RE:Vote.....
BTDS is spot on with his post, and this is the once in a year event where shareholders have a voice. This AGM is very important for all shareholders who need to be heard through their votes.
IMO, the Corporate Managers and several Directors are unqualified, tend to use Kelso as their personal ATM machine, and their job performance is never tied to stock price appreciation. And there is zero interaction with the professional investment community which means there is little interest and little trading volume from new investors.
The 10% rolling stock option plan is supposed to incentivize qualified Directors and reward them for their performance. Presently Directors and Officers are automatically awarded Options annually, and also to any new Director. This program definitely needs to end. With real companies, Directors are expected to purchase shares with their own money so they have skin in the game. The only one who has done this is Jesse Crews. The new Director, Frank, received 200k shares and hasn’t bought one since!
And, Management’s overly generous compensation package is due for renewal this year. They make a ridiculous amount of base salary money and bonuses are tied to profits only with no connection to stock price performance. For several Officers, per their Management agreement, this is considered ‘part-time’ work while also being Directors or Management for other failing companies. With Peter Hughes chairing the compensation committee, imo, their package will only get better.
The Auditing firm, Smythe LLP, has had a long and too close a relationship with Kelso. Their fees increase annually with little extra work performed. Also Rick Lee’s son is an employee of Smythe LLP. There is conflict of interest and this should change.
Alignment with shareholder values needs to start with changes to the Board of Directors. Any Director receiving less than 50% of total votes needs to resign immediately. The caveat is that Kelso needs three Directors to have a valid board. If all Directors receive less than 50% approval the Board gets to choose who gets to stay; you know it will be Rik, Tony and Jesse. For that reason, I’m voting for Jesse, Frank and Laura. .
On a final note, shareholders should know that highly qualified Director Candidates have been presented to the board but none have been approved. These include senior leaders who have vast experience in international rail, automotive, automotive/truck suspension systems, heavy manufacturing and trucking.
Since there is little experience at Kelso to bring the suspension system to market, revenue will fall on rail revenue which is likely to be impacted by Covid19, for the foreseeable future. Expecting indigenous tribes to buy suspension systems in this environment is unrealistic.
In summary, I voted Withhold on Rik, Tony, Peter, and Paul. Also voted against the 10% Rolling stock option plan and against renewal of the auditing firm, Smythe LLP. The goal is to make changes which will improve and grow the company and shift performance/pay requirements closer to shareholder values and which positively impact the stock price long term.