UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A

PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE

SECURITIES EXCHANGE ACT OF 1934

(Amendment No.     )

Filed by the Registrant    ☒            Filed by a Party other than the Registrant    ☐

Check the appropriate box:

KODIAK SCIENCES INC.

(Name of Registrant as Specified In Its Charter)

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check all boxes that apply):

Dear Kodiak Stockholders:

You are cordially invited to attend the 2022 Annual Meeting of Stockholders of Kodiak Sciences Inc., which will be held on June 7, 2022. Details are included in our proxy statement.

We believe we made important progress in 2021 toward our goal of developing the science of our ABC platform into innovative, next-generation medicines to prevent and treat chronic, high-prevalence retinal diseases. We expanded the pivotal clinical program of our lead product candidate KSI-301 with the initiation of two additional Phase 3 studies: DAYLIGHT in wet age-related macular degeneration (“AMD”) and GLOW in non-proliferative diabetic retinopathy (“NPDR”). We also continued to invest in advancing our pipeline product candidates and manufacturing capabilities.

Innovative medicines development carries inherent risk. While we were aware of this, we were still surprised and tremendously disappointed by the top-line results earlier this year from our initial Phase 2b/3 study in wet AMD, which did not meet the primary endpoint.

Our directors beneficially own approximately a third of our outstanding shares, and our senior management team had overwhelmingly opted to participate in the Kodiak 2021 Long-Term Performance Incentive Plan (“2021 LTPIP” or “LTPIP”) that was approved by our stockholders on October 13, 2021. The LTPIP was predicated on a long-term commitment over seven years to the creation of substantial stockholder value based on significant share price gains over then-current trading prices. The substantial drop of Kodiak’s share price since our Phase 2b/3 readout greatly impacted the senior leaders of the Company as well as our stockholders. We, like you, felt the immense disappointment of this trial outcome.

The silver lining of demonstrating what we believe is unprecedented durability in the study results, with durability being a “north star” of our ABC Platform design and development, suggests to us that much of our potential is achievable. We have and will continue to analyze and respond to the Phase 2b/3 study results, incorporating learnings from them into our ongoing Phase 3 studies. As information and data evolve, we expect to remain thoughtful and agile in our approach to maximize the clinical and regulatory success of KSI-301. We are anticipating top-line readouts from four more Phase 3 studies in 2022 and 2023 to support what we hope is an initial BLA across multiple indications.

We are well capitalized with $731.5 million at the end of 2021, and we will continue to explore how to utilize our cash to best support our priorities.

We remain optimistic that we will achieve our dual goal of bringing innovative therapies to patients with retinal diseases and creating long-term value for stockholders. Thank you for your investment in Kodiak.

Sincerely,

Victor Perlroth, M.D.

Chief Executive Officer and Chairman of the Board

        KODIAK SCIENCES INC.

        1200 Page Mill Road

        Palo Alto, CA 94304

Notice of Annual Meeting of Stockholders

To Be Held on June 7, 2022

Dear Kodiak Stockholders:

Attendance: In order to attend via webcast, you must register in advance at www.proxydocs.com/KOD prior to June 3, 2022 at 2:00 p.m. Pacific Daylight Time. Upon completing your registration, you will receive further instructions via email, including your unique link that will allow you access to the meeting and you will have the ability to submit questions. Please be sure to follow the instructions on the enclosed proxy card and/or voting instruction form and subsequent instructions that will be delivered to you via email. If you attend via webcast the 2022 Annual Meeting of Stockholders virtually, you may submit an electronic ballot during the meeting.

Voting: YOUR VOTE IS VERY IMPORTANT. Whether or not you plan to attend via webcast the 2022 Annual Meeting of Stockholders, we encourage you to read the proxy statement and vote as soon as possible.

We appreciate your continued support of Kodiak Sciences Inc. and look forward to you joining our meeting or receiving your proxy.

By order of the board of directors,

Victor Perlroth, M.D.

Chief Executive Officer and Chairman of the Board

Palo Alto, California

April 28, 2022

TABLE OF CONTENTS

This proxy statement contains “forward-looking statements” within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, or Exchange Act. We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends affecting the financial condition of our business. Forward-looking statements should not be read as a guarantee of future performance or results and will not necessarily be accurate indications of the times at, or by, which such performance or results will be achieved. Forward-looking statements are based on information available at the time those statements are made and/or management’s good faith beliefs as of that time with respect to future events, and are subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed in or suggested by the forward-looking statements. Forward-looking statements include all statements that are not historical facts. In some cases, you can identify forward-looking statements by terms such as “may,” “might,” “will,” “objective,” “intend,” “should,” “could,” “can,” “would,” “expect,” “believe,” “anticipate,” “project,” “target,” “design,” “estimate,” “predict,” “potential,” “plan”, “hope” or the negative of these terms, or similar expressions and comparable terminology intended to identify forward-looking statements. These statements reflect our current views with respect to future events and are based on assumptions and subject to risks and uncertainties. Forward-looking statements include, but are not limited to, statements about durability in study results, durability of the ABC Platform, analyzing and responding to the Phase 2b/3 study of KSI-301 in neovascular (wet) age-related macular degeneration and incorporation of learnings into ongoing Phase 3 studies, timing of top-line readouts from Phase 3 studies, achievement of goals, expectation of announcing topline data, potential use of study results to form of the basis of an initial BLA, and our financial position, including the ability to advance the KSI-301 program, manufacturing activities necessary for a BLA submission, and ability to advance our pipeline of drug candidates.

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PROXY SUMMARY

For 2022 Annual Meeting of Stockholders

To be held on Tuesday, June 7, 2022 at 9:00 a.m. Pacific Daylight Time

This summary highlights information contained elsewhere in this proxy statement. It does not contain all of the information that you should consider. You should read the entire proxy statement carefully before voting.

We have first released this proxy statement to Kodiak Sciences, Inc. stockholders beginning on April 28, 2022.

Annual Meeting of Stockholders

You are entitled to vote if you held Kodiak stock on the record date. Each share of Kodiak common stock is entitled to one vote.

We have adopted a virtual meeting format again this year to enable broad access for our stockholders and employees, regardless of their geographic location.

Voting matters

Company Overview

We are a biopharmaceutical company committed to researching, developing and commercializing transformative therapeutics to treat high-prevalence retinal diseases. Founded in 2009, we are focused on bringing new science to the design and manufacture of next generation retinal medicines to prevent and treat the leading causes of blindness globally. Our ABC Platform uses molecular engineering to merge the fields of antibody-based and chemistry-based therapies and is at the core of Kodiak’s discovery engine. Kodiak’s lead product candidate, KSI-301, is a novel anti-VEGF antibody biopolymer conjugate being developed for the treatment of retinal vascular diseases including wet age-related macular degeneration (“AMD”), the leading cause of blindness in elderly patients in the developed world, and diabetic eye diseases, the leading cause of blindness in working-age patients in the developed world. Kodiak has leveraged its ABC Platform to build a pipeline of product candidates in various stages of development including KSI-501, our bispecific

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anti-IL-6/VEGF biopolymer conjugate for the treatment of neovascular retinal diseases with an inflammatory component, and we are expanding our early research pipeline to include ABC Platform based triplet inhibitors for multifactorial retinal diseases such as dry AMD and glaucoma.

2021 Performance Highlights

We believe our execution was strong in 2021. While we experienced a set-back in early 2022 with our Phase 2b/3 pivotal study topline results in wet AMD, we remain committed to our mission of working to resolve the biggest challenges in ophthalmology. In 2021, we significantly progressed our KSI-301 pivotal study program in which we expect to announce topline data in 2022 and 2023. The program includes our Phase 3 BEACON study in retinal vein occlusion (“RVO”), our paired Phase 3 GLEAM/GLIMMER studies in diabetic macular edema (“DME”), and our Phase 3 DAYLIGHT study in wet AMD. If successful, these pivotal studies are anticipated to form the basis of Kodiak’s initial BLA to support potential approval and commercialization in multiple diseases, with a full range of labeled and reimbursable dosing frequencies. While engaged in these development efforts, we believe we have demonstrated a disciplined and creative approach to building and financing the company. We believe we remain financially well-positioned to advance the KSI-301 program, including the manufacturing activities necessary for biologics license application (“BLA”) submission, and to advance our pipeline of drug candidates in other high prevalence retinal disorders.

As a team, we can look back proudly at all that Kodiak accomplished in 2021:

Key Highlights from Fiscal 2021

Corporate Responsibility

We intend to publish our inaugural Environmental, Social and Governance (“ESG”) report soon. Kodiak is committed to the mission of preventing and treating the leading causes of blindness in a socially responsible and sustainable way. We believe that establishing sound ESG principles is vital to providing long-term value for our stakeholders, including patients, employees, stockholders and the broader communities in which we operate. Our inaugural ESG report will provide an overview of Kodiak’s ESG strategies, activities, performance and commitments for the 2021 financial year. Kodiak’s board and executive team collaborate to prioritize and oversee the company’s ESG activities. At present, our ESG priorities reflect our focus as a clinical-stage company seeking to complete Phase 3 clinical trials for our lead candidate, KSI-301, and pave the path towards commercialization. Select details are below, and for further information please see our upcoming ESG report which will be available on our website.

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PROPOSAL NO. 1

ELECTION OF DIRECTORS

Our business affairs are managed under the direction of our board of directors, which is currently composed of seven members. Six of our directors are “independent” under the listing standards of The Nasdaq Stock Market (“Nasdaq”). Our board of directors is divided into three staggered classes of directors. At each annual meeting of stockholders, a class of directors will be elected for a three-year term to succeed the same class whose term is then expiring.

Each director’s term continues until his or her successor is duly elected and qualified or until his or her earlier death, resignation or removal. Any increase or decrease in the number of directors will be distributed among the three classes so that, as nearly as possible, each class will consist of one-third of the directors. This classification of our board of directors may have the effect of delaying or preventing changes in control of our company.

The following table sets forth the names and certain other information for each of the nominees for election as a director and for each of the continuing members of our board of directors, including their respective ages as of April 11, 2022.

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BOARD OF DIRECTORS AND CORPORATE GOVERNANCE

Director Nominees for Election

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Director Nominees for Election

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Continuing Directors in Office Until the 2023 Annual Meeting of Stockholders

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Continuing Directors in Office Until the 2023 Annual Meeting of Stockholders

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Continuing Directors in Office Until the 2023 Annual Meeting of Stockholders

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Continuing Directors in Office Until the 2024 Annual Meeting of Stockholders

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Director Independence

Our board of directors has undertaken a review of its composition, the composition of its committees and the independence of directors and considered whether any director has a material relationship with us that could compromise his or her ability to exercise independent judgment in carrying out his or her responsibilities. Based upon information requested from and provided by each director concerning his or her background, relevant identified transactions, employment and affiliations, including family relationships, the board of directors has determined that none of Mr. Profusek, Mr. Bancroft and Drs. Levy, Dahiyat, Yang or Baker, representing six of our seven directors, has a relationship which would interfere with the exercise of independent judgment in carrying out the responsibilities of a director and that each of these directors is an “independent director” as defined under the rules of Nasdaq. The board of directors reviews on an annual basis the independence standards for those committees established by applicable SEC rules and the rules of Nasdaq and has also determined that (i) Mr. Bancroft (chairman), and Drs. Dahiyat and Yang, who currently comprise our audit committee, (ii) Dr. Baker (chairman), Mr. Bancroft and Mr. Profusek, who currently comprise our compensation committee, and (iii) Mr. Profusek (chairman), Drs. Baker and Levy, and Mr. Bancroft, who comprise our nominating and corporate governance committee, satisfy such standards. In making this determination, our board of directors considered the relationships that each non-employee director has with us and all other facts and circumstances our board of directors deemed relevant in determining their independence, including the beneficial ownership of our capital stock by each non-employee director.

Leadership Structure

Dr. Perlroth, our Chief Executive Officer, is also the Chairman of our board of directors. Our board of directors believes that having our Chief Executive Officer also serve as the Chairman of our board of directors provides us with optimally effective leadership, providing a single, clear chain of command to execute our strategic initiatives and business plan and acting as a bridge between management and our board of directors and is thus in our best interests and those of our stockholders. Dr. Perlroth co-founded our company, and our board of directors believes that Dr. Perlroth’s years of management experience in the pharmaceutical industry as well as his extensive understanding of our business, operations, and strategy make him well qualified to serve as Chairman of our board.

In August 2018, our board of directors appointed Mr. Profusek to serve as our lead independent director. As lead independent director, Mr. Profusek presides over periodic meetings of our independent directors, serve as a liaison between the Chairman of our board of directors and the independent directors and performs such additional duties as our board of directors may otherwise determine and delegate.

Board Meetings and Committees

During the year ended December 31, 2021, our board of directors held 6 meetings (including regularly scheduled and special meetings) and no incumbent director attended fewer than 75% of the total number of meetings of the board of directors and the committees of which such director was a member.

Although we do not have a formal policy regarding attendance by members of our board of directors at annual meetings of stockholders, except during the COVID-19 pandemic, we encourage, but do not require, directors to attend. All of our directors attended our most recent annual meeting of stockholders held on June 7, 2021.

Our board of directors has an audit committee, a compensation committee and a nominating and corporate governance committee, each of which has the composition and responsibilities described below. Members serve on these committees until their resignation or until otherwise determined by our board of directors.

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Audit Committee

The current members of our audit committee are Mr. Bancroft, Drs. Dahiyat and Yang. Mr. Bancroft is the chairman of the audit committee. The composition of our audit committee meets the requirements for independence under current Nasdaq listing standards and SEC rules and regulations. Each member of our audit committee meets the financial literacy requirements of Nasdaq. Our board of directors has determined that each of Mr. Bancroft and Dr. Dahiyat are audit committee financial experts, as that term is defined under the SEC rules implementing Section 407 of the Sarbanes-Oxley Act of 2002, and possesses financial sophistication, as defined under the rules of Nasdaq.

Our audit committee oversees our corporate accounting and financial reporting process and assists our board of directors in monitoring our financial systems. Our audit committee is comprised entirely of directors who are independent for purposes of serving on an audit committee. Our audit committee will also:

The audit committee met five times in 2021. The audit committee operates under a written charter that was adopted by our board of directors. A copy of the Audit Committee Charter is available on our website at ir.kodiak.com/corporate-governance/governance-overview.

Compensation Committee

The current members of our compensation committee are Dr. Baker and Mr. Bancroft and Mr. Profusek. Dr. Baker is the chairman of our compensation committee. The composition of our compensation committee meets the requirements for independence under current Nasdaq listing standards and SEC rules and regulations. Each member of the compensation committee is also a non-employee director, as defined pursuant to Rule 16b-3 promulgated under the Exchange Act.

Our compensation committee oversees our compensation policies, plans and benefits programs. The compensation committee will also:

Our compensation committee met seven times in 2021. The compensation committee operates under a written charter that was adopted by our board of directors. A copy of the Compensation Committee Charter is available on our website at ir.kodiak.com/corporate-governance/governance-overview. Pursuant to its charter, the compensation committee may form subcommittees and delegate to such subcommittees any power and authority the compensation committee deems appropriate, excluding any power or authority required by law, regulation or listing standard to be exercised by the compensation committee as a whole.

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Compensation Committee Interlocks and Insider Participation

The current members of our compensation committee are Dr. Baker and Mr. Bancroft and Mr. Profusek. None of the members of our compensation committee is or has been an officer or employee of ours. None of our executive officers currently serves, or in the past year has served, as a member of our board of directors or compensation committee (or other board committee performing equivalent functions or, in the absence of any such committee, the entire board of directors) of any entity that has one or more executive officers serving on our board of directors or compensation committee.

Nominating and Corporate Governance Committee

The current members of our nominating and corporate governance committee are Messrs. Profusek and Bancroft and Drs. Baker and Levy. The chairman of the nominating and corporate governance committee is Mr. Profusek. The composition of our nominating and corporate governance committee meets the requirements for independence under current Nasdaq listing standards and SEC rules and regulations.

Our nominating and corporate governance committee oversees and assists the board of directors in reviewing and recommending nominees for election as directors. The nominating and corporate governance committee will also:

Our nominating and corporate governance committee met five times in 2021. The nominating and corporate governance committee operates under a written charter that was adopted by our board of directors. A copy of the Nominating and Corporate Governance Committee Charter is available on our website at ir.kodiak.com/corporate-governance/governance-overview.

Our board of directors may from time to time establish other committees.

Considerations in Evaluating Director Nominees

The nominating and corporate governance committee uses a variety of methods for identifying and evaluating director nominees. In its evaluation of director candidates, the nominating and corporate governance committee will consider the current size and composition of the board of directors and the needs of the board of directors and the respective committees of the board of directors. Some of the qualifications that the nominating and corporate governance committee considers include, without limitation, issues of character, integrity, judgment, diversity, gender, age, independence, skills, education, expertise, business acumen, business experience, length of service, understanding of our company’s business and other commitments. Other than the foregoing, there are no stated minimum criteria for director nominees.

Although our board of directors does not maintain a specific policy with respect to board diversity, our board of directors believes that the board of directors should be a diverse body, and the nominating and corporate governance committee considers a broad range of backgrounds and experiences. In making determinations regarding nominations of directors, the nominating and corporate governance committee may take into account the benefits of diverse viewpoints. The nominating and corporate governance committee also considers these and other factors as it oversees the annual board of director and committee evaluations.

In 2021, the nominating and corporate governance committee placed significant emphasis on the identification, evaluation and recruitment of director candidates from diverse cultural backgrounds and from historically under-represented communities. Among other efforts, the committee commissioned a targeted search that was intended to identify director candidates from historically under-represented communities. Given the results of our Phase 2b/3 initial study in wet AMD, the nominating and corporate governance committee has recently delayed director recruiting efforts. The committee intends to re-engage on these efforts prior to the 2023 annual meeting.

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Board Diversity

Board Diversity Matrix

The Company and the Board are committed to continue seeking director candidates who would further increase the Board’s diversity. The Company considers diversity more broadly than as defined in Nasdaq standards. The Board currently has one Middle Eastern member, who is classified as “white” in the matrix below pursuant to Nasdaq standards.

For further details, please refer to the following matrix:

Stockholder Recommendations for Nominations to the Board of Directors

The nominating and corporate governance committee will consider candidates for directors recommended by stockholders so long as such recommendations comply with our bylaws and applicable laws. The committee will evaluate such recommendations in accordance with its charter, our bylaws and the regular nominee criteria described above. This process is designed to ensure that our board of directors includes members with diverse backgrounds, skills and experience, including appropriate financial and other expertise relevant to our business. Eligible stockholders wishing to recommend a candidate for nomination should contact our Corporate Secretary in writing. Such recommendations must include information about the candidate and the nominating stockholder, including with respect to any holdings of our securities, and a signed letter from the candidate confirming willingness to serve on our board of directors. The committee has discretion to decide which individuals to recommend for nomination as directors.

A stockholder of record can nominate a candidate directly for election to the board of directors by complying with the procedures in Section 2.4(ii) of our bylaws. Any eligible stockholder who wishes to submit a nomination should review the requirements in the bylaws on nominations by stockholders. Any nomination should be sent in writing to Kodiak Sciences

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Inc., Attention: Corporate Secretary, 1200 Page Mill Road, Palo Alto, CA 94304. For our 2023 annual meeting of stockholders, notice must be received by us no earlier than February 10, 2023, and no later than March 12, 2023. The notice must set forth the information required by Section 2.4(ii)(b) of our bylaws and otherwise must comply with applicable federal and state law.

Stockholder Communications with the Board of Directors

Stockholders wishing to communicate with a non-management member of the board of directors may do so by writing to such director, and mailing the correspondence to: Kodiak Sciences Inc., Attention: Corporate Secretary, 1200 Page Mill Road, Palo Alto, CA 94304. All such stockholder communications will be forwarded to the appropriate committee of the board of directors or non-management director.

Corporate Governance Guidelines and Code of Business Conduct and Ethics

Our board of directors has adopted Corporate Governance Guidelines. These guidelines address, among other items, the responsibilities of our directors, the structure and composition of our board of directors and corporate governance policies and standards applicable to us in general. In addition, our board of directors has adopted a Code of Business Conduct and Ethics that applies to all of our employees, officers and directors, including our Chief Executive Officer, Chief Financial Officer, and other executive and senior financial officers. The full text of our Corporate Governance Guidelines and Code of Business Conduct and Ethics is posted on the Corporate Governance portion of our website at ir.kodiak.com/corporate-governance/governance-overview. We will post amendments to our Corporate Governance Guidelines and Code of Business Conduct and Ethics or waivers of the same for directors and executive officers on the same website.

Risk Management

Our board of directors has an active role, as a whole and also at the committee level, in overseeing the management of our risks. Our board of directors is responsible for general oversight of risks and regular review of information regarding our risks, including risks arising out of our business generally. Our compensation committee is responsible for overseeing the management of risks relating to our executive compensation plans and arrangements. Our audit committee is responsible for overseeing the management of our risks relating to accounting matters and financial reporting. Our nominating and corporate governance committee is responsible for overseeing the management of our risks associated with the independence of our board of directors and potential conflicts of interest. While each committee is responsible for evaluating certain risks and overseeing the management of such risks, our entire board of directors is regularly informed through discussions with committee members about such risks. Our board of directors has received regular updates from the management team on the evolving COVID-19 pandemic and is involved in strategy decisions related to the impact of COVID-19 on our business. Our board of directors believes its administration of its risk oversight function has not affected the board of directors’ leadership structure.

Prohibitions on Hedging and Transactions Involving Equity or Derivative Securities

Our insider trading policy prohibits our non-employee directors, officers, employees, consultants, contractors and agents from among other things, short sales, hedging of stock ownership positions and transactions involving derivative securities relating to our common stock.

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Non-Employee Director Compensation

The following table provides information regarding compensation paid by us to our non-employee directors during 2021. Directors who are also our employees receive no additional compensation for their service as a director. During 2021 one director, Dr. Perlroth, our Chief Executive Officer and Chairman, was an employee. Dr. Perlroth’s compensation is discussed under the caption “Executive Compensation.”

Outside Director Compensation Policy

Our board of directors has approved a compensation policy for our non-employee directors (the “Outside Director Compensation Policy”). For purposes of the policy, our board of directors has classified each director into one of the two following categories: (1) an “employee director,” is a director who is employed by us; and (2) a “non-employee director,” is a director who is not an employee director. Only non-employee directors receive compensation under the Outside Director Compensation Policy. Non-employee directors receive compensation in the form of equity and cash under the Outside Director Compensation Policy, as described below. We believe our Outside Director Compensation Policy provides reasonable compensation to our non-employee directors that is appropriately aligned with our peers and is commensurate with the services and contributions of our non-employee directors. All directors will be reimbursed for expenses in their capacities as directors in accordance with our standard expense reimbursement policy.

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Our board of directors amended and restated the Outside Director Compensation Policy to increase the cash retainers paid to directors effective October 1, 2021. The board cash compensation was adjusted based on a competitive market analysis prepared by Compensia, Inc. and was modified as reflected in the table below. Director compensation is typically reviewed on an annual basis, and the Board expects to again review the Outside Director Compensation policy during 2022.

Equity Compensation

Initial Options. Subject to the limits on compensation paid to independent directors set forth in our 2018 Equity Incentive Plan (the “2018 Plan”), under the Outside Director Compensation Policy, each person who first becomes a non-employee director (other than a person that ceases to be an employee of ours but remains a director of ours) will be granted an initial option to purchase shares of our common stock with a grant date fair value of approximately $780,000 (which amount was increased to $905,800 effective October 1, 2021), which option will be effective on the first trading date on or after the date on which such person first becomes a non-employee director, whether through election by our stockholders or appointment by our board of directors to fill a vacancy. Each initial option will vest as to 1/3rd of the shares subject to the initial option on the one-year anniversary of the date of grant and as to 1/36th of the shares subject to the initial option each month thereafter, in each case, subject to continued service through each applicable vesting date.

Annual Options. Subject to the limits on compensation paid to independent directors set forth in the 2018 Plan, under the 2020 Restated Outside Director Compensation Policy, each non-employee director is granted an annual option on June 30^th of each year (or the preceding trading day, if June 30^th is not a trading day) to purchase shares of our common stock with a grant date fair value of approximately $390,000 (which amount was increased to $466,200 effective October 1, 2021), provided that such director has served on our board of directors for at least the preceding 12 months as of the grant date. Each non-employee director who has served on our board of directors for less than 12 months as of the grant date will receive a prorated award based on the number of days during the prior 12 months such director has served on our board of directors. Each annual option will fully vest on the earlier of (1) the one-year anniversary of the date of grant of the annual option and (2) the day prior to the date of the annual meeting of our stockholders that occurs in the fiscal year following the grant of such annual option, in each case, subject to continued service through the applicable vesting date.

In the event of a change in control of the Company, and unless otherwise agreed, each non-employee director will fully vest in his or her outstanding equity awards, including any initial option or annual option, provided that he or she continues to be a non-employee director through such date.

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PROPOSAL NO. 2

ADVISORY VOTE ON NAMED EXECUTIVE OFFICER COMPENSATION

Under Section 14A of the Exchange Act, the Company’s stockholders are entitled to vote to approve, on an advisory basis, the compensation of the Company’s named executive officers as disclosed in this proxy statement in accordance with SEC rules (a “say-on-pay” vote).

This vote is not intended to address any specific item of compensation, but rather the overall compensation of the Company’s named executive officers and the philosophy, policies and practices described in this proxy statement. The compensation of the Company’s named executive officers subject to the vote is disclosed in the Compensation Discussion and Analysis, the compensation tables and the related narrative disclosure contained in this proxy statement. As discussed in those disclosures, the Company believes that its compensation policies and decisions are designed to meet two objectives: (1) to attract and retain talented and skilled executives by paying for performance and (2) to align the compensation of our named executive officers with our stockholders through an appropriate mix of short-term and long-term compensation. Compensation of the Company’s named executive officers is designed to enable the Company to attract and retain talented and experienced executives to lead the Company successfully in a competitive environment.

Accordingly, our board of directors is asking the stockholders to indicate their support for the compensation of the Company’s named executive officers as described in this proxy statement by casting a non-binding advisory vote “FOR” the following resolution:

“RESOLVED, that the compensation paid to the Company’s named executive officers, as disclosed pursuant to Item 402 of Regulation S-K, including the Compensation Discussion and Analysis, compensation tables and narrative discussion that accompanies the compensation tables, is hereby APPROVED.”

Because the vote is advisory, it is not binding on the board of directors, the compensation committee or the Company. Nevertheless, the views expressed by the stockholders, whether through this vote or otherwise, are important to the board of directors and the compensation committee, and accordingly the board of directors and the compensation committee intend to consider the results of this vote in making determinations in the future regarding executive compensation arrangements.

Advisory approval of this proposal requires the vote of the holders of a majority of the shares of our common stock present in person or represented by proxy and entitled to vote on the matter at the annual meeting. Unless the board of directors decides to modify its policy regarding the frequency of soliciting advisory votes on the compensation of the Company’s named executive officers, the next scheduled say-on-pay vote will be at the 2023 Annual Meeting of Stockholders.

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EXECUTIVE OFFICERS

The following table sets forth the names and positions of our executive officers, including their ages as of April 8, 2022. Officers are elected by the board of directors to hold office until their successors are elected and qualified.

There are no family relationships among any of the directors or executive officers.

Executive Officers

Victor Perlroth, M.D.. See “Board of Directors and Corporate Governance — Continuing Directors” for Dr. Perlroth’s biographical information.”

Jason Ehrlich, M.D., Ph.D. joined Kodiak as our Chief Medical Officer and Chief Development Officer in September 2018. Dr. Ehrlich, an ophthalmologist, is passionate about improving outcomes for patients with vision-threatening eye diseases through the development of innovative medicines. He is internationally recognized for his leadership and expertise in ophthalmic drug development. Prior to joining Kodiak, Dr. Ehrlich served in an executive capacity as Global Head, Clinical Ophthalmology at Genentech, a member of the Roche Group of pharmaceutical companies. In roles of increasing responsibility at Genentech and Roche from July 2008 to August 2018, Dr. Ehrlich’s efforts as lead clinician for Lucentis in diabetic eye disease resulted in a unanimous FDA Advisory Committee vote and the first-ever FDA approval of an intraocular drug for diabetic macular edema. He then championed further expanding the Lucentis labeling into all forms of diabetic retinopathy, resulting in another first-ever FDA approval. Dr. Ehrlich guided the integration of the ophthalmic drug delivery company ForSIGHT VISION4 into Genentech/Roche after its acquisition, including oversight of the successful Phase II study of the ranibizumab Port Delivery System. In his work, Dr. Ehrlich has participated in or overseen numerous supplemental biologics license applications and both FDA and European health authority interactions. He led the global development of lampalizumab towards an innovative new therapy for the dry form of age-related macular degeneration, including design and execution of the pivotal Phase III program that included over 1,800 patients, over 275 sites, and more than 20 countries. He also oversaw his team’s effort to secure FDA approvals of Lucentis in its prefilled syringe and for choroidal neovascularization due to pathologic myopia, and the successful transition to global Phase III development of faricimab, a novel bispecific antibody for retinal vascular disease. Dr. Ehrlich completed his Ophthalmology residency at Stanford University School of Medicine, earned his M.D. and Ph.D. degrees from Stanford through the NIH-funded Medical Scientist Training Program, and received his A.B. in Molecular Biology summa cum laude from Princeton University.

John A. Borgeson is our Senior Vice President, Chief Financial Officer and Secretary and has served in this position since January 2016. Mr. Borgeson brings over 25 years of pharmaceutical industry experience in finance, strategy and operations on a global scale. From January 2013 until December 2015, Mr. Borgeson led finance for a variety of private biotech companies, including Labrys Biologics, Inc., which was acquired by Teva Pharmaceuticals. Previously, Mr. Borgeson was a Vice President of Finance at Pfizer Inc. and a member of Pfizer’s Global Finance and Business Operations Leadership Team. Mr. Borgeson’s roles at Pfizer included finance head for Pfizer’s biotherapeutics and bioinnovation group and corporate tax executive with responsibility for the United States and Europe. Mr. Borgeson started his career as an auditor with Ernst & Young and is a certified public accountant (inactive). He has an M.B.A. from R.I.T. and an undergraduate degree from the School of Management at the University at Buffalo (S.U.N.Y.).

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COMPENSATION COMMITTEE REPORT

The Compensation Committee has reviewed and discussed with management the Compensation Discussion and Analysis (“CD&A”) contained in this proxy statement. Based on this review and discussion, the Compensation Committee has recommended to the Board of Directors that the CD&A be included in this proxy statement and incorporated into the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2021.

Felix J. Baker (Chairperson)

Charles A. Bancroft

Robert A. Profusek

The material in this report is not “soliciting material,” is being furnished and shall not be deemed “filed” with the Securities and Exchange Commission (the “Commission” or “SEC”) and is not to be incorporated by reference in any of our filing under the Securities Act of 1933, as amended (the “Securities Act”), or the Securities Exchange Act of 1934, as amended (the “Exchange Act”), whether made before or after the date hereof and irrespective of any general incorporation language in any such filing.

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EXECUTIVE COMPENSATION

Compensation Discussion and Analysis

Overview

This Compensation Discussion and Analysis discusses our executive compensation program and policies and how and why our compensation committee arrived at specific compensation decisions for our “named executive officers” (also referred to herein as our “NEOs”) consisting of the following individuals, who were the only individuals serving as our executive officers at the end of 2021:

The important features of our executive compensation program include the following:

Under the 2021 LTPIP, options are earned primarily based on stock price appreciation between $200 and $800 per share. At each level, our stock price has to meet or exceed the corresponding stock price goal for a period of 90 consecutive trading days.

Up to 35% of the options can also be earned through the achievement of important operational milestones to the extent that those options have not yet been earned through stock appreciation. Specifically, up to 25% of the LTPIP options could be earned on approval by the U.S. Food and Drug Administration of a Biologics License

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Application in respect of a first, second and third major indication (RVO, DME and/or wAMD), and up to 10% may be earned based on attainment of sales of at least $2.5 billion in a completed fiscal year.

Even after they are earned, LTPIP options require sustained NEO service to the Company.

If LTPIP options are earned as described above, they remain subject to additional time-based vesting. Once earned, they would vest in substantially equal monthly installments over the period of time remaining in the seven-year performance period for the LTPIP.

Our NEOs will not realize any value from their LTPIP options unless and until our stock price increases dramatically.

All of the LTPIP options granted to our NEOs have an exercise price of $88.21 per share. Accordingly, LTPIP options that are actually earned and subsequently vest as described above will provide no realizable value to our NEOs unless and until our stock price exceeds $88.21 per share.

The LTPIP required our NEOs to forgo a portion of their annual equity awards for seven years.

In order to participate in the LTPIP, each NEO had to “opt-in” and agree to forgo a corresponding percentage of annual equity incentive awards for the next seven years. As a result, Dr. Perlroth’s 2021 annual incentive awards were reduced by 75%, and Mr. Borgeson’s and Dr. Ehrlich’s 2021 annual incentive awards were reduced by 50%. Each NEO’s annual awards over the next six years will also be reduced by the same respective percentages.

As a result, we estimated at the time of approval and continue to believe that, unless our stock price increases above $400 per share and stays there for a 90 consecutive trading day period, our NEOs would do worse financially by participating in the LTPIP than they would have done, had the Company instead continued to provide annual equity grants targeting more or less the average rewards peer companies give their management.

Further details of the plan can be found in our Proxy Statement filed with the SEC on September 13, 2021, available at www.sec.gov/Archives/edgar/data/1468748/000156459021047762/kod-def14a_20211013.htm.

Overview of Our Executive Compensation Program

Objectives, Philosophy and Elements of Compensation

The overall objectives of our executive compensation program and policies are to:

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Our executive compensation program generally consists of, and is intended to strike a balance among, three principal components: base salary, annual bonuses and long-term incentive compensation in the form of equity awards. We also provide our named executive officers with severance and change-in-control payments and benefits, as well as other benefits available to all our employees, including retirement benefits under our Section 401(k) plan and participation in our employee health and welfare benefit plans. The following chart summarizes the objectives and key features of the three primary elements of compensation.

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In evaluating our executive compensation policies and programs, as well as the short-term and long-term value of our executive compensation plans, we consider both the performance and skills of each of our named executive officers, as well as the compensation paid to executives in similar companies with similar responsibilities. We focus on providing a competitive compensation package which provides significant short-term and long-term incentives for the achievement of measurable corporate objectives. We believe that this approach provides an appropriate blend of short-term and long-term incentives to maximize stockholder value.

In determining the aggregate size of equity grants in any given year, the compensation committee (or our board of directors in the case of our Chief Executive Officer) generally considers the same factors described above under “Base Salary” with respect to performance during the prior fiscal year, as well as the criticality of the executive officer to the long-term achievement of corporate goals. The compensation committee also considers the impact of dilution by reviewing overall share utilization and usage.

We do not have any formal policies for allocating compensation among base salary, annual bonus awards and equity awards, short-term and long-term compensation or among cash and non-cash compensation. Instead, the compensation committee uses its judgment to establish a total compensation package for each named executive officer that is a mix of current, short-term and long-term incentive compensation, and cash and non-cash compensation, that it believes appropriate to achieve the goals of our executive compensation program and our corporate objectives. However, a significant portion of the named executive officers’ target total direct compensation is comprised of target bonus opportunities and long-term equity awards, in order to align the named executive officers’ incentives with the interests of our stockholders and our corporate objectives.

In making executive compensation decisions, the compensation committee generally considers each named executive officer’s target total direct compensation, which consists of base salary, target bonus opportunity, which together with base salary we refer to as target total cash compensation and long-term equity awards (valued based on an approximation of grant date fair value).

Role of the Compensation Committee and Executive Officers in Setting Executive Compensation

The compensation committee reviews and oversees our executive compensation program, policies and plans, and it reviews and determines the compensation to be paid to our named executive officers. In making its executive compensation determinations, the compensation committee considers recommendations from our Chief Executive Officer for our named executive officers other than himself. In making his recommendations, our Chief Executive Officer receives internal input from our management team and has access to various third-party compensation surveys and compensation data provided by the compensation consultant to the compensation committee, as described below. While our Chief Executive Officer discusses his recommendations for the other named executive officers with the compensation committee, he is not present and does not participate in the deliberations concerning, or the determination of, his own compensation. In addition to our Chief Executive Officer, our Chief Financial Officer, as well as members of our management team may also attend compensation committee meetings from time to time and may take part in

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discussions of executive compensation. The compensation committee discusses and makes final determinations with respect to executive compensation matters without any named executive officers present (other than our Chief Executive Officer as described above). The compensation committee makes recommendations to the full board of directors with respect to its determination of compensation and benefits to our CEO.

The compensation committee meets periodically throughout the year to manage and evaluate our executive compensation program, and generally determines the principal components of compensation (base salary, annual bonus and equity awards) for our named executive officers on an annual basis; however, decisions may occur during the year for new hires, promotions or other special circumstances as our compensation committee determines appropriate. The compensation committee does not delegate its authority to approve named executive officer compensation. The compensation committee does not maintain a formal policy for the timing of equity awards to our named executive officers; awards are generally approved at a meeting of the compensation committee approximately midway through each year.

Role of Our Compensation Consultant

The compensation committee has the authority to retain compensation consultants to assist it in fulfilling its responsibilities. For purposes of evaluating 2021 compensation for each of our named executive officers and making 2021 compensation decisions, the compensation committee retained Compensia, a national compensation consulting firm, to assist the compensation committee in reviewing our executive compensation program and to ensure that our compensation programs remain competitive in attracting and retaining talented executives.

During 2021, Compensia assisted the compensation committee in developing a group of peer companies to use as a reference in making compensation decisions, developing the compensation committee’s executive pay philosophy, evaluating current pay practices and considering different compensation programs and compensation and corporate governance best practices. As described further below, Compensia also prepared an analysis of our compensation practices with respect to base salaries, annual bonuses and equity awards against competitive market practices. Compensia reports directly to the compensation committee, which maintains the authority to direct Compensia’s work and engagement, and advises the compensation committee and our human resources department from time to time. Compensia interacts with management to gain access to Company information that is required to perform its services and to understand the culture and policies of our organization. The compensation committee and Compensia meet in executive session with no members of management present as needed to address various compensation matters, including deliberations regarding our Chief Executive Officer’s compensation.

The compensation committee also utilized the services of Infinite Equity, an equity compensation advisory firm, together with Compensia to assist in the design and implementation of the 2021 LTPIP.

Our compensation committee has assessed the independence of Compensia pursuant to the applicable Nasdaq listing standards and SEC rules, and concluded that Compensia is independent and that the work of Compensia has raised no conflict of interest that would prevent Compensia from independently representing the compensation committee.

Use of Competitive Market Compensation Data

We aim to attract and retain the most highly qualified executive officers in an extremely competitive market. Accordingly, the compensation committee believes that it is important when making its compensation decisions to be informed as to the current practices of comparable public companies with which we compete for top talent. To this end, the compensation committee reviews market data for each named executive officer’s position, compiled by Compensia as described below, including information relating to the compensation for executive officers in the biopharmaceutical industry.

In developing a proposed list of our peer group companies to be used in connection with making compensation decisions for 2021, Compensia examined our compensation philosophy and selected companies that would be appropriate peers based on geography, industry focus, employee size, stockholder base, stage of development and market capitalization. Specifically, companies were selected in June 2020 with the following parameters:

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Based on these criteria, for 2021, Compensia recommended, and our compensation committee approved the following peer group for use analyzing 2021 compensation:

Using the peer companies listed above, Compensia prepared, and the compensation committee reviewed, a range of market data reference points (generally at the 25^th, 50^th, 60^th and 75^th percentiles of the market data) with respect to base salary, annual bonuses, equity awards (valued based on an approximation of grant date fair value and as an ownership percentage), target total cash compensation (including base salary and the target annual bonus) and target total direct compensation (total target cash compensation and equity compensation).

The compensation committee reviews these market data reference points and structures each component of compensation, as well as target total direct compensation to be competitive with the market. However, the market data is only one of the factors that the compensation committee considers in making compensation decisions and therefore individual named executive officer compensation may fall above or below these general guidelines.

Factors Used in Determining Executive Compensation

Our compensation committee sets the compensation of our named executive officers at levels it determines to be competitive and appropriate for each named executive officer, using the professional experience and judgment of compensation committee members. Pay decisions are not made by use of a formulaic approach or benchmark; the compensation committee believes executive pay decisions require consideration of a multitude of relevant factors which may vary from year to year. In making executive compensation decisions, the compensation committee generally takes into consideration the following factors:

2021 Advisory Vote on Executive Compensation

Our compensation committee reviewed the results of the 2021 stockholder advisory vote on NEO compensation and incorporated the results as one of the many factors considered in connection with the discharge of its responsibilities. Because a substantial majority (approximately 99%) of the votes cast at the 2021 annual meeting of stockholders approved the compensation of our named executive officers described in our 2021 proxy statement. Accordingly, our compensation committee did not implement changes to our executive compensation program as a direct result of the stockholder advisory vote.

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2021 Executive Compensation Program

Annual Base Salary

In reviewing and adjusting base salaries in June 2021, the compensation committee first assessed current base salary levels against the competitive market analysis prepared by Compensia and determined that certain of our named executive officers trailed the 50^th percentile of our 2021 compensation peer group. Given the strong performance of the Company at that time, the compensation committee determined an increase to the market 50^th percentile was appropriate for these named executive officers, and necessary to remain competitive with companies with whom we compete and a smaller increase was necessary and appropriate for those named executive officers who were closer to the 50^th percentile as a merit increase for their efforts towards our strong performance at the time. Accordingly, the compensation committee increased the base salaries of the named executive officers to the amounts necessary to set their 2021 base salaries at approximately the 50^th percentile of the competitive market data.

Annual Bonuses

Our compensation committee approved our annual bonus program for 2021 in early 2021. The 2021 annual bonus each named executive officer was eligible to receive was based on the individual’s target bonus, calculated as a percentage of base salary, or target bonus percentage, and the extent to which we achieved the corporate objectives that our board of directors established for the year. There is no specified minimum or maximum bonus percentage or amount established for the named executive officers.

Specifically, the compensation committee determined that the 2021 target bonus percentage should be 45% for all NEOs other than Dr. Perlroth (i.e., 45% for Mr. Borgeson and Dr. Ehrlich). The compensation committee’s decision regarding 2021 target bonus percentages for our NEOs was based on a review of a competitive market analysis prepared by Compensia, as well as an assessment of target bonus percentages appropriate to align us competitively with our 2021 compensation peer group. Based on their analysis, the target bonus percentage for our NEOs was increased from 40% in 2020 to 45% in 2021.

Further, a review of the competitive market analysis prepared by Compensia indicated that with a target bonus percentage of 60%, Dr. Perlroth’s target total cash compensation fell below the 50^th percentile of the competitive market data. In order to better align his target total cash compensation with those of the chief executive officers of the companies in our 2021 compensation peer group and in recognition of his greater role in determining the course of, and ability to influence the future of the Company, as well as the critical importance of his leadership to the Company’s achievement of its 2021 business and financial objectives, the compensation committee approved an increase to Dr. Perlroth’s 2021 target bonus percentage to 65%.

In connection with establishing the 2021 annual bonus program, the compensation committee approved the corporate goals identified in the table below. In selecting these goals, the compensation committee believed that they were appropriate drivers for our business, as they supported KSI-301 clinical development and advanced our research and discovery pipeline, all while maintaining a solid financial position, which together, would enhance stockholder value. At the time the 2021 corporate goals were set, the compensation committee and management believed that such goals were challenging and achieving them would require not only continued strong research and product development success, as well as prudent fiscal and legal management, but also a high level of effort and execution on the part of our named executive officers.

The compensation committee also applied a performance weighting to each goal relative to the overall performance of the Company to reflect the prioritization of key business objectives in the table below. No specific individual objectives were established for any of our named executive officers for 2021, so our named executive officers’ bonuses were entirely dependent on the achievement of our corporate goals.

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During 2021, management reported regularly to the compensation committee on the status of our performance against these goals and in January 2022, the compensation committee evaluated our performance in relation to the 2021 goals.

After consideration of such performance, the compensation committee concluded that 2021 was a year of meaningful accomplishments during which the Company achieved each of our pre-established corporate goals, as further described in the table below. The table below describes each corporate goal as well as the achievements related to each goal.

Based on our performance relative to the 2021 corporate goals, the compensation committee awarded each of our named executive officers an annual bonus equal to 125% of his target bonus opportunity for 2021, as shown in the table below:

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Long-Term Incentives

During the fall of 2020, our board of directors began discussions about incentivizing our NEOs to lead the Company through the next phase of the Company’s development. In August 2021, following more than ten months of careful analysis led by the compensation committee, and with the participation of every independent board member, we proposed that stockholders consider the LTPIP.

As a result, in 2021, the Company utilized three components of employee equity incentive compensation:

Both the 2021 LTPIP and the performance option awards granted during 2021 embody the concept of pay-for-performance as the awards vest only upon achievement of ambitious stock price or operational goals. Further, we believe the depressed market value of our common stock following the release of top-line results from our initial Phase 2b/3 Study of KSI-301 in patients with neovascular wet aged-related macular degeneration provides an even higher hurdle for achieving vesting in the 2021 LTPIP. For example, the closing price per share of our common stock declined from $50.35 on February 22, 2022 to $9.86 on February 23, 2022, the day on which the Phase 2b/3 top-line data was announced.

Details on each component of our long-term incentives for our named executive officers are described below.

(a) 2021 LTPIP

The 2021 LTPIP was designed to be a long-term, pay-for-performance, equity incentive plan that would further align the interests of management and other eligible employees with the creation of substantial long-term value for our stockholders. Our NEOs and other eligible employees at or above grade level 10 were provided a one-time opportunity to “opt-in” or “buy-in” to the 2021 LTPIP, via a one-time election, if they so elected, they agreed to forgo up to 75% of their annual performance option awards and service-based annual equity incentive awards for the next seven years, and instead received a one-time grant of performance-based stock options (the “2021 LTPIP Stock Option Grants”) that could potentially provide three times more value than the forgone annual equity awards.

The 2021 LTPIP has a “break-even” point of approximately $400 per share, meaning that unless our stock price increases to above $400 per share and stays there for a 90 consecutive trading day period, we estimate that participating employees would do worse financially by participating in the 2021 LTPIP than they would have done had the compensation committee instead continued to grant annual equity awards targeting approximately the average rewards the companies in our compensation peer group grant their management. A $400 per share price for our common stock corresponds to approximately $25 billion market capitalization, which would result in significant value creation for our stockholders.

On August 12, 2021, the compensation committee and our board of directors approved grants under the 2021 LTPIP as summarized in table a1 below.

These awards were conditionally granted subject to stockholder approval at an exercise price of $88.21, the fair market value per share of our common stock on the date of grant. On October 13, 2021, at a special meeting of stockholders, our stockholders approved the 2021 LTPIP with approximately 75% of the votes cast voting ‘FOR’ the program, excluding the votes of LTPIP participants.

Prior to deciding to submitting the LTPIP to stockholders, members of the compensation committee consulted with several substantial stockholders. While opinions varied, the stockholders expressed a general consensus for a long-term performance-based equity plan that would replace in substantial part annual equity awards.

Upon stockholder approval of the 2021 LTPIP, the 2021 LTPIP Stock Option Grants became effective and each 2021 LTPIP participant’s previously granted 2021 performance option awards and service-based annual equity awards were decreased in accordance with the percentage of their 2021 performance option awards and service-based annual equity awards they agreed to forego in exchange for their 2021 LTPIP Stock Option Grant.

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Table a1 below summarizes the final seven-year 2021 LTPIP Stock Option Grants and the percentage of the 2021 performance option awards and service-based annual equity incentive awards each NEOs elected to waive.

Table a1: Summary of NEO ‘2021 LTPIP’ Stock Option Grants

Award Vesting/Milestones:

Shares of our common stock underlying the 2021 LTPIP Stock Option Grants are earned based on the achievement of the performance-based requirement and/or certain operational milestones, as described below. Upon being earned based on performance, the shares of our common stock then generally vest based on continued service with the Company following the date earned and through the end of the seven-year performance period.

Performance-Based Requirement:

The performance-based requirement consists of seven tranches of stock price goals. The first tranche requires that our common stock price per share reach or exceed $200, with each tranche thereafter requiring a $100 incremental increase up to $800 for the last tranche to be earned. A percentage of the shares of our common stock underlying a 2021 LTPIP Stock Option Grant will be earned based on the stock price meeting or exceeding the corresponding stock price goal for a period of 90 consecutive trading days during the seven-year performance period, as follows:

Operational Milestones:

Up to 35% of the shares of our common stock underlying the 2021 LTPIP Stock Option Grants may also be earned based on our achievement of certain operational milestones during the seven-year performance period. An NEO may earn up to 25% of his total award based on approval by the U.S. Food and Drug Administration of a Biologics License Application (or “BLA”) in respect of a first, second, and third major indication (RVO, DME and/or wAMD). In addition, an NEO may earn up to 10% of his total award based on our attainment of sales of at least $2.5 billion in a completed fiscal year.

The maximum percentage of shares of our common stock that can be earned based on the attainment of the operational milestones is as follows:

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The portion of a 2021 LTPIP Stock Option Grant that may be earned based on attainment of an operational milestone is inclusive of, and not in addition to, any portion of the award that may be earned based on the attainment of the performance-based requirement. Therefore, to the extent a portion of a 2021 LTPIP Stock Option Grant is earned based on the attainment of an operational milestone, the subsequent tranche(s) of the award that is eligible to be earned based on the performance-based requirement will be reduced by the excess, if any, of the number of shares earned over the cumulative earning percentage provided for in the performance-based requirement.

Neither a performance-based requirement nor an operational milestone was achieved as of December 31, 2021.

Service-Based Requirement

Shares of our common stock earned based on attainment of the performance-based requirement, or upon achieving an operational milestone, are subject to additional time-based vesting and will vest in substantially equal monthly installments over the period of time remaining in the seven-year performance period, on the first day of each complete calendar month following the date on which the applicable stock price goal, or operational milestone, was attained.

Further information on the 2021 LTPIP can be found in our definitive proxy statement dated September 13, 2021 for our Special Meeting of Stockholders held on October 13, 2021.

(b) Performance Option Awards

Special Performance Option Award for 2020

As previously disclosed, in February 2021, the compensation committee approved a special performance-based stock option grant for our named executive officers (as well as other employees) as a result of the Company’s extraordinary performance in 2020. These performance-based option awards are linked to metrics that are aligned with our corporate strategy and which are designed to build value for our stockholders. Specifically, the metrics are focused on completion of our KSI-301 clinical development. The options will vest over four years if, and only if, the enrollment of the last patient in both of the DME pivotal trials, GLEAM and GLIMMER occurs before December 31, 2022. The enrollment criteria was met in February 2022, at which time 25% of the award vested. The remaining options will vest over 36 months.

Pursuant to FASB ASC Topic 718, these performance-based stock options are reported in our 2021 Summary Compensation Table and 2021 Grants of Plan-Based Awards Table for their year of grant, i.e., 2021, even though the award relates to services performed in 2020.

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Performance-Based Option Grant

In August 2021, the compensation committee approved an special performance-based stock option grant for our named executive officers which represents the difference between the 50th and 75th percentile of the market data as reflected in the competitive market analysis prepared by Compensia. These performance-based stock options are linked to metrics that are aligned with our corporate strategy and which are designed to build value for our stockholders. A summary of the performance criteria metrics is as follows:

The options will vest over four years if, and only upon the acceptance by the FDA of a BLA for KSI-301 with the number of stock options earned dependent on the relative total stock return percentage as compared to the Russell 2000 at the end of the three-year performance period.

Table b1 below shows the initial performance-based stock option grants approved by the compensation committee for each of our named executive officers and the final grants, after giving effect to each individual’s 2021 LTPIP election to forego a portion of the award.

Table b1: Summary of NEO 2021 Performance Option Awards

(c) Service-Based Annual Equity Incentive Awards

In determining the annual service-based equity awards for our named executive officers, the compensation committee took into consideration both the practices of the companies in our compensation peer group and competitive market data provided by its compensation consultant. The compensation committee determined that the 2021 equity mix should remain the same as the 2020 equity mix. Consequently, for Dr. Perlroth, the compensation committee decided to deliver 100% of the value of his annual equity award in the form of stock options. For our other named executive officers, the compensation committee decided to deliver approximately 65% of the value of each named executive officer’s annual equity award in the form of stock options and 35% of the value in the form of RSU awards.

In determining the value of these equity awards, the compensation committee considered a competitive market analysis of long-term incentive compensation prepared by Compensia using the 60th percentile of the competitive market data as

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the starting point and then adjusting the value of the annual equity awards as it deemed appropriate in its discretion. These stock options vest monthly over a four-year period and the RSU awards vest in four equal annual installments, in each case subject to the named executive officer’s continued service with us through the applicable vesting date.

Table c1 below shows the initial 2021 annual service-based equity awards approved by the compensation committee for each of our named executive officers and the final awards, after giving effect to each individual’s 2021 LTPIP election to forego a portion of the awards.

Table c1: Summary of NEO 2021 annual stock option and RSU grants

Table d1 below summarizes the initial equity awards approved in August 2021 by the compensation committee and then the final awards after giving effect to each named executive officer’s 2021 LTPIP election to forgo a portion of the awards.

Table d1: summary of 2021 NEO Equity Awards:

Timing of Equity Award

Annual grants of equity awards to our named executive officers are generally determined and approved at compensation committee meetings, with such meeting date typically serving as the grant date. However, the compensation committee may sometimes approve the grant of equity awards to our named executive officers and other employees in advance of its next scheduled meeting, either at a special meeting or by unanimous written consent, in connection with certain new hires, promotions and other circumstances where the compensation committee deems it appropriate to grant such awards. The grant dates for these equity awards are typically the same date that a newly hired executive officer begins employment or the effective date of an executive officer’s promotion, as applicable. All stock options are granted with an exercise price that is not less than the closing price of our common stock on the grant date. We have no plan or practice to time option grants in coordination with the release of non-public information, and we do not time the release of non-public information to affect the value of executive compensation.

Other Features of Our Executive Compensation Program

Employment Agreements with Our Named Executive Officers

We entered into employment agreements with each of our named executive officers upon their initial commencement of employment with us. Each of our named executive officers is employed “at will” and may be terminated at any time for any reason. All of our named executive officers are eligible for severance and change in control payments and benefits pursuant to the terms of their respective employment agreements, the terms of which are described below under “Severance and Change in Control Payments and Benefits” and “Potential Payments upon Termination or Change in Control.”

Severance and Change in Control Payments and Benefits

The employment agreements with our named executive officers provide for certain severance payments and benefits (cash payments, payments for benefits continuation and equity acceleration) upon a termination of employment without

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cause or resignation for good reason, either outside of or within the three months prior to or 24 months following a corporate transaction. We do not provide any excise or other tax reimbursement (including “gross up”) payments in connection with severance or change in control transactions. Our compensation committee periodically reviews the severance payments and benefits that we provide, including by reference to market data, to ensure that the payments and benefits remain appropriately structured and at reasonable levels. The compensation committee believes that that severance protection payments and benefits are necessary to provide stability among our named executive officers, serve to focus our named executive officers on our business operations, and avoid distractions in connection with a potential change in control transaction or period of uncertainty. A more detailed description of the severance payments and benefits for each of our named executive officers is provided below under “Potential Payments upon Termination or Change in Control.”

Regardless of the manner in which a named executive officer’s service terminates, the named executive officer is entitled to receive amounts earned during his term of service, including base salary earned and unused vacation pay.

Section 401(k) Plan and Health Benefits

We maintain a Section 401(k) retirement plan that provides eligible employees with an opportunity to save for retirement on a tax-advantaged basis. Eligible employees, including our named executive officers, are able to defer eligible compensation subject to applicable annual limits under the Internal Revenue Code of 1986, as amended (the “Code”). All participants’ interests in their deferrals are 100% vested when contributed. In 2019, we amended the Section 401(k) Plan to provide employer matching contributions of 100% of employee contributions up to a maximum of 50% of the individual maximum contribution limit allowed under the Internal Revenue Service rules. Company matching contributions for the Section 401(k) plan became effective January 1, 2019. Pre-tax contributions are allocated to each participant’s individual account and are then invested in selected investment alternatives according to the participants’ directions. The Section 401(k) plan is intended to qualify under Sections 401(a) and 501(a) of the Code. As a tax-qualified retirement plan, contributions to the Section 401(k) plan and earnings on those contributions are generally not taxable to the employees until distributed from the Section 401(k) plan, and all contributions are deductible by us when made. The Section 401(k) plan also permits contributions to be made on a post-tax basis for those employees participating in the Roth 401(k) plan component.

In addition, we provide health benefits to our named executive officers, on the same basis as to all of our full-time employees. These benefits include, but are not limited to, medical, dental, vision, group life, disability and accidental death and dismemberment insurance plans.

Perquisites and Other Personal Benefits

We generally do not offer perquisites or personal benefits to our named executive officer, although we may from time to time provide reasonable relocation, signing bonuses, retention bonuses, or other benefits to our named executive officers as our compensation committee determines appropriate. In 2021, we paid Dr. Ehrlich a monthly housing and travel allowance pursuant to the terms of his employment agreement, as reported in the “2021 Summary Compensation Table.” The compensation committee determined that such benefits were reasonable and necessary component of Dr. Ehrlich’s compensation.

Accounting and Tax Considerations

Under Financial Accounting Standard Board ASC Topic 718, or ASC 718, the Company is 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.

Under Section 162(m) of the Code (“Section 162(m)”), compensation paid to each of the Company’s “covered employees” that exceeds $1 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 our named executive officers in a manner consistent with the goals of our executive

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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 Recovery (“Clawback”) Policy

As a public company, if we are required to restate our financial results due to our material noncompliance with any financial reporting requirements under the federal securities laws as a result of misconduct, the Chief Executive Officer and Chief Financial Officer may be legally required to reimburse our Company for any bonus or other incentive-based or equity-based compensation they receive in accordance with the provisions of section 304 of the Sarbanes-Oxley Act of 2002. In addition, we intend to implement a Dodd-Frank Wall Street Reform and Consumer Protection Act-compliant clawback policy as soon as, and to the extent that, the requirements of such clawbacks are finalized by the SEC.

Risk Assessment Concerning Compensation Practices and Policies

With the assistance of the compensation committee’s compensation consultant and the Company’s outside legal counsel, in April 2021, the compensation committee reviewed the Company’s compensation policies and practices to assess whether they encourage employees to take excessive or inappropriate risks. After reviewing and assessing the Company’s compensation philosophy, policies and practices, including the mix of fixed and variable, short-term and long-term incentives and overall compensation, incentive plan structures, and risk mitigation features, and oversight of, each plan and arrangement, the compensation committee determined that any risks arising from our compensation policies and practices for our employees are not reasonably likely to have a material adverse effect on our Company as a whole. The compensation committee believes that the mix and design of the elements of executive compensation do not encourage management to assume excessive or inappropriate risks; the mix of short-term compensation (in the form of base salary and annual bonus, if any, which is based on the achievement of multiple performance goals), and long-term compensation (in the form of stock options and RSU awards) prevents undue focus on short-term results and helps align the interests of the Company’s named executive officers with the interests of our stockholders. In addition, the Company’s insider trading policy and related policies helps protect against short-term decision making.

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2021 Summary Compensation Table

The following table provides information regarding the compensation of our named executive officers during 2021, 2020 and 2019. Note that the large amounts for 2021 appearing in the “Option Awards” column of the summary compensation table reflect principally special one-time LTPIP awards calculated by reference to awards only a seven-year period (plus annual grants). See the description of LTPIP awards, which represent most of the 2021 awards, under “2021 Executive Compensation Program — Long-Term Incentives” above.

For Dr. Perlroth, the maximum potential value of the 2021 Aug PSO on the grant date is $4,149,000, of which 75%, or $3,111,750, has been forgone for the options granted under the 2021 LTPIP.

For Mr. Borgeson, the maximum potential value of the 2021 Aug PSO on the grant date is $2,074,500, of which 50%, or $1,037,250, has been forgone for the options granted under the 2021 LTPIP.

For Dr. Ehrlich, the maximum potential value of the 2021 Aug PSO on the grant date is $2,074,500, of which 50%, or $1,037,250, has been forgone for the options granted under the 2021 LTPIP.

Dr. Perlroth, Mr. Borgeson and Dr. Ehrlich elected to forgo 75%, 50% and 50% of their options for the seven years beginning in 2021 in favor of options granted under the 2021 LTPIP.

The incremental fair value of the options granted under the 2021 LTPIP for Dr. Perlroth, Mr. Borgeson and Dr. Ehrlich were $95,546,310, $22,192,925 and $22,192,925, respectively.

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Supplemental Summary Compensation Table

To supplement the reported compensation disclosed in the Summary Compensation Table, we have included the following supplemental table, which we believe provides a useful alternative representation of 2021 compensation. This supplemental table is not a substitute for reported compensation in the Summary Compensation Table, is shown for informational purposes only and is not presented in accordance with SEC requirements.

In accordance with SEC proxy disclosure rules, the estimated fair value of the stock options shown in the 2021 Summary Compensation Table is based on market conditions that existed at the time the stock options were granted. For informational purposes, as of April 22, 2022, the fair value of the options granted under the 2021 LTPIP to Dr. Perlroth, Mr. Borgeson and Dr. Ehrlich was substantially lower at $1,085,829, $249,348 and $249,348, respectively, reflecting the reduction in the per share trading price of the Company’s common stock following the release of data from the Company’s initial Phase 2b/3 study in wet AMD.

This table reflects the total compensation as reported in the above Summary Compensation Table for 2021, excluding (i) the 2021 LTPIP Stock Option Grants, which were one-time grants that are not otherwise part of our regular executive compensation program and which are intended to incentivize performance over a seven-year period, (ii) the portion of each 2021 August Equity Award (as defined in footnote 1 to the table below) that was forfeited based on each named executive officer’s LTPIP election and (iii) the special performance-based options granted in February 2021 and which are reported in the Summary Compensation Table for 2021 due to the technical requirement that these awards be reported in their year of grant.

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2021 Grants of Plan-Based Awards Table

The following table provides information regarding the grants of plan-based awards to our named executive officers for the year ended December 31, 2021.