Petra Diamonds Limited
Annual Report and Accounts 2013
126
27. Share-based payments
continued
Share grants to Directors: 2011 LTSP, 2012 PSP and deferred awards
continued
2012 PSP – market and non-market-based performance conditions
2013
2012
Fair value (PSP absolute TSR/PSP relative TSR/PSP non-market)
39.0p/60.0p/110.0p
47.0p/85.0p/133.0p
Grant date
20 December 2012
15 May 2012
Share price at grant date
109.7p
133.0p
Expected volatility
51%
53%
Life of award
2.8 years
2.4 years
Expected dividends
Performance period
3 years
3 years
Correlation
41%
41%
Risk-free interest rate (based on national Government bonds)
0.5%
0.4%
The expected volatility is based on historic volatility of the Group’s share price, adjusted for any extreme changes in the share
price during the historic period. During the year, 1,198,268 PSP (30 June 2012: 764,332) shares were awarded at a fair value price
of 109.7 pence (30 June 2012: 133.0 pence). There were no shares awarded under the 2011 LTSP (30 June 2012: 1,200,000). The correlation
factor used above is based on analysis of historical correlation rates between the Company and mining companies within the FTSE
350. The grant date fair values incorporate the effect of the relevant market-based conditions. The awards have no exercise price.
On 18 December 2012, the Executive Directors of the Company were granted a total of 196,911 deferred awards over ordinary shares
in the Company. The deferred share awards were fair valued using a Black-Scholes model at the date of grant. The share price at
grant date was 110.0 pence. The awards represent 25% of the total bonus in respect of performance for the financial year ended
30 June 2012. The awards vest on 30 June 2014 and vesting is subject to continued employment. These awards have no exercise price.
Further information on the terms of the awards (including their vesting conditions) can be found on pages 75 to 77 of the Directors’
Remuneration Report, together with a reconciliation of the awards for the year and the remaining contractual term on pages 80 to 81.
Share grants to Senior Management: 2011 LTSP
The share-based payment awards are considered to be equity settled, albeit they can be cash settled at the Company’s option.
The fair value of the 2011 LTSP granted to Senior Management during the year and the assumptions used in the Monte Carlo
model are as follows:
2011 LTSP – non-market-based subject to performance conditions
2013
2012
Fair value
118.1p
Grant date
25 September 2012
Share price at grant date
118.1p
Life of award
3.4 years–4.4 years
Expected dividends
During the year, 7,055,000 2011 LTSP (30 June 2012: nil) shares were awarded. These awards have no exercise price. The awards vest
in full based on performance conditions measured over the period ending 30 June 2016. The awards have the same performance
targets as the awards to Directors under the 2011 LTSP and have been valued using a Monte Carlo model. Further information
on the performance targets of the awards can be found on page 77 of the Directors’ Remuneration Report.
The interests of Senior Management under the 2011 LTSP are as follows:
2013
Weighted
average
exercise price
(pence)
Number
Outstanding at beginning of the year
Granted during the year
— 7,055,000
Outstanding at the end of the year
— 7,055,000
Exercisable at the end of the year
The awards outstanding at 30 June 2013 have no exercise price and a weighted average remaining contractual life of 3.4 years
to 4.4 years.
Employee and Director share options
The Company has an established share option programme that entitles the Remuneration Committee, at its discretion, to grant share
options to Directors and Senior Management. There were no new employee share options granted during the year (30 June 2012: nil).
The share-based payment expense has been calculated using the Black-Scholes model. All share options are equity-settled.
Notes to the Annual Financial Statements
For the year ended 30 June 2013 continued
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