SAPPI LIMITED

SAPPI
NOTES TO THE GROUP ANNUAL FINANCIAL STATEMENTS (Continued)
for the year ended September 2010
28. SHARE-BASED PAYMENTS (Continued)
The following table sets forth certain information with respect to the 1,087,200 Share options and
Performance shares granted by Sappi to executive directors:
Number of
options/ Exercise price
Issue date shares** Expiry date (ZAR)**
13 February 2003 ........... 33,000 13 February 2011 62.34
30 December 2003 .......... 39,600 30 December 2011 47.08
13 December 2004 .......... 39,600 13 December 2012 46.51
02 July 2007* .............. 220,000 02 July 2011 —
12 December 2007* .......... 198,000 12 December 2011 —
22 December 2008* .......... 242,000 13 December 2012 —
09 December 2009* .......... 315,000
1,087,200
09 December 2013 —
* Performance shares.
** Adjusted for the Share options, Restricted shares and Performance shares granted as a result of the rights issue.
No new loans have been granted to the executive directors since 28 March 2002.
BEE Transaction
In June 2010, Sappi completed a Broad Based Black Economic Empowerment (‘‘BBBEE’’)
transaction (the ‘‘BEE Transaction’’). The South African government has through the years promulgated
various pieces of legislation to increase the participation of Historically Disadvantaged South Africans
(‘‘HDSAs’’) in the South African economy and, through BBBEE legislation, formalised the country’s
approach in this regard.
In April 2006, Sappi announced a BEE transaction (the ‘‘Plantation BEE Transaction’’) with Lereko
Property Company (Proprietary) Limited (‘‘LPC’’), a BEE company set up to house a consortium
consisting of Lereko Investments (Proprietary) Limited (‘‘Lereko Investments’’), AMB Capital Limited
(‘‘AMB Capital’’) and Malibongwe Women Development Trust (‘‘Malibongwe’’) (collectively, the
‘‘Strategic Partners’’), pursuant to which LPC acquired a 25% undivided share in Sappi’s South African
plantation land, excluding the value of the plantations, owned by Sappi and/or Sappi Manufacturing,
coupled with the right to develop the land not utilised for forestry operations. Sappi Manufacturing
retained the right of use over all the land under the underlying arrangements. As part of the Plantation
BEE Transaction, 30% of LPC was set aside for the benefit of certain categories of Sappi’s South African
employees who did not participate in any Company share incentive scheme. The balance of the
shareholding in LPC was to be held by Lereko Investments (46.19%), Malibongwe (10.14%) and AMB
Capital (13.67%).
However, the Plantation BEE Transaction did not meet Sappi’s undertakings under the Forestry
Charter gazetted in June 2009 (which sets the objectives and principles for BBBEE in the forestry
industry and includes the BBBEE scorecard and targets to be applied, as well as certain undertakings by
government and South African forestry companies to assist the forestry industry to achieve its BBBEE
targets). Accordingly, Sappi decided to unwind the Plantation BEE Transaction, which resided at a South
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