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(1) | To adopt the Audited Financial Statements of the Company for the financial year ended December 28, 2008, together with the Reports of the Directors and the Auditors. | |
(2) | To appoint Mr. Rohit Sipahimalani as a Director of the Company pursuant to Article 99 of the Articles of Association of the Company. | |
(3) | To re-elect the following Directors, each of whom will retire pursuant to Article 94 of the Articles of Association of the Company and who, being eligible, offer themselves for re-election: |
(a) | Mr. Teng Cheong Kwee; and | ||
(b) | Mr. Tokumasa Yasui. |
(4) | To re-appoint the following Directors each of whom will retire under Section 153(6) of the Companies Act, Chapter 50 of Singapore (the “Companies Act”), to hold office from the date of this Annual General Meeting until the next annual general meeting of the Company: |
(a) | Mr. Charles R. Wofford; and | ||
(b) | Mr. R. Douglas Norby. |
(5) | To re-appoint PricewaterhouseCoopers as Auditors to hold office until the conclusion of the next annual general meeting of the Company at a remuneration to be determined by the Board of Directors upon the recommendation of the Audit Committee of the Board of Directors. | |
(6) | To approve Directors’ fees totalling approximately US$473,000 (approximately S$732,000 based on the exchange rate as of February 27, 2009) for the financial year ending December 27, 2009. |
(7) | To consider and, if thought fit, to pass, with or without modifications, the following resolutions which will be proposed as ordinary resolutions: | |
Ordinary Resolutions |
(a) | Authority to Allot and Issue Shares and to Create and Issue Instruments and to Allot and Issue Shares in connection therewith pursuant to Section 161 of the Companies Act. | ||
That pursuant to Section 161 of the Companies Act, the Directors be and are hereby authorized to: |
(I) | (i) | allot and issue shares in the capital of the Company whether by way of rights, bonus or otherwise; and/or |
(ii) | make or grant offers, agreements or options (collectively, “Instruments”) that might or would require shares to be issued, including but not limited to the creation and issue of (as well as adjustments to) warrants, debentures or other instruments convertible into shares, |
at any time and upon such terms and conditions and for such purposes and to such persons as the Directors may in their absolute discretion deem fit; and, | |||
(II) | (notwithstanding the authority conferred by this resolution may have ceased to be in force) issue shares pursuant to any Instrument made or granted by the Directors while this Resolution was in force, |
provided that: |
(1) | the aggregate number of shares to be issued pursuant to this resolution (including shares to be |
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issued pursuant to Instruments made or granted under this resolution) does not exceed 50% of the total number of issued shares (excluding treasury shares) in the capital of the Company (as calculated in accordance with subparagraph 2 below), of which the aggregate number of shares to be issued other than on apro ratabasis to shareholders of the Company (including shares to be issued pursuant to Instruments made or granted under this resolution) does not exceed 6% of the total number of issued shares (excluding treasury shares) in the capital of the Company (as calculated in accordance with subparagraph 2 below); |
(2) | for the purpose of determining the aggregate number of shares that may be issued under subparagraph 1 above, the total number of issued shares (excluding treasury shares) shall be based on the total number of issued shares (excluding treasury shares) in the capital of the Company, at the time this Resolution is passed, after adjusting for: |
a. | new shares arising from the exercise of any share options which are outstanding or subsisting at the time this resolution is passed; and | ||
b. | any subsequent bonus issue, consolidation or subdivision of shares; |
(3) | (unless revoked or varied by the Company in a general meeting) the authority conferred by this resolution shall continue in force until the conclusion of the next annual general meeting of the Company or the date by which the next annual general meeting of the Company is required by law to be held, whichever is the earlier. |
(b) | Authority to Allot and Issue Shares pursuant to the STATS ChipPAC Ltd. Substitute Share Purchase and Option Plan and the STATS ChipPAC Ltd. Substitute Equity Incentive Plan (collectively, the “Substitute Plans”). | ||
That the Directors be and are hereby authorized to allot and issue from time to time such number of shares of the Company as may be required to be issued pursuant to the exercise of the options under the Substitute Plans. | |||
(c) | Authority to Allot and Issue Shares pursuant to the STATS ChipPAC Ltd. Share Option Plan, as amended (the “Share Option Plan”). | ||
That the Directors be and are hereby authorized to allot and issue from time to time such number of shares of the Company as may be required to be issued pursuant to the exercise of the options under the Share Option Plan. | |||
(d) | The Proposed STATS ChipPAC Ltd. Performance Share Plan 2009. | ||
THAT: |
(i) | a new performance share plan to be known as the “STATS ChipPAC Ltd. Performance Share Plan 2009”, as substantially set forth in Appendix 1 to the Proxy Statement dated April 9, 2009 in respect of the Annual General Meeting (the “PSP 2009”), the rules of which, for the purpose of identification, have been subscribed to by the Chairman of the Annual General Meeting, having been produced at the Annual General Meeting, under which performance shares (“Performance Shares”), which represent unfunded and unsecured rights to receive ordinary shares in the capital of the Company, will be granted, free of payment, to selected employees of the Company and its subsidiaries (“Group”), including the Chief Executive Officer of the Company and directors of the Group who perform an executive function, details of which are set out in the Proxy Statement dated April 9, 2009 in respect of the Annual General Meeting, be and is hereby approved; | ||
(i) | the Directors of the Company be and are hereby authorized: |
(ii) | (aa) | to establish the PSP 2009; |
�� | (bb) | to delegate to a committee of Directors the administration of the PSP 2009 in accordance with the provisions of the PSP 2009; and | |
(cc) | to modify and/or alter the PSP 2009 from time to time, provided that such modification and/or alteration is effected in accordance with the provisions of the PSP 2009, and to do all such acts and to enter into all such transactions and arrangements as may be necessary or expedient in order to give full effect to the PSP 2009; and |
(iii) | the Directors of the Company be and are hereby authorized to grant Performance Shares in accordance with the provisions of the PSP 2009 and to allot and issue from time to time such number of fully paid-up ordinary shares in the capital of the Company as may be required to be allotted and issued pursuant to the terms of the PSP 2009, provided that the aggregate number of ordinary shares in the capital of the Company allotted and issued under the PSP 2009 shall not exceed the limits specified in the rules of the PSP 2009. |
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(e) | The Proposed STATS ChipPAC Ltd. Equity Grant Plan for Non-Executive Directors | ||
THAT: |
(i) | a new equity grant plan to be known as the “STATS ChipPAC Ltd. Equity Grant Plan for Non-Executive Directors”, as substantially set forth in Appendix 2 to the Proxy Statement dated April 9, 2009 in respect of the Annual General Meeting (the “NED Plan”), the rules of which, for the purpose of identification, have been subscribed to by the Chairman of the Annual General Meeting, having been produced at the Annual General Meeting, under which offers will be made to selected directors of the Company who perform a non-executive function (“Non-Executive Directors”) to participate in the NED Plan, and pursuant thereto, fully paid-up ordinary shares in the capital of the Company may be allotted and issued, free of payment, to such participants, details of which are set out in the Proxy Statement dated April 9, 2009 in respect of the Annual General Meeting, be and is hereby approved; | ||
(ii) | the Directors of the Company be and are hereby authorized: |
(aa) | to establish the NED Plan; | ||
(bb) | to delegate to a committee of Directors the administration of the NED Plan in accordance with the provisions of the NED Plan; and | ||
(cc) | to modify and/or alter the NED Plan from time to time, provided that such modification and/or alteration is effected in accordance with the provisions of the NED Plan, and to do all such acts and to enter into all such transactions and arrangements as may be necessary or expedient in order to give full effect to the NED Plan; and |
(iii) | the Directors of the Company be and are hereby authorized to make offers to selected Non-Executive Directors to participate in the NED Plan in accordance with the NED Plan and to allot and issue from time to time such number of fully paid-up ordinary shares in the capital of the Company as may be required to be allotted and issued pursuant to the terms of the NED Plan, provided that the aggregate number of ordinary shares in the capital of the Company allotted and issued under the NED Plan shall not exceed the limits specified in the rules of the NED Plan. |
(f) | The Proposed Renewal of the Share Purchase Mandate | ||
That: |
(i) | for the purposes of Sections 76C and 76E of the Companies Act, the exercise by the Directors of the Company of all the powers of the Company to purchase or otherwise acquire issued ordinary shares each fully paid in the capital of the Company (“Shares”) not exceeding in aggregate the Maximum Percentage (as hereafter defined), at such price or prices as may be determined by the Directors from time to time up to the Maximum Price (as hereafter defined), whether by way of: |
(aa) | market purchase(s) on the Singapore Exchange Securities Trading Limited (“SGX-ST”) transacted through the SGX-ST’s trading system; and/or | ||
(bb) | off-market purchase(s) (if effected otherwise than on the SGX-ST) in accordance with any equal access scheme(s) as may be determined or formulated by the Directors as they consider fit, which scheme(s) shall satisfy all the conditions prescribed by the Companies Act, |
and otherwise in accordance with all other laws and regulations as may for the time being be applicable, be and is hereby authorized and approved generally and unconditionally (the “Share Purchase Mandate”); | |||
(ii) | unless varied or revoked by the Company in general meeting, the authority conferred on the Directors of the Company pursuant to the Share Purchase Mandate may be exercised by the Directors at any time, and from time to time during the period commencing from the date of the passing of this Resolution and expiring on the earlier of: |
(aa) | the date on which the next annual general meeting of the Company is held; and | ||
(bb) | the date by which the next annual general meeting of the Company is required by law to be held; |
(iii) | in this Resolution: | ||
“Market Day” means a day on which the SGX-ST is open for trading in securities; | |||
“Maximum Percentage” means that number of issued Shares representing 2.5% of the total number of issued Shares of the Company as of the date of the passing of this Resolution (excluding any Shares which are held as treasury shares as of that date); and |
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“Maximum Price” in relation to a Share to be purchased or acquired, means the purchase price (excluding related brokerage, commission, applicable goods and services tax, stamp duties, clearance fees and other related expenses) which shall not exceed 105% of the highest independent bid or the last independent transaction price, whichever is the higher, quoted on the SGX-ST at the time the purchase is effected; and | |||
(iv) | the Directors of the Company and/or any of them be and are hereby authorized to complete and do all such acts and things (including executing such documents as may be required) as they and/or he may consider expedient or necessary to give effect to the transactions contemplated and/or authorized by this Resolution. |
(8) | To transact any other business as may be properly transacted at any annual general meeting. |
Notes: | ||
(1) | A shareholder is a person whose name appears on the Depository Register of The Central Depository (Pte) Limited in Singapore or a person registered in the Company’s Register of Shareholders (i.e. Members). | |
(2) | A shareholder entitled to attend and vote at the Annual General Meeting is entitled to appoint a proxy to attend and vote on his behalf. A proxy need not be a shareholder of the Company. Shareholders may appoint any member of the Board or any other person as their proxy. The instrument appointing a proxy must be deposited at the registered office of the Company at 10 Ang Mo Kio Street 65, Techpoint #05-17/20, Singapore 569059 not less than 48 hours before the time appointed for holding the Annual General Meeting or at any adjournment thereof. A proxy may be revoked at any time, not less than 48 hours before the time set for the Annual General Meeting by the shareholder submitting a subsequently dated instrument appointing a proxy or at the Annual General Meeting prior to the vote of the resolution by such shareholder attending the Annual General Meeting and voting in person. | |
(3) | The Company is subject to applicable U.S. federal securities laws and is not subject to the continuing listing rules of the SGX-ST. | |
(4) | Since the beginning of financial year 2005, the Company employed financial year reporting periods that end on the Sunday nearest and prior to December 31. The Company’s financial year 2008 ended on December 28, 2008. | |
(5) | The Company may use the internal sources of funds of the Company and its subsidiaries (the “Group”) or external borrowings or a combination of both to finance the purchase or acquisition of its Shares. The amount of financing required for the Company to purchase or acquire its Shares, and the impact on the Company’s financial position, cannot be ascertained as of the date of this Notice as these will depend on the number of Shares purchased or acquired and the price at which such Shares were purchased or acquired and whether the Shares purchased or acquired are held in treasury or cancelled. | |
Based on the existing issued Shares of the Company of 2,202,218,293 Shares as of February 27, 2009, the purchase by the Company of 2.5% of its issued Shares will result in the purchase or acquisition of 55,055,457 Shares. | ||
Assuming that the Company purchases or acquires the 55,055,457 Shares at the Maximum Price of S$0.373 (approximately US$0.241 based on the exchange rate as of February 27, 2009) for one Share (being the price (excluding related brokerage, commission, applicable goods and services tax, stamp duties, clearance fees and other related expenses) equal to 105% of the highest independent bid or the last independent transaction price, whichever is the higher, quoted on the SGX-ST for the five consecutive Market Days on which the Shares were traded on the SGX-ST immediately preceding February 27, 2009), the maximum amount of funds required for the purchase or acquisition of the 55,055,457 Shares is S$20,536,000 (approximately US$13,275,000 based on the exchange rate as of February 27, 2009). | ||
The financial effects of the purchase or acquisition of such Shares by the Company pursuant to the proposed Share Purchase Mandate on the audited consolidated financial statements of the Company for the financial year ended December 28, 2008 based on these assumptions are set out in Proposal 7(f) of the Proxy Statement. |
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1. | Adoption of the Audited Financial Statements of STATS ChipPAC for the financial year ended December 28, 2008, together with the Reports of the Directors and the Auditors. | |
2. | Appointment of Director pursuant to Article 99 of STATS ChipPAC’s Articles of Association. | |
3. | Re-election of Directors retiring by rotation pursuant to Article 94 of STATS ChipPAC’s Articles of Association. | |
4. | Re-appointment of Directors pursuant to Section 153(6) of the Companies Act. | |
5. | Re-appointment of PricewaterhouseCoopers (“PwC”) as Auditors and authorization to the Board, upon the recommendation of the Audit Committee of the Board, to fix their remuneration. | |
6. | Approval of Directors’ fees for the financial year ending December 27, 2009. | |
7. | Authority to the Board of Directors to allot and issue shares and to create and issue instruments, to adopt the new share plans and to renew the share purchase mandate. |
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(i) | the STATS ChipPAC Ltd. Share Option Plan, as amended (the “Share Option Plan”): no more than 198 million shares (including the 80 million shares subject to the STATS ChipPAC Ltd. Substitute Share Purchase and Option Plan and the STATS ChipPAC Ltd. Substitute Equity Incentive Plan); | |
(ii) | the proposed STATS ChipPAC Ltd. Performance Share Plan 2009 (the “PSP 2009”): no more than 5.02% of the total number of issued shares as at the adoption date of the PSP 2009. Assuming 2,202,218,293 (being the total number of shares issued as at February 27, 2009) shares were issued (including shares issuable |
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upon conversion of all outstanding convertible bonds as of the adoption date, any shares issued with regard to any future acquisition and any equity grants awarded prior to the adoption date) as at the adoption date, approximately no more than 110,551,358 shares will be delivered under the PSP 2009; and | ||
(iii) | the proposed STATS ChipPAC Ltd. Equity Grant Plan for Non-Executive Directors (the “NED Plan”): no more than 0.45% of the total number of issued shares as at the adoption date of NED Plan. Assuming 2,202,218,293 (being the total number of shares issued as at February 27, 2009) shares were issued (including shares issuable upon conversion of all outstanding convertible bonds as of the adoption date, any shares issued with regard to any future acquisition and any equity grants awarded prior to the adoption date) as at the adoption date, approximately no more than 9,909,982 shares will be delivered under the NED Plan. |
(i) | under Proposal 7(b), allot and issue shares in the capital of STATS ChipPAC pursuant to the exercise of the options under the Substitute Option Plan and the Substitute EIP; and | |
(ii) | under Proposal 7(c), allot and issue shares in the capital of STATS ChipPAC pursuant to the exercise of the options granted under the Share Option Plan; |
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(a) | the participant; | |
(b) | the date on which the Award is granted (“Award Date”); | |
(c) | the number of Performance Shares which are the subject of the Award; and | |
(d) | any other condition which the Committee may determine in relation to that Award. |
(a) | the termination of a participant’s employment with the Group for Cause (as defined in the PSP 2009); | |
(b) | the termination of a participant’s employment with the Group due to such participant’s death or disability, or the termination of his employment by the Group without Cause; and | |
(c) | the termination of a participant’s employment with the Group for any reason other than as set out in paragraphs (a) and (b) above. |
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(i) | when added to the total number of new Shares issued and issuable pursuant to Awards granted under the PSP 2009, shall not exceed 5.02% of the total number of the outstanding Ordinary Shares; and | |
(ii) | when added to the total number of new Shares issued and issuable pursuant to Awards granted under the PSP 2009 and any other equity grant plans adopted by the Company on or after the date of adoption of the PSP 2009, shall not exceed 15% of the total number of issued shares from time to time (excluding treasury shares). |
(a) | the names of the members of the Committee administering the PSP 2009; | |
(b) | in respect of the following participants of the PSP 2009: |
(i) | Directors of the Company; and | ||
(ii) | participants (other than those in paragraph (i) above) who have received shares pursuant to the vesting of Awards granted under the PSP 2009 which, in aggregate, represent 5% or more of the aggregate of the total number of new shares available under the PSP 2009; and |
the following information: |
(aa) | the name of the participant; and | ||
(bb) | the number of new shares issued to such participant during the financial year under review; and |
(c) | in relation to the PSP 2009, the following particulars: |
(i) | the aggregate number of Performance Shares comprised in Awards granted under the PSP 2009 since the commencement of the PSP 2009 to the end of the financial year under review; | ||
(ii) | the aggregate number of Performance Shares comprised in Awards which have vested under the PSP 2009 since the commencement of the PSP 2009 to the end of the financial year under review; and | ||
(iii) | the aggregate number of Performance Shares comprised in Awards granted under the PSP 2009 which have not vested as at the end of the financial year under review, |
or as otherwise required under the Listing Manual from time to time. |
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(i) | employees, directors and Consultants1 of the Company, a Parent2 or a Subsidiary3 or an Affiliated Company,4 are eligible to participate in the Terminated RSP; | |
(ii) | only RSUs could have been granted under the Terminated RSP. An RSU represents an unfunded, unsecured promise of the company to issue or transfer shares of the company in the future to grantees. RSUs were granted with no exercise or purchase price. The concept of a discount to the exercise price is therefore not applicable in the context of the Terminated RSU. Shares offered under the Terminated RSP may be unissued shares or existing shares which will be issued or transferred to the grantee upon satisfaction of the applicable terms and conditions as set forth in the RSU agreement. The Board or the committee, as applicable, may provide for time-based vesting or vesting upon satisfaction of performance goals and/or other conditions. RSUs may be paid in cash or shares, as determined in the sole discretion of the Board or the committee; | |
(iii) | subject to certain permitted adjustments under the Terminated RSP, the maximum number of shares that may be issued or transferred under the Terminated RSP cannot exceed 50 million shares; and | |
(iv) | one-third of the RSUs vest after each of the first, second and third anniversaries of the date of grant. |
Number of shares | ||||||||||
Number of shares | allotted and issued upon | |||||||||
Name | Date of grant of RSUs | subject to RSUs | vesting of RSUs | |||||||
Directors | ||||||||||
Tan Lay Koon | February 16, 2007 | 322,000 | 107,333 | |||||||
Charles Wofford | February 16, 2007 | 27,600 | 9,200 | |||||||
Peter Seah | February 16, 2007 | 20,700 | 6,900 | |||||||
R. Douglas Norby | February 16, 2007 | 20,700 | 6,900 | |||||||
Controlling shareholders and their associates | ||||||||||
NIL | NIL | NIL | NIL |
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(i) | employees, directors and Consultants1 of the Company, a Parent2 or a Subsidiary3 or an Affiliated Company,4 were eligible to participate in the Terminated PSP; | |
(ii) | only performance shares could have been granted under the Terminated PSP. A performance share represents an award of shares payable upon satisfaction of specific performance criteria. If granted, awards of performance shares would have been made with no exercise or purchase price. The concept of a discount to the exercise price is therefore not applicable in the context of the Terminated PSP. Shares offered under the Terminated PSP may be unissued shares or existing shares which will be issued or transferred to the grantee upon satisfaction of the applicable terms and conditions as set forth in a performance share agreement; and | |
(iii) | subject to certain permitted adjustments under the Terminated PSP, the maximum number of shares that may be issued or transferred under the Terminated PSP cannot exceed 15 million shares. |
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(a) | align the interests of the participants with the interests of the shareholders of the Company; | |
(b) | motivate each participant to maintain a high level of contribution to the Group; and | |
(c) | give recognition to the contributions made or to be made by directors of the Company who perform a non-executive function (“Non-Executive Directors” and each, a “Non-Executive Director”) to the Group. |
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(i) | when added to the total number of new Shares issued and issuable under the NED Plan, shall not exceed 0.45% of the total number of the outstanding Ordinary Shares; and | |
(ii) | when added to the total number of new Shares issued and issuable (i) under the NED Plan, and (ii) pursuant to awards granted under the PSP 2009, shall not exceed 15% of the total number of issued Shares from time to time (excluding treasury shares). |
(a) | the names of the members of the Committee administering the NED Plan; | |
(b) | in respect of all the participants of the NED Plan, the following information: |
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(aa) | the name of the participant; and | ||
(bb) | the number of new Shares issued to such participant during the financial year under review; and |
(c) | in relation to the NED Plan, the aggregate number of Ordinary Shares that have been allotted and issued under the NED Plan since the commencement of the NED Plan to the end of the financial year under review, |
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1. | Background | |
It is a requirement that a Singapore incorporated company such as STATS ChipPAC which wishes to purchase or acquire its own shares should obtain approval of its shareholders to do so at a general meeting of its shareholders. Accordingly, approval was sought from shareholders at the last Annual General Meeting held on April 23, 2008 for a general and unconditional mandate (the “Share Purchase Mandate”) to be given for the purchase or acquisition by STATS ChipPAC of its issued shares. | ||
As approved by shareholders at the last annual general meeting held on April 23, 2008, the authority conferred by the Share Purchase Mandate will continue in force until the next annual general meeting of STATS ChipPAC, which is scheduled to be held on April 27, 2009 (whereupon it will lapse, unless renewed at such meeting). As of December 28, 2008, the Company has not repurchased any shares. | ||
2. | Rationale for the Renewal of the Share Purchase Mandate | |
The rationale for STATS ChipPAC to undertake a purchase or acquisition of its is as follows: |
(a) | In managing our business, management strives to increase shareholders’ value. In addition to growth and expansion of the business, share purchases may be considered as one of the ways through which shareholders’ value may be enhanced. | ||
(b) | The Share Purchase Mandate will provide us with greater flexibility in managing our capital and maximising returns to our shareholders. To the extent that STATS ChipPAC has capital and surplus funds that are in excess of its financial needs, taking into account its growth and expansion plans, the Share Purchase Mandate will facilitate the return of excess cash and surplus funds to shareholders in an expedient, effective and cost-efficient manner. | ||
(c) | A share repurchase program will also allow management to effectively manage and minimise the dilutive impact (if any) associated with employee or share compensation schemes. |
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(d) | Share repurchase programs help buffer short-term share price volatility. | ||
(e) | The Share Purchase Mandate will provide STATS ChipPAC the flexibility to undertake share repurchases at any time, subject to market conditions and applicable laws, during the period when the Share Purchase Mandate is in force. |
The purchase or acquisition of shares will only be undertaken if it can benefit STATS ChipPAC and shareholders. Shareholders should note that purchases or acquisitions of shares pursuant to the Share Purchase Mandate may not be carried out to the full limit as authorized. No purchase or acquisition of shares will be made in circumstances which would have or may have a material adverse effect on the liquidity and capital adequacy position of STATS ChipPAC and its subsidiaries (the “Group”) as a whole. | ||
3. | Authority and Limits of the Share Purchase Mandate.The authority and limitations placed on the purchases or acquisitions of shares by STATS ChipPAC under the Share Purchase Mandate, if renewed at the Annual General Meeting, are summarised below. STATS ChipPAC intends to effect repurchases of shares in compliance with all applicable laws. |
3.1 | Maximum number of shares | ||
Only shares which are issued and fully paid-up may be purchased or acquired by STATS ChipPAC. The total number of shares which may be purchased or acquired by STATS ChipPAC pursuant to the Share Purchase Mandate is limited to that number of shares representing not more than 2.5% of the total number of issued ordinary shares of STATS ChipPAC as of the date of the forthcoming Annual General Meeting at which the Share Purchase Mandate is renewed. Any shares which are held as treasury shares will be disregarded for the purposes of computing the 2.5% limit. | |||
3.2 | Duration of authority | ||
Purchases or acquisitions of shares may be made, at any time and from time to time, on and from the date of the Annual General Meeting, at which the Share Purchase Mandate is renewed, up to: |
(a) | the date on which the next annual general meeting of STATS ChipPAC is held or required by law to be held; or | ||
(b) | the date on which the authority conferred by the Share Purchase Mandate is revoked or varied, |
whichever is the earlier. | |||
3.3 | Manner of purchases or acquisitions of shares | ||
Purchases or acquisitions of shares may be made by way of: |
(a) | on-market purchases (“Market Purchases”), in respect of shares transacted through the SGX-ST’s trading system or on any other securities exchange on which the shares may for the time being be listed and quoted, through one or more duly licensed dealers appointed by STATS ChipPAC for the purpose; and/or | ||
(b) | off-market purchases (“Off-Market Purchases”), otherwise than on a securities exchange, in accordance with an equal access scheme or schemes. |
The Company may or may not effect any Off-Market Purchases. If it does so, the Directors may impose such terms and conditions which are not inconsistent with the Share Purchase Mandate, applicable U.S. federal securities law and the Companies Act as they consider fit in the interests of STATS ChipPAC in connection with or in relation to any equal access scheme or schemes. An equal access scheme must, however, satisfy all the following conditions: |
(i) | offers for the purchase or acquisition of shares shall be made to every person who holds shares to purchase or acquire the same percentage of their shares; | ||
(ii) | all of those persons shall be given a reasonable opportunity to accept the offers made; and | ||
(iii) | the terms of all the offers are the same, except that there shall be disregarded (1) differences in consideration attributable to the fact that offers may relate to shares with different accrued dividend entitlements and (2) differences in the offers introduced solely to ensure that each person is left with a whole number of shares. |
If STATS ChipPAC wishes to make an Off-Market Purchase in accordance with an equal access scheme, it will comply with all applicable U.S federal securities laws and the Companies Act and will issue an offer document containing at least the following information: |
(i) | the terms and conditions of the offer; | ||
(ii) | the period and procedures for acceptances; and |
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(iii) | the information required under Rules 883(2), (3), (4) and (5) of the SGX-ST Listing Manual and required by applicable U.S federal securities laws regulating tender offers. |
3.4 | Purchase Price | ||
The purchase price (excluding related brokerage, commission, applicable goods and services tax, stamp duties, clearance fees and other related expenses) to be paid for a share will be determined by the Directors. The purchase price to be paid for the shares as determined by the Directors pursuant to the Share Purchase Mandate (both Market Purchases and Off-Market Purchases) must not exceed 105% of the highest independent bid or the last independent transaction price, whichever is the higher, quoted on the SGX-ST at the time the purchase is effected (excluding related brokerage, commission, applicable goods and services tax, stamp duties, clearance fees and other related expenses) (the “Maximum Price”). |
4. | Status of Purchased Shares. A share purchased or acquired by STATS ChipPAC is deemed cancelled immediately on purchase or acquisition (and all rights and privileges attached to the share will expire on such cancellation) unless such share is held by STATS ChipPAC as a treasury share. Accordingly, the total number of issued shares will be diminished by the number of shares purchased or acquired by STATS ChipPAC and which are not held as treasury shares. | |
5. | Treasury Shares. Under the Companies Act, shares purchased or acquired by STATS ChipPAC may be held or dealt with as treasury shares. Some of the provisions on treasury shares under the Companies Act are summarised below: |
5.1 | Maximum Holdings | ||
The number of shares held as treasury shares cannot at any time exceed 10% of the total number of issued shares. | |||
5.2 | Voting and Other Rights | ||
STATS ChipPAC cannot exercise any right in respect of treasury shares. In particular, STATS ChipPAC cannot exercise any right to attend or vote at meetings and for the purposes of the Companies Act, STATS ChipPAC shall be treated as having no right to vote and the treasury shares shall be treated as having no voting rights. | |||
In addition, no dividend may be paid, and no other distribution of STATS ChipPAC’s assets may be made, to STATS ChipPAC in respect of treasury shares. However, the allotment of shares as fully paid bonus shares in respect of treasury shares is allowed. Also, a subdivision or consolidation of any treasury share into treasury shares of a smaller amount is allowed so long as the total value of the treasury shares after the subdivision or consolidation is the same as before. | |||
5.3 | Disposal and Cancellation | ||
Where shares are held as treasury shares, STATS ChipPAC may at any time: |
(a) | sell the treasury shares for cash; | ||
(b) | transfer the treasury shares for the purposes of or pursuant to an employees’ share scheme; | ||
(c) | transfer the treasury shares as consideration for the acquisition of shares in or assets of another company or assets of a person; | ||
(d) | cancel the treasury shares; or | ||
(e) | sell, transfer or otherwise use the treasury shares for such other purposes as may be prescribed by the Minister for Finance. |
6. | Source of Funds. STATS ChipPAC may purchase or acquire its own shares out of capital, as well as from its profits. | |
The Company will use internal resources or external borrowings or a combination of both to fund purchases or acquisitions of shares pursuant to the Share Purchase Mandate. | ||
7. | Financial Effects.The financial effects on the Group arising from purchases or acquisitions of shares which may be made pursuant to the Share Purchase Mandate will depend on,inter alia, whether such shares are purchased or acquired out of profits and/or capital of the Company, the number of such shares purchased or acquired, the price paid for such shares and whether such shares purchased or acquired are held as treasury |
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shares or cancelled. The financial effects on the Group, based on the audited consolidated financial statements of STATS ChipPAC for the financial year ended December 28, 2008, are based on the assumptions set out below. |
7.1 | Purchase or Acquisition out of Capital or Profits | ||
Under the Companies Act, purchases or acquisitions of shares by STATS ChipPAC may be made out of STATS ChipPAC’s capital or profits so long as STATS ChipPAC is solvent. | |||
Where the consideration paid by STATS ChipPAC for the purchase or acquisition of shares is made out of profits, such consideration (excluding related brokerage, goods and services tax, stamp duties and clearance fees) will correspondingly reduce the amount available for the distribution of cash dividends by STATS ChipPAC. Where the consideration paid by STATS ChipPAC for the purchase or acquisition of shares is made out of capital, the amount available for the distribution of cash dividends by STATS ChipPAC will not be reduced. | |||
7.2 | Information as of February 27, 2009 (the “Latest Practicable Date”) | ||
As at the Latest Practicable Date, the issued capital of STATS ChipPAC comprised 2,202,218,293 shares. In addition, as at the Latest Practicable Date, there were outstanding and remaining unexercised share options to subscribe for 13,749,307 shares. Except in respect of shares which are issuable pursuant to the Option Plans, no shares are reserved for issue by STATS ChipPAC as at the Latest Practicable Date. | |||
Purely for illustrative purposes, on the basis of 2,202,218,293 shares in issue as at the Latest Practicable Date and assuming no further shares are issued, the purchase by STATS ChipPAC of 2.5% of its issued shares will result in the purchase or acquisition of 55,055,457 shares. | |||
Assuming that STATS ChipPAC purchases or acquires the 55,055,457 shares at the Maximum Price of S$0.373 (approximately US$0.241 based on the exchange rate as of February 27, 2009) for one share (being the price (excluding related brokerage, commission, applicable goods and services tax, stamp duties, clearance fees and other related expenses) equal to 105% of the highest independent bid or the last independent transaction price, whichever is the higher, quoted on the SGX-ST for the five consecutive market days on which the shares were traded on the SGX-ST immediately preceding the Latest Practicable Date), the maximum amount of funds required for the purchase or acquisition of the 55,055,457 shares is S$20,536,000 (approximately US$13,275,000 based on the exchange rate as of February 27, 2009). As of the Latest Practicable Date, the exchange rate was US$1.00 to S$1.5469. | |||
Although the Share Purchase Mandate would authorize the Company to purchase or acquire up to 2.5% of its issued shares as at the date on which the Share Purchase Mandate is renewed at the Annual General Meeting, the Company may not necessarily purchase or acquire or be able to purchase or acquire the entire 2.5% of its issued shares. As set out above, the Company may purchase or acquire its own shares out of capital, as well as from its profits so long as the Company is solvent. With effect from January 30, 2006, all amounts standing to the credit of the Company’s share premium account and any amount standing to the credit of the Company’s capital redemption reserve has become part of the Company’s share capital and can be used for the purchase of its own shares. | |||
As STATS ChipPAC does not have accumulated profits as at December 28, 2008, we have not provided the financial effects on STATS ChipPAC arising from purchases or acquisitions of shares made out of STATS ChipPAC’s profits. | |||
7.3 | Illustrative Financial Effects | ||
The financial effects on the Group arising from purchases or acquisitions of shares which may be made pursuant to the Share Purchase Mandate will depend on,inter alia,the aggregate number of shares purchased or acquired, whether the purchase or acquisition is made out of capital or profits, and the consideration paid at the relevant time and whether the shares purchased or acquired are cancelled or held as treasury shares. The assumptions include the following: |
(a) | the Share Purchase Mandate had been effective since the beginning of the financial year ended December 28, 2008 and STATS ChipPAC had purchased 55,055,457 shares as at that date. | ||
(b) | no issuance of shares from the exercise of share options after the Latest Practicable Date; and | ||
(c) | the purchase consideration of S$20,536,000 (approximately US$13,275,000 based on the exchange rate as of February 27, 2008) had been funded from external borrowings at an effective interest rate of 3.57% per annum. |
For illustrative purposes only and on the basis of the assumptions set out above, the financial effects of the: |
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(i) | acquisition of 55,055,457 shares by STATS ChipPAC pursuant to the Share Purchase Mandate by way of purchases made entirely out of capital and held as treasury shares; and | ||
(ii) | acquisition of 55,055,457 shares by STATS ChipPAC pursuant to the Share Purchase Mandate by way of purchases made entirely out of capital and cancelled, |
based on the audited consolidated financial statements of STATS ChipPAC for the financial year ended December 28, 2008 would be as set out on the following pages: |
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(a) | Purchases made entirely out of capital and held as treasury shares |
Before | After | |||||||
Share Purchase | Share Purchase | |||||||
(In US$’000, except per share data and ratios) | ||||||||
Share Capital | 2,035,235 | 2,035,235 | ||||||
Accumulated Other Comprehensive Loss | (12,308 | ) | (12,308 | ) | ||||
Accumulated Deficit | (474,270 | ) | (474,744 | ) | ||||
1,548,657 | 1,548,183 | |||||||
Treasury Shares | — | (13,275 | ) | |||||
Total Shareholders’ Equity | 1,548,657 | 1,534,908 | ||||||
Net Tangible Assets | 1,011,805 | 998,056 | ||||||
Current Assets | 571,308 | 571,308 | ||||||
Current Liabilities | 378,720 | 392,469 | ||||||
Total Borrowings | 473,453 | 486,728 | ||||||
Cash and Cash Equivalents | 295,916 | 295,916 | ||||||
Net Debt | 177,537 | 190,812 | ||||||
Number of Shares (’000) | 2,202,218 | 2,202,218 | * | |||||
Financial Ratios | ||||||||
Net Tangible Assets per Share (US$) | 0.46 | 0.46 | ||||||
Gross Debt Gearing (%)(i) | 30.6 | 31.7 | ||||||
Net Debt Gearing (%)(ii) | 11.5 | 12.4 | ||||||
Current Ratio (times)(iii) | 1.51 | 1.46 | ||||||
Basic Earnings Per Share (US cents) | 0.01 | 0.01 | ||||||
Diluted Earnings Per Share (US cents) | 0.01 | 0.01 |
* | Includes 55,055,457 shares that are held as treasury shares and is computed based on 2,202,218,293 shares in issue as at the Latest Practicable Date. | |
Notes: | ||
(i) | Gross Debt Gearing is equal to Total Borrowings divided by Total Shareholders’ Equity. | |
(ii) | Net Debt Gearing is equal to Total Borrowings (net of Cash and Cash Equivalents) divided by Total Shareholders’ Equity. | |
(iii) | Current Ratio is equal to Current Assets divided by Current Liabilities. |
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(b) | Purchases made entirely out of capital and cancelled |
Before | After | |||||||
Share Purchase | Share Purchase | |||||||
(In US$’000, except per share data and ratios) | ||||||||
Share Capital | 2,035,235 | 2,021,960 | ||||||
Accumulated Other Comprehensive Loss | (12,308 | ) | (12,308 | ) | ||||
Accumulated Deficit | (474,270 | ) | (474,744 | ) | ||||
1,548,657 | 1,534,908 | |||||||
Treasury Shares | — | — | ||||||
Total Shareholders’ Equity | 1,548,657 | 1,534,908 | ||||||
Net Tangible Assets | 1,011,805 | 998,056 | ||||||
Current Assets | 571,308 | 571,308 | ||||||
Current Liabilities | 378,720 | 392,469 | ||||||
Total Borrowings | 473,453 | 486,728 | ||||||
Cash and Cash Equivalents | 295,916 | 295,916 | ||||||
Net Debt | 177,537 | 190,812 | ||||||
Number of Shares (’000) | 2,202,218 | 2,147,163 | * | |||||
Financial Ratios | ||||||||
Net Tangible Assets per Share (US$) | 0.46 | 0.46 | ||||||
Gross Debt Gearing (%)(i) | 30.6 | 31.7 | ||||||
Net Debt Gearing (%)(ii) | 11.5 | 12.4 | ||||||
Current Ratio (times)(iii) | 1.51 | 1.46 | ||||||
Basic Earnings Per Share (US cents) | 0.01 | 0.01 | ||||||
Diluted Earnings Per Share (US cents) | 0.01 | 0.01 |
* | Excludes 55,055,457 shares cancelled and is computed based on 2,202,218,293 shares in issue as at the Latest Practicable Date. | |
Notes: | ||
(i) | Gross Debt Gearing is equal to Total Borrowings divided by Total Shareholders’ Equity. | |
(ii) | Net Debt Gearing is equal to Total Borrowings (net of Cash and Cash Equivalents) divided by Total Shareholders’ Equity. | |
(iii) | Current Ratio is equal to Current Assets divided by Current Liabilities. |
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8. | Shares Repurchased |
8.1 | Disclosure of total number of shares repurchased | ||
STATS ChipPAC, as a foreign private issuer, is required to file an annual report on Form 20-F with the U.S. Securities and Exchange Commission, which requires disclosure, among other things, for each of the preceding twelve months during its most recently completed financial year, of the total number of shares repurchased as part of a publicly announced program and the maximum number (or approximate dollar value) of shares that may yet be purchased under the program. | |||
8.2 | Insider Trading Policy | ||
STATS ChipPAC has an Insider Trading Policy (the “Insider Trading Policy”) which guides and assists the Company and its Directors, officers and employees in the handling of corporate information and to prevent violations, whether inadvertent or otherwise, of the restrictions on insider trading under applicable laws and stock exchange rules. STATS ChipPAC will undertake any purchase or acquisition of shares pursuant to the Share Purchase Mandate in compliance with applicable insider trading laws and regulations. | |||
8.3 | Public Shareholders | ||
As at January 31, 2009, approximately 16.2% of the Shares are held by shareholders other than Temasek and our directors. In undertaking purchases or acquisitions of its Shares through Market Purchases, STATS ChipPAC’s intention is that the number of Shares remaining in the hands of the public will not fall to such a level as to cause market illiquidity, to affect orderly trading or to affect the listing of the shares on the SGX-ST. |
9. | Take-over Implications. Appendix 2 of the Singapore Code on Take-overs and Mergers (the “Code”) contains the Share Buy-Back Guidance Note applicable as at the Latest Practicable Date. The take-over implications arising from any purchase or acquisition by STATS ChipPAC of its shares are set out below: |
9.1 | Obligation to make a Take-over Offer | ||
If, as a result of any purchase or acquisition by STATS ChipPAC of its shares, a shareholder’s proportionate interest in the voting capital of STATS ChipPAC increases, such increase will be treated as an acquisition for the purposes of Rule 14 of the Code. If such increase results in a change of effective control, or, as a result of such increase, a shareholder or group of shareholders acting in concert obtains or consolidates effective control of STATS ChipPAC, such shareholder or group of shareholders acting in concert could become obliged to make a take-over offer for STATS ChipPAC under Rule 14 of the Code. | |||
9.2 | Persons Acting in Concert | ||
Under the Code, persons acting in concert comprise individuals or companies who, pursuant to an agreement or understanding (whether formal or informal), cooperate, through the acquisition by any of them of shares in a company, to obtain or consolidate effective control of that company. | |||
Unless the contrary is established, the Code presumes,inter alia, the following individuals and companies to be persons acting in concert with each other: |
(a) | a company with any of its directors (together with their close relatives, related trusts as well as companies controlled by any of the directors, their close relatives and related trusts); and | ||
(b) | a company, its parent, subsidiaries and fellow subsidiaries, and their associated companies and companies of which such companies are associated companies, and any person who has provided financial assistance (other than a bank in the ordinary course of business) to any of the aforementioned for the purchase of voting rights, all with each other. For this purpose, a company is an associated company of another company if the second company owns or controls at least 20% but not more than 50% of the voting rights of the first-mentioned company. |
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The circumstances under which shareholders of STATS ChipPAC (including Directors of STATS ChipPAC) and persons acting in concert with them respectively will incur an obligation to make a take-over offer under Rule 14 after a purchase or acquisition of shares by STATS ChipPAC are set out in Appendix 2 of the Code. |
9.3 | Effect of Rule 14 and Appendix 2 | ||
In general terms, the effect of Rule 14 and Appendix 2 is that, unless exempted, Directors of STATS ChipPAC and persons acting in concert with them will incur an obligation to make a take-over offer for STATS ChipPAC under Rule 14 if, as a result of STATS ChipPAC purchasing or acquiring its shares, the voting rights of such Directors and their concert parties would increase to 30% or more, or if the voting rights of such Directors and their concert parties fall between 30% and 50% of STATS ChipPAC’s voting rights, the voting rights of such Directors and their concert parties would increase by more than 1% in any period of six months. | |||
Under Appendix 2, a shareholder not acting in concert with the Directors of STATS ChipPAC will not be required to make a take-over offer under Rule 14 if, as a result of STATS ChipPAC purchasing or acquiring its shares, the voting rights of such shareholder in STATS ChipPAC would increase to 30% or more, or, if such shareholder holds not less than 30% but not more than 50% of STATS ChipPAC’s voting rights, the voting rights of such shareholder would increase by more than 1% in any period of six months. Such shareholder need not abstain from voting in respect of Resolution 7(f) authorising the Share Purchase Mandate.In calculating the percentages of voting rights of such Directors and their concert parties, treasury shares shall be excluded. | |||
Based on substantial shareholder notifications received by the STATS ChipPAC under Division 4, Part IV of the Companies Act as at the Latest Practicable Date as set out in the “Shareholdings and Share Trading” section of this Proxy Statement, none of the substantial shareholders of STATS ChipPAC would become obliged to make a take-over offer for STATS ChipPAC under Rule 14 of the Code as a result of the purchase by STATS ChipPAC of the maximum limit of 2.5% of its issued shares as at the Latest Practicable Date. |
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Name | Age | Position | ||
Board of Directors | ||||
Charles R. Wofford (1)(2)(3)(4) | 75 | Chairman of our Board of Directors | ||
Tan Lay Koon | 50 | Director, President and Chief Executive Officer | ||
Peter Seah Lim Huat (5)(6) | 62 | Director | ||
R. Douglas Norby (1)(5)(7) | 73 | Director | ||
Teng Cheong Kwee (1)(6)(8)(9) | 55 | Director | ||
Tokumasa Yasui (1)(9) | 64 | Director | ||
Phoon Siew Heng (8) | 45 | Director | ||
Senior Management | ||||
Wan Choong Hoe | 55 | Executive Vice President, Chief Operating Officer | ||
Han Byung Joon | 49 | Executive Vice President, Chief Technology Officer | ||
Hal Lasky (10) | 46 | Executive Vice President, Chief Sales Officer | ||
John Lau Tai Chong | 49 | Senior Vice President, Chief Financial Officer | ||
Janet T. Taylor | 51 | Senior Vice President, General Counsel |
Notes: | ||
(1) | Determined by our Board of Directors to be independent for the purposes of the Singapore Code of Corporate Governance 2005. | |
(2) | Chairman of the Executive Committee. | |
(3) | Chairman of the Executive Resource and Compensation Committee. | |
(4) | Chairman of the Nominating and Corporate Governance Committee. | |
(5) | Member of the Executive Resource and Compensation Committee. | |
(6) | Member of the Nominating and Corporate Governance Committee. | |
(7) | Chairman of the Audit Committee. | |
(8) | Member of the Executive Committee. | |
(9) | Member of the Audit Committee. | |
(10) | Appointed with effect from March 27, 2008. |
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• | consider, review, vary and approve our Company’s policy for determining executive remuneration including the remuneration policy with regard to Senior Management Executives; | ||
• | consider, review, vary (if necessary) and approve the entire specific remuneration package and service contract terms for each Senior Management Executive; |
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• | review and approve all of our option plans, stock plans and other equity-based plans; | ||
• | review and make recommendations to the Board with regard to each award to Senior Management Executives under each equity based plan; | ||
• | review and approve each award as well as the total proposed awards under each equity based plan in accordance with the rules governing each such plan, including awards to Directors; and | ||
• | approve the remuneration framework, including Director’s fees for our non-executive Directors. |
• | The Nominating and Corporate Governance Committee comprises not less than three Directors, the majority of whom, including the Chairman, qualify as independent Directors under the Singapore Code of Corporate Governance 2005. Our Board of Directors has determined that Mr. Charles R. Wofford and Mr. Teng Cheong Kwee are independent directors under the Singapore Code of Corporate Governance 2005. | ||
• | The Nominating and Corporate Governance Committee’s duties and responsibilities include the following: |
(i) | the identification of qualified candidates to become members of our Board of Directors; | ||
(ii) | the selection of nominees for election as directors at the next annual meeting of shareholders (or extraordinary general meeting of shareholders at which Directors are to be elected); | ||
(iii) | the selection of candidates to fill any vacancies on our Board of Directors; | ||
(iv) | the development and recommendation to our Board of Directors of a set of corporate governance guidelines and principles applicable to our Company (being our Code of Business Conduct and Ethics); and | ||
(v) | the oversight of the evaluation of our Board of Directors and its committees. |
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Executive | Non-executive | |||||||||||
Director | Directors (1) | Total (2) | ||||||||||
(In US$) | (In US$) | (In US$) | ||||||||||
Charles R. Wofford | $ | 132,000 | $ | 132,000 | ||||||||
Tan Lay Koon | $ | 1,767,252 | 1,767,252 | |||||||||
Peter Seah Lim Huat | 46,000 | 46,000 | ||||||||||
R. Douglas Norby | 69,000 | 69,000 | ||||||||||
Teng Cheong Kwee | 56,000 | 56,000 | ||||||||||
Tokumasa Yasui | 58,000 | 58,000 | ||||||||||
Phoon Siew Heng | 44,000 | (3) | 44,000 | (3) | ||||||||
Senior management (excluding our Chief Executive Officer) as a group | 2,946,638 | |||||||||||
$ | 1,767,252 | $ | 405,000 | $ | 5,118,890 | |||||||
Notes: | ||
(1) | We have sought advance approval, at our annual general meeting in April 2008, for the payment of directors’ fees of approximately US$518,000 for 2008. | |
(2) | Does not include compensation given in the form of share options and restricted share units. For more information on share options and restricted share units granted to our directors and senior management, see “Share Ownership for Directors and Senior Management.” Includes US$98,175 representing payment of one-third of the notional Economic Value Added (“EVA”) bank account. See discussion below. | |
(3) | Including the amount paid directly to Temasek during Mr. Phoon Siew Heng’s employment at Temasek. |
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Number of Ordinary Shares | Per Share Exercise | |||||||||
Issuable on Exercise of Option | Price (S$) | Exercisable Period | ||||||||
Tan Lay Koon | 700,000 | 2.826 | 10/19/2001 to 10/18/2010 | |||||||
325,000 | 2.885 | 04/29/2003 to 04/28/2012 | ||||||||
2,000,000 | 2.2 | 06/26/2003 to 06/25/2012 | ||||||||
700,000 | 1.99 | 08/06/2004 to 08/05/2013 | ||||||||
500,000 | 1.91 | 02/17/2005 to 02/16/2014 | ||||||||
Peter Seah Lim Huat | 70,000 | 1.99 | 08/06/2004 to 08/05/2013 | |||||||
35,000 | 1.91 | 02/17/2005 to 02/16/2014 | ||||||||
Teng Cheong Kwee | 35,000 | 1.91 | 02/17/2005 to 02/16/2009 |
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Number of Shares | Percentage | |||||||
Name of Beneficial Owner | Beneficially Owned | Beneficially Owned | ||||||
Temasek(1) | 1,845,715,689 | 83.8 | % |
(1) | As notified to our Company by Temasek, a private limited company incorporated in Singapore, wholly-owned by the Minister for Finance (Incorporated) of Singapore, a body corporate constituted by the Minister for Finance (Incorporation) Act (Cap. 183), which owns 100% of the ordinary shares of STSPL. Temasek is therefore deemed to beneficially own 1,845,715,689 of our ordinary shares, which are owned directly by STSPL. The percentage beneficially owned is based on an aggregate 2,202,218,293 ordinary shares outstanding as of January 31, 2009. |
• | Prior to the tender offer by STSPL in March 2007, Temasek beneficially owned, and its wholly-owned subsidiary, STSPL, directly owned, approximately 712,228,050 ordinary shares, which represented approximately 35.6% of our outstanding ordinary shares at that time. Upon the consummation of the tender offer in May 2007, Temasek beneficially owned, and STSPL directly owned, 1,838,819,759 ordinary shares (including ordinary shares represented by ADSs and ordinary shares issuable upon conversion of the US$134.5 million aggregate principal amount of our 2.5% convertible notes acquired by STSPL in the tender offer), which represented approximately 84.2% of our outstanding ordinary shares at that time. On May 22, 2008, STSPL converted into US145.1 million ordinary shares its entire US$134.5 million of our 2.5% convertible notes that it acquired in connection with its tender offer in 2007. |
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THE STATS CHIPPAC LTD. PERFORMANCE SHARE PLAN 2009
1. | NAME OF THE PLAN |
The Plan shall be called the “STATS ChipPAC Ltd. Performance Share Plan 2009”. |
2. | DEFINITIONS |
2.1 | In the Plan, unless the context otherwise requires, the following words and expressions shall have the following meanings: |
“Act” | : | The Companies Act, Chapter 50 of Singapore. | ||||
“Adoption Date” | : | The date on which the Plan is adopted by the Company in general meeting. | ||||
“Articles” | : | The Articles of Association of the Company, as amended from time to time. | ||||
“Auditors” | : | The auditors of the Company for the time being. | ||||
“Award” | : | A contingent award of Performance Shares granted under Rule 5. | ||||
“Award Date” | : | In relation to an Award, the date on which the Award is granted pursuant to Rule 5. | ||||
“Board” | : | The board of directors of the Company for the time being. | ||||
“Cause” | : | Means: | ||||
(a) | the Participant’s conduct constituting fraud, bad faith, misconduct, breach of fiduciary duty, gross negligence, material violation of applicable securities laws, conduct that is the subject of a criminal proceeding in connection with his employment with the Group; | |||||
(b) | the Participant’s failure or refusal to follow any lawful directive of the Board or CEO, provided that the Participant shall have received written notice from the Company of the specific acts of failure or refusal and shall have continued to engage in such acts or failures after receiving such notice; | |||||
(c) | the Participant engaging in any act of dishonesty, misrepresentation or other moral turpitude against the Company; or | |||||
(d) | the Participant’s failure to perform his duties and responsibilities in connection with his employment with the Group, provided that the Participant shall have received written notice from the Company of the failure and shall have continued to engage in such failure after receiving such notice. | |||||
“CDP” | : | The Central Depository (Pte) Limited. | ||||
“CEO” | : | The chief executive officer of the Company for the time being. |
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“Change in Control” | : | Means: | ||||
(a) | an acquisition by any person or group of persons acting together of Shares which hold more of the voting power of the Company’s voting Shares than do the Shares owned by Temasek or any of its subsidiaries; | |||||
(b) | a merger or reorganisation of the Company which results in a shareholder of the Company other than Temasek or any of its subsidiaries holding more than 50% of the voting power of the Company’s voting Shares; | |||||
(c) | a sale of all or substantially all of the Company’s assets; or | |||||
(d) | a dissolution or liquidation of the Company. | |||||
“Committee” | : | The Executive Resource and Compensation Committee of the Company for the time being. | ||||
“Communication” | : | An Award and/or any correspondence made or to be made under the Plan (individually or collectively). | ||||
“Company” | : | STATS ChipPAC Ltd., a company incorporated in Singapore. | ||||
“EBITDA” | : | The Company’s financial statement net income, subject to add backs for the following items: | ||||
(a) | tax expenses; | |||||
(b) | interest expenses; | |||||
(c) | depreciation and amortisation; and | |||||
(d) | one-time and non-cash items (including but not limited to stock based compensation, equity grant expenses, restructuring and impairment). | |||||
“EBITDA Targets” | : | The EBITDA targets set by the Committee. | ||||
“EBITDA Valuation Formula” | : | Has the meaning ascribed to it in Rule 7.6.2. | ||||
“EP” | : | The Company’s economic profits determined as EBITDA less the following items: | ||||
(a) | depreciation and amortisation; | |||||
(b) | tax expenses; and | |||||
(c) | cost of capital. | |||||
For these purposes, “cost of capital” means 11.295% of the aggregate of: | ||||||
(i) | net working capital (meaning, current assets (excluding cash and cash equivalents) less non-interest bearing liabilities); |
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(ii) | net fixed assets (meaning, gross fixed assets less accumulated depreciation); | |||||
(iii) | goodwill; and | |||||
(iv) | other non-current assets. | |||||
“EP Targets” | : | The EP targets set by the Committee. | ||||
“Free Cash Flow” or “FCF” | : | The Company’s EBITDA less the following items: | ||||
(a) | tax expense; | |||||
(b) | increase in working capital; | |||||
(c) | capital expenditure and intangibles; and | |||||
(d) | investment in the acquisition of the Bangkok facility from LSI (Thai) Ltd, a corporation incorporated in Thailand. | |||||
“FCF Targets” | : | The Free Cash Flow targets set by the Committee. | ||||
“Group” | : | The Company and its subsidiaries. | ||||
“Group Employee” | : | Any senior employee of the Group, including the CEO and any Group Executive Director. | ||||
“Group Executive Director” | : | A director of the Company and/or any of its subsidiaries, as the case may be, who performs an executive function. | ||||
“Listing Manual” | : | The listing manual of the Singapore Exchange. | ||||
“Market Day” | : | A day on which the Singapore Exchange is open for trading in securities. | ||||
“Ordinary Shares” | : | The number of outstanding Shares as of the Adoption Date on a fully-diluted basis, including Shares issuable upon conversion of all outstanding convertible bonds as of the Adoption Date, any Shares issued with regard to any future acquisition and any equity grants awarded prior to the Adoption Date, but for the avoidance of doubt does not include any adjustments due to dilution that may result from future share issuances (other than in the context of any future acquisitions involving the issuance of Shares and issuance of Shares with regard to equity grants awarded prior to the Adoption Date), or future grants of share options, restricted share units and performance shares. For the avoidance of doubt, the number of Ordinary Shares may not be varied by the Committee unless otherwise provided by these Rules. | ||||
“Participant” | : | The holder of an Award (including, where applicable, the executor or personal representative of such holder). | ||||
“Performance Multiplier” | : | Has the meaning ascribed to it in Rules 7.2.3(a), Rule 7.2.3(b) or Rule 7.2.4, as applicable. | ||||
“Performance Shares” | : | Represent unfunded and unsecured rights to receive Ordinary Shares. | ||||
“Performance Target Formula” | : | Has the meaning ascribed to it in Rule 7.2.3. |
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“Plan” | : | The STATS ChipPAC Ltd. Performance Share Plan 2009, as modified or altered from time to time. | ||||
“Prescribed Higher Amount” | : | Such dollar amount as set by the Committee. | ||||
“Prescribed Lower Amount” | : | Such dollar amount as set by the Committee. | ||||
“Qualified Public Offering” | : | Any public offering of the Shares on any stock exchange of recognized international reputation and standing duly approved by the Board. | ||||
“Qualified Termination” | : | In relation to a Participant, the termination of his employment with the Group due to that Participant’s death or disability, or the termination of his employment by the Group without Cause. | ||||
“Record Date” | : | The date fixed by the Company for the purposes of determining entitlements to dividends or other distributions to, or rights of, holders of Shares. | ||||
“Security Device” | : | Any smartcard, digital certificate, digital signature, encryption device, electronic key, logon identifier, password, personal identification number, and/or other code or any access procedure incorporating any one or more of the foregoing, designated by the Company for use in conjunction with the Plan. | ||||
“Shares” | : | Ordinary shares in the capital of the Company. | ||||
“Singapore Exchange” | : | The Singapore Exchange Securities Trading Limited. | ||||
“Syndication” | : | Means: | ||||
(a) | any transfer and/or assignment of only economic interests underlying part or all of the Shares held by Temasek or any of its subsidiaries, pursuant to an agreement between Temasek or any of its subsidiaries and a third party(ies), whereby Temasek or any of its subsidiaries retains full voting power of such Shares; or | |||||
(b) | any transfer and/or assignment of interests in part or all of the Shares held by Temasek or any of its subsidiaries to a third party(ies) pursuant to an agreement, whereby such third party(ies) agree to exercise its voting power in concert with Temasek or any of its subsidiaries. | |||||
“Temasek” | : | Temasek Holdings (Private) Limited, a company incorporated in Singapore. | ||||
“year” | : | Calendar year, unless otherwise stated. | ||||
“%” | : | Per centum or percentage. |
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2.2 | Words importing the singular number shall, where applicable, include the plural number and vice versa. Words importing the masculine gender shall, where applicable, include the feminine and neuter gender. | |
2.3 | Any reference to a time of a day in the Plan is a reference to Singapore time. | |
2.4 | Any reference in the Plan to any enactment is a reference to that enactment as for the time being amended or re-enacted. Any word defined under the Act or any statutory modification thereof and not otherwise defined in the Plan and used in the Plan shall have the meaning assigned to it under the Act or any statutory modification thereof, as the case may be. |
3. | OBJECTIVES OF THE PLAN |
The Plan is a share incentive scheme. The Plan is proposed on the basis that it is important to retain staff whose contributions are essential to the well-being and prosperity of the Group and to give recognition to senior employees and executive directors of the Group who have contributed to the growth of the Group. The Plan will give Participants an opportunity to have a personal equity interest in the Company and will help to achieve the following positive objectives: |
(a) | to align the interests of the Participants with the interests of the shareholders of the Company; | ||
(b) | to retain key employees and executive directors of the Group whose contributions are essential to the long-term growth and profitability of the Group; | ||
(c) | to instil loyalty to, and a stronger identification by Participants with the long-term prosperity of, the Group; | ||
(d) | to attract potential employees with relevant skills to contribute to the Group and to create value for the shareholders of the Company; and | ||
(e) | to motivate each Participant to optimise his performance standards and efficiency and to maintain a high level of contribution to the Group. |
4. | ELIGIBILITY OF PARTICIPANTS, ELIGIBLE PARTICIPANTS AS AT ADOPTION DATE |
4.1 | Group Employees who have attained the age of 21 years and hold such rank as may be designated by the Committee from time to time shall, unless they are also controlling shareholders (as defined in the Listing Manual) of the Company or associates (as defined in the Listing Manual) of such controlling shareholders, be eligible to participate in the Plan at the absolute discretion of the Committee. | |
4.2 | Up to 18 Group Employees may be awarded Performance Shares with respect to up to 3.35% of the outstanding Ordinary Shares, with the number of the Ordinary Shares available for delivery to be based on, subject as otherwise provided in these Rules and (in the case of the Group Employees other than the CEO) the Performance Target Formula, and further subject to: |
(a) | the Company achieving the EP Targets; and | ||
(b) | the Performance Multiplier, |
at each time of vesting of the Performance Shares, whether on a pro-rata basis or completely. In the event that the Performance Multiplier is applied up to the maximum permissible under the Plan, an aggregate of up to 5.02% of the Ordinary Shares could be payable and available for delivery in respect of the Performance Shares. |
5. | GRANT OF AWARDS |
5.1 | The Committee may grant Awards to such eligible Group Employees as the Committee may, on the recommendation of the management of the Company, select in its absolute discretion, at any time during the period when the Plan is in force. | |
5.2 | The number of Performance Shares to be granted to a Participant in accordance with the Plan shall be recommended by the management of the Company and determined at the absolute discretion of the Committee, which shall take into account such criteria as it considers fit. | |
5.3 | The Committee shall, on the recommendation of the management of the Company, decide in |
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relation to an Award: |
(a) | the Participant; | ||
(b) | the Award Date; | ||
(c) | the number of Performance Shares which are the subject of the Award; and | ||
(d) | any other condition which the Committee may determine in relation to that Award. |
5.4 | No consideration shall be payable for Awards or for Ordinary Shares receivable upon vesting of the Performance Shares. | |
5.5 | An Award shall be personal to the Participant to whom it is granted and, prior to the allotment to the Participant of the Shares to which the Award relates, shall not be transferred (other than to a Participant’s personal representative on the death of that Participant), charged, assigned, pledged or otherwise disposed of, in whole or in part, except with the prior approval of the Committee and if a Participant shall do, suffer or permit any such act or thing as a result of which he would or might be deprived of any rights under an Award without the prior approval of the Committee, that Award shall immediately lapse. |
6. | CONSEQUENCES OF TERMINATION OF EMPLOYMENT, CHANGE IN CONTROL OR SALE |
6.1 | Consequences of Termination of Employment | |
6.1.1 | An Award shall, to the extent not yet vested, immediately lapse without any claim whatsoever against the Company, and a Participant shall immediately forfeit all unvested Performance Shares comprised in any Award, in the event of termination of that Participant’s employment with the Group for Cause. | |
6.1.2 | In the event of termination of a Participant’s employment with the Group in a Qualified Termination before the Performance Shares comprised in his Award have vested, then: |
(a) | the Participant shall earn a pro-rata portion of the Performance Shares based on the length of the Participant’s employment with the Group during the period beginning on 1 January 2007 and ending on 31 December 2011, with the number of Ordinary Shares deliverable to be determined as and when the same is determined for the other Participants. Such pro-rata portion shall be determined in accordance with the same criteria and subject to the same performance metrics that such Participant’s Performance Shares would have been subject had the Participant continued his employment with the Company through 31 December 2011. Such terminated Participant shall receive payment with regard to his vested pro-rata portion of the Performance Shares on the same date the remaining Participants receive their vested Performance Share payments; and | ||
(b) | in the event the vesting of the pro-rata portion of the Performance Shares occurs on 31 December 2011, the Committee shall have discretion as to whether or not 100% of the Ordinary Shares deliverable in payment of thepro-rata portion of the Performance Shares shall become immediately payable, or whether 50% of the pro-rata portion of the Performance Shares will be forfeited. Should the Ordinary Shares be unavailable for payment as marketable securities, such Participants shall receive, in the form of cash from the Company, the value of such Ordinary Shares that would be otherwise payable, as determined in accordance with the EBITDA Valuation Formula. |
6.1.3 | In the event of termination of a Participant’s employment with Group before the Performance Shares have vested: |
(a) | otherwise than for Cause; or | ||
(b) | otherwise than in a Qualified Termination, |
the Committee shall have the discretion to determine whether or not such Participant shall be entitled to vesting and payment with respect to any portion of the unvested Performance Shares. | ||
6.1.4 | The Committee shall have the discretion to decide on the treatment of any unvested Performance Shares which have been forfeited pursuant to Rule 6.1. Without prejudice to the provisions of Rules 5.1, 5.2 and 5.3, such Performance Shares may be reallocated to any current, new or replacement Participants, taking into consideration the recommendations of the management of the Company. |
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6.2 | Consequences of Change in Control or Sale |
6.2.1 | In the event of a Change in Control, vesting of all Performance Shares and determination of the number of Ordinary Shares deliverable shall accelerate immediately prior to such Change in Control event, and the Participants shall have the right to participate in any sale transaction with Temasek or any of its subsidiaries (as the case may be) on a tag-along basis in any transaction resulting in a Change in Control with respect to all Ordinary Shares deliverable. | |
6.2.2 | In the event of a sale of Shares by Temasek or any of its subsidiaries which does not result in a Change in Control (including in any Qualified Public Offering but excluding in any Syndication), a pro-rata vesting of the Performance Shares comprised in outstanding Awards shall occur, and the Participants shall have the right to participate in any sale transaction with Temasek or any of its subsidiaries (as the case may be) on a tag-along basis with respect to all Ordinary Shares deliverable. | |
6.2.3 | The consideration for the sale of any Shares pursuant to any transaction contemplated by Rule 6.2 shall be in the form of marketable securities. However, if marketable securities are not available, the Participants shall receive, in the form of cash from the Company, the value of such Ordinary Shares that would be otherwise payable, as determined in accordance with the EBITDA Valuation Formula. |
7. | VESTING OF PERFORMANCE SHARES, DETERMINATION OF ORDINARY SHARES DELIVERABLE, PAYMENT AND OTHER PROVISIONS |
7.1 | Vesting of Performance Shares | |
Unless as otherwise provided in Rule 6, vesting of the Performance Shares comprised in outstanding Awards shall occur on 31 December 2011 and determination of the number of Ordinary Shares deliverable with respect to such Performance Shares shall occur thereafter in accordance with this Rule 7, subject to the Participant then being employed by the Group. | ||
7.2 | Determination of Number of Ordinary Shares Deliverable | |
7.2.1 | The delivery of Ordinary Shares shall be subject to the Company achieving the EP Targets. If vesting of the Performance Shares occurs: |
(a) | on 31 December 2011, only the EP Target for 2011 is applicable; and | ||
(b) | before 31 December 2011, the EP Target for the most recently completed financial year or for the most recently completed four financial quarters, as determined by the Committee, is applicable. |
7.2.2 | The number of Ordinary Shares to be delivered shall be determined by the Committee and shall, subject as otherwise provided in Rule 7.2.4, be subject to the Performance Multiplier at each time of vesting of the Performance Shares, whether on a pro-rata basis or completely, the minimum of which would be 50% of the number of Performance Shares which are the subject of the Award for EP of at least the Prescribed Lower Amount below the relevant EP Target and the maximum of which would be 150% of the number of Performance Shares which are the subject of the Award for EP of the Prescribed Higher Amount or more above the relevant EP Target, rounded down to the nearest whole Ordinary Share. In the event that the Performance Multiplier is applied up to the maximum permissible under the Plan, an aggregate of up to 5.02% of the Ordinary Shares could be payable and available for delivery in respect of the Performance Shares. | |
7.2.3 | In relation to all Participants other than the CEO, the EP Targets have been correlated to the EBITDA Targets and the Free Cash Flow Targets so that, subject to the Company achieving a minimum of the Prescribed Lower Amount below the applicable EP Target, the number of Ordinary Shares deliverable shall be calculated according to a weighted Performance Target Formula, with 70% of such Ordinary Shares to be determined using the EBITDA Target and the remaining 30% of such Ordinary Shares to be determined using the Free Cash Flow Target, both as set forth below: |
(a) | EBITDA. 70% of the total number of Ordinary Shares earned and payable in respect of the Performance Shares comprised in an Award shall be based on an EBITDA Target for the financial year ending on 31 December 2011 as set by the Committee, applying the following Performance Multiplier: |
(i) | 100% at EBITDA Target; |
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(ii) | 50% at an EBITDA Target derived from the level of the Prescribed Lower Amount below the corresponding EP Target; | ||
(iii) | 150% at an EBITDA Target derived from the level of the Prescribed Higher Amount above the corresponding EP Target, |
and proportionately between 50% and 150% of the EBITDA Target, in each case rounded down to the nearest whole Ordinary Share. | |||
In the event that the Performance Shares vest before 31 December 2011, 70% of the number of Ordinary Shares deliverable shall be based on the EBITDA Target for the most recently completed financial year as set by the Committee, or for the most recently completed four financial quarters, as determined by the Committee. | |||
(b) | Free Cash Flow. 30% of the total number of Ordinary Shares earned and payable in respect of the Performance Shares comprised in an Award shall be based on a Free Cash Flow Target for the financial year ending on 31 December 2011 as set by the Committee, applying the following Performance Multiplier: |
(i) | 100% at FCF Target; | ||
(ii) | 50% at an FCF Target derived from the level of the Prescribed Lower Amount below the corresponding EP Target; | ||
(iii) | 150% at an FCF Target derived from the level of the Prescribed Higher Amount above the corresponding EP Target, |
and proportionately between 50% and 150% of the FCF Target, in each case rounded down to the nearest whole Ordinary Share. | |||
In the event that the Performance Shares vest before 31 December 2011, 30% of the number of Ordinary Shares deliverable shall be based on the FCF Target for the most recently completed financial year as set by the Committee, or for the most recently completed four financial quarters, as determined by the Committee. |
7.2.4 | In relation to the CEO, subject to the Company achieving a minimum of the Prescribed Lower Amount below the applicable EP Target, the number of Ordinary Shares deliverable shall be calculated based on an EP Target for the financial year ending 31 December 2011 as set by the Committee, applying the following Performance Multiplier: |
(a) | 100% at EP Target; | ||
(b) | 50% at the Prescribed Lower Amount below the EP Target; | ||
(c) | 150% at the Prescribed Higher Amount above the EP Target, |
and proportionately between 50% and 150% of EP Target, in each case rounded down to the nearest whole Ordinary Share. | ||
In the event that the Performance Shares vest before 31 December 2011, the number of Ordinary Shares deliverable shall be based on the EP Target for the most recently completed financial year as set by the Committee, or for the most recently completed four financial quarters, as determined by the Committee. | ||
7.2.5 | Notwithstanding any other provision of these Rules: |
(a) | in relation to all Participants other than the CEO, where the relevant EBITDA Target and FCF Target are met but a minimum of the Prescribed Lower Amount below the applicable EP Target is not met; and | ||
(b) | in relation to the CEO, where a minimum of the Prescribed Lower Amount below the applicable EP Target is not met, |
the Committee shall have the power, in its good faith and reasonable discretion, to determine the number of Ordinary Shares deliverable in respect of the Performance Shares comprised in an Award. | ||
7.3 | Payment | |
7.3.1 | Subject to these Rules, to the Participant’s then being employed by the Group and on the basis that there is no event triggering full vesting of the Performance Shares and payout (or pro-rata vesting of the Performance Shares and payout in excess of 50%), upon vesting of the Performance Shares on 31 December 2011, 50% of the unissued Ordinary Shares deliverable in payment of the |
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Performance Shares comprised in an Award as determined pursuant to Rule 7.2 shall become immediately payable by way of an allotment to the Participant of the relevant number of Ordinary Shares. Should the Ordinary Shares be unavailable for payment as marketable securities, such Participants shall receive, in the form of cash from the Company, the value of such Ordinary Shares that would be otherwise payable, determined in accordance with the EBITDA Valuation Formula. The remaining 50% of the vested Performance Shares comprised in that Award shall remain as Ordinary Shares which have not been issued and shall be carried forward into a new share incentive plan to be adopted by the Company. | ||
7.3.2 | Payment shall be made as provided in these Rules no later than 15 March 2012, provided that the audited financial statements of the Company are then available. Otherwise, payment shall be made on such dateasthe Committee may determine to be appropriate. | |
7.4 | Listing and Quotation of Shares | |
7.4.1 | Where new Shares are allotted pursuant to these Rules at a time when the Shares are listed or quoted on the Singapore Exchange (and/or such other stock exchange upon which the Shares may be listed and quoted), the Company shall, as soon as practicable after such allotment, apply to the Singapore Exchange (and/or such other stock exchange upon which the Shares may be listed and quoted) for permission to deal in and for quotation of such Shares. | |
7.4.2 | In the event that the Shares are then listed or quoted on the Singapore Exchange, Shares which are allotted to a Participant pursuant to these Rules shall, unless otherwise determined by the Committee, be issued in the name of, or transferred to, CDP to the credit of the securities account of that Participant maintained with CDP or the securities sub-account of that Participant maintained with a depository agent, in each case, as designated by that Participant. | |
7.5 | Ranking of Shares | |
New Shares allotted and issued pursuant to these Rules shall: |
(a) | be subject to all the provisions of the Articles and the Memorandum of Association of the Company; and | ||
(b) | rank in full for all entitlements, including dividends or other distributions declared or recommended in respect of the then existing Shares, the Record Date for which is on or after the relevant vesting date of the Performance Shares, and shall in all other respects rank pari passu with other existing Shares then in issue. |
7.6 | Restrictions on Shares | |
7.6.1 | Prior to a Qualified Public Offering, Shares allotted and issued pursuant to these Rules shall be subject to the following restrictions and rights: |
(a) | a right of first refusal by Temasek or any of its subsidiaries, as the case may be, who is then a shareholder of the Company, on any sale by a Participant of his Shares; and | ||
(b) | a call right by Temasek or any of its subsidiaries, as the case may be, who is then a shareholder of the Company, and a put right by the Participant (or, at the discretion of the Committee, the beneficiaries of such Participant in the event of the Participant’s death) upon termination of the Participant’s employment with the Group. |
7.6.2 | The price for the transfer of Shares pursuant to this Rule 7.6 shall be based on the following EBITDA Valuation Formula: |
(a) | EBITDA of the Company multiplied by the ratio of enterprise value/EBITDA trailing twelve (12) months for the Company’s listed peers equals enterprise value* of the Company (“EV”). | ||
* Enterprise value of Company’s listed peers is calculated based on the average share price during the last two fiscal quarters prior to the valuation date. | |||
(b) | EV minus net debt of the Company and minority interest of the Company equals equity value at exit. | ||
(c) | Price of shares equals equity value at exit divided by the Ordinary Shares at exit. |
7.6.3 | The restrictions and rights set out in this Rule 7.6 do not apply as long as the Shares are listed and traded on the Singapore Exchange and/or any other internationally recognized stock exchange, and shall lapse on any Qualified Public Offering of the Shares. |
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8 | LIMITATIONS ON THE SIZE OF THE PLAN |
8.1 | The total number of Shares which may be issued pursuant to Awards granted under the Plan on any date: |
(a) | when added to the total number of new Shares issued and issuable pursuant to Awards granted under the Plan, shall not exceed 5.02% of the total number of the outstanding Ordinary Shares; and | ||
(b) | when added to the total number of new Shares issued and issuable pursuant to (i) Awards granted under the Plan, and (ii) any other equity grant plans adopted by the Company on or after the Adoption Date, shall not exceed 15% of the total number of issued Shares from time to time (excluding treasury shares). |
8.2 | The Ordinary Shares available for delivery under the Plan shall be authorized by the Company’s shareholders and all Ordinary Shares deliverable under the Plan will be authorized and approved by the Board. | |
8.3 | Without prejudice to the provisions of Rule 6.1.4, Shares which are the subject of Awards which have lapsed for any reason whatsoever may be the subject of further Awards granted by the Committee under the Plan. |
9. | ADJUSTMENT EVENTS |
9.1 | In the event of any dividend, share split, combination, or acquisition involving a share issuance or any exchange of shares, amalgamation, arrangement or consolidation, spin-off, recapitalisation or other distribution (other than ordinary cash dividends) of the assets of the Company to its shareholders, or any other change affecting the Ordinary Shares or the Share price, the Committee shall make such proportionate adjustments, if any, as necessary to reflect such change with respect to: |
(a) | the aggregate number and type of shares (subject to compliance with applicable laws) that may be delivered under the Plan; and | ||
(b) | the terms and conditions of any outstanding grants (including, without limitation, any applicable performance targets or criteria with respect thereto). |
9.2 | Notwithstanding the provisions of Rule 9.1, any adjustment (except in relation to a capitalisation issue) must be confirmed in writing by the Auditors (acting only as experts and not as arbitrators) to be in their opinion, fair and reasonable. | |
9.3 | Upon any adjustment made pursuant to this Rule 9, the Company shall notify the Participants in writing and deliver statements setting forth the class and/or number of shares which are the subject of the adjusted Awards to such Participants. Any adjustment shall take effect upon such written notification being given or on such date as may be specified in such written notification. |
10. | ADMINISTRATION OF THE PLAN |
10.1 | The Plan shall be administered by the Committee (or any other committee and/or persons duly authorized and appointed by the Board to administer the Plan) in its absolute discretion with such powers and duties as are conferred on it by the Board, provided that no member of the Committee shall participate in any deliberation or decision in respect of Awards granted or to be granted to him. | |
10.2 | Except to the extent certain terms and conditions are required by the Plan, the Committee shall have the power to make and vary such arrangements, guidelines and/or regulations (not being inconsistent with the Plan) for the implementation and administration of the Plan, to give effect to the provisions of the Plan and/or to enhance the benefit of the Awards to the Participants, as it may, in its absolute discretion, think fit. Without prejudice to the generality of the foregoing, the Committee has the broad discretion to select the Participants at any time the Plan is in effect, determine the terms and conditions of each Award and reallocate any forfeited Performance Shares to any current, new or replacement Participants, taking into consideration the recommendations of the management of the Company. Any matter pertaining or pursuant to the Plan and any dispute, difference or uncertainty as to the interpretation of the Plan or any rule, regulation or procedure thereunder or any rights under the Plan shall be determined by the Committee and binding in all respects. |
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10.3 | Neither the Plan nor Awards granted under the Plan shall impose on the Company or the Committee or any of its members any liability whatsoever in connection with: |
(a) | the lapsing of any Awards pursuant to any provision of the Plan; | ||
(b) | the failure or refusal by the Committee to exercise, or the exercise by the Committee of, any discretion under the Plan; and/or | ||
(c) | any decision or determination of the Committee made pursuant to any provision of the Plan. |
10.4 | Any decision or determination of the Committee made pursuant to any provision of the Plan (other than a matter to be certified by the Auditors) shall be final, binding and conclusive (including for the avoidance of doubt, any decisions pertaining to disputes as to the interpretation of the Plan or any rule, regulation or procedure hereunder or the application of any formula hereunder or as to any rights under the Plan). The Committee shall not be required to furnish any reasons for any decision or determination made by it. |
11. | NOTICES |
11.1 | Any notice required to be given by any Participant to the Company shall be sent or made to the registered office of the Company or such other address (including an electronic mail address) or facsimile number, and marked for the attention of the Committee (c/o the General Counsel of the Company), as may be notified by the Company to the Participant in writing. | |
11.2 | Any notices or documents required to be given to a Participant or any correspondence to be made between the Company and a Participant shall be given or made by the Committee (or such person(s) as it may from time to time direct) on behalf of the Company and shall be delivered to a Participant by hand or sent to a Participant at his home address, electronic mail address or facsimile number according to the records of the Company or the last known address, electronic mail address or facsimile number provided by the Participant to the Company. | |
11.3 | Any notice or other communication from a Participant to the Company shall be irrevocable, and shall not be effective until received by the Company. Any notice or communication from the Company to a Participant shall be deemed to be received by the Participant, when left at the address specified in Rule 11.2 or, if sent by post, on the day following the date of posting or, if sent by electronic mail or facsimile transmission, on the day of despatch. | |
11.4 | Any Communication under the Plan may be communicated electronically through the use of a Security Device, or through an electronic page, site, or environment designated by the Company which is accessible only through the use of a Security Device, and such Communication shall thereby be deemed to have been sent by the designated holder of such Security Device. | |
11.5 | The Company may accept and act upon any Communication issued and/or transmitted through the use of the Participant’s Security Device pursuant to Rule 11.4 (whether actually authorized by the Participant or not) as his authentic and duly authorized Communication and the Company shall be under no obligation to investigate the authenticity or authority of persons effecting the Communication or to verify the accuracy and completeness of the Communication and the Company may treat the Communication as valid and binding on the Participant, notwithstanding any error, fraud, forgery, lack of clarity or misunderstanding in the terms of such Communication. | |
11.6 | All Communications issued and/or transmitted through the use of a Participant’s Security Device pursuant to Rule 11.4 (whether authorized by the Participant or not) are irrevocable and binding on the Participant upon transmission to the Company and the Company shall be entitled to effect, perform or process such Communications without the Participant’s further consent and without any further reference or notice to the Participant. | |
11.7 | It shall be the Participant’s sole responsibility to ensure that all information contained in a Communication to the Company is complete, accurate, current, true and correct. | |
11.8 | Participants shall ensure (and shall take all necessary precautions to ensure) that: |
(a) | they comply with the Company’s procedural and/or operational guidelines relating to Security Devices; | ||
(b) | all their Security Devices are kept completely confidential and secure; and | ||
(c) | there is no unauthorized use or abuse of their Security Devices. |
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11.9 | Participants shall notify and/or contact the Company immediately if they become aware, have reason to believe, or suspect that any Security Device has become compromised, including but not limited to where: |
(a) | the security or integrity of any Security Device may have been compromised; | ||
(b) | such Security Device has become known or been revealed to any other person; | ||
(c) | there has been unauthorized use of the Security Device; and/or | ||
(d) | such Security Device is lost, damaged, defective or stolen, |
and Participants shall immediately cease to use such compromised Security Device until further notice from the Company. Participants shall be bound by all Communications and transactions resulting from any Communications made which are referable to any compromised Security Device until such time as the Company has received a notification from such Participants under this Rule 11.9. | ||
11.10 | The Company’s records of the Communications, and its record of any transactions maintained by any relevant person authorized by the Company relating to or connected with the Plan, whether stored in electronic or printed form, shall be binding and conclusive on a Participant and shall be conclusive evidence of such Communications and/or transactions. All such records shall be admissible in evidence and the Participant shall not challenge or dispute the admissibility, reliability, accuracy or the authenticity of the contents of such records merely on the basis that such records were incorporated and/or set out in electronic form or were produced by or are the output of a computer system, and the Participant waives any of his rights (if any) to so object. | |
11.11 | Any provision in these Rules requiring a Communication to be signed by a Participant may be satisfied in the case of an electronic Communication, by the execution of any on-line act, procedure or routine designated by the Company to signify the Participant’s intention to be bound by such Communication. |
12. | MODIFICATIONS TO THE PLAN |
12.1 | Any or all of the Rules of the Plan may be modified and/or altered at any time and from time to time by a resolution of the Committee, except that: |
(a) | no modification or alteration shall adversely affect the rights attached to any Award granted prior to such modification or alteration except with the consent in writing of not less than three-quarters in number of those Participants whose rights would be so adversely affected; | ||
(b) | the definitions of “Committee”, “Group” “Group Employee”, “Group Executive Director”, “Ordinary Shares” and “Participant” and the provisions of Rules 4, 5, 6, 7, 8, 9, 10 and this Rule 12 shall not be altered to the advantage of Participants except with the prior approval of the Company’s shareholders in general meeting; and | ||
(c) | no modification or alteration shall be made without the prior approval of the Singapore Exchange and such other regulatory authorities as may be necessary. |
For the purposes of Rule 12.1(a), the opinion of the Committee as to whether any modification or alteration would adversely alter the rights attached to any Award shall be final, binding and conclusive. For the avoidance of doubt, nothing in this Rule 12.1 shall affect the right of the Committee under any other provision of the Plan to amend or adjust any Award. | ||
12.2 | Notwithstanding anything to the contrary contained in Rule 12.1, the Committee may at any time by a resolution (and without other formality, save for the prior approval of the Singapore Exchange, if necessary) amend or alter the Plan in any way to the extent necessary or desirable, in the opinion of the Committee, to cause the Plan to comply with, or take into account, any statutory provision (or any amendment or modification thereto, including amendment of or modification to the Act) or the provision or the regulations of any regulatory or other relevant authority or body (including the Singapore Exchange, if applicable). | |
12.3 | Written notice of any modification or alteration made in accordance with this Rule 12 shall be given to all Participants. |
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13. | TERMS OF EMPLOYMENT UNAFFECTED |
The terms of employment of a Participant shall not be affected by his participation in the Plan, which shall neither form part of such terms nor entitle him to take into account such participation in calculating any compensation or damages on the termination of his employment for any reason. |
14. | DURATION OF THE PLAN |
14.1 | The Plan shall continue to be in force at the discretion of the Committee, subject to a maximum period of ten years commencing on the Adoption Date, provided always that the Plan may continue beyond the above stipulated period with the approval of the Company’s shareholders by ordinary resolution in general meeting and of any relevant authorities which may then be required. | |
14.2 | The Plan may be terminated at any time by the Committee or, at the discretion of the Committee, by resolution of the Company in general meeting, subject to all relevant approvals which may be required and if the Plan is so terminated, no further Awards shall be granted by the Committee hereunder. | |
14.3 | The expiry or termination of the Plan shall not affect Awards which have been granted prior to such expiry or termination, whether such Awards have vested (whether fully or partially) or not. |
15. | TAXES AND DEDUCTIONS |
All taxes (including income tax) arising from the granting, vesting or delivery of any Award granted to any Participant under the Plan shall be borne by that Participant. There shall be deducted or withheld from any payment to be made under the Plan any amounts which the Company or any of its subsidiaries is entitled, authorized or bound to deduct or withhold pursuant to applicable laws to account of income tax or other levies payable on the payment or any other applicable law or regulation. Without prejudice to the generality of the foregoing, if the payment should be subject to contributions in connection with any mandatory public savings plan administered by any governmental authority or statutory board, the Company shall be entitled to reduce the payment by an amount equal to such contribution amounts required to be made. |
16. | COSTS AND EXPENSES OF THE PLAN |
16.1 | Each Participant shall be responsible for all fees of CDP relating to or in connection with the issue and allotment of any Shares pursuant to the vesting of any Award in CDP’s name, the deposit of share certificate(s) with CDP, the Participant’s securities account with CDP, or the Participant’s securities sub-account with a CDP depository agent. | |
16.2 | Save for the taxes referred to in Rule 15 and such other costs and expenses expressly provided in the Plan to be payable by the Participants, all fees, costs and expenses incurred by the Company in relation to the Plan including but not limited to the fees, costs and expenses relating to the allotment and issue of Shares pursuant to the vesting of any Award shall be borne by the Company. |
17. | DISCLAIMER OF LIABILITY |
Notwithstanding any provisions herein contained, the Committee and the Company and the directors and employees of the Company shall not under any circumstances be held liable for any costs, losses, expenses and damages whatsoever and howsoever arising in any event, including but not limited to the delay by the Company in issuing the Shares or applying for or procuring the listing of new Shares on the Singapore Exchange (and/or such other stock exchange upon which the Shares may be listed or quoted) in accordance with Rule 7.4.1. |
18. | DISCLOSURES IN ANNUAL REPORT |
The Company will make such disclosures in its annual report for as long as the Plan continues in operation as required by the Listing Manual including the following (where applicable): |
(a) | the names of the members of the Committee administering the Plan; | ||
(b) | in respect of the following Participants of the Plan: |
(i) | Directors of the Company; and |
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(ii) | Participants (other than those in paragraph (i) above) who have received Shares pursuant to the vesting of Awards granted under the Plan which, in aggregate, represent 5% or more of the aggregate of the total number of new Shares available under the Plan, |
the following information: |
(aa) | the name of the Participant; and | ||
(bb) | the number of new Shares issued to such Participant during the financial year under review; and |
(c) | in relation to the Plan, the following particulars: |
(i) | the aggregate number of Performance Shares comprised in Awards granted under the Plan since the commencement of the Plan to the end of the financial year under review; | ||
(ii) | the aggregate number of Performance Shares comprised in Awards which have vested under the Plan since the commencement of the Plan to the end of the financial year under review; and | ||
(iii) | the aggregate number of Performance Shares comprised in Awards granted under the Plan which have not vested as at the end of the financial year under review, |
or as otherwise required under the Listing Manual from time to time. |
19. | GOVERNING LAW |
The Plan shall be governed by, and construed in accordance with, the laws of the Republic of Singapore. The Participants, by accepting grants of Awards in accordance with the Plan, and the Company submit to the exclusive jurisdiction of the courts of the Republic of Singapore. |
20. | CONTRACTS (RIGHTS OF THIRD PARTIES) ACT, CHAPTER 53B |
No person other than the Company or a Participant shall have any right to enforce any provision of the Plan or any Award by virtue of the Contracts (Rights of Third Parties) Act, Chapter 53B of Singapore. |
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THE STATS CHIPPAC LTD. EQUITY GRANT PLAN FOR NON-EXECUTIVE DIRECTORS
1. | NAME OF THE PLAN |
The Plan shall be called the “STATS ChipPAC Ltd. Equity Grant Plan for Non-Executive Directors”. |
2. | DEFINITIONS |
2.1 | In the Plan, unless the context otherwise requires, the following words and expressions shall have the following meanings: |
“Act” | : | The Companies Act, Chapter 50 of Singapore. | ||||
“Adoption Date” | : | The date on which the Plan is adopted by the Company in general meeting. | ||||
“Articles” | : | The Articles of Association of the Company, as amended from time to time. | ||||
“Auditors” | : | The auditors of the Company for the time being. | ||||
“Board” | : | The board of directors of the Company for the time being. | ||||
“CDP” | : | The Central Depository (Pte) Limited. | ||||
“Change in Control” | : | Means: | ||||
(a) | an acquisition by any person or group of persons acting together of Shares which hold more of the voting power of the Company’s voting Shares than do the Shares owned by Temasek or any of its subsidiaries; | |||||
(b) | a merger or reorganisation of the Company which results in a shareholder of the Company other than Temasek or any of its subsidiaries holding more than 50% of the voting power of the Company’s voting Shares; | |||||
(c) | a sale of all or substantially all of the Company’s assets; or | |||||
(d) | a dissolution or liquidation of the Company. | |||||
“Committee” | : | The Executive Resource and Compensation Committee of the Company for the time being. | ||||
“Communication” | : | Any correspondence made or to be made under the Plan (individually or collectively). | ||||
“Company” | : | STATS ChipPAC Ltd., a company incorporated in Singapore. | ||||
“EBITDA” | : | The Company’s financial statement net income, subject to add backs for the following items: | ||||
(a) | tax expenses; | |||||
(b) | interest expenses; | |||||
(c) | depreciation and amortisation; and | |||||
(d) | one-time and non-cash items (including but not limited to stock based compensation, equity grant expenses, restructuring and impairment). | |||||
“EBITDA Valuation Formula” | : | Has the meaning ascribed to it in Rule 7.6.2. |
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“EP” | : | The Company’s economic profits determined as EBITDA less the following items: | ||||
(a) | depreciation and amortisation; | |||||
(b) | tax expenses; and | |||||
(c) | cost of capital. | |||||
For these purposes, “cost of capital” means 11.295% of the aggregate of: | ||||||
(i) | net working capital (meaning, current assets (excluding cash and cash equivalents) less non-interest bearing liabilities); | |||||
(ii) | net fixed assets (meaning, gross fixed assets less accumulated depreciation); | |||||
(iii) | goodwill; and | |||||
(iv) | other non-current assets. | |||||
“EP Targets” | : | The EP targets set by the Committee. | ||||
“Group” | : | The Company and its subsidiaries. | ||||
“Listing Manual” | : | The listing manual of the Singapore Exchange. | ||||
“Non-Executive Directors” | : | A director of the Company who performs a non-executive function. | ||||
“Ordinary Shares” | : | The number of outstanding Shares as of the Adoption Date on a fully-diluted basis, including Shares issuable upon conversion of all outstanding convertible bonds as of the Adoption Date, any Shares issued with regard to any future acquisition and any equity grants awarded prior to the Adoption Date, but for the avoidance of doubt does not include any adjustments due to dilution that may result from future share issuances (other than in the context of any future acquisitions involving the issuance of Shares and issuance of Shares with regard to equity grants awarded prior to the Adoption Date), or future grants of share options, restricted share units and performance shares. For the avoidance of doubt, the number of Ordinary Shares may not be varied by the Committee unless otherwise provided by these Rules. | ||||
“Participant” | : | A Non-Executive Director to whom an offer to participate in the Plan has been extended pursuant to Rule 5 (including, where applicable, the executor or personal representative of such Non-Executive Director). | ||||
“Performance Multiplier” | : | Has the meaning ascribed to it in Rule 7. | ||||
“Performance Share Plan 2009” | : | The STATS ChipPAC Ltd. Performance Share Plan 2009, as modified or altered from time to time. | ||||
“Plan” | : | The STATS ChipPAC Ltd. Equity Grant Plan for Non-Executive Directors, as modified or altered from time to time. | ||||
“Prescribed Higher Amount” | : | Such dollar amount as set by the Committee. | ||||
“Prescribed Lower Amount” | : | Such dollar amount as set by the Committee. |
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“Qualified Public Offering” | : | Any public offering of the Shares on any stock exchange of recognized international reputation and standing duly approved by the Board. | ||||
“Record Date” | : | The date fixed by the Company for the purposes of determining entitlements to dividends or other distributions to, or rights of, holders of Shares. | ||||
“Shares” | : | Ordinary shares in the capital of the Company. | ||||
“Singapore Exchange” | : | The Singapore Exchange Securities Trading Limited. | ||||
“Syndication” | : | Means: | ||||
(a) | any transfer and/or assignment of only economic interests underlying part or all of the Shares held by Temasek or any of its subsidiaries, pursuant to an agreement between Temasek or any of its subsidiaries and a thirdparty(ies), whereby Temasek or any of its subsidiaries retains full voting power of such Shares; or | |||||
(b) | any transfer and/or assignment of interests in part or all of the Shares held by Temasek or any of its subsidiaries to a third party(ies) pursuant to an agreement, whereby such third party(ies) agree to exercise its voting power in concert with Temasek or any of its subsidiaries. | |||||
“Temasek” | : | Temasek Holdings (Private) Limited, a company incorporated in Singapore. | ||||
“year” | : | Calendar year, unless otherwise stated. | ||||
“%” | : | Per centum or percentage. |
2.2 | Words importing the singular number shall, where applicable, include the plural number and vice versa. Words importing the masculine gender shall, where applicable, include the feminine and neuter gender. | |
2.3 | Any reference to a time of a day in the Plan is a reference to Singapore time. | |
2.4 | Any reference in the Plan to any enactment is a reference to that enactment as for the time being amended or re-enacted. Any word defined under the Act or any statutory modification thereof and not otherwise defined in the Plan and used in the Plan shall have the meaning assigned to it under the Act or any statutory modification thereof, as the case may be. |
3. | OBJECTIVES OF THE PLAN |
The Plan is a share incentive scheme. The Plan is proposed on the basis that it is important to give recognition to non-executive directors of the Company who have contributed to the Group. The Plan will give Participants an opportunity to have a personal equity interest in the Company and will help to achieve the following positive objectives: |
(a) | to align the interests of the Participants with the interests of the shareholders of the Company; | ||
(b) | to motivate each Participant to maintain a high level of contribution to the Group; and | ||
(c) | to give recognition to the contributions made or to be made by Non-Executive Directors to the Group. |
4. | ELIGIBILITY OF PARTICIPANTS |
Non-Executive Directors shall, unless they are also controlling shareholders (as defined in the Listing Manual) of the Company or associates (as defined in the Listing Manual) of such controlling shareholders, be eligible to participate in the Plan at the absolute discretion of the Committee. |
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5. | OFFER TO PARTICIPATE |
5.1 | The Committee may extend an offer to participate in the Plan to such Non-Executive Directors as the Committee may select in its absolute discretion, at any time during the period when the Plan is in force. | |
5.2 | No consideration shall be payable for an offer to participate in the Plan made to, or for Ordinary Shares received by, Non-Executive Directors under the Plan. | |
5.3 | An offer to participate in the Plan shall be personal to the Participant to whom it is extended and, prior to the allotment to the Participant of the Ordinary Shares under the Plan, shall not be transferred (other than to a Participant’s personal representative on the death of that Participant), charged, assigned, pledged or otherwise disposed of, in whole or in part, except with the prior approval of the Committee and if a Participant shall do, suffer or permit any such act or thing as a result of which he would or might be deprived of any rights under an offer to participate in the Plan without the prior approval of the Committee, his participation in the Plan shall immediately cease. |
6. | CONSEQUENCES OF CESSATION AS NON-EXECUTIVE DIRECTOR AND CHANGE IN CONTROL OR SALE |
6.1 | Consequences of Cessation as Non-Executive Director | |
6.1.1 | In the event that a Participant ceases to be a Non-Executive Director for any reason whatsoever, his participation in the Plan shall, unless otherwise determined by the Committee, immediately cease without any claim whatsoever against the Company. | |
6.1.2 | Where the Committee exercises its discretion and determines that, a Participant’s participation in the Plan shall not cease even though such Participant has ceased to be a Non-Executive Director: |
(a) | that Participant may, at the discretion of the Committee, earn a pro-rata portion of the Ordinary Shares based on the length of the Participant’s service as a Non-Executive Director during the period beginning on 1 January 2007 and ending on 31 December 2011, with the number of Ordinary Shares issuable to be determined as and when the same is determined for the other Participants. Any such pro-rata portion shall be determined in accordance with the same criteria that such Participant would have been subject had the Participant continued to serve as a Non-Executive through 31 December 2011. Such Participant shall receive payment with regard to his pro-rata portion of the Ordinary Shares on the same date the remaining Participants receive their Ordinary Shares; and | ||
(b) | in the event the Ordinary Shares are issuable on or after 31 December 2011, the Committee shall have discretion as to whether or not 100% of the Ordinary Shares issuable in payment of the pro-rata portion of the Ordinary Shares issuable shall become immediately payable, or whether 50% of the pro-rata portion of the Ordinary Shares issuable will be forfeited. Should the Ordinary Shares be unavailable for payment as marketable securities, such Participants shall receive, in the form of cash from the Company, the value of such Ordinary Shares that would be otherwise payable, as determined in accordance with the EBITDA Valuation Formula. |
6.2 | Consequences of Change in Control or Sale | |
6.2.1 | In the event of a Change in Control, determination of the number of Ordinary Shares issuable shall accelerate immediately prior to such Change in Control event, and the Participants shall have the right to participate in any sale transaction with Temasek or any of its subsidiaries (as the case may be) on a tag-along basis in any transaction resulting in a Change in Control with respect to all Ordinary Shares issuable. | |
6.2.2 | In the event of a sale of Shares by Temasek or any of its subsidiaries which does not result in a Change in Control (including in any Qualified Public Offering but excluding in any Syndication), a pro-rata issuance of Ordinary Shares shall occur, and the Participants shall have the right to participate in any sale transaction with Temasek or any of its subsidiaries (as the case may be) on a tag-along basis with respect to all Ordinary Shares issuable. | |
6.2.3 | The consideration for the sale of any Ordinary Shares pursuant to any transaction contemplated by Rule 6.2 shall be in the form of marketable securities. However, if marketable securities are not available, the Participants shall receive, in the form of cash from the Company, the value of such Ordinary Shares that would be otherwise payable, as determined in accordance with the EBITDA Valuation Formula. |
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7. | DETERMINATION OF ORDINARY SHARES ISSUABLE, PAYMENT AND OTHER PROVISIONS |
7.1 | Determination of Number of Ordinary Shares Issuable |
7.1.1 | Unless as otherwise provided in Rule 6, determination of the number of Ordinary Shares issuable under the Plan shall occur on or after 31 December 2011 and in accordance with this Rule 7, subject to the Participant then holding office as a Non-Executive Director on 31 December 2011. | |
7.1.2 | The number of Ordinary Shares to be issued to each Participant shall be determined by the Committee, and shall depend on the extent to which the EP Targets are achieved or exceeded as well as any other criteria and considerations deemed appropriate by the Committee. If issuance of the Ordinary Shares occurs: |
(a) | on or after 31 December 2011, only the EP Target for 2011 is applicable; and | ||
(b) | before 31 December 2011, the EP Target for the most recently completed financial year or for the most recently completed four financial quarters, as determined by the Committee, is applicable. |
7.1.3 | The number of Ordinary Shares which may be issued under the Plan shall be calculated based on 0.30% of the outstanding Ordinary Shares (the “Base Number”), with the aggregate number of the Ordinary Shares available for delivery to be subject to these Rules and to the Performance Multiplier at each time of payment, whether on a pro-rata basis or completely, the minimum of which would be 50% of the Base Number to be issued for EP of at least the Prescribed Lower Amount below the relevant EP Target and the maximum of which would be 150% of the Base Number to be issued for EP of the Prescribed Higher Amount or more above the relevant EP Target (and proportionately between 50% and 150% of EP Target), rounded down to the nearest whole Ordinary Share. Where a minimum of the Prescribed Lower Amount below the relevant EP Target is not met, the Committee shall have the power, in its good faith and reasonable discretion, to determine the aggregate number of Ordinary Shares that may be deliverable. In the event that the Performance Multiplier is applied to the maximum extent permissible under the Plan, an aggregate of up to 0.45% of the Ordinary Shares could be payable and issued. | |
7.2 | Payment | |
7.2.1 | Subject to these Rules, to the Participant’s then holding office as a Non-Executive Director as of 31 December 2011 and on the basis that there is no event triggering full issuance of Ordinary Shares and payout (or pro-rata issuance of the Ordinary Shares and payout in excess of 50%), upon determination of the number of Ordinary Shares issuable on or after 31 December 2011, 50% of the unissued Ordinary Shares issuable shall become immediately payable by way of an allotment to the Participant of the relevant number of Ordinary Shares. Should the Ordinary Shares be unavailable for payment as marketable securities, such Participants shall receive, in the form of cash from the Company, the value of such Ordinary Shares that would be otherwise payable, determined in accordance with the EBITDA Valuation Formula. The remaining 50% of the Ordinary Shares issuable shall remain as unissued Ordinary Shares and shall be carried forward into a new share incentive plan to be adopted by the Company. | |
7.2.2 | Payment shall be made as provided in these Rules no later than 15 March 2012, provided that the audited financial statements of the Company are then available. Otherwise, payment shall be made on such date as the Committee may determine to be appropriate. | |
7.3 | Listing and Quotation of Shares | |
7.3.1 | Where new Shares are allotted pursuant to these Rules at a time when the Shares are listed or quoted on the Singapore Exchange (and/or such other stock exchange upon which the Shares may be listed and quoted), the Company shall, as soon as practicable after such allotment, apply to the Singapore Exchange (and/or such other stock exchange upon which the Shares may be listed and quoted) for permission to deal in and for quotation of such Shares. | |
7.3.2 | In the event that the Shares are then listed or quoted on the Singapore Exchange, Shares which are allotted to a Participant pursuant to these Rules shall, unless otherwise determined by the Committee, be issued in the name of, or transferred to, CDP to the credit of the securities account of that Participant maintained with CDP or the securitiessub-account of that Participant maintained with a depository agent, in each case, as designated by that Participant. |
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7.4 | Ranking of Shares | |
New Shares allotted and issued pursuant to these Rules shall: |
(a) | be subject to all the provisions of the Articles and the Memorandum of Association of the Company; and | ||
(b) | rank in full for all entitlements, including dividends or other distributions declared or recommended in respect of the then existing Shares, the Record Date for which is on or after the date the Ordinary Shares are issued pursuant to the Plan, and shall in all other respects rank pari passu with other existing Shares then in issue. |
7.5 | Restrictions on Shares | |
7.5.1 | Prior to a Qualified Public Offering, Shares allotted and issued pursuant to these Rules shall be subject to the following restrictions and rights: |
(a) | a right of first refusal by Temasek or any of its subsidiaries, as the case may be, who is then a shareholder of the Company, on any sale by a Participant of his Shares; and | ||
(b) | a call right by Temasek or any of its subsidiaries, as the case may be, who is then a shareholder of the Company, and a put right by the Participant (or, at the discretion of the Committee, the beneficiaries of such Participant in the event of the Participant’s death) upon a Participant ceasing to hold office as a Non-Executive Director. |
7.5.2 | The price for the transfer of Shares pursuant to this Rule 7.6 shall be based on the following EBITDA Valuation Formula: |
(a) | EBITDA of the Company multiplied by the ratio of enterprise value/EBITDA trailing twelve (12) months for the Company’s listed peers equals enterprise value* of the Company (“EV”). | ||
* Enterprise value of Company’s listed peers is calculated based on the average share price during the last two fiscal quarters prior to the valuation date. | |||
(b) | EV minus net debt of the Company and minority interest of the Company equals equity value at exit. | ||
(c) | Price of shares equals equity value at exit divided by the Ordinary Shares at exit. |
7.5.3 | The restrictions and rights set out in this Rule 7.6 do not apply as long as the Shares are listed and traded on the Singapore Exchange and/or any other internationally recognized stock exchange, and shall lapse on any Qualified Public Offering of the Shares. |
8 | LIMITATIONS ON THE SIZE OF THE PLAN |
8.1 | The total number of Shares which may be issued under the Plan on any date: |
(a) | when added to the total number of new Shares issued and issuable under the Plan, shall not exceed 0.45% of the total number of the outstanding Ordinary Shares; and | ||
(b) | when added to the total number of new Shares issued and issuable (i) under the Plan, and (ii) pursuant to awards granted under the Performance Share Plan 2009, shall not exceed 15% of the total number of issued Shares from time to time (excluding treasury shares). |
8.2 | The Ordinary Shares available for issuance under the Plan shall be authorized by the Company’s shareholders and all Ordinary Shares issuable under the Plan will be authorized and approved by the Board. |
9. | ADJUSTMENT EVENTS |
9.1 | In the event of any dividend, share split, combination, or acquisition involving a share issuance or any exchange of shares, amalgamation, arrangement or consolidation, spin-off, recapitalisation or other distribution (other than ordinary cash dividends) of the assets of the Company to its shareholders, or any other change affecting the Ordinary Shares or the Share price, the Committee shall make such proportionate adjustments, if any, as necessary to reflect such change with respect to the aggregate number and type of shares (subject to compliance with applicable laws) that may be issued under the Plan and the applicable performance targets or criteria with respect thereto. |
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9.2 | Notwithstanding the provisions of Rule 9.1, any adjustment (except in relation to a capitalisation issue) must be confirmed in writing by the Auditors (acting only as experts and not as arbitrators) to be in their opinion, fair and reasonable. | |
9.3 | Upon any adjustment made pursuant to this Rule 9, the Company shall notify the Participants in writing. Any adjustment shall take effect upon such written notification being given or on such date as may be specified in such written notification. |
10. | ADMINISTRATION OF THE PLAN |
10.1 | The Plan shall be administered by the Committee (or any other committee and/or persons duly authorized and appointed by the Board to administer the Plan) in its absolute discretion with such powers and duties as are conferred on it by the Board, provided that no member of the Committee shall participate in any deliberation or decision in respect of Ordinary Shares issuable to him under the Plan. | |
10.2 | Except to the extent certain terms and conditions are required by the Plan, the Committee shall have the power to make and vary such arrangements, guidelines and/or regulations (not being inconsistent with the Plan) for the implementation and administration of the Plan and/or to give effect to the provisions of the Plan, as it may, in its absolute discretion, think fit. Without prejudice to the generality of the foregoing, the Committee has the broad discretion to select the Participants at any time the Plan is in effect and each Participant’s participation in the Plan. Any matter pertaining or pursuant to the Plan and any dispute, difference or uncertainty as to the interpretation of the Plan or any rule, regulation or procedure thereunder or any rights under the Plan shall be determined by the Committee and binding in all respects. | |
10.3 | The Plan shall not impose on the Company or the Committee or any of its members any liability whatsoever in connection with: |
(a) | the failure or refusal by the Committee to exercise, or the exercise by the Committee of, any discretion under the Plan; and/or | ||
(b) | any decision or determination of the Committee made pursuant to any provision of the Plan. |
10.4 | Any decision or determination of the Committee made pursuant to any provision of the Plan (other than a matter to be certified by the Auditors) shall be final, binding and conclusive (including for the avoidance of doubt, any decisions pertaining to disputes as to the interpretation of the Plan or any rule, regulation or procedure hereunder or the application of any formula hereunder or as to any rights under the Plan). The Committee shall not be required to furnish any reasons for any decision or determination made by it. |
11. | NOTICES |
11.1 | Any notice required to be given by any Participant to the Company shall be sent or made to the registered office of the Company or such other address (including an electronic mail address) or facsimile number, and marked for the attention of the Committee (c/o the General Counsel of the Company), as may be notified by the Company to the Participant in writing. | |
11.2 | Any notices or documents required to be given to a Participant or any correspondence to be made between the Company and a Participant shall be given or made by the Committee (or such person(s) as it may from time to time direct) on behalf of the Company and shall be delivered to a Participant by hand or sent to a Participant at his home address, electronic mail address or facsimile number according to the records of the Company or the last known address, electronic mail address or facsimile number provided by the Participant to the Company. | |
11.3 | Any notice or other communication from a Participant to the Company shall be irrevocable, and shall not be effective until received by the Company. Any notice or communication from the Company to a Participant shall be deemed to be received by the Participant, when left at the address specified in Rule 11.2 or, if sent by post, on the day following the date of posting or, if sent by electronic mail or facsimile transmission, on the day of despatch. | |
11.4 | It shall be the Participant’s sole responsibility to ensure that all information contained in a Communication to the Company is complete, accurate, current, true and correct. | |
11.5 | The Company’s records of the Communications, and its record of any transactions maintained by any relevant person authorized by the Company relating to or connected with the Plan, whether stored in electronic or printed form, shall be binding and conclusive on a Participant and shall be conclusive evidence of such Communications and/or transactions. All such records shall be admissible in evidence and the Participant shall not challenge or dispute the admissibility, reliability, accuracy or the authenticity of the contents of such records merely on the basis that such records were incorporated and/or set out in |
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electronic form or were produced by or are the output of a computer system, and the Participant waives any of his rights (if any) to so object. | ||
11.6 | Any provision in these Rules requiring a Communication to be signed by a Participant may be satisfied in the case of an electronic Communication, by the execution of any on-line act, procedure or routine designated by the Company to signify the Participant’s intention to be bound by such Communication. |
12. | MODIFICATIONS TO THE PLAN |
12.1 | Any or all of the Rules of the Plan may be modified and/or altered at any time and from time to time by a resolution of the Committee, except that: |
(a) | no modification or alteration shall adversely affect the rights of any Participant except with the consent in writing of not less than a majority in number of those Participants whose rights would be so adversely affected; | ||
(b) | the definitions of “Committee”, “Group”, “Non-Executive Director”, “Ordinary Shares” and “Participant” and the provisions of Rules 4, 5, 6, 7, 8, 9, 10 and this Rule 12 shall not be altered to the advantage of Participants except with the prior approval of the Company’s shareholders in general meeting; and | ||
(c) | no modification or alteration shall be made without the prior approval of the Singapore Exchange and such other regulatory authorities as may be necessary. |
For the purposes of Rule 12.1(a), the opinion of the Committee as to whether any modification or alteration would adversely alter the rights of any Participant shall be final, binding and conclusive. For the avoidance of doubt, nothing in this Rule 12.1 shall affect the right of the Committee under any other provision of the Plan to amend or adjust any provision of the Plan or any offer to participate in the Plan. | ||
12.2 | Notwithstanding anything to the contrary contained in Rule 12.1, the Committee may at any time by a resolution (and without other formality, save for the prior approval of the Singapore Exchange, if necessary) amend or alter the Plan in any way to the extent necessary or desirable, in the opinion of the Committee, to cause the Plan to comply with, or take into account, any statutory provision (or any amendment or modification thereto, including amendment of or modification to the Act) or the provision or the regulations of any regulatory or other relevant authority or body (including the Singapore Exchange, if applicable). | |
12.3 | Written notice of any modification or alteration made in accordance with this Rule 12 shall be given to all Participants. |
13. | DURATION OF THE PLAN |
13.1 | The Plan shall continue to be in force at the discretion of the Committee, subject to a maximum period of ten years commencing on the Adoption Date, provided always that the Plan may continue beyond the above stipulated period with the approval of the Company’s shareholders by ordinary resolution in general meeting and of any relevant authorities which may then be required. | |
13.2 | The Plan may be terminated at any time by the Committee or, at the discretion of the Committee, by resolution of the Company in a general meeting, subject to all relevant approvals which may be required and if the Plan is so terminated, no further Ordinary Shares shall be issued by the Committee hereunder. |
14. | TAXES AND DEDUCTIONS |
All taxes (including income tax) arising from the allotment and issuance of Ordinary Shares to any Participant under the Plan shall be borne by that Participant. There shall be deducted or withheld from any payment to be made under the Plan any amounts which the Company or any of its subsidiaries is entitled, authorized or bound to deduct or withhold pursuant to applicable laws to account of income tax or other levies payable on the payment or any other applicable law or regulation. Without prejudice to the generality of the foregoing, if the payment should be subject to contributions in connection with any mandatory public savings plan administered by any governmental authority or statutory board, the Company shall be entitled to reduce the payment by an amount equal to such contribution amounts required to be made. |
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15. | COSTS AND EXPENSES OF THE PLAN |
15.1 | Each Participant shall be responsible for all fees of CDP relating to or in connection with the issue and allotment of any Shares in CDP’s name, the deposit of share certificate(s) with CDP, the Participant’s securities account with CDP, or the Participant’s securities sub-account with a CDP depository agent. | |
15.2 | Save for the taxes referred to in Rule 14 and such other costs and expenses expressly provided in the Plan to be payable by the Participants, all fees, costs and expenses incurred by the Company in relation to the Plan including but not limited to the fees, costs and expenses relating to the allotment and issue of Shares shall be borne by the Company. |
16. | DISCLAIMER OF LIABILITY |
Notwithstanding any provisions herein contained, the Committee and the Company and the directors and employees of the Company shall not under any circumstances be held liable for any costs, losses, expenses and damages whatsoever and howsoever arising in any event, including but not limited to the delay by the Company in issuing the Shares or applying for or procuring the listing of new Shares on the Singapore Exchange (and/or such other stock exchange upon which the Shares may be listed or quoted) in accordance with Rule 7.4.1. |
17. | DISCLOSURES IN ANNUAL REPORT |
The Company will make such disclosures in its annual report for as long as the Plan continues in operation as required by the Listing Manual including the following (where applicable): |
(a) | the names of the members of the Committee administering the Plan; | ||
(b) | in respect of all the Participants of the Plan, the following information: |
(aa) | the name of the Participant; and | ||
(bb) | the number of new Shares issued to such Participant during the financial year under review; and |
(c) | in relation to the Plan, the aggregate number of Ordinary Shares that have been allotted and issued under the Plan since the commencement of the Plan to the end of the financial year under review, |
or as otherwise required under the Listing Manual from time to time. |
18. | GOVERNING LAW |
The Plan shall be governed by, and construed in accordance with, the laws of the Republic of Singapore. Each Participant, by accepting an offer to participate in accordance with the Plan, and the Company submit to the exclusive jurisdiction of the courts of the Republic of Singapore. |
19. | CONTRACTS (RIGHTS OF THIRD PARTIES) ACT, CHAPTER 53B |
No person other than the Company or a Participant shall have any right to enforce any provision of the Plan or any offer to participate in the Plan by virtue of the Contracts (Rights of Third Parties) Act, Chapter 53B of Singapore. |
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(Company Registration Number 199407932D)
IMPORTANT
1. | For Investors who have used their CPF moneys to buy shares of STATS ChipPAC Ltd., the Annual Report 2008 is forwarded to them at the request of their CPF Approved Nominees and is sent solely FOR INFORMATION ONLY. | |
2. | This Proxy Form is not valid for use by CPF Investors and shall be ineffective for all intents and purposes if used or purported to be used by them. | |
3. | CPF Investors who wish to vote should contact their CPF Approved Nominees. |
I/We, | (Name) of | |||
(Address) | ||||
being a shareholder(s) of STATS ChipPAC Ltd. (the “Company”) hereby appoint:- |
Name | Address | NRIC/ Passport No. | Proportion of Shareholding | ||||||||
(%) | |||||||||||
*and/or | |||||||||||
as my/our proxy, to attend and to vote for me/us on my/our behalf and, if necessary, to demand a poll, at the Fifteenth Annual General Meeting (“Fifteenth AGM”) of the Company to be held at The Grassroots’ Club, 190 Ang Mo Kio Avenue 8, Singapore 568046, on April 27, 2009 at 10.00 a.m. (Singapore time), and at any adjournment thereof.
(Please indicate with an “X” in the spaces provided whether you wish your vote(s) to be cast for or against the Resolutions as set out in the Notice of the Fifteenth AGM and summarised below. In the absence of any specific directions, the proxy/proxies will vote or abstain as he/they may think fit, as he/they will on any other matter arising at the Fifteenth AGM.)
No. | Routine Business — Ordinary Resolutions | For | Against | ||||||||||
1 | To adopt the Audited Financial Statements of the Company for the year ended December 28, 2008, together with the Reports of the Directors and the Auditors. | ||||||||||||
2 | To appoint Mr. Rohit Sipahimalani as a Director of the Company pursuant to Article 99 of the Company’s Articles of Association. | ||||||||||||
3(a) | To re-elect Mr. Teng Cheong Kwee as a Director of the Company pursuant to Article 94 of the Company’s Articles of Association. | ||||||||||||
3(b) | To re-elect Mr. Tokumasa Yasui as a Director of the Company pursuant to Article 94 of the Company’s Articles of Association. | ||||||||||||
4(a) | To re-appoint Mr. Charles R. Wofford as a Director of the Company pursuant to Section 153(6) of the Companies Act, Chapter 50. | ||||||||||||
4(b) | To re-appoint Mr. R. Douglas Norby as a Director of the Company pursuant to Section 153(6) of the Companies Act, Chapter 50. | ||||||||||||
5 | To re-appoint PricewaterhouseCoopers as Auditors and to authorize the Directors to fix their remuneration. | ||||||||||||
6 | To approve Directors’ fees totalling approximately US$473,000 for the year ending December 27, 2009. | ||||||||||||
Special Business — Ordinary Resolutions | |||||||||||||
7(a) | To authorize the Directors to allot and issue shares in the capital of the Company and to create and issue instruments and to allot and issue shares in the capital of the Company in connection therewith pursuant to Section 161 of the Companies Act, Chapter 50. | ||||||||||||
7(b) | To authorize the Directors to allot and issue shares in the capital of the Company pursuant to the exercise of the options under the STATS ChipPAC Ltd. Substitute Share Purchase and Option Plan and the STATS ChipPAC Ltd. Substitute Equity Incentive Plan. | ||||||||||||
7(c) | To authorize the Directors to allot and issue shares in the capital of the Company pursuant to the exercise of the options granted under the STATS ChipPAC Ltd. Share Option Plan, as amended. | ||||||||||||
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No. | Special Business — Ordinary Resolutions | ||||||||||||
7(d) | To adopt the STATS ChipPAC Ltd. Performance Share Plan 2009 (“PSP 2009”) as substantially set out in Appendix 1 to the Proxy Statement and authorize the Directors tointer aliagrant Performance Shares, which represent unfunded and unsecured rights to receive ordinary shares in the capital of the Company, in accordance with the provisions of PSP 2009 and to allot and issue for time to time such number of fully paid-up ordinary shares in the capital of the Company as may be required to be allotted and issued pursuant to the terms of the PSP 2009. | ||||||||||||
7(e) | To adopt the STATS ChipPAC Ltd. Equity Grant Plan for Non-Executive Directors (“NED Plan”) as substantially set out in Appendix 2 to the Proxy Statement and authorize the Directors tointer aliamake offers to selected Non-Executive Directors to participate in the NED Plan, in accordance with the NED Plan and to allot and issue from time to time such number of fully paid-up ordinary shares in the capital of the Company as may be required to be allotted and issued pursuant to the terms of the NED Plan. | ||||||||||||
7(f) | To approve the renewal of the Share Purchase Mandate. | ||||||||||||
Dated this _________ day of _________________ 2009.
Total Number of Shares Held | ||||
| ||||
IMPORTANT Please read Notes |
| ||||
Signature(s) of Shareholder(s)/Common Seal | ||||
*Please delete accordingly. |
Notes:-
1. | Please insert the total number of ordinary shares (“Shares”) held by you. If you have Shares entered against your name in the Depository Register (as defined in Section 130A of the Companies Act, Chapter 50 of Singapore), you should insert that number of Shares. If you have Shares registered in your name in the Register of Shareholders (i.e. Members), you should insert that number of Shares. If you have Shares entered against your name in the Depository Register and Shares registered in your name in the Register of Shareholders (i.e. Members), you should insert the aggregate number of Shares entered against your name in the Depository Register and registered in your name in the Register of Shareholders (i.e. Members). If no number is inserted, the instrument appointing a proxy or proxies shall be deemed to relate to all the Shares held by you. | |
2. | A shareholder is a person whose name appears on the Depository Register of The Central Depository (Pte) Limited in Singapore or a person registered in the Company’s Register of Shareholders (i.e. Members). A shareholder of the Company entitled to attend and vote at a meeting of the Company is entitled to appoint one or two proxies to attend and vote instead of him. A proxy need not be a shareholder of the Company. | |
3. | Where a shareholder appoints two proxies, the appointments shall be invalid unless he specifies the proportion of his shareholding (expressed as a percentage of the whole) to be represented by each proxy. | |
4. | The instrument appointing a proxy or proxies must be deposited at registered office of the Company at 10 Ang Mo Kio Street 65, TechPoint #05-17/20, Singapore 569059 not less than 48 hours before the time appointed for the Fifteenth Annual General Meeting. | |
5. | The instrument appointing a proxy or proxies must be under the hand of the appointor or of his attorney duly authorized in writing. Where the instrument appointing a proxy or proxies is executed by a corporation, it must be executed either under its seal or under the hand of an officer or attorney duly authorized. | |
6. | A corporation which is a shareholder may authorize by resolution of its directors or other governing body such person as it thinks fit to act as its representative at the Fifteenth Annual General Meeting, in accordance with Section 179 of the Companies Act, Chapter 50 of Singapore. |
General:
The Company shall be entitled to reject the instrument appointing a proxy or proxies if it is incomplete, improperly completed or illegible or where the true intentions of the appointor are not ascertainable from the instructions of the appointor specified in the instrument appointing a proxy or proxies. In addition, in the case of Shares entered in the Depository Register, the Company may reject any instrument appointing a proxy or proxies lodged if the shareholder, being the appointor, is not shown to have Shares entered against his name in the Depository Register as at 48 hours before the time appointed for holding the Fifteenth Annual General Meeting, as certified by The Central Depository (Pte) Limited to the Company.
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