Company: REI
Filing Date: 2025-04-11
Form Type: DEF 14A
Source: 0001628280-25-017570
Chunk: 81

Company: RING ENERGY, INC.
Filing Date: 2025-04-11
Form: DEF 14A
Chunk 81
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 and employees. If stockholders do not approve the proposed increase in shares authorized under the 2021 Plan, the Company likely will be precluded from successfully attracting and retaining the best possible talent to move its business forward.

For these reasons, we are asking our stockholders to approve the additional shares authorized for issuance under the Plan Amendment and thereby enable us to continue to implement our long-term equity compensation program.

### HISTORICAL EQUITY AWARD GRANTING PRACTICES
We also considered both our total equity “overhang” and our historical and projected annual “burn rate” in developing our share increase to the 2021 Plan and analyzing the impact of using equity as a means of compensation on our stockholders.

Overhang is calculated by dividing the number of shares issuable pursuant to outstanding equity awards plus the number of shares remaining available for awards under the 2021 Plan, by the number of shares of Common Stock outstanding. As of March 10, 2025, our overhang percentage was 4% (calculated as 7,482,428 shares issuable pursuant to outstanding equity awards plus 1,625,756 shares remaining available for awards under the 2021 Plan, divided by the shares of Common Stock outstanding as of the record date of 206,509,126. With the addition of the proposed shares of 11.5 million, our total potential dilution rate increases by 6%.

Burn rate provides a measure of the potential dilutive impact of our equity award program which we calculate by dividing the number of shares subject to equity awards granted during the year by the basic weighted average

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#### RING ENERGY
number of shares outstanding. In proposing the number of shares authorized for issuance under the 2021 Plan, we considered the number of equity awards granted under the 2021 Plan in the past three fiscal years. In the past three years, the Company granted equity awards representing a total of approximately 8,831,583 shares, with a three-year average annual burn rate of 1.73% as follows:

|                                                      | For the years ended |     | December 31, 2024 |       |     | December 31, 2023 |       |     | December 31, 2022 |       |
|:-----------------------------------------------------|:--------------------|:----|------------------:|:------|:----|------------------:|:------|:----|------------------:|:------|
| Restricted stock units (RSUs)