ALGN DEF 14A Report ended Dec. 31, 2019

¨	Preliminary Proxy Statement

¨	Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))

ý	Definitive Proxy Statement

¨	Definitive Additional Materials

¨	Soliciting Material under §240.14a-12

ý	No fee required.

¨	Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.

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¨	Fee paid previously with preliminary materials.

¨	Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.

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(1)	Mr. Larkin is Chairman of the Board

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•	Launched the Invisalign Moderate Package for the treatment of mild to moderate malocclusion that includes all the features of Invisalign treatment, plus additional features that address the orthodontic needs of teenage patients such as compliance indicators and compensation for tooth eruption

•	Launched the iTero Element 5D Imaging System for comprehensive, preventative and restorative oral care, expanding the suite of existing high-precision, full color imaging and fast scan times of the iTero Element portfolio

•	Launched the iTero Element Foundation intraoral scanner with restorative software, extending our portfolio of intraoral scanners with powerful 3D visualization to better meet the needs of doctors, labs and patients

•	Significantly increased our sales presence with the addition of approximately 100 new sales representatives in the first quarter of 2019 alone

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•	Annual cash incentives are capped and subject to challenging performance goals tied to strategic annual financial goals aimed at increasing stockholder value

•	The majority of executive officer compensation is equity-based to align incentives with long-term stockholder value, with 100% performance-based MSUs comprising 52% of our CEO's 2019 total target compensation and, on average, 46% of the total target compensation of our other named executive officers

•	2019 stockholder outreach extended to holders of approximately 78% of our issued and outstanding stock and included the Chairman of our Compensation Committee, our Senior Vice President, Global Human Resources, our Vice President, Corporate Communications and Investor Relations, and a representative of our third party compensation consultant, Compensia

•	We appointed a new director to our Board and Audit Committee in 2019 . the third in the last three fiscal years, increasing the number of women on our Board to three

•	We created a Corporate Social Responsibility ("CSR") organization, appointed a full-time dedicated Senior Director of CSR, established a CSR Committee, established the pillars of our comprehensive CSR program philosophy and expanded disclosures regarding our CSR efforts

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Q:	Why am I receiving these materials?

A:

Our Board of Directors (the “Board”) is providing these materials to you in connection with its solicitation of proxies for use at Align’s 2020 Annual Meeting of Stockholders, which will take place at 10:00 a.m., Pacific Time, on Wednesday, May 20, 2020 , at our corporate headquarters located at 2820 Orchard Parkway, San Jose, California 95134 (referred to in this proxy statement as the “Annual Meeting”). As a stockholder, you are invited to attend the Annual Meeting and are requested to vote on the items of business described in this proxy statement.

Q:	What if existing or revised COVID-19 restrictions are in effect or the Annual Meeting is held by remote communication?

A:

Due to the ongoing and evolving public health impact of COVID-19 (coronavirus), we are monitoring the need to impose additional procedures or limitations on attendees to protect the health and safety of our employees, directors and stockholders. Should our Board determine that any procedural or other limitations we may implement to protect the health and safety of our employees, directors or stockholders who choose to attend our Annual Meeting in person may not be effective or that to conduct the Annual Meeting in person would violate or impede any recommendations, laws or orders of public officials, we may decide to conduct the Annual Meeting solely by means of remote communication (i.e. a virtual-only meeting over live webcast). In the event we decide to modify the structure of our Annual Meeting, we will announce the decision to do so in advance, and details on how to participate will be set forth via a press release that will be filed with the SEC and available on our website at http://investor.aligntech.com/financial-information/sec-filings. If you are planning to attend the Annual Meeting in person, we recommend you check with the SEC and/or our website one week in advance of May 20, 2020.

Q:	What information is contained in these materials?

A:

The proxy materials include our proxy statement for the Annual Meeting and our 2019 Annual Report on Form 10-K ("Annual Report"). If you received a paper copy of these materials by mail, the proxy materials also include a proxy card for the Annual Meeting. If you received a notice of the Internet availability of the proxy materials instead of a paper copy of the proxy materials, see " How do I vote?" below. The information in this proxy statement contains important information regarding our Annual Meeting. Specifically, it identifies the proposals on which you are being asked to vote, provides information you may find useful in determining how to vote and describes the voting procedures.

Q:	Why did I receive a notice in the mail regarding the Internet availability of the proxy materials instead of a paper copy of the full set of proxy materials?

A:

In accordance with rules adopted by the SEC, we are making this proxy statement and our Annual Report available to our stockholders by providing access to such documents on the Internet instead of mailing printed copies. Stockholders will not receive printed copies of the proxy materials unless they request them. Instead, the Notice of Internet Availability of Proxy Materials ("Notice"), which was mailed to most of our stockholders, will instruct you as to how you may access and review all of the proxy materials on the Internet. The Notice also instructs you as to how you may submit your proxy via

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Q:	Can I vote my shares by filling out and returning the Notice of Internet Availability of Proxy Materials?

A:	No. The Notice only identifies the items to be voted on at the Annual Meeting. You cannot vote by marking the Notice and

Q:	Who can vote at the Annual Meeting?

A:	If you are a stockholder of record or a beneficial owner who owned our common stock at the close of business on March 25, 2020 , the record date for the Annual Meeting, you are entitled to vote at the Annual Meeting. As of the record date, 78,758,707 of our common stock were issued and outstanding and no shares of our preferred stock were issued and outstanding.

Q:	What is the difference between holding shares directly or as a beneficial owner, in street name?

A:	Most of our stockholders hold their shares as beneficial owners through a brokerage firm, bank or other nominee. As summarized below, there are some differences between shares held directly (of record) and those owned beneficially.

Q:	How do I vote?

A:

Voting via the Internet. You may vote by proxy over the Internet by following the instructions on the Notice. Stockholders who requested to receive printed proxy materials may submit proxies over the Internet by following the instructions on the proxy card. Most of Align’s stockholders who hold shares beneficially in street name may vote by accessing the website specified in the voting instructions provided by their broker, bank or other nominee. A number of banks and brokerage firms are participating in a program provided through Broadridge Investor Communication Solutions that offers the means to grant proxies to vote shares through the Internet. If your shares are held in an account with a broker or bank participating in the Broadridge Investor Communication Solutions program, you may grant a proxy to vote those shares via the Internet by contacting the website shown on the instruction form received from your broker or bank. To be counted at the Annual Meeting, your vote via the Internet must be received by 8:59 p.m. Pacific Time, on May 19, 2020 .

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Q:	What if I don’t give specific voting instructions?

A:	In the election of directors, you may vote “FOR,” “AGAINST” or “ABSTAIN.” If you elect to “ABSTAIN” in the election of directors, the abstention will not impact the election of directors. In tabulating the voting results for the election of directors, only "FOR" and "AGAINST" votes are counted.

Q:	Can I change or revoke my vote?

A:	Subject to any rules your broker or other nominee may have, you may change your proxy instructions at any time before your proxy is voted at the Annual Meeting.

•	grant a new proxy bearing a later date by following the instructions provided in the Notice or the proxy card, which will automatically revoke the previous proxy;

•	provide written notice of the revocation to:

•	attend the Annual Meeting and vote in person. Your attendance at the Annual Meeting will not cause your previously granted proxy to be revoked unless you specifically request that it be revoked.

•	timely submit new voting instructions to your broker or other nominee; or

•	if you have obtained a legal proxy from your broker or other nominee giving you the right to vote your shares at the Annual Meeting, attend the Annual Meeting and vote in person.

Q:	What are we voting on and what vote is required to approve each item?

A:	The proposals that will be presented at the Annual meeting, our Board's voting recommendations, the vote required and the way the vote is calculated for the proposals are as follows:

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Q:	What constitutes a quorum?

A:

A quorum, which is a majority of the outstanding shares of our common stock as of the record date, must be present or represented by proxy in order to hold the Annual Meeting and to conduct business. As of the record date, 78,758,707 shares of common stock, representing the same number of votes, were outstanding. That means that we need the holders of at least 39,379,354 shares of common stock to be represented for us to have a quorum. Your shares will be counted as present at the Annual Meeting if you attend the Annual Meeting in person. Your shares will be considered present and represented by proxy if you submit a properly executed proxy card or vote via the Internet or by telephone. Under the General Corporation Law of the State of Delaware, abstentions and broker “non-votes” are counted as present and entitled to vote and so are included for purposes of determining whether a quorum is present at the Annual Meeting.

Q:	Who will bear the cost of soliciting votes for the Annual Meeting?

A:

We will bear the entire cost of proxy solicitation, including the preparation, assembly, printing and mailing of proxy materials. The original solicitation of proxies by mail may be supplemented by solicitation by telephone and other means by directors, and employees of Align. None of these officers, directors or employees will receive special compensation for such services. In addition, we may reimburse brokerage firms and other custodians for their reasonable out-of-pocket expenses for forwarding these proxy materials to you.

Q:	Who will count the vote?

A:	We expect a representative from Align will tabulate the proxies and act as inspector of the election.

Q:	What is Align’s website address?

A.

Our website address is www.aligntech.com. We make this proxy statement, our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended, available on our website in the Investors section, as soon as reasonably practicable after electronically filing such material with the Securities and Exchange Commission (“SEC”).

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Q:	Where can I find the voting results of the meeting?

A:	The preliminary results will be announced at the Annual Meeting. The final results will be published in a Current Report on Form 8-K, which we will file with the SEC by May 26, 2020 .

Q:	What if multiple stockholders share the same address?

A:

To reduce expenses, we are delivering a single copy of the Notice and, if applicable, the proxy materials to certain stockholders who share a single address, unless otherwise requested by one of the stockholders. A separate proxy card is included in the voting materials for each of these stockholders. To receive a separate copy of the Notice and, if applicable, the proxy materials you may contact us by calling (408) 470-1000 or by writing to us at Align Technology, Inc., 2820 Orchard Parkway, San Jose, California 95134, Attn:  Investor Relations. You may also contact us by calling or writing if you would like to receive separate materials for future annual meetings.

Q:	Is there any information that I should know regarding future annual meetings?

A:

Stockholder proposals may be included in our proxy statement for an annual meeting so long as they are provided to us on a timely basis and satisfy the other conditions set forth in SEC regulations under Rule 14a-8 regarding the inclusion of stockholder proposals in company-sponsored proxy materials. For a stockholder proposal to be considered for inclusion in our proxy statement for the 2021 Annual Meeting of Stockholders, we must receive the proposal at our principal executive offices, addressed to the Corporate Secretary, no later than December 7, 2020. In addition, a stockholder proposal that is not intended for inclusion in our proxy statement under Rule 14a-8 may be brought before the 2021 Annual Meeting so long as we receive information and notice of the proposal in compliance with the requirements set forth in our Bylaws, addressed to the Corporate Secretary at our principal executive offices, not later than February 20, 2021 nor earlier than January 21, 2021.

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•	shares of Align common stock held directly by the non-employee director or executive officer or in trust for the benefit of such director or officer or her or his family member living in the same household,

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•	shares of underlying Align restricted stock units held directly by a non-employee director or executive officer, whether or not yet vested, and

•	50% of the gain on vested in-the-money stock options, if any.

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•	the highest personal and professional ethics and integrity;

•	proven achievement and competence in the nominee’s field and the ability to exercise sound business judgment;

•	skills and experience that are complementary to those of the existing Board;

•	the ability to assist and support management and make significant contributions to Align’s success; and

•	an understanding of the fiduciary responsibilities that is required of a member of the Board and the commitment of time and energy necessary to diligently carry out those responsibilities.

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•	our compensation programs are designed to provide a balanced mix of cash and equity, annual, and longer-term incentives in order to encourage strategies and actions that are in the long-term best interests of Align and our stockholders;

•	base salaries are consistent with an employees’ responsibilities so that they are not motivated to take excessive risks to achieve a reasonable level of financial security;

•	we annually assess performance under prior year compensation programs and make any adjustments deemed necessary or appropriate in order to mitigate opportunities or motives for excessive risk taking;

•	based on the review of prior results, we annually review and establish performance goals under our annual cash incentive plan that we believe (A) are reasonable in light of past performance and market conditions, and (B) encourage success without encouraging excessive risk taking to achieve short-term results, and, therefore, do not encourage unnecessary or excessive risk-taking;

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•	the performance goals that determine payouts under our annual cash incentive plans are company-wide in order to encourage decision-making that is in the best long-term interests of Align and our stockholders as a whole;

•	under our annual cash incentive plans, achievement of performance goals at levels below full target reduces only the payout related to that goal, not the other goals, and therefore does not result in an “all-or-nothing” approach;

•	our executive officers can receive a maximum award of 240% of their targets under our cash incentive compensation plan in order in part to avoid excessive risk taking;

•	the Compensation Committee has discretion over annual cash incentive program payouts;

•	for our executive officers, we use a portfolio of equity-based incentives that incentivize performance over a variety of time periods with respect to several balanced goals:

•	Restricted Stock Units ("RSUs") retain value even in a depressed market making it less likely that employees take unreasonable risks to get, or keep, equity grant “in the money”; and

•	Performance-based market stock units ("MSUs") measure relative stockholder return over a three-year performance cycle, thereby retaining value even if the price of Align's stock decreases in a market downturn; and

•	executive officers are subject to material share ownership guidelines.

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(1)	The amounts reflect the aggregate grant date fair value computed in accordance with FASB ASC Topic 718 of awards of RSUs. There can be no assurance that the grant date fair value amounts will ever be realized. The RSUs are time based awards and are not subject to performance or market conditions.

(2)	Mr. Larkin is the Chairman of the Board.

(3)	Ms. Myong was appointed to the Board on August 1, 2019.

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(1)	Mr. Larkin is the Chairman of the Board.

(2)	Ms. Myong was appointed to the Board on August 1, 2019.

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(1)

Audit fees — These are fees for professional services performed by PwC for the annual audit of Align’s financial statements and review of financial statements included in Align’s quarterly filings, and services that are normally provided in connection with statutory and regulatory filings or engagements, and attest services, except those not required by statute or regulation. For 2019, these fees also include certain services performed relating to our entity reorganization wherein our Europe, Middle East, and Africa ("EMEA") regional headquarters was moved from Amsterdam, the Netherlands to Rotkreuz, Switzerland.

(2)	Audit-related fees — These are fees related to assurance and related services, more specifically accounting consultations, that are also performed by PwC.

(3)	Tax fees — These are fees for professional services performed by PwC with respect to tax compliance, tax advice and tax planning. For 2019, these fees also include certain services performed relating to our entity reorganization wherein our EMEA regional headquarters was moved from Amsterdam, the Netherlands to Rotkreuz, Switzerland.

(4)	All other fees — These consist of all other fees billed to us for professional services performed by PwC and not reported under "Audit fees," "Audit-related fees" and "Tax fees."

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•	the integrity of Align’s financial statements;

•	Align’s compliance with legal and regulatory requirements;

•	the independent registered public accountant’s qualifications, independence and performance;

•	adequacy of Align’s internal accounting and financial controls; and

•	Align’s internal audit department.

•	providing guidance with respect to Align’s relationship with the independent auditors, including having responsibility for their appointment, compensation and retention;

•	involved in the selection of the audit firm’s lead engagement partner;

•	reviewing the results and audit scope;

•	approving audit and non-audit services;

•	reviewing and discussing with management the quarterly and annual financial reports;

•	overseeing and reviewing Align’s enterprise risk, privacy and data security; and

•	overseeing management’s implementation and maintenance of effective systems of internal controls.

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•	Joseph M. Hogan, our President and CEO

•	John F. Morici, our Chief Financial Officer and Senior Vice President, Global Finance

•	Julie Tay, our Senior Vice President and Managing Director, Asia Pacific

•	Emory M. Wright, our Senior Vice President, Global Operations

•	Raj Pudipeddi, our Senior Vice President and Chief Product, Innovation & Marketing Officer

•	Roger George, formerly our Senior Vice President, Chief Legal and Regulatory Officer

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•	Launched the Invisalign Moderate Package for the treatment of mild to moderate malocclusion that includes all the features of Invisalign treatment, plus additional features that address the orthodontic needs of teenage patients such as compliance indicators and compensation for tooth eruption

•	Launched the iTero Element 5D Imaging System for comprehensive, preventative and restorative oral care, expanding the suite of existing high-precision, full color imaging and fast scan times of the iTero Element portfolio

•	Launched the iTero Element Foundation intraoral scanner with restorative software, extending our portfolio of intraoral scanners with powerful 3D visualization to better meet the needs of doctors, labs and patients

•	Increased the use of iTero and other digital scanners to 79.5% in the Americas and 64.7% internationally by the fourth quarter of 2019

•	Trained 22,270 new Invisalign doctors, 9,765 in the Americas and 12,505 internationally

•	Increased Invisalign total utilization rates to 15.9 cases per doctor compared to 15.7 cases in 2018

•	Reached our 8 million th Invisalign patient milestone, with international volume increasing 34.0%

•	Significantly increased our sales presence with the addition of approximately 100 new sales representatives in the first quarter of 2019 alone

•	Opened a new order acquisition and treatment facility in Wroclaw, Poland and a new treatment facility in Yokohama, Japan

•	We have created long-term, sustained value for our stockholders. Our three-year TSR is 190% compared with the three-year NASDAQ Composite Index TSR and S&P 500 TSR of 67% and 44%, respectively.

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Our compensation program continues to emphasize performance-based pay. Our compensation program is designed to pay more when our financial and strategic performance is robust and less when it is not, providing built-in flexibility in the management of our operating expenses and enabling us to preserve strategic programs when economic conditions are unfavorable. A significant portion of our executive officers’ compensation is variable and tied to the success of our business and the individual performance of our executives. Consistent with this pay-for-performance orientation, Align believes that annual cash incentive (bonus) awards and long-term equity compensation should together represent the most significant portion of total target direct compensation. As a result, a larger portion of our executive officers’ total target compensation

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Annual cash incentive awards reflected positive 2019 Corporate performance. The Committee seeks to motivate executive management to continuously improve Align's financial performance through a cash incentive (bonus) plan that rewards higher performance with increased incentive opportunities. This provides us with a variable expense structure, allowing us to reduce our compensation costs in challenging times and reward performance when business conditions and results warrant. Based on our strong 2019 financial results, we achieved a weighted average of 190% of our financial targets. As a result, the annual incentive payments to our NEOs were between 190% to 199% of their target award opportunity.

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Equity awards are tied to the value of our common stock. Value received under our annual equity awards varies based on our stock price performance. In particular, payouts of our MSUs awarded to our executive officers vary based on the relative performance of our stock compared to the NASDAQ Composite Index. MSUs granted in 2019 are earned based on Align’s relative stockholder return over a three-year performance period, with 100% of the earned shares vesting at the end of three years. For MSUs granted in February 2016 that vested in February 2019 , Align stock outperformed the NASDAQ Composite Index by approximately 196% during the applicable performance period. As a result, due to Align’s continued outstanding stock price performance compared to the NASDAQ Composite Index during the performance period, the NEOs who were granted MSUs in February 2016 earned a maximum payout of 150% of their February 2016 target awards.

•	Compensation Committee Composed Solely of Independent Directors. Our Compensation Committee is composed solely of independent directors and it directly retains an independent compensation consultant.

•	Annual Say-on-Pay Votes. We elected to hold an annual stockholder advisory ("say-on-pay") vote, and the Compensation Committee considers the outcome of the advisory vote in making compensation decisions.

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Stock Ownership Guidelines. We maintain meaningful stock ownership guidelines for our executive officers and non-employee directors as a matter of good corporate governance and to demonstrate that the interests of our executive officers and non-employee directors are consistent with those of our stockholders. In 2019 , our stock ownership guidelines for each of our executive officers other than our CEO were 3.0x their annual salaries. Ownership guidelines for our CEO were 6.0x his annual salary. The stock ownership guidelines for our non-employee directors call for each non-employee director to own shares having $400,000 in market value.

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No “single-trigger” on Cash Compensation. All of our post-employment cash compensation arrangements in the event of a change in control of Align are “double-trigger” arrangements that require both a change in control of Align plus a qualifying termination of employment before any cash payments are paid. In addition, the employment agreements entered into by our CEO, CFO as well as any other executive officers who join us after September 2016 provide that such executive officer will

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Annual Compensation-Related Risk Assessment. Align’s executive officer compensation policies are structured to discourage inappropriate risk-taking by our executive officers. There are no guarantees that bonuses will be paid under our annual cash bonus incentive program and awards are capped at 240% of target in part to discourage excessive risk taking. The Compensation Risk Assessment located on page 16 of this proxy statement describes the Compensation Committee’s assessment that the risks arising from our company-wide compensation programs are reasonable, in the best interest of our stockholders, and unlikely to have a material adverse effect on us.

•	No Hedging or Pledging Company Stock. Employees may not directly or indirectly engage in transactions intended to hedge or offset the market value of Align’s common stock owned by them. In addition, our Insider Trading Policy further prohibits employees from directly or indirectly pledging Align common stock as collateral for any obligation.

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Carefully Manage Equity Burn Rates. We are committed to carefully managing the dilutive impact of equity compensation awards. Management and the Board regularly evaluate share utilization levels by reviewing the dilutive impact of stock compensation. Align’s overall equity-award-based gross burn rate for fiscal 2019 was 0.5% and Align's adjusted gross burn rate was 1.2%. Gross burn rate is defined as the number of equity awards granted in the year divided by shares outstanding. Adjusted gross burn rate includes a premium applied to full-value shares (e.g., RSUs and MSUs) of 2.5:1. We do not reprice, buyout or exchange underwater stock options and there is no liberal counting or recycling of shares.

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•	the comparison of Align’s TSR during the three-year performance period relative to the TSR of the companies in the S&P 500 Index at the beginning of the three-year performance period and which remain in the Index through the end of the three-year performance period; and

•	Align’s stock price at the end of the three-year performance period.

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1.	Target pay = base salary + target bonus + accounting value of equity awards

2.	Indexed TSR is defined as the total stockholder return on our common stock during the period from June 1, 2015 (J. Hogan hire date) through February 20, 2019 (FY19 annual grant timing), assuming $100 was invested on June 1, 2015.

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•	Offer competitive compensation . We seek to provide competitive compensation opportunities to attract, retain and incent superior talent.

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Reward performance . A significant portion of total target compensation for our NEOs is tied to the achievement of financial objectives. We believe that this supports our pay-for-performance philosophy by directly and substantially linking rewards to the achievement of measurable financial targets and a shared set of critical strategic priorities. By also rewarding individual performance, we seek to recognize outstanding individual contributions.

•	Link the interests of our executive officers with those of our stockholders . A significant portion of total target compensation for our NEOs is tied to the achievement of financial and strategic objectives and is in the form of long-term equity-based compensation. This structure is designed to focus decision-making and behavior on goals that are consistent with Align’s overall strategy.

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•	market comparison data (peer group data and survey data);

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•	subjective elements, such as:

•	the scope of the executive officer’s role;

•	the executive officer’s:

•	experience;

•	qualifications;

•	skills; and

•	performance during the fiscal year (see discussion below on “ Role of Individual Performance” );

•	internal equity; and

•	Align’s operational and financial performance.

•	Industry -medical device companies and medical technology companies, which are the industries from which we primarily recruit executive talent;

•	Market Capitalization -companies with a market capitalization between approximately $5.7 billion and $90.6 billion based upon the companies’ trading ranges at the time of selection which approximated 0.25 to 4.0 times Align's market capitalization at that time; and

•	Revenue -companies with revenue between approximately $535.0 million to $4.8 billion based upon the last four quarters of revenue at the time of selection which approximated 0.3 to 3.0 times Align's rolling four quarters of revenues at that time.

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•	base salary;

•	annual cash incentive awards; and

•	long-term equity-based incentive grants.

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(1)	The target performance and the level of performance at which the funding for that particular financial performance measure will be capped as follows:

•	A rating of zero if achievement is below 90% of target. Company performance below target automatically reduces only the payout related to that goal, not the other goals, as we want executive officers to have the same incentive to achieve other financial goals as well as their individual performance goals even if our performance tracks below the target during the course of the year;

•	A rating ranging from 90% to 100% if achievement meets or exceeds the minimum performance level but does not achieve the target performance level; and

•	A rating of 101% and above if achievement exceeds the target performance level. Each individual financial metric is uncapped; however, once the Company Multiplier reaches 240% in the aggregate, the bonus pool is fully funded. Therefore, in the aggregate, the bonus pool for our executive officers will not exceed 240% funding.

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(2)	The Compensation Committee has the discretion to exclude the following items from Revenues and Operating Income:

(a)	significant and/or extraordinary items that are not indicative of our core operating performance that are separately stated on our financial statements;

(b)	items identified as non-GAAP in Align’s quarterly earnings announcements; and

(c)	other discrete items as necessary that may result in unintended gain or loss under the bonus plan.

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(1 )	The number of MSUs set forth in this column represents the Target Shares; however, the actual number of MSUs that may be earned, if any, is determined based on the formula set forth in the MSU Agreement up to a maximum of 250% of the amount of the Target Shares.

•	a change of control; and

•	termination without cause or for convenience.

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(1)	Amounts reflect a one-time signing bonus for Mr. Pudipeddi.

(2)

The amounts shown in this column reflect the aggregate grant date fair value computed in accordance with FASB ASC Topic 718. Assumptions used in the calculations of these amounts are included in Note 1 - Summary of Significant Accounting Policies, Stock-Based Compensation and Note 11 - Stockholders' Equity (collectively, "Notes 1 and 11") to our audited financial statements for the year ended December 31, 2019 included in Align’s Annual Report on Form 10-K filed with the SEC on February 28, 2020 . This same method was used for the years ended December 31, 2018 and 2017 .

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(3)

Mr. George's 17-year tenure with Align, most recently as our Senior Vice President, Chief Legal and Regulatory Officer, ended on May 20, 2019. He remained an employee of the Company until September 1, 2019 (the "Termination Date"). In connection with his departure, Align and Mr. George entered into a Separation and Release Agreement that provided Mr. George would receive certain benefits in accordance with his Employment Agreement, including (i) a payment of $44,483, (ii) 18 months of his base salary ($660,000), (iii) a bonus the greater of his 2019 target bonus or actual 2018 bonus ($750,000), (iv) 150% of his target bonus for fiscal year 2019 ($308,016), (v) $50,769 accrued unpaid vacation, and (vi) 18 months acceleration of vesting of his outstanding equity awards resulting in a estimated realized gain of $3,584,928. Each of the foregoing amounts is included in “All Other Compensation” in the table above and the "All Other Compensation" table below. In addition, in connection with the acceleration of Mr. George's outstanding equity awards, Align incurred a stock based compensation modification expense of $510,164, which amount has been included in the "Stock Awards" column in the table above.

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•	cash amounts that could have been received in 2019 by our NEOs under the terms of our performance-based cash incentive plan (CIP); and

•	time-vested RSUs and performance-based MSUs awards granted by the Compensation Committee to our NEOs in 2019 reflected on an individual grant basis.

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Threshold. There is no threshold performance level. Rather, Align's financial performance below a specific target automatically reduces only the payout related to that specific goal, not the other goals, because we want our executive officers to have the same incentive to achieve strategic priorities as well as their individual performance goals even if our financial performance tracks below the target during the course of the year.

•	Target. The target amounts assume a corporate performance percentage of 100% and that the NEO received 100% of her or his target.

•	Maximum. The maximum amount any executive officer can receive is capped at 240% of their target award opportunity.

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Focal Awards Granted February 2019 . The amounts shown for MSU awards granted in February 2019 represent potential share payouts with respect to MSUs. Each MSU vests over a three-year performance period, with 100% vesting as of February 2022. The actual number of MSUs eligible to vest will be determined based on a comparison of Align’s stock price performance relative to the performance of the NASDAQ Composite index over the three-year performance period, up to a maximum of 250% of the number of target shares. If Align under-performs the NASDAQ Composite index, the percentage at which the MSUs convert into shares of Align stock will be reduced from 100% at a rate of three to one (three-percentage-point reduction in units for each percentage point of under-performance), with a minimum percentage of 0%. This means that no shares will vest if Align underperforms the NASDAQ Composite index by approximately 33%. If Align outperforms the NASDAQ Composite index, the percentage at which the MSUs convert to shares will be increased from 100%, at a rate of three to one (three-percentage-point increase in units for each percentage point of over-performance), with a maximum percentage of 250%. This means that if Align outperforms the NASDAQ Composite index by approximately 33%, the maximum number of shares that will vest is 250% of the award amount.

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Stock Awards. Stock awards represent grants of RSUs under our 2005 Incentive Plan. Since RSUs are taxable to each NEO when they vest, the number of shares we issue to each NEO will be net of applicable withholding taxes which will be paid by Align on behalf of each NEO. The RSUs will result in payment to the NEO only if the vesting criteria is met and the NEO then sells the stock that has vested. Each RSU granted to our NEOs vests over a four-year period with 25% of the shares subject to vesting each anniversary of the date of grant, with full vesting in four years.

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•	Align does not plan to time, nor has it timed, the release of material non-public information for the purpose of affecting the exercise price of its stock options should we decide to grant stock options again in the future;

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Consistent with the policy described in the bullet point above, all awards of equity compensation for new employees (other than new executive officers) are made on the first day of the month for those employees who started during the period between the 16 th day of the month that is two months prior to the grant date and the 15 th day of the month prior to the month of the grant date. For example, May 1, 2019 grants will cover new hires starting between March 16, 2019 and April 15, 2019 ; and

•	Annual incentive grants are made on or about the same day for all employees (including executive officers); in each of 2019 , 2018 , and 2017 such date was February 20. The Compensation Committee sets the actual grant date approximately one week following approval of the size of each grant in order to provide Align with adequate time to inform each employee individually of their grant.

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(1)	RSUs vest at a rate of 25% of the total number of shares on the first year, second year, third year and fourth year anniversary of the date of grant for vesting on February 20, 2017, February 20, 2018, February 20, 2019 and February 20, 2020.

(2)	RSUs vest at a rate of 25% of the total number of shares on the first year, second year, third year and fourth year anniversary of the date of grant for vesting on February 20, 2018, February 20, 2019, February 20, 2020, and February 20, 2021.

(3)	RSUs vest at a rate of 25% of the total number of shares on the first year, second year, third year and fourth year anniversary of the date of grant for vesting on February 20, 2019, February 20, 2020, February 20, 2021, and February 20, 2022.

(4)	RSUs vest at a rate of 25% of the total number of shares on the first year, second year, third year and fourth year anniversary of the date of grant for vesting on February 20, 2020, February 20, 2021, February 20, 2022, and February 20, 2023.

(5)	MSUs vest 100% on February 20, 2020.

(6)	MSUs vest 100% on February 20, 2021.

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(7)	MSUs vest 100% on June 2021.

(8)	MSUs vest 100% on February 20, 2022.

(9)	RSUs vest at a rate of 25% of the total number of shares on the first year, second year, third year and fourth year anniversary of the date of grant for vesting on November 20, 2017, November 20, 2018, November 20, 2019, and November 20, 2020.

(10)	RSUs vest at a rate of 25% of the total number of shares on the first year, second year, third year and fourth year anniversary of the date of grant for vesting on September 20, 2018, September 20, 2019, September 20, 2020, and September 20, 2021.

(11)	RSUs vest at a rate of 25% of the total number of shares on the first year, second year, third year and fourth year anniversary of the date of grant for vesting on March 20, 2020, March 20, 2021, March 20, 2022 and March 20, 2023

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(1)	For each NEO, such number of shares represents the gross number of shares acquired by the NEO on the vesting date; however, because RSUs and MSUs are taxable to the individuals when they vest, the number of shares we issue to each of our NEOs is net of applicable withholding taxes which are paid by us on their behalf.

(2)	The value realized on vesting equals the closing price per share of our common stock as reported on the NASDAQ Global Market on the vesting date multiplied by the gross number of shares acquired on vesting as described above in note 1.

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(1)	twice his then current annual base salary;

(2)	the then current year’s target bonus, prorated for the number of days Mr. Hogan has been employed during the year; and

(3)	the greater of 150% of the then current year’s target bonus or the prior year’s actual bonus.

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the performance period shall be deemed to end upon the closing of the change of control in order to determine Align’s stock price performance relative to the NASDAQ Composite index for the purpose of calculating the amount that Align has over or underperformed the NASDAQ Composite index (with the MSUs converting into shares of Align stock either being reduced from 100% (in the case of underperformance) or increased from 100% (in the case of overperformance) (the “Performance Multiplier”); and

•	Align’s stock price performance will be based on the per share value of Align’s common stock paid to its stockholders in connection with the change of control.

(1)	twice his then current annual salary;

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(2)	the then current year’s target bonus, prorated for the number of days Mr. Hogan has been employed during the year; and

(3)	the greater of 150% of the then current year’s target bonus or the prior year’s actual bonus.

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(i)	his then current annual base salary;

(ii)	his then current year’s target bonus, prorated for the number of days he has been employed during the year; and

(iii)	the greater of his then current year’s target bonus or the prior year’s actual bonus.

(i)	if Align under-performs the NASDAQ Composite index, the percentage at which the MSUs convert into shares of Align stock will be reduced from 100% at a rate of three to one; and

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(ii)	if Align outperforms the index, the percentage at which the MSUs convert to shares will be increased from 100% at a rate of three to one.

(3)	she or he is also entitled to receive a lump sum payment equal to:

(i)	her or his then current annual base salary;

(ii)	her or his then current year’s target bonus, prorated for the number of days she or he has been employed during the year; and

(iii)	the greater of her or his then current year’s target bonus or the prior year’s actual bonus.

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the performance period shall be deemed to end upon the closing of the change of control in order to determine Align’s stock price performance relative to the NASDAQ Composite index for the purpose of calculating the amount that Align has over or underperformed the NASDAQ Composite index (with the MSUs converting into shares of Align stock either being reduced from 100% (in the case of underperformance) or increased from 100% (in the case of overperformance) at a rate of two to one (for 2016 grants) or at a rate of three to one (for grants made in 2017 and 2018) (the “Performance Multiplier”); and

•	Align’s stock price performance will be based on the per share value of the Company’s common stock paid to its stockholders in connection with the change of control.

(i)	her or his then current annual base salary;

(ii)	her or his then current year’s target bonus prorated for the number of days employed during the year, and

(iii)	the greater of her or his then current year’s target bonus or the prior year’s actual bonus.

•	unauthorized use or disclosure of the confidential information or trade secrets of Align;

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•	any breach of the employment agreement or the Employee Proprietary Information and Inventions Agreement between the executive officer and Align;

•	conviction of, or a plea of “guilty” or “no contest” to, a felony under the laws of the United States or any state thereof;

•	misappropriation of the assets of Align or any act of fraud or embezzlement by the executive officer, or any act of dishonesty by the executive officer in connection with the performance of her or his duties for Align that adversely affects its business or affairs;

•	intentional misconduct; or

•	the executive officer’s failure to satisfactorily perform her or his duties after the executive officer has received written notice of such failure and was provided at least thirty (30) days to cure such failure.

•	the executive officer’s position, authority or responsibilities being significantly reduced;

•	the executive officer being asked to relocate her or his principal place of employment such that the commuting distance from her or his residence prior to the change of control is increased by over thirty-five (35) miles;

•	the executive officer’s annual base salary or bonus being reduced; or

•	the executive officer’s benefits being materially reduced.

•	a sale of all or substantially all of Align’s assets;

•	the acquisition of more than 50% of the common stock of Align by any person or group of persons;

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a reorganization of Align wherein the holders of common stock of Align receive stock in another company (other than a subsidiary of Align), a merger of Align with another company wherein there is a 50% or greater change in the ownership of the common stock of Align as a result of such merger, or any other transaction in which Align (other than as the parent corporation) is consolidated for federal income tax purposes or is eligible to be consolidated for federal income tax purposes with another corporation; or

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in the event that the common stock is traded on an established securities market, a public announcement that any person has acquired or has the right to acquire beneficial ownership of more than 50% of the then outstanding common stock of Align, or the commencement of or public announcement of an intention to make a tender offer or exchange offer for more than 50% of Align's then outstanding common stock.

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•	The Align Foundation - Recently launched in 2020, the Align Foundation provides a structured way to direct significant donations from a charitable investment fund, the flexibility to provide smaller monetary donations, processes to donate our products (the Invisalign System and iTero scanners) and organized ways to involve our employees in giving activities.

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Operation Smile - Since 2013, we have supported Operation Smile, an international medical charity that provides free surgeries to children and young adults in developing countries born with cleft lip, cleft palate or other dental and facial conditions. Consistent with our mission to transform smiles and change lives, it is a partnership that continues to grow and evolve. To date, we have donated approximately $1.4 million, enabling the organization to deliver the highest quality surgical care to tens of thousands of the world’s most vulnerable patients, and grow its reach to more than 60 countries. We were a corporate sponsor of Operation Smile’s 2018 International Student Leadership Conference and have committed to sponsor the event again in 2020. In recognition of our support of its mission, in November 2018 Align received Operation Smile's Corporate Humanitarian Award.

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Month of Smiles - Since 2018, we established a dedicated month of giving which we call the Month of Smiles, where all employees are encouraged to donate their time and talent to make a difference in the lives of others. In 2019, many of our offices around the world organized community service activities that offered employees the opportunity to work together as teams to help others. In addition, employees took time to give back to causes that are meaningful to them through volunteer activities, personal donations and intentional acts of kindness. Our collective impact was something of which we are proud - approximately 3,000 employees globally volunteered their time and gave approximately 5,000 hours back to their communities during our 2019 Month of Smiles.

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Women in Leadership - Our global women@align chapters offer and encourage networking, professional development, leadership mentoring, and educational projects. The intent is to attract, develop, and retain talented women while engaging all employees. As part of our commitment, we have initiated programs and dedicated resources aimed at recruiting, monitoring and enhancing programs designed to achieve our goals. We have launched training programs that allow all employees to identify unconscious biases in an effort to increase empathy and cultural awareness. Additionally, we plan to sponsor a Global Women Leadership Summit for emerging women leaders and those early in their careers.

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Month of Wellness - Launched in 2019, the Month of Wellness is a worldwide movement fostering employee health. We recognize that a strong and growing company needs healthy employees are committed to promoting wellness as part of our culture. The Month of Wellness provides employees with a variety of wellness activities and initiatives worldwide to support their overall wellbeing in areas such as nutrition, fitness, financial planning, and stress management.

•	Volunteer and Service Leadership - Our goal is to inspire and develop employees through serving others in the communities where they work and live. We encourage our employees to volunteer through organized company activities or on their own with volunteer time off programs for applicable employees.

•	Best Places to Work in IT by Computerworld who surveyed organizations across the U.S. to identify those that provide the best benefits and amenities for IT professionals. Among the attributes contributing to the award were our training, health insurance, retirement funding, flexible time off policies, and collaborative work environments.

•	Canadian Great Place to Work (GPTW) in Healthcare. To be eligible as a GPTW company, we had to be GPTW certified in the past year (certification requirements included a Culture Brief, 85% minimum survey participation, and a 7 out of 10 minimum average survey score) and work primarily in the Healthcare Sector. Companies were ranked based on employee responses to the GPTW Trust Index survey.

•	For the second year in a row, the Triangle Business Journal (TBJ) named Align's Raleigh, North Carolina office among the Top 50 Best Places to Work in the Triangle area based on employee feedback to a TBJ survey.

•	We opened new facilities and other sites that are closer to our customers which helps us decrease carbon emitting activities from shipping our products globally.

•	We have reduced the amount of plastic used in our aligners by almost 50% in just over four years.  In addition, we collect and ship the majority of all scrap/waste plastics generated by our manufacturing processes to an incinerator who then uses the resulting energy to power its operations; thereby substantially reducing the plastics sent to landfills.

•	We have a recycling program that encourages customers and their patients to return used aligners which are then incinerated. In 2020, we expect to expand this program in the U.S. and Brazil in partnership with Terracycle, an innovative recycling company that has become a global leader in recycling hard-to-recycle materials.

•	In 2019, our Juarez, Mexico manufacturing sites received two awards from the State of Chihuahua in recognition of our environmental efforts; one for environmental best practices and the other for environmental compliance.

•	We encouraged the usage of iTero scanners to reduce the need for traditional impressions and the mining of the materials used to make those impressions.

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Globally, we work to reduce the environmental impact of our processes and transportation by using energy efficient building designs and controls (e.g. solar panels, motion activated lights, LED lighting, etc.) and work to reduce emission from employee transportation by providing car charging stations to promote zero or low emission cars, incentives for carpooling, and organizing company sponsored employee transportation. We are also in the process of eliminating single use plastics in our cafeterias.

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•	each stockholder known by us to own beneficially more than 5% of our common stock;

•	each of our executive officers named in the summary compensation table on page 46 of this proxy statement;

•	each of our directors; and

•	all of our directors and executive officers as a group.

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*	Less than 1%

(1)

Except as otherwise set forth in the footnotes below, represents shares of common stock that can be acquired upon the exercise of stock options and vesting of restricted stock units on or before May 24, 2020 . This column includes the full amount of restricted stock units that will vest on or before May 24, 2020 , although each executive officer will actually receive the number of shares net of the number of shares necessary to cover any applicable withholding taxes which Align will pay on their behalf.

(2)	Based on a filing with the SEC on Schedule 13G/A on February 12, 2020 indicating beneficial ownership as of December 31, 2019 . Includes shares held by direct and indirect subsidiaries. The mailing address for The Vanguard Group is 100 Vanguard Blvd., Malvern, PA 19355.

(3)	Based on a filing with the SEC on Schedule 13G/A, on February 5, 2020 indicating beneficial ownership as of December 31, 2019 . Includes shares held by direct and indirect subsidiaries. The mailing address for BlackRock, Inc. is 55 East 52 nd Street, New York, New York 10055.

(4)	Based on a filing with the SEC on Schedule 13G/A on February 7, 2020 indicating beneficial ownership as of December 31, 2019 . Includes shares held in trust for immediate family members and shares held by immediate family members. The mailing address for Gordon Gund is P.O. Box 3599, Battlecreek, Michigan 49016-3599.

(5)	Based on a filing with the SEC on Schedule 13G on February 14, 2020 indicating beneficial ownership as of December 31, 2019 . Includes shares held by advisory clients of Edgewood Management LLC, none of whom are deemed to beneficially own more than 5% of Align's common stock. The mailing address for Edgewood Management LLC is 535 Madison Avenue, 15th Floor, New York, New York 10022.

(6)	Includes 1,500 shares held by a member of the household.

(7)	Includes 43,900 shares held by Mr. Thaler and 80,084 shares held by The Thaler Family Trust for the benefit of family members as to which Mr. Thaler disclaims beneficial ownership.

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•	you are a director or executive officer of Align and you desire to enter into a transaction with a Related Party (as defined above); or

•	you are an employee (other than a director or executive officer) and you desire to enter into a transaction with a Related Party that the Chief Financial Officer (in consultation with legal counsel) has deemed to be material to Align and is reportable under the rules and regulations of the Exchange Act,

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