HTC 2015 Annual Report Download - page 67

Capital and shares
Capital and shares
130
131
6. New Restricted Employee Shares
(1) Issuance of restricted employee shares and impact to
shareholders’ equity
2016.03.31/Unit:ShareandNT$
Restricted Employee
Shares Granted 1st Restricted employee shares 2nd Restricted employee shares 3rd Restricted employee shares
Approval Date 2014.08.19 2014.08.19 2015.08.19
Issue(Vest)Date 2014.11.02 2015.08.10 2015.12.23
Number of Restricted
EmployeeSharesIssued 4,600,000shares 400,000 shares 4,006,000shares
IssuedPriceperShare NTD 0 NTD 0 NTD 0
PercentageofShares
Exercisable to Outstand-
ing Common Shares
0.56% 0.05% 0.48%
Vesting Conditions for
Exercise of Restricted
Employee Shares
1. An employee who remains employed
at HTC after 1 year has elapsed from
the time of the award of the new
restricted employee shares (i.e., the
record date of the capital increase),
and who in the then-current fiscal
year has a performance rating equal to
or higher than "Satisfactory," will be
eligible for vesting of an installment of
30%oftheshares.
2. An employee who remains employed
at HTC after 2 years have elapsed
from the time of the award of the new
restricted employee shares (i.e., the
record date of the capital increase),
and who in the then-current fiscal
year has a performance rating equal to
or higher than “Satisfactory,” will be
eligible for vesting of an installment of
30%oftheshares.
3. Anemployeewhoremainsemployed
atHTCafter3yearshaveelapsed
from the time of the award of the new
restricted employee shares (i.e., the
record date of the capital increase),
and who in the then-current fiscal
year has a performance rating equal to
or higher than “Satisfactory,” will be
eligible for vesting of an installment of
40%oftheshares.
1. An employee who remains employed
at HTC after 1 year has elapsed from
the time of the award of the new
restricted employee shares (i.e., the
record date of the capital increase),
and who in the then-current fiscal
year has a performance rating equal to
or higher than "Satisfactory," will be
eligible for vesting of an installment of
30%oftheshares.
2. An employee who remains employed
at HTC after 2 years have elapsed
from the time of the award of the new
restricted employee shares (i.e., the
record date of the capital increase),
and who in the then-current fiscal
year has a performance rating equal to
or higher than “Satisfactory,” will be
eligible for vesting of an installment of
30%oftheshares.
3. Anemployeewhoremainsemployed
atHTCafter3yearshaveelapsed
from the time of the award of the new
restricted employee shares (i.e., the
record date of the capital increase),
and who in the then-current fiscal
year has a performance rating equal to
or higher than “Satisfactory,” will be
eligible for vesting of an installment of
40%oftheshares.
1. An employee who remains employed at
HTC after 1 year has elapsed from the
time of the award of the new restricted
employee shares (i.e., the record date
of the capital increase), and who in
the then-current fiscal year has a
performance rating equal to or higher
than "Satisfactory," will be eligible for
vestingofaninstallmentof30%ofthe
shares.
2. An employee who remains employed
at HTC after 2 years have elapsed
from the time of the award of the new
restricted employee shares (i.e., the
record date of the capital increase), and
who in the then-current fiscal year has
a performance rating equal to or higher
than “Satisfactory,” will be eligible for
vestingofaninstallmentof30%ofthe
shares.
3. Anemployeewhoremainsemployed
atHTCafter3yearshaveelapsed
from the time of the award of the new
restricted employee shares (i.e., the
record date of the capital increase), and
who in the then-current fiscal year has
a performance rating equal to or higher
than “Satisfactory,” will be eligible for
vestingofaninstallmentof40%ofthe
shares.
Restrictions to the Rights
of New Restricted Em-
ployee Shares
The shares to be issued and awarded to
employees in the current issue are com-
mon shares. The rights and obligations
associated with the shares are the same
as those of other issued and outstanding
common stock, except as specified as fol-
lows:
1. During the vesting period, an em-
ployee may not sell, pledge, transfer,
give to another person, create any
encumbrance on, or otherwise dispose
of, new restricted employee shares.
2. During the vesting period, the new
restricted employee shares can still
participate in stock and cash dividends
and subscription to cash rights issues.
The stock and cash dividends and cash
rights issue subscriptions so obtained
furthermore need not be placed in
trust and shall not be restricted by the
vesting period.
The shares to be issued and awarded to
employees in the current issue are com-
mon shares. The rights and obligations
associated with the shares are the same
as those of other issued and outstanding
common stock, except as specified as fol-
lows:
1. During the vesting period, an em-
ployee may not sell, pledge, transfer,
give to another person, create any
encumbrance on, or otherwise dispose
of, new restricted employee shares.
2. During the vesting period, the new
restricted employee shares can still
participate in stock and cash dividends
and subscription to cash rights issues.
The stock and cash dividends and cash
rights issue subscriptions so obtained
furthermore need not be placed in
trust and shall not be restricted by the
vesting period.
The shares to be issued and awarded to
employees in the current issue are com-
mon shares. The rights and obligations
associated with the shares are the same
as those of other issued and outstanding
common stock, except as specified as fol-
lows:
1. During the vesting period, an employee
may not sell, pledge, transfer, give to
another person, create any encum-
brance on, or otherwise dispose of, new
restricted employee shares.
2. During the vesting period, the new
restricted employee shares can still
participate in stock and cash dividends
and subscription to cash rights issues.
The stock and cash dividends and cash
rights issue subscriptions so obtained
furthermore need not be placed in
trust and shall not be restricted by the
vesting period.
Custody of Restricted
Employee Shares
1. After new restricted employee shares
are issued, if the employee to whom
shares have been awarded is an ROC
national, the shares must immediately
bedepositedintrust.Iftheemployee
to whom shares are awarded is a
foreign national, the shares must be
placed in custody with a custodian
bank. Further, before the vesting con-
ditions have been met, the employee
may not for any reason or in any man-
ner request that the trustee return the
new restricted employee shares.
2. During the period in which the new
restricted employee shares are placed
in trust, HTC shall have full discretion
to act as agent for the employee to con-
duct with the share trust institution
matters including, without limitation,
the negotiation, signing, amendment,
extension, rescission, and termination
of the trust agreement, and giving of
instructions for the delivery, utiliza-
tion, or disposition of the assets in
trust.
1. After new restricted employee shares
are issued, if the employee to whom
shares have been awarded is an ROC
national, the shares must immediately
bedepositedintrust.Iftheemployee
to whom shares are awarded is a
foreign national, the shares must be
placed in custody with a custodian
bank. Further, before the vesting con-
ditions have been met, the employee
may not for any reason or in any man-
ner request that the trustee return the
new restricted employee shares.
2. During the period in which the new
restricted employee shares are placed
in trust, HTC shall have full discretion
to act as agent for the employee to con-
duct with the share trust institution
matters including, without limitation,
the negotiation, signing, amendment,
extension, rescission, and termination
of the trust agreement, and giving of
instructions for the delivery, utiliza-
tion, or disposition of the assets in
trust.
1. After new restricted employee shares
are issued, if the employee to whom
shares have been awarded is an ROC
national, the shares must immediately
bedepositedintrust.Iftheemployeeto
whom shares are awarded is a foreign
national, the shares must be placed in
custody with a custodian bank. Further,
before the vesting conditions have been
met, the employee may not for any
reason or in any manner request that
the trustee return the new restricted
employee shares.
2. During the period in which the new
restricted employee shares are placed
in trust, HTC shall have full discretion
to act as agent for the employee to
conduct with the share trust institution
matters including, without limitation,
the negotiation, signing, amendment,
extension, rescission, and termination
of the trust agreement, and giving of in-
structions for the delivery, utilization,
or disposition of the assets in trust.
ProceduresforNon-
Compliance of the Condi-
tions
1. Ifanemployeevoluntarilyresignsor
his or her employment is terminated
or severed, then the vesting rights of
any shares previously awarded to the
employee but not yet vested shall be
lost from the date of occurrence of the
fact. HTC will withdraw and cancel
the full number of the shares without
compensation.
2. Any cash or property other than cash
received as a return of share capital
due to HTC having undergone a capital
reduction during the vesting period:
HTC will withdraw the full amount
without compensation.
1. Ifanemployeevoluntarilyresignsor
his or her employment is terminated
or severed, then the vesting rights of
any shares previously awarded to the
employee but not yet vested shall be
lost from the date of occurrence of the
fact. HTC will withdraw and cancel
the full number of the shares without
compensation.
2. Any cash or property other than cash
received as a return of share capital
due to HTC having undergone a capital
reduction during the vesting period:
HTC will withdraw the full amount
without compensation.
1. Ifanemployeevoluntarilyresignsor
his or her employment is terminated
or severed, then the vesting rights of
any shares previously awarded to the
employee but not yet vested shall be
lost from the date of occurrence of the
fact. HTC will withdraw and cancel
the full number of the shares without
compensation.
2. Any cash or property other than cash
received as a return of share capital
due to HTC having undergone a capital
reduction during the vesting period:
HTC will withdraw the full amount
without compensation.
Withdrawal of New Re-
stricted Employee Shares 786,570shares 0 shares 128,500 shares
Unrestricted New Re-
stricted Employee Shares 1,123,550shares 0 shares 13,000shares
Restricted New Re-
stricted Employee Shares 2,689,880shares 400,000 shares 3,864,500shares
PercentageofSharesUn-
restricted to Outstanding
Common Shares
0.33% 0.05% 0.47%
ImpactonShareholders’
Equity Dilution to shareholder’s equity is limited Dilution to shareholder’s equity is limited Dilution to shareholder’s equity is limited
Note:Theinformationiscalculatedbasedontheissuedshares,827,641,465.
(Continued)
2016.03.31/Unit:ShareandNT$