Form 4: Day One Bio Director's Options Repriced to $8.99

Day One Biopharmaceuticals director William Grossman's stock options were repriced to $8.99 per share, contingent on a retention period.

Summary

• Day One Biopharmaceuticals, Inc. director William Grossman had 98,995 stock options repriced on November 6, 2025.
• The original exercise prices of $13.81 for 66,660 shares and $13.87 for 32,335 shares were replaced with a new exercise price of $8.99 per share.
• The repricing was approved by the Issuer's Board of Directors on October 7, 2025.
• To exercise the repriced options at the new price, Mr. Grossman must remain in service with the Issuer through a Retention Period.
• The Retention Period begins on November 6, 2025, and ends on the earliest of the 12-month anniversary of this date or a Corporate Transaction.
• The repricing transactions are exempt under Rule 16b-6(d) and Rule 16b-3 of the Exchange Act.
• 66,660 of the repriced options vest at 1/36th of the total shares on each monthly anniversary, starting February 17, 2024, subject to continued service.
• The remaining 32,335 repriced options are fully vested.

Sentiment

Score: 6

Explanation: The repricing of director options at a lower exercise price is a direct financial benefit to the insider. For the company, it serves as a retention mechanism, ensuring continued service from a key director, which is generally positive for stability and strategic continuity.

Positives

• The exercise price for 98,995 stock options held by Director William Grossman was significantly lowered from $13.81 and $13.87 to $8.99 per share, providing a direct financial benefit to the reporting person.
• The repricing includes a retention period, incentivizing Mr. Grossman to remain in service with Day One Biopharmaceuticals for at least 12 months or until a Corporate Transaction.

Risks

• The ability to exercise the repriced options at the new lower price is contingent on the Reporting Person remaining in service through the specified Retention Period.
• The Retention Period could be cut short by a Corporate Transaction, potentially altering the intended retention incentive.

Future Outlook

The repricing of stock options for Director William Grossman is contingent on his continued service through a Retention Period, which extends for 12 months from November 6, 2025, or until an earlier Corporate Transaction. This aims to incentivize his ongoing commitment to the company.

Management Comments

• The Issuer's Board of Directors approved an option repricing (the 'Repricing') whereby the Reporting Person's options were repriced on November 6, 2025 (the 'Effective Date') with a new exercise price of $8.99 (if lower than the original exercise price), the closing price on Nasdaq as of the Effective Date.

Industry Context

Option repricing is a common practice in the biotechnology and pharmaceutical sectors, particularly when stock prices have declined, to re-incentivize key personnel. It aims to restore the motivational value of equity awards and retain experienced directors and executives, which is crucial for companies like Day One Biopharmaceuticals focused on long-term drug development.

Comparison to Industry Standards

• Option repricing, while sometimes viewed critically by shareholders, is a recognized tool for executive retention and motivation, especially in volatile sectors like biotech.
• The inclusion of a retention period, as seen here, aligns with best practices to ensure that the repricing serves a strategic purpose beyond simply benefiting the insider.
• The repricing being tied to the closing price on the effective date ($8.99) is a standard method for setting the new exercise price.

Corporate Governance

Related Party Transactions

• The repricing of stock options for William Grossman, a director of Day One Biopharmaceuticals, constitutes a related party transaction between the company and a key management individual.

Stakeholder Impact

• Shareholders: Potential for minor dilution if the repriced options are exercised, but the retention of a director could contribute to long-term stability and strategic execution.
• Employees: No direct impact mentioned, but such actions can influence overall compensation philosophy and morale.
• Director (William Grossman): Directly benefits from a lower exercise price on a significant number of options, increasing the potential value of his equity holdings, contingent on continued service.

Next Steps

• William Grossman must remain in service with Day One Biopharmaceuticals through the Retention Period to exercise the repriced options at the new $8.99 price.
• The Retention Period will conclude on the 12-month anniversary of November 6, 2025, or upon an earlier Corporate Transaction.

Key Dates

Keywords

Day One Biopharmaceuticals, DAWN, William Grossman, stock options, option repricing, insider transaction, Form 4, SEC filing, corporate governance, director compensation, equity incentive plan