Caledonia Mining Corp Plc | CIK:0000766011 |

The Group has expensed the following Equity-settled share-based payment arrangements for the year ended

 

		Note		2017				2016				2015
Share option programmes		23.1(a)			29				170				24
Facilitation and advanced dividend loan modification		23.1(b)			806				-				-
					835				170				24

 

 

. the greater of volume weighted average trading price for the days prior to grant or the closing price on the day immediately prior to the date of grant. The options

 

The maximum term of the options under the OEICP is years and under the RSOP years. The terms and conditions relating to the grant of options under the RSOP are that all options are to be settled by physical delivery of shares. Equity settled share based payments under the OEICP will also be settled by physical delivery of shares. Under both plans the aggregate number of shares that be issued pursuant to the grant of options, or under any other share compensation arrangements of the Company, will exceed of the aggregate issued and outstanding shares issued of the Company.

 

At the Company has the following options outstanding:

Number of Options				Exercise Price				Expiry Date
				Canadian $
	5,000				4.00			Oct 8, 2020
	18,000				11.50			Oct 13, 2021
	5,000				8.10			May 30, 2022
	28,000

 

The continuity of the options granted, exercised, cancelled and expired under the Plan were as follows:

 

		Number of Options *				Weighted Avg. Exercise Price
						Canadian $ *
Options outstanding and exercisable at January 1, 2015			513,184				5.55
Expired or forfeited			(88,000	)			5.55
Granted			23,000				3.65
Options outstanding and exercisable at December 31, 2015			448,184				5.40
Expired or forfeited			(232,200	)			6.50
Granted			18,000				11.50
Exercised			(141,704	)			4.15
Options outstanding and exercisable at December 31, 2016			92,280				5.85
Granted			5,000				8.10
Exercised			(69,280	)			4.50
Options outstanding and exercisable at December 31, 2017			28,000				9.55

 

* Amounts stated after the share consolidation, refer note

 

The weighted average remaining contractual life of the outstanding options is years ( years; years).

 

 

		2017		2016		2015		2015
Options granted		*5,000		*18,000		90,000		25,000
Grant date		May 30, 2017		October 13, 2016		December 21, 2015		October 7, 2015
Risk-free interest rate		2.40%		0.53%		0.53%		0.53%
Expected stock price volatility (based on historical volatility)		118%		119%		41,2%		39,6%
Expected option life in years		3		5		5		5
Exercise price		* CAD 8.10		* CAD 11.50		CAD 0.74		CAD 0.80
Share price at grant date		* CAD8.10		* CAD 11.50		CAD 0.74		CAD 0.79
Fair value at grant date		* USD 5.81		* USD 9.45		USD 0.27		USD 0.27

 

On a grant of share options was made to Mr. J Staiger, who provides investor relations services in continental Europe for the Company. The exercise price was determined as the prevailing Toronto Stock Exchange share price on the day of the grant. Expected volatility has been based on an evaluation of the historical volatility of the Company’s share price. The expected term has been based on historical experience. The share based payment expense relating to the grant amounted to

 

* Amounts stated after the share consolidation, refer note

 

 

On the Group, Blanket Mine and the Indigenous Shareholders reached agreement to change the interest rate on the facilitation and advanced dividend loans from the previously agreed month LIBOR + to the lower of a fixed rate of per annum, payable quarterly or of the dividends paid in the financial quarter. The modification was beneficial to the Indigenisation Shareholders and resulted in an equity-settled share-based payment expense of The Monte Carlo simulation approach was followed to value the fair value of the Indigenisation Shareholders’ equity before and after the modification date. The fair value of the Indigenisation Shareholders’ equity was based on simulating the future Blanket Mine dividend yields.

 

The following assumptions were used in determining modification of the expense:

 

Modification date		June 23, 2017
Blanket Mine dividend yield		23.70%	-	89.88%
Risk free interest rate		USD swap curve
Group market capitalisation at grant date ($’000)		USD 68,436

 

		Note		2017				2016				2015
Restricted Share units and Performance Share Units		23.2(a)			853				618				-
Caledonia Mining South Africa employee incentive scheme		23.2(b)			123				-				-
					976				618				-

 

Certain key management members were granted Restricted Share units (“RSU’s”) and Performance Share Units (” PSU’s”) pursuant to provisions of the Omnibus Equity Incentive Compensation Plan. All RSU’s and PSU’s were granted and approved by the Compensation Committee of the Board of Directors.

 

The RSU’s will vest years after grant date given that the service condition of the relevant employees are fulfilled. The value of the vested RSU’s will be the number of RSU’s vested multiplied by the fair market value of the Company’s shares, as specified by the plan, on date of settlement.

 

The PSU’s have a service condition and a performance period of years. The performance condition is a function of production cost, gold production and central shaft depth targets on certain specified dates. The number of PSU’s that will vest will be the PSU granted multiplied by the Performance Multiplier, which will reflect the actual performance in terms of the performance conditions compared to expectations on the date of the award.

 

RSU holders are entitled to receive dividends over the vesting period. Such dividends will be reinvested in additional RSU’s at the then applicable share price calculated at the average Bank of Canada noon rate immediately preceding the dividend payment. PSU’s have rights to dividends only after they have vested.

 

The fair value of the RSU’s, at the reporting date, was based on the Black Scholes option valuation model. The fair value of the PSU’s, at the reporting date, was based on the Black Scholes option valuation model less the fair value of the expected dividends during the vesting period multiplied by the performance multiplier expectation. At the reporting date it was assumed that there is a probability that the performance conditions will be met and therefore a performance multiplier was used in calculating the estimated liability. The liability as at amounted to (). Included in the liability as at is an amount of ( ) that was expensed and classified as production costs, refer note

 

The following assumptions were used in estimating the fair value of the cash settled share-based payment liability on

 

			*2017								*2016
			RSUs				PSUs				RSUs				PSUs
Fair value (USD)		$	7.37			$	7.17			$	5.50			$	5.25
Share price (USD)		$	7.37			$	7.37			$	5.50			$	5.50
Performance multiplier percentage			-				94	%			-				100	%

 

 

		RSUs				PSUs				RSUs				PSUs
Grant - January 11, 2016			60,645				242,579				60,645				242,579
Grant - March 23, 2016			10,965				43,871				10,967				43,871
Grant - June 8, 2016			5,117				20,470				5,117				20,470
Grant - January 19, 2017			4,443				17,774				-				-
RSU dividend reinvestments			7,324				-				3,505				-
Total awards at December 31			88,494				324,694				80,234				306,920

 

 

 

In the Group granted cash-settled share awards to certain employees based in South Africa. These cash-settled share awards will vest in equal tranches on and subject to the employees fulfilling their service condition. The cash-settled share-based payment liability was calculated based on the number of awards expected to vest multiplied by the Company’s Black Scholes option valuation fair value of at the reporting date. The liability relating to these cash-settled share based payment awards amounted to ( ) and the expense amounted to ( ) for the year ended of the cash-settled share awards vested on and an amount of was paid out to these employees.