The Board of Directors of Ni Hsin wishes to announce that the Company proposes to undertake the proposed termination of the ESOS (“Proposed Termination”).
DETAILS OF THE PROPOSAL
Ni Hsin had, on 13 June 2016, established an ESOS of up to fifteen percent (15%) of the issued and paid-up share capital to all eligible employees of the Ni Hsin Group for a period of 5 years. The ESOS will expire on 12 June 2021.
The Company proposes to terminate the Existing ESOS in accordance with By-Law 5.6 of the ESOS, which states that the Company has the right to terminate the existing ESOS at any time provided that it has obtained:
(i) the consent of its shareholders at a general meeting, wherein at least a majority of the shareholders present and voting thereat, voted in favour of the termination; and
(ii) the written consent of all the grantees under the existing ESOS who have yet to exercise their options, either in part or in whole.
As at 21 November 2017, the Company has granted 32,500,000 options under the existing ESOS, whereby none of the options have yet to be exercised and therefore, there are no shares vested.
The ESOS Committee, after due consideration, has proposed to terminate the existing ESOS due to the passing of Mr. Chen Shien Yee, the former Managing Director of Ni Hsin, who has been granted a total of 18,440,000 options pursuant to the ESOS on 13 June 2016 and 22 December 2016.
The Proposed Termination will not have any effect on the share capital and shareholdings of the substantial shareholders of Ni Hsin and consolidated net assets and gearing of the Company.
Upon the establishment of the ESOS, a Share Option Reserve amounting to RM5.034 million was created in recognition of the ESOS fair value which was computed based on the Binomial Option Pricing Model. Hence, the Proposed Termination will have the following effect on Ni Hsin’s earnings and basic earnings per Ni Hsin Share due to the cancellation of the Share Option Reserve:
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As at 31 December 2016
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Upon Termination of ESOS
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Profit/(Loss) after tax (RM’000)
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(4,914)
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120
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Basic earnings per share (sen)
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(2.25)
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0.05
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The Proposed Termination shall be effective upon obtaining the approval of the shareholders at a general meeting.
This announcement is dated 28 November 2017.