Based on recent news accounts, one would conclude that things are going swimmingly at Ebix, Inc. (EBIX), an Atlanta-based company that supplies the insurance industry with software and e-commerce solutions. And based on an 8-K that Ebix filed late yesterday afternoon, we’d say that’s also true for the company’s CEO, Robin Raina.
Just this month, Ebix announced record revenues for the second quarter of fiscal 2012, that it had acquired a London-based online insurance trading platform called TriSystems Ltd., and that it’s buying two more new office buildings in India (adding to the three it already has there) so that it can add to a staff that already exceeds 1,100 workers.
For Raina, the good news comes with a lot of dollar signs attached. The board approved a new compensation plan for Raina, and it started by boosting his base salary to $1.3 million per year. That’s a big increase from last year: The proxy filed in October, 2011 disclosed that Raina’s salary had been “just” $800,000 a year, so that’s an instant increase of a half million dollars.
The new plan also gives Raina the potential to earn up to $2 million more each year from bonuses. The “annual base bonus” is worth $800,000, and to get it, Raina must meet four criteria. While the criteria refer to “targets,” whatever numbers they represent are not spelled out in the regulatory filing.
And if the board determines that Raina “has exceeded his objectives, goals and targets by a wide margin,” it can bestow upon him an “additional supplemental bonus” that could be worth as much as $1 million. In addition, we mustn’t forget the potential “leadership bonus” that’s available. To get that extra $200,000, the board must determine that the
“…Company has met certain overall goals under his leadership, including, among other things, the successful integration of acquired companies, achieving operating margins targets for acquisitions, strengthening the Company’s platform outside of the United States, management retention, and successful IT audits.
And finally, to celebrate the company’s current good fortunes, the board decided to give Raina “a one-time special bonus” worth another $800,000. Most of that comes in the form of a cash award ($500,000), but there is also a stock grant of 12,500 shares worth $300,000.
Clearly, Raina and Ebix are riding high together. But unlike other companies we sometimes write about, even shareholders got invited to this party: Despite the stock’s fluctuations earlier this summer, its current trading price is up nearly 46% compared to a year ago. So long as that remains the case, we suspect that the champagne corks will be flying (metaphorically, at least) at the shareholders’ meeting at the end of the year.
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