Alizyme Share Discussion Threads

[mad mike] 21/6/2009 18:29

Chronicler, I think you may be a bit confused. You should know a company's annual report is usually released at, or around, the sametime time as the 'invitation' to the AGM. It is also not unusual for the AGM resolutions (& voting forms) to accompany the Annual Report.

So it was entirely proper for AZM's 2007 Annual Report, to explain why certain Directors were not to be put up for election at the AGM reviewing that period i.e. the AGM that took place in Jun'08.

Afterall, what would be the point of waiting almost a further year, as you are suggesting, to explain why a Director was not put up for election. The right time to explain, is at the relevant AGM, or (preferrably) beforehand (like in the Annual Report) i.e. exactly what Alizyme have done regarding the 'nine years' Corporate Governance code.

[You are QAZ, arn't you?
I recognised the strange, manipulative logic, inability to accept you have mislead others, continual claims that black is white, and inability to know when to stop digging. LOL!]

[chronicler] 21/6/2009 10:17

Thank mm.

The 2007 Annual Report retrospectivly covers the Fin Yr 2006/07 and seems to satisfy the Code requirements for that period..

The failure and reasons for WE not standing for re-election at the 2008 AGM should have been mentioned 2008 annual report for the period 2008/09 - but does not include any such statement. It should do imo.

There are also the matters of the payoff to DCampbell mentioned by loafofbread and the 16.6% pay rise to TimMcC seemingly to offset the loss of the performance bonus.

[mad mike] 21/6/2009 04:02

Chronicler, since you have clearly studied, in detail, the Corporate Governance section in at least one Alizyme Annual Report, then you will know that Alizyme DOES explain the reasons why certain sections of the 'Corporate Governance Code - 2006) are not adhered to e.g. the nine year rule. So it comes across that you are being less than straightforward in criticizing Alizyme.

There is much to criticize Alizyme's Board, without the need for you to make misleading claims about Alizyme's adherence to the Corporate Governance Code.
[ You wouldn't be QAZ, would you? LOL!]

[Of course, criticizing the Board about, any over 70s rule, or about Executive renumeration, are entirely different, and valid, matters to raise]

FYI, the 2007 Annual Report, preceded the last AGM, so is the relevant Annual Report to study to understand why certain Directors, having already served for 9 years, did not put themselves up for election at the last AGM, as required by the Corporate Governance Code - 2006'.

The relevant two paragraphs of the 2007 Annual Report (pg45) state:-

"Statement of application of the principles of good
governance and compliance with the Combined Code
Having reviewed the Combined Code, the Directors believe that
the Company and the Group have complied throughout the year
with the principles of the Combined Code, except for provision
A.7.2 of the Combined Code as explained below. In accordance
with the requirements of the Combined Code, as set out in
Section 1 of the Combined Code, an explanation as to how the
principles of the Combined Code have been applied and
explanations for non-compliance with those principles are set
out below and, .........."

The Board
........................
"Sir Brian Richards, Chairman, John Gordon and William Edge
each have served for more than nine years on the Board as Non-
Executive Directors since their first election and, as such, should
be subject to annual re-election under provision A.7.2 of the
Combined Code. However, it is Alizyme's view that Sir Brian
Richards, who has considerable knowledge and experience in
the biopharmaceutical industry, John Gordon, who is a qualified
chartered accountant and has a background in corporate
finance, and William Edge, who has extensive experience in both
the pharmaceutical industry and the investment community, are
valuable members of the Board and are independent in character
and judgment. Furthermore, Alizyme recognises the value of
continuity in the context of the long-term nature of the business
and accordingly considers that it is inappropriate for Sir Brian
Richards, John Gordon and William Edge to offer themselves for
annual re-election on account of this requirement. Alizyme
recognises the need for new independent Non-Executive
Directors on the Board and is currently engaged in a recruitment
process to source suitably qualified and experienced candidates"

[chronicler] 20/6/2009 14:54

this looks to be another worrying find (from the other thread). How can McCarthys 16.6% pay rise have been justified. It looks like a morally corrupt compensation for loosing his bonus. What is the point in having a bonus system if you are going to compensate someone when they loose their bonus. Again - like the William Edge issue - there is no explanation in the relevant Annual Report. Actions of the Remuneration Committee are supposed to be governed by the 2006 code!!!



Troutfish - 30 Apr'09 - 10:00 - 34 of 61

Hard to believe but inspite of the failure of Renzapride, and failure to deliver deals on Cetilistat (rest of world) and ATL-104, Tim McCarthy's salary package actually rose by £9k last year (from the Annual Report out today):

Tim McCarthy 2008 (and 2007)

Fees/Basic Salary (£): 350k (300k) - up 50k (16.6%)
Annual Cash Bonus (£): 0 (68k)
Other Benefits (£): 52k (35k) - up 17k (48%)
Pension (£): 70k (60k) - up 10k (16.6%)

Total (£): 472k (463k)

If you look closely you will see he has lost the Annual Cash Bonus of £68k but they offset this by increasing his Basic Salary by £50k (a 16.6% rise), Other Benefits by 17k (a rise of 48%) and Pension by £10k (a 16.6% rise).

So McCarthy feels no financial pain for not delivering and has actually been rewarded by another pay rise. Infact because they raised his Basic salary to offset the loss of the Annual Cash Bonus, it could also be argued they have removed the incentive for him to deliver. Even more amazing if you consider inflation has been at a record low level below 3% and certainly no where near the 16.6% increase in parts of his package.

[chronicler] 20/6/2009 14:39

mike

1. I have looked in the Corporate Governance section of the Annual Report 2008 (dated April 2009) and can find no disclosure, period or reasons info as to why William Edge should have put himself up for re-election as a Non Executive Director at the 2008 AGM but failed to do so, yet somehow continued in that position drawing a Non Exec salary of £45,000 until he resigned in April 2009.

All it says (page 28) is -

"On 1 April 2009 RL and RdeS were appointed as Non-Executive Directors and William Edge resigned as a Non-Executive Director".

This therefore looks to be a false statement if infact William Edge's Non-Executive Directorship (and salary) legally lapsed at the 2008 AGM (both on the 9 year rule and the age 70 rule) when he failed to put himself up for re-election.

I also consider the 2006 Code is more than just guidance, as it is referred to in the Annual Report as the "rules on corporate governance required for companies Listed on the Official List" - and if shareholders voted in favour of the Annual Report it was on the basis the Company would adhere to the rules in the Code as the Company itself said it would.

It is important because some shareholders might have wished to vote against WE's re-election particularly as it would have saved the company the £45,000 salary he subsequently drew until he "resigned" the following April.

You could also say if he was planning to "resign" in April 2009, not only should he have put himself up for re-election at the 2008 AGM (on the 9 year rule and age 70 rule) but he should also have disclosed that he planned to resign the following April and what benefit he expected to contribute in the intervening period - so shareholders could also have taken that into account in perhaps voting against his re-election - many might have questioned just how much benefit he would have contributed to the Company for staying the extra 9 or 10 months.

You cannot just have companies making and breaking the rules as they go along.

[dunderheed] 19/6/2009 21:05

Well that's one (question) for this agm then?!

[mad mike] 19/6/2009 21:01

Chronicle, I think you will find that Alizyme's Annual Report has conformed with the 'Corporate Governance code 2006'. Try looking in the Corporate Governance section of the Annual Reports (both current & past). You will see that the (current & past) Annual Reports explain why some non-Executive, despite having served for over nine years, were not put up for election each year.

The issue about Board members over 70, having to put themselves up for election each year, came from a shareholder(not me) at the last AGM. The shareholder's question was something like "as I recall, in the past, Alizyme's Articles of Association require Board Directors over 70 to put themselves up for election each year. Is that still the case".

The Chairman, who was already over 70, said something like "I put myself up for election each year for that reason". Then to the surprise of the Chairman, Willian Edge chips in that he is also over 70 (but hadn't put himself up for election last year). The discussion then pettered out, without a definitive conclusion, because, to be honest, there were more important matters to discuss at the time. However, shareholders were left with the clear impression (as I reported at the time) that William Edge should have put himself up for election, but didn't.

Maybe the Chairman, who was confused on other matters, mixed up the Code's 'nine years in situ' with 'over 70' in the Articles of Association. FYI, the Chairamn, & William Edge qualified on both counts.

If the 'over 70' rule is really in Alizyme's Articles of Association, the Board have no option but to adhere strictly to that Article. They can't just treat it as guidance as with the 'Corporate Governance code'. Also, I believe, they can't change any of the Articles of Association, without first getting shareholders approval at a General meeting i.e. AGM or EGM.

Unfortunately (and I'm surprised), Alizyme's Articles Of Association, can't be found on their web-site, unlike with other companies. So I can't definitive confirm the 'over 70s' rule one way or the other.

[mikey34] 19/6/2009 16:15

Is it really that important?I'm personally more concernred with landing some deals.

[chronicler] 19/6/2009 14:34

Schedule C of the Combined Code on Corporate Governance 2006 also says the Annual Report should disclose instances of non-compliance, the period and reasons. I can find no such info in the Annual report relating to the seeminly obvious issue that William Edge should have stood for re-election at the 2008 AGM before continuing to draw a non executive director salary of £45,000. this looks like another issue. If they continued to pay him as non-Executive Director after his position lapsed it should be disclosed in the annual Report.

To think this Co is presided over by a CEO paid almost $350k pa.




Schedule C: Disclosure of corporate governance arrangements

Paragraph 9.8.6 of the Listing Rules states that in the case of a listed company incorporated in the United Kingdom, the following items must be included in itsannual report and accounts:

�� a statement of how the listed company has applied the principles
set out in Section 1 of the Combined Code, in a manner that
would enable shareholders to evaluate how the principles have
been applied18;

�� a statement as to whether the listed company has complied throughout the accounting period with all relevant provisions set out in Section 1 of the Combined Code; or

�� not complied throughout the accounting period with all relevant provisions set out in Section 1 of the Combined Code and if so, setting out:

(i) those provisions, if any, it has not complied with;
(ii) in the case of provisions whose requirements are of a
continuing nature, the period within which, if any, it did not
comply with some or all of those provisions; and
(iii) the company's reasons for non-compliance.

[chronicler] 19/6/2009 14:33

Schedule C of the Combined Code on Corporate Governance 2006 also says the Annual Report should disclose instances of non-compliance, the period and reasons. I can find no such info in the Annual report relating to the seeminly obvious issue that William Edge should have stood for re-election at the 2008 AGM before continuing to draw a non executive director salary of £45,000. this looks like another issue. If they continued to pay him as non-Executive Director after his position lapsed it should be disclosed in the annual Report.





Schedule C: Disclosure of corporate governance arrangements

Paragraph 9.8.6 of the Listing Rules states that in the case of a listed company incorporated in the United Kingdom, the following items must be included in itsannual report and accounts:

�� a statement of how the listed company has applied the principles
set out in Section 1 of the Combined Code, in a manner that
would enable shareholders to evaluate how the principles have
been applied18;

�� a statement as to whether the listed company has complied throughout the accounting period with all relevant provisions set out in Section 1 of the Combined Code; or

�� not complied throughout the accounting period with all relevant provisions set out in Section 1 of the Combined Code and if so, setting out:

(i) those provisions, if any, it has not complied with;
(ii) in the case of provisions whose requirements are of a
continuing nature, the period within which, if any, it did not
comply with some or all of those provisions; and
(iii) the company's reasons for non-compliance.

[chronicler] 19/6/2009 13:17

The Annual Report details William Edge was paid £45,000 for the last Financial Year until he "retired on 1 april 2009" - for a position it seems he may not have been legally entitled to occupy after the 2008 AGM.

[chronicler] 19/6/2009 13:15

The Annual Report details William Edge was paid £45,000 for the last Financial Year until he "retired on 1 april 2009" - for a position it seems he may not have been legally entitled to occupy after the 2008 AGM.

[troutfish] 19/6/2009 12:03

Perhaps this money should be repaid to Alizyme, and those who both sanctioned and received the payments should be investigated - particularly if they knew they were breaking the rules.

[troutfish] 19/6/2009 11:53

Just noticed a couple of serious accusations on the old thread. The legal positions may warrrant investigation and reporting to the Cambridge Police. Based on what has been said, it looks like William Edge may not have been entitled to receive a Directors salary after the 2008 AGM or that Mr David Campbell may not have been entitled to compensation if he resigned (as officially reported).



mad mike post 23656 -

"For example, I recommend all shareholders to vote down the annual report (usually the first resolution), as it claims that William Edge resigned as a Director on April 1st this year, when his resignation should have taken effect at the close of last year's AGM.

According to the Chairman at the last year's AGM, Alizyme's Articles of Association state that all Board members over 70 must put themselves up for election at each year's AGM. At last year's AGM, William declared he was already over 70, and acknoweldged he should have put himself up for election. The fact that William failed to do so, must mean his Board Directorship lapsed at the end of the AGM.

What is the point of having articles of association if they are not kept to. Or do the Board feel that only those Article that don't apply to them have to be implemented!

Also, what is the legal postion of rest of the Board, knowingly continuing to pay a person as if they were a Board Director, when they knew the Directorship had lapsed. Is it misuse of company money?"



loafofbread - post 23658 -

"My first question will be if Mr Campbell resigned, why did he get £256K compensation.

(Considering he was on £139K before and he would be taking the 30% pay cut it would have been cheaper to keep him on for a further 2 years but with 2 years notice?)

Is it usual to get paid off if you willingly resign. Don't think so".

[chronicler] 19/6/2009 11:31

I agree the CEO looks overpaid and probably should go if it would save moneny and be replaced by a caretaker CEO on a minimum salary until Cetilistat 3 Japan reports.

For me the key is the need to be able to remain as a going concern until the Phase 3 Japanese results for Cetilistat are out in H2 2010 - the trial being scheduled to end in July 2010. If Alizyme can last as a going concern until then and cetilistat passes the trial, Alizyme will get a big milestone payment from Takeda and subsequent sales revenues, and the share price will recover dramatically.

[loafofbread] 19/6/2009 11:18

Fid,

Good point.

If he did 'resign'he would bust the company.

I see we are the only company not going to the Piper Jaffray Conference. We really are a bit of a laughing stock.

[troutfish] 19/6/2009 11:14

Not sure where we go now.

[mikey34] 19/6/2009 10:40

Ttoutfish,

Your antagonism about McCarthy's salary is understandable but the comparisons are inappropriate.Let me start by saying that I routinely vote against the packages of directors of building societies and always have...the CEO of Nationwide is on more than £1m for instance...but then the PM is on a relative pittance given the responsibility.I happen to think literally every CEO is too well looked after with options, bonuses etc,etc,but McCarthy is no more so than at most of smaller co's.If you want to offer a lot less you won't get much,which doesn't make it right but unfortunately that's the name of the game at present.
If he ever does deliver(and much of that is out of his control),that salary will seem less excessive.

Your point is valid as a generalization.