United Microelectronics : Board Meeting Resolution on issuing Restricted Stock Awards for employees

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Provided by: UNITED MICROELECTRONICS CORP.
SEQ_NO	11	Date of announcement	2022/02/24	Time of announcement	17:07:54
Subject	Board Meeting Resolution on issuing Restricted Stock Awards for employees
Date of events	2022/02/24	To which item it meets	paragraph 11
Statement	1.Date of the board of directors resolution:2022/02/24 2.Expected issue price:The current issue is gratuitous. The price for issuance is NT$0 per share. 3.Expected total amount (shares) of issuance: A maximum of 50,000,000 common shares will be issued, accounting for approximately 0.4% of the outstanding common shares of the Company. The par value per share is NT$10, and the total amount is NT$500,000,000. 4.Vesting conditions: (1)If an employee, after having been granted a restricted stock award, remains on the job on the vesting date, is determined by the Company as having not violated the employment contract, employee code of conduct, trust agreement, corporate governance best practice principles, ethical corporate management best practice principles, work handbook or non-compete and non-disclosure agreement of the Company or any agreement with the Company, and has fulfilled both the personal performance indicators and operational goals set by the Company, proportions of the vesting shares to be granted for such employee on the vesting date each year is as follows: a. On the job for 2 years after granting: 33% b. On the job for 3 years after granting: 33% c. On the job for 4 years after granting: 34% (2)Personal performance indicator(s): A performance rating of A or higher for the most recent fiscal year prior to the end of each vesting period. (3)The operational goals of the Company use the return on equity % (ROE%), earnings per share (EPS) and Morgan Stanley Capital International(MSCI) ESG ratings as performance indicators. Listed below are the performance target and weight for the indicators. Targets are set for each indicator. Indicators that have achieved the target value, the number of vested shares in the year is calculated according to the corresponding weight ratio, otherwise, the corresponding weight ratio is 0%. Performance indicator year refers to the fiscal year of the most recent annual financial statement audited by a certified public accountant before the vesting date. Performance indicators are based on the consolidated financial statements audited and certified by the accountant corresponding to the period required by the indicators. Indicator Weight Target ----------------------- ------- ---------------------------------- Return on Equity 30% Higher than the Company's average (ROE%) of the previous three years (note 1) Earnings Per Share 30% Higher than the Company's average (EPS) of the previous three years (note 1) Morgan Stanley Capital 40% Rating is A or greater International(MSCI) ESG ratings Note 1. Comparing the performance indicator year with the average of the three years preceding that year (exclusive). Note 2. The year in which MSCI's annual ESG ratings are measured is the same measured year of the return on equity and earnings per share performance indicators. 5.Measures to be taken when employees fail to meet the vesting conditions or in the event of inheritance: Where an employee has failed to fulfill the vesting conditions, the shares granted to him/her will be recovered and canceled by the Company without compensation. Any other matters will be subject to the regulations established by the Company to govern the issuance of the shares. 6.Other issuance criteria:None 7.Qualification criteria for employees: (1)To protect the interest of shareholders, the Company will manage the awards program with care. The program shall apply to any full-time employee of the Company or any of its affiliates who is still employed on the date of the granting of restricted stock award shares. Such employee shall reach a certain level of performance and fulfill at least one of the following conditions: a. The employee is strongly related to the future strategic development of the Company; b. The employee is a core technical talent. (2)The number of grantable restricted stock award shares will be based on seniority, job level, position, job performance, overall contribution, special achievement, or other conditions required as the basis for management. The number of shares granted shall be approved by the Chairman and submitted to the Board of Directors for resolution. Any employee who are directors or executives shall be subject to the approval of the Remuneration Committee. (3)Any person who holds 10% and more of the outstanding common shares of the Company is not eligible for a grant. Any member of the Remuneration Committee or any member of the Board of Directors who is not an employee is not eligible for a grant. 8.The necessary reason of the current issuance of RSA: The Company, in order to attract and retain key talents for the achievement of its medium- and long-term objectives, intends to encourage employees to spare no efforts in reaching its operational goals. The aim is to create more benefits for the Company and its shareholders and ensure the alignment of the interest of its employees with that of its shareholders. 9.Calculated expense amount: The Company shall measure the fair value of the shares on the grant date and recognize the related expenses by year during the vesting period. Under the circumstance where all the vesting conditions have been fulfilled, the total estimated calculated expense amount at NT$53.5, the closing price of the Company's common stock on February 15, 2022, is NT$2,675,000 thousand. The estimated calculated expense amounts for 2022 to 2026 respectively are NT$81,759 thousand, NT$963,000 thousand, NT$925,527 thousand, NT$496,643 thousand, and NT$208,071 thousand. 10.Dilution of the Company's earnings per share (EPS): Calculated on the basis of the current number of the Company's outstanding common shares and restricted stock awards not exceeding the amount issued this time, the dilution of Company's EPS is estimated in the amount of NT$0.01, NT$0.06, NT$0.06, NT$0.04, and NT$0.03 for 2022 to 2026, respectively. 11.Other matters affecting shareholder's equity:No significant impact 12.Restrictions before employees meet the vesting conditions once the RSA are received or subscribed for: Before any employee who has been granted restricted stock award shares fulfills the vesting conditions, except for the case of inheritance, the restricted stock award shares may not be sold, pledged, transferred, gifted to others, created any encumbrance, or otherwise disposed of. 13.Other important terms and conditions (including stock trust custody, etc.): The restricted stock award shares issued by the Company shall be placed under custodial trust. 14.Any other matters that need to be specified: (1)Where the conditions set for this issue of restricted stock award shares require revision or amendment due to instructions from the competent authority, amendment of the applicable laws and regulationsor conditions in the financial market, it is proposed that a Shareholders' Meeting will authorizes the Board of Directors or any person authorized by the Board to deal with the matter at full discretion. (2)This issue of restricted stock award shares, its related limitations and the important matters agreed to, or any matter not provided for, shall be subject to the applicable laws and regulations and the regulations established by the Company to govern the issuance.