HDR hardman resources limited

I think Andrew Mason will send an appropriate message to the...

  1. 504 Posts.
    I think Andrew Mason will send an appropriate message to the bludgers like Alan Burns that HDR is NOT a watering hole where they can keep their long snouts in the shareholders trough without some accountability.

    I urge shareholders to show their disdain for the current board by directing their Proxies to him.

    Please find his resume sent to me by a largish holder for your consideration.

    Burns, Spencer,Raven wake up and smell the discontent.

    Andrew Mason's resume :

    Election of Directors
    Hardman Resources Ltd. AGM, November 24, 2005
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    Background
    This website describes the background and motivation for my nomination for the position of non-executive Director of Hardman Resources Ltd at the Annual General Meeting, to be held on Nov. 24, 2005.

    If you are a shareholder of Hardman Resources Ltd, I encourage you to study the information and issues presented.

    If you feel, as I do, that Hardman would benefit from a larger, more independent Board of Directors, I would greatly appreciate it if you could direct your proxy votes in favour of my election to the position of non-executive Director.


    A pdf file containing the proxy form is available here

    Andrew Mason

    October 26, 2005


    Posted on Thursday, October 27, 2005 at 02:15PM by AM | Comments Off
    Andrew Mason - Resume
    Age: 50

    Marital Status: Married, two children

    Home: Mosman Park, Western Australia

    Email: [email protected]
    Phone: 0419 777 552


    Andrew Mason is founder and currently Technical Director of Formation Design Systems, a Perth based, privately held software company which specialises in the development of design and analysis software for the civil engineering, ship design and shipbuilding industries.

    After studying architecture at the University of NSW , Andrew joined IBM Australia in 1978 as an Associate Systems Engineer, where he worked for 3 years. He subsequently worked for the Arabian American Oil Company (ARAMCO) in both London and Saudi Arabia on the development of supply chain management systems, before returning to Australia in 1984 to start Formation Design Systems.

    Andrew has a strong commercial background gained through the creation and development, over a twenty year period, of a successful technology company with a predominantly international market. He has diverse skills in business management, software design and development, project management, marketing and sales. He has specialist engineering knowledge in the areas of design, stability, construction and performance of ships and offshore structures including tankers, FPSOs and semi-submersibles.

    As a private investor in Hardman Resources and other companies in the oil and gas exploration sector, Andrew has performed considerable personal research to enhance his understanding of petroleum geology, exploration technologies and drilling methods, in order to make informed investment decisions.

    Andrew believes that it is vitally important for companies such as Hardman to have a diverse range of skills and backgrounds within their Board of Directors. He feels he can make a valuable contribution to the board through the combination of his business skills with his broad knowledge of engineering and technology.

    Andrew is currently studying towards a Ph.D. in the field of Naval Architecture on the application of Artificial Intelligence methods to the design optimisation of marine vessels.

    Posted on Wednesday, October 26, 2005 at 03:25PM by AM | Comments Off
    Motivation
    I believe Hardman to be an outstanding company with an exciting future. As the company makes the transition from a junior oil explorer to oil producer, it is vital that the structure of the board progresses with it. This involves not only the appointment of additional members, but also an increase in the diversity of backgrounds that the Directors possess.

    The value of appointing directors from different backgrounds should not be underestimated. The Australian Institute of Company Directors has expressed the following viewpoint -


    "An Australian board must have the appropriate mix of skills and competencies that are required to maximise the company’s performance.

    Ensuring the correct skills mix means that different business backgrounds, experiences and approaches may need to be considered and sought.

    Diversity in boardrooms enriches debate, promotes independence of thought and gives companies a competitive advantage. This in turn will contribute to Australia’s economic competitiveness.

    The AICD encourages its membership and wider business community to ‘look outside the box’ at options other than traditionally accepted criteria, such as the ex-CEO pool, for talent when considering new directors. This will enable groups less represented on today’s boards to be accessed."

    I have a strong technical and engineering background combined with 18 years experience as a company director, and it is this expertise, together with independent point of view, that I feel would be of value to the board and shareholders of Hardman Resources.


    Posted on Wednesday, October 26, 2005 at 03:18PM by AM | Comments Off
    Board Size
    Hardman Resources Ltd. currently has a board of 5 directors, made up of 2 executive directors and 3 non-executive directors.

    For purposes of comparison, the top seven Australian companies in the Oil & Gas exploration sector have the following board compositions -






    Not surprisingly, the trend is that larger companies have larger boards. Woodside has a 12 person Board, Santos and Oilsearch 9 Board members each. ROC and AWE have 7 and 6 Board members respectively.

    Hardman is the exception to this trend, equalling TAP Oil for the smallest number of board members, despite being the fourth largest company in the sector.

    Posted on Wednesday, October 26, 2005 at 02:29PM by AM | Comments Off
    Director Independence
    The ASX Corporate Governance Principles and Recommendations state -

    Recommendation 2.1

    A majority of the board should be independent directors.

    Assessing the independence of directors

    An independent director is a non-executive director (ie is not a member of management) and:

    1. is not a substantial shareholder of the company or an officer of, or otherwise associated directly with, a substantial shareholder of the company

    2. within the last three years has not been employed in an executive capacity by the company or another group member, or been a director after ceasing to hold any such employment

    3. within the last three years has not been a principal of a material professional adviser or a material consultant to the company or another group member, or an employee materially associated with the service provided

    4. is not a material supplier or customer of the company or other group member, or an officer of or otherwise associated directly or indirectly with a material supplier or customer

    5. has no material contractual relationship with the company or another group member other than as a director of the company

    6. has not served on the board for a period which could, or could reasonably be perceived to, materially interfere with the director’s ability to act in the best interests of the company

    7. is free from any interest and any business or other relationship which could, or could reasonably be perceived to, materially interfere with the director’s ability to act in the best interests of the company.

    Hardman Resources Ltd Board

    The board of Hardman Resources currently contains five directors, of which two are executive directors and clearly not independent, and two are independent non-executive directors. The fifth director and chairman, Mr. Alan Burns, is described as independent in the 2005 annual report, however Mr. Burns does not appear to pass clauses 3 and 6 of the ASX recommended independence criteria. More importantly, in previous years the board of Hardman Resources has accepted these criteria and had classified Mr. Burns as a non-independent director.

    1. Previous classification as non-independent. In the Hardman Resources Annual Reports of 2003 and 2004, the following statement appears –

    “The Chairman of the Board is not considered independent”.

    It is not clear that anything has changed in Mr. Burns’ relationship with the company that would result in his being re-classified and independent, other than a change in the criteria used.

    2. Failure of previous criteria. The 2003 and 2004 Annual Reports states that independent directors “have not in the last three years been a principal of a material professional adviser or a material consultant to the Company; are not material suppliers or customers of the Company; and are free from any other interest or business relationship that could detract from their ability to act in a fully independent manner.”

    Mr. Burns is recorded as earning the following fees in the 2002 and 2003 Annual Reports-

    2002 Consulting fees $157,292

    2003 Consulting Fees $171,250

    In the 2004 Annual Report Mr. Burns is listed as having fees of $190,000, however the Annual report makes clear that these fees are consulting/management fees, not directors fees.

    “The Executive Directors, being Mr. Ellyard and Mr. Spencer, and the Chairman, being Mr. Burns are remunerated for work performed based on the provision of consulting/ management services to the Company. Directors’ Fees, which are payable for duties as Directors and not based on work performed, are paid to Mr. Raven and Mr. Carroll.”

    Mr. Burns clearly fails these independence criteria, however the Hardman Resources board has chosen not to apply these criteria in 2005.

    3. Failure of Current Criteria.

    The 2005 Annual Report states that one reason for classification as a non-independent director is period of service.

    “Service on the Board for a period exceeding 10 years is a period which could, or could reasonably be perceived to, materially interfere with a Director’s ability to act in the best interests of the Company.”

    Mr. Burns has served for a total of more than 17 years i.e. from December 1986 to June 1991 and from April 1993 to the present. Combined with his consulting role within the company over the past few years it is not clear on what grounds he can be considered an independent director.

    It is of vital importance that a company the size of Hardman Resources has a board of an appropriate size, containing sufficient independent directors. Accepted practice with Australia ’s boardrooms agrees with this principle - the ASX Analysis of Corporate Governance Practices reported that for 2004 “Almost all top 100 companies concerned had a majority of independent directors”.

    Rather than achieving a majority of independent directors by changing the criteria used to assess independence, Hardman Resources should appoint additional directors who pass all of the ASX recommended measures of independence.

    By persevering with the current board structure, the Hardman Resources board opens itself to accusations of lack of independence and poor corporate governance. This is not appropriate for a company of its stature and is not in keeping with the corporate governance standards adopted by other major companies listed on the ASX.

    Posted on Wednesday, October 26, 2005 at 02:17PM by AM | Comments Off
    Copyright © 2005, Andrew Mason. All rights reserved.
 
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