Due to the Corona pandemic, this year's Air France-KLM AGM (Annual General Meeting of Shareholders) was again not physically attendable. Instead, a webcast was held. The SPAAK board jointly prepared and followed this AGM and webcast.
The top of the AF-KLM board sat in front of the cameras and took turns on part of the agenda. Despite the different circumstances, a more or less regular agenda was completed. This included accounting for 2020, (re)appointment of directors, and extension of existing capital expansion opportunities. The loan packages provided in 2020 were also secured. In order to further implement the recapitalization, it was also proposed to give the AF-KLM Board a mandate to expand the share capital by 400%.
In voting on the proposals, the SPAAK Board was guided by the continuity of KLM and the interests of KLM pilots. For a number of proposals this has led to a negative vote or abstention.
In principle, the Board believes that the remuneration of employees is a matter between the employee and the company, as is the case with the remuneration of Mr. Smith. It is agreed upon between him and the Board and approved by the shareholders. At the same time, the Board sees that the form chosen, a substantial part of which is variable and paid in shares, under the name of 'bonus' leads time and again to commotion in the Netherlands. This commotion is detrimental to the sentiment surrounding the support measures around KLM. For this reason, the SPAAK Board finds it desirable that another form of remuneration is chosen that does not repeatedly promote negative perception and has abstained from voting on the relevant proposals for 2020 and 2021.
The (usual) proposals to increase the capital included the possibility of increasing the share capital by 400%. Although it is quite possible in the current circumstances that this option may become necessary, the Board considers it going too far to give its approval in advance. We consider an additional, separate Special Shareholders' Meeting (EGM) a better opportunity to weigh the pros and cons in the right context and to assess whether the right guarantees are in place for a stable future for the company after this very large ownership change.
Due to the fact that a permanent seat on the Board has not yet been realized for a VNV candidate, SPAAK has abstained from voting on the various (re)appointments to the Board. In several collective bargaining agreements, support and effort has been agreed upon by KLM for this Dutch employee seat.
Finally, SPAAK abstained from voting on the proposal regarding the loan package of the Dutch government to KLM, because procedures are still ongoing regarding the conditions stipulated therein.
It goes without saying that the Corona crisis was also discussed at length, both in terms of its consequences for the past period and its expectations for the future.
As is well known, the Corona pandemic had a major impact on the economy in general and on the aviation industry in particular. Air France-KLM's results are comparable to those of European competitors. All stakeholders, with the French and Dutch governments and employees at the forefront, were thanked for their commitment and support over the past period.
Looking to the future, the strategy set out earlier was explained. The expectation was expressed that Air France-KLM will ultimately be able to go further and be a European leader in responsible aviation. Confidence in this is reinforced by the high market demand for tickets within the restrictions of the Corona measures.
A further recapitalization will be necessary to improve the debt/equity ratio and get through the coming period. Discussions on this matter are currently taking place.
In normal times, resolutions are passed unanimously. Now there were a good number of dissenting votes on various resolutions concerning the expansion of the share capital.
The vote on Mr. Smith's remuneration also had a substantial number of negative votes. Nevertheless, the remuneration for Mr. Smith was approved by the AGM.
Finally, the proposal to raise the maximum age for the chairman of the Board was interesting. This would make it possible to keep Ms. Couderc in her position for another 2 years in the current turbulent times. This resolution was adopted unanimously.
For the round of questions, questions could be submitted in writing in advance. Some of the questions were answered during the webcast; the rest in writing. The SPAAK board used this opportunity to ask for clarification on recapitalization and on the course of events in the granting of the loans by the Dutch government.
Unfortunately, because of the webcast meeting there was no opportunity to make and maintain contacts and to gather information in the corridors. Hopefully the situation will allow during the next AGM to strengthen and expand the network around the meeting.
For those interested, the webcast of the AGM can be viewed via the Shareholders page on the AF-KLM website. Here you can also read the questions and answers from the round table and find the results of the votes.