Form 4: PepGen CFO Donnelly Boosts Stake with RSU and Option Grants

PepGen Inc.'s Chief Financial Officer, Noel Donnelly, reported the acquisition of 76,793 restricted stock units and 300,000 stock options, increasing his beneficial ownership.

Summary

• Noel Donnelly, Chief Financial Officer of PepGen Inc., reported transactions on March 1, 2026.
• Acquired 76,793 Restricted Stock Units (RSUs) at a price of $0, each representing the contingent right to receive one share of Common Stock upon vesting.
• Acquired 300,000 stock options with an exercise price of $6.22 per share, expiring on February 29, 2036.
• Following these transactions, Donnelly beneficially owns 113,687 shares of common stock and 300,000 stock options.
• The common stock beneficial ownership includes 11,938 shares acquired on November 28, 2025, through the PepGen Inc. 2022 Employee Stock Purchase Plan, which was exempt under Rule 16b-3(c).

Sentiment

Score: 7

Explanation: StockSavvy.ai views this as a routine and expected disclosure of executive compensation, which is generally positive for executive retention and alignment with shareholder interests, but does not indicate a significant change in company fundamentals.

Positives

• Noel Donnelly, CFO, received a significant grant of 76,793 Restricted Stock Units, aligning his interests with long-term shareholder value.
• Donnelly also received 300,000 stock options, providing an incentive for future company performance and stock price appreciation.
• The grants demonstrate continued commitment and retention of a key executive.

Negatives

• The RSU and option grants represent potential future dilution for existing shareholders as they vest and are exercised.
• The exercise price of the options ($6.22) sets a benchmark for future stock performance required for the options to be in-the-money.

Risks

• The vesting of RSUs and stock options is contingent on Noel Donnelly's continued service to PepGen Inc., posing a risk if his employment ceases.
• The value of the stock options is subject to the future market price of PepGen Inc. common stock, which may not exceed the exercise price of $6.22.

Future Outlook

The grants of RSUs and stock options include specific vesting schedules, indicating future milestones for Noel Donnelly's equity compensation. The RSUs will vest in equal annual installments over four years, with the first installment on March 1, 2027. The stock options will vest 25% on the one-year anniversary of the grant date, with the remaining 75% vesting in 36 equal monthly installments thereafter. All vesting is subject to continued service.

Industry Context

StockSavvy.ai notes that executive equity grants, such as RSUs and stock options, are standard practice in the biotechnology and pharmaceutical industries. These grants are crucial for attracting, retaining, and incentivizing key talent like Chief Financial Officers, aligning their long-term financial interests with the company's performance and shareholder value creation. This particular filing reflects a routine compensation event for a senior executive.

Comparison to Industry Standards

• The grant of 76,793 RSUs and 300,000 stock options to a CFO in a biotech company like PepGen Inc. is generally consistent with executive compensation packages in the industry, particularly for companies focused on research and development.
• Similar companies in the biotech sector often use a mix of time-based vesting for RSUs and time-based vesting for options to ensure executive retention and motivation.
• The four-year vesting schedule for RSUs and the equivalent vesting for options (1-year cliff + 36 months) are common structures designed to promote long-term commitment.

Related Party Transactions

• The acquisition of 76,793 Restricted Stock Units and 300,000 Stock Options by Noel Donnelly, the Chief Financial Officer, constitutes a related party transaction as it involves compensation from the company to a key executive.

Stakeholder Impact

• Shareholders: Potential future dilution from the vesting and exercise of RSUs and options. However, these grants also align management's interests with long-term shareholder value creation.
• Employees: The grants to a senior executive may signal stability in leadership and a commitment to executive retention, potentially boosting morale.
• Management: Noel Donnelly's compensation package is enhanced, providing significant long-term incentives tied to the company's stock performance.

Next Steps

• The 76,793 Restricted Stock Units will begin vesting on March 1, 2027, in equal annual installments over four years.
• The 300,000 Stock Options will vest 25% on the one-year anniversary of the grant date (March 1, 2027), with the remaining 75% vesting in 36 equal monthly installments thereafter.

Key Dates

Recommendation

This Form 4 filing details routine executive compensation in the form of RSU and stock option grants. While these grants align the CFO's interests with shareholders, they do not provide new fundamental information about the company's operational performance, financial health, or strategic direction that would warrant a change in investment recommendation. It is a standard disclosure of insider activity.

Keywords

PepGen Inc., PEPG, Noel Donnelly, Chief Financial Officer, CFO, Restricted Stock Units, RSUs, Stock Options, Insider Trading, Beneficial Ownership, Equity Compensation, SEC Form 4, Executive Compensation