Creditman,
First of all, thanks for the kind words. I wasn't at the annual meeting, but I did speak with investors who did attend and I have a pretty good idea of what was said.
As to the fact that $400 K is quite common in the US... I don't have a problem with a CEO with a high salary, as long as he does a good job. If the CEO is doing a good job, and shareholders are making money, it's OK for him to get a nice salary. However, if he performs poorly, for any given reason, he shouldn't be getting the same pay he received before.
AMAT lowered their executives salary because of the tough times. We all agree that DSSI (and Tower, its major asset) are not doing that great currently, so why should George Morgenstern get the $400K he a year earlier. BTW, he also gets 2 company cars (have no idea why he needs 2 cars) and we (company shareholders) gave him a nice loan to buy a house in Israel.
Meanwhile, his performance has been sub-par (just look at the stock price)... he made several errors in the PHD deal, and so far his strategic planning for Comverge hasn't been that great either. Why on earth shouldn't he take a pay-cut, after all we took quite a decent cut - again, just take a look at the stock.
Mr. Morgenstern barely owns any shares of OUR company, yet he treats it as if it were his own private company. He must understand that DSSI is NOT his company, it is OUR company, and he is working for us and not the other way around. If he won't understand this very simple notion, we'll have to make him understand...
George has a lousy reputation on the street, as well as in Israel (people stay away from DSSI because of him). I am not just bashing him, remember I own shares !!! I tried very hard to interest brokerage firms in DSSI, all of them responded the same way - "we don't like Morgenstern". I don't know exactly why he has such a bad reputation, but as time passes it becomes clearer and clearer.
IMO,this company won't reach its full potential as long as he's at the helm. Even when people understand what a great company Comverge is and understand what Tower is really worth, we will still probably carry a hefty discount... I call it "the Morgenstern discount". I believe that with a new guy at the top, investors will take a closer look at the company, and find out what a gem it is. Than we could lose this huge discount, and really make some money.
I still think DSSI is a great long term play. Eventually the company's true value will affect the stock's price. Even with Morgenstern, we should be able to reach much higher levels (though, no thanks to him).
You asked what I think of Tower. Well, I believe it will be one of the more interesting plays in '99. I don't expect anything spectacular this year, but once we get several announcements regarding the microFLASH (towards the end of the year, or early '99), the stock will start moving higher. Within the next 6 months we'll get several answers questioned, like who will be partner for Flash, Partner for FAB-2, Government grant and more. I believe that the street will like the answers Tower will provide, and take the stock back to its highs.
Omer |
