2008 Annual report - Sappi

Notes to the group annual financial statements // continued
for the year ended September 2008
28. Post-employment benefits other than pensions (continued)
Aggregate total of present value of the defined benefit obligation in the post retirement medical plans for the current annual
period and for the previous four annual periods (ignoring unrecognised adjustments):
2008 2007 2006 2005 2004
Defined benefit obligations 143 173 164 178 172
Aggregate gains and losses arising on plan liabilities for the current annual period and previous four annual periods:
2008 2007 2006 2005 2004
Plan liabilities gains (losses) 23 – (1) – (8)
29. Share-based payments
The Sappi Limited Share Incentive Trust and The Sappi Limited Performance Share Incentive Trust
At the annual general meeting of shareholders held on 7 March 2005, shareholders adopted The Sappi Limited Performance
Share Incentive Trust (Plan) in addition to The Sappi Limited Share Incentive Trust (Scheme) which had been adopted on
5 March 1997, and fixed the aggregate number of shares which may be acquired by all participants under the Plan together
with the Trust at 19,000,000 shares, which constitute 7.9% of the issued share capital of Sappi Limited.
The Sappi Limited Share Incentive Trust (Scheme)
Under the rules of the Scheme, participants may be offered the opportunity to acquire ordinary shares (Scheme shares). This
entails that Scheme shares are sold by the Scheme to participants on the basis that ownership thereof passes to the
participant on conclusion of the contract but the purchase price is not payable immediately. Scheme shares are registered
in the name of the participants and will be pledged in favour of the Scheme as security for payment of debt. Subject to
certain limitations, a participant’s outstanding share debt will bear interest at such rate as determined by the board of
directors. Dividends on Scheme shares are paid to the Scheme and will be applied in the payment of such interest. Scheme
shares may only be released to participants as described below.
Under the rules of the Scheme, participants may be offered options to acquire ordinary shares (Share options). This entails
that employees are offered options to purchase or subscribe for shares. Each share option will confer to the holder the right
to purchase or subscribe for one ordinary share. This is based on the terms and conditions of the Scheme. Share options
may only be released to participants as described below.
Under the rules of the Scheme, participants may be granted options to enter into agreements with the company to acquire
ordinary shares (Allocation shares). These options need to be exercised by the employee within 12 months, failing which the
option will automatically lapse. The exercise of the option must be accompanied by a deposit (if any) as determined by the
board of directors of Sappi (the board). The participant will be entitled to take delivery of and pay for Allocation shares which
are subject to the rules as described below.
Certain managerial employees are eligible to participate in the Scheme. The amount payable by a participant for Scheme
Shares, Share Options or Allocation Shares is the closing price at which shares are traded on the JSE Limited on the trading
date immediately preceding the date upon which the board authorised the grant of the opportunity to acquire relevant
Scheme Shares, Share Options or Allocation Shares, as the case may be, to a participant. Pursuant to resolutions of the
board passed in accordance with the rules of the Scheme, Scheme Shares may be released from the Scheme to participants,
Share Options may be exercised by participants and Allocation Shares may be delivered to participants as follows for
allocations prior to November 2004:
(i) 20% of the total number of shares after one year has elapsed from the date of acceptance by the participant of the grant;
(ii) up to 40% of the total number of shares after two years have elapsed from the date of acceptance by the participant of
the grant;
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