PharmaEngine : Announcement that the Company's Board of Directors resolved to issue restricted stock awards (RSA)

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Provided by: PharmaEngine, Inc.
SEQ_NO	10	Date of announcement	2022/03/08	Time of announcement	18:19:18
Subject	Announcement that the Company's Board of Directors resolved to issue restricted stock awards (RSA)
Date of events	2022/03/08	To which item it meets	paragraph 11
Statement	1.Resolution date of the board of directors:2022/03/08 2.Expected issue price:Issued for employees gratuitously. 3.Expected total amount (shares) of issuance:No more than 100 thousand common shares, each with a per value of NT$ 10, for a total amount of NT$1,000 thousand. 4.Vesting conditions: The highest percentages of shares that employees who are employed on the vesting date after receiving the RSA, and within the vesting period, can be vested with on the vesting date each year are: 40%, 30%, and 30% for 1st year completed, 2nd year completed, and 3rd year completed, respectively. 5.Measures to be taken when employees fail to meet the vesting conditions or in the event of inheritance: The Company will redeem and cancel the RSA when employees fail to meet the vesting conditions excluding leave without pay, disability or death caused by work injury, in accordance with the Company's employment agreement, work rules and Company's issuance guidelines. (1) Voluntary resignation, death, severance package, and retirement: All rights for unvested stock warrants shall be deemed as waived upon the date of such occurrence. (2) Leave without pay: For optionees who have been approved by the Company for leave without pay pursuant to the relevant laws and regulations. Rights and interests to any unvested stock warrants shall be restored upon reinstatement. However, the vesting period shall be deferred retroactively by the same duration as the period of leave without pay. (3) Disability or death caused by work injury: In the event that an employee becomes physically disabled and cannot continue his/her employment due to work injury, he/she may exercise all options at the time of resignation. However, such options may only be exercised from the date of resignation or after one years have elapsed since the granting of such stock warrants (whichever is later). 6.Other issuance criteria:New common shares issued by the Company shall be delivered. Implemented at once or in batches within one year since the date of receipt for notice of the competent authority's approval and effectiveness. The Chairman is authorized to determine the actual issue date. 7.Qualification criteria for employees: (1) Those operation-related employees who serve full-time in the Company. The number of RSA and employees to whom they're granted shall be determined by each employee's seniority, position, performance, overall contribution, specific achievements, or other conditions necessary for management. The aforementioned shall be proposed by the GM/CEO and reviewed by the Chairman and then submitted to the Board of Directors for resolution. However, for employees who are managerial officers and (or) directors, approval by the Compensation Committee must be obtained first. (2) The cumulative no. of shares a single employee can subscribe for by exercising the options granted to him/her by the Company under Paragraph 1, Article 56-1 of the Regulations Governing the Offering and Issuance of Securities by Securities Issuers, in combination with the cumulative no. of restricted stock awards obtained by such employee, shall not exceed 0.3% of the total issued shares. The above, in combination with the cumulative no. of shares such employee can subscribe for by exercising the stock warrants granted under Paragraph 1, Article 56 shall not exceed 1% of the total issued shares. 8.The reason the current issuance of RSA is necessary: To attract and retain talents, encourage employees and enhance their cohesion, jointly create benefits for the Company and shareholders, and ensure the alignment of interests for both the Company's employees and shareholders. 9.Calculated expense amount:The calculated expense amount is approximately NT$7,360 thousand based on the closing price of NT$ 73.6 for common shares on February 24, 2022. 10.Dilution of the Company's earnings per share (EPS): The expense amount is estimated to be NT$2,944 thousand for 1st year, NT$2,208 thousand for 2nd year, NT$2,208 thousand for 3rd year, and. Based on the calculation of the Company's outstanding shares (143,596,840 shares), the maximum reduction of the Company's EPS is estimated to be approximately NT$ 0.021 for 1st year, NT$ 0.015 for 2nd year, NT$ 0.015 for 3rd year, respectively. There is a limited dilution of the Company's EPS, and there is no material impact on shareholders' equity. 11.Other matters affecting shareholder's equity:NA 12.Restrictions before employees meet the vesting conditions once the RSA are received or subscribed for: (1) During the vesting period, employees may not sell, pledge, transfer, give away to others, provide as collaterals, or otherwise dispose of the RSA. (2) Before employees reach the vesting conditions, shall not have the attendance, proposal, expression, voting rights, distribution of shares, cash dividends and other matters regarding shareholders' rights and interests. (3) The period from fifteen business days prior to the date when the Company applies with TPEx for the book closure date for gratuitous distribution of stock dividends, book closure date for cash dividends, or subscription book closure date for cash capital increase, the statutory book closure period before the shareholder's meeting of the current year and other statutory book closure periods up until the record date for distribution of rights and interests. Employees reach the vesting conditions during the period described above, shall not have the voting rights and participation in a distribution of share or cash dividends. 13.Other important terms and conditions (including stock trust custody, etc.):The RSA issued by the Company may be handled by stock trust custody. 14.Any other matters that need to be specified: (1) These guidelines shall come into effect once they're approved by a majority vote in a Board of Directors meeting attended by two-thirds or more of the directors, and approval is granted by the competent authority upon reporting. The Chairman is authorized to revise the regulations if such revisions or amendments have to be made due to the competent authority's instruction upon review. These guidelines will be issued once ratified by the Board of Director. (2) Any other matters not set forth in these guidelines shall be dealt with in accordance with the related laws and regulations.