ESR AR 2019 EN

Notes to the Consolidated Financial Statements 31 December 2019 218 Focused 42. SHARE OPTION PLAN The Company operates share option plans (the “Plans”) for the purpose of providing incentives and rewards to eligible participants who contribute to the success of the Group’s operations. Eligible participants of the Plans include the Company’s shareholders, directors, senior management and other eligible participants. (a) Tier 1 ESOP Tier 1 ESOP is intended to provide the Company with a flexible means of retaining incentivizing, rewarding, remunerating, compensating and/or providing benefits to selected participants. By aligning the interests of selected participants with those of the shareholders, participants will be encouraged and motivated to continue their efforts towards enhancing the value of the Company. Eligible participants of Tier 1 ESOP include 3 selected participants. No further options will be issued under the Tier 1 ESOP. The exercise price of Tier 1 ESOP is USD0.46 per option. Tier 1 ESOP became effective on 20 April 2017 and will remain in force until 20 January 2021. (b) KM ESOP KMESOP is to incentivise or reward eligible participants for their contribution towards the Company’s operation, so as to: (a) motivate and encourage recipients to continue to performwell; (b) to retain the services of recipients whose work is vital to the growth and continued success of the Company; and (c) to link the personal interests of members of the Board and the employees with those of the shareholders. Eligible participants of KM ESOP include any director or employee of the Group, or any director or employee of any company which is under the control the Company. KM ESOP became effective on 24 November 2017 and, unless otherwise canceled or amended, will remain in force for 10 years from that date. The maximum number of shares which may be issued upon exercise of all options to be granted under the KM ESOP is 63,558,343. No further options will be issued under the KM ESOP. (c) Post-IPO share option scheme Post-IPO share option scheme is to provide incentives to participants to contribute to the Company and to enable the Company to recruit high caliber employees and attract or retain human resources that are valuable to the Group. Eligible participants of Post-IPO share option scheme include any individual, being and employee, executive director and non-executive director (including independent non-executive director), agent or consultant of the Company or its subsidiary who the Board or its delegate(s) consider, in their sole discretion, to have contributed or will contribute to the Group. Post-IPO Share Option Scheme became effective on 12 October 2019 and, unless otherwise canceled or amended, will remain in force for 10 years from that date. The maximum number of shares which may be issued upon exercise of all options to be granted under the Post-IPO share option scheme is 303,658,464. According to Post-IPO Share Option Scheme, the Board may, at its discretion, grant to any eligible participants an option at the exercise price over the whole number of shares it decides. The Board will decide the exercise price which will be stated at the date of grant. Share options granted to a director, chief executive or substantial shareholder of the Company, or to any of their associates, must first be approved by the independent non-executive directors, excluding any independent non-executive director who is a proposed recipient of the grant of options.