Alector reprices roughly 4.05 million employee options to $1.87 a share

Alector, Inc.'s board of directors approved an option repricing that moves the exercise price on approximately 4.05 million employee stock options to $1.87 a share, the closing price of the company's common stock on October 13, 2026. The repriced options previously carried exercise prices ranging from $6.48 to $33.11, and the covered pool includes 2,421,197 options held by co-founder and chief executive officer Arnon Rosenthal and 87,385 held by chief accounting officer Grace Wong-Sarad.

Alector resets strikes as high as $33.11 to the October 13 close

The board acted on October 13, 2026, the effective date of the repricing. It covers stock options granted to current employees under Alector's 2019 Equity Incentive Plan, as amended, or its 2017 Stock Option and Grant Plan, that were held by continuing employees and carried an exercise price above $1.87 a share. The new exercise price is $1.87, which the filing identifies as the closing price of the company's common stock that day. The repriced options previously had exercise prices ranging from $6.48 to $33.11 per share, so the new price is 94.35% below the highest prior exercise price and 71.14% below the lowest.

Two named officers account for the largest blocks. Co-founder and chief executive officer Arnon Rosenthal holds 2,421,197 repriced options with original exercise prices from $6.48 to $23.70 a share, while chief accounting officer Grace Wong-Sarad holds 87,385 with original exercise prices from $9.46 to $23.70. Alector puts the total number of shares underlying all repriced options at approximately 4.05 million. The filing also states that, as of the approval date, a majority of employee options were underwater, with exercise prices above the current market price of the shares.

A retention premium keeps the reset conditional

A repriced option is not immediately a cheap option. The filing states that “if an employee exercises a repriced Eligible Option before the end of the Retention Period (as defined below), such employee will be required to pay a premium exercise price that is equal to the original exercise price per share”. The Retention Period runs from the effective date until the earliest of one year later, a change in control as defined in the applicable plan, or the holder's death or disability. Expiration dates, service-based vesting criteria and share counts are unchanged, so the repricing moves price alone.

A change in control is the hinge: once one occurs the premium window closes, and a holder can exercise at $1.87. The board approved the repricing “following careful consideration of various alternatives and a review of other applicable factors”, on the recommendation of its People, Culture, and Compensation Committee and with advice from its independent compensation consultant, after deliberations that ran through 2026. Alector frames the repricing as avoiding the dilution of new equity grants and the cash cost of higher cash compensation, the retention alternatives it weighed.

The filing stops short of measuring the repricing's cost

No participating-employee count, no aggregate spread between the old and new strikes, and no estimate of the incremental stock-based compensation expense appear in the report. Alector also gives no share count, so the 4.05 million repriced options cannot be sized against shares outstanding or the fully diluted base. The disclosure names only two holders, and does not say how many employees received the reset.

The modification lands in Alector's fourth quarter of 2026, the quarter ending December 31 on the company's fiscal calendar. The filing does not say how the repricing will be accounted for, where any incremental stock-based compensation expense would be recorded, or which later report would carry it. Absent a change in control, the retention premium lapses one year after the effective date, on October 13, 2027, when repriced options become exercisable at $1.87 without the original strike.