Ann: Notice of Annual General Meeting/Proxy Form, page-29

I have sought further clarification from the company when it became obvious that a few of us were interpreting things different and have mixed views on the agm resolutions.

Below is a high level summary arising from my discussion with the company. The purpose is really to share the information and inform how we, as individuals, vote on those resolutions in the upcoming agm.

Again, nothing I share below is market sensitive as it is all based on public information and you should be able to access the information if you approach the company directly.

Everyone can read and make up their own minds. If you wish, you can seek further clarification from the company to ensure my interpretation is correct.

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Resolution 1 – Adoption of remuneration report

I am aware that the vote on this resolution is advisory and does not bind the Directors or company. However, I would like to seek further clarification from the company.

On a year-to-year basis, the pay rises awarded to Ray, Malcolm and Duncan were 45%, 28% and 18% respectively. Can the company please provide some information to assist my understanding the justifications for the pay rises?

All three executives were on higher prior salaries but took pay cuts leading into the RTO in 2015-16, to conserve cash and help Alcidion. By its very nature as a publicly-listed company, Alcidion incurs additional cost that it would otherwise not incur (for example, compliance costs and etc) as a private company.

The pay cut conditions ended on 30 June 2017, and hence explaining the huge pay rises and salaries were reverted to what they were prior to the RTO with adjustments for indexation possibly.

Given that Kate Quirke has now assumed the CEO duties from Ray Blight, would his remuneration be adjusted accordingly to reflect the transfer of duties? I do, however, his increased oversight for the enlarged group.

Ray’s remuneration would be adjusted to reflect the transfer of CEO responsibilities to Kate. This downward adjustment would be apparent in the next directors annual report.

Resolution 5 – Approval of 10% placement capacity


My understanding is that the company is already able to issue new shares as part of the 15% annual new issue limitation. If shareholders agree to both resolutions, the company can therefore issue up to 30% of new shares?

Have I misunderstood anything here? If not, can the company please provide some rationale for shareholders to approve this additional placement, which together with the equity incentive plan, would result in a significant dilution for existing shareholders?

If shareholders are asked to vote on this, I believe that we, as part owners of the company, deserves to be provided with more information in relation to its purpose, intended use and in what situation would it be utilised.

The correct figure is a total of 25% new shares, not 30% as I originally understood. I am still confused about this as I am thinking along the lines of: current placement limitation (15%) + additional placement capacity (10%) + equity incentive scheme (5%) = 30%.

However, the 25% makes sense once you read my run down on resolution 6.

Important to note that a majority of the current 15% new share limitation would be used for the successful completion of performance targets related to the MKM Health and Oncall acquisitions.

Accordingly, Alcidion is seeking shareholders’ approval for the additional placement capacity as a safeguard to ensure it has flexibility should it be required during the year.

Resolution 6 – Adoption of equity incentive plan

I appreciate that incentives need to be provided to Alcidion employees to encourage alignment of personal and shareholder interests. However, the notice of agm announcement to the ASX was somewhat vague in terms of the metrics that would be used.

While shareholders do not expect a full run-down as it would depend on, among other things, the business division, the individual role responsibilities and geographical location, we would appreciate further clarification/visibility of the KPIs (financial and operational) that would be used to ensure alignment of  personal and shareholders interest.

Alcidion is unable to comment on this as KPIs are specified to individual employees.

However, the whole rationale of the incentive plan is to provide employees with a competitive remuneration package that rewards high performance and retain skilled employees.

Alcidion does not expects to issue any new shares as a result of this incentive plan during 2018-19. The issuing of new shares would occur in 2019-20, subject to employees meeting their individual KPIs during 2018-19.