilities:
• to make decisions with respect to appropriate remuneration and incentive policies for executive directors and senior executives;
• to ensure that executive remuneration involves a balance between fixed and incentive pay, reflecting short and long term performance objectives appropriate to the Company’s circumstances and objectives;
• to ensure that fees paid to non-executive directors are within the aggregate amount approved by shareholders;
• to ensure that non-executive directors are not entitled to retirement benefits other than statutory superannuation entitlements or to participate in equity-based remuneration schemes without due consideration and appropriate disclosures to shareholders;
• to review and make recommendations concerning long-term incentive compensation plans; and
• to ensure that incentive plans are designed around appropriate and realistic performance targets.
The Remuneration Committee obtains independent advice on the appropriateness of remuneration packages.
In making decisions with respect to appropriate remuneration and incentive policies for executive Directors, the Remuneration Committee’s objectives are to:
• motivate executive Directors to pursue the long term growth and success of the Company within an appropriate control framework;
• demonstrate a clear correlation between key performance and remuneration; and
• align the interests of key leadership with the long-term interests of the Company’s shareholders.
Shareholder approval is also required to determine the maximum aggregate remuneration for nonexecutive Directors.
The maximum aggregate remuneration approved for non-executive Directors is currently set at $250,000 per annum.
Full disclosure of the Company’s remuneration philosophy and framework, and the remuneration received by Directors in the current period, is set out in the Remuneration Report, which is contained within the Directors’ Report.
The Remuneration Committee meets twice per year.'
http://www.obj.com.au/wp-content/uploads/2018/09/Remuneration-Committee-Charter.pdf
'That, for the purpose of Listing Rule 10.17, the Company’s Constitution and for all other purposes, the aggregate amount of fees that may be paid to non-executive Directors as a whole be increased from $250,000 to an aggregate of $400,000 per annum, effective from 1 July 2018.'
Currently their salary is split between $40K per annum and 6300 pounds each month as consultants fees, which collectively makes up the approx. AU$180K each.
The increase to AU$400K for Resolution 5, only defines the Directors 'per annum' fees and is completely seperate from their additional monthly 'consultancy fees'. In saying this, my % increase figures of 60% pay increase is incorrect, as I based it on the Director aggregate pool increasing from AU$250K to AU$400K. Effectively what they are asking for here is an increase of their 'per annum' Director fee from AU$40K to AU$75, which equates to an increase of almost 100%. The urgency to back-date this to 01/07/2018 is due to the fact that they want this effective for the 2019 financial year.
This equates to an effective increase of almost 100% in 'per annum' Non-Executive Director fees and possibly more if they split the remaining AU$75K among themselves based on workload: 'This resolution seeks Shareholder approval to increase the maximum fees payable to non-executive Directors in each financial year from $250,000 to $400,000 in aggregate, to be apportioned between them as determined by Board resolution, or in the absence of a resolution,
equally between them.' & 'The proposed increase to the non-executive Directors’ fee pool is sought to provide for the Board’s expansion and to allow for the Board to set fees in light of the future workload of non-executive Directors.'
(which strikes me as odd, considering their individual 'workload' is covered under their monthly 'Consultancy Fees' and completely seperate).
Here's the breakdown for the proposed 2019 financial year per annum Non-Executive Director Fees:
Tony Varano AU$100K
Chris Quirk AU$75K
Steve Schapera AU$75K
Cameron Reynolds AU$75K
That gives us a total of AU$325K out of a possible AU$400k, that will give them a buffer of AU$75K to either hire another Director or split the difference among themselves.
Personally, I'd be more concerned about the Consultancy fees, but at least these fees are independently and externally audited from time to time.
After all this, we are all left with almost the same question: Do Shareholders feel that an almost 100% increase in 'per annum' Directors fees are warranted in the same year that Shareholders have experienced 65%--- erosion of their core capital after a 50% decrease the previous year? At these decrease rates, pretty soon all our core capital will have disappeared.
It all seems pretty simple once you talk it out. As long as we are all happy with 'per annum' increase in Director Fees, the rest seems fair and reasonable to me. They do pretty much have us by the balls in more ways than one (apologies ladies for the crude analogy), but it is not all their fault; so it feels like another one of those times to throw caution to the wind and give them what they want and see if they can raise OBJ like a Phoenix. And as Smac has pointed out the '
with or without amendment' for Resolution 1 seems like just a lazy cut'n'paste from previous years.
Overall, I don't really have any issues with Resolution 5 and the pay increase, apart from the exact opposite direction OBJ's share-price has taken; which is understandable. It's a yes from me on all Resolutions, but I'm not sure if I can be bothered in attending the AGM this year. There is not really that much to talk about, otherwise they would have announced it already. Apart from maybe a look at a new device that will take ages to launch and show up in Revenue, it really feels like a complete waste of money attending. Shame really, as it's always fun to catch up with the Share-holder crew from years past.
(20min delay)