The ‘Bozo Bonus’ did not attract whole-hearted support from STMicroelectronics’ shareholders at their AGM last week.
Whereas six of the eight resolutions passed at the AGM received shareholder approval ranging from 96% to 99% of voters, there was a sharp drop in the approval for the other two ‘Bozo Bonus’ resolutions to an approval rating of 74.5% and 71%.
An ST employee and shareholder also pointed out that the voting forms were sent out late, effectively disenfranchising him.
“I would have liked to have voted,” he wrote, “but by a strange coincidence my notification and voting forms arrived two days after the AGM. The company must have made sure any employees did not get to have their say on their impressive CEO’s performance bonus. The voting results are now in and as expected the bonus was approved but with a 47% turn out (I wonder how many other voting forms were delayed) 75% approved compared to over 99% for all other items on the agenda.”
The results are on the ST investors page at (http://investors.st.com/phoenix.zhtml?c=111941&p=proxynew, and click on ‘2012 AGM Voting Results which are reproduced here:
(click the image to enlarge it)
There were two Bozo Bonus resolutions at the AGM.
One of the resolutions was to: ‘approve the delegation to our Supervisory Board of the power to grant Mr. C. Bozotti a special annual bonus of up to 60% of his base salary . . . . the Special Bonus is intended to provide an incentive to our President and CEO to increase his efforts for the success of us.’
The other one was to: ‘to approve the delegation to our Supervisory Board of the power to grant Mr. C. Bozotti up to a maximum number of 100,000 common shares, in the form of Unvested Stock Awards, for services to be rendered in 2012 . . . . . .the Unvested Stock Awards are intended to provide an incentive to our President and CEO to increase his efforts for the success of us.’
According to Bloomberg Businessweek, Bozotti got total cash remuneration for 2011 of $3.9 million made up of $1 million in salary, $1.5 million in bonus and $1.4 million in ‘other compensation’.
According to IC Insights, ST’s revenues dropped 21% between Q1 this year and Q1 last year in a flat market, while ST’s share price has halved in the last twelve months and the company’s revenue run-rate is back to where it was seven years ago when Bozotti took over as CEO.