Ann: Appendix 3B with prospectus, page-34

"Who is JR Symonds?
And can anybody tell me what he does. What's the deal ?
Adviser to the board, is the board lacking.
I don't see this as bad management could be good. "


I somewhat typical MSB fashion, Friday's announcement raises more questions than it answers, in my mind. What has me scratching my head:

1. Why the need exists for an expensive consultant like JR Symonds, given the MSB board is purported to be so well credentialised (and well remunerated, too boot) and competent? [*]


2. The nature of the consulting arrangement, i.e., to provide "strategic advice to the CEO and the Board", sounds disconcertingly vague to me. What does that really mean, and why does a board of this size and scale need additional strategic advice? Isn't setting the strategy for the business what the current directors get paid to do? If that needs to be partly sub-contracted out, why does the existing board cost shareholders the better part of $4m?

3. Why is this consultant being paid as much as he is being paid (effectively, $2.2m over the three years)? You could get, not just a part-time consultant on retainer, but three additional full-time executive directors for that amount of money.

4. Why does the payment take the form of free, in-the-money options? Why is there no incentivisation hurdle involved?

5. And then, why does this JR Symonds consultancy arrangement form part of the same announcement about Kentgrove (and having read the prospectus a few times, I am still not sure whether this is de facto "activation" of the Kentgrove facility, or not)?

[*] I remember when Mr Bill Burns was appointed to the board, and subsequently elevated to the position of Vice Chairman, there was much approval on this forum along the lines of it being such a smart thing because Mr Burns was sure to be facilitating MSB's soon-to-be incoming partners. Self-evidently, if this was his brief, then MSB shareholders don't seem to be getting much bang for their $185,000 pa buck which goes Mr Burns' way each year. I wonder how MSB shareholders feel about Mr Burns last year managing to attend only 10 out of the 14 directors' meeting which he was required to attend.