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EOH Holdings paid its former CEO, Stephen van Coller, an ex gratia amount of R15-million – in addition to his salary and bonus payments – when he resigned from the JSE-listed IT company at the end of March.
The payment was disclosed in EOH’s annual financial statements for the year ended 31 July 2024, which were published last week.
The ex gratia payment of R15-million represents almost 2.5% of the company’s R644-million in interest-bearing bank loans as of the 2024 year-end on 31 July 2024.
Much of Van Coller’s time at EOH was focused on selling company assets to deal with a distressed balance sheet that threatened to drag the business down.
The payment also comes amid unhappiness among EOH shareholders about the company’s remuneration policy.
At its AGM last year, EOH failed to secure the necessary 75% approval for the remuneration policy and a related implementation report. Barely 50% of shareholders voted in favour.
Van Coller’s fixed remuneration for the 2024 financial year – in which he worked at EOH for eight months – was R7.4-million, down from the R10.5-million he was paid in 2023 (for 12 months of work).
He also received R3.2-million in short-term incentives plus the R15-million ex gratia award, bringing his total remuneration for the period to R25.7-million (or R32-million including long-term share incentives that vested in the period).
MTN bonus
According to various definitions, an ex gratia payment is typically a goodwill amount paid by a company to an individual for damages or claims, without the firm admitting liability. EOH said the payment was in recognition of a 2018 share ownership plan (conditional shares), which Van Coller forfeited at the time.
Asked to comment on Monday, Van Coller told TechCentral that the payment – which he believes was R10-million, not R15-million – stemmed from his decision to forgo a bonus payment when he resigned from MTN Group to join EOH in 2018.
Read: EOH Holdings to be renamed
TechCentral understands that the payment was not part of a negotiated exit from EOH but rather was offered to Van Coller by the board, which he then accepted as settlement related to his forgoing the MTN bonus to join the IT services company. – © 2024 NewsCentral Media
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