Equillium Reports Inducement Grant Under Nasdaq Listing Rule 5635(c)(4)

Rhea-AI Summary

Equillium announced on May 31, 2024, that its Compensation Committee granted a nonstatutory stock option award to a new employee under the company's 2024 Inducement Plan. This inducement award, approved under Nasdaq Listing Rule 5635(c)(4), consists of 7,200 shares of common stock with an exercise price of $1.50 per share, which matches the closing stock price on May 31, 2024. The vesting schedule for this award spans four years, with 25% vesting after one year and the remainder vesting monthly over the next three years, contingent on the employee's continued service with Equillium.

Positive

• Grant of 7,200 shares of common stock as an inducement award may help attract and retain key talent.
• Exercise price of $1.50 per share matches the closing stock price on the grant date, which can be favorable if the stock price increases.
• Vesting schedule promotes long-term commitment from the new employee, aligning their interests with company performance.

Negative

• The stock option grant could lead to shareholder dilution.
• Incentive structure based on stock options may not guarantee improved company performance if the stock price does not appreciate.

LA JOLLA, Calif.--(BUSINESS WIRE)-- Equillium, Inc. (Nasdaq: EQ), a clinical-stage biotechnology company focused on developing novel therapeutics to treat severe autoimmune and inflammatory disorders, today announced that on May 31, 2024, the Compensation Committee of Equillium’s Board of Directors granted an inducement award consisting of a nonstatutory stock option to purchase 7,200 shares of common stock to a new employee under Equillium’s 2024 Inducement Plan. The Compensation Committee approved the stock option as an inducement material to the new employee’s employment in accordance with Nasdaq Listing Rule 5635(c)(4).

The stock option has an exercise price per share equal to $1.50, Equillium’s closing stock price on May 31, and will vest over four years, with 25% of the underlying shares vesting on the one-year anniversary of the applicable vesting commencement date and the balance of the underlying shares vesting monthly thereafter over 36 months, subject to the new employee’s continued service relationship with Equillium through the applicable vesting dates. The stock option is subject to the terms and conditions of Equillium’s 2024 Inducement Plan and the terms and conditions of an applicable stock option agreement covering the grant.

About Equillium

Equillium is a clinical-stage biotechnology company leveraging a deep understanding of immunobiology to develop novel therapeutics to treat severe autoimmune and inflammatory disorders with high unmet medical need. The company’s pipeline consists of the following novel first-in-class immunomodulatory assets and product platform targeting immuno-inflammatory pathways. EQ101: a selective tri-specific cytokine inhibitor targeting IL-2, IL-9, and IL-15; recently announced positive results from a Phase 2 proof-of-concept clinical study of patients with alopecia areata in Australia and New Zealand by Equillium’s Australian subsidiary as the trial sponsor. EQ302: an orally delivered, selective bi-specific cytokine inhibitor targeting IL-15 and IL-21; currently in pre-clinical development. The multi-cytokine platform: generates rationally designed composite peptides that selectively block key cytokines at the shared receptor level targeting pathogenic cytokine redundancies and synergies while preserving non-pathogenic signaling. Itolizumab: a monoclonal antibody that targets the CD6-ALCAM signaling pathway which plays a central role in the modulation of effector T cells; currently under evaluation in a Phase 3 clinical study of patients with acute graft-versus-host disease (aGVHD) and a Phase 1b clinical study of patients with lupus/lupus nephritis. Equillium acquired rights to itolizumab through an exclusive partnership with Biocon Limited and has entered a strategic partnership with Ono Pharmaceutical Co., Ltd., for the development and commercialization of itolizumab under an option and asset purchase agreement.

For more information, visit www.equilliumbio.com.

Forward Looking Statements

Statements contained in this press release regarding matters that are not historical facts are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by the use of words such as "anticipate", "believe", “could”, “continue”, "expect", "estimate", “may”, "plan", "outlook", “future” and "project" and other similar expressions that predict or indicate future events or trends or that are not statements of historical matters. Because such statements are subject to risks and uncertainties, many of which are outside of Equillium’s control, actual results may differ materially from those expressed or implied by such forward-looking statements. Risks that contribute to the uncertain nature of the forward-looking statements include: Equillium’s ability to execute its plans and strategies; risks related to performing clinical studies; and whether the results from clinical studies will validate and support the safety and efficacy of Equillium’s product candidates. These and other risks and uncertainties are described more fully under the caption "Risk Factors" and elsewhere in Equillium's filings and reports, which may be accessed for free by visiting the Securities and Exchange Commission’s website at www.sec.gov and on Equillium’s website under the heading “Investors.” Investors should take such risks into account and should not rely on forward-looking statements when making investment decisions. All forward-looking statements contained in this press release speak only as of the date on which they were made. Equillium undertakes no obligation to update such statements to reflect events that occur or circumstances that exist after the date on which they were made, except as required by law.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240605758743/en/

Michael Moore

Vice President, Investor Relations & Corporate Communications

619-302-4431

ir@equilliumbio.com

Source: Equillium, Inc.

FAQ

What was the date of the inducement award granted by Equillium?

The inducement award was granted on May 31, 2024.

How many shares were included in Equillium's inducement award?

The inducement award included 7,200 shares of common stock.

What is the exercise price for the stock options granted by Equillium?

The exercise price for the stock options is $1.50 per share.

What is the vesting period for Equillium's inducement award?

The vesting period spans four years, with 25% vesting after one year and the remaining shares vesting monthly over the following 36 months.

Under which rule was Equillium's inducement award approved?

The inducement award was approved under Nasdaq Listing Rule 5635(c)(4).