Mobile carrier Partner Communications Ltd. (Nasdaq: PTNR; TASE: PTNR) has taken approval of CEO Haim Romano's salary terms off the agenda of its upcoming shareholders' meeting. Sources inform "Globes" that opposition by Entropy, a consultant firm for investment institutions, to elements of Romano's remuneration plan led Partner to postpone discussion of the matter, scheduled for October 21, to a later date.
Partner is seeking to alter Romano's employment terms such that if his employment is discontinued at any time from the beginning of his new contract (last August) until its three years are up, he will be eligible for all the terms, including management fees and expenses, through the end of the period. Under the previous employment terms, Romano was entitled to a six-month notification period and a six-month acclimatization period.
Romano has led his company for three years, during which its results have declined, like those of its competitors. Partner's 2013 net profit was NIS 135 million, compared with NIS 478 million in 2012, and the cost of Romano's employment last year totaled NIS 4 million, one third of which was equity-based compensation.
This salary cost does not include a NIS 3.5 million bonus, which Romano waived in view of the company's poor performance, a decision that shows that under his employment terms, he is entitled to bonuses not linked to the company's results. Partner finished the first half of 2014 with a NIS 98 million net profit.
Bonus for former chairman still on the agenda
In the notification of the upcoming annual shareholders' meeting, the company states, "As part of its remuneration policy, Partner has the option, at its discretion, of giving bonuses for periods defined in advance, such as for the period assigned for ad hoc officeholders under unusual circumstances, on the basis of reasons that will be set forth in the decisions by the relevant company organs."
At the same time, Partner praises Romano's achievements, saying, "His important role… in navigating Partner through the stormy waters of the Israeli telecommunications market," and "He led Partner to significant accomplishments, including implementation of the streamlining plan in all areas of the company." These considerations brought the board of directors to decide that retaining Romano as CEO and "ensuring the continuity of his services for a prolonged period" was important for the good of the company.
While discussion of Romano's employment terms was postponed, the vote on the bonus for former board chairman Shlomo Rodav remains on the agenda. Partner wants to approve NIS 1.3 million in remuneration for Rodav for his two-thirds position during the 10-month period between his appointment at the end of January 2013 and his resignation in November 2013.
Published by Globes [online], Israel business news - www.globes-online.com - on October 14, 2014
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