Company: VCYT
Filing Date: 2025-04-29
Form Type: DEF 14A
Source: 0001384101-25-000051
Chunk: 30

Company: VERACYTE, INC.
Filing Date: 2025-04-29
Form: DEF 14A
Chunk 30
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If the Plan Amendment is not approved, we may have insufficient shares available to continue to make equity grants to our employees and non-employee directors and may be forced to rely more heavily on cash compensation, both in the short-term and mid-term, to provide the market-competitive total compensation necessary to attract and retain critical talent. This increased reliance on cash compensation could reduce funds available for growth and development, demotivate employees and reduce the alignment between employees and stockholders.

#### 30Veracyte2025 Proxy Statement

#### Proposal Five
We Carefully Consider and Forecast Our Need for Shares

As of March 31, 2025, there were 8,076,382 shares of common stock available for grant under the 2023 Plan. After carefully forecasting our anticipated growth rate for the next few years and considering our historical usage and forfeiture rates, we currently believe that the proposed Plan Amendment to increase the share reserve under the 2023 Plan by 2,500,000 shares of common stock will be sufficient for us to make anticipated grants of equity incentive awards under our current compensation program for approximately one additional year. However, a change in business conditions, company strategy, forfeiture rates or equity market performance could alter this projection up or down.

In evaluating the number of shares requested pursuant to the Plan Amendment, our Compensation Committee considered a number of factors, including the costs of the share request as well as an analysis of certain burn rate and dilution metrics as summarized below.

#### Grant Practices
During the past three fiscal years, we granted equity awards under our 2023 Plan and our 2013 Stock Incentive Plan (the “2013 Plan”), which terminated in connection with the approval of our 2023 Plan, as summarized in the chart below. Our three-year average burn rate was approximately 3.41% for fiscal years 2022 through 2024 (see chart below for a calculation of our three-year burn rate). We define “burn rate” as the number of time-based equity awards granted during the year plus performance-based equity awards granted during the year, assuming target-level achievement, divided by the weighted average total number of shares of common stock outstanding. We believe that our use of equity compensation, across the company, is a strong compensation differentiator that allows us to attract and retain talent at all levels in the company. This also reflects our commitment to a culture of ownership and accountability, to align with all stockholders. Our gross burn rate is aligned with common market practices across the life sciences sector where