Before / after on overhang, runway, dilution, and investor concerns.

1. Step 1

   Snapshot the current plan

   Pull shares outstanding, awards outstanding, available reserve, and recent annual burn from the stock administration platform + cap table.

2. Step 2

   Define the proposal

   Additional shares, evergreen yes/no, repricing posture, share recycling rules. Each dial is a deliberate plan-design choice with investor-facing implications.

3. Step 3

   Walk before / after

   Compare overhang, runway, and dilution. Read the forecast walk to see how reserve runs over the company's hiring growth scenario.

4. Step 4

   Triage flags

   Investor concern flags surface high evergreen, large overhang increment, repricing without shareholder approval, asymmetric recycling, very short or very long runway.

5. Step 5

   Hand off

   Comp committee → legal (listing rules) → finance (dilution + budget) → accounting (ASC 718 expense) → IR for the proxy narrative.

# Plan amendment impact — board / comp committee memo

Educational diagnostic. ISS-aware framing, not an ISS / Glass Lewis score. Not legal, accounting, or financial advice. The plan document, listing-rule restrictions (NYSE / Nasdaq), shareholder approval requirements, and the comp committee charter control any actual amendment. Bring this memo to TR, finance, accounting, legal, and the comp committee for review before any action.

## 1. Inputs and assumptions
- Shares outstanding: 120,000,000
- Awards outstanding (vested + unvested): 9,500,000
- Available reserve: 3,500,000
- Annual burn (shares granted): 3,200,000
- Forecast horizon: 5 years
- Hiring growth multiplier: 1.10 per year

- Proposed additional reserve shares: 8,000,000
- Evergreen: not enabled
- Repricing allowed under plan: no; requires shareholder approval: yes
- Share recycling — full-value: Forfeit only; options: Forfeit only

## 2. Before vs after snapshot

| Metric | Before | After | Δ |
| --- | --- | --- | --- |
| Overhang | 10.83% | 17.50% | 6.67 pp |
| Runway (years) | 1.09 | 3.59 | 2.50 yrs |
| Annual burn | 2.67% | 2.67% | — |
| Additional dilution from amendment | — | — | 6.67% |

## 3. Forecast walk

| Year | Outstanding (start) | Reserve (start, after evergreen) | Annual burn | Reserve (end) | Cumulative dilution |
| --- | --- | --- | --- | --- | --- |
| 1 | 120,000,000 | 11,500,000 | 3,200,000 | 8,300,000 | 2.67% |
| 2 | 120,000,000 | 8,300,000 | 3,520,000 | 4,780,000 | 5.60% |
| 3 | 120,000,000 | 4,780,000 | 3,872,000 | 908,000 | 8.83% |
| 4 | 120,000,000 | 908,000 | 4,259,200 | 0 | 12.38% |
| 5 | 120,000,000 | 0 | 4,685,120 | 0 | 16.28% |

## 4. Investor concern flags
- **High overhang increment**: Amendment increases overhang by 6.67 percentage points (from 10.83% to 17.50%). A jump of 5pp+ typically triggers detailed investor review.

## 5. Legal and finance question list
- **Listing rule check.** Does the proposed amendment require shareholder approval under NYSE Listed Company Manual Rule 303A.08 or Nasdaq Listing Rule 5635(c)? Confirm with outside counsel.
- **ISS posture.** Does the proposed amendment fall inside the ISS Equity Plan Scorecard 'pass' range for the company's stage? Pull the latest ISS U.S. policy guidance.
- **Glass Lewis posture.** Does the amendment trigger any Glass Lewis red flags (high cost, repricing without approval, evergreen)?
- **ASC 718 expense impact.** What is the incremental fair-value expense from the amendment under the company's accounting policy? Pair with the ASC 718 Expense Forecaster in the workbench.
- **Plan doc consistency.** Does the proposed amendment require updating the plan-document share reserve language, individual-grant limits, or country-specific sub-plans?
- **Disclosure timeline.** Confirm the proxy-disclosure timeline and the comp committee charter language that supports the amendment.

## 6. Recommended next steps
1. **Comp committee.** Walk the before / after snapshot and the investor concern flags with the comp committee. Confirm the size of the request against the company's 3–5 year hiring plan.
2. **Legal.** Confirm listing-rule + plan-doc + sub-plan implications. Document the rationale for any deviation from prior amendment language.
3. **Finance.** Reconcile the dilution forecast to the FY budget and the burn-rate model. Confirm investor-relations talking points.
4. **Accounting.** Pair this memo with the ASC 718 expense forecast for the post-amendment award population.
5. **TR.** Stress-test runway under the hiring growth multiplier; consider scenario sensitivity on +/- 25% headcount growth.

## Disclaimer
Outputs reflect the inputs and thresholds typed above. Investor concern flags use practitioner-common reference points and are not a substitute for ISS / Glass Lewis modeling. Repricing, listing-rule, and shareholder-approval analysis is jurisdiction-specific; confirm with qualified counsel.