EXHIBIT 4.9aaaa
TAIWAN SEMICONDUCTOR MANUFACTURING COMPANY LIMITED
2004 EMPLOYEE STOCK OPTIONS PLAN
(TRANSLATION)
1. PURPOSE
The purpose of the 2004 Employee Stock Options Plan (the "Plan") of Taiwan
Semiconductor Manufacturing Company Limited (the "Company") is to promote
the interests of the Company and its shareholders by attracting and
retaining the high-tech talents/professionals of the Company and its
subsidiaries by means of incentives in the form of stock options.
2. PERIOD OF GRANT
The Company may grant the options in one or more tranches within one (1)
year from the date of receipt of notice from the relevant authority
("Authority") indicating that the Company's filing of the Plan with the
Authority has become effective. The actual dates of grant will be
determined by the Chairman of the Board of Directors of the Company (the
"Chairman").
3. OPTIONEE
Each optionee shall be a full-time employee of either the Company or any
of its domestic or foreign subsidiaries, in which the Company's
shareholding with voting rights, directly or indirectly, is more than
fifty percent (50%). Whether an employee is entitled to receive options,
and the number of options to be received, shall be reviewed and determined
by the Chairman taking into consideration factors as relates to job grade,
performance, contribution, special achievement and/or years of employment,
subject to approval by the Compensation Committee of the Board of
Directors of the Company. The number of options granted to any optionee in
any tranche shall not exceed ten percent (10%) of the total number of
options granted in that tranche, and the total number of options to be
exercised by any optionee within each fiscal year shall not exceed one
percent (1%) of the outstanding common shares of the Company at the
year-end.
4. TOTAL NUMBER OF OPTIONS TO BE GRANTED
The total number of options authorized to be granted with respect to the
Plan shall be 11,000,000 units, with one (1) unit entitled to subscribe
one (1) common share of the Company. The total number of common shares of
the Company to be reserved for granting the options shall be 11,000,000
shares.
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5. TERMS AND CONDITIONS
(1) Exercise Price
The exercise price of the options shall be the closing price of the
Company's common shares on the date that the options are granted.
(2) Vesting Schedule
The options will not vest in the first two (2) years ("Waiting
Period") and may be exercised in accordance with the following
schedule. The options will be existent for ten (10) years and may
not be transferred, except by inheritance.
Number of Years after Accumulated Percentage of
the Date the Options are Options Exercisable
Granted
2 years 50%
3 years 75%
4 years 100%
(3) Type of Shares Underlying the Options
The common shares of the Company shall be the underlying shares.
(4) After the Company grants options to an optionee, the Company shall
have the right to revoke and cancel unvested options in the event
that the optionee commits serious misconduct and violates the
employment contract or policies of the Company.
(5) Termination of Employment
If an optionee's employment with the Company is terminated, the
optionee shall exercise options in accordance with the following
provisions, subject to the ten-year limit set forth in Paragraph
5(2) above:
a. Voluntary Termination or Terminated for Cause by the
Company in Accordance with Labor Law of ROC -- Options vested
in accordance with the schedule set forth in Paragraph 5(2)
above shall be exercised within three (3) months from the
employment termination date. Unvested options shall become
invalid on the employment termination date.
b. Retirement -- All options granted are exercisable subject to
the Waiting Period, regardless of the vesting schedule set
forth in Paragraph 5(2) above. Nevertheless, the optionee
shall exercise all options within one (1) year from the later
of: (x) the date of retirement; or, (y) the end of the Waiting
Period.
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c. Temporarily on Leave Without Pay --
In case the optionee is approved to be temporarily on leave
without pay, vested options shall be exercised within three
(3) months from the effective date of the temporary leave;
otherwise, the right to exercise options shall be deferred
until the optionee's reinstatement. For unvested options, the
accumulation of years of employment with respect to the
vesting schedule set forth in Paragraph 5(2) above shall
suspend during the period of the optionee's temporary leave
and shall resume after the optionee's reinstatement, subject
to the ten-year limit set forth in Paragraph 5(2) above.
d. Death --
Options vested in accordance with the schedule set forth in
Paragraph 5(2) above shall be exercised by the optionee's
inheritor within one (1) year from the death of the optionee.
Unvested options shall expire and become invalid upon the
death of the optionee.
e. Death or Disability Caused by Work Injury --
(a) Regardless of the vesting schedule set forth in
Paragraph 5(2) above, all options granted are
exercisable upon the departure of the optionee from the
Company due to any disability caused by work injury,
subject only to the Waiting Period. Nevertheless, the
optionee shall exercise the options within one (1) year
from the later of: (x) the date of departure; or, (y)
the end of the Waiting Period.
(b) Regardless of the vesting schedule set forth in
Paragraph 5(2) above, all options granted are
exercisable by the optionee's inheritor upon the death
of the optionee, which is caused by work injury,
subject only to the Waiting Period. Nevertheless, the
inheritor shall exercise the options within one (1)
year from the later of: (x) the death of the optionee;
or, (y) the end of the Waiting Period.
f. Transfer to Affiliates --
In case the optionee is transferred to an affiliate due to the
necessity of the operations of the Company, the rights and
obligations of the options granted shall not be affected by
such transfer.
g. Severance/Layoff in Accordance with Labor Law of ROC --
Options vested in accordance with the schedule set forth in
Paragraph 5(2) above shall be exercised within three (3)
months from the effective date of the severance/layoff (other
than situations set forth in Paragraph
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5(5) a above). Unvested options shall become invalid upon the
effective date of the severance/layoff; or, may be exercised
in accordance with a schedule determined by the Chairman based
on the schedule set forth in Paragraph 5(2) above, which shall
be subsequently approved by the Compensation Committee of the
Board of Directors of the Company.
h. If the optionee or his/her inheritor is unable to exercise the
options within the periods set forth above, the unexercised
options shall expire and become invalid.
(6) Invalidated Options
Any invalidated options shall be cancelled.
6. UNDERLYING SHARES
The Company will issue new common shares of the Company as the underlying
shares.
7. ADJUSTMENTS OF THE EXERCISE PRICE
(1) The exercise price shall be subject to adjustment in accordance with
the following formula, to be rounded to the tenth, upon the
occurrence of changes in paid-in capital of the Company as a result
of capitalization of retained earnings or capital reserves.
NEP = OEP x [N/(N + n)]
Where: NEP = the exercise price after such adjustment
OEP = the exercise price before such adjustment
N = the number of outstanding common shares
(the number of treasury shares which have
not been transferred or cancelled shall be
deducted.)
n = the number of new common shares arising from
the capitalization of retained earnings or
capital reserves
The exercise price will not be adjusted in case of issuance of new common
shares in connection with mergers.
(2) The exercise price shall be subject to adjustment in accordance with
the following formula, to be rounded to the tenth, upon the
occurrence of capital reduction except where such reduction occurs
as a result of treasury stock cancellation.
NEP = OEP x [((M-C)/M) x (N/n)]
Where: NEP = the exercise price after such adjustment
OEP = the exercise price before such adjustment
M = the closing price as of the last trading day
before the capital reduction
C = the amount of cash distributed per common
share, if any
N = the number of outstanding common shares
before the capital reduction
n = the number of outstanding common shares
after the capital reduction
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8. ADJUSTMENTS OF NUMBER OF OPTIONS
(1) Upon the occurrence of the Company's capitalization of retained
earnings or capital reserves, in addition to adjusting the exercise
price in accordance with provisions set forth in Paragraph 7(1)
above, the Company will issue additional options in proportion to
the increase of paid-in capital (only integral options will be
issued and any fractional options resulting therefrom will be
disregarded) at the adjusted price to holders of existing unvested
or unexercised options, provided that there are sufficient common
shares reserved for granting the options as specified in the
Articles of Incorporation of the Company.
(2) Upon the occurrence of the Company's capital reduction except where
such reduction occurs as a result of treasury stock cancellation, in
addition to adjusting the exercise price in accordance with the
provisions set forth in Paragraph 7(2) above, the Company will
reduce existing unvested or unexercised options in proportion to the
increase of exercise price (any fractional options resulting
therefrom will be disregarded).
9. PROCEDURES FOR EXERCISING OPTIONS
(1) Except during a period in which the shareholders' book is closed in
accordance with relevant laws; or, the period from three (3)
business days prior to the date of public announcement to close
shareholders' book for stock dividends, cash dividends, or rights
offering filed by the Company with the Taiwan Stock Exchange
Corporation to the record date, optionee may exercise options in
accordance with the vesting schedule set forth in Paragraph 5(2)
above by submitting a written notice (the "Exercise Notice") to the
Company to purchase the newly issued common shares of the Company.
(2) The Company shall inform the optionee of the payment for exercising
the options to a designated bank upon the receipt of the Exercise
Notice. The Exercise Notice shall not be withdrawn once the payment
has been made.
(3) The transfer agent of the Company shall register the optionee and
his/her
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shares in the shareholders record upon the Company's confirmation of
the payment and shall book transfer common shares of the Company to
the optionee within five (5) business days. The common shares so
issued are tradable on the Taiwan Stock Exchange upon delivery to
the optionee.
(4) The Company shall file the change in the paid-in capital with the
relevant authority once each quarter.
10. RIGHTS AND OBLIGATIONS AFTER EXERCISING OPTIONS
The holders of common shares of the Company issued after options are
exercised shall have the same rights, obligations and privileges as
holders of common shares of the Company.
11. MISCELLANEOUS
(1) The Plan shall become effective upon obtaining approval from the
Board of Directors of the Company and the Authority. Prior to the
grant of options, any amendments to the Plan shall become effective
upon obtaining approval from the Board of Directors of the Company
and reporting such amendments to the Authority.
(2) Any other matters not set forth in the Plan shall be dealt with in
accordance with the applicable laws and regulations.
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