10 April 2024
Zephyr Energy plc
("Zephyr" or the "Company")
Grant of share options and issue of
warrants
Zephyr Energy plc (AIM: ZPHR) (OTCQB: ZPHRF), the
Rocky Mountain oil and gas company focused on responsible resource
development from carbon-neutral operations, announces that the
Company has granted options over new ordinary shares of 0.1p each
in the Company (the "Ordinary Shares") under the Company's share
option schemes (the "Options").
A total of 61,503,028 Options, representing
approximately 3.65 per cent. of the Company's issued share capital,
have been issued to the directors, certain employees, and a
consultant of Zephyr either to reflect historic awards under the
Company's Long Term Incentive Plan ("LTIP"), bonuses for
performances achieved in 2021 and 2022 (the "Bonus Scheme"), to
satisfy employee contractual commitments or commitments in lieu of
deferred remuneration from 2020 during the COVID-19 pandemic.
Due to the Company's significant corporate activity
over the last several years, it has not been possible to issue the
Options until now, although the majority of the Options being
granted today have been previously disclosed and provided for in
the Company's historical financial statements. No bonuses of any
kind have been paid to any of the Company's directors in respect of
the 2023 financial year.
The Bonus Scheme and the LTIP were created in
conjunction with a remuneration study (the "Independent
Remuneration Study") commissioned by Zephyr's Remuneration
Committee (the "RemCom") in mid-2021. The schemes were further
developed by a specialist third party remuneration consulting firm
and were designed to establish a remuneration strategy which offers
management incentives broadly in line with those of AIM market
industry peers
The Company has consulted with its major shareholders
who have indicated their support in respect of the grant of the
Options.
Where applicable, the Options and warrants being
issued today have been done so using existing share authorities
granted to Zephyr's board of directors (the "Board") at the
Company's annual general meeting held on 26 July 2023.
LTIP Plan
Of the total number of Options granted, 15,667,200
have been issued to the executive directors and a senior employee
under the Company's LTIP (the "LTIP Options") in respect of the
2021 and 2022 financial years (and as agreed in principle by RemCom
at that time). The LTIP Options have been issued as "nil cost"
options exercisable at the nominal value of an Ordinary Share,
being 0.1p (the "Nil Cost Options").
The LTIP Options only vest subject to the achievement
of agreed corporate targets (including total shareholder return,
health and safety, and operational targets) as determined by
RemCom. Notwithstanding the LTIP Options being granted today, the
LTIP Options were intended to be granted in the first quarter
following the end of each financial year and accordingly, vest in
three equal tranches on the first, second and third anniversary
from the originally intended date of grant.
Given the Company's inability to grant historic
options until now, RemCom has been tracking performance and vesting
criteria until the LTIP Options could be formally granted.
Therefore, 2,000,177 LTIP Options vest on the first, second
and third anniversary in respect of the 2021 financial year.
3,222,222 LTIP Options vest on the first, second and third
anniversary in respect of the 2022 financial year.
None of the 2021 and 2022 LTIP Options in
respect of the 2023 financial year have vested due to the
performance related vesting criteria for the period not having been
met. In addition, there will be no LTIP Options granted in respect
of the 2023 financial year.
Bonus
Scheme
10,609,179 Options have been issued as Nil Cost
Options in respect of bonuses of executive directors and other
employees for the financial years ended 31 December 2021 and 2022,
which at a meeting in February 2022, RemCom agreed in principle to
pay in equity with the number of Nil Cost Options issued calculated
at the respective year end share prices of 6.95p and 6p. These Nil
Cost Options were agreed as part of the new remuneration strategy
approved by RemCom in September 2021, arising from the Independent
Remuneration Study.
783,908 Options have been issued as a sign-on bonus
to an employee who joined the Company in 2022 to fulfil contractual
obligations under the individual's employment contract.
Reimbursement of
deferred salaries from 2020
A further 30,998,645 Nil Cost Options have been
granted today as payment in equity in respect of salaries
voluntarily deferred by the Board and other employees during the
COVID-19 pandemic (the "Deferred Remuneration Options"). A portion
or an entirety of the salaries of all directors and certain
employees and consultants were deferred from April 2020 to
September 2020 to preserve the Company's very limited cash
resources at that time during the uncertain conditions caused by
the COVID-19 pandemic.
In early October 2020, RemCom agreed to compensate
the deferred salaries by the issue of equity, calculated as
accruing monthly for each month of deferral at the volume weighted
average share price of that month. As stated in the Company's 2020,
2021 and 2022 annual reports, it was intended that these deferred
salaries would be paid by way of the issue of Nil Cost Options and
accordingly, the amounts have since accrued in the Company's
accounts. However, the issue of the Deferred Remuneration Options
has not been possible until now due to ongoing corporate
activity.
Payment of
third-party legal fees
Finally, a further 3,444,095 Nil Cost Options have
been granted today as payment in equity in respect of third-party
legal fees incurred by the Company. These Nil Cost Options have
been issued to an employee, who was previously a contractor to the
Company, in respect of payment for historic work carried out prior
to the contractor joining the Company.
All the Nil Cost Options can be exercised for a
period of ten years or within three years of an Option holder
leaving the Company, unless otherwise agreed by the
Company.
Director interests
Of the total Options issued today, 18,760,137 have
been issued to employees and consultants of the Company and
42,742,891 have been issued to the directors of the Company as set
out below:
Name of Director
|
Number of Nil Cost Options granted
|
New Nil Cost Options as percentage of issued
share capital
|
Total number of share options now
held
|
Total number of share options held as
percentage of issued share capital
|
Colin Harrington
|
26,601,988
|
1.58%
|
38,601,988
|
2.29%
|
Chris Eadie
|
10,447,898
|
0.62%
|
18,347,898
|
1.09%
|
Rick Grant
|
2,349,545
|
0.14%
|
6,702,908
|
0.40%
|
Gordon Stein
|
1,671,730
|
0.10%
|
4,217,185
|
0.25%
|
Tom Reynolds
|
1,671,730
|
0.10%
|
4,489,911
|
0.27%
|
The Options granted today represent
approximately 3.65 per cent. of the Company's current issued share
capital. In total 106,534,360 options over Ordinary Shares are now
outstanding, representing approximately 6.32 per cent. of the
Company's current issued share capital.
Issue of warrants
In lieu of services provided, the Company has issued
2,597,143 warrants to a third-party contractor enabling the
contractor to acquire up to 2,597,143 new Ordinary Shares in the
Company at a price of 4.375p per new Ordinary Share. The warrants
can be exercised at any time prior to 12 June 2026.
Extension of
warrants
On 29 March 2021, the Company announced, inter alia, that it had issued its
broker, Turner Pope Investments ("TPI"), 32,500,000 warrants to
subscribe for up to 32,500,000 new Ordinary Shares (the "broker
warrants"). The broker warrants were issued as part of TPI's fees
for work undertaken in relation to the Company's placing of
ordinary shares announced at the time. The broker warrants are
exercisable at a price of 3p per new Ordinary share and were valid
until 15 April 2024. The Board has now agreed to extend the expiry
date of these warrants to 15 April 2026.
Contacts:
Zephyr Energy
plc
Colin Harrington (CEO)
Chris Eadie (Group Finance Director)
|
Tel: +44 (0)20 7225
4590
|
Allenby Capital
Limited - AIM Nominated Adviser
Jeremy Porter / Vivek Bhardwaj
|
Tel: +44 (0)20 3328
5656
|
Turner Pope
Investments - Joint-Broker
James Pope / Andy Thacker
Panmure Gordon (UK)
Limited - Joint-Broker
Hugh Rich / James Sinclair-Ford
Celicourt
Communications - PR
Mark Antelme / Felicity Winkles / Ali AlQahtani
|
Tel: +44 (0)20 3657
0050
Tel: +44 (0) 20 7886
2500
Tel: +44 (0) 20 8434
2643
|
Notes to
Editors
Zephyr Energy plc (AIM: ZPHR) (OTCQB:
ZPHRF) is a technology-led oil and gas company focused on
responsible resource development from carbon-neutral
operations in the Rocky Mountain region of the
United States. The Company's mission is rooted in two core
values: to be responsible stewards of its investors' capital, and
to be responsible stewards of the environment in which it
works.
Zephyr's flagship asset is an operated 46,000-acre
leaseholding located in the Paradox Basin, Utah, 25,000
acres of which has been assessed to hold, net to Zephyr, 2P
reserves of 2.6 million barrels of oil equivalent ("mmboe"), 2C
resources of 34 mmboe and 2U resources 270 mmboe.
In addition to its operated assets, the Company owns
working interests in a broad portfolio of
non-operated producing wells across the Williston
Basin in North Dakota and Montana. Cash flow
from the Williston production will be used to fund the
planned Paradox Basin development. In addition, the Board
will consider further opportunistic value-accretive
acquisitions.
Notification
and public disclosure of transactions by persons discharging
managerial responsibilities and persons closely associated with
them:
1.
|
Details of the person discharging managerial responsibilities
/ person closely associated
|
a)
|
Name
|
PDMRs:
Colin Harrington
|
Chief Executive Officer
|
Chris Eadie
|
CFO
|
Rick Grant
|
Non-Executive Chairman
|
Gordon Stein
|
Non-Executive Director
|
Tom Reynolds
|
Non-Executive Director
|
|
2.
|
Reason for the Notification
|
a)
|
Position/status
|
See 1 a) above
|
b)
|
Initial
notification/Amendment
|
Initial notification
|
3.
|
Details of the issuer, emission allowance market participant,
auction platform, auctioneer or auction monitor
|
a)
|
Name
|
Zephyr Energy plc
|
b)
|
LEI
|
254900TAVH3MBZ1EMC29
|
4.
|
Details of the transaction(s): section to be repeated for (i)
each type of instrument; (ii) each type of transaction; (iii) each
date; and (iv) each place where transactions have been
conducted
|
a)
|
Description of the Financial
instrument, type of instrument
|
Ordinary shares of 0.1p each
in Zephyr Energy plc
|
Identification code
|
GB00BF44KY60
|
b)
|
Nature of the transaction
|
Grant of Nil Cost Options
|
c)
|
Price(s) and volume(s)
|
Price: 0.1p
Volumes:
Colin Harrington
|
26,601,988
|
Chris Eadie
|
10,447,898
|
Rick Grant
|
2,349,545
|
Gordon Stein
|
1,671,730
|
Tom Reynolds
|
1,671,730
|
|
d)
|
Aggregated information:
·Aggregated volume
·Price
|
N/A
|
e)
|
Date of the transaction
|
10 April 2024
|
f)
|
Place of the transaction
|
Outside a trading venue
|