Form 4: Vivani Medical Executive Granted Stock Options and Restricted Stock Units

Donald Dwyer, Chief Business Officer of Vivani Medical, received stock options and restricted stock units (RSUs) as part of his compensation.

Summary

• Donald Dwyer, the Chief Business Officer of Vivani Medical, Inc., was granted stock options and restricted stock units (RSUs) on May 10, 2024.
• The stock options are for 70,000 shares of common stock at an exercise price of $1.81 per share, expiring on May 9, 2034.
• These options vest 25% after one year and then monthly over the following 36 months, contingent upon continued service.
• Dwyer also received 35,000 performance-based RSUs, each representing a right to receive one share of Vivani common stock.
• The RSUs vest in three stages based on the stock price reaching $3.15 for three consecutive trading days, with subsequent vesting milestones one and two years after the initial target is met, also contingent upon continued service.
• If the stock price target is not met within four years, the RSUs will expire.
• A Limited Power of Attorney was executed on December 6, 2023, granting Adam Mendelsohn, Judy Wong, and Brigid Makes the authority to act on Dwyer's behalf for SEC filings related to Vivani Medical securities.

Sentiment

Score: 7

Explanation: The sentiment is neutral to slightly positive. The granting of stock options and RSUs is a standard practice, but it also indicates confidence in the executive's ability to contribute to the company's success. The performance-based RSUs suggest a focus on achieving specific stock price targets.

Positives

• The granting of stock options and RSUs aligns the executive's interests with those of the shareholders, incentivizing performance and stock price appreciation.
• The vesting schedule encourages long-term commitment from the executive.
• The performance-based RSUs provide a clear target for stock price improvement.

Negatives

• The RSUs will expire if the stock price does not reach $3.15 within four years, potentially leading to no benefit for the executive if the company underperforms.
• The vesting of both options and RSUs is contingent on continued service, meaning the executive must remain with the company to realize their full value.

Risks

• The company's stock price may not reach the $3.15 target required for the RSUs to vest.
• Executive turnover could result in the forfeiture of unvested stock options and RSUs.
• The value of the stock options and RSUs is subject to market fluctuations and the company's performance.

Future Outlook

The document does not contain specific forward-looking statements beyond the vesting schedules and expiration dates of the stock options and RSUs.

Industry Context

Granting stock options and RSUs is a common practice in the biotechnology industry to attract and retain key executives, aligning their interests with those of shareholders and incentivizing company growth.

Comparison to Industry Standards

• Stock option and RSU grants are standard compensation components for executives in publicly traded biotech companies like Vivani Medical.
• Vesting schedules, typically over 3-4 years, are designed to retain talent and align executive performance with long-term shareholder value.
• Performance-based RSUs, contingent on achieving specific stock price targets, are used to incentivize executives to drive company growth and increase shareholder returns, similar to practices at companies like Madrigal Pharmaceuticals or Viking Therapeutics.

Stakeholder Impact

• Shareholders may view the granting of stock options and RSUs positively, as it aligns executive interests with company performance.
• Employees may be motivated by the potential for company growth and stock price appreciation.
• The executive is incentivized to drive company success, which could benefit customers and suppliers.

Next Steps

• Dwyer will need to continue his service with Vivani Medical to vest in the stock options and RSUs.
• The company will need to achieve a stock price of $3.15 for three consecutive trading days for the RSUs to begin vesting.
• The attorneys-in-fact will handle any necessary SEC filings related to Dwyer's ownership of Vivani Medical securities.

Key Dates