Thursday 13th June 2019
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The New Zealand Shareholders Association says it will vote all the proxies it holds against the election of Peter Huljich as a non-independent director to Pushpay Holdings’ board.
Pushpay’s notice of meeting failed to include in Huljich’s biographical details the fact that in 2011 he had pleaded guilty to misleading investors in his KiwiSaver scheme, NZSA says.
Huljich himself was fined almost $113,000 while the company, Huljich Wealth Management, was fined $239,000 plus $95,265 in legal and court costs.
NZSA says the failure to include these details is not “consistent with relevant commentary in the NZX Corporate Governance Code.”
That code says that companies should include key information about candidates standing for election as directors for the first time including “any material adverse information.”
Huljich had previously been an alternate director for his father, Christopher, between Nov. 7, 2018 and May 8, 2019 and was appointed to the board in his own right on May 8. That means his position on the board has to be endorsed or rejected by shareholders at the annual meeting.
Huljich and his family interests own almost 22 percent of Pushpay.
The Pushpay notice of meeting does include the fact that he and his father co-founded Huljich Wealth Management in 2007 which had managed the largest KiwiSaver scheme in terms of members at that time with a manager that was 100 percent-New Zealand owned and that the KiwiSaver scheme was sold to Fisher Funds Management in 2011.
NZSA says in advice to members on how it intends to vote the Pushpay proxies it holds that Huljich had been involved in “controversial activities” and had been convicted and fined for misleading the public.
“With this background, even allowing for the passage of time, we have concerns around the appropriateness of this appointment,” NZSA says.
“We also consider that this adverse information should have been disclosed in the notes accompanying the notice of meeting.”
BusinessDesk has asked Pushpay why the information about the fine and conviction weren’t included in the notice of meeting but Pushpay has not yet responded.
BusinessDesk has also asked NZX whether it is aware of the situation, whether it is concerned about it and whether it intends to take any action, and, if so, what action.
Pushpay, which is finding a market in the US faith sector with its electronic collection plate software, is also asking investors to approve an increase in the pool for non-executive directors’ fees from US$450,000 to US$650,000. The existing fee pool was approved by shareholders in 2015.
NZX says it will vote its proxies in favour of this resolution. “Although the headroom looks generous, it is clear from our discussion with the company that it is required if they are to recruit a director from the US. The company has undertaken to explain this fully at the meeting.”
Pushpay reported a maiden net profit of US$18.8 million after recognising a US$20.9 million deferred tax asset.
However, the company produced a small profit at the earnings before interest, tax, depreciation, amortisation and financial instruments level for the year ended March. It is expecting positive ebitdaf in the current year of US$17.5-19.5 million, so looks as if it will be able to use that deferred tax asset in the foreseeable future.
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