Here’s how the voting went down at the Kogan (ASX:KGN) AGM

The Ltd (ASX:KGN) share price is dropping lower on the day of its annual general meeting. Here’s what happened…
The post Here’s how the voting went down at the Kogan (ASX:KGN) AGM appeared first on Motley Fool Australia. –

agm causing asx share price rise represented by letter blocks spelling agm on top of coin piles

The Ltd (ASX: KGN) share price has come under pressure on the day of its annual general meeting (AGM).

In afternoon trade the ecommerce company’s shares are down over 3% to $17.72.

How did the voting go at the AGM?

As readers might be aware, there was a lot of controversy over Kogan’s AGM this year due to its plan to issue options to its Chief Executive Officer, Ruslan Kogan, and its Chief Financial Officer, David Shafer.

The Kogan board was wanting to grant 3.6 million share options to Mr Kogan and a further 2.4 million share options to Mr Shafer. These retention options, as they have called them, have been proposed as an incentive for the two executives to stay with the company for the next three years.

They will be exercisable for $5.29 per share in three years if the executives remain with the company.

This means for ~$19 million and ~$12.7 million, respectively, the two directors can convert these options into shares worth ~$93.7 million and ~$42.5 million, respectively, at today’s market price.

This plan did not go down well with many investors and particularly proxy advisors, who urged shareholders to vote against the issuing of these options at its AGM.

Though, for extra controversy, the Kogan board suggested it would just buy the shares on-market in the future and gift them to the executives if shareholders voted against their issue at the AGM.

But that won’t need to the case, because today Kogan shareholders narrowly voted in favour of the issue of these options.

According to the release, 56.35% of votes were in favour of granting options to Mr Kogan and 56.3% of votes were in favour of granting options to Mr Shafer.

Remuneration report receives a first strike.

Proxy advisers may not have been able to block the options from being granted, but they delivered Kogan a first strike for its remuneration report.

A total of 43.74% votes were against the report according to the release (compared to the 25% required for a strike). This means that if Kogan receives a second strike next year, the Kogan board could be voted out of office.

The company’s Chairman, Greg Ridder, was perplexed by the strike. Prior to the vote, he commented: “Based on Proxies received to-date, the vote on adopting the Remuneration Report is also interesting.”

“For a company that delivered strong returns in FY20; was right at the top of performance relative to peers and ASX200 companies; did not pay any LTI to Executive Directors; and had Executive Directors with their pay at the bottom of the peer set (many of whom didn’t generate positive shareholder returns), it was perplexing to see proxy advisers recommend a vote AGAINST the adoption of the Remuneration Report, and for many super funds to follow the proxy advisers’ recommendations.”

“While the Remuneration Report is retrospective, it appears many of the votes received are prospective and we will receive a “strike”, albeit that – based on Proxies – it does seem that a majority of Shareholders are in favour of adopting the report,” he added.

Where to invest $1,000 right now

When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for more than eight years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

Scott just revealed what he believes are the five best ASX stocks for investors to buy right now. These stocks are trading at dirt-cheap prices and Scott thinks they are great buys right now.

See The 5 Stocks

*Returns as of June 30th

More reading

James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of ltd. The Motley Fool Australia has recommended ltd. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The post Here’s how the voting went down at the Kogan (ASX:KGN) AGM appeared first on Motley Fool Australia.

Trade The World Anywhere & Anytime!

Mobile app platform with over 50,000 global listed securities across 12 markets (over 70% global market capitalisation), right from your Android or iOS device.

Integrated with exclusive trading idea and investment analysis tools to help you find actionable insight on virtually every financial instrument across our 12 global markets, to help you optimise your trading strategies.

Refer Your Friends

Tell your friends about Monex and gift them FREE access to our trading tools.

We respect your privacy and will only send this one email notification to your friends. 

Share With Your Friends

Share on facebook
Share on twitter
Share on linkedin

Monex Trading Tools Access and Usage Terms

The Monex Trading Tools (referred to as ‘tools’ hereafter) are available to you inside your client portal;

To activate access to the tools, you must have a verified and approved trading account and have made a deposit of at least AUD $1000.

An active and funded account with a positive trading balance is required to continue to have access to the tools;

Although the tools are available to you indefinitely, Monex Securities may at it’s discretion disable access to the tools in the future;

Monex securities reserves the right to change these terms and conditions from time to time, as it sees fit, without notice.

Important Notice
iOS & Android App - 12 International Markets & Over 70% Global Market Cap. $0 Brokerage On US Trades. Click Here!