Samsung Electronics: "PSU Introduction Not Intended to Avoid Treasury Share Cancellation"

Refutes Allegations via Internal Notice
"PSU Will Be Funded from Previously Announced 1.6 Trillion Won"
"No Plans to Issue New Shares for Employee Compensation"

Samsung Electronics has refuted claims that its newly introduced Performance Share Unit (PSU) program is a scheme to avoid canceling treasury shares, calling such allegations "groundless."

On October 16, Samsung Electronics announced via its internal bulletin board, "The rumor that we introduced the PSU program as a means to circumvent the obligation to cancel treasury shares under the amended Commercial Act is not true."

Samsung Electronics Seocho Building. Photo by Kang Jinhyung

On October 14, immediately after announcing its preliminary third-quarter results, Samsung Electronics revealed plans to implement the PSU program, which will grant treasury shares to employees based on the increase in the company’s stock price over the next three years.

Some have raised suspicions that this compensation policy was designed to avoid canceling treasury shares held by Samsung Electronics by distributing them to employees. The third amendment to the Commercial Act, currently being promoted by the political sector, mandates the cancellation of treasury shares but allows exceptions for employee compensation. Critics allege that Samsung Electronics introduced the PSU program to take advantage of this exception.

Samsung Electronics maintains that these claims are completely unfounded. From November last year to September this year, the company repurchased a total of 10 trillion won in treasury shares, of which 1.6 trillion won worth was already publicly designated for employee compensation. The company clarified that the PSU program will be funded solely from this 1.6 trillion won previously earmarked for employee rewards.

Samsung Electronics emphasized, "This program was established to expand the scale of compensation in line with stock price increases, thereby sharing growth value between employees and the company." The company also stated that it has no plans to issue new shares for employee stock compensation, and if the funds from stock price appreciation are insufficient, it will purchase additional treasury shares as needed.

Meanwhile, through the PSU program, Samsung Electronics plans to grant 200 shares to employees at CL 1-2 and 300 shares to employees at CL 3-4, with agreements to be made within this month. The final number of shares to be distributed will be determined by the increase in stock price over three years, and the shares will be distributed in equal installments over a three-year period starting in 2028.

The payout multiplier based on the stock price increase will be determined by comparing the share price on October 15, 2025, with the price on October 13, 2028: ▲ less than 20% increase, 0 times; ▲ 20-40% increase, 0.5 times; ▲ 40-60% increase, 1 time; ▲ 60-80% increase, 1.3 times; ▲ 80-100% increase, 1.7 times; ▲ 100% or more, 2 times.