Form 4: Avidity Biosciences Executive Teresa McCarthy Reports Stock Transactions Following PSU Vesting

Chief Human Resources Officer Teresa McCarthy reports acquisition and disposal of Avidity Biosciences stock related to performance-based restricted stock units (PSUs) vesting.

Summary

• Teresa McCarthy, Chief Human Resources Officer of Avidity Biosciences, reported transactions involving the company's common stock.
• On September 19, 2024, McCarthy acquired 25,000 shares through the vesting of performance-based restricted stock units (PSUs) at a price of $0.
• These PSUs vested due to the achievement of a company performance objective related to the completion of a clinical event related to del-brax.
• On September 23, 2024, McCarthy sold 13,153 shares at a weighted-average price of $44.0004 to cover tax withholding obligations related to the PSU vesting.
• The sale was mandated by the Issuer's election under its equity incentive plans to require the satisfaction of tax withholding obligations to be funded by a 'sell-to-cover' transaction.
• McCarthy also acquired an additional 25,000 PSUs that converted to time-based restricted stock units, vesting on March 19, 2025, subject to continued employment.

Sentiment

Score: 6

Explanation: The sentiment is neutral to slightly positive. The vesting of PSUs indicates achievement of a clinical milestone, which is a positive sign. The sale of shares to cover taxes is a routine transaction.

Positives

• The vesting of PSUs indicates the achievement of a company performance objective, specifically the completion of a clinical event related to del-brax, which is a positive signal for the company's progress.

Future Outlook

An additional 25,000 time-based restricted stock units will vest on March 19, 2025, subject to the Reporting Person's continued employment or service through such date.

Industry Context

Executive stock transactions are common in publicly traded companies and are often related to compensation packages. The vesting of PSUs tied to clinical milestones reflects a performance-based incentive structure, aligning executive compensation with company goals.

Comparison to Industry Standards

• Executive compensation packages often include performance-based equity awards like PSUs to incentivize achievement of strategic goals.
• Sell-to-cover transactions are a standard mechanism for executives to manage tax obligations associated with equity vesting.
• The specific vesting conditions (clinical milestones) are tailored to the company's industry and development pipeline.

Stakeholder Impact

• Shareholders may view the achievement of the clinical milestone positively.
• The executive's stock transactions have a minimal direct impact on other stakeholders.

Key Dates