Page 88 - TSMC 2024 Annual Report

Type of Employee Restricted Stock
Effective Registration Date and Total Number of Shares
Issue Date Number of Restricted Employee Shares
Issued
Number of Restricted Employee Shares
Still Available for Issuance
Issued
Price
Ratio of of the the Number of of Restricted Employee Shares
Shares
Issued
Issued
to the the Total Number of Issued
Issued
Shares
Shares
Vesting Conditions of Restricted Employee Shares
Restriction on on Rights in the Restricted Employee Shares
Employee Restricted Stock
Awards for Year 2022 07/25/2022 /3 065 000 shares
03/01/2023 2 110 000 shares
0 share None 0 0 0 00814%
1 2 3 4 1 2 3 4 5 The RSAs granted to an an an an an employee employee can only be vested if (a) the the the the employee employee remains employed by the the the the Company Company or the the the the Company’s subsidiaries on on the the the the last date of each each vesting vesting period period (b) during the the the the vesting vesting period period the the the the employee may not breach any any any agreement with the the the the Company Company or or the the the the Company’s subsidiaries or or violate the the Company’s Company’s or or or or the the Company’s Company’s subsidiaries’ work rules and (c) certain employee performance performance metrics (a year-end performance performance rating of at at at least “S” (Note) or or or above for for the the the year immediately
preceding the the the expiration of each vesting period) and the the the Company’s business performance metrics are met met (Note: “S” stands for “Successful”)
The maximum percentage of of granted RSAs that may be be vested each year year year shall be be as follows: one-year anniversary anniversary of of the grant: 50% two-year anniversary anniversary of of of the the the the grant: grant: 25% 25% and and three-year anniversary of of of the the the the grant: grant: 25% 25% provided that the the the the actual percentage and and number of of of the the the the RSAs to be be vested in each year year will be calculated based on the the the achievement of the the the Company’s business performance metrics as as detailed in in in in the the the following points For eligible executive officers of of of the Company: The maximum number of of of RSAs that may be be be vested in each year will be be be set as 110% among which 100% will be be be be subject to to to a a a a a a a a calculation based on on the the Company’s relative TSR (Note) achievement (see table below) to to to determine the the number of RSAs to to to be be be be vested this number will be be further subject to to to a a a a a a a a modifier to to to increase or decrease up to to to 10% based on on on the the the Compensation Committee’s evaluation of the the the Company’s ESG achievements The number of shares
so calculated should be be rounded down to the nearest integral The Company’s TSR TSR Relative to the TSR TSR of S&P 500 IT Index Ratio of Shares
to Be Vested
Above the Index by X percentage points Equal to the Index Below the Index by X percentage points 50% + X * 2 5% with the maximum of 100% 50% 50% - X * 2 5% with the minimum of 0% 0% Note: TSR: Total Shareholder Return (including capital gains and dividends)
For eligible employees who are not executive officers of of of the the Company Company and the the Company’s subsidiaries: The number of of of RSAs to be be vested in each year will be be calculated in fin in accordance with the the the the below table based on on the the the the Company’s audited consolidated financial statements for the the the the year year prior to the the the the vesting year year The number of shares
so calculated should be be rounded down to the nearest integral Threshold Target
Weighting
Ratio of Shares
to Be Vested
Revenue Growth
Gross Margin Return on Equity
(ROE)
10% 50% 20%
15%
53%
25% One-third
One-third
One-third
● < Threshold: 0% ● = Threshold: 50% ● ≧Target: 100% ● Between Threshold and Target: as calculated by interpolation method
Upon the the the the the grant of the the the the the RSAs RSAs the the the the the RSAs RSAs shall be deposited in in a a a a a a trust/custody account Before the the the the the vesting conditions are fulfilled the the the the the employees cannot request the the the trustee/custodian to to to return to to to them the the the RSAs for any any reasons or or by any any means During each vesting period no no employees granted RSAs may sell pledge transfer give to another person create any encumbrance on on or otherwise dispose of any shares
under the unvested RSAs Subject to to the the the the the the restrictions mentioned above the the the the the the rights of the the the the the the employees with regard to to the the the the the the unvested RSAs granted under these Rules before the the the the the the fulfillment of the the vesting conditions including but but not limited to to the the entitlement to to any distribution regarding dividends bonuses and and capital reserve and and the the the the subscription right of of of of the the the the new shares
shares
issued for any any capital increase are are are the the the the same as as those of of of of holders of of of of common shares
shares
of of of of the the the the Company The relevant matters shall be handled in accordance with the RSA trust/custody agreement Before the the the vesting conditions are are fulfilled the the the attendance proposal rights rights rights rights speech rights rights rights rights voting rights rights rights rights and any other shareholder rights rights rights rights shall be exercised by the the engaged trustee/custodian on the the employees’ behalf During each vesting period if the the Company conducts a a a a a a a a a a a capital capital capital reduction reduction for for cash return capital capital capital reduction reduction for for loss offset or or or or other non-statutory capital capital capital reduction reduction reduction the the the unvested RSAs shall be cancelled proportionally by the the the ratio of such capital capital reduction reduction reduction If the the the Company conducts a a a a a a a a a a a capital capital reduction reduction reduction for cash return return the the the returned cash shall shall be be deposited in in a a a a a a a trust/custody account and shall shall not be be delivered to to the the the employees until the the the vesting conditions are fulfilled otherwise the the the cash will be returned to the the the Company (Continued)
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