Note 46

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All monetary amounts are expressed            
in millions of Rands   2010     2009  
46.   RELATED PARTY TRANSACTIONS, DIRECTORS' EMOLUMENTS AND INTEREST            
46.1   Identity of related parties            
    The Group has a related party relationship with its subsidiary companies (Annexure 1), associate            
    companies (note 6), joint ventures (note 40), retirement and other benefit plans (note 45) and with its            
    directors and executive officers.            
46.2   Related party transactions and balances            
    During the year the Company and its related parties, in the ordinary course of business, entered into            
    various inter-group sale and purchase transactions. These transactions are no less favourable than            
    those arranged with third parties.            
                 
    Balances between the Company and its subsidiaries have been eliminated on consolidation and are            
    not disclosed in this note. Details of balances with other related parties are disclosed below.            
                 
    Consani Engineering (Proprietary) Limited   –     154,5  
    Impairment provision   –     (129,2)  
        –     25,3  
    The loan amounts were unsecured, interest free and had no fixed terms of repayment. Refer to note 7.            
                 
    Amounts owed to related parties            
    Unsecured interest bearing borrowings            
    Amounts owing to joint ventures   193,1     137,6  
    The amounts owing to the joint ventures are unsecured, with no fixed terms of repayment and carrying            
    interest at 10% (2009: 7%) per annum.            
46.3   Transactions with key management personnel            
    Interest of the directors in the share capital of the company is set out in the directors’ report.            
    The key management personnel compensation, excluding the directors, is:            
    Salaries   30,4     28,9  
    Retirement fund contributions   2,3     3,5  
    Allowances   1,5     4,1  
    Other benefits   0,2     1,0  
    Total guaranteed remuneration   34,4     37,5  
    Gain on exercise of share options   14,5     20,8  
    Performance related   17,8     15,6  
        66,7     73,9  

    Executive directors
    The remuneration of executive directors for the year ended 30 June 2010 was as follows:

                    Car                          
              Retirement     allowance/           Total              
              fund     Company     Other     guaranteed     Performance        
        Salary     contributions     car     benefits     remuneration     related*     Total  
    2010   R’000     R’000     R’000     R’000     R’000     R’000     R’000  
    BC Bruce4   4 068     445     233     104     4 850     –     4 850  
    MP Chaba1   1 909     204     190     14     2 317     750     3 067  
    O Fenn2   1 971     171     40     18     2 200     750     2 950  
    TG Fowler3   2 016     239     81     7     2 343     750     3 093  
    RW Rees   2 900     327     300     23     3 550     1 500     5 050  
        12 864     1 386     844     166     15 260     3 750     19 010  
    2009                                          
    BC Bruce   3 660     433     300     117     4 510     5 000     9 510  
    RW Rees   2 620     300     358     172     3 450     3 000     6 450  
        6 280     733     658     289     7 960     8 000     15 960  
    SJ Flanagan resigned as a director and an employee of the Group on 31 January 2010 (2010 remuneration: R2,4 million (2009: R6 million)).
     
    * Performance bonuses are accounted for on an accrual basis, to match the amount payable to the applicable financial year end.
     
    1   Appointed 01 September 2009.
    2   Appointed 20 November 2009 – Excludes compensation for loss of benefits in relation to prior employment of R1,5 million.
    3   Appointed 25 September 2009.
    4   The Group Chief Executive voluntarily declined a salary increase for the year ahead and declined an incentive allocation in respect of the 2010 financial year.
     
   

The remuneration of executive directors and key management personnel is determined by the remuneration & human resources committee having regard to the performance of individuals and market trends.

Details of service on Board committees are set out in the Corporate Governance Report.

Interest of the directors in the share capital of the Company is set out in the directors’ report.

The executive directors of the Company hold in aggregate, directly or indirectly, grants of options from The Murray & Roberts Trust in respect of 0,75% (2009: 0,84%) of the ordinary shares of the Company. These options are subject to the terms and conditions of the employee share scheme.
     
    Key management
    RSA

                    Car                          
              Retirement     allowance/           Total              
              fund     Company     Other     guaranteed     Performance        
        Salary     contributions     car     benefits     remuneration     related*     Total  
    2010   R’000     R’000     R’000     R’000     R’000     R’000     R’000  
    Employee A   2 621     300     300     28     3 249     1 500     4 749  
    Employee B   2 443     349     144     24     2 960     1 500     4 460  
    Employee C   1 699     246     144     57     2 146     2 100     4 246  
        6 763     895     588     109     8 355     5 100     13 455  
    2009                                          
    Employee A   2 405     272     300     48     3 025     2 500     5 525  
    Employee B   2 240     336     102     72     2 750     2 250     5 000  
    Employee C   1 466     209     144     129     1 948     1 850     3 798  
        6 111     817     546     249     7 723     6 600     14 323  

    International

                                               
              Retirement                 Total              
              fund           Other     guaranteed     Performance        
        Salary     contributions     Allowances     benefits     remuneration     related*     Total  
    2010   USD’000     USD’000     USD’000     USD’000     USD’000     USD’000     USD’000  
    Employee A   424     –     –     –     424     170     594  
    Employee B   324     –     –     –     324     158     482  
    Employee C   253     –     13     7     273     575     848  
        1 001     –     13     7     1 021     903     1 924  
    2009                                          
    Employee A   404     –     –     –     404     211     615  
    Employee B   308     –     –     –     308     197     505  
    Employee C   244     –     13     7     264     1 303     1 567  
        956     –     13     7     976     1 711     2 687  
   
* Performance bonuses are accounted for on an accrual basis, to match the amount payable to the applicable financial year end. Clough Limited’s key management emoluments are excluded from the above as they are disclosed in Clough’s Annual Report.
     
    Non-executive directors
    The level of fees for service as director, additional fees for service on the Board committees and the chairman’s fee are reviewed annually.
     
    The remuneration of non-executive directors for the year ended 30 June 2010 was:

        Directors’     Non-     Special     Committee     Chairman’s     Total     Total  
        fees     attendance     Board     fees     fee     2010     2009  
        R’000     R’000     R’000     R’000     R’000     R’000     R’000  
    RC Andersen   –     –     –     –     988     988     910  
    DD Barber   147     –     52     211     –     410     303  
    ADVC                                          
    Knott-Craig   147     (13)     52     101     –     287     137  
    N Magau   147     (12)     52     128     –     315     260  
    M McMahon   147     –     26     64     –     237     224  
    I Mkhize   147     –     26     138     –     311     280  
    AA Routledge   147     –     52     138     –     337     280  
    MJ Shaw1   –     –     –     –     –     –     97  
    SP Sibisi   147     –     52     133     –     332     263  
    JJM van Zyl1   –     –     –     –     –     –     80  
    M Sello   147     (13)     52     74     –     260     70  
    RT Vice   147     –     52     181     –     380     305  
        1 323     (38)     416     1 168     988     3 857     3 209  
    1 Retired 28 October 2008.
     
   

The remuneration of non-executive directors is submitted to the annual general meeting for approval in advance of such payment being made.

The chairman’s fee includes attendance at committee meetings.

Details of service on Board committees are set out in the Corporate Governance Report.

Interest of the directors in the share capital of the Company is set out in the directors’ report.

                                                  Outstanding        
        Outstanding           Granted     Exercised     Net     Average     Surrendered     options at        
        options at     Strike     during     during     gain     exercise     during     30 June     Expiry  
    Grant date   Conditions     1 July 2009     price     the year     the year     (R’000)     price     the year     2010     date  
    Bruce, BC                                                            
    15 Mar 2004   Standard     35 000     13,04     –     –     –     –     –     35 000     15 Mar 2014  
    15 Mar 2004   Hurdle     17 500     13,04     –     –     –     –     –     17 500     15 Mar 2014  
    28 Jun 2005   Standard     67 500     14,00     –     –     –     –     –     67 500     28 Jun 2011  
    28 Jun 2005   Hurdle     67 500     14,00     –     –     –     –     –     67 500     28 Jun 2011  
    06 Mar 2007   Special     800 000     50,60     –     –     –     –     –     800 000     06 Mar 2013  
          987 500           –     –     –           –     987 500        
    Rees, RW                                                            
    06 Mar 2003   Standard     16 250     11,00     –     –     –     –     –     16 250     06 Mar 2013  
    06 Mar 2003   Hurdle     25 000     11,00     –     –     –     –     –     25 000     06 Mar 2013  
    15 Mar 2004   Standard     45 000     13,04     –     –     –     –     –     45 000     15 Mar 2014  
    15 Mar 2004   Hurdle     45 000     13,04     –     –     –     –     –     45 000     15 Mar 2014  
    28 Jun 2005   Standard     15 000     14,00     –     –     –     –     –     15 000     28 Jun 2011  
    03 Mar 2006   Standard     150 000     23,53     –     –     –     –     –     150 000     03 Mar 2012  
    03 Mar 2006   Hurdle     100 000     23,53     –     –     –     –     –     100 000     03 Mar 2012  
    06 Mar 2007   Special     380 000     50,60     –     –     –     –     –     380 000     06 Mar 2013  
          776 250           –     –     –           –     776 250        
    Chaba, MP1                                                            
    28 Jun 2005   Standard     110 000     14,00     –     50 000     1 279     39,74     –     60 000     28 Jun 2011  
    28 Jun 2005   Hurdle     40 000     14,00     –     20 000     826     55,52     –     20 000     28 Jun 2011  
    03 Mar 2006   Standard     25 000     23,53     –     –     –     –     –     25 000     03 Mar 2012  
    03 Mar 2006   Hurdle     20 000     23,53     –     15 000     398     50,26     –     5 000     03 Mar 2012  
    06 Mar 2007   Standard     365 000     50,60     –     –     –     –     –     365 000     06 Mar 2013  
          560 000           –     85 000     2 503           –     475 000        
    Fenn, O2                                                            
    08 Dec 2009   Standard     –     45,42     125 000     –     –     –     –     125 000     08 Dec 2015  
    Fowler, TG3                                                            
    26 Aug 2009   Standard     –     47,74     125 000     –     –     –     –     125 000     26 Aug 2015  
    1 Appointed 01 September 2009.
2 Appointed 20 November 2009.
3 Appointed 25 September 2009.
   


SJ Flanagan resigned as a director and an employee from the Group on 31 January 2010. There were no outstanding options at 30 June 2010 (2009: 1 028 750). All options outstanding at 1 July 2009 were either exercised or surrendered during the year.

Interests of directors in contracts
A register detailing directors’ interests in the Company is available for inspection at the Company’s registered office.

Directors’ service contracts
Directors do not have fixed-term contracts, but executive directors are subject to notice periods of between one and twelve months. There is no material liability to the Group with respect to the termination of contract of any director. Normal retirement of executive directors is at age 63, while non-executive directors are required to retire at age 70.

 

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