Ann: Market Update, page-16

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Jacko22

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06/05/20

10:45

Post #: 44458657
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Originally posted by RED328: ↑

Hi All
I have been through this with the Ardea Resources Loyalty Option effort.
Firstly the registry date is on the 5th June and the strike price to convert then to a share will be $0.20c each.
Every shareholder that owns shares in GRL on the 5th will qualify for the options in a ratio of 1 for 3 held.
For every 3 shares you own you will be given 1 option with a validity of 24 months at $0.20c each, convertible at any time.

Now for my take on this (Full disclosure)I did very well out of my allocation of Loyalty Options in ARL, I did convert all of them to shares, no regrets, I am a long term holder and I still own them.
Subsequently to the completion of the 12 month option offer at ARL, the nickel price collapsed and China was mucking around with the nickel price and amongst other things Covid19 visited. Resulting in the ARL share price pull back to below the option strike price, my options became negatively valued. It was purely my choice to continue to hold being a long term investor.

Management have set the strike price at 0.20c and I feel this is fair under the current climate.
Management have extended the offer timeframe, which is a great bonus for shareholders, my reasoning is that the GRL share price will be well north of 0.20c by June 2022 and the options will be well and truly in the money.

Benefits for GRLI noticed that the options in ARL were converted steadily over the option live period, mostly towards the end though.
That they were converted in batches, as and when there were enough to warrant the cost of allocation.
Every time someone converted their options the company effectively recieved a raise in capital, this steady income stream funded the company and maintained a financial surplus, eliminating the need for a traditional capital raise.

The Loyalty Options were a WIN WIN The company received income over the period of the options.
The shareholder got to buy cheap shares, below market value.
Shareholders got to partake in raising capital and did not suffer with dilution as a result.
Shareholders got to choose the timing of their investment, allowing for them to plan and budget the expense in advance

Now for my take on the recent developments at GRL.I think that our Director Ian Buchhorn has stepped in, subsequently to our change in 2 positions at the top.
I see the signature moves that previously happened in ARL now taking place in GRL and this is a very good development IMO
- Like Loyalty Options now underway with clear information and timeline
- Like Director pay cuts at the top sending a signal that we as directors care, understand and are committed.
- I think we can expect a more regular news flow in future.
- I think we can expect innovative progression on our NSW resources

I am sure we will see a very tight control on finances and innovative cost saving measures implemented.
RED

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Hi Red, Long time reader and also an ARL holder...Just to add to your post, ARL also had a capital raise 3 months after issuing the bonus shares. There was a sophs raise at $0.725 in Aug 2017 which raised something like $5.5m (7.6m shares issued) and then a SPP at .725 in Sept 17 which raised another $4.4m (6m shares issued).
Given the similarities with ARL, and the fact GRL held off on announcing the loyalty options hoping (my opinion) for a higher SP, I'd expect another raise to build the coffers to last the 2 years before options expire.
J22

GRL Price at posting: 14.0¢ Sentiment: Buy Disclosure: Held
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Last 1.7¢		Change 0.003(21.4%)		Mkt cap ! $5.375M

Open	High	Low	Value	Volume
1.6¢	1.8¢	1.6¢	$94.18K	5.740M

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No.	Vol.	Price($)
4	637000	0.015
3	450000	0.014
6	2470339	0.013
2	1076999	0.012
4	659905	0.011

Price($)	Vol.	No.
0.017	399999	1
0.018	112683	1
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