Company: ALGN
Filing Date: 2025-03-27
Form Type: PRE 14A
Source: 0001097149-25-000016
Chunk: 94

Company: ALIGN TECHNOLOGY INC
Filing Date: 2025-03-27
Form: PRE 14A
Chunk 94
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 conserve the remaining share reserve, which would impact the mix of compensation elements used. See “Executive Compensation—Compensation Discussion and Analysis.” In order to enable us to continue offering meaningful equity-based incentives, our Board believes it is both necessary and appropriate to increase the number of shares available for these purposes. If the Incentive Plan Amendment is approved, we expect that the share reserve increase will allow us to continue to grant stock-based compensation at levels we deem appropriate for approximately the next 3 years (as discussed further below). If the Incentive Plan Amendment is not approved by stockholders, then to remain competitive without stock-based compensation arrangements, it will likely be necessary to replace components of compensation previously awarded in equity with cash. We do not believe increasing cash compensation to make up for any shortfall in equity compensation would

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be practical or advisable, because we believe that a combination of equity awards and cash compensation provides a more effective compensation strategy than cash alone for attracting, retaining and motivating our employees for the long term and more closely aligning employees’ and stockholders’ interests. In addition, any significant increase in cash compensation in lieu of equity awards could substantially increase our operating expenses and reduce our cash flow from operations, which could adversely affect our business results and could adversely affect our business strategy, including our ability to use cash flow for research and development of innovative new products and improvements in the quality and performance of existing products.

We Manage Our Equity Incentive Program and Stockholder Dilution Carefully

We manage our long-term stockholder dilution by limiting the number of equity awards granted for each of our fiscal years and granting what we believe to be the appropriate number of equity awards needed to attract, reward and retain employees. In doing so, we are also mindful of the potential dilution of stockholder value.

We last requested approval of our stockholders for additional shares under our Incentive Plan in 2023. At that time, we requested and received stockholder approval to increase the number of shares authorized under the Incentive Plan by 2,000,000 shares. Since that last increase, we have repurchased 3,060,121 million shares and our total issued and outstanding shares has decreased from 76,738,628 shares on February 28, 2023, to 73,726,315 shares on February 28, 2025.

#### Overhang
As of February 28, 2025, there were unvested RSUs (that vest based