Sarama Issues 16.5 Million Performance Shares to Directors and CFO

Equity Incentives Linked to Arbitration Progress

Sarama Resources Ltd (ASX:SRR) has handed out 16.5 million Performance Share Units (PSUs) to its directors and Chief Financial Officer as part of a broader strategy to align remuneration with the company’s ongoing arbitration against the Government of Burkina Faso. The CFO received 1.5 million PSUs outright, while 15 million PSUs granted to directors await shareholder approval at the upcoming Annual General Meeting in October 2026.

The equity awards are structured under Sarama’s Equity Incentive Plan, approved by shareholders in late 2022, and are explicitly designed to compensate for the substantial increase in board responsibilities tied to the arbitration process. This includes overseeing litigation strategy, funding decisions, risk management, and corporate strategy adjustments, tasks that stretch well beyond the usual scope for a junior mining company’s board.

Vesting Conditions Reflect Arbitration Milestones

The PSUs vest in two equal tranches of 50% each, contingent on both retention and key arbitration milestones. The first tranche vests on the announcement of a ruling from the International Centre for Settlement of Investment Disputes (ICSID) regarding the arbitration, expected anytime between August 2027 and August 2031. The second tranche vests upon the announcement of receipt of any arbitral award funds within the same timeframe.

This vesting structure underscores the company’s focus on long-term retention and incentivising directors to see the arbitration through to tangible outcomes. The awards also serve as a mechanism to reduce cash burn, with directors agreeing to fix their cash fees and accept PSUs in lieu of additional annual equity grants. This approach reflects the financial pressures Sarama faces while pursuing its US$242 million arbitration claim, which has already influenced recent capital management decisions.

Board Continuity and Strategic Oversight Amid Arbitration

Given the complexity and significance of the arbitration, Sarama’s board requires directors with substantial legal, commercial, and capital markets experience. The company emphasises that the arbitration demands far greater oversight and governance than typical for a junior explorer, necessitating a stable and experienced board. The PSUs are part of a broader effort to retain this continuity and ensure the board remains fully engaged through potentially protracted proceedings.

These developments come on the heels of Sarama’s recent asset sales and capital raises designed to bolster its financial position while advancing the arbitration claim. Notably, the company completed the sale of its Western Australian gold projects to Riedel Resources, securing both cash and equity stakes to support ongoing operations and litigation efforts. The arbitration hearing itself is anticipated in early 2027, making the timing of these equity incentives particularly relevant.

Shareholders will have the final say on the director PSUs at the AGM, a vote that could shape Sarama’s governance and financial strategy through the arbitration’s critical phases.