A couple of other points to note:1) Around 50% of the shares...

A couple of other points to note:

1) Around 50% of the shares sold relates to limited recourse loans (see Loan Funded Portion in the table below). This is where the company provided the directors with interest free loans to purchase shares. The average purchase price of these shares was between 35-38c (see table below). I remember one situation where Oleg purchased shares for 65c when the market price was closer to 20c via this loan facility. There is no risk to Oleg because the loan is limited recourse so the company can't recover the funds if Oleg chooses not to pay it (usually they would just return the shares if they didn't want to pay off the loan - which has happened with DRO before).

2) When these loans are setup no money changes hands and the company simply issues the shares (or options) and the loan is recorded as an asset on the balance sheet. This has the effect of increasing the fully diluted EV. Now that the shares have been sold the directors must pay back the loans which now means that around $3m is added to DROs cash position. In my case I always calculate fully diluted EV which takes into account all options and shares yet to be issued. This has the effect of reducing fully diluted EV slightly (by $3m).



This is just my understanding of the situation. Please feel free to correct me or add more detail to my explanation.

So effectively the directors had $2.9m of the loans against these shares that they can now pay off. They would need to declare these loans when attempting to obtain finance, so I guess part of the motivation here is to clean up their finances? Plus the shareholders in their wisdom decided to give them another 19.5m in performance rights (effectively replacing/refreshing the shares they just sold - almost exactly (see the FPO vs Performance Rights column above)).

Definitely not a good look that they are selling... but shareholders did encourage this behaviour by voting for the issue of such a large number of performance options (with revenue and not profit based targets).

Perhaps they are confident in achieving the performance targets (i.e. having their stack reloaded) but not so confident how the market will decide to value DRO in the future.

Also, as others have pointed out, they have performed coordinated selling many times in the past, and every time the share price has moved higher (usually shortly afterwards) and they have realised very poor value for their shares (compared to what they could have). It will be interesting to see how this one plays out.