As of April 6, 2021, we had 70,439,842 total Shares issued and
outstanding. In addition, as of April 6, 2021, we had 3,524,259 Shares subject to outstanding equity awards under the 2016 Plan and Prior Plans, 425,557 Shares available for future equity awards under the 2016 Plan and 6,500,000 additional
Shares proposed under the A&R 2016 Plan Share reserve (which results in a total of 10,449,816 Shares subject to outstanding awards and available for future issuance), representing a projected overhang percentage of approximately 12.9% on a fully
diluted basis. Of the 3,524,259 Shares subject to outstanding equity awards under the 2016 Plan and Prior Plans as of April 6, 2021, 2,409,683 Shares underlie full-value awards (restricted stock units and deferred stock units) and 1,114,576 Shares
underlie stock options. The weighted average exercise price of these outstanding stock options is $9.63 and the weighted average remaining term is 4.84 years.
Based on the closing price on Nasdaq for our Shares on April 6, 2021 of $12.24 per share, the aggregate market value as of
April 6, 2021 of the additional 6,500,000 Shares requested under the A&R 2016 Plan was $79,560,000.
Share Usage and Burn
Rate
Under the 2016 Plan, we granted awards representing approximately 1,068,942 Shares in 2020, 896,934 Shares in
2019 and 3,132,056 Shares in 2018, calculated on an adjusted basis based on our understanding of the methodology utilized by ISS. However, these amounts are not necessarily indicative of the Shares that may be granted over at least the next three
years under the A&R 2016 Plan.
Our average annual equity grant rate, or burn rate, under the 2016 Plan
over the three-year period ending December 31, 2020, calculated based on our understanding of the methodology used by ISS, was 2.44%, which was lower than ISS maximum burn rate guidance of 3.64% for our industry classification. The
three-year average burn rate is determined as (i) options granted, plus (ii) the adjusted amount of stock-settled restricted stock units and deferred stock units granted (using a 2x multiplier for each of these full value awards based on
our stock price volatility), divided by (iii) weighted average (basic) Shares outstanding of the applicable fiscal year. Our calculation of the burn rate under the 2016 Plan for the past three years is set forth in the following table:
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Time
Period
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Shares
Subject to
Options
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Shares
Subject to
Awards Other
than Options
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Total
Shares
Granted
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Total
Adjusted
Shares
Granted
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Weighted
Average Number
of Shares
Outstanding
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Burn
Rate (%)
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2020
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0
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534,471
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534,471
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1,068,942
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69,414,000
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1.54
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2019
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41,958
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427,488
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469,446
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896,934
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70,088,000
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1.28
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2018
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336,768
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1,397,644
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1,734,412
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3,132,056
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69,598,000
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4.50
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3-Year Average:
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2.44
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Based on our historic usage of Shares, we expect that the Share pool under the A&R 2016
Plan (including the requested additional Shares) will allow us to make awards to participants for the next six years. However, there can be no certainty as to the future use of Shares under the A&R 2016 Plan, as our stock price may affect the
rate at which Shares are utilized under the A&R 2016 Plan.
Changes in the A&R 2016 Plan
The A&R 2016 Plan (1) increases the number of Shares available for awards by 6,500,000 Shares to an overall limit of
10,700,000 Shares (subject to adjustment, including under the share counting rules, and the addition of Shares from forfeited and terminated awards under the Prior Plans), (2) places an express limit on shares that may be issued or transferred upon
the exercise of incentive stock options granted under the A&R 2016 Plan of 6,500,000 Shares, (3) provides that dividends and dividend equivalents accrued with respect to any awards (not just performance-based awards) are subject to the same
restrictions as the underlying award (and will be deferred until, and paid contingent upon, the vesting of such award), (4) removes terms, conditions, definitions and requirements relating to the qualified performance-based exception to
Section 162(m) of the Code, which exception is no longer available for new awards under the A&R 2016 Plan due to tax reform legislation, (5) makes share withholding to pay tax obligations the default (other than for options), unless
the Compensation Committee specifically approves otherwise and (6) reflects certain other technical revisions in response to changes in the law and other clarifying changes.
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