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Sasol Limited 1979/003231/06
1 Sturdee Avenue Rosebank 2196 PO Box 5486 Johannesburg 2000 South Africa
Telephone +27 (0)11 441 3111 Facsimile +27 (0)11 788 5092 www.sasol.com
Directors: TH Nyasulu (Chairman) LPA Davies (Chief Executive) C Beggs BP Connellan HG Dijkgraaf (Dutch)
VN Fakude (Executive) MSV Gantsho A Jain (Indian) GA Lewin (Australian) IN Mkhize MJN Njeke KC Ramon (Executive)
JE Schrempp (German) TA Wixley Company Secretary: NL Joubert
1 Sturdee Avenue Rosebank 2196 PO Box 5486 Johannesburg 2000 South Africa
Telephone +27 (0)11 441 3111 Facsimile +27 (0)11 788 5092 www.sasol.com
Directors: TH Nyasulu (Chairman) LPA Davies (Chief Executive) C Beggs BP Connellan HG Dijkgraaf (Dutch)
VN Fakude (Executive) MSV Gantsho A Jain (Indian) GA Lewin (Australian) IN Mkhize MJN Njeke KC Ramon (Executive)
JE Schrempp (German) TA Wixley Company Secretary: NL Joubert
May 28, 2010
Mr. H. Roger Schwall
Assistant Director
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C 20549
Dear Mr. Schwall
Sasol Limited
Form 20-F for the Year Ended June 30, 2009
Filed October 9, 2009
Response letter dated March 31, 2010
File No. 1-31615
We refer to the Staff’s comment letter dated 2 March 2010, relating to the Form 20-F of Sasol
Limited (the “Company”) for the year ended 30 June 2009 and our response letter dated 31
March 2010. Set forth below in detail are the responses to the Staff’s comments, which have
been provided in each case following the text of the comment in the Staff’s letter. The Staff is
referred to the definitions contained in the Form 20-F for the year ended 30 June 2009.
1. We note your response to comment two of our letter dated March 2, 2010 which specifies
Mr. H. Roger Schwall
Assistant Director
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C 20549
Dear Mr. Schwall
Sasol Limited
Form 20-F for the Year Ended June 30, 2009
Filed October 9, 2009
Response letter dated March 31, 2010
File No. 1-31615
We refer to the Staff’s comment letter dated 2 March 2010, relating to the Form 20-F of Sasol
Limited (the “Company”) for the year ended 30 June 2009 and our response letter dated 31
March 2010. Set forth below in detail are the responses to the Staff’s comments, which have
been provided in each case following the text of the comment in the Staff’s letter. The Staff is
referred to the definitions contained in the Form 20-F for the year ended 30 June 2009.
1. We note your response to comment two of our letter dated March 2, 2010 which specifies
that you capitalize expenditures incurred to sustain your operations. Please clarify for us
the meaning of the phrase “sustain the operations of the Company” as it relates to
paragraph 12 of IAS 16. As part of your response, please provide us with examples of the
most material items included in the R5 665 million in expenditures incurred to sustain your
operations in fiscal 2009.
Response
the meaning of the phrase “sustain the operations of the Company” as it relates to
paragraph 12 of IAS 16. As part of your response, please provide us with examples of the
most material items included in the R5 665 million in expenditures incurred to sustain your
operations in fiscal 2009.
Response
The financial statements included in our Form 20-F for the year ended 30 June 2009
provides disclosure of the Company’s accounting policies on page F-17, relating to costs
capitalised in respect of replacing or modifying significant components of plant.
Expenditure incurred to sustain the operations of the Company relates primarily to those
items of property, plant and equipment which require replacement at regular intervals as
contemplated in IAS 16.13 as well as those items that are a condition of continuing to
operate an item of property, plant and equipment per IAS 16.14 (major inspection or
overhaul costs used over more than one period). All costs related to routine repairs and
maintenance are expensed in the income statements per IAS 16.12.
As part of the normal plant operations, the Company incurs capital expenditure, which
includes replacing or modifying significant components of plant to maintain the useful lives
provides disclosure of the Company’s accounting policies on page F-17, relating to costs
capitalised in respect of replacing or modifying significant components of plant.
Expenditure incurred to sustain the operations of the Company relates primarily to those
items of property, plant and equipment which require replacement at regular intervals as
contemplated in IAS 16.13 as well as those items that are a condition of continuing to
operate an item of property, plant and equipment per IAS 16.14 (major inspection or
overhaul costs used over more than one period). All costs related to routine repairs and
maintenance are expensed in the income statements per IAS 16.12.
As part of the normal plant operations, the Company incurs capital expenditure, which
includes replacing or modifying significant components of plant to maintain the useful lives
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of the plant operations, improve plant efficiencies, increase plant production yields, etc.
The item of plant which is replaced in each case would be scrapped and written off at the
time that it is replaced.
Included in the R5 665 million, R4 906 million relates to expenditure in respect of
sustaining operations and the remaining balance relates to expenditure to meet legal and
environmental obligations (refer to first response per IAS 16.11 and two examples
discussed). The following are examples of the most material projects to sustain existing
operations:
The item of plant which is replaced in each case would be scrapped and written off at the
time that it is replaced.
Included in the R5 665 million, R4 906 million relates to expenditure in respect of
sustaining operations and the remaining balance relates to expenditure to meet legal and
environmental obligations (refer to first response per IAS 16.11 and two examples
discussed). The following are examples of the most material projects to sustain existing
operations:
Project*
Business Unit
R millions
FT3 plant project
Sasol Synfuels
International
International
288
Ash lock project
Sasol Synfuels
191
Hydrocrackers project
Sasol Oil
184
Replacement of information management
systems and software
systems and software
Other businesses
174
Replacement of existing radio systems
Other businesses
121
Replace long term catalyst
Sasol Synfuels
112
Synthol tailgas compressor and turbine systems
project
project
Sasol Synfuels
110
Replacement of air heater systems at boiler 9
Sasol Synfuels
104
Thubelisha shaft to maintain Twistdraai Colliery
operation
operation
Sasol Mining
91
Replacement of tube bundles of interstage
cooler systems
cooler systems
Sasol Synfuels
90
Change plant to reduce benzene in fuel
Sasol Synfuels
84
Replacement of trunk and gathering lines at
Sasol Petroleum Temane
Sasol Petroleum Temane
Sasol Petroleum
International
International
84
Diesel Unifier project
Sasol Oil
79
Switchgear replacement programmes
Sasol Synfuels
64
Replacement of conveyor belts for coal
processing and ash plants
processing and ash plants
Sasol Synfuels
62
Replacement of cranes
Other businesses
61
Replacement of Infrachem laboratory
Sasol Infrachem
60
Depot expansion project
Sasol Oil
52
Replacement of turbine rotors for generator 4
Sasol Synfuels
51
Secunda Natref pipeline project
Sasol Oil
50
Replace long term catalyst
Sasol Oil
50
*Projects not listed above are less than R50 million each.
We will expand this disclosure in the Form 20-F to be filed with the United States
Securities and Exchange Commission for the year ended 30 June 2010.
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2. We note your response to comment three of our letter dated March 2, 2010 which
specifies that the 25.5 million preferred shares subscribed for and issued to special
purpose entities are deemed treasury shares for the purposes of calculating shares
outstanding for EPS-basic. With respect to the 16,085,199 preferred shares subscribed
through a funding company for the benefit of the Black Public and 9,461,882 preferred
ordinary shares subscribed through a funding company/facilitation trust for the benefit of
the Selected Participants, please tell us:
purpose entities are deemed treasury shares for the purposes of calculating shares
outstanding for EPS-basic. With respect to the 16,085,199 preferred shares subscribed
through a funding company for the benefit of the Black Public and 9,461,882 preferred
ordinary shares subscribed through a funding company/facilitation trust for the benefit of
the Selected Participants, please tell us:
•
the method by which the company will repay the existing underlying long-term debt. As
part of your response, please identify the intended purchaser (e.g. the Company, third
parties, etc.) of the common shares upon conversion, and describe how a short-fall
would impact the repayment of the preference debt; and
part of your response, please identify the intended purchaser (e.g. the Company, third
parties, etc.) of the common shares upon conversion, and describe how a short-fall
would impact the repayment of the preference debt; and
Response
The structure of the Inzalo transaction is as follows and should be referred to for all
responses in comment 2:
The structure of the Inzalo transaction is as follows and should be referred to for all
responses in comment 2:
(Refer notification of prospectus filed on Form 6-K on 20 June 2008 and circular to shareholders filed on
Form 6-K on 25 April 2008)
Form 6-K on 25 April 2008)
The funding companies, Sasol Inzalo Public Funding (Pty) Limited (in respect of the
Black Public Invitation – Funded option) and Sasol Inzalo Groups Funding (Pty) Limited
(in respect of the Selected Participants) (“the funding companies”) issued cumulative
redeemable preference shares (A, B and C preference shares) to certain financial
institutions, including preference shares subscribed for by the Company (D preference
shares). Additional details of the preference share funding is provided on page 138 of
the Form 20-F for the year end 30 June 2009. The preference shares are secured by
the Sasol preferred ordinary shares held by these funding companies as well as a
guarantee from Sasol Limited (refer to note 18 on F-78). It should be noted that these
100%
100%
100%
2,6% (Sasol
preferred
ordinary shares)
preferred
ordinary shares)
1,5% (Sasol
preferred
ordinary shares)
preferred
ordinary shares)
1,5% (Sasol
ordinary
shares)
ordinary
shares)
100%
100%
100%
Sasol employees
Sasol black managers
Beneficiaries
Selected
Participants
Black public
Sasol Inzalo Employee
Trust
Sasol Inzalo Management
Trust
Trust
Sasol Inzalo Management
Trust
(“Employee Trusts”)
Sasol Inzalo
Foundation
(“Foundation”)
Sasol Inzalo Groups
Funding (Pty)
Limited
(“Groups FundCo”)
Sasol Inzalo
Public Funding
(Pty) Limited
(“Public
FundCo”)
4% (Sasol
ordinary
shares)
ordinary
shares)
Sasol Inzalo Groups
Limited
Sasol Inzalo
Public Limited
100%
0,4% (Sasol BEE
ordinary
shares)
ordinary
shares)
Sasol Limited
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preference shares are not convertible into Sasol ordinary shares and as such there is
no purchaser.
The debt will be settled in cash by the funding companies using the contractual
preference dividends to be declared semi-annually on the Sasol preferred ordinary
shares held by the funding companies. The obligation must be settled in cash and the
funding companies are not entitled to settle the obligation through the issuing of
additional equity instruments. However, after the ten year period if the debt is not
settled in full, the Sasol preferred ordinary shares held by the funding companies will
automatically be Sasol ordinary shares which will be listed on the JSE Limited. These
shares will be sold to the extent required and the proceeds realised on the sale thereof
will be utilised by the funding companies to settle their remaining obligations in respect
of the preference debt.
In the event of a short-fall during the transaction term (being ten years), the Company
may at its sole discretion subscribe for E preference shares in the funding companies in
order to enable the funding companies to redeem the preference shares and/or comply
with their obligations under the financing agreements. These E preference shares were
not issued at the inception of the transaction or to date.
no purchaser.
The debt will be settled in cash by the funding companies using the contractual
preference dividends to be declared semi-annually on the Sasol preferred ordinary
shares held by the funding companies. The obligation must be settled in cash and the
funding companies are not entitled to settle the obligation through the issuing of
additional equity instruments. However, after the ten year period if the debt is not
settled in full, the Sasol preferred ordinary shares held by the funding companies will
automatically be Sasol ordinary shares which will be listed on the JSE Limited. These
shares will be sold to the extent required and the proceeds realised on the sale thereof
will be utilised by the funding companies to settle their remaining obligations in respect
of the preference debt.
In the event of a short-fall during the transaction term (being ten years), the Company
may at its sole discretion subscribe for E preference shares in the funding companies in
order to enable the funding companies to redeem the preference shares and/or comply
with their obligations under the financing agreements. These E preference shares were
not issued at the inception of the transaction or to date.
•
the number of shares held by the funding companies and the number of shares held by
the Black Public and Selected Participants and whether the identification of the holder
impacts your conclusion as to whether such shares represent treasury shares for
purposes of your basic earnings per share calculation. In this regard, it appears from
your disclosure that certain shares related to the Black Public offering are held by
members of the Black Public rather than by entities consolidated by Sasol;
the Black Public and Selected Participants and whether the identification of the holder
impacts your conclusion as to whether such shares represent treasury shares for
purposes of your basic earnings per share calculation. In this regard, it appears from
your disclosure that certain shares related to the Black Public offering are held by
members of the Black Public rather than by entities consolidated by Sasol;
Response
The identification of the holder did impact the conclusion as to whether such shares
represent treasury shares for purposes of the basic earnings per share calculation.
If the shares are held through the consolidated funding companies (special purpose
entities), they are treated as treasury shares for purposes of the basic earnings per
share calculation. If the shares are held directly by the Black Public Invitation – Cash
option, they are not treated as treasury shares and are included in the calculation of the
weighted average number of shares for the purposes of the basic earnings per share
calculation.
Participants in the Black Public Invitation – Funded option, through the funding
company, Sasol Inzalo Public Funding (Pty) Limited, subscribed for 16,1 million Sasol
preferred ordinary shares. At 30 June 2009, 57 254 Sasol preferred ordinary shares,
which were not subscribed for by the Black Public, were issued to the facilitation trust,
which is funded by Sasol.
The Selected Participants, through the funding company, Sasol Inzalo Groups Funding
(Pty) Limited, subscribed for 8,4 million Sasol preferred ordinary shares. At 30 June
2009, 1,1 million Sasol preferred ordinary shares, which were not subscribed for by the
Selected Participants, were issued to the facilitation trust, which is funded by Sasol.
represent treasury shares for purposes of the basic earnings per share calculation.
If the shares are held through the consolidated funding companies (special purpose
entities), they are treated as treasury shares for purposes of the basic earnings per
share calculation. If the shares are held directly by the Black Public Invitation – Cash
option, they are not treated as treasury shares and are included in the calculation of the
weighted average number of shares for the purposes of the basic earnings per share
calculation.
Participants in the Black Public Invitation – Funded option, through the funding
company, Sasol Inzalo Public Funding (Pty) Limited, subscribed for 16,1 million Sasol
preferred ordinary shares. At 30 June 2009, 57 254 Sasol preferred ordinary shares,
which were not subscribed for by the Black Public, were issued to the facilitation trust,
which is funded by Sasol.
The Selected Participants, through the funding company, Sasol Inzalo Groups Funding
(Pty) Limited, subscribed for 8,4 million Sasol preferred ordinary shares. At 30 June
2009, 1,1 million Sasol preferred ordinary shares, which were not subscribed for by the
Selected Participants, were issued to the facilitation trust, which is funded by Sasol.
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The number of shares held by the funding companies and the number of shares held
by the facilitation trusts are as follows:
by the facilitation trusts are as follows:
The preferred ordinary shares subscribed for and issued to the consolidated funding
companies and facilitation trusts (special purpose entities) are accounted for as treasury
shares for the purposes of the basic earnings per share calculation. Treasury shares are
not treated as outstanding shares and as such these shares are excluded from the
calculation of the weighted average number of shares (refer IAS 33.IE2).
The Black Public Invitation – Cash option allowed members of the black public to invest
directly in Sasol through subscribing for a new class of ordinary shares, Sasol BEE
ordinary shares. The Sasol BEE ordinary shares have the same rights as existing
ordinary shares; however they cannot be traded for the first two years of the transaction
term of ten years and, for the rest of the transaction term, can only be traded between
black people and black groups. At the end o f the transaction term, the Sasol BEE
ordinary shares will automatically be Sasol ordinary shares and will then be listed on the
JSE Limited. At 30 June 2009, 16 097 BEE ordinary shares, which were not subscribed
for by the Black Public – Cash option, were issued to the facilitation trust, which is funded
by Sasol and consolidated as a special purpose entity. The remaining Sasol BEE
ordinary shares issued directly to the Black Public are not held through consolidated
special purpose entities.
The Sasol BEE ordinary shares form part of the ordinary shares and as such are
included in the calculation of the weighted average number of shares for the purposes of
the basic earnings per share calculation. The BEE ordinary shares issued to the
consolidated facilitation trust (special purpose entity) are accounted for as treasury
shares for the purposes of the basic earnings per share calculation. Treasury shares are
not treated as outstanding shares and as such these shares are excluded from the
calculation of the weighted average number of shares (refer IAS 33.IE2).
• Finally, please tell us how you considered the impact of these shares for purposes of
calculating diluted earnings per share. Refer to authoritative accounting literature as
appropriate.
companies and facilitation trusts (special purpose entities) are accounted for as treasury
shares for the purposes of the basic earnings per share calculation. Treasury shares are
not treated as outstanding shares and as such these shares are excluded from the
calculation of the weighted average number of shares (refer IAS 33.IE2).
The Black Public Invitation – Cash option allowed members of the black public to invest
directly in Sasol through subscribing for a new class of ordinary shares, Sasol BEE
ordinary shares. The Sasol BEE ordinary shares have the same rights as existing
ordinary shares; however they cannot be traded for the first two years of the transaction
term of ten years and, for the rest of the transaction term, can only be traded between
black people and black groups. At the end o f the transaction term, the Sasol BEE
ordinary shares will automatically be Sasol ordinary shares and will then be listed on the
JSE Limited. At 30 June 2009, 16 097 BEE ordinary shares, which were not subscribed
for by the Black Public – Cash option, were issued to the facilitation trust, which is funded
by Sasol and consolidated as a special purpose entity. The remaining Sasol BEE
ordinary shares issued directly to the Black Public are not held through consolidated
special purpose entities.
The Sasol BEE ordinary shares form part of the ordinary shares and as such are
included in the calculation of the weighted average number of shares for the purposes of
the basic earnings per share calculation. The BEE ordinary shares issued to the
consolidated facilitation trust (special purpose entity) are accounted for as treasury
shares for the purposes of the basic earnings per share calculation. Treasury shares are
not treated as outstanding shares and as such these shares are excluded from the
calculation of the weighted average number of shares (refer IAS 33.IE2).
• Finally, please tell us how you considered the impact of these shares for purposes of
calculating diluted earnings per share. Refer to authoritative accounting literature as
appropriate.
Response
The preferred ordinary shares subscribed for by the Black Public Invitation – Funded
option and the Selected Participants were accounted for as treasury shares for the
purposes of the basic earnings per share calculation. Treasury shares are not treated as
outstanding shares and as such these shares are excluded from the calculation of the
weighted average number of shares (refer IAS 33.IE2).
option and the Selected Participants were accounted for as treasury shares for the
purposes of the basic earnings per share calculation. Treasury shares are not treated as
outstanding shares and as such these shares are excluded from the calculation of the
weighted average number of shares (refer IAS 33.IE2).
Black public –
Funded option
Selected
Participants
At 30 June 2009
Number of shares
Number of shares
Shares and share rights issued
16 027 945
8 387 977
Shares and share right unissued at year end
57 254
1 073 905
Total subscribed for by funding company
16 085 199
9 461 882
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The preferred ordinary shares subscribed for by the Black Public Invitation – Funded
option and the Selected Participants were considered for the diluted earnings per share
calculation. The Sasol preferred ordinary shares will become Sasol ordinary shares after
10 years and will remain treasury shares within the current structure and were therefore
not considered to be dilutive on the earnings per share calculation.
Furthermore, consideration was given to the number of Sasol ordinary shares that would
be required to be issued to settle the A and B preference debt held by the funding
companies (refer note 43 on F-118 and F-119). It was noted that these preference debt
funding arrangements would have a potential dilutive impact on the earnings per share
calculation (refer IAS 33.58).
Participants in the Black Public – Cash option subscribed for Sasol BEE ordinary shares
directly in the Company. The Sasol BEE ordinary shares form part of the calculation of
the weighted average number of shares for the purposes of the basic earnings per share
calculation. No adjustment is made for the diluted weighted average number of shares
calculation in respect of these shares as they form part of the underlying basic earnings
per share calculation (refer IAS 33.36). The shares that have not been subscribed for at
30 June 2009 (16 097 Sasol BEE ordinary shares) are accounted for as treasury shares.
Treasury shares are not treated as outstanding shares and as such these shares are
excluded from the calculation of the weighted average number of shares (refer IAS
33.IE2). These shares are therefore excluded from the diluted weighted average number
of shares calculation as their impact on the diluted earnings per share calculation is not
considered to be significant.
option and the Selected Participants were considered for the diluted earnings per share
calculation. The Sasol preferred ordinary shares will become Sasol ordinary shares after
10 years and will remain treasury shares within the current structure and were therefore
not considered to be dilutive on the earnings per share calculation.
Furthermore, consideration was given to the number of Sasol ordinary shares that would
be required to be issued to settle the A and B preference debt held by the funding
companies (refer note 43 on F-118 and F-119). It was noted that these preference debt
funding arrangements would have a potential dilutive impact on the earnings per share
calculation (refer IAS 33.58).
Participants in the Black Public – Cash option subscribed for Sasol BEE ordinary shares
directly in the Company. The Sasol BEE ordinary shares form part of the calculation of
the weighted average number of shares for the purposes of the basic earnings per share
calculation. No adjustment is made for the diluted weighted average number of shares
calculation in respect of these shares as they form part of the underlying basic earnings
per share calculation (refer IAS 33.36). The shares that have not been subscribed for at
30 June 2009 (16 097 Sasol BEE ordinary shares) are accounted for as treasury shares.
Treasury shares are not treated as outstanding shares and as such these shares are
excluded from the calculation of the weighted average number of shares (refer IAS
33.IE2). These shares are therefore excluded from the diluted weighted average number
of shares calculation as their impact on the diluted earnings per share calculation is not
considered to be significant.
3. We note your response to comment three of our letter dated March 2, 2010 which
indicates that fair value of the share based payment expense in respect of the Black Public
Invitation – funded option included an exercise price assumption of R366 per share. We
further note your disclosure that the Black Public contributed equity between 5% to 10% of
the underlying Sasol preferred ordinary shares allocation. Please clarify how much of the
R366 price per share you received or expect to receive from the Black Public Invitation –
funded and whether this amount equates to the 5% to 10% figure noted above. Similar
concerns apply to the Selected Participants preferred share issuance.
Invitation – funded option included an exercise price assumption of R366 per share. We
further note your disclosure that the Black Public contributed equity between 5% to 10% of
the underlying Sasol preferred ordinary shares allocation. Please clarify how much of the
R366 price per share you received or expect to receive from the Black Public Invitation –
funded and whether this amount equates to the 5% to 10% figure noted above. Similar
concerns apply to the Selected Participants preferred share issuance.
Response
The following table provides an analysis of the equity contributions received in cash from
participants in the Black Public – Funded option and the Selected Participants for the
Sasol preferred ordinary shares subscribed for by the funding companies compared to the
Sasol preferred ordinary shares subscribed for by the funding companies at an issue price
of R366 per share.
participants in the Black Public – Funded option and the Selected Participants for the
Sasol preferred ordinary shares subscribed for by the funding companies compared to the
Sasol preferred ordinary shares subscribed for by the funding companies at an issue price
of R366 per share.
Black public –
Funded option
R
Selected
Participants
R
At 30 June 2009
Shares subscribed for at R366 per share
5 887 182 834
3 463 048 812
Equity contributions from participants
370 927 750
204 150 000
Contributed equity %
6%
6%
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4. We note your disclosures that the 34.7 million ordinary shares and the 25.5 million
preferred shares subscribed for and issued to special purposes entities have certain
dividend rights. Please tell us how you considered whether such securities are
participating equity instruments which require calculation of EPS using the two-class
method. Refer to paragraph A13 – A14 of IAS 33
Response
dividend rights. Please tell us how you considered whether such securities are
participating equity instruments which require calculation of EPS using the two-class
method. Refer to paragraph A13 – A14 of IAS 33
Response
The ordinary shares (34,7 million weighted average number of shares), preferred ordinary
shares (25,5 million actual number of shares and 22,5 million weighted average number of
shares) and Sasol BEE ordinary shares (16 097 weighted average number of shares)
subscribed for and issued to consolidated special purpose entities in terms of the Sasol
Inzalo share transaction are included in treasury shares. Treasury shares are not treated
as outstanding shares and as such these shares are excluded from the calculation of
weighted average number of shares (refer IAS 33.IE2). Therefore, all shares included in
the basic EPS calculation have the same dividend rights.
After the transaction term of ten years there is only one class of ordinary share as the
preferred ordinary shares would have become ordinary shares. For purposes of dilutive
EPS, all the dividend rights are therefore the same afte r the end of the transaction term of
ten years (refer to F-122). IAS33.A14 is thus not applicable.
In addition, please clarify when the Trusts and participants are eligible to receive dividends
associated with these shares and specify the impact to the Trusts and participants if the
participants terminate their employment with the company prior to full vesting or if such
shares are repurchased by the company. In doing so, please specify if the Trusts receive
dividends for all shares held by the Trusts or only shares in which participants have
vested. Finally, tell us how you account for dividends paid to the Trusts.
shares (25,5 million actual number of shares and 22,5 million weighted average number of
shares) and Sasol BEE ordinary shares (16 097 weighted average number of shares)
subscribed for and issued to consolidated special purpose entities in terms of the Sasol
Inzalo share transaction are included in treasury shares. Treasury shares are not treated
as outstanding shares and as such these shares are excluded from the calculation of
weighted average number of shares (refer IAS 33.IE2). Therefore, all shares included in
the basic EPS calculation have the same dividend rights.
After the transaction term of ten years there is only one class of ordinary share as the
preferred ordinary shares would have become ordinary shares. For purposes of dilutive
EPS, all the dividend rights are therefore the same afte r the end of the transaction term of
ten years (refer to F-122). IAS33.A14 is thus not applicable.
In addition, please clarify when the Trusts and participants are eligible to receive dividends
associated with these shares and specify the impact to the Trusts and participants if the
participants terminate their employment with the company prior to full vesting or if such
shares are repurchased by the company. In doing so, please specify if the Trusts receive
dividends for all shares held by the Trusts or only shares in which participants have
vested. Finally, tell us how you account for dividends paid to the Trusts.
Response
Participants in the Employee Trusts have been granted vested rights to Sasol ordinary
shares. These rights, which entitled the employees from the inception of the scheme to
receive ordinary shares at the end of the ten years vest according to the unconditional
entitlement as follows:
• After three years: 30%
• Thereafter: 10% per year until maturity
The participants in the Employee Trusts have the right to all ordinary dividends received
by the Employee Trusts for the duration of the transaction (refer Item 5 “The Sasol Inzalo
Employee Trust and The Sasol Inzalo Management Trust”, page 136 of Form 20-F for the
year ended 30 June 2009). The Employee Trusts have a right to receive 50% of the
ordinary dividends paid on all Sasol ordinary shares held by the trusts.
Dividends received are recognised when the shareholder’s right to receive a dividend is
established, normally when the dividend is declared by the Company. The trustees of the
Employee Trusts will simultaneously approve the distribution to the participants and the
Employee Trusts will recognise the dividends paid. On a consolidated basis, the Company
only recognised that portion of the dividend paid to the participants of the Employee Trusts
as the Employee Trusts are consolidated special purpose entities.
Participants in the Employee Trusts have been granted vested rights to Sasol ordinary
shares. These rights, which entitled the employees from the inception of the scheme to
receive ordinary shares at the end of the ten years vest according to the unconditional
entitlement as follows:
• After three years: 30%
• Thereafter: 10% per year until maturity
The participants in the Employee Trusts have the right to all ordinary dividends received
by the Employee Trusts for the duration of the transaction (refer Item 5 “The Sasol Inzalo
Employee Trust and The Sasol Inzalo Management Trust”, page 136 of Form 20-F for the
year ended 30 June 2009). The Employee Trusts have a right to receive 50% of the
ordinary dividends paid on all Sasol ordinary shares held by the trusts.
Dividends received are recognised when the shareholder’s right to receive a dividend is
established, normally when the dividend is declared by the Company. The trustees of the
Employee Trusts will simultaneously approve the distribution to the participants and the
Employee Trusts will recognise the dividends paid. On a consolidated basis, the Company
only recognised that portion of the dividend paid to the participants of the Employee Trusts
as the Employee Trusts are consolidated special purpose entities.
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page 8 of 8
On resignation, within the first three years from the inception of the transaction, share
rights granted will be forfeited. For each year thereafter, 10% of such share rights will be
forfeited for each year or part thereof remaining until the end of the transaction period. On
retirement, death or retrenchment the rights remain with the participant.
Participants who leave the employ of the Company during the term of the transaction by
reason of dismissal forfeit all their rights to Sasol ordinary shares.
Forfeited rights to Sasol ordinary shares are allocated to new eligible Sasol employees.
Dividends relating to unallocated rights are not paid and are eliminated on consolidation.
We appreciate the Staff’s review of the Form 20-F for the year ended 30 June 2009. Should
the Staff have any questions or require any additional information, please telephone the
undersigned at +27-11-441-3435. My email address is christine.ramon@sasol.com.
rights granted will be forfeited. For each year thereafter, 10% of such share rights will be
forfeited for each year or part thereof remaining until the end of the transaction period. On
retirement, death or retrenchment the rights remain with the participant.
Participants who leave the employ of the Company during the term of the transaction by
reason of dismissal forfeit all their rights to Sasol ordinary shares.
Forfeited rights to Sasol ordinary shares are allocated to new eligible Sasol employees.
Dividends relating to unallocated rights are not paid and are eliminated on consolidation.
We appreciate the Staff’s review of the Form 20-F for the year ended 30 June 2009. Should
the Staff have any questions or require any additional information, please telephone the
undersigned at +27-11-441-3435. My email address is christine.ramon@sasol.com.
Yours faithfully
/s/ Kandimathie Christine Ramon
Christine Ramon
Chief Financial Officer
Chief Financial Officer