Kezar Announces Inducement Grant Under NASDAQ Listing Rule 5635(c)(4)

Rhea-AI Summary

Kezar Life Sciences (Nasdaq: KZR), a clinical-stage biotech firm, announced a nonqualified stock option grant to purchase 80,000 shares at $0.71 per share.

The stock option, granted to a new employee on June 3, 2024, is in line with Nasdaq Listing Rule 5635(c)(4). The grant is part of Kezar's strategy to attract top talent.

The options will vest over four years: 25% after the first year, with the remainder vesting monthly. This grant is material to the individual’s employment agreement and is part of Kezar's 2022 Inducement Plan.

Positive

• Grant of 80,000 stock options may help attract and retain top talent.
• Stock option vesting terms are structured to encourage long-term employee retention.
• Exercise price set at $0.71 per share, equal to the closing price on the grant date, aligns employee incentives with shareholder interests.

Negative

• The vesting schedule extends over four years, which may delay the realization of any benefits for the employee.
• Granting stock options could lead to potential shareholder dilution over time.
• Current stock price at $0.71 suggests low market valuation, which might concern potential investors.

SOUTH SAN FRANCISCO, Calif.--(BUSINESS WIRE)-- Kezar Life Sciences, Inc. (Nasdaq: KZR), a clinical-stage biotechnology company developing novel small molecule therapeutics to treat unmet needs in immune-mediated diseases and cancer, today announced that the Compensation Committee of the company’s Board of Directors granted one employee a nonqualified stock option to purchase 80,000 shares of its common stock with an exercise price of $0.71 per share, which is equal to the closing price of Kezar’s common stock on June 3, 2024, the grant date of the award. The stock option was granted as an inducement award material to the individual entering into employment with Kezar, in accordance with Nasdaq Listing Rule 5635(c)(4).

The stock option will vest over a four-year period, with 25% of the option vesting on the first anniversary of the employee’s start date, and 1/48th of the total shares vesting monthly thereafter, subject to continued employment on each vesting date. The option is subject to the terms and conditions of Kezar’s 2022 Inducement Plan and the stock option agreement covering the grant.

About Kezar Life Sciences

Kezar Life Sciences is a clinical-stage biopharmaceutical company developing novel small molecule therapeutics to treat unmet needs in immune-mediated diseases and cancer. Zetomipzomib, a selective immunoproteasome inhibitor, is currently being evaluated in a Phase 2b clinical trial for lupus nephritis and a Phase 2a clinical trial for autoimmune hepatitis. This product candidate also has the potential to address multiple chronic immune-mediated diseases. Kezar’s oncology product candidate, KZR-261, targeting the Sec61 translocon and protein secretion pathway, is being evaluated in an open-label dose-escalation Phase 1 clinical trial to assess safety, tolerability and preliminary tumor activity in solid tumors. For more information, visit www.kezarlifesciences.com, and follow us on LinkedIn, Facebook, Twitter and Instagram.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240607753645/en/

Investor and Media Contact:

Gitanjali Jain

Vice President, Investor Relations and External Affairs

Kezar Life Sciences, Inc.

gjain@kezarbio.com

Source: Kezar Life Sciences, Inc.

FAQ

What is the significance of Kezar's stock option grant under Nasdaq Listing Rule 5635(c)(4)?

Kezar's stock option grant under Nasdaq Listing Rule 5635(c)(4) is significant as it helps attract and retain talent by offering them a stake in the company.

When was the stock option grant by Kezar announced?

The stock option grant was announced on June 3, 2024.

How many shares are included in Kezar's stock option grant?

The stock option grant includes 80,000 shares.

What is the exercise price of Kezar's stock option grant?

The exercise price of the stock option grant is $0.71 per share.

How is the vesting schedule for Kezar's stock option grant structured?

The vesting schedule allows 25% of the options to vest after the first year, with the remainder vesting monthly over the next three years.

What is the potential impact of Kezar's stock option grant on shareholders?

The stock option grant could lead to potential shareholder dilution over time as more shares are issued.