notice of annual general meeting

Transcription

NOTICE OF ANNUAL GENERAL MEETING
2013
Please read the Notice and Explanatory Statement carefully
If you are not able to attend the Annual General Meeting of Shareholders, please complete
and return the Proxy Form in accordance with the specified directions.
Fortescue Annual Report 2013
Our Annual Report is available electronically at www.fmgl.com.au. Printed copies of the
Annual Report have been mailed to Shareholders who selected this option.
ABN: 57 002 594 872
NOTICE OF ANNUAL GENERAL MEETING 2013
Your invitation to attend our
Annual General Meeting for
Shareholders and to vote on
key issues
Dear Valued Shareholder(s),
It is my pleasure to invite you to the Company’s 2013 Annual
General Meeting to be held on Wednesday, 13 November 2013
at 11:00am (Perth time) in the Grand Ballroom, Hyatt Regency
Perth, 99 Adelaide Terrace, East Perth, Western Australia.
Since the last Annual General Meeting there have been four
changes to your Board. Mr Geoff Brayshaw retires as a Director
at this meeting and will not be standing for re-election. I would
like to acknowledge the valuable contribution that Mr Brayshaw
provided as a Director with the Company and as the Chairman
of the Audit and Risk Management Committee over many
years. The guidance and support he has given your Company
during his time as a Director has been of great value to the
development of your Company. As your Company enters the
next phase of its growth I am extremely pleased to welcome the
addition of Ms Elizabeth Gaines, Mr Peter Meurs and Ms Sharon
Warburton to your Board during the year.
Wednesday 13 November 2013
11.00am (Perth time)
Hyatt Regency Perth
(Grand Ballroom)
99 Adelaide Terrace
East Perth, Western Australia
Pla
in
Stre
e
t
The following pages contain details on the items of business
to be conducted at the Annual General Meeting. Your Directors
believe that each of the resolutions is in the best interests of
the Company and its Shareholders.
Adel
a
ide T
errac
e
Hyatt P
Regency
Perth
Fortescue
Centre
Terra
ce Ro
P
Pla
in
Stre
e
t
P
ad
P
The Annual General Meeting is an ideal opportunity for you
to meet your Board and senior management team and I
encourage you to attend the meeting. Voting on the resolutions
at the meeting is important and if you are not able to attend
I recommend that you exercise your voting rights either by
completing and returning the enclosed proxy form or by
lodging it online at www.linkmarketservices.com.au and
following the directions on the proxy form.
Your Fortescue Directors and management team look forward
to seeing you at the Annual General Meeting.
Yours sincerely
Rive
rside
Driv
e
Swan River
Location Map
2 I Fortescue Metals Group Limited I Notice Of Annual General Meeting 2013
Andrew Forrest
Chairman, Fortescue Metals Group Limited
Notice is hereby given that the Annual General Meeting
of Fortescue Metals Group Ltd (ABN 57 002 594 872)
(Company) will be held in the Grand Ballroom, at the
Hyatt Regency Perth, 99 Adelaide Terrace, East Perth,
Western Australia on Wednesday, 13 November 2013
at 11.00 am (Perth time) (Meeting).
If you are unable to attend the Meeting, you are
encouraged to complete and return the proxy form
attached to this Notice of Meeting. The completed proxy
form must be received at the office of the Company’s share
registrar, Link Market Services Limited, by no later than
11.00am (Perth time) on Monday 11 November 2013.
Date for determining voting
entitlements
The Directors have determined that for the purposes of
the Corporations Act 2001 (Cth) (Corporations Act), the
persons eligible to vote at the Meeting will be those persons
who are registered Shareholders at 4.00 pm (Perth time) on
Monday, 11 November 2013. Accordingly, transfers of shares
registered after that time will be disregarded in determining
entitlements to attend and vote at the Meeting.
Appointment of Proxies
Each Shareholder who is entitled to attend and vote at the
Meeting is entitled to appoint a proxy. The proxy does not
need to be a Shareholder.
A Shareholder who is entitled to cast two or more votes may
appoint two proxies and may specify the proportion of votes
each proxy is to exercise. If no proportion is specified, each
proxy may exercise half the Shareholder’s votes.
Voting by proxy
A Shareholder can direct its proxy to vote for, against or
abstain from voting on each resolution by marking the
appropriate box in the Voting Directions section of the
proxy form. If a proxy holder votes, they must cast all votes
as directed. Any directed proxies that are not voted will
automatically default to the Chairman, who must vote the
proxies as directed.
If the Chairman is to act as your proxy in relation to
Resolution 1 (Adoption of Remuneration Report) (whether by
appointment or by default) and you have not given directions
on how to vote by marking the appropriate box in the
Voting Directions section of the proxy form, the proxy form
expressly directs and authorises the Chairman to cast your
vote “for” Resolution 1. This express authorisation is included
because without it the Chairman would be precluded from
casting your votes, as this resolution is connected with the
remuneration of key management personnel.
If the Chairman is to act as your proxy in relation to Resolution
6 (Approval of Capacity to Grant Performance Rights to
Executive Directors) (whether by appointment or by default)
and
you have not given directions on how to vote by completing
the appropriate box in the Voting Directions section of the
proxy form, the Chairman will not be able to cast your vote
“for” Resolution 6 unless you mark the appropriate box in the
Important - Voting Exclusions section of the proxy form. By
marking this box you acknowledge that the Chairman may
vote your undirected proxy “for” Resolution 6, even if he has
an interest in the outcome of the resolution, and that votes
cast by the Chairman for Resolution 6, other than as proxy
holder will be disregarded because of that interest.
Subject to the above requirements being met, the Chairman
will vote all undirected proxies in respect of Resolutions 1 to 6
in favour of the relevant resolution.
If you are in any doubt as to how to vote, you should consult
your professional adviser.
The proxy form that accompanies this Notice
of Meeting must be completed and received at the office
of Link Market Services Limited, as detailed below, by
11.00am (Perth time) on Monday 11 November 2013.
Mail:
Fortescue Share Registry
C/- Link Market Services Limited
Locked Bag A14
SYDNEY SOUTH NSW 1235
Delivery:
Fortescue Share Registry
C/- Link Market Services Limited
1A Homebush Bay Drive
RHODES NSW 2138
Facsimile: (02) 9287 0309 (from Australia)
+61 2 9287 0309 (from overseas)
Online: www.linkmarketservices.com.au.
Select ‘Investor Login’ and enter Fortescue Metals
Group Ltd or the ASX code (FMG) in the Issuer
name field, your Security Reference Number (SRN)
or Holder Identification Number (HIN) (which is
shown on the front of your proxy form), postcode
and security code which is shown on the screen and
click ‘Login’. Select the ‘Voting’ tab and then follow
the prompts. You will be taken to have signed your
Proxy Form if you lodge it in accordance with the
instructions given on the website.
Fortescue Metals Group Limited I Notice Of Annual General Meeting 2013 I 3
Corporate Representatives
AGENDA
Any corporate Shareholder wishing to appoint a person to act
as its representative at the Meeting may do so by providing
that person with:
The Explanatory Statement which accompanies and forms
part of this Notice of Meeting describes the matters to be
considered.
• a letter or certificate executed in accordance with the
Corporations Act authorising that person to act as the
corporate Shareholder’s representative at the Meeting; or
CEO and Chairman’s Address
• a copy of the resolution appointing that person as the
corporate Shareholder’s representative at the Meeting,
certified by a secretary or director of the corporate
Shareholder.
Alternatively, Shareholders can download and fill out the
‘Appointment of Corporate Representation’ form from Link
Market Services Limited’s website – www.linkmarketservices.
com.au. Select the “Investor Services” tab and click on Forms.
Key Dates
Determination of voting eligibility
4.00pm (Perth time) on Monday, 11 November 2013
Deadline for lodgement of proxy forms
11.00am (Perth time) on Monday 11 November 2013
Annual General Meeting
11.00am (Perth time) on Wednesday 13 November 2013
Queries
If you have any queries regarding the matters contained in
the Meeting documents, please call Company Secretary, Mark
Thomas on +61 6218 8888.
Financial Reports
To receive and consider the financial report, the reports of the
Directors and the auditors of the Company and its controlled
entities for the year ended 30 June 2013.
Note: There is no requirement for Shareholders to approve
these reports.
Ordinary Business
Resolution 1 - Adoption of Remuneration Report
To consider and, if thought fit, to pass the following
resolution as an advisory resolution:
“That the Remuneration Report for the Company and its
controlled entities for the year ended 30 June 2013 be approved
and adopted.”
Voting Prohibition
A vote on Resolution 1 must not be cast (in any capacity) by
or on behalf of any of the following persons:
• a member of the key management personnel, details of
whose remuneration are included in the Remuneration
Report; or
• a closely related party of such a member (including
spouses, dependents and controlled companies).
However, a person described above may cast a vote on
Resolution 1 if:
• the person does so as a proxy appointed in writing
that specifies how the proxy is to vote on the proposed
resolution; and
• the vote is not cast on behalf of a person described above.
The Chairman, acting as proxy (by appointment or by
default), is authorised to vote all undirected proxies in favour
of Resolution 1.
Resolution 2 – Election of Ms Elizabeth Gaines
To consider and, if thought fit, to pass the following resolution
as an ordinary resolution:
“That Ms Elizabeth Gaines be elected as a Director of the
Company.”
Resolution 3 – Election of Mr Peter Meurs
“That Mr Peter Meurs be elected as a Director of the Company.”
Resolution 4 – Election of Ms Sharon Warburton
“That Ms Sharon Warburton be elected as a Director of the
Company.”
Resolution 5 – Re-election of Mr Mark Barnaba
“That Mr Mark Barnaba be re-elected as a Director of the
Company.”
Voting Prohibition
A person appointed as proxy must not vote on Resolution 6,
on the basis of that appointment, if that person is:
• a member of key management personnel as at the date of
the Meeting; or
• a closely related party of such a member (including
spouses, dependents and controlled companies).
However, a person described above may cast a vote on
Resolution 6 if the person does so as a proxy appointed
in writing that specifies how the proxy is to vote on the
proposed resolution.
Voting Exclusion
The Company will disregard any votes cast on Resolution 6
by:
• any Director of the Company (except one who is ineligible
to participate in any employee incentive plan); and
• associates of those persons,
other than if:
• it is cast by a person who is a proxy for a person who is
entitled to vote, in accordance with the directions on the
proxy form; or
• it is cast by the Chairman as proxy for a person who is
entitled to vote, in accordance with a direction on the
proxy form to vote as the proxy decides.
If you mark the appropriate box in the Important - Voting
Exclusions section of the proxy form, the Chairman may vote
your undirected proxy as the proxy decides and has indicated
he will vote “for” Resolution 6.
Dated this 1 October 2013
By Order of the Board
Resolution 6 – Approval of Capacity to Grant
Performance Rights to Executive Directors
Mark Thomas
Company Secretary, Fortescue Metals Group Limited
“That, for the purposes of , Listing Rule 10.14 and for all other
purposes, Shareholders approve the grant of a maximum
5,500,000 performance rights over the next three years to the
current Executive Directors of the Company, (and issue of shares
on conversion of those performance rights) under the Fortescue
Metals Group Ltd Performance Share Plan.”
EXPLANATORY STATEMENT
This Explanatory Statement has been prepared for the
information of Shareholders of Fortescue Metals Group Ltd
(Fortescue or Company) in connection with the business to
be conducted at the Annual General Meeting of Shareholders
to be held in the Grand Ballroom, at the Hyatt Regency
Perth, 99 Adelaide Terrace, East Perth, Western Australia on
Wednesday, 13 November 2013 at 11.00 am (Perth time).
This Explanatory Statement should be read in conjunction
with the accompanying Notice of Meeting.
This Explanatory Statement and all its attachments are
important documents and should be read carefully and
in their entirety. If you have any questions regarding the
matters set out in this Explanatory Statement or the Notice
of Meeting, please contact the Company or your financial
adviser, stockbroker or solicitor.
FINANCIAL REPORTS
The first item of the Notice of Meeting deals with the
presentation of the consolidated financial report of the
Company for the year ended 30 June 2013, together with the
Directors’ declaration and report in relation to that financial
year, and the auditor’s report on those financial statements
(Financial Reports).
Shareholders are asked to consider the Financial Reports
and raise any matters of interest with the Directors when this
item is being considered. Shareholders will be provided with
a reasonable opportunity at the Meeting to ask questions
about, or make comments on, the Financial Reports. No
resolution is required to be moved in respect of this item.
The vote on Resolution 1 is advisory only and will not require
the Company to alter the arrangements set out in the
Remuneration Report, should Resolution 1 not be passed.
Notwithstanding the effect of this legislative requirement, the
Board will take the outcome of the vote into consideration
when applying the Company’s remuneration policy.
Directors’ Recommendation
The Board recommends that Shareholders vote in favour of
Resolution 1.
Ms Elizabeth Gaines, having been appointed by the Board as
a Director of the Company since the last General Meeting, will
retire and offer herself for election by Shareholders.
Ms Elizabeth Gaines joined the Board as a Non-Executive
Director in February 2013.
Ms Gaines is Chief Operating Officer & Chief Financial Officer
and an Executive Director of Jetset Travelworld Limited.
Prior to this Ms Gaines was the CFO of the Stella Group, Chief
Finance and Operations Director of UK-based Entertainment
Rights Plc and was previously Chief Executive Officer of
Heytesbury Pty Limited. She has held senior treasury and
finance roles at BankWest in Australia and Kleinwort Benson
in the UK and qualified as a Chartered Accountant with Ernst
& Young. Ms Gaines is a member of the Institute of Chartered
Accountants in Australia and the Australian Institute of
Company Directors and holds a Bachelor of Commerce
degree and Master of Applied Finance degree.
Resolution 1 – Adoption of Remuneration Report
Ms Elizabeth Gaines has an interest in Resolution 2 and
refrains from making any recommendation as to how
Shareholders should vote on the Resolution.
In accordance with the Corporations Act, Shareholders are
asked to consider and vote on the adoption of the Remuneration
Report as presented in the Annual Report for the year ended
30 June 2013.
The Company’s remaining Directors recommend that
Shareholders vote in favour of Resolution 2, and each of those
Directors intends to vote all the shares controlled by him or
her in favour of the Resolution.
A voting prohibition statement for Resolution 1 is contained
in the Notice of Meeting.
Resolution 3 – Election Of Mr Peter Meurs
Resolution 1 – Adoption of Remuneration Report
The Annual Report of the Company for the year ended 30
June 2013 contains a Remuneration Report, which sets out:
• the remuneration policy for the Company; and
• the remuneration arrangements in place for the Directors
and specified executives of the Company.
A copy of the Remuneration Report as contained in the 2013
Annual Report is available on the Company’s website at
www.fmgl.com.au under the “Investors & Media” tab.
Mr Peter Meurs, having been appointed by the Board as a
Director of the Company since the last General Meeting, will
retire and offer himself for election by Shareholders.
Resolution 3 – Election of Mr Peter Meurs
Mr Peter Meurs joined the Board as an Executive Director in
February 2013 and is Executive Director - Development of
Fortescue Metals Group.
Mr Meurs’ responsibilities range from exploration, to studies
and project development, through to the delivery of major
capital expansion projects. In this role, Mr Meurs has direct
responsibility for the delivery of Fortescue’s current 155
million tonne per annum expansion and future development
plans.
Prior to commencing with Fortescue Metals Group in May
2010, Mr Meurs held the position of Managing Director at
WorleyParsons. He was a founder of WorleyParsons and is
often attributed as a key player in its spectacular multi decade
growth. During his time at WorleyParsons, Mr Meurs held
roles in project management and company development
including establishing the foundations of the process
business, the establishment and growth of alliance and
integrated services contracts in Hydrocarbons and Minerals
& Metals and the development of the New Zealand business.
Mr Meurs commenced his career working on development
projects in Bass Strait for Esso Australia. He holds a
Bachelor Degree in Mechanical Engineering, is a Fellow of
the Institution of Engineers Australia and a member of the
Australian Institute of Company Directors.
Mr Mark Barnaba retires by rotation at the Meeting and, being
eligible, offers himself for re-election as a Director.
Mr Peter Meurs has an interest in Resolution 3 and refrains
from making any recommendation as to how Shareholders
should vote on the Resolution.
Ms Sharon Warburton, having been appointed by the Board as
a Director of the Company since the last General Meeting, will
retire and offer herself for election by Shareholders.
Ms Sharon Warburton will join the Board as a Non-Executive
Director in November 2013.
Ms Warburton is Executive Director of Strategy with
Brookfield Multiplex. Prior to this, Ms Warburton was Chief
Planning and Strategy Officer of United Arab Emirates
based company, ALDAR Properties, and previously held a
variety of senior executive roles with Brookfield Multiplex
including Group General Manager, Mergers Acquisitions and
Operational Support and Group General Manager Strategy
and Operations. She is a Chartered Accountant and has held
senior finance roles at Citigroup and Rio Tinto.
Ms Sharon Warburton has an interest in Resolution 4 and
refrains from making any recommendation as to how
Shareholders should vote on the Resolution.
Resolution 5 – Re-Election of Mr Mark Barnaba
Resolution 5 – Re-election of Mr Mark Barnaba
Mr Mark Barnaba was appointed as a Non-Executive Director
in February 2010. Mr Barnaba is Chairman of the Audit and
Risk Management Committee and the Remuneration and
Nomination Committee.
Mr Barnaba serves as both Chairman of Macquarie Group,
Western Australia and as Chairman, Global Resources Group,
Macquarie Capital. He is also Chairman of The University of
Western Australia’s Business School Board and an Adjunct
Professor in Investment Banking & Finance at the UWA
Business School. Mark is the Chairman of Black Swan State
Theatre Company, co-founder (and previously co-executive
Chairman) of Azure Capital and previously has been the
Chairman of Western Power, Edge Employment Solutions,
the West Coast Eagles Football Club and Alinta Infrastructure
Holdings. He was also appointed by the Premier to chair
the WA Steering Committee of the Commonwealth Business
Forum for CHOGM in 2011.
Mr Barnaba attended The University of Western Australia. He
holds a Bachelor of Commerce degree with first class honours
and, as the top graduate of his year, he was awarded the JA
Wood University medal. He then attended Harvard Business
School to complete an MBA and graduated with a high
distinction as a Baker Scholar. After leaving Harvard, Mr Barnaba
spent the majority of his time with McKinsey and Company,
overseas, before returning to Australia in the mid 1990s. In
2002, Mark was the joint winner of the inaugural WA Business
News award for the most outstanding business leader in the
State of Western Australia under the age of 40 and, in 2009, was
the recipient of the WA Citizen of the Year Award in Industry
and Commerce. In 2012, Mark received an Honorary Doctor of
Commerce from The University of Western Australia and was
granted the Honorary designation FCPA from CPA Australia.
Mark is a Fellow of the Australian Institute of Company Directors.
Mr Barnaba has an interest in Resolution 5 and refrains from
making any recommendation as to how Shareholders should
vote on the Resolution.
her in favour of the resolution.
Resolution 6 – Approval of Capacity to Grant
Performance Rights to Executive Directors
In accordance with Listing 10.14, the Company seeks
Shareholder approval of its capacity to grant performance rights
over the next three years under the Fortescue Metals Group Ltd
Performance Share Plan (PSP) to Mr Peter Meurs and Mr Neville
Power, who are both Executive Directors of the Company.
A voting prohibition and exclusion statement for Resolution 6
is contained in the Notice of Meeting.
Resolution 6 – Approval of Capacity to Grant Performance
Rights to Executive Directors
The PSP was approved by Shareholders at the Company’s
Annual General Meeting on 14 November 2012 (2012 AGM).
In addition, at the 2012 AGM shareholders approved a
maximum total grant of 2,000,000 performance rights under
the PSP to Mr Power for the next 3 financial years.
Since the 2012 AGM, the Board has appointed a new
Executive Director, Mr Peter Meurs (who is seeking election as
a director under Resolution 3). The Company is now seeking
Shareholder approval to increase the maximum total grant
of performance rights it can issue to Executive Directors
over the next 3 years to account for the appointment of Mr
Meurs as an additional Executive Director. An allocation of
performance rights to the Executive Directors for the 2014
financial year has not yet been determined.
Copies of the PSP are available through the Company’s
website at www.fmgl.com.au, under
“Investors & Media”– “Corporate Governance” –
“Remuneration & Nomination Committee” and can be sent
free of charge to any Shareholder on request.
Remuneration objectives and implementation of the PSP
Fortescue’s reward strategy seeks to build a performance
orientated culture that:
• supports the achievement of the Company’s strategic
vision; and
• attracts, retains and motivates employees, by providing
market competitive fixed remuneration and incentives.
The reward strategy seeks to support Fortescue’s commitment
to achieving extraordinary growth and progression as one of
the world’s leading producers of iron ore, by:
• delivering fair and market competitive rewards;
• supporting a clear performance focus; and
• aligning remuneration with the long-term goals of the Company.
Fortescue is committed to providing competitive
remuneration packages to its employees. The Company
benchmarks staff remuneration against major indices such
as the ASX 100 Resources, and seeks input from independent
remuneration consultants regarding executive remuneration.
As disclosed in the 2013 Remuneration Report, the Company
has revised its remuneration strategy and introduced a long
term incentive plan (LTI) under which performance rights
are issued and have vesting conditions which are based
on the achievement of absolute return on equity (AROE)
targets measured over a three year performance period. As
a result, the Executive and Senior Staff Incentive Plan (ESSIP)
entitlements were reduced by 25%.
Under the ESSIP, participants have the opportunity to earn
a bonus in addition to their total fixed remuneration if they
satisfy the performance conditions for the relevant year.
The amount of the bonus depends on the participant’s level
of responsibility and position within the Company. Under
the amended ESSIP, the most senior participants have the
ability to earn a bonus of up to 112.5% of their total fixed
remuneration (TFR), and the least senior participants have the
ability to earn a bonus of up to 45% of their TFR.
For FY2014 the Company intends that at least 50% of any
entitlement to a bonus under the ESSIP will be satisfied by the
grant of performance rights under the PSP. Participants may
elect that a higher percentage of a bonus under the ESSIP will
be satisfied by the grant of performance rights under the PSP.
Under the LTI, participants have the opportunity to earn a
bonus if they satisfy the AROE targets measured over the
relevant three year performance period. The amount of the
LTI bonus depends on the participant’s level of responsibility
and position within the Company. The most senior
participants have the ability to earn a LTI bonus of up to 150%
of their TFR, and the least senior participants have the ability
to earn a LTI bonus of up to 60% of their TFR. Any entitlement
to a bonus under the LTI will be satisfied by the grant of
performance rights under the PSP.
It is intended that the number of performance rights to be
granted to a participant under the PSP will be determined by:
• for the ESSIP allocation, dividing the amount of the
maximum bonus payable under the ESSIP which is to be
satisfied by the issue of performance rights by the 5 day
VWAP for shares at the start of the performance period
under review (i.e. 1 July 2013) (ESSIP Performance Rights).
• for the LTI allocation, dividing the amount of the maximum
bonus payable under the LTI by the 5 day VWAP for shares
at the start of the performance period under review (i.e. 1
July 2013) (LTI Performance Rights).
The ESSIP Performance Rights vest based on satisfaction
of the ESSIP objectives. The vesting period for ESSIP
Performance Rights for 2013 ends on 30 June 2014.
If the Board determines that a participant has:
• failed to satisfy the performance conditions attached
to their performance rights before the end of the
performance period, the performance rights will lapse;
• satisfied some but not all of the relevant performance
conditions, the Board will determine the portion of the
incentive amount under the ESSIP which is payable and
the number of performance rights which will vest. The
balance of the performance rights will lapse; or
• satisfied all of the relevant performance conditions, all
their performance rights will vest and will convert to
shares pursuant to the PSP.
The FY2014 LTI Performance Rights vest based on the
performance of the Company by reference to AROE targets in
accordance with the following schedule. The vesting period
for FY2014 LTI Performance Rights ends on 30 June 2016. This
is the date on which the average AROE is calculated.
Average AROE Achieved <20.0% (FY13: <15%)
20.0% (FY13:15%)
23.3% (FY13: 20%)
26.7% (FY13: 25%)
30% + (FY13: 30% +)
Percentage Vesting
Nil
25% of maximum award
As shown in the table above, to receive the maximum award,
the AROE over the three years from 1 July 2013 must exceed
30%.
The participant will be granted the performance rights as soon
as practicable after Shareholder approval for the PSP is given.
Each performance right will entitle the holder to be issued
or transferred a share for nil consideration subject to the
satisfaction of any relevant performance and vesting
conditions within the vesting period.
The Board may, but is not obliged to use the PSP to meet
any proposed equity based incentives given to eligible
participants in future years, under incentive plans operated
by the Company from time to time..
Given the revised remuneration strategy and introduction of
the LTI the number of performance rights to be issued under
PSP will now represent the maximum number of performance
rights which may be granted under both the ESSIP and the
LTI. This approach reflects the treatment of the entitlement
to performance rights in the Company’s remuneration report
and financial statements.
Approval for the purposes of Listing Rule 10.14
Under Listing Rule 10.14, the Company requires Shareholder
approval to issue equity securities to a Director of the
Company. Accordingly, Resolution 6 seeks Shareholder
approval to issue securities under the PSP to:
• the new Executive Director, Mr Peter Meurs over the next
3 years; and
• the Managing Director, Mr Neville Power over the next 3 years.
For the purposes of the approval sought under Listing Rule
10.14 and in accordance with the requirements of Listing Rule
10.15A and for all other purposes, the following information is
provided to Shareholders in respect of the proposed issue of
performance rights under the PSP to Mr Meurs and Mr Power:
Participation
• Under the PSP, performance rights may be granted to
Managing Director, Mr Power and Executive Director,
Mr Meurs (Recipients) in accordance with the ESSIP and
the LTI and as part of Mr Power’s and Mr Meurs’ reasonable
remuneration.
• The Recipients are the only people referred to in ASX
Listing Rule 10.14 eligible to participate in the PSP. Any
additional persons referred to in ASX Listing Rule 10.14
who become entitled to participate in the PSP will not
do so until any Shareholder approval required under ASX
Listing Rule 10.14 is obtained.
Number of performance rights which may be issued
• The maximum number of performance rights that will
be granted to the Recipients (including any ESSIP and
the LTI entitlements) during the next 3 years without
further Shareholder approval is 5,500,000. This number
supersedes the approval given in 2012.
• The Board has not yet determined the allocation of
performance rights that will be granted to the Recipients
for the 2014 financial year, however that number will
not exceed 2,100,000 (including any ESSIP and the LTI
entitlements).
• The maximum number of performance rights includes
the issue of additional performance rights to Mr Power
and Mr Meurs to reflect the 2013 LTI allocation (which are
subject to the 3 year AROE vesting conditions).
• The exact number of performance rights that will be
granted to the Recipients:
ocannot be calculated at the date of this Notice of
Meeting as it depends upon Mr Meurs’ and Mr Power’s
entitlement to share based incentive payments and
the future VWAP of the Company’s shares at the date
performance rights are granted under the PSP; and
owill be calculated on the grant date by dividing the
maximum value of share based incentive payments to
which the Recipients are entitled by the 5 day VWAP
of Company shares at a the start of the applicable
performance period.
• Under the PSP, shares will only be issued to the Recipients
(and value received) upon the vesting of the relevant
performance rights.
Entitlement to shares
Subject to the terms of the PSP, the vesting date of performance
rights and the satisfaction of performance conditions attached
to performance rights, each performance right entitles the
Recipient to be issued or transferred one share in the Company.
Price
No consideration is payable for:
• the grant of performance rights under the PSP; or
• the issue or transfer of shares upon the vesting of
performance rights granted under the PSP.
Timing of issues
Performance rights will not be granted under the PSP to the
Recipients at any stage after 3 years from the date of the
Annual General Meeting without obtaining any Shareholder
approval required under the ASX Listing Rules.
No loans
No loans have or will be made by the Company in connection
with the acquisition of the relevant performance rights.
Details of prior grants
• Since the PSP was last approved by shareholders in2012,
Mr Power has been granted 341,158 Performance
Rights (of which 136,463 have yet to vest, 143,291 have
vested and 61,404 have lapsed) and Mr Meurs has been
granted (prior to his appointment as a Director) 164,514
Performance Rights (of which 53,069 have yet to vest,
82,472 have vested and 28,973 have lapsed).
All shares provided on vesting have been acquired on market.
• No acquisition price was payable for the grant of the
performance rights or for the issue or transfer of shares
upon the vesting of performance rights. No other person
under Listing Rule 10.14 has received performance rights
since the PSP was last approved by shareholders in 2012.
Other Implications
• No funds will be raised from the grant of performance
rights. If shares will be transferred rather than issued
upon vesting, funds will be expended by the Company to
acquire shares on market.
• Australian International Financial Reporting Standards
require the performance rights to be expensed in
accordance with AASB 2 – Share Based Payments. Expensing
performance rights will have the effect of increasing both
the expenses and contributed equity of the Company.
• There are no significant opportunity costs to the Company
or benefits foregone by the Company in granting
performance rights.
• The issue of performance rights to participants under
the PSP will not have a diluting effect on the percentage
interest of Shareholders holdings if the performance rights
vest into shares acquired on market.
Annual Report
• Full details of Mr Power’s and Mr Meurs’ holding of
interests in the Company are set out in the Company’s
current annual report.
• Details of any performance rights granted under the PSP
will be published in each annual report of the Company
relating to the period in which the performance rights
have been granted, with a statement that approval for the
grant of the performance rights including to Mr Power
and Mr Meurs if they are granted was obtained under ASX
Listing Rule 10.14.
Mr Neville Power, the Managing Director of the Company
and Mr Peter Meurs, the Executive Director Development
will participate in the ESSIP and LTI and so have an interest in
Resolution 6. They refrain from making any recommendation
as to how Shareholders should vote on the Resolution.
Shareholders vote in favour of Resolution 6.
A DECADE
OF GROWTH
2003
The dream begins
2004
Cloudbreak identified
2005
ASX 200 listing
2006
Port Hedland ground-breaking
2007
Construction at 70%
2008
First ore on ship
2009
27mt shipped
2010
Christmas Creek expanded
2011
Solomon Hub developed
2012
57.5mt shipped
2013
Firetail opened
www.fmgl.com.au

notice of annual general meeting

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