Advanced Power Electronics : The Company’s Board of Directors resolved to issue employee restricted stock awards

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Provided by: Advanced Power Electronics Co., Ltd.
SEQ_NO	3	Date of announcement	2022/02/24	Time of announcement	18:22:22
Subject	The Company's Board of Directors resolved to issue employee restricted stock awards
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 Restricted Shares shall be issued at NT$ 0 per share, and grants will be made free of charge. 3.Expected total amount (shares) of issuance: The total number of Restricted Shares to be issued hereunder shall be 1,000,000 shares with a par value of NT$ 10 per share and the total amount shall be NT$ 10,000,000. The Restricted Stock Awards (RSAs) will be granted one or more times over a period of one year from the date of receipt of the notice of effective registration of the competent authority. 4.Vesting conditions: An employee's continuous employment with the Company through the vesting dates; no breach by the employee of any terms of any agreement with the Company to which the employee is subject, including, without limitation, the employee's employment terms and conditions or any other employment-related agreement, any non-competition or confidentiality agreements; no violation by the employee of employee handbook; and, the achievement by the employee of the employee's individual performance goals, and the Company's achievement of operational objectives during the applicable Performance Period. The maximum percentage of granted RSAs that may be vested each year shall be as follows: one-year anniversary of the grant: 30%; two-year anniversary of the grant: 30%; and three-year anniversary of the grant: 40%. 5.Measures to be taken when employees fail to meet the vesting conditions or in the event of inheritance: (1)All unvested RSAs will be forfeited and canceled by the Company without consideration in accordance with these Rules. (2)Methods to Handle the Unvested RSAs: A.Voluntary Separation, separation with a severance, or retirement: Any unvested RSAs will be forfeited on the effective date of separation due to a voluntary separation, separation with a severance, or retirement of such executives. The Company will reclaim the RSAs granted to them and cancel the same at no extra cost to the Company. B.Disability or Death Caused by Work Injury or Death: a.In the event that an employee is physically disabled and cannot continue his/her employment because of work injury, all RSAs held by him/her shall be vested upon his/her termination. b.In the event that an employee dies because of work injury or not, all RSAs held by him/her shall be vested upon his/her death. The heir(s) of such employee may apply to the Company for inheriting part of such RSAs or the interest arising out of the disposition of such RSAs after completing the statutory and necessary procedures pursuant to the applicable laws andregulations and provide relevant certificates with the Company. C.Leave Without Pay: All the rights and obligations in connection with the unvested RSAs will not be affected as a result of executives taking extended leave without pay. However, the actual number of shares that may be vested will not only be calculated according to the vesting conditions but also be prorated based on the number of months of their service during the year prior to the applicable vesting@ day. If such employees are on leave without pay on any vesting day, it shall be deemed that they fail to meet the vesting conditions, and the Company will reclaim the RSAs granted to them and cancel the same at no extra cost to the Company. 6.Other issuance criteria:None. 7.Qualification criteria for employees: A.Full-time employees of the Company are eligible participants of the RSAs. B.The Chairman shall determine the employees who are to be granted the RSAs and the number of Restricted Shares to be granted after taking into consideration factors including but not limited to seniority, position, job performance and overall contribution or special achievements of the employees, and any other management-related factors, and then submit his determination to the Board for approval. However, the Compensation Committee must first give approval for an employee who is also a managerial officer or a director who is also an employee. C.The accumulative number of shares an employee can subscribe for by exercising the employee stock options granted to him/her under Article 56-1, paragraph 1 of the Regulations, in combination with the accumulative number of Restricted Shares granted to such employee, shall not exceed 0.3% of the total issued shares of the Company. And the above in combination with the accumulative number of shares such employee can subscribe for by exercising the stock options granted under Article 56, paragraph 1 of the Regulations,shall not exceed 1% of the total issued shares of the Company. 8.The necessary reason of the current issuance of RSA: To attract and retain talents, to motivate employees, and to foster the best interests of the Company and its shareholders with those of the Company's employees 9.Calculated expense amount: The total expenses are preliminarily estimated at approximately NT$ 105,000 thousand based on the maximum of 1,000,000 common shares to be granted as RSAs, the closing price (the date before BOD meeting) of NT$105 per share on February 23, 2022. The expenses are preliminarily estimated at approximately NT$ 25,520 thousand, NT$48,125 thousand, NT$23,188 thousand and NT$8,167 thousand from 2022 to 2025 respectively, assuming that the RSAs will be issued at the end of August 2022. 10.Dilution of the Company's earnings per share (EPS): Based on the Company's outstanding shares, the potential impact from above mentioned expenses to the Company's EPS is preliminarily estimated at approximately NT$0.31, NT$0.59, NT$0.29, and NT$0.10 from 2022 to 2025 respectively. The potential dilution of the Company's EPS is minimal; therefore, there is no material impact on shareholders' interest. 11.Other matters affecting shareholder's equity:None. 12.Restrictions before employees meet the vesting conditions once the RSA are received or subscribed for: A.Except for inheritance, employees are prohibited from and shall not sell, pledge, transfer, give to another person, create any encumbrance on, or in any other way dispose of any unvested RSAs. B.Rights to attend the Company's shareholder's meeting, submit proposals, or speak and vote at the meeting attributed to ownership of stock with respect to any unvested RSAs will be the same as those of the common shares of the Company but shall be subject to and performed in accordance with the trust agreement. C.Rights to dividends, interest, capital reserve, and share subscription warrants attributed to ownership of stock with respect to any unvested RSAs will be the same as those of the common shares of the Company and shall be subject to and performed in accordance with the trust agreement. D.If any Shares vest on a date that falls during a period in which the Company is prohibited from altering the Company's shareholders' roster, including but not limited to, for reasons pertaining to the Company's issuance of bonus or cash dividends, or conducting a rights offering, convening shareholder's meeting pursuant to paragraph 3 of Article 165 of the Company Act, the release of the restrictions on such RSAs shall be in accordance with the trust agreement and applicable laws and regulations. 13.Other important terms and conditions (including stock trust custody, etc.): A.All Shares under each RSAs shall be deposited in a trust/custody governed by the trust agreement immediately after the granting of the RSAs and execution of Company-required documentation. The employee shall have no right to request and shall not request that the trustee(s) release unvested RSAs held in the trust account for any reason or in any method. B.During the period when the granted RSAs are deposited in a trust/custody account, each employee must enter into an agreement authorizing the Company to, among others, negotiate, execute, modify, extend, rescind, and terminate the trust/custody agreement with the trustee/custodian, and give instructions deliver, use, and dispose of any of the properties under the trust/custody, to on their behalf, with full power and authority. C.Signing of Contracts and Confidentiality a.Those employees who have been granted the RSAs shall sign the "Agreement of Restricted Stock Awards" and complete all the trust/custody management process upon receipt of the notification from the Company. Any employees who do not complete such signing of relevant documents will be considered to forfeit the RSAs. b.Those employees who receive the RSAs and the related rights through these Rules shall comply with these Rules and the "Agreement of Restricted Stock Awards". In the event of any breach thereof, they will be deemed to fail to fulfill the vesting conditions. They shall comply with the confidentiality clauses as well. Except as required by laws and regulations or by any competent authority, they are not allowed to inquire any other about or disclose to any other any information about the number of the RSAs granted to them and any relevant matters, nor may they inform any other of any relevant content of these Rules or any of their rights or interest under these Rules. In the event of any breach thereof, the Company is entitled to reclaim their unvested RSAs and cancel the same at no extra cost to the Company. D.Before these Rules may be implemented, it shall be approved by the majority votes in a meeting of the Board of Directors in which two-thirds or more directors are present and shall become effective after effective registration with the competent authority. If any amendment hereto is necessary due to any change of any laws or regulations or any requirement of the competent authority, Chairman is authorized to make any necessary amendment hereto and submit the revised Rules to the Board of Directors for acknowledgement, before the RSAs may be granted. E.Any other matters not set forth in these Rules shall be dealt with in accordance with the applicable laws and regulations. 14.Any other matters that need to be specified:None.