Company: DVAX
Filing Date: 2025-04-17
Form Type: DEFC14A
Source: 0000930413-25-001273
Chunk: 79

Company: DYNAVAX TECHNOLOGIES CORP
Filing Date: 2025-04-17
Form: DEFC14A
Chunk 79
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Tax and Accounting Implications

Accounting for Stock-Based Compensation

Under Financial Accounting Standard Board ASC Topic
718 (“ASC 718”), we are required to estimate and record an expense for each award of equity compensation over the vesting
period of the award. We record share-based compensation expense on an ongoing basis according to ASC 718. The accounting impact of our
compensation programs is one of many factors that the Compensation Committee considers in determining the structure and size of our executive
compensation programs.

Deductibility of Executive Compensation

Under Section 162(m), compensation paid to each of
the Company’s “covered employees” that exceeds $1.0 million per taxable year is generally non-deductible.

Although the Compensation Committee will continue
to consider tax implications as one factor in determining executive compensation, the Compensation Committee also looks at other factors
in making its decisions and retains the flexibility to provide compensation for the Company’s NEOs in a manner consistent with the
goals of the Company’s executive compensation program and the best interests of the Company and its stockholders, which may include
providing for compensation that is not deductible by the Company due to the deduction limit under Section 162(m). The Compensation Committee
also retains the flexibility to modify compensation that was initially intended to be exempt from the deduction limit under Section 162(m)
if it determines that such modifications are consistent with the Company’s business needs.

Compensation Risk Analysis

During fiscal 2024, our Compensation Committee reviewed
our compensation policies as generally applicable to our employees in order to determine whether any such programs were likely to present
a material risk to the Company. As part of its assessment, the Compensation Committee considered, among other things, the allocation of
compensation among base salary and short- and long-term compensation, our approach to establishing Company-wide and individual financial,
operational and other performance targets, and the nature of our key performance metrics. As a result of this review and analysis, the
Compensation Committee determined that our policies and programs do not encourage excessive or inappropriate risk taking, and that the
level