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SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
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Republic
of South Africa
(State
or other jurisdiction of incorporation or organization)
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NONE
(I.R.S.
Employer Identification No.)
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Exhibit
Number
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Description
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4.1**
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Memorandum
and Articles of Association of the Company (incorporated by reference
to
Exhibit 1.1 to the Company’s Annual Report on Form 20-F for the fiscal
year ended September 28, 2003, filed December 19, 2003 (File No.
1-14872)).
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4.2**
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Specimen
Ordinary Share Certificate (incorporated by reference to Exhibit
2.1 to
the Company’s Registration Statement on Form 20-F filed October 22,
1998 (File No. 1-14872)).
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4.3*
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The
Sappi Limited Performance Share Incentive Plan.
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5**
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Opinion
of Werksmans Inc. as to the legality of the Ordinary
Shares.
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23.1**
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Consent
of Werksmans Inc. (included in Exhibit 5).
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23.2*
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Consent
of Deloitte & Touche.
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24**
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Powers
of Attorney.
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| SAPPI LIMITED |
| By | /s/ Donald Gert Wilson |
|
Title: Executive
Director - Finance
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Date: December 21,
2005
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Signature
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Title
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Date
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*
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Chief
Executive Officer and Director (Principal Executive
Officer)
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December 21,
2005
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||
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Jonathan
Leslie
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||||
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/s/
Donald Gert Wilson
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Executive
Director - Finance and Director
(Principal
Financial Officer and Principal Accounting Officer)
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December 21,
2005
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||
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Donald
Gert Wilson
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||||
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*
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Chairman
of the Board of Directors
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December 21,
2005
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||
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Eugene
van As
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||||
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*
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Director
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December 21,
2005
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||
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David
Charles Brink
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||||
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*
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Director
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December 21,
2005
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||
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Meyer
Feldberg
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||||
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*
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Director
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December 21,
2005
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||
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James
Edward Healy
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*
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Director
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December 21,
2005
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|||
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John
Leonard Job
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|||||
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*
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Director
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December 21,
2005
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|||
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Klaas
de Kluis
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|||||
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*
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Director
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December 21,
2005
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|||
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Deenadayalen
Konar
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|||||
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*
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Director
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December 21,
2005
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|||
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Helmut
Mamsch
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|||||
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*
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Director
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December 21,
2005
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|||
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Wolfgang
Pfarl
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|||||
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*
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Director
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December 21,
2005
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|||
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Bridgette
Radebe
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|||||
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*
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Director
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December 21,
2005
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|||
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Franklin
Abraham Sonn
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|||||
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*
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Authorized
Representative in the United States
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December 21,
2005
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|||
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Sarah
Manchester
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|||||
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*By:
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/s/
Donald Gert Wilson
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||||
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Donald
Gert Wilson
Attorney-in-Fact
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|||||
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Exhibit
Number
|
Description
|
|
4.1**
|
Memorandum
and Articles of Association of the Company (incorporated by reference
to
Exhibit 1.1 to the Company’s Annual Report on Form 20-F for the fiscal
year ended September 28, 2003, filed December 19, 2003 (File No.
1-14872)).
|
|
4.2**
|
Specimen
Ordinary Share Certificate (incorporated by reference to Exhibit
2.1 to
the Company’s Registration Statement on Form 20-F filed October 22,
1998 (File No. 1-14872)).
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|
4.3*
|
The
Sappi Limited Performance Share Incentive Plan.
|
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5**
|
Opinion
of Werksmans Inc. as to the legality of the Ordinary
Shares.
|
|
23.1**
|
Consent
of Werksmans Inc. (included in Exhibit 5).
|
|
23.2*
|
Consent
of Deloitte & Touche.
|
|
24**
|
Powers
of Attorney.
|
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PART
1 - INTRODUCTION
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1
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1
DEFINITIONS AND INTERPRETATION
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1
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2
PURPOSE
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6
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PART
2 - THE TRUST
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6
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3
CONSTITUTION OF TRUST
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6
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4
TRUSTEES
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6
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5
POWERS OF TRUSTEES
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8
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6
SECURITY
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9
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7
REMUNERATION OF TRUSTEES
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9
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8
DUTIES OF TRUSTEES
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9
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9
INDEMNITY AND LEGAL PROCEEDINGS
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10
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10
ACQUISITION OF SHARES BY THE TRUSTEES
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10
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11
FUNDING OF THE TRUST
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10
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12
MAXIMUM NUMBER OF SHARES WHICH MAY BE ACQUIRED BY
PARTICIPANTS
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11
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PART
3 - THE PERFORMANCE SHARE PLAN
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12
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13
CONDITIONAL CONTRACTS
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12
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14
PERFORMANCE SHARES
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13
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15
RESTRICTION
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14
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16
SHARE CERTIFICATES PURSUANT TO A CONDITIONAL
CONTRACT
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14
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PART
4 - GENERAL
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14
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17
TERMINATION OF EMPLOYMENT
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14
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18
LISTING, TAX, LEGAL REQUIREMENTS AND CASH
ALTERNATIVE
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16
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19
ADJUSTMENTS
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17
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20
SALE AND ASSIGNMENT
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18
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21
AMENDMENT OF THE PLAN
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18
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22
ADMINISTRATION
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19
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23
ANNUAL ACCOUNTS
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19
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24
STRATE
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19
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25
DISPUTES
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20
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26
PROFITS AND LOSSES AND TERMINATION OF THE PLAN
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22
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27
DOMICILIUM AND NOTICES
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22
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28
AMERICAN DEPOSITORY SHARES
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23
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29
COMPLIANCE
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24
|
| 1 |
DEFINITIONS
AND INTERPRETATION
|
| 1.1 |
In
this Deed, unless expressly stipulated to the contrary or unless
the
context clearly indicates a contrary intention, the following words
and
expressions shall bear the following meanings (and cognate words
and
expressions shall bear corresponding
meanings) -
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| 1.1.1 |
“Act” - the
RSA Companies Act 61 of 1973;
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| 1.1.2 |
“ADSs” - American
Depository Shares each of which represent one Share or the right
to
receive one Share. It is recorded that American Depository Shares
are
evidenced by American Depository Receipts (“ADRs”)
issued by the Bank of New York (“the
Depository”)
in terms of the provisions of the Amended and Restated Deposit Agreement,
dated 23 October 1993 and amended and restated as of
26 October 1999, between the Company, the Depository and all
owners from time to time of ADRs, as the same may be amended, modified
or
restated from time to time;
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| 1.1.3 |
“Allocation
Date” - the
date on which the Board resolves to award a Conditional Contract
to an
Eligible Employee;
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| 1.1.4 |
“Applicable
Laws” - all
and any -
|
| 1.1.4.1 |
statutes,
subordinate legislation and common
law;
|
| 1.1.4.2 |
regulations;
|
| 1.1.4.3 |
ordinances
and by-laws;
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| 1.1.4.4 |
directives,
codes of practice, circulars, guidance notices, judgements and decisions
of any competent authority,
|
| 1.1.5 |
“Arbitration
Act” - the
RSA Arbitration Act 42 of 1965;
|
| 1.1.6 |
“Board” - the
board of directors of the Company acting either itself or through
any
committee of its members appointed by it from time to time which
is
charged with the administration of the
Plan;
|
| 1.1.7 |
“Change
of Control” - means -
|
| 1.1.7.1 |
all
circumstances where a party (or parties acting in concert), directly
or
indirectly, obtains -
|
| 1.1.7.1.1 |
de
facto control of the Company; or
|
| 1.1.7.1.2 |
beneficial
ownership of the specified percentage or more of the Company’s issued
Shares; or
|
| 1.1.7.1.3 |
control
of the specified percentage or more of the voting rights at meetings
of
the Company; or
|
| 1.1.7.1.4 |
the
right to control the management of the Company or the composition
of the
Board; or
|
| 1.1.7.1.5 |
the
right to appoint or remove directors holding a majority of voting
rights
at Board meetings; or
|
| 1.1.7.2 |
the
approval by the Company’s shareholders of, or the consummation of, a
merger or consolidation of the Company with any other business or
entity,
or upon a sale of the whole or a major part of the Company’s assets or
undertaking.
|
| 1.1.8 |
“Code” - the
Securities Regulation Code and Rules of the Securities Regulation
Panel,
promulgated under section 440C of the
Act;
|
| 1.1.9 |
“Company” - Sappi
Limited (registration number 1936/008963/06), a company incorporated
in
accordance with the laws of the
RSA;
|
| 1.1.10 |
“Conditional
Award” - an
award of a Conditional Contract made to an Eligible Employee pursuant
to
13.1
and 13.2;
|
| 1.1.11 |
“Conditional
Contract” - a
contract between the Company and a Participant which comes into existence
as a result of the acceptance by an Eligible Applicant of a Conditional
Award;
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| 1.1.12 |
“Date
of Termination of Employment” - the
earlier of the date on which -
|
| 1.1.12.1 |
the
contract of employment (whether oral or written) of a Participant
with a
Group Member is terminated; or
|
| 1.1.12.2 |
the
Participant leaves the service of a Group
Member;
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| 1.1.13 |
“Deed” - this
Deed, as amended from time to time;
|
| 1.1.14 |
“Eligible
Employee” - an
officer or other employee of a Group Member (including any director
holding salaried employment or
office);
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| 1.1.15 |
“Existing
Plan” - the
Sappi Limited Share Incentive Scheme adopted by the Company on
5 March 1997, as amended from time to
time;
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| 1.1.16 |
“Fair
Market Value” - in
relation to a Share on any particular day, shall be the closing price
at
which Shares are traded on the JSE on the trading day immediately
preceding such date; provided that if such trading day falls between
the
date on which the Company declared a dividend on its Shares and the
last
day for registration to participate in such dividend, the closing
price
shall be reduced by an amount equal to the amount of such
dividend;
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| 1.1.17 |
“Group” - the
Company and any other company, body corporate or other undertaking
which
is or would be deemed to be, a subsidiary of the Company in terms
of the
Act;
|
| 1.1.18 |
“Group
Member” - means
any company, body corporate or other undertaking which forms part
of the
Group;
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| 1.1.19 |
“JSE” - the
JSE Securities Exchange
South Africa;
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| 1.1.20 |
“Lawful
Dismissal for Operational Reasons” - the
dismissal of a Participant for Operational Reasons as contemplated
in the
LRA (more commonly referred to as retrenchment) or, insofar as a
Participant’s employment by any Group Member is not regulated by the LRA,
the dismissal of such Participant for analogous
reasons;
|
| 1.1.21 |
“LRA” - the
RSA Labour Relations Act 66 of
1995;
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| 1.1.22 |
“Participant” - an
Eligible Employee who has accepted a Conditional Award in terms of
13.3;
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| 1.1.23 |
“Performance
Criteria” - the
Performance Criteria from time to time determined by the Human Resources
Committee or Compensation Committee of the Board. It is recorded
that the
Performance Criteria shall benchmark the net return to shareholders
of the
Company against an appropriate “peer group” of companies from time to
time;
|
| 1.1.24 |
“Performance Shares” - shall
have the meaning ascribed thereto in 14.2;
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| 1.1.25 |
“Plan” - The
Sappi Limited Performance Share Incentive Plan, the terms of which
are
embodied in this Deed;
|
| 1.1.26 |
“Provisional
Shares” - the
maximum number of Shares provisionally awarded to a Participant in
terms
of a Conditional Contract, as contemplated in 13.1.3;
|
| 1.1.27 |
“RSA” - the
Republic of South Africa;
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| 1.1.28 |
“Secretary” - the
secretary for the time being of the
Company;
|
| 1.1.29 |
“Shares” - ordinary
shares with a par value of ZAR1 in the
Company;
|
| 1.1.30 |
“Tax
Act” - the
RSA Income Tax Act 58 of 1962;
|
| 1.1.31 |
“Taxes” - all
present and future taxes and other charges of any kind or nature
whatsoever imposed, levied, collected, withheld or assessed by any
competent authority, and includes all income taxes (whether based
on or
measured by income/revenue or profit of any nature or kind or otherwise
and whether levied under the Tax Act or otherwise), capital gains
taxes,
value-added taxes, stamp duties, uncertificated securities taxes
and all
charges in the nature of taxation, and all interest, penalties, fines
and
other payments on, or in respect
thereof;
|
| 1.1.32 |
“Trust” - The
Sappi Limited Performance Share Incentive Trust, constituted in terms
of
3;
|
| 1.1.33 |
“Trust
Act” - the
RSA Trust Property Control Act 57 of
1988;
|
| 1.1.34 |
“Trustees” - the
persons who are, from time to time, the Trustees of the Trust, initially
being those persons referred to in 4.2.
|
| 1.2 |
In
this Deed -
|
| 1.2.1 |
clause
headings are used for convenience only and shall be ignored in its
interpretation;
|
| 1.2.2 |
unless
the context clearly indicates a contrary intention, an expression
which
denotes -
|
| 1.2.2.1 |
any
gender includes the other genders;
|
| 1.2.2.2 |
a
natural person includes an artificial person (whether corporate or
unincorporate) and vice versa;
|
| 1.2.2.3 |
the
singular includes the plural and vice
versa;
|
| 1.2.3 |
unless
the context clearly indicates a contrary intention, words and expressions
defined in the Act shall bear the meanings therein assigned to
them;
|
| 1.2.4 |
any
reference to any statute shall be to that statute, as amended from
time to
time and to any statutory substitution of that
statute;
|
| 1.2.5 |
a
Participant who ceases to be employed by a Group Member on the basis
that
he is -
|
| 1.2.5.1 |
immediately
thereafter employed by another Group Member;
|
| 1.2.5.2 |
thereafter
re-employed by such Group Member pursuant to it being determined
that his
employment was on a basis which was not lawful in terms of the
LRA;
|
| 1.2.6 |
a
Participant who is a director of any Group Member who retires and/or
resigns on the basis that he is immediately re-elected in accordance
with
the articles of association or other constitutional documents of
that
Group Member shall be deemed not to have terminated his employment
with
that Group Member.
|
| 1.3 |
If
any provision in 1.1
is
a substantive provision conferring any right or imposing any obligation
on
anyone, effect shall be given to it as if it were a substantive provision
in the body of this Deed.
|
| 1.4 |
Save
for the purpose of determining whether or not a Change of Control
has
occurred in accordance with 1.1.7,
any term which refers to a RSA legal concept or process shall be
deemed to
include a reference to the equivalent or analogous concept or process
in
any other jurisdiction in which this Deed may apply or to the laws
of
which a party may be or become subject; furthermore, references to
the
following statutes and/or provisions therein, namely the Act, the
LRA, the
Tax Act and the Trust
|
| 1.5 |
The
use of the word “including”
or “includes”
or “include”
followed by a specific example/s shall not be construed as limiting
the
meaning of the general wording preceding it and the eiusdem
generis
rule shall not be applied in the interpretation of such general wording
or
such specific example/s.
|
| 2 |
PURPOSE
|
| 3 |
CONSTITUTION
OF TRUST
|
| 3.1 |
There
is hereby constituted a trust for the benefit of Participants, to
be known
as “The Sappi Limited Performance Share Incentive Trust”, on the terms and
conditions of this document.
|
| 3.2 |
The
Company shall irrevocably donate R100 (or the equivalent amount in
another
currency) to the Trustees on behalf of the
Trust.
|
| 3.3 |
The
Trust shall be formed in such jurisdiction as the Board may
determine.
|
| 4 |
TRUSTEES
|
| 4.1 |
There
shall at all times be a minimum of two and a maximum of three Trustees
in
office; provided that if for any reason whatever one or more Trustees
ceases and/or fails to act as such, the other Trustee/s in office
shall,
until the Board has made a further appointment/s in terms of 4.4,
be entitled to continue to administer the Trust and to act to protect
and
preserve the Trust’s assets.
|
| 4.2 |
Mr
David Charles Brink and Professor Meyer Feldberg are appointed to
be, and
by their signatures hereto accept appointment as, the initial Trustees
of
the Trust.
|
| 4.3 |
The
Board shall be entitled at any time to appoint any person qualified
for
appointment as a Trustee as a further Trustee in addition to the
initial
Trustees referred to in 4.2.
|
| 4.4 |
Subject
to the provisions of the Trust Act and 4.5,
if any Trustee ceases to hold office for any reason the Board shall
appoint a person, willing to act as such, as Trustee in his
place.
|
| 4.5 |
No
person shall be entitled to participate under this Plan for as long
as he
holds office as a Trustee of the Trust.
Furthermore, no executive director of the Company may at any time
hold
office as a Trustee of the Trust.
|
| 4.6 |
A
Trustee shall cease to hold office as such if
he -
|
| 4.6.1 |
is
removed by resolution of the Board;
or
|
| 4.6.2 |
resigns
on giving the Company and his co-Trustees not less than one calendar
month’s prior written notice to that effect;
or
|
| 4.6.3 |
becomes
disqualified from holding an appointment as a director of any
company.
|
| 4.7 |
The
Trustees shall elect one of their number to act as Chairman for the
purpose of meetings of Trustees and for all other purposes that a
Chairman
may be required in terms of this Deed or
otherwise.
|
| 4.8 |
All
decisions (ie resolutions) of the Trustees shall be taken unanimously
with
each Trustee exercising one vote; provided that, if at any meeting
of
Trustees there are three Trustees present, decisions (ie resolutions)
shall be taken by a simple majority vote with each Trustee being
entitled
to one vote.
|
| 4.9 |
Subject
to the proviso in 4.1,
a
quorum for any meeting of Trustees shall be two
Trustees.
|
| 4.10 |
Subject
to the Trustees giving effect to the terms and conditions of this
Deed, in
administering the Trust and its affairs, the Trustees shall adopt
such
procedures and take such administrative steps as they from time to
time
deem necessary and advisable. They shall meet together for the dispatch
of
the business of the Trust, adjourn and otherwise regulate their meetings
as they, in their discretion, deem fit. Any Trustee shall be entitled
to
summon a meeting of the Trustees by giving written notice to that
effect
to the other Trustee/s.
|
| 4.11 |
Meetings
of the Trustees may be held by tele-conferencing, telephonically
or by any
other medium as the Trustees deem
fit.
|
| 4.12 |
The
Trustees shall procure that minutes of their meetings are taken and
shall,
if appropriate, certify same as
correct.
|
| 4.13 |
A
resolution which has been signed by all of the Trustees shall be
valid and
effective as if it had been adopted at a duly convened meeting of
the
|
| 5 |
POWERS
OF TRUSTEES
|
| 5.1 |
borrow
moneys and/or to raise funding strictly for the purpose of giving
effect
to the Plan;
|
| 5.2 |
make
Conditional Awards;
|
| 5.3 |
open
and operate banking accounts, savings accounts or other accounts
appropriate to the business of the Trust, to draw and issue cheques
and to
receive cheques, promissory notes and/or bills of exchange, and to
endorse
any of the same for collection by any bank or other deposit-taking
institution at which an account has been
opened;
|
| 5.4 |
invest
any surplus moneys of the Trust (if any) in Shares or other securities
of
the Company or in such other manner as the Board may from time to
time
approve;
|
| 5.5 |
employ
and act on the advice of and pay out of the funds of the Trust the
reasonable fees and disbursements of auditors, attorneys, counsel
and
other professional consultants in connection with the affairs of
the
Trust;
|
| 5.6 |
exercise
such further rights, powers and authorities as may from time to time
be
conferred upon them by resolution of the
Board;
|
| 5.7 |
delegate
the day to day administration of the Trust to an officer or employee
of
any company in the Group, which officer or employee shall perform
all of
his duties in accordance with the instructions of the Trustees and
subject
to the provisions of this Deed;
|
| 5.8 |
subject
to 12,
purchase and sell Shares and/or to dispose of the Trust’s
assets;
|
| 5.9 |
subject
to the provisions of the Act, enter into any one or more transactions
to
hedge against or otherwise protect the assets of the Trust and/or
the
Trust itself from incurring any losses of whatever
nature;
|
| 5.10 |
transact
with Group Members and recover amounts from them as contemplated
in
11.
|
| 6 |
SECURITY
|
| 7 |
REMUNERATION
OF TRUSTEES
|
| 7.1 |
The
remuneration, if any, payable to the Trustees in their capacities
as such
shall be determined from time to time by the Board. The Trustees
shall, in
addition, be entitled to reimbursement from the Trust for all expenses
properly incurred by them in and about the execution of their duties
as
Trustees. Such remuneration and reimbursement of expenditure shall
be
borne and paid by the Company if the Trust is unable to pay these
amounts
from its own resources.
|
| 7.2 |
No
Trustee or firm or company of which such Trustee is a member or director
shall be disqualified from acting as adviser, agent, banker, broker
or
attorney to, or contracting with, the Trust, nor from recovering
any
reasonable remuneration in respect of any services performed as such
on
behalf of the trust by such Trustee or his firm or
company.
|
| 8 |
DUTIES
OF TRUSTEES
|
| 8.1 |
subscribe
for or purchase Shares in accordance with the provisions of this
Deed;
|
| 8.2 |
make
Conditional Awards;
|
| 8.3 |
invest
the funds of the Trust in such form as is permitted by this
Deed;
|
| 8.4 |
administer
the Plan in order to achieve and maintain the purpose set out in
2;
|
| 8.5 |
without
derogating from their obligations in terms of 4.12,
cause proper records and books of account to be kept of the affairs
of the
Trust and their administration thereof and to cause financial statements
to be made up to accord with the financial year end of the Company
or such
other date as may be determined by the Board;
and
|
| 8.6 |
carry
out such other duties as may, consistent with their offices as Trustees
and in terms of the provisions of this Deed, be delegated to them
from
time to time by resolution of the
Board.
|
| 9 |
INDEMNITY
AND LEGAL PROCEEDINGS
|
| 9.1 |
None
of the Trustees or officers of the Trust shall be liable for, and
the
Company indemnifies each of them against, any loss sustained out
of
whatever cause arising if -
|
| 9.1.1 |
in
the case of the Trustee, he has performed his duties and exercised
his
powers in compliance with section 9(1) of the Trust
Act;
|
| 9.1.2 |
in
the case of an officer of the Trust, he has performed his duties
in a
manner which is neither grossly negligent nor
fraudulent.
|
| 9.2 |
Legal
proceedings instituted by or against the Trust may be instituted
or
defended in its name.
|
| 10 |
ACQUISITION
OF SHARES BY THE TRUSTEES
|
| 10.1 |
Subject
to the Act and 12,
the Trustees shall be entitled, for the purposes of the Plan, to
purchase
or subscribe for or be given options to purchase or subscribe
for -
|
| 10.1.1 |
such
numbers of Shares at such prices as may be agreed from time to time
by the
Trustees and the Board; and
|
| 10.1.2 |
such
number of Shares at the relevant exercise or issue prices, as may
be
required pursuant to any adjustment in terms of 19.
|
| 10.2 |
The
Company shall at all times reserve and keep available, free from
pre-emptive rights, out of its authorised but unissued share capital,
such
number of Shares as shall (together with any treasury shares held
by Group
Members which may be utilised for the purposes of this Plan) then
be
issuable in terms of this Plan.
|
| 11 |
FUNDING
OF THE TRUST
|
| 11.1 |
The
purchase or subscription price of Shares (if any) acquired by the
Trust in
terms of 10.1
or
otherwise under this Plan, the costs incurred in the acquisition
thereof,
any administration or other expenses or administration fees properly
incurred by or on behalf of the Trustees in the performance of their
duties in terms of or in order to give effect to the Plan (including
in
terms of 22.2.3)
and any duties payable upon the issue or transfer of Shares to
Participants (all of such costs, expenses and fees hereinafter
|
| 11.1.1 |
the
Trust’s own resources, if any, including without limitation, money raised
by any company or companies incorporated by the Trust for the purpose
of
raising funding through the issue of preference shares or other
securities, whether convertible or otherwise, on such terms and conditions
as the Trustees may decide; and/or
|
| 11.1.2 |
loans
to be made to
the Trust by Group Members in accordance with the provisions of section
38(2)(b) of the Act;
|
| 11.1.3 |
loans
by third parties to the Trust to be procured, subject to 38(2)(b)
of the
Act, by the Company on such terms as the Company is able to arrange;
and/or
|
| 11.1.4 |
any
other resource which is available to the Trust from time to
time.
|
| 11.2 |
The
Trust shall recover from each Group Member which employs a Participant,
and the Company shall procure that each Group Member which is the
employer
of a Participant pays to the Trust, such Participation Costs as may
be
attributable to the participation of that Participant plus an appropriate
share of any other administration costs, expenses and fees incurred
by the
Trust.
|
| 12 |
MAXIMUM
NUMBER OF SHARES WHICH MAY BE ACQUIRED BY
PARTICIPANTS
|
| 12.1 |
Subject
to 12.3
and 12.4,
the prior authority of the shareholders of the Company in general
meeting
shall be required if the aggregate number of Shares which may be
acquired
by all Participants under this Plan and the Existing Plan is to exceed
19 000 000 Shares being 7,95% of the Company’s issued Share
capital as at
10 December 2004.
|
| 12.2 |
Subject
to 12.3
and 12.4,
the aggregate number of Shares that may be acquired by any one Participant
in terms of this Plan and the Existing Plan shall not exceed
1 000 000 Shares being 0,41% of the Company’s issued Share
capital as at
10 December 2004.
|
| 12.3 |
The
number
of Shares referred to in 12.1
and 12.2
shall be increased or reduced in direct proportion to any increase
or
reduction of the Shares in the Company’s issued share capital on any
conversion, redemption, consolidation, sub-division and/or any rights
or
capitalisation issue of Shares.
|
| 12.4 |
Subject
to 19,
in the determination
of
the number of Shares which may be acquired by Participants in terms
of
this 12,
the Board shall be entitled to direct the Trustees to refrain from
taking
into account Shares which have been released to a Participant in
terms of
this Plan and/or the Existing Plan.
|
| 13 |
CONDITIONAL
CONTRACTS
|
| 13.1 |
The
Board may, from time to time, determine
-
|
| 13.1.1 |
that
the Trustees should, on behalf of the Company, award Conditional
Contracts
to be given Shares (for no cash consideration) to Eligible
Employees;
|
| 13.1.2 |
the
particular Eligible Employees to whom such Conditional Contracts
should be
awarded;
|
| 13.1.3 |
the
maximum number of Shares to be awarded provisionally to each such
Eligible
Employee;
and
|
| 13.1.4 |
the
Performance Criteria applicable to each Conditional
Contract.
|
| 13.2 |
As
soon as practicable after a determination is made by the Board in
terms of
13.1
or
at such time as is specified by the Board, a written notice (“Conditional
Award Notice”)
shall be delivered to each Eligible Employee to whom the Board has
determined that Shares are to be awarded pursuant to a Conditional
Contract. The Conditional Awarded Notice shall -
|
| 13.2.1 |
be
in writing in the form from time to time prescribed by the Board
and shall
specify such matters in relation to the Plan as the Board may
determine;
|
| 13.2.2 |
specify
the maximum number of Shares to which such Eligible Employee will
become
entitled if the Performance Criteria under the Conditional Contract
are
satisfied or exceeded;
|
| 13.2.3 |
specify
the Allocation Date in respect
thereof;
|
| 13.2.4 |
contain
and stipulate Performance Criteria subject to which the award of
the
Conditional Contract is made and the manner in which the number of
Shares
referred to in 13.2.2
shall be adjusted downwards if the Performance Criteria are not satisfied
(whether in whole or in part);
|
| 13.2.5 |
specify
such other terms and conditions as the Board may
determine.
|
| 13.3 |
Acceptance
by an Eligible Applicant of a Conditional Contract shall be communicated
to the Trustees, in writing, by not later than 30 days after the
date of
delivery of the relevant Conditional Award Notice to such Eligible
Applicant and shall nominate a beneficiary for the purposes of receiving
his Performance Shares (if any) in terms of 17.1.1.
A
Conditional Contract which is not accepted by an Eligible Applicant
as
aforesaid shall automatically lapse and be of no force or effect,
subject
to re-instatement or extension by the Board.
|
| 14 |
PERFORMANCE
SHARES
|
| 14.1 |
Subject
to 14.4,
on the fourth anniversary of the Allocation Date, the Company shall
in
terms of such Conditional Contract allot and issue and/or procure
the
transfer to Participants of such number of Shares as is equal to
the
number of Provisional Shares specified in the Conditional Award Notice
relating to the relevant Conditional Contract. A Participant shall
not be
required to pay any cash consideration
in order to receive Shares as
aforesaid.
|
| 14.2 |
Shares
to be allotted and issued and/or transferred to Participants pursuant
to
the provisions of 14.1
(read with 14.4)
shall be “Performance Shares”.
|
| 14.3 |
Except
to the extent a Conditional Award Notice provides that this 14.3
shall be inapplicable to the Conditional Contract specified therein,
then
notwithstanding anything to the contrary contained herein, the Board
may
by resolution, cause the four year period referred to in 14.1
to
be anticipated or, with the consent of a Participant adversely affected
thereby, postponed to such extent as the Board may determine. In
the event
of such acceleration or postponement the number which is D in the
formula
in 17.1.1
and the reference to the fourth anniversary of the Allocation Date
shall
be deemed to be varied
appropriately.
|
| 14.4 |
If
the Board, in its sole and absolute discretion, 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 in the manner set out in the
Conditional Award Notice pertaining to such Conditional Contract;
that is,
the allotment and issue and/or transfer of Provisional Shares (or
any
portion thereof) specified in the Conditional Award Notice is conditional
upon the Performance Criteria being satisfied or exceeded.
|
| 14.5 |
Notwithstanding
any other provision of this Deed, the Board shall, in its sole and
absolute discretion, be entitled to amend the Performance Criteria
embodied a Conditional Contract (including to take account of any
change
in circumstances which render such Performance Criteria inappropriate);
|
| 15 |
RESTRICTION
|
| 16 |
SHARE
CERTIFICATES PURSUANT TO A CONDITIONAL
CONTRACT
|
| 16.1 |
Subject
to 24,
the Company shall issue share certificates for the Shares allotted
and
issued and/or transferred to a Participant as a result of the acquisition
by such Participant of Shares in terms of 14
by
not later than 60 days after such
acquisition.
|
| 16.2 |
Shares
allotted and issued and/or transferred to Participants in terms of
14
will rank pari passu with the then issued
Shares.
|
| 17 |
TERMINATION
OF EMPLOYMENT
|
| 17.1 |
Subject
to 1.2.5,
if the employment by any Group Member of any Participant who is a
party to
a Conditional Contract (and is therefore conditionally entitled to
Provisional Shares) terminates as a result
of -
|
| 17.1.1 |
(a)
disability or ill health (as certified by an appropriate medical
practitioner nominated by the Trustees); or (b) the transfer/sale
of the
undertaking or part undertaking in which such Participant is employed
to a
person which is not a Group Member other than pursuant to a Change
of
Control; or (c) his Lawful Dismissal for Operational Reasons; or
(d) the
Group Member by which he is employed ceasing to be a Group Member;
or (e)
death; or (f) his retirement on or after normal retirement in terms
of the
Group’s retirement/pension fund; or (g) any other reason approved by the
Board, then such Participant
(or in the case of his death, the beneficiary nominated by him in
terms of
13.3)
shall be entitled, on the fourth anniversary of the Allocation Date
(and
not before then irrespective of the Date of Termination of Employment),
to
receive such number of Performance Shares as calculated in accordance
with
the following formula -
|
|
A
|
=
|
the
number of Performance Shares to be allotted and issued or transferred
(as
the case may be) to the Participant as stipulated in 17.2;
|
|
B
|
=
|
a
number equal to the number of Provisional Shares specified in the
Conditional Award Notice relating to such
Participant;
|
|
C
|
=
|
a
number equal to the number of days that have passed from the Allocation
Date until the Date of Termination of Employment of the Participant
for
any reason specified in 17.1.1;
and
|
|
D
|
=
|
1
460;
|
| 17.1.2 |
any
reason other than a reason contemplated in 17.1.1
and which is not approved by the Board in terms of 17.1.1(g)
(including his voluntary resignation or his early retirement or his
lawful
dismissal (eg his lawful dismissal for dishonest, fraudulent or grossly
negligent conduct)), then his Conditional Contract shall automatically
lapse and cease to be of any further force or effect and he shall
forfeit
all of his rights to Provisional Shares/Performance
Shares.
|
| 17.2 |
Notwithstanding
the Date of Termination of Employment, if a Participant ceases to
be
employed by any Group Member by reason of any of the circumstances
contemplated in 17.1.1,
the number of Performance Shares to be allotted and issued or transferred
(as the case may be) to such Participant shall be the number determined
mutatis mutandis in accordance with the provisions of 14
(including 14.4
and 14.5)
on the assumption that such Participant is still in the employ of
a Group
Member on the fourth anniversary of the Allocation
Date.
|
| 17.3 |
The
Board shall be entitled, and shall have the widest possible powers
(and
shall be entitled to require the Trustees) to treat any Participant
more
favourably than is set out in the provisions of this 17
on
the termination of his employment regardless of the reason for such
termination of employment.
|
| 18 |
LISTING,
TAX, LEGAL REQUIREMENTS AND CASH ALTERNATIVE
|
| 18.1 |
The
Company shall procure the listing of any Shares allotted and issued
and/or
transferred to a Participant in terms of this Plan on the JSE (or
other
appropriate exchange) within a reasonable time (not exceeding 30
days)
after the acquisition thereof.
|
| 18.2 |
Notwithstanding
18.1,
if
a
Group Member or the Trustees are obliged (or would suffer a disadvantage
of any nature if they were not) to account for, withhold or deduct
any (a)
tax in any jurisdiction which is payable in respect of, or in connection
with, the making of any Conditional Award, the conclusion of a Conditional
Contract and/or by virtue of any Provisional Shares becoming Performance
Shares and/or otherwise in connection with this Plan and/or (b) any
amount
in respect of any social security or similar contributions which
would be
recoverable from a Participant in respect of the making of any Conditional
Award, the conclusion of a Conditional Contract and/or by virtue
of any
Provisional Shares becoming Performance Shares and/or otherwise in
connection with this Plan (the obligations referred to in (a) and
(b)
hereinafter referred to as a “Tax/Social
Liability”),
then the Company and/or the Trustees shall be relieved from the obligation
to allot and issue and/or transfer Shares in accordance with 18.1
until that Participant has
either -
|
| 18.2.1 |
made
payment to the relevant Group Member or the Trustees of an amount
equal to
the Tax/Social Liability; or
|
| 18.2.2 |
entered
into an arrangement which is acceptable to that Group Member or the
Trustees to secure that such payment is made (whether by authorising
the
sale of some or all of the Shares acquired by him and the payment
to the
relevant person of the relevant amounts out of the proceeds of the
sale or
otherwise).
|
| 18.3 |
Notwithstanding
anything to the contrary contained in this Plan but subject to
18.2,
on
any Provisional Shares becoming Performance Shares, the obligations
of the
Company and/or the Trust may be discharged by the Group Member by
which
the Participant is employed paying, in cash, an amount equal to the
Fair
Market Value of the Performance Shares as opposed to allotting and
issuing
and/or procuring the transfer of Shares to a Participant. If the
Board
determines that the obligations of the Company and/or Trust are to
discharged in cash, it shall not be necessary to allot and issue
and/or
transfer Shares to a Participant and the Group Member by which the
Participant is employed shall instead be entitled to pay to such
Participant, in cash, an amount equal to the Fair Market Value of
such
Shares on the date on which the Participant became entitled to receive
such Shares.
|
| 18.4 |
Notwithstanding
any other provision of this Plan, no Shares will be issued and/or
transferred to any Participant pursuant to this Plan if the Board
determines, in its sole discretion, that such issuance and/or transfer
will or may violate any Applicable Laws or the listings requirements
of
any securities exchange on which the Shares are listed. The Company
may
condition the issuance and/or transfer of any Shares upon the delivery
by
the Participant to the Company of any certificates, representations,
legal
opinions and agreements that the Board, in its sole discretion, may
deem
necessary for such issuance and/or transfer to comply with any Applicable
Laws or listings requirements.
|
| 19 |
ADJUSTMENTS
|
| 19.1 |
Notwithstanding
anything to the contrary contained herein but subject to 19.2,
if the Company restructures its capital in that
it -
|
| 19.1.1 |
undertakes
a rights offer; or
|
| 19.1.2 |
is
placed in liquidation for purposes of reorganisation;
or
|
| 19.1.3 |
is
party to a scheme of arrangement affecting the structuring of its
share
capital; or
|
| 19.1.4 |
reduces
its share capital (including by a share
repurchase),
|
| 19.2 |
If -
|
| 19.2.1 |
the
Company undergoes a Change of Control after an Allocation Date other
than
a Change of Control initiated by the Board itself;
or
|
| 19.2.2 |
the
person/s (or those persons acting in concert) who has/have Control
of the
company as at an Allocation Date take/s any decision, pass/es any
resolution and/or take/s any action the effect of which is to delist
the
Company from the JSE and the Company becomes aware of such decision,
resolution and/or action,
|
| 19.3 |
Notwithstanding
any other provision of this Deed, if any Participant (on the one
hand) and
the Trustees (on the other), with the approval of the Board, so agree
in
writing -
|
| 19.3.1 |
any
transaction under which that Participant acquired Shares under this
Plan
may be cancelled; or
|
| 19.3.2 |
the
Trust may purchase from that Participant any Shares acquired by him
under
this Plan at a price not exceeding the selling or acquisition price
of
those Shares to him,
|
| 20 |
SALE
AND ASSIGNMENT
|
| 21 |
AMENDMENT
OF THE PLAN
|
| 21.1 |
It
shall be competent for the Board and the Trustees, with the approval
of
the JSE, to amend any of the provisions of this Plan; provided that
no
such amendment affecting any of the matters set out below shall be
competent unless it is sanctioned by the Company in general
meeting -
|
| 21.1.1 |
the
eligibility of Participants under this
Plan;
|
| 21.1.2 |
the
calculation of the total number of Shares which may be acquired for
the
purpose of or pursuant to this
Plan;
|
| 21.1.3 |
the
maximum number of Shares which may be acquired by any Participant
in terms
of this Plan; and
|
| 21.1.4 |
the
provisions of this 21.
|
| 21.2 |
Without
derogating from 21.1
and provided that no amendment affecting any of the matters referred
to in
21.1.1
to
21.1.4
(inclusive) are affected in which event the sanction of the Company
in
general meeting will be required, it shall be competent for the Board
and
the Trustees to -
|
| 21.2.1 |
establish
further plans based on the Plan; or
|
| 21.2.2 |
to
implement this Plan,
|
| 22 |
ADMINISTRATION
|
| 22.1 |
Subject
to the provisions of this Plan and to the approval of the Board,
the
Trustees shall be entitled to make and establish such rules and
regulations, and to amend the same from time to time, as they may
deem
necessary or expedient for the proper implementation and administration
of
this Plan.
|
| 22.2 |
The
Company shall -
|
| 22.2.1 |
bear
all costs of and incidental to the implementation and administration
of
this Plan and shall, as and when necessary, provide all requisite
funds
and facilities for that purpose;
|
| 22.2.2 |
provide
all secretarial, accounting, administrative, legal and financial
advice
and services, office accommodation, stationery and so forth for the
purposes of this Plan;
|
| 22.2.3 |
be
entitled to recover from the Trust all the abovementioned costs and,
in
addition, shall be entitled to be paid a fee to be determined by
the
Board, after consultation with the Trustees, for performing the duties
and
providing the services set out in 22.2.2.
|
| 23 |
ANNUAL
ACCOUNTS
|
| 24 |
STRATE
|
| 25 |
DISPUTES
|
| 25.1 |
Save
as otherwise expressly provided in this Deed (including 25.13),
should any dispute of whatever nature arise in regard to the
interpretation or effect, or the validity, enforceability or rectification
(whether in whole or in part) of, or the respective rights or obligations
of the parties under, or a breach or termination or cancellation
of, this
Deed, then the dispute shall, unless the parties thereto otherwise
agree
in writing, be referred for determination to an expert (“Expert”)
in accordance with the remaining provisions of this 25.
|
| 25.2 |
The
Expert shall -
|
| 25.2.1 |
if
the matter in issue is primarily an accounting matter, be an independent
practising chartered accountant of not less than fifteen years
standing;
|
| 25.2.2 |
if
the matter in issue is primarily a legal matter, be a practising
senior
counsel of not less than five years’ standing as such and practising at
the Johannesburg bar;
|
| 25.2.3 |
if
the matter in issue is any other matter, be an independent accountant
or
be a senior counsel as envisaged in 25.2.1
or
25.2.2
or
be any other independent person,
|
| 25.3 |
The
Expert selected as aforesaid shall in all respects act as an expert
and
not as an arbitrator.
|
| 25.4 |
The
Expert shall be vested with entire discretion as to the procedure
to be
followed in arriving at his decision. It shall not be necessary for
the
Expert to observe or carry out either the strict rules of evidence
or any
|
| 25.5 |
The
Expert shall have the power, inter alia,
to -
|
| 25.5.1 |
investigate
or cause to be investigated any matter, fact or thing which he considers
necessary or desirable in connection with the dispute and, for that
purpose, shall have the widest powers of investigating all the books,
records, documents and other things in the possession of any party
to the
dispute or the Company, the right to take copies and/or make extracts
therefrom and the right to have them produced and/or delivered at
any
place reasonably required by him for the aforesaid
purposes;
|
| 25.5.2 |
interview
and question under oath any of the parties to the dispute or other
parties, including the right to cross examine such
parties;
|
| 25.5.3 |
summon
witnesses;
|
| 25.5.4 |
record
evidence;
|
| 25.5.5 |
make
an interim award;
|
| 25.5.6 |
make
an award regarding legal fees/costs and the Expert’s remuneration. If he
fails or declines to do so, then each of the parties to the dispute
shall
bear and pay its own costs. Until such time as the Expert’s decision is
given, the parties to the dispute shall bear and pay such costs in
equal
Shares;
|
| 25.5.7 |
call
for the assistance of any other person who he may deem necessary
to assist
him in arriving at his decision;
|
| 25.5.8 |
exercise
any additional powers which may be exercised by an arbitrator in
terms of
the Arbitration Act as amended.
|
| 25.6 |
Any
hearing by the Expert shall be held in Johannesburg unless the Expert
determines that it is more convenient or equitable that the hearing
or any
part thereof (including, but without limitation, the taking of evidence)
be held elsewhere, in which event the hearing (or the relevant part
thereof) shall be held in the place so determined by the
Expert.
|
| 25.7 |
The
parties shall use their best endeavours to procure that the decision
of
the Expert shall be given within thirty days or so soon thereafter
as is
possible after it has been
demanded.
|
| 25.8 |
The
decision of the Expert shall be final and binding on all parties
affected
thereby, shall be carried into effect and may be made an order of
any
competent court at the instance of any party to the
dispute.
|
| 25.9 |
This
clause constitutes an irrevocable consent by the Company, the Trustees
and
all Participants and Eligible Employees to any proceedings in terms
thereof and no such party shall be entitled to withdraw therefrom
or to
claim at any such proceedings that it is not bound by this
clause.
|
| 25.10 |
This
clause shall not preclude any party from obtaining relief by way
of motion
proceedings on an urgent basis or from instituting any interdict,
injunction or any similar proceedings in any court in the RSA (and
not in
any other jurisdiction) pending the decision of the
Expert.
|
| 25.11 |
Subject
to 25.5.8,
the provisions of the Arbitration Act as amended shall not apply
in
respect of this clause or any other provision of this
Deed.
|
| 25.12 |
This
clause is severable from the rest of this Deed and shall remain in
effect
even if this Deed is terminated for any
reason.
|
| 25.13 |
Notwithstanding
anything to the contrary contained herein, any dispute as to whether
or
not a Participant has met the Performance Criteria specified in a
Conditional Contract determined by the Board in their sole and absolute
discretion shall not be referred to an expert in terms of this
25
and the decision of the Board shall be final and binding.
|
| 26 |
PROFITS
AND LOSSES AND TERMINATION OF THE PLAN
|
| 26.1 |
The
Company shall, to the extent not recovered by the Trust from Group
Members
in terms of 11.2,
bear any losses sustained by the Trust which are not recovered from
Group
Members in terms of 11.
Furthermore, the Company shall be entitled to receive and be paid
any
profits made, by the Trust in respect of the purchase, acquisition,
sale
or disposal of Shares.
|
| 26.2 |
The
Plan shall terminate if there are no longer any Conditional Contracts
in
force and the Board and the Trustees so resolve. Upon such termination,
the assets (if any) of the Trust shall be realised and any surplus
remaining after the discharge of the Trust’s liabilities shall be paid
over to the Company. Any deficit arising from the winding up of the
Trust
shall be borne by the Company, to the extent not recovered by the
Trust
from Group Members in terms of 11.2.
|
| 27 |
DOMICILIUM
AND NOTICES
|
| 27.1 |
The
parties choose domicilium citandi et executandi for the purposes
of this
Plan is as follows -
|
| 27.1.1 |
the
Company and :
The
physical address and telefax
|
|
the
Trustees :
number
of the Registered Office of the Company from time to
time;
|
| 27.1.2 |
each
Participant :
The
physical address, telefax number and
electronic mail address from time
to time reflected as being his address,
telefax
|
| number and/or electronic address in the Group’s payroll system from time to time. |
| 27.2 |
Each
of the parties shall be entitled from time to time, by written notice
to
the other, to vary its domicilium to any other physical address and/or
its
facsimile number and/or (in the case of a Participant) his electronic
mail
address; provided in the case of a Participant such variation is
also made
to his details on the Group’s payroll
system.
|
| 27.3 |
Any
notice given and any payment made by any party to the other
which -
|
| 27.3.1 |
is
delivered by hand during the normal business hours of the addressee
at the
addressee’s domicilium for the time being shall be rebuttably presumed to
have been received by the addressee at the time of
delivery;
|
| 27.3.2 |
is
posted by prepaid registered post to the addressee at the addressee’s
domicilium for the time being shall be rebuttably presumed to have
been
received by the addressee on the tenth day after the date of
posting.
|
| 27.4 |
Any
notice given by any party to any other party which is transmitted
by
electronic mail and/or facsimile to the addressee at the addressee’s
electronic address and/or facsimile address (as the case may be)
for the
time being shall be presumed, until the contrary is proved by the
addressee, to have been received by the addressee on the date of
successful transmission thereof.
|
| 27.5 |
For
the sake of clarity and the avoidance of any doubt it is recorded
that a
Participant shall not be entitled to give any notice or serve any
process
on the Company and/or the Trustees by electronic
mail.
|
| 28 |
AMERICAN
DEPOSITORY SHARES
|
| 28.1 |
Notwithstanding
any other provision in this Deed but subject to all Applicable Laws,
Eligible Employees may if the Board deems it to be appropriate be
granted
the opportunity to participate in the Plan by way of ADSs (as opposed
to
Shares), in which event Eligible Employees may be awarded Conditional
Contracts to be given ADSs (as opposed to
Shares).
|
| 28.2 |
If
an Eligible Employee is granted an opportunity to participate in
this Plan
as set out in 28.1,
all references in this Deed to “Shares” shall be deemed to apply mutatis
mutandis to ADSs.
|
| 29 |
COMPLIANCE
|
| 29.1 |
The
Company shall comply with (and procure compliance by all Group Members
with) all Applicable Laws. This Plan shall at all times be operated
and
administered subject to all Applicable Laws. Without derogating from
the
generality of the aforegoing, the Company
shall -
|
| 29.1.1 |
adhere
to and comply with the provisions of section 93 of the Act;
and
|
| 29.1.2 |
appoint
the Secretary as Compliance Officer of the Plan in terms of section
144A
of the Act and comply with the provisions of section 144A of the
Act.
|
| 29.2 |
The
Company, by its signature hereto, undertakes to procure compliance
by
every other Group Member with this
Deed.
|
| Signed at Johannesburg | on 31 March 2005 |
| for Sappi Limited |
| /s/ Jonathan Leslie | |
|
who
warrants that he is duly
authorised
hereto
|
| Signed at Johannesburg | on 31 March 2005 |
| /s/ David Charles Brink | |
|
David
Charles Brink
|
| Signed at New York City | on 12 April 2005 |
| /s/ Meyer Feldberg | |
|
Meyer
Feldberg
|
| Signed at Johannesburg | on |
| /s/ Eugene van As | |
|
Chairman
of the meeting
Date:
|