Then here are five things you can do to help increase the chances that you will receive a favorable reaction from shareholder on your equity compensation plan proposal:
- Know What You Need: Figure out what types of awards and how many shares your company needs and why, i.e., what strategic goal(s) will having this plan/these shares help the company (and the employees) achieve?
- Know Your Shareholders: Figure out who your company’s top shares are, and what they want in an equity compensation plan.
- Know What You’re Willing to Do: Determine what your company is willing to do and why it can/can’t meet all of its shareholders’ requirements.
- Communicate with Shareholders: Talk to your key shareholders (top 10-20) to explain your proposal, why needed, and why can/cannot comply with all the shareholders’ requirements (as applicable), and why the shareholder should still support the proposal.
- Consider the Retail Vote: If your company shares are held by a significant number of retail investors or you think the retail vote could be more favorable to the proposal, consider whether it makes sense undertaking a retail vote solicitation to encourage retail investors to participate in the vote.