Polaris : Board of Directors resolved to issue employee stock options certificates

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Provided by: Polaris Group
SEQ_NO	5	Date of announcement	2022/08/16	Time of announcement	17:58:21
Subject	Board of Directors resolved to issue employee stock options certificates
Date of events	2022/08/16	To which item it meets	paragraph 11
Statement	1.Date of the board of directors resolution:2022/08/16 2.Issuance period:Within one year since the date of receipt for notice of the competent authority's approval and effectiveness; issued at once or in tranches depending on actual demands. The Chairman is authorized to determine the actual issue date. 3.Eligibility criteria for optionees: (a)To be limited to formal full-time employees of the Company and full-time employees of the Company's subsidiaries, which means any company in which more than 50% of its total number of voting shares are directly or indirectly held by the Company, recorded on the subscription qualification record date.The subscription qualification record date is determined by the Chairman. The Chairman shall propose and submit to the Board of Directors for the approval of the list of the qualified Employee(s) who is eligible to be granted with the Option (the "Optionee") and of the number of Shares which such Optionee may subscribe to, by reference to the following aspects, including without limitation, his or her working experience, seniority, position degree, performance, and overall contribution or special achievement,etc. An employee who is a managerial officer or a director who has an employee's status shall first submit to the Remuneration Committee of a Company and then to the Board of Directors to meet the qualification. (b))The Company issues employee stock options under"Regulations Governing the Offering and Issuance of Securities by Securities Issuers"(the "Regulation") Article 56-1, paragraph 1, the cumulative number of shares to be subscribed by the Optionee of the employee stock options, in combination with the cumulative number of new restricted employee shares obtained by the Optionee, may not exceed 0.3 percent of the issuer's total issued shares. And the above in combination with the cumulative number of shares to be subscribed by the Optionee of employee stock options issued by an issuer under the Regulation Article 56, paragraph 1, may not exceed 1 percent of the issuer's total issued shares. However, with special approval from thecentral competent authority of the relevant industry, the total number of employee stock options and new restricted employee shares obtained by a single employee may be exempted from the above-mentioned restriction. 4.Number of total issued units of the employee stock warrants: The total number of options to be granted is 4,000,000 units. 5.Number of shares each stock warrant unit may subscribe for: Each stock warrant unit may subscribe for 1 common share of the Company. 6.Total number of new shares to be issued due to exercise of options, or the no.of shares for shares buyback as required by Article 28-2 of the Securities and Exchange Act: The total number of new shares to be issued for the exercise of these options shall be 4,000,000 shares. 7.Subscription price: The exercise price shall not be lower than the weighted average trade price for the company's common shares during the period of 30 business days preceding the price determination date, and shall not be lower than the net value per share in the financial reports audited or reviewed by a CPA issued for the most recent period. When the date of issuance the Company is already exchange-listed or OTC-listed, the exercise price shall not be lower than the closing price of the company stocks as of the issuing date. 8.Period of subscription rights: (a)The employee's stock options are valid for 10 years (the "Term"). Upon and after expiration of the Term, any unexercised subscription right shall be deemed to have waived. The Optionee shall not claim for exercising such unexercised right. The options and the rights and interests thereon shall not be transferred, pledged or donated to other persons or otherwise disposed of, except by inheritance. (b)The Options shall become exercisable pursuant to the vesting schedule, percentage set forth below and other terms and conditions set forth in this Plan from the secondary anniversary of the date when the option is grant to such Optionee. After 2 years (starting from the 3rd year) /50% After 3 years (starting from the 4th year) /75% After 4 years (starting from the 5th year) /100% (c)If the Company has been merged or acquired by Person or Group in a single transaction or in a series of related transactions and the Person or Group directly or indirectly acquires more than fifty percent (50%) of the combined voting power of the Company's shares, the entire Options will be exercised in advance before the effective date of the Merge& Acquiristion transaction, which means the options not yet vested are not subject to the subscription percentage restriction in Article 5, Paragraph 2, Item 2 of the Plan. The options exercise date shall prior to the effective time of such Corporate Transaction and the Board of Directors shall determine (or, if the Board of Directors shall not determine such a date, to the date that is five (5) days prior to the effective date of the Corporate Transaction). 9.Types of shares which may be subscribed for: Common shares of the Company. 10.Handling method for employee resignation/inheritance: (a)Job-Leaving (including voluntary resignation, retirement, lay off or fire for any reason): For the Options that are already vested on the date of job-leaving, such Optionee may exercise his or her Options within ninety days of the date of job-leaving, except the circumstances set forth in Article 8,Paragraph1, under which the exercise period shall be deferred accordingly. For the Options that are not vested on the date of job-leaving, the right of Optionee to exercise his or her Options to subscribe the Shares shall be deemed waived on the date of job-leaving. (b)Death: If the Optionee dies during the employment period, the vested Options, subject to the Term, may be exercised by the heir within 18 months following such Optionee's death. (c)Disability or Death Resulting from Occupational Suffering: (i)For the options already vested to an employee who cannot continue to work because of disability as a result of occupational hazard, such options may be exercisable on the date on which it is confirmed that the Optionee cannot be reinstated. Except for the restriction that the subscription right may be exercised after the 2nd anniversary of the options vested to the employees, the options not yet vested are not subject to the subscription percentage restriction in Article 5, Paragraph 2, Item 2 of the Plan. Such options may be exercisable within one year after the date on which it is confirmed that the Optionee cannot be reinstated or after the 2nd anniversary of the issuance date of the option, whichever is later, up to the end of the Term. (ii)For the options already vested to an employee died as a result of occupational hazards, such options may be exercisable on the date on which the heir acquires the right of inheritance. Except for the restriction that the subscription right may be exercised after the 2nd anniversary of the options vested to the employees, the options not yet vested are not subject to the subscription percentage restriction in Article 5, Paragraph 2, Item 2 of the Plan. Such options may be exercisable within one year after the date of death or after the 2nd anniversary of the issuance date of the option, whichever is later, up to the end of the Term. (d)Leave of absence without Pay For the Options already vested to the Optionee who takes leave of absence without pay under the approval of the Company due to following reasons, including without limitation, requirement of the laws and regulations, suffering from a dread disease, material change of family, study abroad, such Options may be exercised within three months from the date of leave of absence, except the circumstances set forth in Article 8,Paragraph 1, under which the exercise period shall be deferred accordingly. For the Options not yet vested on the date of leave of absence, subject to the Term, the exercise period set forth herein shall suspend during the period of leave of absence without pay, and shall be resumed after such Optionee's reinstatement. (e)In case that the Optionee or his or her or heir fails to exercise the right to subscribe the Shares within the aforesaid periods, it shall be deemed as a waiver of the unexercised Options. 11.Other criteria for subscription:None. 12.Method for performance of contract:The Company shall issue the new shares for delivery upon exercise of the option hereunder. 13.Adjustment of subscription price: (a)After the option have been granted, except for the issuance of various securities with common shares conversion rights or options issued by the bonus, Company for common shares or the Company issues new shares for employees'in case of any change in the amount of the common shares of the Company (including of the private placement) (i.e., capital increase by cash, recapitalization of earnings, recapitalization of capital surplus, merger of the Company, transferred the Company shares issued new shares, company segmentation, split of stocks, participating in the offering of global depositary receipt through rights issue), the exercise price shall be adjusted based on the following formula (to be rounded up to the nearest NT$ 0.1) adjusted Exercise Price = Exercise Price before adjustment × [number of issued and outstanding Shares + (subscription price per new Share × number of new Shares ) / the current market price per Share ] / ( number of issued and outstanding Shares + number of new Shares ) Note： (i)The number of issued and outstanding Shares shall mean the total number of issued and outstanding common Shares (including private placement shares), excluding number of Shares of bond conversion entitlement certificates, deducting treasury stocks which the Company has bought back but has not transferred or cancelled. (ii)In the event the new shares are distributed gratis or resulting from split of stocks, the payment amount per new share is zero. (iii)The said current market price per Share shall be determined based on the simple arithmetic average of the common stock closing price of 1-business-day,3-business-day or 5-business-day before the date of ex-dividend and ex-right, pricing or stock split. (iv)If the exercise price after adjustment is higher than that before adjustment, no adjustment shall be made. (b)After the Options have been granted, the Exercise Price shall be adjusted based on the following formula (to be rounded up to the nearest NT$0.1): adjusted Exercise Price = Exercise Price before adjustment × (1- distributed cash dividend per Share/ the current market price per Share) Note:The said current market price shall be determined based on the simple arithmetic average of the common stock closing price of 1-business-day, 3-business-day or 5-business-day before the date of public announcement of the book closure period for distribution of such cash dividend. (c)After the Options have been granted, for any decrease of the number of the Shares due to the capital reduction from cancellation of Shares (other than resulting from the cancellation of treasury Shares), the Exercise Price shall be adjusted based on the following formula (to be rounded up to the nearest NT$0.1): Capital reduction from cancellation of shares to make up for losses： adjusted Exercise Price = Exercise Price before adjustment × (number of issued and outstanding Shares before capital reduction / number of issued and outstanding Shares after capital reduction) Capital reduction from cancellation of shares to cash reduction： adjusted Exercise Price = (Exercise Price before adjustment-Cash refund per share) × (number of issued and outstanding Shares before capital reduction / number of issued and outstanding Shares after capital reduction) 14.Procedures for exercising options: (a)Except in the period for book closure required under the law, and from 15 business days prior to the date reporting to the competent authority for the public announcement of the book closure period for granting dividends gratis, for distribution of cash dividend, or for rights issue until the record date for such right, the Optionee may request for exercising the option in accordance with the Plan, the Optionee shall fill out an exercise request form and submit such to the Company or the Company's shareholders agent. After the application is completed and reviewed, the Company's shareholders agent shall notify the Optionee to make payment for the shares to the designated. Once the payment is made by the Optionee, the payment shall become irrevocable. Optionee doesn't make the payment in time, the options shall become null and void. (b)After receiving the said request and collecting full payment for the stocks, the Company's shareholders agent shall enter the name of the holder into shareholder register and deliver the newly issued common shares within 5 business days in the book-entry form. (c)The aforesaid common shares may be traded in the emerging stock market from the date of delivery to Optionee. When the company is already exchange-listed or OTC-listed, the aforesaid common shares may be traded on the TWSE or GTSM stock exchange market from the date of delivery to such Optionee. (d)The Company will handle the relevant matters such as the registration of the change in its share capital, etc. (e)The Company shall announce the number of shares delivered for the options exercised by the employees within 15 days after the conclusion of that quarter. 15.Rights and obligations after exercising options:The rights and obligations of the subscribed common shares are the same as the Company's original common shares. The taxes arising from the Shares subscribed by the Optionee pursuant to this Plan and the transactions thereof shall be dealt with in accordance with the relevant tax regulations promulgated by the competent authorities. 16.Record date for any additional share exchange, stock swap, or subscription: NA 17.Possible dilution of equity in case of any additional share exchange, stock swap, or subscription:NA 18.Other important terms and conditions: (a)This Plan shall be approved by a majority of the Directors in a Board Meeting attended by two-thirds or more of Directors and become effective after approval by the competent authority. Amendment made before the issuance shall apply the same rule.If, during the reviewing process, the competent authority requests to make amendment, in order to strive for more efficiency, the Company may authorize the Chairman to amend the Stock Option Issuance and Subscription Plan and submit to the Board of Directors for ratification afterwards. (b)Any other matters not set forth herein shall be dealt with in accordance with the applicable laws, regulations and the Company's Articles of Association. (c)The Plan has been written in Chinese. Any translation of this Plan into a language other than Chinese is for reference only. In the event of conflict between versions, this Chinese version shall govern. 19.Any other matters that need to be specified:None.