Khezri to receive #310,000 if board plan adopted

Baltimore Technologies executive chairman Mr Bijan Khezri will receive a £310,000 (€470,124) pay-off if shareholders vote to accept the current board's plan to enter the clean energy business.

The proposed payment represents 75 per cent of Mr Khezri's full entitlements due under his existing work contract.

He was also paid a £150,000 bonus in October 2003, according to a new circular sent to shareholders.

The circular also confirms that the firm will hold an extraordinary general meeting on May 6th to determine whether its board of directors should be dismissed.

Baltimore, which has 10,000 Irish shareholders, is holding the e.g.m. at the request of its largest shareholder, Bermuda-based company Acquisitor Holdings.

Acquisitor, which owns about 12 per cent of Baltimore's shares, is seeking the removal of the firm's board of directors and a forensic examination of the company's financial accounts.

In a statement to shareholders contained in the Baltimore circular, Acquisitor says that the Baltimore board's performance, which resulted in a collapse in market value from £5 billion to £20 million, was unacceptable.

Acquisitor also raises concerns about the current Baltimore board's alleged lack of accountability and the level of remuneration awarded to Mr Khezri.

Baltimore's board rejects the accusations made by Acquisitor in a letter to shareholders also contained within the circular. This asks shareholders to vote in favour of its plan to transform the firm into an energy business.

Both sides in the acrimonious dispute are fighting over Baltimore's £24.7 million cash, which has been raised from an asset disposal plan undertaken when it was threatened with insolvency.

Baltimore, which was formerly based in Dublin and a FTSE 100 firm, ran into trouble when the technology market crashed in 2000 and demand for its security software fell sharply.

Baltimore's current board of directors headed by Mr Khezri is proposing to use its cash to start a business that will help firms cut their energy bills. It has assembled a team of executives, led by a former BP managing director, Mr David Weaver, which it proposes to install after the e.g.m.

In an effort to refute Acquisitor's accusations and persuade shareholders to vote in favour of its clean energy plan, Baltimore's circular reveals detailed remuneration and financial information.

These show that Mr Khezri was awarded a £150,000 bonus in October 2003 for completing Baltimore's disposal strategy, which was first announced in May 2003.

He will receive a £310,000 payment in return for stepping down from his executive position at the firm. This amounts to 75 per cent of his contract entitlements.

Under Baltimore's strategy to transform itself into a clean energy business, he will give up his executive duties and become chairman with a salary of £40,000 per year.

Baltimore said the new board members named on March 31st to help transform the firm would delay taking up their appointments until after its annual results were filed in the US.