INVICTUS Energy, the Australia listed junior miner developing Zimbabwe’s potential maiden oil and gas mine, has offered two key directors shares to incentivise their performance, as it seeks to navigate an important stage of the Muzarabani project development and growth of the company.
It is expected the successful discovery of oil and gas in the Cahorra Bassa Basin of Muzarabani will be a game-changer for Zimbabwe in terms of job creation, energy self-sufficiency, downstream industries, exports and development of the project area.
Working with Government, Invictus is at a stage where it is also in discussions with the Government for production sharing agreement and the crafting of legislation that fills voids in the current Petroleums Act.
Oil and gas can be major contributors to national gross domestic product accounting for almost the entire national budgets in countries like Angola, Saudi Arabia, Libya, Venezuela, Iran, Iraq and the UAE.
The Australia Stock Exchange (ASX) listed oil and gas company has since issued 11,8 million class A and B shares to directors Scott MacMillan and Stuart Lake, subject to shareholder approval and attainment of key performance milestones.
Invictus said was at an important stage of development with significant opportunities and challenges in both the near and long-term and the proposed issue seeks to align the efforts of the directors in seeking to achieve growth of the share price and the creation of shareholder value.
Essentially, the performance milestones are defined by agreements for exploration and drilling for oil and gas on the Muzarabani prospect and the firm’s stock reaching a certain level of share price performance.
“In addition, the board company also believes that incentivising Mr. Scott Macmillan and Dr. Stuart Lake with Performance Rights is a prudent means of conserving the Company’s available cash reserves.
“The board company believes it is important to offer these performance rights to continue to attract and maintain highly experienced and qualified Board members in a competitive market,” Invictus said.
The issue of the performance rights forms a part of the revised remuneration package agreed with each of Macmillan and Lake.
If shareholder approval for the issue of the performance rights is not obtained, and in the event the milestones are satisfied, the directors will be paid the equivalent value of the shares that would have vested at the point the milestones are met.
For instance, MacMillan will receive cash payment of US$75 000 cash in lieu of shares for each of the class A and class B shares if the performance milestones are achieved.
“In addition, it has also been agreed that Mr. Macmillan will receive 10 percent of the total costs reimbursed to Invictus for sunk and historical costs, by a reputable partner, in connection with a binding farm-in agreement or non-binding farm-in agreement up to a maximum of US$250 000,” Invictus said.
The performance rewards will fall due upon company announcing the execution of the non-binding farm-in agreement on or before December 31, 2020, and the binding farm-in agreement, having been executed, becomes unconditional on or before June 30, 2021.
Binding farm-in agreement means a legally binding farm-in agreement between the company and a reputable partner in respect of the Cabora Bassa Project, which more fully reflects the terms of the non-Binding farm-in agreement.
The non-binding farm-in agreement” means a non-binding farm-in agreement between the company and a reputable partner, which provides for the indicative commercial terms for a farm-in agreement in respect of the Cabora Bassa Project (Muzarabani) and which provides for a commitment to drill at least one well on its Special Grant Permit 4571.
For Class B Share, the shares will or incentive pay will become vesting upon the company achieving the grant of the extension application on or before December 31, 2020.
With regards share price performance of Class A shares, the rewards will become vesting on the date the company achieves a volume-weighted average price (VWAP) of at least $0,045 (Australian dollar) over any twenty consecutive trading day period before December 31, 2020.
For Class B shares, the rights will take effect upon the company achieving a VWAP of at least $0,045 over any twenty consecutive trading day period before December 31, 2020.
The Cabora Bassa Project encompasses the Mzarabani Prospect, a multi-trillion cubic feet and liquids-rich conventional gas-condensate target, which is potentially the largest, undrilled seismically defined structure onshore Africa_Business Weekly
