Join today and have your say! It’s FREE!

Become a member today, It's free!

We will not release or resell your information to third parties without your permission.
Please Try Again
{{ error }}
By providing my email, I consent to receiving investment related electronic messages from Stockhouse.

or

Sign In

Please Try Again
{{ error }}
Password Hint : {{passwordHint}}
Forgot Password?

or

Please Try Again {{ error }}

Send my password

SUCCESS
An email was sent with password retrieval instructions. Please go to the link in the email message to retrieve your password.

Become a member today, It's free!

We will not release or resell your information to third parties without your permission.

Bullboard - Stock Discussion Forum Lignol Energy Corporation V.LEC

TSXV:LEC - Post Discussion

Lignol Energy Corporation > $895k in Annual Management Salary...
View:
Post by 2guys on Oct 06, 2011 6:13pm

$895k in Annual Management Salary...

This company is "top heavy" if you ask me.

The only other place I see such waste is in the governement, but unlike the government, LEC can't raise their debt ceiling.

C'mon, how can they justify such salaries when they only have enough money to last another 5 months? 

So what have they done to deserve their pay?  They came out with a news release stating that High Performance Lignin can be used to produce thermoplastics. 

Wow, that's kind of like saying that Lignin can be produced from biomass isn't it?  Seriously, where is this company going to be in 6 months?  

Looks like they are ready to protect their salaries in the case their positions are terminated.  At least we can rest assured that they won't be going home empty handed if LEC is no longer a going concern.  I'm feeling better already.


From the Management Information Circular:


Termination of Employment, Change in Responsibilities and Employment Contracts

Other than as described below, the Company has no contracts, agreements, plans or arrangements that provide for

payments to an NEO at, following or in connection with any termination (whether voluntary, involuntary or

constructive), resignation, retirement, change of control or change in an NEO’s responsibilities.

Ross MacLachlan – President, Chief Executive Officer and Chairman of the Board

The Company entered into an employment agreement with Ross MacLachlan on January 15, 2007, which provides that

Mr. MacLachlan will serve as Chairman and President of the Company, with a base salary of $15,000 per month,

subject to statutory and other required deductions, paid semi-monthly, and a performance bonus of up to 60% of his

base salary. Mr. MacLachlan may also be granted such stock options under the Plan as may be approved by the Board

of Directors from time to time. Effective July 1, 2007, the Company increased Mr. MacLachlan’s monthly base salary

to $20,833 per month. Effective May 1, 2009, the Company increased Mr. MacLachlan’s salary to $21,458 per month.

Effective May 1, 2010, the Company decreased Mr. MacLachlan’s salary by 10% to $19,312 per month.

Provided the Company continues to be a going concern or, in the discretion of the Board acting reasonably, the

Company has or will have sufficient funds to continue its operations in a manner consistent with the Company’s

operations for the previous twelve months, if the Company terminates Mr. MacLachlan’s employment without just

cause, he will be entitled to severance equal to eight months’ base salary and related bonus plus an additional one

month’s pay per completed year of service up to a maximum of twelve months’ base salary plus bonus in total or the

equivalent base salary in lieu of notice or any combination of notice and pay in lieu thereof. If such a scenario took

place on May 1, 2011, Mr. MacLachlan would be entitled to receive a severance of $231,744 plus any applicable bonus

of up to a maximum of $139,046

Should the Company no longer be a going concern, and, in the discretion of the Board acting reasonably, the Company

does not have or will not have sufficient funds to continue its operations in a manner materially consistent with the

Company’s operations for the previous twelve months, the Company may terminate his employment at any time

without cause by the provision of written notice and the payment of all accrued pay to the date of termination, including

accrued vacation pay and a maximum severance of eight weeks’ base salary plus bonus in total, or the equivalent base

salary in lieu of notice, or any combination thereof. If such a scenario took place on May 1, 2011, Mr. MacLachlan

would be entitled to receive a severance of $35,653 plus any applicable bonus of up to a maximum of $21,392.

In the event Mr. MacLachlan’s employment is terminated without cause at the time of or within 12 months of the date

of a change of control of the Company, Mr. MacLachlan will be entitled to payment of any amounts or benefits,

including deferred pay accrued to the date of termination and payment of the higher of either (i) double the base salary

and related bonuses which Mr. MacLachlan would otherwise be entitled to receive at that time if his position was

- 12 -

terminated without cause under a scenario where there was not a change of control; or (ii) 12 months’ base salary plus

bonus. If such a scenario took place on May 1, 2011, Mr. MacLachlan would be entitled to receive a severance of

$741,580.

David Turner – Executive Vice President, Chief Financial Officer and Corporate Secretary

The Company entered into an employment agreement with David Turner on January 15, 2007, which agreement

provides that Mr. Turner will serve as Executive Vice President and Chief Financial Officer of the Company, with a

base salary of $14,500 per month, subject to statutory and other required deductions, paid semi-monthly, and a

performance bonus of up to 50% of his base salary. Mr. Turner may also be granted such stock options under the Plan

as may be approved by the Board of Directors from time to time. Effective July 1, 2007, the Company increased Mr.

Turner’s monthly base salary to $16,667 per month and effective July 16, 2008, the Company subsequently increased

Mr. Turner’s monthly base salary to $17,500 per month. With the appointment of Mr. Charpentier as the Company’s

Chief Financial Officer effective July 16, 2008, Mr. Turner no longer served the Company in that capacity but

continued in his role of Executive Vice President. Effective May 1, 2009, the Company increased Mr. Turner’s salary to

$17,850 per month. Effective May 1, 2010, the Company decreased Mr. Turner’s salary by 9% to $16,243 per month

and reduced his performance bonus to up to 40% of his base salary. Effective May 21, 2010, Mr. Turner resumed the

role of Chief Financial Officer.

Provided the Company continues to be a going concern or, in the discretion of the Board acting reasonably, the

Company has or will have sufficient funds to continue its operations in a manner consistent with the Company’s

operations for the previous twelve months, if the Company terminates Mr. Turner’s employment without just cause, he

will be entitled to severance equal to eight months’ base salary and related bonus plus an additional one month’s pay per

completed year of service up to a maximum of twelve months’ base salary plus bonus in total or the equivalent base

salary in lieu of notice or any combination of notice and pay in lieu thereof. If such a scenario took place on May 1,

2011, Mr. Turner would be entitled to receive a severance of $194,916 plus any applicable bonus of up to a maximum

of $77,966.

Should the Company no longer be a going concern, and, in the discretion of the Board acting reasonably, the Company

does not have or will not have sufficient funds to continue its operations in a manner materially consistent with the

Company’s operations for the previous twelve months, the Company may terminate Mr. Turner’s employment at any

time without cause by the provision of written notice and the payment of all accrued pay to the date of termination,

including accrued vacation pay and a maximum severance of eight weeks’ notice and related bonus, or the equivalent

base salary in lieu of notice, or any combination thereof. If such a scenario took place on May 1, 2011, Mr. Turner

would be entitled to receive a severance of $29,987 plus any applicable bonus of up to a maximum of $11,995.

In the event Mr. Turner’s employment is terminated without cause at the time of or within 12 months of the date of a

change of control of the Company, Mr. Turner will be entitled to payment of any amounts or benefits, including

deferred pay accrued to the date of termination and payment of the higher of either (i) double the base salary and related

bonuses which Mr. Turner would otherwise be entitled to receive at that time if his position was terminated without

cause under a scenario where there was not a change of control; or (ii) 12 months’ base salary plus bonus. If such a

scenario took place on May 1, 2011, Mr. Turner would be entitled to receive a severance of $545,764.

Michael Rushton – Chief Operating Officer

Lignol Innovations Ltd., a wholly-owned subsidiary of the Company, entered into an employment agreement with

Michael Rushton on January 18, 2007, which agreement provides that Mr. Rushton will serve as Chief Operating

Officer, with a base salary of $14,000 per month, subject to statutory and other required deductions, paid semi-monthly,

and a performance bonus of up to 30% of his base salary. Mr. Rushton may also be granted such stock options under

the Plan as may be approved by the Board of Directors from time to time. Effective July 1, 2007, the Company

increased Mr. Rushton’s monthly base salary to $15,000 per month and effective July 16, 2008 the Company

subsequently increased Mr. Rushton’s monthly base salary to $16,667 per month. Effective May 1, 2009, the Company

increased Mr. Rushton’s salary to $17,333 per month. Effective May 1, 2010, the Company decreased Mr. Rushton’s

salary by 6% to $16,293 per month. Effective September 1, 2007, Mr. Rushton’s performance bonus was increased to

40% of his base salary.

Provided the Company continues to be a going concern or, in the discretion of the Board acting reasonably, the

Company has or will have sufficient funds to continue its operations in a manner consistent with the Company’s

operations for the previous twelve months, if the Company terminates Mr. Rushton’s employment without just cause, he

will be entitled to a severance equal to six months’ base salary and related bonus plus an additional one month’s pay per

- 13 -

completed year of service up to a maximum of twelve months’ base salary plus bonus in total, or the equivalent base

salary in lieu of notice or any combination of notice and pay in lieu thereof. If such a scenario took place on May 1,

2011, Mr. Rushton would be entitled to receive a severance of $162,930 plus any applicable bonus of up to a maximum

of $65,172.

Should the Company no longer be a going concern, and, in the discretion of the Board acting reasonably, the Company

does not have or will not have sufficient funds to continue its operations in a manner materially consistent with the

Company’s operations for the previous twelve months, the Company may terminate Mr. Rushton’s employment at any

time without cause by the provision of written notice and the payment of all accrued pay to the date of termination,

including accrued vacation pay and a maximum severance of eight weeks’ base salary and related bonus, or the

equivalent base salary in lieu of notice, or any combination thereof. If such a scenario took place on May 1, 2011, Mr.

Rushton would be entitled to receive a severance of $30,079 and any applicable bonus of up to a maximum of $12,032.

Dr. Colin South – Chief Technology Officer

Lignol Innovations Inc., a wholly-owned subsidiary of the Company, entered into an employment agreement with Dr.

South effective November 8, 2010, which agreement provided that Dr. South will serve as Chief Technology Officer of

the Company, with a base salary of US$23,750 per month, subject to statutory and other required deductions, paid semimonthly,

and a performance bonus of up to 60% of his base salary. Dr. South may also be granted such stock options

under the Plan as may be approved by the Board of Directors from time to time. Effective May 1, 2011, Dr. South

accepted a decrease in his base salary of 15% to U$20,188 per month.

Provided the Company continues to be a going concern or, in the discretion of the Board acting reasonably, the

Company has or will have sufficient funds to continue its operations in a manner consistent with the Company’s

operations for the previous twelve months, if the Company terminates Dr. South’s employment without just cause, he

will be entitled to a severance equal to three months’ base salary and related bonus plus an additional one month’s pay

per completed year of service up to a maximum of twelve months’ base salary plus bonus in total, or the equivalent base

salary in lieu of notice or any combination of notice and pay in lieu thereof. If such a scenario took place on May 1,

2011, Dr. South would be entitled to receive a severance of US$60,564 plus any applicable bonus up to a maximum of

US$36,338.

Should the Company no longer be a going concern, and, in the discretion of the Board acting reasonably, the Company

does not have or will not have sufficient funds to continue its operations in a manner materially consistent with the

Company’s operations for the previous twelve months, the Company may terminate Dr. South employment at any time

without cause by the provision of written notice and the payment of all accrued pay to the date of termination, including

accrued vacation pay and a maximum severance of two weeks’ notice and related bonus, or the equivalent base salary in

lieu of notice, or any combination thereof. If such a scenario took place on May 1, 2011, Dr. South would be entitled to

receive a severance of US$9,318 plus any applicable bonus, up to a maximum of US$5,591.

In the event Dr. South’s employment is terminated without cause at the time of or within 12 months of the date of a

change of control of the Company, Dr. South will be entitled to payment of any amounts or benefits, including deferred

pay accrued to the date of termination and 1.5 times the base salary and related bonuses which Dr. South would

otherwise be entitled to receive at that time if his position was terminated without cause under a scenario where there

was not a change of control. If such a scenario took place on May 1, 2011, Dr. South would be entitled to receive a

severance of US$145,353.

Dr. E. Kendall Pye – Chief Scientific Officer

Lignol Innovations Inc., a wholly-owned subsidiary of the Company, entered into an employment agreement with E.

Kendall Pye effective March 1, 2008, which agreement provides that Dr. Pye will serve as Chief Scientific Officer, with

a base salary of US$12,000 per month, subject to statutory and other required deductions, paid semi-monthly, and a

performance bonus of up to 30% of his base salary. Effective May 1, 2009, the Company increased Dr. Pye’s salary to

US$12,240 per month. Effective May 1, 2010, the Company decreased Dr. Pye’s salary by 10% to $11,016 per month

and provided Dr. Pye eleven months working notice and notice that his employment agreement would be replaced by a

professional services consulting agreement. Under the terms of his consulting agreement, Dr. Pye’s compensation is

determined on a per diem basis, with a maximum amount chargeable to the Company of U$12,000 per month. The

Company may terminate the consulting agreement with Dr. Pye without cause, by providing one month’s prior notice.

Comment by SlumdogMillionaire on Oct 06, 2011 10:04pm
I agree 100%. I would like to see more of their compensation tied to stock performance (ie: options/stock incentives) instead of just straight cash.
Comment by chalkmarks on Oct 07, 2011 9:51am
Well, I disagree 100%.Lignol is not one of Howe Street's "concept" companies, in which the technology involved is "to be developed". Lignol has advanced the engineering sufficiently that the management team in place already could well see the project through to production. These is not a squad of boiler room scoundrels, but an engineering team.This $895k team is actually a ...more  
Comment by 2guys on Oct 07, 2011 10:19am
Never said they were a "squad of boiler room scoundrels", just that LEC is "top heavy" and they haven't proven themselves commercially yet, and with only 5 months left of funds, most of it is going to their back bottoms and not the bottom line.How's about these well paid "assets", put a few thousand dollars together and buy some LEC shares on the open market ...more  
Comment by TheRock07 on Oct 09, 2011 10:30am
Lyall had about 4.5 million shares so selling 500,000 is not a big deal.There are a thousand reasons why one might sell..............divorce, vacations, deaths, dispesrements etc.Their technology has reached the stage for its most advanced HP  derivatives that it is now seeking JV agreement to move to full commercial production.Thats what I invested here for, and now that such is happening ...more  
Comment by 2guys on Oct 11, 2011 8:08am
I wasn't concentrating solely on Lyall as he is most likely no longer considered an insider, and he was never a paid member of LEC's management.My point is that none of the well paid management team has supported the price, instead they have sold.What's Rushton's holdings compared to his annual salary?  Quite a telling tale IMO.As for the ellusive JV agreement......LEC has ...more  
Comment by M101 on Oct 12, 2011 2:29am
Lyall was clearly locking profits, don't we all wish we had. The Rushton sale looks like tax loss selling, not that that's any excuse. I don't think management should be making any effort to support the price, if they get active on such a low volume stock they'll be manipulating it without trying and then we're all screwed.If the company ever gets any really good news it's ...more  
Comment by willpelly on Oct 12, 2011 8:56am
Hi folks - just thought I'd share an email I received from David Turner yesterday. I had sent him a little bit of a blast on the reasons why senior management isn't supporting the stock, and specifically raised the question of a number of larger investors, who I referred to by name. The email back doesnt say much, but might be interesting to some of you anyway. Here it is (copy-pasted ...more  
Comment by 2guys on Oct 12, 2011 10:48am
Thanks willpelly for sharing that email.  Personally, I sent 3 or 4 emails in the past, and not one got answered, but it's good to see they're either answering them now, or at least are answering some enquiries.Still top heavy, no matter who's selling.  There's been more than 40k sells by insiders by LEC's executive team in the past 5 years, but that's not ...more  
Comment by TheRock07 on Oct 27, 2011 8:29am
It is difficult to understand how they could seek a JV or Offtake agreement without hiring the services of a competent and aggressive IR firm so as to bring the share price inline with improved fundamentals.They need investor exposure in the worst kind of way.Liquidity is near nil.Come on...get off your duffs
Comment by SlumdogMillionaire on Oct 27, 2011 11:45am
Agreed. Market conditions will be improving, so all we need is some decent news and this baby will take off again.
The Market Update
{{currentVideo.title}} {{currentVideo.relativeTime}}
< Previous bulletin
Next bulletin >

At the Bell logo
A daily snapshot of everything
from market open to close.

{{currentVideo.companyName}}
{{currentVideo.intervieweeName}}{{currentVideo.intervieweeTitle}}
< Previous
Next >
Dealroom for high-potential pre-IPO opportunities