Environmental Clean Technologies Grants 3.5 Million Unlisted Performance Rights to Non-Executive Director

Performance Rights Issued as Part of Director Remuneration

Environmental Clean Technologies Limited has granted 3.5 million unlisted performance rights to a Non-Executive Director as partial consideration for services rendered, with the issuance occurring on 22 July 2026. This non-cash transaction involves unquoted securities that are not traded on the ASX and form part of the company’s unlisted equity portfolio.

Utilising performance rights for director compensation is a common practice among Australian public companies, aligning board members’ interests with shareholder value while conserving cash. This issuance reflects ECT’s remuneration strategy, which blends cash and equity-based incentives. The unlisted performance rights are subject to specific terms dictating their vesting and conversion into ordinary shares.

Link to March 2026 Placement Transaction

The 3.5 million performance rights issued in July 2026 relate directly to a placement transaction previously disclosed on 17 March 2026 via an Appendix 3B. This filing outlined a proposed securities placement by Environmental Clean Technologies. The July issuance confirms the completion of this capital raising activity.

ECT has stated that no additional securities issuances are necessary to finalise the March 2026 placement. This indicates the placement process has been fully settled with the recent performance rights issuance, providing transparency and continuity for investors tracking the company’s capital management.

Equity Structure and Capital Position of Environmental Clean Technologies

Following this issuance, Environmental Clean Technologies maintains a capital structure comprising 416.09 million ordinary fully paid shares, which trade on the ASX under the ticker ECT. The company also holds a significant portfolio of unquoted securities, including 88.67 million performance rights across various classes, with the recent 3.5 million rights adding to this total.

Additionally, ECT has nine classes of unquoted options outstanding, featuring exercise prices from $0.03 to $0.45 and expiry dates ranging from August 2026 to December 2028. This complex capital structure reflects the company’s historical financing and incentive arrangements.

Compliance and Regulatory Aspects of Unquoted Securities

The 3.5 million performance rights issued are classified as unquoted securities under ASX regulations and are not intended for public trading. This classification differs from the company’s quoted ordinary shares and entails specific disclosure, transfer, and holder notification requirements.

Issuing unquoted performance rights enables Environmental Clean Technologies to structure director remuneration flexibly, incorporating vesting conditions and performance criteria. The company has fulfilled its ASX disclosure obligations through an Appendix 3G filing, ensuring market transparency.

Director Incentive Alignment in the Clean Technology Sector

Granting performance rights to a Non-Executive Director aligns with common practices in environmental and technology sectors, where board members contribute specialist expertise and governance oversight. Equity-based compensation fosters alignment between directors’ interests and long-term shareholder value.

Performance rights vest upon achieving performance milestones, which may include operational, financial, or strategic targets set by the board. This approach supports performance-based governance and aligns incentives with company objectives.

Total Unquoted Securities and Potential Dilution

The issuance increases Environmental Clean Technologies’ total unquoted performance rights to 88.67 million, a substantial portion of the company’s equity alongside 416.09 million quoted shares. While conversion depends on meeting vesting conditions, investors should consider potential dilution from outstanding securities.

The company also holds 19.1 million unquoted options across nine classes, with the largest being ECTAN options (35 million) expiring on 23 December 2028 at an exercise price of $0.12. The aggregate unquoted securities represent potential future dilution contingent on exercise and performance outcomes.

Trends in Non-Executive Director Compensation Among ASX Companies

Using unlisted performance rights for Non-Executive Director remuneration reflects broader Australian corporate governance trends emphasizing equity incentives. Such arrangements typically combine base fees with equity awards to promote shareholder value focus.

Environmental Clean Technologies’ approach aligns with ASX Corporate Governance Council guidelines, ensuring director incentives correspond with shareholder interests while preserving company cash through non-cash compensation. These details are disclosed in remuneration reports and proxy materials.

Outlook for Environmental Clean Technologies Shareholders

With the July 2026 performance rights issuance, Environmental Clean Technologies has completed the placement transaction announced in March 2026. Shareholders should watch for updates on vesting conditions and performance milestones related to these rights in upcoming company disclosures.

Investors are encouraged to review the company’s remuneration disclosures in annual reports and proxy statements for detailed terms of the director performance rights. Future quarterly or half-yearly reports may provide insights into business performance and progress toward meeting performance criteria.