Form 4: Vaxcyte SVP Granted Performance Stock Option

Mikhail Eydelman, SVP, General Counsel & Corporate Secretary of Vaxcyte, Inc., was granted a performance stock option to purchase 26,125 shares of the company's common stock.

Summary

• On November 7, 2024, Mikhail Eydelman, SVP, General Counsel & Corporate Secretary of Vaxcyte, Inc., received a performance stock option.
• The option allows him to purchase 26,125 shares of Vaxcyte's common stock at an exercise price of $102.70 per share.
• The option grant was part of a company-wide grant to all eligible employees.
• The option is subject to both service-based and performance-vesting conditions.
• The service-based vesting condition requires Eydelman to remain employed for three, four, and five years from the grant date, with one-third of the shares vesting on each anniversary.
• The performance-vesting condition requires the trading price of Vaxcyte's common stock to average at least $154.05 (150% of the grant date closing price) over a one-year period.

Sentiment

Score: 7

Explanation: The document indicates a standard executive compensation practice, aligning management interests with shareholders. The performance-based vesting suggests confidence in the company's future prospects.

Positives

• The grant of performance stock options aligns the interests of the executive with those of the shareholders, incentivizing him to increase the company's stock price.
• The vesting conditions encourage long-term commitment and performance.

Risks

• The performance-vesting condition may not be met if the company's stock price does not reach the required average, resulting in the option not fully vesting.

Future Outlook

The executive's compensation is tied to the future performance of the company's stock, incentivizing growth and value creation.

Industry Context

Granting stock options is a common practice in the biotechnology industry to attract and retain talent, aligning their interests with those of shareholders.

Comparison to Industry Standards

• Stock option grants are a standard component of executive compensation packages in the biotech industry, often used by companies like Amgen, Gilead Sciences, and Biogen.
• The vesting schedule and performance metrics are typical for incentivizing long-term value creation, similar to practices seen at Regeneron and Vertex Pharmaceuticals.

Stakeholder Impact

• Shareholders may view the performance-based stock option as a positive incentive for management to increase shareholder value.
• Employees may be motivated by the company-wide grant of stock options.

Key Dates