partly paid shares, page-94

I was at the AGM (always a pleasant social experience regardless of the emotional effect of the meeting itself).
I was kind of "looking forward" to the pp shares debate (in the sense of "anticipating" the watching of a train wreck about to happen) and it was all over rather quickly (considering it has been described as "dominating the AGM"). It certainly left a bit of a cloud over the whole thing given that it was left to the end of the meeting.
Management had prepared their strategy, which was a mixture of appeasement "we'll be happy to get together and chat about this AFTER the meeting", and minimalistic fulfilment of their obligation to answer the questions - Nick's contemptuous reading of the questions and prepared answers was quite a performance, and was more about style than content, given that they then refused to give Wilcox a written version of the lightning fast, albeit clearly articulated, response. In hindsight, I wonder if management wished they had handled what was initially a fair and reasonable shareholder enquiry differently? Wilcox has not been treated well overall, but I hope that he can now step back (job done) and not take this personally and make it a personal vendetta - indications are that he can, and if so, well done and plaudits to you Wilcox.

I think I now know what is going on (or at least have a theory that fits with all the known facts, statements, respones, and "non-responses"). I gave a synopsis to Rick during the post-meeting nibblies and drinkies, and he said that it seemed to make sense. Without giving air to all of my conclusions, here are some of my thoughts:

a) the share scheme is clearly dodgy - not in its set up but in its execution and maintenance.
b) This has not been because of mismanagement per se, rather it has been a case of convenient "neglect"
c) This scenario must be common amongst small companies who have spent decades on the brink of financial doom, seeking to give some recompense to the many who have "helped" on the way, without actually paying money (which they didn't have).

We are told that there are "about 30" recipients of these "partly paid" (some "not paid at all") shares, and the company wishes not to disclose who they are and how many shares and when they were given out (and why) and what the exact conditions were. Given my theory, that is fully understandable and I can't say that I am upset about it.

Mr Cuthbertson announced that ("according to their legal advice") the only way to sort this out was at an EGM (to be held "sometime in 2014" - I will put my house on it not being before at least July). Actually, of course it COULD have been done in the AGM too, but that utterly defeats the purpose of the whole thing, and I wonder about the absolute need for an EGM (but I know nothing of such things, it was just a thought)
This plan, however, is a good one - it acknowledges the need for change and getting things sorted (well done Wilcox!), but it allows time time for the sp to go up which will make the whole problem go away, as then many of the disputed pp shares will be exercised (before the EGM which will obliged to cancel many of them) and no longer be a problem!

I am not entirely clear on Wilcox's motivation for his dogged pursuit of the issue but I hope he just lets it go now as he has achieved his (presumed) purpose of making management accountable and it will now be fixed (later in 2014) and IF the sp goes up (IF the bloody Plant actually operates and works) then everyone will be happy.
In a perfect world, this should not have happened and the scheme perhaps should have not been used in the way it has been, but I can't blame the directors for trying it.

I would lay the main blame in the hands of the auditors who have signed off on this year after year, until it finally had to be brought to light in this way. They are NOT allowed to be creative in this way nor are they allowed to overlook management doing it, without strong objection (or refusal to pass it). They have not done their job (perhaps in order to not potentially lose a long-standing client?)

Overall this whole thing is SMALL compared to the obvious main game of getting to commercialisation. If it had remained unnoticed then NO HARM would have come - if the company failed, no money is lost or owed. If APG succeed, the other shareholders are not materially affected and various people are finally "rewarded" for their input in hard times.

A fascinating side show but let's move on - as long as their actually IS an EGM (before the next AGM), that will be enough, and there is no doubt a new scheme will be put in to replace this one!

Just give us a Plant and some contracts

sasa