Company: AOSL
Filing Date: 2025-09-18
Form Type: DEF 14A
Source: 0001387467-25-000054
Chunk: 41

Company: ALPHA & OMEGA SEMICONDUCTOR Ltd
Filing Date: 2025-09-18
Form: DEF 14A
Chunk 41
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1,106,650 shares. Although the number of shares required for our annual grants and other grants varies based on a number of factors, including our share price at the time of the grant and the size of individual grants awarded by our Compensation Committee, we do not believe that we have sufficient shares available under the 2018 Plan for our annual grants and other grants in fiscal year 2026 (the majority of which will be made during the first quarter of calendar year 2026) and beyond. Approval of this proposal is critical to sustaining our momentum as we build shareholder value. In this regard, our Board believes that if this proposal is not approved, we may be at a disadvantage against our competitors for recruiting, retaining and motivating individuals critical to our success and we could be forced to increase cash compensation to provide a market-competitive total compensation package necessary to attract, retain, and motivate the talent critical to our future successes. We do not believe this would be in our best interests or the best interests of our shareholders because these additional cash payments would, among other things, reduce resources available to meet our business needs and cause a loss of motivation by employees to achieve superior performance over a longer period of time. Equity-based incentives, by contrast, directly align a portion of the compensation of our service providers with the economic interests of our shareholders and meet the expected industry recruiting standards needed to enable us to attract, retain and motivate employees.

We are asking our shareholders to approve the amendment and restatement of the 2018 Plan in order to (i) meet NASDAQ listing requirements, (ii) allow incentive stock options awarded under the 2018 Equity Incentive Plan to meet the requirements of the Internal Revenue Code of 1986, as amended, and the regulations promulgated thereunder and (iii) conform to good corporate governance.

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#### Plan Background
Our Board adopted the 2018 Plan on October 3, 2018 and our shareholders approved the 2018 Plan on November 8, 2018 (the “Plan Effective Date”). Our shareholders have subsequently approved increases to the share reserve under the 2018 Plan (at annual general meetings of our shareholders) as follows: 800,000 shares in 2019; 1,000,000 shares in 2021; 740,000 shares in 2022; 427,000 shares in 2023, and 377,000 shares in 2024.

The 2018 Plan is the only discretionary