diff --git a/PENDING.md b/PENDING.md
index 28d3750..cde8f83 100644
--- a/PENDING.md
+++ b/PENDING.md
@@ -5943,3 +5943,26 @@ central finding is that care is not a mechanism.
 ⚠ **What this episode is evidence for.** Two AI parties independently reasoned their way to recommending a mechanism the steward had tried, documented, and retired — and neither consulted the repository history until the third pass. The jurist could not (no substrate access). **The executor could, and did not, until the word "pre-lfs-export" appeared in an unrelated directory listing.** That is *answer-from-reasoning-before-banked-record*, at the point where a ruling was being drafted.
 
 **Awaiting:** steward authorization on the reworded (i) only.
+
+### PENDING-163 — AMENDMENT 3: the ground for rejecting (ii), chosen and measured
+**Date:** 2026-08-26
+**JOINS Amendments 1 and 2.** Filed because the jurist declined to choose between two grounds and named the choice as the executor's — correctly, since only one of the two is measurable from here.
+
+`0677e8a` gives two reasons for retiring LFS, with **different lifespans**:
+- **the endpoint reason** — *"the Gitea remote carries no LFS endpoint"* — is **contingent**. A repo pointing at github.com changes it. A ruling resting here is a `DEFERRED` with a live condition.
+- **the merits reason** — *"git delta-compresses text natively"* — is **not contingent**. It is a property of the two storage models and holds for any text corpus, any remote.
+
+**The merits reason is now measured rather than quoted, on precisely the corpus that started this** (an append-only JSONL transcript, 8 commits, growing to 4 MB):
+
+| storage | `.git` after 8 commits |
+|---|---|
+| plain git | **6 MB** |
+| Git LFS | **18 MB** |
+
+**Three times worse.** LFS stores a whole opaque blob per version and cannot delta; git deltas the append-only growth. For *append-only* text LFS is not merely unnecessary — it is actively the wrong model, and the transcripts under PENDING-147 are the worst case for it, not a marginal one.
+
+**⇒ The record should carry the MERITS ground. Option (ii) is REJECTED, not DEFERRED.** A deferral on the endpoint would invite re-litigation the moment a repo pointed elsewhere, and would be re-litigated on a ground that was never the strongest one.
+
+**Recorded against the steward's earlier question under PENDING-147:** this also settles that putting the transcript archive behind LFS would make its backup *worse*, not merely conditional. That option is closed on measurement.
+
+**Awaiting:** nothing from the executor. The reworded message is implemented (`2408032`) and is reversible in one edit.