Assuming when you say 'vest' you actually mean exercise. It's sounds like an investor doesn't believe you will execute without the extra incentive. I'm not a fan of tranches of any form, but sometimes you gotta do what you gotta do. Also, you didn't mention the strike price, so no way to know if this is a good deal or not. My advice is to ensure you have an experienced tech lawyer, and discuss it with them. They will have the experience to tell you what is normal and acceptable.
100% of investments I've been involved in (30+) over the past 6 years have never included these kind of terms. As Danny mentioned, using a "Tranche" approach to progress / investment is usually a clear indication that the investors don't trust the teams ability to execute.
Risk capital requires risk, and it seems like they're trying to mitigate it.
I would use their interest to approach other investors and get better terms. Obviously you're doing something interesting if they're interested, just take that momentum and find someone else who's going to be a real partner.
I believe you must look closely into the sales pipeline to find an appropriate answer. A sales pipeline is an organized, visual way of tracking multiple potential buyers as they progress through different stages in the purchasing process. Often, pipelines are visualized as a horizontal bar, sometimes as a funnel, divided into the stages of a company’s sales process. It is a vital tool for salespeople, who are often juggling many sales prospects and deals, and cannot afford to have one slip through the cracks. “If you can look at your activities, how long they have been there and what are your conversion rates, it tells you where you are and what’s not working. Some organizations use a five-step pipeline, some use one with as many as eight stages, and some swear by seven stages. The number and type of stages in your pipeline has depends on a few factors, including how you contact leads and your product.
You can read more here: https://www.pipedrive.com/en/blog/sales-pipeline-fundamental-stages
Besides if you do have any questions give me a call: https://clarity.fm/joy-brotonath