Indeed, the 578,000 shares were issued to Shore under the Share Investment Plan.
The multiplicity of plans, their lack of transparency, and the failure to submit details of these for the approval of the shareholders (instead, relying on so-called shareholder approvals dating back to 2000) makes for quite a complicated story.
Note 30 explains Shore's details in terms of the following: 1) salary sacrifice; 2) shares bought using pre-tax dollars on a tax deferred basis; 3) any applicable tax is deferred for 10 years (max); 4) in Shore's instance, however, he cannot access the shares for 10 years, or until he leaves the Company, or until the Board relieves him of the restrictions on selling; 5) this was done on 7th August 2002.
Under most share plans, the best that an employee could ever do would be to receive $1,000 worth of shares under a tax exempt plan.
Here, however, Shore was awarded 578,000 shares through a form of salary sacrifice which, according to Page 7 of AR02, were worth $86,580 (or 15c per share).
If the 230,000 purchased on 6th August @29.74c amount to the same experience (ie: salary sacrifice, tax deferred, etc), then a further $69,000 was spent by the Company in acquiringg shares for the benefit of Shore.
In relation to 2002, however, Shore was appointed as Chairman on 30th July 2002, and: 1) received a disclosed salary (cash, plus shares) of $116,000 for 5 months work (annualised @$278,400); 2) was able to salary sacrifice $86,000 worth of shares on 7th August 2002 (ie: within one week of joining the Board); and 3) did this again on 6th August 2003.
Perhaps, his contractual arrangements involve an annual form of salary sacrifice in order to buy shares?
Perhaps, he has quite a flexible remuneration package.
But, all things considered, being able to buy $86,000 worth of shares out of pre-tax dollars before you have spent even a week in the job is no small token. And to double-up again in 2003 is also no mean feat.
The question, therefore, is whether Shore's actual Chairman's package is close to $278,000 per annum, or whether this is simply the inflated result of a highly advantageous share investment scheme?
And, this is before you consider the award of any options!!!
Not bad if you're the one on the gravy train. Pity, however, the long term shareholders.
