Our performance in 2009 - Sappi

29. Share-based payments continued
The Sappi Limited Share Incentive Trust (the Scheme) continued
2009 annual report
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;
(iii) up to 60% of the total number of shares after three years have elapsed from the date of acceptance by the participant
of the grant;
(iv) up to 80% of the total number of shares after four years have elapsed from the date of acceptance by the participant of
the grant; and
(v) the balance of the shares after five years have elapsed from the date of acceptance by the participant of the grant;
and for allocations subsequent to November 2004 as follows:
(i) 25% 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 50% of the total number of shares after two years have elapsed from the date of acceptance by the participant of
the grant;
(iii) up to 75% of the total number of shares after three years have elapsed from the date of acceptance by the participant
of the grant; and
(iv) the balance of the shares after four years have elapsed from the date of acceptance by the participant of the grant;
provided that the board may, at its discretion, anticipate or postpone such dates. Prior to the annual general meeting held
on 02 March 2000, the Scheme provided that Share options will lapse, among other reasons, if they remain unexercised
after the tenth anniversary of the acceptance and that Scheme shares and Allocation shares must be paid for in full by
participants by no later than the tenth anniversary of the acceptance. However, the annual general meeting approved an
amendment to decrease the aforesaid ten-year period to eight years, in respect of offers made since 03 December 1999.
The board has resolved that the benefits under the Scheme of Participants will be accelerated in the event of a change of
control of the company, as defined in the Scheme, becoming effective (a) if, in concluding the change of control, the board
in office at the time immediately prior to the proposed change of control being communicated to the board ceases to be
able to determine the future employment conditions of the group’s employees or (b) unless the change of control is initiated
by the board. Participants are entitled to require such acceleration by written notice to the company within a period of
90 days after the date upon which such change of control becomes effective.
The Scheme provides that appropriate adjustments are to be made to the rights of Participants in the event that the group,
inter alia, undertakes a rights offer, a capitalisation issue, or consolidation of ordinary shares or any reduction in its ordinary
share capital.
The Sappi Limited Performance Share Incentive Trust (the Plan)
Under the rules of the Plan, participants who will be officers and other employees of the company may be awarded
conditional contracts to acquire shares for no cash consideration. If the performance criteria from time to time determined
by the human resources committee or compensation committee of the board (Performance Criteria) applicable to each
Conditional Contract, are met or exceeded, then Participants shall be entitled to receive such number of shares as specified
in the Conditional Contract for no cash consideration after the fourth anniversary of the date on which the board resolves to
award a Conditional Contract to that Participant. The Performance Criteria shall entail a benchmarking of the company’s
performance against an appropriate peer group of companies.
If the board determines that the Performance Criteria embodied in a Conditional Contract have not been satisfied or
exceeded, the number of shares to be allotted and issued and/or transferred to a Participant under and in terms of such
Conditional Contract shall be adjusted downwards.
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financials