30th Dec 2008 11:17
30 December 2008
International Ferro Metals Limited
("IFL" or the "Company")
Review of Remuneration Policies
The Company has completed a review of its remuneration policies and in particular its long term incentive programme for the retention and motivation of personnel associated with its phantom share option plan. Phantom share options are a means of remuneration whose quantum varies in accordance with increases in the Company's share price. Since equity is not issued as a result of their exercise, they do not result in shareholder dilution. However they represent a potential cash cost.
Taking into account the need to conserve cash in the near term and yet to provide an incentive to employees and directors to add value for the benefit of all shareholders, the Company has decided to cancel all existing options held by current officers and employees (amounting to 8,076,735 phantom share options and 1,000,000 equity options) and issue a new tranche with vesting provisions that do not allow exercise over the next twelve months. The cost to the Company as at the date of grant, using the binominal option pricing method of valuation, will be less than the accumulated cost as at 30 June 2008. (R44,767,923 at 30 June 2008 versus R12,664,644 under the new issue)
Under the new issue, 17,083,000 phantom share options have been granted at an exercise price of 16p being the 30 trading day weighted average share price on the London Stock Exchange prior to the date of grant. Of these, 7,583,000 are to employees and 9,500,000 to executive directors. They have a term of five years, vesting in three equal and annual tranches, commencing 30 December 2009, and the maximum benefit will be capped by a reference share price of 100p. The individual entitlements to each director are shown in the table below:
|
Name of Director |
Number of phantom share options granted in the new issue |
Number of phantom share options cancelled from previous issues |
|
Tony Grey (Executive Chairman) |
3,100,000 |
825,833 |
|
Stephen Turner (Chief Executive Officer) |
3,100,000 |
825,833 |
|
David Kovarsky (Managing Director) |
1,700,000 |
1,000,000 equity options |
|
Xiaoping Yang (Executive Director) |
1,600,000 |
446,250 |
|
All other employees |
7,583,000 |
|
|
17,083,000 |
The total number of phantom share options represents 3.4% of the total number of shares that the Company has in issue thereby falling within the rule that the total number of phantom options cannot exceed 4% of the Company's total issued share capital.
For further information please contact:
International Ferro Metals Limited
Stephen Turner, Chief Executive Officer
Mob: +61 418 440 844
OR
David Kovarsky, Managing DirectorMob: +27 82 650 1192
www.ifml.com
Brunswick Group
Patrick Handley / Carole Cable
Tel: +44 (0) 20 7404 5959
Numis Securities Limited
John Harrison / Stuart Skinner
Tel: +44 (0) 20 7260 1000
Notes to editors:
IFL produces ferrochrome, the essential ingredient in stainless steel, from its integrated chromite mine and ferrochrome processing operations in South Africa.
Related Shares:
IFL.L