KEY TRONIC CORP
For the period ended Oct 28, 2024. Filed Oct 28, 2024.
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Oct 28, 2024 · Filed Oct 28, 2024
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Contents
Key Data
The following table includes information regarding our outstanding awards and shares of Common Stock available for future awards under the Prior Plan as of September 28, 2024:
| 2010 Incentive Plan | |
|---|---|
| Total shares of Common Stock underlying outstanding SARs | 136,250 |
| Total unvested SARs outstanding | 136,250 |
| Weighted average exercise price of outstanding SARs | $5.10 |
| Weighted average remaining contractual life of outstanding SARs | 2.8 years |
| Total shares of Common Stock available for grant | 1,018,265 (1) |
(1) These shares are no longer available for grant under the Prior Plan effective as of October 23, 2024.
In setting the number of proposed shares authorized for issuance under the 2024 Plan, the Compensation Committee and the Board considered a number of factors, including shares available under the Prior Plan, the “burn rate” or how long the shares available (assuming the approval by the shareholders of this proposal) are expected to last, historical equity award granting practices, impact of equity awards under the Prior Plan, and expected value transfer and dilution.
Our fully diluted overhang rate measures the total number of shares under all outstanding plan awards plus the number of shares authorized for future plan awards, as a percentage of the fully diluted number of shares of Common Stock outstanding. It measures the potential dilutive effect of outstanding equity awards and future awards available for grant. If the 2024 Plan is approved by our shareholders, as of September 28, 2024, our fully diluted overhang rate would be 13.89%, based on the number of shares of Common Stock outstanding.
| Overhang | |
|---|---|
| (a) Share reserve in 2024 Plan subject to shareholder approval | 1,600,000 |
| (b) Shares underlying awards outstanding under the Prior Plan | 136,250 |
| (c) Total shares, underlying or available for awards (a + b) | 1,736,250 |
| (d) Total shares of common stock outstanding | 10,761,871 |
| (e) Fully diluted overhang ((c/(c+d)) | 13.89% |
Our three-year average annual burn rate under the Prior Plan was 0.96% from fiscal 2022 to fiscal 2024. The following table shows our burn rate and dilution percentages over the past three years:
| Key Equity Metrics | 2022 | 2023 | 2024 |
|---|---|---|---|
| Burn Rate(1) | 1.53% | 1.35% | 0.00% |
| Dilution(2) | 7.05% | 5.82% | 3.60% |
(1)Burn rate is calculated by dividing the number of shares of Common Stock subject to awards granted during the fiscal year by the weighted average number of shares outstanding during the fiscal year.
(2)Dilution is calculated by dividing the number of shares of Common Stock subject to awards outstanding at the end of the fiscal year by the number of shares outstanding at the end of the fiscal year.
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