Kevin Feeney left for one reason in my opinion.
The news release at the bottom of this post describes his hiring and the incentives in the form of stock options that were provided to him and the others on the management team at that time. $3.90 a share.
When the new CEOs were granted themselves 300K options each @ .80 cents (granted at 25K per co-CEO each month with no conditions other than being employed) and each director 300K each @ .80 cents (subject to market level targets), they did not make provisions for the other executives at the same strike price. These leftovers from the Nemis era had to keep smiling with their $3.90 options.
So you have three people in Kevin Feeney, James Mungall, and Carmen Diges take risks in leaving their jobs and joining Noront to take average salaries (compared to what their experience could command other places) with a high risk junior. They work their butts off for four months to find that their boss was forced out through a coup. Then seven days after the coup two guys, one of which did not have a job a week before due to the sell-off of his company get executive CEO positions for knowing the right people at the right time.
As a C.A., Kevin Feeney could do the math. The best demotivator in the workplace is that of perceived inquity. Like when you find out that your co-worker who does less than you actually makes 20% more. It is not that your salary is bad, but knowing that somebody who has not worked as hard as you earns more can make work unbearable at times.
With a spread of $3.10 between options, the inequity is huge.
I am not sure what the credentials of the current co-CEOs are but their lack of a good educational pedigree is starting to show. We know they are opportunists but they still have to make good management decisions to take advantage of this self created opportunities. This includes retaining excellent staff. Their first move was the PP which was a no-brainer as the dissident 40% wanted to buy more shares to ensure their majority over the retail. It sounds like they did this despite the current share price.
What should have taken brains and the first priority was to ensure that the executives that were in place were treated well as it takes ten times less effort to keep excellent employees than it takes to attract similar employees.
I work in this space everyday as a manager and to me the CEOs management inexperience is showing. Anyone can have years of experience and past job titles. It does not mean they did those past jobs well.
If the current CEOs do not provide new incentives to the remaining staff, we may see the likes of Mungall and Harvey move onto different things very fast. Then all we have left is a couple of drill teams and newly promoted paper pushers as resources. My prayer is that they do not fill empty spaces with Aurelian cronies and make NOT into an Aurelian 2.
The men and women who worked under Nemis are in the end human beings with aspirations and human emotions and it appears that cracks are beginning to show in how the current top brass manages. Stuffing their pockets with stock options, as useless as they are at today's prices, while ignoring the current staff shows how out of touch these two CEOs may actually be. It is one thing for directors to be out of touch, but another when the head of the company (in this case two heads) are out of touch with their own staff. Not to say that Kevin would not have left anyway, but to leave just five months into the job and one month after Nemis was booted tells me that there is more going on behind the scenes.
My real fear is that Mungall may follow shortly.
Dear co-CEOS:
RESTRUCTURE THE STOCK OPTIONS FOR THE OTHER STAFF NOW BEFORE YOU LOSE THE EXCELLENT STAFF THAT RICHARD NEMIS BUILT INTO A TEAM!!!! PROVE TO US THAT YOU CAN ACTUALLY MANAGE MORE THAN JUST YOUR OWN POCKETS!!!!!!!
Unbelievable.
M1.
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TORONTO, ONTARIO June 10, 2008
Noront Resources Ltd. (“Noront”) (TSX Venture: NOT) is pleased to report that the board of directors has made several appointments to Noront’s management team. Kevin Feeney, C.A ., has been appointed Chief Financial Officer of the company. Mr. Feeney brings significant financial and strategic experience to the Noront team. Most recently, in his capacity as Vice President, North American Investments, Finance and Operations for Sun Life Financial Corporation, he was responsible for designing and implementing processes to support Sun Life’s North American investment business. Mr. Feeney was also a corporate design specialist in his role as Chief Financial Officer and Senior Vice President of Labatt Breweries of Canada (Interbrew S.A.) and was a key member of the Interbrew global acquisition team that completed the USD$11B transaction with Ambev, that resulted in a significant consolidation of the global beer industry. Mr. Feeney also held various positions with the Trimark group of companies, including that of Chief Financial Officer and Executive Vice-President for Trimark Investment Management Inc.
In connection with the restructuring of the roles of existing management, previously announced by Norontin its press release dated June 6, 2008 and with the above appointments, Noront has granted an aggregate of 2,005,000 options to purchase common shares of Noront to its directors and officers for a period of five years at an exercise price of $3.90 per share.
