Three directors sold twenty million shares. The chairman and the chief executive have gone, the rules that let it happen have been rewritten, and one of the sellers is still on the board.
Peter Switzer put it to DroneShield’s investor relations chief directly on this week’s Switzer Show: what would you say to people who lost confidence in the company after directors sold out?
“Obviously that is a factor that we are aware of,” Joshua Bolot said. “I think what they can look at is what we’ve done in the last six months in uplifting our policies and procedures, in investing and improving and adding further depth to our board.”
After all has been said and done, here’s what has actually changed, according to DroneShield.
What went wrong?
In early November 2025, performance options covering 44.5 million shares vested after DroneShield hit a rolling twelve-month revenue target of $200 million, a hurdle set in early 2024 when revenue was about $54 million. The trading window opened on 6 November.
Between 6 and 12 November, three directors sold a combined 19.95 million shares: chief executive Oleg Vornik 14,806,833, an entity associated with chairman Peter James 3,685,345, and director Jethro Marks 1,460,000.
The shares fell from $3.85 to $3.40 the day the window opened.
After the sales were disclosed they fell from $3.28 to an intraday $2.20, and closed at $2.25 on 13 November, down 31 per cent. They bottomed at $1.625 later that month.
Complicating it, DroneShield had released an announcement on 10 November about “$7.6 million” of orders and withdrawn it the same day. The orders were reissued, not new; one had already been announced in September. The company called it an administrative error. Two of the three directors sold shares in the window between that announcement and its withdrawal.
The ASX asked a number of understandable questions. DroneShield answered them on 20 November, and disclosed that the trades had been notified within the five business days the listing rules require rather than the two days its own trading policy demanded.
The ASX then unexpectedly directed DroneShield, under listing rule 18.8, to publish the outcome of its governance review, citing concerns about the adequacy of its continuous disclosure arrangements and its trading policy.
The review, run by Herbert Smith Freehills Kramer and overseen by independent directors Simone Haslinger and Richard Joffe, reported on 25 February. It found the obvious thing. Under the old trading policy a director needed the chairman’s approval to sell, and the chairman needed the managing director’s. Peter James and Oleg Vornik could approve each other.
What has been fixed?
Under a new policy adopted on 25 February, the chief executive or chairman must be approved by the full board, and any other director by the chairman plus one independent director. Sales above 10 per cent of a holding need prior board approval. Trades must be notified by close of business on the day. Blackouts now run from each period end to the day after results.
The board has turned over. Angus Bean replaced Vornik as chief executive on 8 April, and Vornik left the board the same day. James retired at the annual meeting on 29 May, replaced as chairman by Hamish McLennan. Retired Rear Admiral Lee Goddard CSC joined on 1 July. Neither DroneShield’s announcement nor either man’s own statement links their departure to November.
But it hasn’t been without incident or dissent along the way.
The remuneration report received a first strike at the May annual meeting, with 50.51 per cent of votes cast against it. Chief executive Angus Bean’s performance options passed with 55.8 per cent support.
The minimum shareholding policy, the headline commitment from the review, has been softened. In February DroneShield said its chief executive would hold shares worth 200 per cent of salary within twelve months. The policy as adopted on 7 August gives him three years.
What’s still ongoing?
ASIC is still investigating. DroneShield disclosed on 12 May that it had received a notice requiring assistance with an investigation into “announcements and information provided to the Australian Securities Exchange between 1 and 20 November 2025, and trading in DroneShield shares between 6 and 12 November 2025”.
Its half-year accounts in August carry it as a contingent liability, with the company “unable to determine whether any obligation exists”. The episode has cost $8.7 million in what DroneShield calls business disruption and continuity costs.
Jethro Marks, who sold 1.46 million shares that November, remains on the board.
