EMPLOYEE STOCK PURCHASE PLANS

EMPLOYEE STOCK PURCHASE PLANS: EMPLOYMENT

Labor Concerns

Employees should acknowledge that the offer of purchase rights does not create a right or entitlement to further grants.

There is generally no requirement to inform and/or consult with local employee representatives (e.g. trade unions) prior to implementing a Plan in Singapore unless the employer has entered into a collective bargaining agreement with a trade union in Singapore which obliges the employer to do so.

Communications

There is no legal requirement for the Plan documents to be in a particular language. However, as English is the working language in Singapore, it is recommended that all information pertaining to the Plan is made available in English.

EMPLOYEE STOCK PURCHASE PLANS: REGULATORY

Securities Compliance

An exemption from the prospectus requirements is generally available if: (i) the securities are offered to employees of either the Issuer or a related corporation of the Issuer pursuant to a Plan, (ii) the securities are held by or for the benefit of such employees, (iii) the securities are the securities of the Issuer or its related parties; and (iv) no selling or promotional expenses are paid or incurred in connection with the offer other than certain permitted professional fees or commission.

Foreign Exchange

There are no foreign exchange restrictions applicable to the employee stock purchase plans.

Data Protection

The Personal Data Protection Act (Act 26 of 2012) ("PDPA") relates to all personal data which identifies an individual, whether electronic or non-electronic. Examples of data which may be considered personal data under the PDPA include video footage, telephone numbers and email addresses.

Broadly speaking, under the PDPA, an organisation will only be able to collect, use or disclose personal data:

(i) with the individual's consent, or where consent has been deemed to be given under the PDPA; and

(ii) for a reasonable purpose which the organisation has disclosed to the individual prior to the collection of that individual's personal data.

The PDPA imposes a number of strict obligations on corporate entities which relate, amongst a number of matters, to (i) the accuracy of data collected, (ii) the protection of data from unauthorised access, and (iii) the retention and release of documents. Under the PDPA, individuals also have a right to access their own personal data and obtain information about the way in which such data may be used or disclosed.Breach of the provisions set in out in the PDPA can give rise to significant penalties and other sanctions.As such, it is recommended that specialist advice is sought when considering the implementation and operation of a Plan in Singapore.

EMPLOYEE STOCK PURCHASE PLANS: TAX

Employee Tax Treatment

The employee will generally be subject to income tax on the purchase rights upon vesting. In the event there are disposal restrictions on the Stock acquired, tax is payable when such restrictions lapse. The taxable amount is the fair market value of the Stock at such time less any amount paid for the Stock. There is generally no tax on the subsequent sale of the underlying Stock, unless the employee is regarded as trading or dealing in securities.

Social Insurance Contributions

The offer of purchase rights should not be subject to contributions to the Central Provident Fund, unless such awards are cash-settled.

Tax Favored Program

Singapore has certain schemes pursuant to which employees may receive a partial tax exemption or deferral of taxation (subject to an interest charge) with respect to gains derived from Plans where certain conditions are met. Following the Singapore Budget Statement 2013, it was announced that the partial tax exemption scheme will expire with effect from 1 January 2014. Gains arising from awards granted on or before 31 December 2013 can continue to qualify, as long as the gains are derived on or before 31 December 2023.

Withholding and Reporting

Benefits paid to employees pursuant to a Plan are generally not subject to income tax withholding, except where tax clearance procedures are required in respect of employees who are leaving the employment of the local employer and who are (i) neither Singapore Citizens nor Singapore Permanent Residents; or (ii) Singapore Permanent Residents leaving Singapore permanently. Certain "deemed vesting / exercise" rules also apply to such employees, where any acquisition rights would be deemed to vest (and any disposal restrictions deemed to cease) one month prior to cessation of employment or the date the acquisition rights are granted (whichever is the later), and such employees would then be taxed at such time with respect to the acquisition rights granted.

The local employer also has certain tax reporting obligations.

Employer Tax Treatment

A deduction is generally not allowed for expenses incurred in respect of any right or benefit to acquire shares (other than treasury shares where certain conditions are met) of the employer's holding company.

Tax Rates

Income tax is charged at rates of up to 22%.

Employers and employees are required to contribute to the Central Provident Fund in respect of "wages" paid to the employees who are Singapore citizens or permanent residents. Assuming that the employee's total wages are above S$750 per calendar month, the applicable contribution rates (covering both employer and employee contribution components) range from 12.5% to 37% of the employee's wages for the month, out of which the employee contribution component ranges from 5% to 20% (usually through a deduction from the employee's monthly wages). The contribution rate is subject to an income ceiling of S$6,000. The applicable rates depend on whether the employee is a Singapore citizen or a permanent resident, and age group.

RESTRICTED STOCK and RSUs

RESTRICTED STOCK and RSUs: EMPLOYMENT

Labor Concerns

Employees should acknowledge that the offer of acquisitions rights does not create a right or entitlement to further grants.

There is generally no requirement to inform and/or consult with local employee representatives (e.g. trade unions) prior to implementing a Plan in Singapore unless the employer has entered into a collective bargaining agreement with a trade union in Singapore which obliges the employer to do so.

Communications

There is no legal requirement for the Plan documents to be in a particular language. However, as English is the working language in Singapore, it is recommended that all information pertaining to the Plan is made available in English.

RESTRICTED STOCK and RSUs: REGULATORY

Securities Compliance

An exemption from the prospectus requirements is generally available if: (i) the securities are offered to employees of either the Issuer or a related corporation of the Issuer pursuant to a Plan, (ii) the securities are held by or for the benefit of such employees, (iii) the securities are the securities of the Issuer or its related parties; and (iv) no selling or promotional expenses are paid or incurred in connection with the offer other than certain permitted professional fees or commission.

Foreign Exchange

There are no foreign exchange restrictions applicable to the restricted stock plans.

Data Protection

The Personal Data Protection Act (Act 26 of 2012) ("PDPA") relates to all personal data which identifies an individual, whether electronic or non-electronic. Examples of data which may be considered personal data under the PDPA include video footage, telephone numbers and email addresses.

Broadly speaking, under the PDPA, an organisation will only be able to collect, use or disclose personal data:

(i) with the individual's consent, or where the consent has been deemed to be given under the PDPA; and

(ii) for a reasonable purpose which the organisation has disclosed to the individual prior to the collection of that individual's personal data.

The PDPA imposes a number of strict obligations on corporate entities which relate, amongst a number of matters, to (i) the accuracy of data collected, (ii) the protection of data from unauthorised access, and (iii) the retention and release of documents. Under the PDPA, individuals also have a right to access their own personal data and obtain information about the way in which such data may be used or disclosed.Breach of the provisions set in out in the PDPA can give rise to significant penalties and other sanctions.As such, it is recommended that specialist advice is sought when considering the implementation and operation of a Plan in Singapore.

RESTRICTED STOCK and RSUs: TAX

Employee Tax Treatment

Employees will generally be subject to income tax on RSUs and restricted stock upon vesting. In the event there are disposal restrictions on the Stock acquired, tax is payable when such restrictions lapse. The taxable amount is the fair market value of the Stock at such time less any amount paid for the Stock. There is generally no tax on the subsequent sale of the underlying Stock, unless the employee is regarded as trading or dealing in securities.

Social Insurance Contributions

The award of restricted stock or RSUs should not be subject to contributions to the Central Provident Fund, unless such awards are cash-settled.

Tax Favored Program

Singapore has certain schemes pursuant to which employees may receive a partial tax exemption or deferral of taxation (subject to an interest charge) with respect to gains derived from Plans where certain conditions are met. Following the Singapore Budget Statement 2013, it was announced that the partial tax exemption scheme will expire with effect from 1 January 2014. Gains arising from RSUs and restricted stock granted on or before 31 December 2013 can continue to qualify, as long as the gains are derived on or before 31 December 2023.

Withholding and Reporting

Benefits paid to employees pursuant to a Plan are generally not subject to income tax withholding, except where tax clearance procedures are required in respect of employees who are leaving the employment of the local employer and who are (i) neither Singapore Citizens nor Singapore Permanent Residents; or (ii) Singapore Permanent Residents leaving Singapore permanently. Certain "deemed vesting / exercise" rules also apply to such employees, where any acquisitions rights would be deemed to vest (and any disposal restrictions deemed to cease) one month prior to cessation of employment or the date the acquisitions rights are granted (whichever is the later), and such employees would then be taxed at such time with respect to the acquisitions rights granted.

The local employer also has certain tax reporting obligations.

Employer Tax Treatment

A deduction is not allowed for expenses incurred in respect of any right or benefit to acquire shares (other than treasury shares where certain conditions are met) of the employer's holding company.

Tax Rates

Income tax is charged at rates of up to 22%.

Employers and employees are required to contribute to the Central Provident Fund in respect of "wages" paid to the employees who are Singapore citizens or permanent residents. Assuming that the employee's total wages are above S$750 per calendar month, the applicable contribution rates (covering both employer and employee contribution components) range from 12.5% to 37% of the employee's wages for the month, out of which the employee contribution component ranges from 5% to 20% (usually made through a deduction from the employee's monthly wages). The contribution rate is subject to an income ceiling of S$6,000. The applicable rates depend on whether the employee is a Singapore citizen or a permanent resident, and their age group.

STOCK OPTIONS PLANS

STOCK OPTIONS PLANS: EMPLOYMENT

Labor Concerns

Employees should acknowledge that the offer of options does not create a right or entitlement to further grants.

There is generally no requirement to inform and/or consult with local employee representatives (e.g. trade unions) prior to implementing a Plan in Singapore unless the employer has entered into a collective bargaining agreement with a trade union in Singapore which obliges the employer to do so.

Communications

There is no legal requirement for the Plan documents to be in a particular language. However, as English is the working language in Singapore, it is recommended that all information pertaining to the Plan is made available in English.

STOCK OPTIONS PLANS: REGULATORY

Securities Compliance

An exemption from the prospectus requirements is generally available if: (i) the securities are offered to employees of either the Issuer or a related corporation of the Issuer pursuant to a Plan, (ii) the securities are held by or for the benefit of such employees, (iii) the securities are the securities of the Issuer or its related parties; and (iv) no selling or promotional expenses are paid or incurred in connection with the offer other than certain permitted professional fees or commission.

Foreign Exchange

There are no foreign exchange restrictions applicable to the stock option plans.

Data Protection

The Personal Data Protection Act (Act 26 of 2012) ("PDPA") relates to all personal data which identifies an individual, whether electronic or non-electronic. Examples of data which may be considered personal data under the PDPA include video footage, telephone numbers and email addresses.

Broadly speaking, under the PDPA, an organisation will only be able to collect, use or disclose personal data:

(i) with the individual's consent, or where consent has been deemed to be given under the PDPA; and

(ii) for a reasonable purpose which the organisation has disclosed to the individual prior to the collection of that individual's personal data.

The PDPA imposes a number of strict obligations on corporate entities which relate, amongst a number of matters, to (i) the accuracy of data collected, (ii) the protection of data from unauthorised access, and (iii) the retention and release of documents. Under the PDPA, individuals also have a right to access their own personal data and obtain information about the way in which such data may be used or disclosed. Breach of the provisions set in out in the PDPA can give rise to significant penalties and other sanctions. As such, it is recommended that specialist advice is sought when considering the implementation and operation of a Plan in Singapore.

STOCK OPTIONS PLANS: TAX

Employee Tax Treatment

The employee will generally be subject to income tax upon exercise of the options. In the event there are disposal restrictions on the Stock acquired, tax is payable when such restrictions lapse. The taxable amount is the fair market value of the Stock at such time less any amount paid for the Stock. There is generally no tax on the subsequent sale of the underlying Stock, unless the employee is regarded as trading or dealing in securities.

Social Insurance Contributions

The offer of employee share options should not be subject to contributions to the Central Provident Fund, unless such awards are cash-settled.

Tax Favored Program

Singapore has certain schemes pursuant to which employees may receive a partial tax exemption or deferral of taxation (subject to an interest charge) with respect to gains derived from Plans where certain conditions are met. Following the Singapore Budget Statement 2013, it was announced that the partial tax exemption scheme will expire with effect from 1 January 2014. Gains arising from stock options granted on or before 31 December 2013 can continue to qualify, as long as the gains are derived on or before 31 December 2023.

Withholding and Reporting

Benefits paid to employees pursuant to a Plan are generally not subject to income tax withholding, except where tax clearance procedures are required in respect of employees who are leaving the employment of the local employer and who are (i) neither Singapore Citizens nor Singapore Permanent Residents; or (ii) Singapore Permanent Residents leaving Singapore permanently. Certain "deemed vesting / exercise" rules also apply to such employees, where any options would be deemed exercised (and any disposal restrictions deemed to cease) one month prior to cessation of employment or the date the purchase rights are granted (whichever is the later), and such employees would then be taxed at such time with respect to the options granted.

The local employer also has certain tax reporting obligations.

Employer Tax Treatment

A deduction is not allowed for expenses incurred in respect of any right or benefit to acquire shares (other than treasury shares where certain conditions are met) of the employer's holding company.

Tax Rates

Income tax is charged at rates of up to 22%.

Employers and employees are required to contribute to the Central Provident Fund in respect of "wages" paid to the employees who are Singapore citizens or permanent residents. Assuming that the employee's total wages are above S$750 per calendar month, the applicable contribution rates (covering both employer and employee contribution components) range from 12.5% to 37% of the employee's wages for the month, out of which the employee contribution component ranges from 5% to 20% (usually through a deduction from the employee's monthly wages). The contribution rate is subject to an income ceiling of S$6,000. The applicable rates depend on whether the employee is a Singapore citizen or a permanent resident, and age group.