NSL provides execs ‘loan’ to fund conversion of options to shares
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ASX-listed iron ore and coal player NSL Consolidated has been repaid a so-called “loan” it provided to one of its executives to exercise options.
NSL (ASX:NSL) agreed to provide CEO Cedric Goode and COO Sean Freeman with “financial assistance” back in December 2016 to convert options that were expiring into shares.
The monetary value of the combined loan was $957,000, though no actual funds were provided by the company.
Mr Freeman has now repaid his share of the loan amount: $479,650, which includes the original loan sum of $452,500 plus interest.
Mr Goode repaid $522,958, including the original loan amount of $505,000 plus interest, in mid-August — five months earlier than expected.
NSL said at the time that significant interest from its top 10 shareholders and further support by the board facilitated the early repayment of the loan via the off-market acquisition of shares by Mr Goode.
Between them, Mr Goode and Mr Freeman acquired nearly 100 million shares at 0.96c each by exercising their options.
At the time, the options were “in the money” with NSL’s share price trading at almost 4c.
Since then, the company’s market value has slipped back 51.3 per cent, with the share price last trading at around 1.9c.
NSL is involved in iron ore production in India and thermal coal exploration in Australia.
The company recently reached design capacity for phase two of its 200,000-tonne-per-annum Kurnool iron ore beneficiation plant. A third phase is expected to double plant capacity to 400,000 tonnes per annum of concentrate.
However, NSL is facing some legal woes regarding its four coal licences in Queensland. The seller of the licences alleges that NSL has failed to meet various obligations under the acquisition agreement.
The trial concluded in August and the company is waiting to find out the Supreme Court verdict.