19. LONG-TERM OBLIGATIONS AND PROVISIONS (CONTINUED) (b) Provision for employee benefits During the financial period, a subsidiary of the Group implemented a Employees’ Share Appreciation Rights (“SAR” or “Program”) commencing from 1 August 2022 (“Commencement Date”) which will grant eligible employees and director rights to hold SAR shares in Silterra Malaysia Sdn. Bhd. (“Subsidiary”). The program shall be in force for a period of five (5) years from the Commencement Date. The salient features of the SAR based on its by-laws are as follows: (i) The maximum unit of SAR available under the Program is 240,267,436 units of SAR at any point in time when a grant is made throughout the duration of the Program. The Program shall be in force for a period of five (5) years commencing from 1 August 2022. (ii) The eligibility criteria include amongst others:- employees who are employed by the Subsidiary for a period not less than twelve (12) calendar months consecutively and directors that have not served a notice to resign or received a notice of removal. However, the Subsidiary Board may determine any other eligibility criteria and/or waive any of the conditions of eligibility for purposes of selecting an eligible person at any time and from time to time, in the Subsidiary Board’s discretion. (iii) The aggregate unit of SAR to be granted to an eligible person shall be determined at the sole and absolute discretion of the Subsidiary Board after taking into consideration, amongst other factors, the performance during appraisal period, and such other factors that the Subsidiary Board may deem relevant in its discretion. (iv) The grant price for each unit of the SAR shall be determined by the Subsidiary Board based on calculated fair market value at the grant date. (v) The SAR granted shall vest on the grantee on the anniversary of grant date over four years period. On each anniversary, 25% of the granted SAR Unit shall vest. (vi) The vested SAR is exercisable in whole during the lifetime by the grantee within the SAR period. The vested SAR can be exercised at any time so long as the employees remains in service in the Subsidiary and so long as the director has not served a notice to resign or received a notice of removal. (vii) Upon exercise: a) If it is feasible for the Subsidiary to issue new shares and that the Subsidiary has obtained the relevant approval from the relevant governmental authority for the Subsidiary to issue new shares, the Subsidiary shall issue in physical or electronic form of the share certificate for the relevant number of the SAR shares. The SAR shares are new irredeemable convertible preference share(s) of the Subsidiary which are to be issued pursuant to the By-Laws. b) If it is not feasible, Subsidiary shall deliver a non-transferable certificate Subsidiary to exchange each SAR unit stated in the Entitlement Certificate shares (“EC SAR”). Financial Statements DAGANG NeXCHANGE BERHAD 260 NOTES TO THE FINANCIAL STATEMENTS
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