11.1m options with a 6c exercise price were issued as part of BET's employee incentive scheme back in Aug 2019 (when the SP was 6c). The announcement says Henson and Pullin (Key Management Personnel) were issued with 5.5m options. No details of other staff who received the 5.6m option balance and converted them to shares.
All of these options were exercised on 20/12/2022 and converted into shares as follows:
The option holders paid $90,000 (1.5m times by 6c) to BET to exercise 1.5m options and BET issued the option holders 1.5m shares.
The remaining 9.6m options were exercised via a cashless mechanism which is permitted in BET's long term incentive plan (this is fairly standard). I believe this means that instead of the option holders paying cash to convert their options into shares, the Company calculates the net value of the options when they are due to be converted (calculated as the SP at conversion (this may be a VWAP in the lead up to the conversion date) minus the option price times by the number of vested options to be exercised) and converts the net option value into shares. In order to be applicable this cashless conversion method requires the SP to be greater than the option exercise price, which it is in this case.The cashless conversion calculation was approximately 28.14c (VWAP as at 20/12) minus 6c (option exercise price) = 22.14c times by 9.6m options = $2,125,739 (net value) divided by 28.5c (SP at 20/12 exercise date) = 7,458,735 shares issued cashless.
Total shares issued to holders of the 11.1m options is 1,500,000 (cash) + 7,458,735 (cashless) = 8,958,735 issued shares (as per the announcement).
Had the option holders paid 6c to convert all 11.1m options, BET would have received $666,000 cash from the option holders and BET would have issued the option holders 11.1m shares.If I have this wrong please advise the correct cashless conversion calculation.
BET Price at posting:
27.3¢ Sentiment: None Disclosure: Not Held
