Thank you. I will now take a few moments to explain the virtual meeting and voting procedures that we are using today. If you experience any issues with connectivity to the online platform for this meeting, please refer to the instructions provided on the web page for the meeting. You can also refer to links on the guide available on the platform under Download for specific procedures for voting and asking questions. You can cast your vote via the online platform using the electronic voting card that you received when you validated your registration. To cast your vote, scroll to the bottom of the voting card and click the blue button Cast Vote. If you change your mind, simply select the Edit Card button.
You can change your vote as many times as you wish until the close of the poll, just fifteen minutes after the end of the meeting. You can vote at any time during the proceedings. I will close the voting after all resolutions have been considered and once we have concluded the Q&A section. At the conclusion of the meeting, you will also see a red bar with a countdown timer at the top of the webcast and slide windows, advising the remaining time left for you to submit your vote. Please note that only shareholders, proxy holders, or shareholder representatives may vote on the web page called Proxy Voting. Select the category or resolution which your question relates to, type your question and click the blue Submit Question button. This will send the question through to the CEO and company secretary.
If your question has been answered and you would like to exercise your right of reply, you can do so by submitting another question. I will consider all questions submitted online and alternate between those questions here on the floor and those online. I'd like to begin the meeting by introducing my fellow directors and executives who will be presenting today. Joining us in person are Mr. Steve Baylis, Independent Non-Executive Director and Chair of our People and Culture Committee. Ms. Amanda Cribb, Independent Non-Executive Director and Chair of our Audit and Risk Committee. Mr. Steve Donovan, Non-Executive Director. Mr. James Johnson, Non-Executive Director. Mr. Grant Straker, our CEO and Managing Director, Director, as well as Co-Founder. Mr. David Ingram, our Chief Financial Officer and Company Secretary. I would also like to acknowledge the online attendance of Mr. Richard Croucher, who is representing our auditors, BDO.
Ms. Louisa Di Bella from Talbot Sayer, our Australian lawyers, and Mr. Dean Oppenhuis from Bell Gully, our New Zealand lawyers. Today's agenda will include four resolutions from me, followed by a presentation from Grant Straker, during which he will provide an update explaining the business. At the conclusion of Grant's presentation, we will respond to shareholders' questions that have been submitted to the online platform. Following the question, we will deal with the formal business of the meeting, including considering the resolutions as set out in the notice of meeting. Each resolution will be considered in due, and we will allow time to respond to questions regarding each resolution. The meeting will conclude at the end of the third item. So my name is Linda Jenkinson, and I am Straker's new independent non-executive chair. This is my inaugural annual general meeting of Straker shareholders.
I intend on providing a brief review of key highlights of FY 2024 before handing over to Grant Straker, our Managing Director, and David Ingram, our CFO, for more detail on each item. But first, I would like to highlight the critically trending protein power industry. Our industry continues to be in a state of transition, shifting rapidly from traditional processes to AI-based solutions. This is by no means a phenomenon unique to the translation and localization sectors. Industries from healthcare to the legal profession to financial services are evolving their workflows and processes to reap highly anticipated benefits of generative AI. For Straker, this is no surprise. While as generative AI began to dominate conversations in late 2022, AI has been at the heart of Straker's ethos and product offering since the entry into the industry in 2010 .
Our technology leadership, well highlighted by our strategic translation partnership with IBM, had its genesis almost 15 years ago in our founder's understanding that a gap in the market existed for technology-based translation services that could utilize both machines and humans to produce highly accurate, faster, and more cost-effective translations. Iterating improvements to this original insight has underpinned our product offering ever since.... Our commitment to innovation has recently yielded several unique product releases, such as AI Verify, which has received much interest from customers. We don't intend to rest, though, and will continue to invest strongly in R&D. The vast majority of our budget in this area is dedicated to AI initiatives. In FY 2025, and shareholders can expect to see further product releases.
Ours is a highly fragmented industry, and we continue to believe that a vast number of our cottage industry scale competitors will not have the resources, balance sheet, or expertise to compete in an AI world. We are already seeing signs of these competitors exiting the industry. This bodes well for Straker. With that said, I would like to return to a few highlights from some time. Straker's financial results for FY 2024 demonstrate the combined benefits of outstanding cost control and an evolving product offering in an environment of constrained market conditions. As the year progressed, we tempered our expectations for revenue due to customers more tightly controlling their own expenditure than originally forecast, and delivered NZD 50 million in sales for the full year.
A key highlight in these challenging conditions was the contribution from our new managed services business, which reported significant growth from standing start in the second quarter, ending the year as one of our most important top-line contributors. While revenue declined year-on-year, the company achieved an outstanding level of profitability. The trend of improving gross margins over recent reporting periods continued throughout FY 2024, and we have generated a dramatic improvement in gross margins of 950 basis points over the last two years. This has been due to technology gains, the integration of acquired business, as well as the rapid growth in the managed services business. A record gross margin allowed us to report a gross profit of approximately NZD 32 million.
I'm very pleased to highlight that we achieved a record Adjusted EBITDA of NZD 4.5 million, which is three times last year's result. This remarkable improvement is a direct result of our enhanced gross margin and our relentless focus over the past several years on boosting the efficiency of our operations. We are now capable of delivering improved services to our customers with fewer resources. The increased sustainability of Straker is particularly evident in our production segment, where the core of our work is performed. Through continuous innovation, we have reduced the resources allocated to translation by 29% over the last 18 months, whilst simultaneously maintaining the quality and reliability our customers expect. Our business is exceptionally well positioned to capitalize on a returning more normalized customer activity without the cost savings we have diligently implemented.
Our efforts to achieve sustainable cost reductions have been a fitting stage for a profitable future, and this focus on expense management is unchanged. In the field of product management development, growing demand for AI-powered content verification has opened significant opportunities for Straker. This generative AI-based offering, we call AI Verify, was successfully launched before the year's end. AI Verify is an advanced AI agent using multiple large and small language models, combined with human verification, to significantly reduce the time and cost of translation and verification. We also see other opportunities with this process and non-related translation processes that with denser verification and human insights. Our growing suite of AI-driven applications, including AI Cloud and AI Verify, are key to increasing Straker's software and service revenue. This is one of our primary objectives for FY 2025 and beyond.
Shifting more of our revenue from the suite to the recurring suite enhances the predictability of our revenue and has the clear and strong margin. Businesses with such quality are generally afforded superior valuation by investors, and we hope to benefit from this preference. A larger portion of our annual R&D budget is now allocated to further innovations that support this shift in revenue mix. Straker remains steadfast in its commitment to innovation, investing approximately NZD 8 million each year in developing new solutions for our customers. We view this expenditure not as a cost, but as a strategic investment in our future, ensuring that Straker stays at the forefront of generative AI-driven applications for localization and other [audio distortion]. A standard feature of FY 2024 was our ongoing generation plan.
We raised over NZD 2 million in free cash flow during FY 2024, which has not only been Straker's already robust balance sheet, but also provided the board with substantial flexibility to navigate share market conditions. Thus, we were in the enviable position of being able to take advantage of a weak market for ASX and [audio distortion] generally, in what the board considers to be the market's mispricing of Straker shares, in particular, to launch and complete a share buyback of [audio distortion] . Getting back to our outlook, [audio distortion] .
[audio distortion] . I take this opportunity to acknowledge the good success of the business over the three years. We wish him well in his future endeavors. On behalf of the board, I'd like to thank our CEO and director, Grant Straker, and the whole executive team for the group's plans over what we could do and how we get to the end of that year. Our collaboration and ongoing outstanding service delivery would not be possible without the talent, [audio distortion] around the world. [audio distortion] verification solutions to our customers.
We would also like to thank you, our shareholders, for your continuing support. I look forward to updating you again with my view on the company as the year progresses. I will now hand over to Grant and the team.
Thank you, Linda, and fantastic to have you on board with the team. First of all, just on behalf of myself and the other major shareholders that sit on the board, I fully recognize that the market performance of the company this year has been painful for a number of shareholders. I would like to just take you through now why, while the market hasn't appreciated possibly where we are in the world of AI, that we are, in fact, as Linda has outlined, in a very good, very good space. First of all, our mission is to harness the power of human insight and artificial intelligence to drive unparalleled productivity. Disruptive technology that doesn't drive significant productivity gains isn't really being disruptive.
This is our mission, and it uses all of the assets that we have in the company, the thousands of humans, the platform, the AI that we've worked with for more than a decade. Just a quick rerun through of FY 2024. As Linda outlined, strong financial performance generated strong revenues in a challenging economic conditions. We reduced our OpEx. We've achieved positive free cash flow. We've completed a share buyback, and then we've fostered innovation and positioned ourselves for future growth. We launched AI Verify, we released our AI Cloud with integrated workplace apps. We released our Microsoft Teams and Slack TMS integration. We've demonstrated that mainstream AI is a positive development for Straker, and I think that's important because there is a perception that AI is a threat.
We believe it is a far bigger opportunity for the company. We've matured some of the key alliances and built new ones that are enabling us to channel, to take the innovation that we're building and, and to thrive and, and to grow. So in terms of these strategic achievements, I think it's important to really, for me to thank the team. I think our team have done an outstanding effort to get through the objectives that we set them, and that I set the team at the start of the year. So the first one that was, we were to be, cost efficiency and cash generation was key. This was not a year where we wanted to raise capital.
It was a year where we needed to make money, and we needed to make our business super efficient in the new world of AI, so a fantastic achievement, and certainly, I think anybody that's been involved in these processes know it's never an easy achievement. The second one was digital transformation. This is possibly the hardest achievement. This is to invent new products that lead the world as AI hits the mainstream. And again, some fantastic products have been built. Some enormous, very sophisticated innovation from the team, that positions us very well as we go into the next 12 months. And then thirdly, alliances and partnerships, really critical to us that we have these very strong partnerships.
I think anybody that can see where big tech is going around AI know that if you can be in the slipstream of big tech and really ride that train, you are gonna be in a very, very strong position. And so these were the three things that we set out at the start of the year to achieve. The team have done an outstanding job on all three. In terms of our industry, it remains large and ripe for disruption. There are a few different models going around as the true size of the industry, but it's certainly more than NZD 50 billion, certainly significant. And this is leading to some really big opportunities as the industry consolidates and restructures. And people have talked about consolidation in the industry for a long time.
I think now the time has arrived where that will start to happen because the technology offerings now are just too compelling for the end user not to go that way. And also, you've got a change in where content lives, and that is changing the owner, and that is making it easier for our sales teams to get to the owner of content and to put our solutions in place. Again, if you look at the industry concentration, still a massive concentration at the top, across the top hundred companies, but a huge amount of opportunity in the other 80%, as Linda outlined, who will struggle to compete with the technology and the investment that is needed to meet the buyer demands that we're currently seeing. So again, moats are coming down.
One of the reasons that there are twenty thousand players in this industry is that there are moats that have been there for many times, and all of them are starting to fall by the wayside, opening up a massive opportunity for Straker. So, AI Verify rather than translation, significant cost change, a change in content and channels, as I've talked about, and we're starting to see us partner in some of the platform and workplace app spaces. As more and more people embed large language models for translations in their platforms, that opens up more opportunities for Straker Verify solution, as opposed to it being a threat where people were saying, "Well, this platform's plugged in translation." Yes, they are. Basic translation, we're offering the human verified quality translation that can sit on top of that.
And not all of the content will go there, but even if we get 10 or 15% of that content, it's a significant revenue opportunity. And we're offering significant savings, which is a really strong reason for customers to look to change. And the other thing is that the trust in the local vendor and a regional vendor for larger companies is now no longer a moat. People are quite happy to go with a global player. So all of these things align to the Straker value proposition and our strategy. I'm just gonna take you quickly through the AI Verify process flow, just to give you an understanding of actually what we're talking about. I know it's hard to conceptualize, so this is maybe one way that we can help people understand where our innovation sits.
So yes, we have a large language model that is generating a translation, step one. The second phase is that we have a trained, smaller language model, large language model, but slightly smaller than that, that very generic one, to do Quality Evaluation. So this can do segment analysis on every segment in that translation and rate it, and give it a quality score. If the quality score is good enough for the content that the customer wants, you can use that content. If it's not, we can then go into a review process, something we call APE, which is Automated Post-Edit, where multiple large language models review that content and discuss it between themselves as to whether it's good enough. If they can come up with a good enough answer, then again, we use that machine-generated, AI-based translation.
If it's not, we can send it for human verification. This is an AI Verify process, and I'll just have a look at the commercials around this. In a traditional translation workflow, the machine translation on 10,000 words might have been NZD 5 . For 10 hours of human review, it might have been NZD 500 , and these are just illustrative examples here. The total for that translation may have been NZD 505 . Now, when we get to the Verify workflow, what's happening is that we are now moving into a token-based billing engine. Again, we're riding in the slipstream of these technology companies, where everything is about how tokens are utilized. Now for the base translation, it may be 300 tokens, NZD 6 .
For the AI Quality Evaluation, it might be 5,000 tokens, but NZD 100. So again, the price is changing as the model becomes more refined and more relevant. For the AI-assisted quality boost, then you're looking at 7,000 tokens and NZD 140. For the human verification, you might be looking at NZD 50. If you had just AI Verify only because you just wanted a good enough translation, it would be NZD 246, so a 51% saving on a traditional process. If you had AI with a human pricing model, then it's NZD 321, right? So a 36% saving. Very compelling reasons why customers would want to switch to an AI Verify-based translation process. Significantly less human involvement, more AI translation involvement, but it's not one language model.
This is an AI agent. It is not just an AI translation. It is an AI agent that is working through a process and refining to where we need to get to, and also has the human AI involvement. So a very different process and one that we know has very good product market fit from the engagements that we have had with a variety of customers to date. The second part of this, and there are two things I think you'll hear more and more about in the coming 12, 24 months in the AI space. One is AI agents, and the other one is Orchestration. So we have an AI workflow orchestrator, and the idea of the orchestrator is to allow customers to configure the optimal billing rate that they need.
So if they just want a good translation, they may well be happy to just go through a couple of simple steps of AI. If they need it for a highly accurate healthcare-type translation, possibly they go through all the steps, but they'll have a limit on how many times they might wanna do the loops on AI because of the cost of tokens. So they might do two loops in one language and then go to human review. They might do four loops in another language, 'cause the tokens are cheaper, and then go to human review, or they might not go to human review at all. So the Orchestrator is something that customers have asked for as they've started to work more with AI translation.
So again, until you're in the space, until you're selling it, until you're working with customers, you don't quite know what they want. So the good news for us is that we're out there actively doing this and iterating very quickly to give us a strong, compelling, competitive advantage over the rest of the industry. On top of this, we also had our teams in Slack Workplace app, so we remain committed to the fact that the easiest solution will win. The easiest way that you can get to your translation process, that you can manage it, that you can do chat. If you're in the tools that you use every day, then it's significantly easier. And again, this is something we've seen with IBM, who are rolling out our Slack app.
It's something that is very compelling to the user, simplifies what they do every day, and means that they don't have to go into another highly complex app, remember passwords, remember how it works. They're just working in the tools that they use every day. So another piece of fantastic innovation. Our go-to-market strategy really is around a whole range of strategies, depending on what we are trying to sell. So Verify, you know, we deepen ecosystems. We're looking at platforms. We're going through online and social, Slack and Teams. Again, deepen the ecosystems that use those tools. So we're deep with Microsoft. We're well into Salesforce and Slack as a partner.
Managed Services, an area of our business that we've seen, larger customers have a need for, where they don't want to have internal teams managing processes, but they want to outsource it. If we're at the heart of the Managed Services environment, then we're controlling the processes that happen and the tools that they use, so it's a good place for us to be. Again, this is a senior decision inside an organization. Our Gap Pro, our Gap analysis tool is, again, through large integrators and ecosystems. And then our Verify toolkit is really our platform toolkit, where you can plug Verify into a platform that's got a large language model. And again, we've got different platforms asking us for different types of solutions, so it's an evolving model for us, but one that we see some huge potential. So how are we tracking?
So we have a major project with IBM in Japan called Swift Bridge, with the Tokyo Stock Exchange. It's very exciting. It's just reaching the getting into the trial phase release phase. So expect to hear more about that, going into next calendar year. Verify, we've got live customers. The technology is all working, the Billing Engine's working, the Quality Evaluation's working. So again, you know, we're into a live environment where things are happening. IBM are doing a major internal rollout of Slack, which has given us a great story to talk to other potential users of Slack. And we've got a joint bid with Salesforce for a major global customer, where they've needed multilingual support. So again, 12 months ago, that wasn't something that we could do.
We weren't getting these large tech companies coming to us saying, "Hey, can we partner?" They've seen our technology, we've been in their ecosystems, and they're asking us, and then we've got Foxit at the platform, integration underway, and again, that's a company with 700,000 customers that we will get access through to our platform. So summary and outlook. Again, you know, big industry, ripe for disruption. We've got a unique technology offering. We've got some network effect through our partnerships. You know, we've got a profitable and significant revenue base that we can work through as we start to transition into this world of AI. Profitable and free cash flow positive, and it's a transitional year, and the AI impacts in the industry are starting to create some great opportunities.
So with that, I will hand over to David Ingram.
Thanks, Grant. Good afternoon, everybody. First, I'll go through the income statement, and give you a bit of color on that. So, the very positive story in FY 2024 is both our increase in profitability, measured by our adjusted EBITDA and strong cash flow. The significant increase in EBITDA and cash flow was achieved despite the drop in revenues. Revenue was impacted by the following factors: The macroeconomic conditions impacting the industry, and this was evident in all our regions. Some existing clients took a hard line on expenditure and held off on localization projects. The advent of generative AI created uncertainty in spends and deal flow as prospects and clients alike took a wait and see approach. While the onboarding of our largest customer, IBM, during FY 2022, 2023, had a significant impact on our revenue results, impacting our comparisons.
While also not immune from cost-saving pressures, IBM benefited from our platform efficiencies, where translation memory is stored for future use. We also saw an institutional contract center, which resulted in IDEST, an acquisition in January 2022, not achieving their remaining earn-out. We do, however, have several significant tenders currently under evaluation. The strong pipeline positions us well for potential upside in the IDEST business. The upside to our sales year was threefold. We added a new business arm in August with managed services, contributing NZD 4.2 million to our portfolio. We significantly increased gross margins, expanding gross margin by 680 basis points to 63.8%, through improved automation, price increases, and the mix of customer and business lines, and the release of our AI app creates momentum and differentiation for the year ahead.
On the overheads, excluding DA and impairment losses, dropped NZD 5 million, and this reflects our restructuring and condensed in Q3 FY 2023. The restructuring affected synergies for our more recent acquisitions and rightsizing the business in light of the challenging economics. We continue to focus on our operational efficiency. Included in overheads is a non-cash goodwill impairment of NZD 2.7 million against IDEST during the year, as they did not meet their earn-out targets. The full earn-out was included in the original purchase price valuation, and therefore, not meeting this target in full impacts on the evaluation. Now, this results in adjusted EBITDA, improving 215%, going from NZD 1.4 million to NZD 4.5 million for the year, a 9% margin on revenue.
The strong performance reflects our commitment to improving gross margin and operational efficiency and fuels our ability to invest in future growth. Just go on to the next page for the balance sheet. We continue to have a very healthy balance sheet with our cash balance at NZD 12.2 million. An excellent result considering we completed a NZD 2 million buyback during the year. We have no debt. Trade receivables was down 11%, reflecting both improved cash collections and lower revenue. This leaves working capital at NZD 11.1 million, a 4% reduction on FY 2023, while intangible assets decreased by NZD 6 million, including NZD 4.3 million of scheduled amortization for acquired assets. In FY 2024, contingent consideration is nil, as no additional payments are due under contingent consideration clauses relating to past acquisitions.
Share capital decreased by NZD 2 million, as the company completed an on-market share buyback of 3.5 million Straker shares completed in February 2024, and reducing Straker listed capital by 5.2%. As we noted at the time, the buyback was designed to take into account the trading liquidity of Straker shares, establish a share price floor, and the board's determination to maintain the company's strong financial position. Just on to cash flow. So cash flow was a highlight. Operating cash flow was positive NZD 5 million versus NZD 1.4 million in FY 2023. Receipts were 104% of revenue, the same as last year. We continued to invest in R&D, with NZD 2.7 million capitalized, up 21% on last year. This reflects an increasing spend on new initiatives in the AI space compared to legacy maintenance programs.
Finance activities included NZD 2 million outflow related to the share buyback, and this resulted in our inaugural free cash inflow of NZD 2.3 million versus a NZD 0.9 million outflow the prior year. I will now pass you back to Grant.
Thank you, David. So I just want to give outlook statement. So as we transition to new AI growth opportunities, our core focus is on delivering stable growth margins with reducing OpEx, and to be both cash flow and EBITDA positive for the fiscal year 2025. So now we will go to Q&A. So, so if there's any questions that you can put into the Q&A box. I can only see one at the moment, which was around, people struggling, with a little bit with Linda's mic. No other questions, so we'll just give it a few minutes. Okay, no questions. We'll move on.
Okay. Thank you, Grant. Thank you, David. So I will now move to the formal business of the meeting. I'm just confirming you can hear me well now? Yes, thank you. Okay. [audio distortion] . I now table the notice of the meeting, and if there are any objections, I will take the reading of the notice of the meeting. Thank you. During the course of the meeting, I will put each resolution to the meeting. Please be advised that I will be voting for all undirected proxies [audio distortion] .
Excuse me, Linda. Sorry. They're just saying that they've got a bit of a problem.
Okay.
Can I give you my mic?
Okay.
You'll take that.
All right.
Give that a go.
Okay. Here we go. Okay, during the course of the meeting, I will put each resolution to the meeting. Please be advised that I will be voting for all undirected proxies in favor of each and every resolution. Can everyone hear me now?
Yes, much better.
Okay, good. I now disclose proxy votes on the screen. These figures are as at the closing time for receipt of proxies, which is 2:00 P.M. Australian Standard Time, 4:00 P.M. New Zealand Standard Time, on Sunday, the 25th of August, 2024. I have been advised that all proxies received for the meeting have been checked, and I declare them valid for voting. There are voting exclusions that apply to the resolutions being put forward today, today's meeting. These are outlined in the notice of meeting. Item number one, financial statements and reports. The first item of notified business is to receive and consider the financial statements and auditors' report for the year ended 31st of March, 2024, all of which are set out in the company's 2024 annual report.
The annual report was published in May 2024 and is also available to download on the online portal for this meeting. There is no formal resolution required for this item, but I invite shareholders to raise questions or comments on the financial statements or on the auditors' report. Both our Audit and Risk Committee chair and our auditor are available for questions. Are there any questions? No questions.
No questions.
Okay. Resolution number one, Auditor's Remuneration. I will now move on to the next item of notified business, the Auditor's Remuneration. BDO is the existing auditor of the company and has indicated its willingness to continue in office. Pursuant to Section 207T of the New Zealand Companies Act 1993, BDO is automatically reappointed at the annual meeting as auditor of the company. The proposed resolution is to authorize the directors to fix the auditor's remuneration for the following year for the purposes of Section 207S of the Companies Act. Resolution one is on the screen, and I now put the resolution to the meeting. To record that BDO Auckland continue in office as the company's auditor and to authorize the directors to fix the remuneration of BDO Auckland for the ensuing year. Here we go. Are there any questions?
I will now pass over to Amanda Cribb, our Audit and Risk Chair, to introduce the following resolution.
Resolution two, Election of Director, Ms. Linda Jenkinson. This item of notified business concerns the election of Ms. Linda Jenkinson as director. As outlined in the notice of meeting, Mr. Heith Mackay-Cruise resigned as a director of the company effective one July 2024. In order to fill the outgoing director role and in accordance with Clause 20.8 of the company's constitution, Ms. Linda Jenkinson is submitting herself for election as a director. Earlier in her career, Ms. Jenkinson spent 11 years as a strategy consultant and advisor to Fortune 500 CEO boards and executive teams. As a partner at A.T. Kearney, she helped build global financial services practice with clients, including Bank of America. She is currently the chair of ASX listed, publicly listed company, MedAdvisor and Vinyl Group. Ms. Jenkinson is a former non-executive director of Air New Zealand and FleetPartners.
Linda holds an MBA from the Wharton School, University of Pennsylvania, a Bachelor of Business Studies from Massey University, and is a non-practicing qualifying chartered accountant. Having regard to the ASX corporate governance principles, the board considers Linda to be an independent, non-executive director. I'm delighted to introduce Ms. Jenkinson to our shareholders. Linda would like to say a few words.
Delighted to have the opportunity to chair Straker Limited. Straker is at an inflection point in terms of its growth opportunity with what we've talked about that's happening in the AI world. I see my background of 25 years of being CEO, growing large disruptive companies, is appropriate background to support Straker as chair in its growth path. Just like to thank you for the opportunity to serve, and I look forward to the future of Straker. Thank you.
It is noted in the explanatory statement that the board, with Ms. Linda Jenkinson abstaining, unanimously supports the election of Ms. Jenkinson. Resolution two is on the screen, and I now put the resolution to the meeting. That Ms. Linda Jenkinson be elected as a director of the company. Are there any questions? Thank you. I'll now pass back to Linda.
Thank you, Amanda. Resolution three, the re-election of Director Mr. Steven Donovan. The item of notified business concerns the re-election of Mr. Steven Donovan as a director. As outlined in the notice of meeting, in accordance with Clause 21.1 of the company's constitution, states that a director must not hold office without re-election past the 3rd annual general meeting after that director's last appointment or re-election, or for more than three years, whichever is longer. Steven was reappointed as a non-executive director of Straker Limited on the 25th of August 2021 by the shareholders at the company's 2021 annual meeting. In accordance with Clause 21.2 of the constitution, Mr. Donovan is retiring and submitting himself for re-election as a director of the company.
Steven was initially appointed a non-executive director of Straker on the 1st of December 2024 . He is a former partner of Ernst & Young. He qualified as a chartered accountant in the U.K. and has operated within the IT and finance industry in New Zealand for a number of years. Steven has significant experience as a director and investor in the SME sector in New Zealand, including a finance director role, accounting software provider, Greentree Software Group, which was sold to MYOB in 2016 . Other current directorships include Buro Seating Limited and New Zealand Pure Dairy Products Limited. Steven is Straker's former Chief Financial Officer and has been working with technology companies across a range of industries.
He holds a Bachelor of Economics from the University of Lancaster and is a qualified chartered accountant and current member of the Institute of Chartered Accountants in England and Wales. Having regard to the ASX corporate governance principles, the board considers Mr. Donovan to be a non-independent, non-executive director. I'm delighted to introduce Mr. Steven Donovan to our shareholders. Steven, would you like to say a few words?
Yep. Thank you. Thank you, Linda. Yeah, I've been put up for re-election again. I want to be re-elected as a director of the company. I've got an awful lot of confidence in where we're going, and I'm looking forward to going on the journey. I'm a material shareholder in the company, and to add to that, I've just bought some more shares because I really believe in what we're doing. So onwards and upwards. Thank you.
Thanks, Steven. It is noted in the explanatory statement that the board, with Mr. Donovan abstaining, unanimously supports the re-election of Mr. Steven Donovan as an independent, non-executive director of the company. Resolution three is on the screen, and I now put the resolution to the meeting that Mr. Steven Donovan be re-elected as a director of the company. Are there any questions? Okay, we will move on to resolution number four, which is the approval of an additional 10% placement capacity. This item of business concerns the approval of additional capacity to issue equity securities under ASX Listing Rule 7.1A. ASX Listing Rule 7.1A permits eligible entities to seek shareholder approval by special resolution at an annual meeting to issue an additional 10% of its issued capital by way of placements over a 12-month period.
The additional 10% placement capacity is an addition to the company's 15% placement capacity under ASX Listing Rule 7.1. The resolution seeks shareholder approval, by way of special resolution, for the company to have the additional 10% capacity provided for in Listing Rule 7.1A to issue equity securities without shareholder approval. The resolution is on the screen and is a special resolution requiring 75% of votes cast in favor for the resolution to pass.
I now put the resolution to the meeting that pursuant to ASX Listing Rule 7.1A, and for all other purposes, shareholders approve the company having the additional capacity to issue equity securities up to 10% of the issued capital of the company at the time of agreement to issue, calculated in accordance with the formula prescribed in ASX Listing Rule 7.1A.2, and on the terms and conditions set out in the explanatory statement. Are there any questions? No questions. We'll move on to resolution number 5, the issue of options to Director Grant Straker. The next item of business is the issue of options to our CEO, Mr. Grant Straker, under the company's 2020 Employee Share Option Scheme, called the Options Issue. The proposed allocation of options forms part of Grant's performance-based remuneration for the current financial year.
The options issued to Grant Straker falls within Listing Rule 10.4.1, and therefore requires the approval of the company's shareholders under Listing Rule 10.4. Resolution 5 is on the screen, and I now put the resolution to the meeting. That for the purposes of ASX Listing Rule 10.4, and for all other purposes, shareholders approve the issue of 165,100 options, and the issue of underlying shares in respect to the options to Grant Straker, the CEO and Managing Director of the company, or his nominees, pursuant to the company's 2020 LTI Employee Share Option Plan on the terms and conditions set out in the explanatory statement. Are there any questions? Resolution 6, the issue of options to closely related party to a director, Merran Straker.
The next item of business is the issue of options and the issue of underlying shares to a closely related party, to a director of the company, being the Co-Founder and Chief Operating Officer, Ms. Merran Straker. The proposed allocation of options forms part of Merran's performance-based remuneration for the current financial year. The proposed allocation of options to Merran Straker falls within Listing Rule 10.14.2 , and therefore requires the approval of the company's shareholders under Listing Rule 10.14 . Resolution six is on the screen, and I now put the resolution to the meeting. That for the purposes of ASX Listing Rule 10.14 , and for all other purposes, shareholders approve the issuance of 76,000 ...
Sorry, 78,300 options, and the issue of underlying shares in respect to the options to Merran Straker, a related party of the company, or her nominees, pursuant to the company's 2020 LTI Employee Share Option Plan on the terms and conditions set out in the explanatory statement. Are there any questions? Okay, there are no questions. I will hand over resolution seven to Aman- Ms. Amanda Cribb.
Thank you, Linda. Resolution seven, issue of options to Director Linda Jenkinson. The next item of business is the issue of options to Chair and Director Ms. Linda Jenkinson. The proposed allocation of options to Linda Jenkinson falls within the Listing Rule 10.14.1, and therefore requires the approval of the company's shareholders under Listing Rule 10.14.1. Resolution seven is on the screen, and I now put the resolution to the meeting... that for the purposes of ASX Listing Rule 10.14, and for all other purposes, shareholders approve the issue of 300,000 options to a director of the company pursuant to the company's 2020 LTI Plan on the terms and conditions set out in that explanatory statement. Are there any questions? Thank you. I'll pass back to Linda.
Thanks, Amanda. Resolution number eight. The next item of business seeks the approval of shareholders for the re-adoption of the 2020 LTI ESOP in accordance with ASX Listing Rule 7.2, Exception 13B. ASX Listing Rule 7.1 restricts the amount of equity securities which listed companies can issue without the approval of shareholders over any 12-month period to 15% of the fully paid ordinary securities it had on issue at the start of that period, subject to certain exceptions.
ASX Ruling 7.2, Exception 13B, allows the company to issue securities under an employee incentive scheme to be automatically excluded from the calculation of the company's 15% placement capacity if, within three years before the date of the issue, shareholders approve the issue of securities under the employee incentive scheme as an exception to ASX Listing Rule 7.1. Resolution 8 is on the screen, and I now put the resolution to the meeting.
That for the purposes of ASX Listing Rule 7.2, Exception 13B, and for all other purposes, shareholders reapprove the adoption of the 2020 LTI ESOP and any issue of options under the 2020 LTI ESOP for a further three years from the date of this resolution as an exception to ASX Listing Rule 7.1 on the terms and conditions set out in the explanatory statement. Are there any questions?
No.
An online poll will now be conducted on all resolutions put to the meeting. Voting will close in 15 minutes, so may I now ask that shareholders complete their voting online and submit their votes. The results of the poll will be announced to the ASX as soon as they are available, most likely tomorrow. To all our shareholders who have joined this hybrid meeting, that concludes the formalities for the meeting, and I declare the meeting closed. We appreciate your attendance today, and thank you for your ongoing support of the company. Thank you.