The Oriole Resources PLC (LON: ORR) share price fell 5% after revealing that it would issue new ordinary shares to its directors for forfeiting their salaries. The company plans to issue 2,116,259 ordinary shares to some board members after they gave up to £7,000 of their gross salaries in April 2023.
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The new shares will be issued at a 25% premium to the previously agreed-upon price under the six-month salary sacrifice scheme announced on 2 November 2022. The over 2 million shares will be priced at 0.205 pence each in recognition of the recent rally in price and the 25% premium to the agreed-upon price.
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Oriole Resources noted that since June 2022, its company directors had forfeited a significant chunk of their salaries, totalling about £140k of gross salaries. The issuance of new ordinary shares has always compensated the directors. After the latest conversion, the directors will own about 8.41% of the company’s issued share capital.
According to the details released by the company, the salary sacrifice scheme was started in November 2022, when the directors agreed to forfeit at least 20% of their gross salaries. The deal was part of a six-month commitment that ensured the directors were compensated for their salary sacrifice with shares in the company.
As we approach the end of May 2023, it is clear that the initial six-month period is coming to an end, and the company has to launch another program if it wants to continue compensating its directors with ordinary shares.
The last significant announcement from Oriole Resources was on 5 May 2023, when the company posted its annual report for the year ending 31 December 2022. The report and notice of the upcoming AGM attracted much interest from investors.
Before the annual report positing, the company announced another issuance of ordinary shares for the salary sacrifice scheme, leaving the company’s directors as significant shareholders. During the release of the annual report, the company’s directors also gave live presentations about the same report to investors.
Therefore, whether Oriole Resources shall create another share sacrifice scheme once the current one expires to continue compensating its directors with the company’s shares remains to be seen.
*This is not investment advice.
Oriole Resources (ORR) share price.
The Oriole Resources (ORR) share price fell 5% to trade at 0.19p, from Thursday’s closing price of 0.20p.
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