DEF 14A of Alector, Inc., Apr 25, 2024

DEF 14A of Alector, Inc.

Filed Apr 25, 2024 · FY20230000950170-24-048264

Open on EDGAR

  1. Nominees for Director

    Nominees for Director Louis J. Lavigne, Jr. Mr. Lavigne has served as a member of our Board of Directors since 2018, and as Chairperson of our Board of Directors since June 2023. Mr. Lavigne previously served as our Lead Independent Director from October 2018 to June 2023 and as chairperson of the Audit Committee from 2019 to May 2023. Mr. Lavigne is Managing Partner of Laman Partners, LLC, a consulting firm focusing on finance, strategy, and management, since 2019 and Managing Director of Lavrite, LLC since 2005. Mr. Lavigne served in various executive capacities with Genentech, Inc. for over 20 years, including Chief Financial Officer from 1988 to 2005, Executive Vice President from 1997 to 2005, Senior Vice President from 1994 to 1997, Vice President from 1986 to 1994, and Controller from 1983 to 1986. He served as a member of the board of directors of Zynga Inc., a social game company, from 2015 to May 2022, including as an audit committee member (and formerly audit committee chairperson) and as a member of the nominating and governance committee. Mr. Lavigne was a member of the board of directors of Accuray, Inc., a radiation oncology company, between 2009 and June 2021, where he served as chairman of the board and the compensation committee as well as a member of the nominating and governance committee. He also served as a member of the board of directors of Rodan + Fields, LLC, a private skincare company, from June 2015 to July 2021 where he was lead director between August 2020 and July 2021 and chaired the audit committee from December 2019 to July 2021. Within the last five years, Mr. Lavigne also served as a director and chair of the audit committee of NovoCure Limited, an oncology company, from 2013 until October 2018; as a director, chair of the compensation committee, and member of the audit committee of Assertio Therapeutics, Inc., a pharmaceutical company, from July 2013 until his resignation in May 2019; and as a director, chair of the audit committee, and member of the compensation committee of DocuSign Inc., an eSignature transaction management company, from July 2013 to May 2020. Mr. Lavigne is the former chairman and board member of the UCSF Benioff Children’s Hospitals and the UCSF Benioff Children’s Hospitals Foundation. Mr. Lavigne holds a B.S. in Business Administration from Babson College and an M.B.A. from Temple University. We believe Mr. Lavigne is qualified to serve on our Board of Directors because of his extensive experience in business operations and management, strategy, finance, accounting, and public company governance as a chief financial officer of a large, complex publicly-traded company and his extensive board leadership positions with a number of public company boards and board committees. Richard H. Scheller, Ph.D. Dr. Scheller has served as a member of our Board of Directors and our Scientific Advisory Board (“SAB”) since October 2018 and has served as co-chair of our Strategic Portfolio Advice and Review Committee (“SPARC”) since December 2019. Dr. Scheller has served as the Chairman of Research and Development at BridgeBio Pharma LLC, a publicly traded biotechnology company, since January 2019 and as a member of its board of directors from 2018 to 2023. In addition, Dr. Scheller serves on the board of directors at 23andMe Holding Co., Maze Therapeutics, and Aarvik Therapeutics, and on the board of trustees at Caltech and the board of the Corporation of the Fine Arts Museums of San Francisco. He previously served on the board of directors of Xenon Pharmaceuticals from 2015 to 2020, ORIC Pharmaceuticals from 2015 to 2021, and as chairman of the board of directors of DICE Therapeutics from 2015 to 2023. From 2015 to 2019, Dr. Scheller was Head of Therapeutics and Chief Scientific Officer at 23andMe. At Genentech from 2001 to 2014, he was Executive Vice President of Research and Early Development and served on the executive committees of Roche and Genentech focusing on research strategy, drug discovery, business development and early drug development activities. From 1982 to 2001, Dr. Scheller was a professor at Stanford in the Department of Biological Sciences and the Department of Molecular and Cellular Physiology and was an investigator at the Howard Hughes Medical Institute of Stanford University Medical Center. Since 2004, Dr. Scheller has served as an adjunct professor in the Department of Biochemistry and Biophysics at the University of California, San Francisco. Dr. Scheller’s research elucidating the molecular machinery and regulatory mechanism that underly neurotransmitter release earned him the 2013 Albert Lasker Basic Medical Research Award, the 2010 Kavli Prize in Neuroscience, and the 1997 U.S. National Academy of Sciences Award in Molecular Biology. He is a fellow of the American Academy of Arts and Sciences, a member of the National Academy of Sciences, and a member of the National Academy of Medicine. Dr. Scheller holds a Ph.D. in Chemistry from the California Institute of Technology and B.Sc. in Biochemistry from the University of Wisconsin-Madison. We believe Dr. Scheller is qualified to serve on our Board of Directors because of his scientific background and his senior management experience in the pharmaceutical industry. Mark Altmeyer. Mr. Altmeyer has served as a member of our Board of Directors since March 2024. Mr. Altmeyer currently serves on the boards of directors of Novaremed A.G. and Merz Holdings Therapeutics and as chairman of the board of directors of, AM-Pharma B.V. Mr. Altmeyer previously served on the boards of directors of Clarion Healthcare, Inc. from March 2021 to October 2022, Myovant Sciences, Inc. from September 2016 to December 2018, and Arvelle Therapeutics, B.V. from February 2019 to February 2021. He was also founder, President and Chief Executive Officer at Arvelle Therapeutics, where he led the organization through the approval of its lead product by EMA and the company’s efforts to prepare for launch in Europe until its acquisition by Angelini Pharma. Prior to that, Mr. Altmeyer served as President and Chief Commercial Officer at Axovant Sciences, where he led the establishment of global commercial capabilities and pre-launch preparations for various pipeline products, and as President and Chief Executive Officer at Otsuka America Pharmaceutical Inc., transforming the company into a successful commercial organization and doubling total revenues over five years. Earlier in his career, Mr. Altmeyer held senior commercial and general management positions at Bristol-Myers Squibb and Cetus Corporation. Mr. Altmeyer holds an MBA from Harvard Graduate School of Business and a BA in economics from Middlebury College. We believe Mr. Altmeyer is qualified to serve on our Board of Directors because of his extensive senior management and board experience in the pharmaceutical industry.

  2. Continuing Directors

    Continuing Directors Arnon Rosenthal, Ph.D. Dr. Rosenthal co-founded Alector in 2013 and has served as a member of our Board of Directors and as Chief Executive Officer since 2013. Dr. Rosenthal co-founded Annexon Biosciences, Inc. and served as its acting Chief Executive Officer from August 2011 to December 2014 and served as a member of the board of directors, including as Chairman from August 2011 to February 2017. Dr. Rosenthal co-founded Rinat Neuroscience Corporation, which discovered and developed the migraine drug, Ajovy (acquired by Pfizer Inc. in August 2006), and served as President, Chief Scientific Officer, and as a member of the board of directors from August 2001 to August 2006. From January 1985 to August 2001, Dr. Rosenthal served in various roles at Genentech, Inc., where he ultimately served as Staff Scientist and was appointed as a permanent member of Genentech’s Research Review Committee, where his team discovered the target for the cancer drug Erivedge. Dr. Rosenthal conducted his post-doctoral fellowship at Genentech, Inc. He holds a Ph.D. in biology from the Hebrew University of Jerusalem. We believe Dr. Rosenthal is qualified to serve on our Board of Directors because of the perspective and experience he provides as one of our founders and as our Chief Executive Officer, his experience as a founder and director of other life sciences companies, his educational background, as well as his broad experience within the pharmaceutical industry, particularly in the area of neuroscience and drug discovery and development. Paula Hammond, Ph.D. Dr. Hammond has served as a member of our Board of Directors since March 2020. Dr. Hammond is Institute Professor and the Vice Provost for Faculty at the Massachusetts Institute of Technology (“MIT”), where she has been a faculty member since 1995. She served as the Head of the Department of Chemical Engineering at MIT since from 2015 through 2023. She is a member of MIT’s David H. Koch Institute for Integrative Cancer Research and a founding member of the MIT Institute for Soldier Nanotechnology. She also served as the Associate Head of the Chemical Engineering Department at MIT from 2008 to 2011. Dr. Hammond was the recipient of the 2013 AIChE Charles M. A. Stine Award, which is bestowed annually to a leading researcher in recognition of outstanding contributions to the field of materials science and engineering, the 2014 Alpha Chi Sigma Award for Chemical Engineering Research, and the Margaret Rousseau Award for Lifetime Achievement by a Woman Chemical Engineer in 2019. She received the Department of Defense Ovarian Cancer Teal Innovator Award in 2013, which supports a single visionary individual from any field principally outside of ovarian cancer. She also received the 2024 Benjamin Franklin Medal of Chemistry. She was named a Fellow of the American Physical Society, the American Institute of Biological and Medical Engineering, and the American Chemical Society, Division of Polymer Chemistry. Dr. Hammond was elected into the National Academy of Sciences in 2019, the National Academy of Engineering in 2017, the National Academy of Medicine in 2016, and the 2013 Class of the American Academy of Arts and Sciences. Dr. Hammond holds an M.S. in Chemical Engineering from the Georgia Institute of Technology and a Ph.D. and S.B. in Chemical Engineering from MIT. Dr. Hammond has published over 330 papers and over 20 patent applications. She is the co-founder and member of the Scientific Advisory Board of LayerBio, Inc., a member of the board of directors of Sail Biomedicines, Inc. (formerly Senda Biosciences, Inc.), a member of the board of directors of the MIT Engine, a member of the Scientific Advisory Board of Moderna, Inc., and an advisor for Catalio Capital Management. We believe Dr. Hammond is qualified to serve on our Board of Directors based on her scientific background and experience as an internationally recognized expert in the field of chemical engineering and based on her work in the field of cancer research, including her research on polymeric drug delivery of biologic and RNA therapies and treatment of glioblastoma using nanotechnologies that address delivery across the blood-brain barrier. David Wehner. Mr. Wehner has served as a member of our Board of Directors since October 2018. He has served as Chief Strategy Officer of Meta Platforms, Inc. (formerly Facebook, Inc.), a publicly-traded company, since November 2022. Mr. Wehner joined Meta Platforms, Inc. in November 2012 as Vice President, Corporate Finance and Business Planning and served as Chief Financial Officer from June 2014 to November 2022. From August 2010 until November 2012, Mr. Wehner served as Chief Financial Officer at Zynga Inc., a provider of social game services. From February 2001 to July 2010, Mr. Wehner served in various positions at Allen & Company, an investment bank, including as a Managing Director from November 2006 to July 2010 and as a director from December 2005 to November 2006. Mr. Wehner holds an M.S. in applied physics from Stanford University and a B.S. in chemistry from Georgetown University. We believe Mr. Wehner is qualified to serve on our Board of Directors based on his substantial executive, strategy, finance, and operational experience. Elizabeth Garofalo, M.D. Dr. Garofalo has served as a member of our Board of Directors since September 2021. Since 2016, Dr. Garofalo has served as the Principal for EAG Pharma Consulting LLC. Prior to that, Dr. Garofalo served in numerous leadership roles including as Senior Vice President and Global Head of Clinical Development and member of the Novartis Global Development Leadership Team, Chair of the Novartis Portfolio Stewardship Board, and Co-Head of the Novartis Neuroscience Franchise. Prior to that, she was Vice President and Head of the Neuroscience Therapy Area at Astellas. She started her career at Parke-Davis/Pfizer where she had jobs of increasing responsibility, including Ann Arbor Site Head of Neuroscience and Ann Arbor Site Head of Worldwide Regulatory Affairs. Since September 2020, Dr. Garofalo has served as a member of the board of Acadia Pharmaceuticals Inc. From March 2021 to February 2023, she served as a member of the board and member of the audit committee of Exicure, Inc. and from March 2022 to February 2023, as chair of the board of Exicure, Inc. She has served since June 2021 as a member of the board of Xenon Pharmaceuticals. She also serves as the chair of the board of the non-profit Institute for Advanced Clinical Trials in Children. Dr. Garofalo earned an M.D. from the Indiana University School of Medicine where she completed her pediatric residency. She completed fellowships in pediatric neurology and epilepsy at the University of Michigan Medical School. We believe Dr. Garofalo is qualified to serve on our Board of Directors because of her scientific background, including her clinical development experience, and her executive experience in the pharmaceutical industry.

  3. Continuing Directors

    Kristine Yaffe, M.D. Dr. Yaffe has served as a member of our Board of Directors since August 2019. Dr. Yaffe is the Scola Endowed Chair and the Leon Epstein Chair and Vice Chair, Professor of Psychiatry, Neurology, and Epidemiology, and Director of the Center for Population Brain Health at the University of California, San Francisco (“UCSF”). Dr. Yaffe is an internationally recognized expert in the epidemiology of dementia and is a foremost leader in identifying modifiable risk factors for dementia that serve as a foundation for prevention. She also currently serves on the Beeson Scientific Advisory Board and the Global Council on Brain Health. She previously was the Co-Chair of the United States’ Institute of Medicine’s Committee on Cognitive Aging. Dr. Yaffe has received numerous awards for her groundbreaking contributions to the field including the American Academy of Neurology’s Potamkin Prize for Alzheimer’s Research in 2017, the NIH Robert S. Gordon, Jr. Award in Epidemiology in 2021, and the Department of Veterans Affairs John B. Barnwell Award for Achievement in Clinical Research in 2022. Dr. Yaffe holds a B.S. in biology-psychology from Yale University and an M.D. from the University of Pennsylvania School of Medicine and has completed residencies in neurology and psychiatry at UCSF. Dr. Yaffe was elected to the National Academy of Medicine in 2019. We believe Dr. Yaffe is qualified to serve on our Board of Directors based on her experience as an internationally recognized expert in the fields of cognitive aging, neurodegeneration, and dementia. Errol De Souza, Ph.D. Dr. De Souza has served as a member of our Board of Directors since March 2024. Dr. De Souza also serves as a member and chair of the board of directors of Cyclerion Therapeutics, Inc. Dr. De Souza was the executive chairman of Bionomics Limited from November 2018 to December 2022, the non-executive chairman from January 2023 to June 2023 and non-executive director until November 2023. Previously, Dr. De Souza served as President, Chief Executive Officer, and director of several companies, including Neuropore Therapies, Inc. from January 2017 to December 2019, Biodel, Inc. from March 2010 to January 2016, Archemix Corp from April 2003 to March 2009 and Synaptic Pharmaceutical Corporation from September 2002 to March 2003. From September 1998 to September 2002, Dr. De Souza held senior vice president roles at Hoechst Marion Roussel Pharmaceuticals, Inc. and Aventis Pharmaceuticals, Inc. (now Sanofi). He was also founder, Executive Vice President of R&D and director at Neurocrine Biosciences, Inc. from October 1992 to August 1998, and Head of CNS Diseases Research at DuPont Merck from May 1990 to October 1992. Dr. De Souza is currently a member of the board of directors of Bionaut Labs. Inc. and Royalty Pharma. He has previously served on the boards of directors of Catalyst Biosciences, Inc., Targacept, Inc., IDEXX Laboratories, Palatin Technologies, Inc., and a number of private company boards. Dr. De Souza received a B.A. in physiology and a Ph.D. in endocrinology from the University of Toronto and completed his post-doctoral fellowship in neuroscience from The Johns Hopkins University School of Medicine. We believe Dr. De Souza is qualified to serve on our Board of Directors because of his scientific background and extensive senior management and board experience in the pharmaceutical industry.

  4. Considerations in Evaluating Director Nominees

    Considerations in Evaluating Director Nominees Our Corporate Governance and Nominating Committee uses a variety of methods for identifying and evaluating director nominees. In its evaluation of director candidates, our Corporate Governance and Nominating Committee will consider the current size and composition of our Board of Directors and the needs of our Board of Directors and the respective committees of our Board of Directors. Some of the qualifications that our Corporate Governance and Nominating Committee considers include, without limitation, issues of character, integrity, judgment, diversity of experience, independence, areas of expertise, corporate experience, length of service, potential conflicts of interest, and other commitments. Nominees must also have the ability to offer advice and guidance to management and be leaders in the companies or institutions with which they are affiliated. Director candidates must have sufficient time available in the judgment of our Corporate Governance and Nominating Committee to perform all Board of Directors and committee responsibilities. Members of our Board of Directors are expected to prepare for, attend, and participate in all Board of Directors and applicable committee meetings. Other than the foregoing, there are no stated minimum criteria for director nominees, although our Corporate Governance and Nominating Committee may also consider such other factors as it may deem, from time to time, are in our and our stockholders’ best interests. Although our Board of Directors does not maintain a specific policy with respect to board diversity, our Board of Directors believes that our Board of Directors should be a diverse body, and our Corporate Governance and Nominating Committee may consider such factors as differences in professional background, education, skill, and other individual qualities and attributes that contribute to the total mix of viewpoints and experience represented on our Board of Directors. In making determinations regarding nominations of directors, our Corporate Governance and Nominating Committee may take into account the benefits of diverse viewpoints. Our Corporate Governance and Nominating Committee also considers these and other factors as it oversees the annual Board of Directors and committee evaluations. After completing its review and evaluation of director candidates, our Corporate Governance and Nominating Committee recommends to our full Board of Directors the director nominees for selection.

  5. Director Compensation

    Director Compensation Directors who are also our employees receive no additional compensation for their service as directors. Dr. Rosenthal was our only employee director during the fiscal year ended December 31, 2023. See the section titled “Executive Compensation” for additional information about Dr. Rosenthal’s compensation. The following table presents the total compensation that each of our non-employee directors received during the fiscal year ended December 31, 2023. Other than as set forth in the table, we did not pay any compensation, make any equity awards or non-equity awards to, or pay any other compensation to any of our non-employee directors in the fiscal year ended December 31, 2023.

  6. Director Compensation

    | Name | Fees Earned or Paid in Cash ($) | Stock Awards ($)(1) | Option Awards ($)(1) | All Other Compensation ($) | Total ($) | | Louis J. Lavigne, Jr. | 88,653 | 202,388 | 64,027 | — | 355,068 | | Elizabeth Garofalo, M.D. | 55,854 | 202,388 | 64,027 | — | 322,269 | | Paula Hammond, Ph.D. | 52,500 | 202,388 | 64,027 | — | 318,915 | | Terry McGuire | 56,708 | 202,388 | 64,027 | — | 323,123 | | Richard H. Scheller, Ph.D. | 40,000 | 257,733(2) | 64,027 | 147,366(3) | 509,126 | | David Wehner | 58,292 | 202,388 | 64,027 | — | 324,706 | | Kristine Yaffe, M.D. | 51,708 | 202,388 | 64,027 | — | 318,123 | | Tillman Gerngross, Ph.D. | 27,667 | —(4) | —(4) | — | 27,667 |

  7. Director Compensation

    (1) Except as otherwise indicated in footnote 2 below, the amount disclosed in this column for each non-employee director represents the grant date fair value of the Annual Option Award or Annual RSU Award (as those terms are defined below) granted to the non-employee director under our Outside Director Compensation Policy in 2023, as calculated in accordance with FASB ASC Topic 718 (as defined below). The assumptions used in calculating the grant date fair values of the awards disclosed in this column are set forth in Notes 2 and 8 to our audited financial statements included in our Annual Report on Form 10-K filed with the SEC on February 27, 2024. These amounts do not correspond to the actual value that may be recognized by the directors upon vesting or exercise of the applicable awards. (2) The amount reported includes (i) Dr. Scheller’s Annual RSU Award (which has a grant date fair value of $202,388), and (ii) an award of 8,541 RSUs granted to Dr. Scheller under agreements between him and the Company (which has a grant date fair value of $55,345), as more fully described in the section titled “Related Party Transactions – Consulting Agreement with Dr. Richard Scheller.” (3) The amount reported constitutes payment under agreements between Dr. Scheller and the Company as more fully described in the section titled “Related Party Transactions – Consulting Agreement with Dr. Richard Scheller.” Dr. Gerngross resigned from the Board effective June 15, 2023 and did not earn or receive any equity awards during the fiscal year ended December 31, 2023.

  8. Outstanding Equity Awards at Fiscal Year End

    Outstanding Equity Awards at Fiscal Year End The following table lists all outstanding equity awards held by non-employee directors as of December 31, 2023:

  9. Outstanding Equity Awards at Fiscal Year End

    | Name | Date of Grant | Number of Shares Underlying Unexercised Option Awards (#) | Option Exercise Price ($) | Option Expiration Date | Number of Shares Underlying Unvested Stock Awards (#) | | Elizabeth Garofalo, M.D. | 9/23/2021 | 33,235(3) | 24.26 | 9/22/2031 | | | | 6/16/2022 | 18,918(1) | 8.07 | 6/15/2032 | | | | 6/14/2023 | 12,360(1) | 7.71 | 6/13/2033 | | | | 6/14/2023 | | | | 26,250(2) | | Paula Hammond, Ph.D. | 3/20/2020 | 29,443(3) | 29.31 | 3/19/2030 | | | | 6/17/2021 | 25,709(1) | 21.37 | 6/16/2031 | | | | 6/16/2022 | 18,918(1) | 8.07 | 6/15/2032 | | | | 6/14/2023 | 12,360(1) | 7.71 | 6/13/2033 | | | | 6/14/2023 | | | | 26,250(2) | | Louis J. Lavigne, Jr. | 11/6/2018 | 70,000(4) | 10.14 | 11/5/2028 | | | | 5/10/2019 | 20,000(1) | 20.05 | 5/9/2029 | | | | 5/11/2020 | 19,274(1) | 29.09 | 5/10/2030 | | | | 6/17/2021 | 25,709(1) | 21.37 | 6/16/2031 | | | | 6/16/2022 | 18,918(1) | 8.07 | 6/15/2032 | | | | 6/14/2023 | 12,360(1) | 7.71 | 6/13/2033 | | | | 6/14/2023 | | | | 26,250(2) | | Terry McGuire | 5/10/2019 | 20,000(1) | 20.05 | 5/9/2029 | | | | 5/11/2020 | 19,274(1) | 29.09 | 5/10/2030 | | | | 6/17/2021 | 25,709(1) | 21.37 | 6/16/2031 | | | | 6/16/2022 | 18,918(1) | 8.07 | 6/15/2032 | | | | 6/14/2023 | 12,360(1) | 7.71 | 6/13/2033 | | | | 6/14/2023 | | | | 26,250(2) | | Richard Scheller, Ph.D. | 11/6/2018 | 25,574(5) | 10.14 | 11/5/2028 | | | | 5/10/2019 | 20,000(1) | 20.05 | 5/9/2029 | | | | 1/1/2020 | 100,000(6) | 17.23 | 12/31/2029 | | | | 5/11/2020 | 19,274(1) | 29.09 | 5/10/2030 | | | | 6/17/2021 | 25,709(1) | 21.37 | 6/16/2031 | | | | 6/16/2022 | 18,918(1) | 8.07 | 6/15/2032 | | | | 6/14/2023 | 12,360(1) | 7.71 | 6/13/2033 | | | | 6/14/2023 | | | | 26,250(2) | | | 7/15/2023 | | | | 2,136(7) | | David Wehner | 11/6/2018 | 70,000(5) | 10.14 | 11/5/2028 | | | | 5/10/2019 | 20,000(1) | 20.05 | 5/9/2029 | | | | 5/11/2020 | 19,274(1) | 29.09 | 5/10/2030 | | | | 6/17/2021 | 25,709(1) | 21.37 | 6/16/2031 | | | | 6/16/2022 | 18,918(1) | 8.07 | 6/15/2032 | | | | 6/14/2023 | 12,360(1) | 7.71 | 6/13/2033 | | | | 6/14/2023 | | | | 26,250(2) | | Kristine Yaffe, M.D. | 8/9/2019 | 38,000(3) | 18.10 | 8/8/2029 | | | | 5/11/2020 | 19,274(1) | 29.09 | 5/10/2030 | | | | 6/17/2021 | 25,709(1) | 21.37 | 6/16/2031 | | | | 6/16/2022 | 18,918(1) | 8.07 | 6/15/2032 | | | | 6/14/2023 | 12,360(1) | 7.71 | 6/13/2033 | | | | 6/14/2023 | | | | 26,250(2) | | Tillman Gerngross, Ph.D.(8) | — | — | — | — | |

  10. Outstanding Equity Awards at Fiscal Year End

    (1) One twelfth of the total number of shares subject to the option vested each month after the date of grant, provided that the option vests in full on the earlier of (i) the one-year anniversary of the date of grant, or (ii) the date of the next regularly scheduled annual meeting of the Company’s stockholders, subject to the director’s continued status as a service provider on each such vesting date. The shares subject to the restricted stock unit award will vest on the earlier of (i) the one-year anniversary of the date of grant, or (ii) the date of the next regularly scheduled annual meeting of the Company’s stockholders, subject to the director’s continued status as a service provider through each such vesting date. One fourth of the total number of shares subject to the option vested on the one-year anniversary of the date of grant, and an additional 1/48th of the total number of shares subject to the option vested and continues to vest each month thereafter, subject to the director’s continued status as a service provider through each such vesting date. (4) One fourth of the total number of shares subject to the option vested on October 25, 2019, and an additional 1/48th of the total number of shares subject to the option vested each month thereafter, subject to the director’s continued status as a service provider through each such vesting date. (5) One fourth of the total number of shares subject to the option vested on October 9, 2019, and an additional 1/48th of the total number of shares subject to the option vested each month thereafter, subject to the director’s continued status as a service provider through each such vesting date. (6) One forty-eighth of the total number of shares subject to the option vested on January 6, 2020, and an additional 1/48th of the total number of shares subject to the option vested and continues to vest each month thereafter, subject to the director’s continued status as a service provider through each such vesting date. (7) The award shall vest as to 50% of the shares on September 1, 2023, as to 25% of the shares on December 1, 2023, and as to the remaining shares on March 1, 2024. All such vesting shall be subject to Dr. Scheller’s continued status as a service provider through each such vesting date. (8) Dr. Gerngross resigned from the Board effective June 15, 2023 and did not have any equity awards outstanding as of December 31, 2023.

  11. Outside Director Compensation Policy

    Outside Director Compensation Policy Our Board of Directors adopted an Outside Director Compensation Policy that provides for certain compensation to our non-employee directors. Under our Outside Director Compensation Policy, each non-employee director received the following cash and equity compensation for their service as a member of our Board of Directors in 2023.

  12. PROPOSAL NO. 1 ELECTION OF DIRECTORS

    PROPOSAL NO. 1 ELECTION OF DIRECTORS Our Board of Directors is currently comprised of nine members. In accordance with our amended and restated certificate of incorporation, our Board of Directors is divided into three staggered classes of directors. At the Annual Meeting, three Class III 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 the election and qualification of his or her successor, or such director’s 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 our directors. This classification of our Board of Directors may have the effect of delaying or preventing a change-in-control of Alector.

  13. Overview of Executive Compensation Program

    Overview of Executive Compensation Program Our executive compensation program is designed to be competitive and to appropriately balance our goals of attracting, engaging, and retaining our executive officers and driving company performance. To align our executive officers’ interests with those of our stockholders and to motivate and reward individual initiative and effort, a substantial portion of each executive officer’s total target annual direct compensation opportunity is “at-risk,” meaning the amounts paid to each executive officer will vary based on our Company performance and such executive officer’s contributions to that performance. Consistent with our philosophy of aligning executive pay with the short- and long-term performance of the Company, and to align the interests of management and stockholders, the Company’s compensation programs are designed to provide the majority of executive compensation in the form of variable, at-risk pay. Our Compensation Committee thoughtfully employs the primary compensation elements of base salary, short-term annual cash incentives, and long-term equity awards, to achieve these objectives. In 2023, target pay packages were as follows: The percentages above were calculated using base salary, target annual cash incentive compensation, and the grant date fair value of our long-term incentive vehicles. Similar to our industry-based peers, we have gradually shifted the equity mix for our executives and employees towards the use of RSUs, which incentivizes executives to create value for the Company and shareholders, while also managing the equity pool with discipline, due to the fact that RSUs are linked to stock price performance but expend less shares than stock options to deliver the same value. As in past years, the Compensation Committee continued to consider the appropriate timing for the adoption of performance-vested equity. It is our view that performance-vested equity should only be used when there is an ability to establish meaningful long term (i.e., three-year goals) financial goals.

  14. Executive Compensation Governance

    | What We Do | | | ✓ | Pay-for-performance philosophy and culture | | ✓ | Responsible use of shares under our long-term equity incentive program | | ✓ | Align pay outcomes with objective performance outcomes | | ✓ | Use relevant peer group pay quantum and design data as a reference point | | ✓ | Balanced mix of fixed and at-risk pay | | ✓ | Robust anti-hedging and anti-pledging policies | | ✓ | Retain an independent compensation consultant |

  15. Executive Compensation Governance

    | What We Don’t Do | | Provide excessive severance paymentsx | | Allow single-trigger change in control cash severance agreementsx |

  16. Role of Independent Compensation Consultant

    Role of Independent Compensation Consultant Our Compensation Committee is authorized to retain the services of one or more executive compensation advisors, as it sees fit, in connection with the establishment of our compensation programs and related policies. For 2023, the Compensation Committee engaged Pearl Meyer & Partners, LLC (“Pearl Meyer”) as its independent compensation consultant, to provide it with information, recommendations, and other advice relating to executive compensation on an ongoing basis. Pearl Meyer reports directly to, and serves at the sole discretion of, our Compensation Committee. In 2023, Pearl Meyer advised the Compensation Committee on a variety of compensation-related issues, such as identifying an updated peer group of companies for market comparison purposes, gathering market compensation data and making recommendations, assessing peer trends and best practices in executive compensation, and supporting other ad hoc matters throughout the year. Pearl Meyer also helped determine the appropriate level of overall compensation for our executive officers, and assess each separate element of compensation, with a goal of ensuring that the compensation offered to our executive officers is competitive and fair.

  17. Use of Peer Group

    Use of Peer Group The Compensation Committee approves a peer group of companies as a reference group to provide a broad perspective on competitive pay levels and practices. The peers are reviewed on an annual basis in light of the fast-moving changes at the Company and in our industry. In 2023, we undertook this review with the assistance and recommendations of Pearl Meyer, who provided competitive market analysis of the base salary, annual cash incentive awards, and long-term incentive compensation of our executive officers compared against our compensation peer group and reviewed other market practices and trends.

  18. 2022 Peer Group

    2022 Peer Group In August 2022, the Compensation Committee approved a peer group for use in making third quarter 2022 equity award decisions and first quarter 2023 base salary and annual target bonus decisions, and for use in assessing compensation data for senior executive new hire packages. The Compensation Committee considered the following criteria in determining the appropriate peers: • Industry Sector and Product Focus—Broad focus on biotechnology and pharmaceutical industry with an emphasis on companies with neurology, oncology, CNS, and rare disease indications. • Stage—Continue to target Phase 2 and Phase 3 companies, aligned with the progress of our lead candidates through our pipeline. • Market Capitalization—Companies with a median market value of $1.2 billion at the time of the analysis; range between $200 million to $4.3 billion (approximately 0.2x to 4.7x of Alector’s then-current market capitalization). • Employee Headcount—Companies with a median of 205 full-time employees. • Location—Biotechnology hub markets (San Francisco Bay Area, San Diego, New York, Boston, etc.). Based on these criteria and considerations, eight companies were added to form the 2022 peer group, and eight were removed. Our peer group for 2022, as approved by our Compensation Committee, consisted of the following 21 companies:

  19. 2022 Peer Group

    | Allakos | Gossamer Bio | REGENXBIO | | Amylyx Pharmaceuticals | IDEAYA Biosciences | Revolution Medicines | | Arcus Biosciences | Karuna Therapeutics | Sangamo Therapeutics | | Arvinas | Kezar Life Sciences | Stoke Therapeutics | | Axsome Therapeutics | NGM Biopharmaceuticals | TG Therapeutics | | Deciphera Pharmaceuticals | Nurix Therapeutics | Turning Point Therapeutics | | Denali Therapeutics | Prothena | Xenon Pharmaceuticals |

  20. 2023 Peer Group

    2023 Peer Group In June 2023, the Compensation Committee approved a peer group for use in making third quarter 2023 equity award decisions and first quarter 2024 base salary and annual target bonus decisions, and for use in assessing compensation data for senior executive new hire packages. The Compensation Committee considered the following criteria in determining the appropriate peers: • Industry Sector and Product Focus—Broad focus on biotechnology and pharmaceutical industry with an emphasis on companies with neurology and oncology indications. • Stage—Companies with Phase 2 and Phase 3 assets prioritized. • Market Capitalization—Companies with a market capitalization range between $200 million and $2.0 billion at the time of the analysis (approximately 0.35x to 3.5x of Alector’s then-current market capitalization). • Employee Headcount—Companies with a headcount range of 20 to 500 full-time employees as of the end of the last fiscal year. Location—Companies in the biotechnology hub markets (San Francisco Bay Area, San Diego, New York, Boston, etc.). Based on these criteria and considerations, six companies were added to form the 2023 peer group, and seven were removed. Our peer group for 2023, as approved by our Compensation Committee, consisted of the following 20 companies:

  21. 2023 Peer Group

    | Allakos | Denali Therapeutics | RAPT Therapeutics* | | Amylyx Pharmaceuticals | IDEAYA Biosciences | Sangamo Therapeutics | | Arcus Biosciences | iTeos Therapeutics* | Seres Therapeutics* | | Arvinas | Kezar Life Sciences | Stoke Therapeutics | | bluebird bio* | NGM Biopharmaceuticals | Vigil Neuroscience* | | Day One Pharmaceuticals* | Nurix Therapeutics | Xenon Pharmaceuticals | | Deciphera Pharmaceuticals | Prothena | |

  22. 2023 Peer Group

    * New for 2023 In setting compensation for our executive officers, including our named executive officers, the Compensation Committee uses competitive compensation data from an annual total compensation study of selected peer companies and relevant survey sources to inform its decisions about overall compensation opportunities and specific compensation elements. However, the Compensation Committee uses our compensation peer group as one data point when setting executive pay packages. The overall compensation philosophy focuses at or near a target percentile, particularly in respect to target cash compensation and equity grants. In addition, our compensation decisions are based on the consideration of many factors, including, but not limited to, individual and company performance, market data, internal equity, value of unvested equity, experience, and strategic needs. As a result of evaluating compensation based on the criteria described above, total target compensation for our named executive officers may in certain circumstances be above or below the target levels of the peer group.

  23. Pay Components

    | Compensation Element | Purpose | Key Features | | Base Salary | • To attract and retain highly skilled executives. | • Fixed component of pay to provide financial stability, based on responsibilities, experience, individual contributions, and peer company data. | | Annual Cash Incentive Program | • To promote and reward the achievement of key short-term strategic and business goals of the Company as well as individual performance; to motivate and attract executives. | • Variable component of pay based on pre-set annual quantitative and qualitative performance assessment against role and responsibilities, and objectives related to corporate, program-specific, and functional goals. | | Equity Incentive Compensation | • To encourage executives and other employees to focus on long-term company performance; to promote retention; to reward outstanding company and individual performance. | • Delivered in a blend of stock options and restricted stock units, subject to multi-year vesting based on continued service. • The value of these awards depends on the performance of our common stock price, in order to align employee and executive interests with those of our stockholders over the longer term. |

  24. Executive Incentive Compensation Plan

    Executive Incentive Compensation Plan The Executive Incentive Compensation Plan (the “Bonus Plan”) is designed to provide a financial incentive to reward executives for the achievement of a series of program-specific, pipeline, and functional corporate goals. Payments under the plan are ultimately based on achievement of these pre-established corporate goals. Actual performance against targets, as measured by these pre-established corporate goals, funds the incentive payouts. The corporate bonus pool can be funded between 0% to a maximum of 150% of target funding levels. The total bonus payout cannot exceed the total amount of funding in the pool. Annual target bonuses are set based on factors such as the executive’s past contributions, tenure, experience, and role and the annual target bonuses provided by companies in our compensation peer group to their similarly situated executives. Our Chief Executive Officer receives a bonus based on corporate performance since he has ultimate operational responsibility for corporate performance. Our other named executive officers’ target bonus weighting is primarily linked to corporate performance (80%), with a smaller weight applied to the individual performance component (20%), given the Company’s focus on delivering on corporate performance while driving individual accountability. The individual performance component of the bonus for these executive officers can be modified up to 150% or down to 0% dependent on performance in the prior year. In addition, the Compensation Committee retains flexibility to increase or decrease any and all compensation components to reflect performance. Bonuses are typically paid in the quarter following the end of the performance period. The annual bonus target percentages for all named executive officers remained flat in 2023, which was deemed appropriate after considering peer and market data. The bonuses paid to each of our named executive officers in 2023 under our Bonus Plan are also set forth in the “Non-Equity Incentive Plan Compensation” column of the Summary Compensation Table below. Bonuses for all employees, including our participating named executive officers, for the fiscal year ended December 31, 2023 were allocated from a bonus pool funded based on performance against a number of high-impact project goals and cross-functional goals. The project goals related to specific programs, trials, and corporate progress. The cross-functional goals included goals related to research and development, positioning for future growth and development, and other functional goals. The combination of the project and cross-functional goals was intended to drive both specific technical achievement and continue to build the foundation for future company growth and advancements. In December 2022, the Compensation Committee reviewed and the Board of Directors approved the corporate goals and objectives for 2023, as summarized in the table below. At the time the 2023 corporate goals were set, the Board of Directors and management believed that such goals were challenging, and that achieving them would require not only continued strong progress on research and clinical development, manufacturing and operational capabilities, and prudent fiscal and legal management, but also a high level of effort and execution on the part of our executive officers. These goals were viewed as critical drivers of our long-term success and ability to generate sustained growth in shareholder value. Our corporate goals were intended to drive these key objectives by establishing specific, measurable criteria that could be used to evaluate the performance of our executive team and the Company in general. We believed that achievement of these goals would have a direct impact on creating value for our stockholders. The Compensation Committee also applied a performance weighting to each goal relative to our overall performance to reflect the prioritization of key business objectives, as summarized below. Each goal was measured individually and then such individual amounts were aggregated to determine the 2023 corporate bonus payout, subject to the Compensation Committee’s discretion to alter bonus funding and payouts. The 2023 corporate performance bonuses were earned based upon achievement of such performance and stretch goals, as follows:

  25. Executive Incentive Compensation Plan

    (1) The “% Achieved (Weighted)” is the achievement percentage of the objective multiplied by the weighting of that objective. Based on the Company’s achievement of these goals, the Compensation Committee funded the Company’s corporate bonus pool at 111% of target levels. Our Chief Executive Officer receives a bonus based on corporate performance since he has ultimate operational responsibility for corporate performance. For the fiscal year ended December 31, 2023, the Committee exercised its ability to apply downward discretion on the calculated payout and determined that the CEO’s bonus payout would be 101% of target bonus due to a combination of corporate and stock price performance. The resulting bonuses to our named executive officers were as follows:

  26. Executive Incentive Compensation Plan

    | Name | 2023 Base Salary($) | 2023 Annual Target Bonus (% of base) | 2023 Actual Bonus Payout as a % of Salary(1) | 2023 Earned Award($) | | Arnon Rosenthal, Ph.D. | 658,350 | 60 | 61 | 400,000 | | Marc Grasso, M.D. | 500,000 | 40 | 45 | 225,672 | | Sara Kenkare-Mitra, Ph.D. | 604,200 | 100 | 114 | 687,580 | | Gary Romano, M.D., Ph.D. | 508,000 | 40 | 47 | 241,295 |

  27. Executive Incentive Compensation Plan

    (1) Except for our Chief Executive Officer, our executive officers’ target bonus weighting is primarily linked to corporate performance (80%), with a smaller weight applied to the individual performance component (20%). The 2024 annual bonus targets for our current executive officers are as follows:

  28. Executive Incentive Compensation Plan

    | Name | 2024 Annual Target Bonus (% of base) | | Arnon Rosenthal, Ph.D. | 60 | | Marc Grasso, M.D. | 40 | | Sara Kenkare-Mitra, Ph.D. | 100 | | Gary Romano, M.D., Ph.D. | 40 |

  29. Long-Term Equity Incentive Compensation

    Long-Term Equity Incentive Compensation We believe long-term equity incentive compensation is an effective means for focusing our executive officers, including the named executive officers, on driving strong performance and increased stockholder value over a multi-year period, provides a meaningful reward for long-term value creation, and motivates them to remain employed with us. This approach aligns the contributions of our executive officers with the long-term interests of our stockholders and allows them to participate in any future appreciation in our common stock. We determine long-term equity incentive compensation for our executive officers as part of our biannual compensation review (with cash compensation reviewed in the first quarter and equity compensation reviewed in the third quarter) taking into account competitive market analysis, the recommendations of our Chief Executive Officer with respect to such equity compensation (except regarding his own equity incentive compensation), the outstanding equity holdings of each executive officer, the projected impact of the proposed awards on our earnings, and our Company performance in 2023.

  30. Annual Equity Grants

    Annual Equity Grants In 2023, the long-term equity incentive compensation awarded to our executive officers based on our annual equity compensation review was granted in the form of stock options vesting over a four-year time-based schedule and restricted stock units vesting over a three-year time-based schedule. The equity mix comprised 75% restricted stock units and 25% stock options. This approach to long-term equity incentive compensation is consistent with market practice among our peer group and reinforces a strong pay-for-performance culture as the value of each award increases only if the value of our common stock appreciates from the grant date. Each award was granted on the following material terms:

  31. Annual Equity Grants

    | Name | Stock Options Number of Shares(#)(1) | Restricted Stock Units Number of Shares(#)(2) | | Arnon Rosenthal, Ph.D. | 132,500 | 397,600 | | Marc Grasso, M.D. | 41,000 | 123,000 | | Sara Kenkare-Mitra, Ph.D. | 54,500 | 163,600 | | Gary Romano, M.D., Ph.D. | 36,000 | 108,000 |

  32. Annual Equity Grants

    (1) Each option award has an exercise price equal to $6.48 per share, which was the closing price of our common stock on the immediately preceding trading day of the date of grant, October 1, 2023. The shares vest monthly over 48 months in equal amounts starting on November 1, 2023, subject to the applicable named executive officer’s continued service. Each restricted stock unit award vested and continues to vest in 12 equal quarterly installments beginning on December 1, 2023, subject to the applicable named executive officer’s continued service.

  33. Severance and Change in Control Protections

    Severance and Change in Control Protections In November 2018, we adopted a Change in Control and Severance Agreement (the “Severance Agreement”) in which our named executive officers participate. The Severance Agreement provides participants with severance in the event of certain qualifying terminations, including following a change in control of our Company, and certain change in control benefits. We believe that these protections are necessary to provide our valuable executives with incentives to forego other employment opportunities and remain employed with us and to maintain continued focus and dedication to their responsibilities to maximize stockholder value, including if there is a potential transaction that could involve a change in control. In addition, these protections are available only if a named executive officer executes and does not revoke a general release of claims in favor of us. The terms and levels of benefits provided to our named executive officers under the Severance Agreement were determined by our Compensation Committee, with input from our management team, and approved by our Board of Directors following a review of analysis prepared by our compensation consultant of relevant market data for other companies with whom we compete for executive talent. For a summary of the material terms of the benefits provided to our named executive officers under the Severance Agreement and an estimate of the payments and benefits that may be received by our named executive officers under the Severance Agreements, see the section titled “Potential Payments on Termination or Change in Control” below.

  34. Taxation of Parachute Payments and Deferred Compensation

    Taxation of Parachute Payments and Deferred Compensation We do not provide, and have no obligation to provide, any of our named executive officers with a “gross-up” or other reimbursement payment for any tax liability he or she might owe because of the application of Sections 280G, 4999, or 409A of the Code. If any of the payments or benefits provided for under the Severance Agreement or otherwise payable to a named executive officer would constitute “parachute payments” within the meaning of Section 280G of the Code and could be subject to the related excise tax, he or she would receive either full payment of such payments and benefits or such lesser amount that would cause no portion of the payments and benefits being subject to the excise tax, whichever results in the greater after-tax benefits to our named executive officer.

  35. Summary Compensation Table for Fiscal Years 2023, 2022, and 2021

    Summary Compensation Table for Fiscal Years 2023, 2022, and 2021 The following table provides information regarding the compensation awarded to, or earned by, our named executive officers during 2023, 2022, and 2021.

  36. Summary Compensation Table for Fiscal Years 2023, 2022, and 2021

    | Name and Principal Position | Year | Salary ($)(1) | Bonus ($)(1) | Stock Awards ($)(2) | Option Awards ($)(2) | Non-Equity Incentive Plan Compensation ($)(1) | All Other Compensation ($) | Total ($) | | Arnon Rosenthal, Ph.D. | 2023 | 653,625 | — | 2,576,448 | 614,323 | 400,000(13) | 10,611(4) | 4,255,007 | | Co-founder, | 2022 | 621,413 | — | 1,694,939 | 800,515 | 389,340(3) | 9,191 | 3,515,398 | | Chief Executive Officer | 2021 | 575,400 | — | 1,801,875 | 6,837,954 | 388,160 | 9,191 | 9,612,580 | | Marc Grasso, M.D.(5) | 2023 | 496,800 | — | 797,040 | 190,092 | 225,672(13) | 6,242(8) | 1,715,846 | | Chief Financial Officer | 2022 | 432,923 | 103,000(6) | 337,741 | 4,935,992 | 200,448(7) | 1,676 | 6,011,780 | | Sara Kenkare-Mitra, Ph.D. | 2023 | 598,500 | — | 1,060,128 | 252,684 | 687,580(13) | 7,322(9) | 2,606,214 | | President and | 2022 | 570,000 | — | 3,018,736 | 4,662,171 | 612,180(7) | 7,322 | 8,870,409 | | Head of Research and Development | 2021 | 25,942 | 500,000(10) | — | — | 26,813 | 28 | 526,841 | | Gary Romano, M.D., Ph.D. (11) | 2023 | 502,312 | — | 699,840 | 166,910 | 241,295(13) | 8,564(12) | 1,618,921 | | Chief Medical Officer | 2022 | 289,872 | — | 1,038,345 | 2,451,835 | 118,682(7) | 7,165 | 3,905,899 |

  37. Summary Compensation Table for Fiscal Years 2023, 2022, and 2021

    (1) Salary, bonus, and non-equity incentive plan compensation figures represent amounts earned during each respective fiscal year, regardless of whether part or all of such amounts were paid in subsequent fiscal year(s). (2) The amounts disclosed represent the aggregate grant date fair value of the award as calculated in accordance with FASB ASC Topic 718. The assumptions used in calculating the grant date fair value of the award disclosed in this column are set forth in Notes 2 and 8 to our audited financial statements included in our Annual Report on Form 10-K filed with the SEC on February 27, 2024. These amounts do not correspond to the actual value that may be recognized by the named executive officer upon vesting of the applicable awards. (3) Dr. Rosenthal’s annual bonus based on the achievement of company objectives for the fiscal year ended December 31, 2022 was converted into an award of 42,990 restricted stock units under the Company’s 2019 Plan. One hundred percent of the restricted stock units were immediately vested upon the grant of the award on March 3, 2023. This award is listed in the “Grants of Plan-Based Awards” table below. (4) The amount reported consisted of (i) life insurance premiums of $4,238, (ii) a 401(k) match of $3,973, and (iii) an HSA match of $2,400, paid by us on behalf of Dr. Rosenthal. (5) Dr. Grasso was not employed by Alector and therefore was not a named executive officer for fiscal year 2021. (6) The amount reported constitutes a signing bonus of $103,000 awarded to Dr. Grasso at the commencement of his employment with Alector. The Signing Bonus was paid in one lump sum on the first regularly scheduled pay date in 2022 after the commencement of Dr. Grasso’s employment. (7) The amounts reported represent bonuses based on the achievement of company objectives for the fiscal year ended December 31, 2022, which were paid in March 2023. (8) The amount reported consisted of (i) life insurance premiums of $1,242 and (ii) a 401(k) match of $5,000, paid by us on behalf of Dr. Grasso. (9) The amount reported consisted of (i) life insurance premiums of $2,322 and (ii) a 401(k) match of $5,000, paid by us on behalf of Dr. Kenkare-Mitra. (10) The amount reported constitutes a signing bonus of $500,000 awarded to Dr. Kenkare-Mitra at the commencement of her employment with Alector. (11) Dr. Romano was not employed by Alector and therefore was not a named executive officer for fiscal year 2021. (12) The amount reported consisted of (i) life insurance premiums of $3,564 and (ii) a 401(k) match of $5,000, paid by us on behalf of Dr. Romano. The amounts reported represent bonuses based on the achievement of company objectives for the fiscal year ended December 31, 2023, which were paid in March 2024.

  38. Grants of Plan-Based Awards

    Grants of Plan-Based Awards The following table provides information regarding grants of plan-based awards to each of our named executive officers during the fiscal year ended December 31, 2023.

  39. Grants of Plan-Based Awards

    | | | Estimated Possible Payouts Under Non-Equity Incentive Plan Awards($)(1) | | All Stock Awards: Number of Shares of | All Option Awards: Number of Securities Underlying | Exercise or Base Price of | Grant Date Fair Value of Stock and | | Name | Grant Date | Target ($) | Maximum ($) | Stock or Units (#)(2) | Options (#)(3) | Option Awards ($/Sh) | Option Awards ($)(4) | | Arnon Rosenthal, Ph.D. | — | 395,010 | 592,515 | — | — | — | — | | | 3/3/2023(5) | — | — | 42,990 | 339,191 | — | — | | | 10/1/2023 | — | — | — | 132,500 | 6.48 | 614,323 | | | 10/1/2023 | — | — | 397,600 | — | — | 2,576,448 | | Marc Grasso, M.D. | — | 200,000 | 300,000 | — | — | — | — | | | 10/1/2023 | — | — | — | 41,000 | 6.48 | 190,092 | | | 10/1/2023 | — | — | 123,000 | — | — | 797,040 | | Sara Kenkare -Mitra, Ph.D. | — | 604,200 | 906,300 | — | — | — | — | | | 10/1/2023 | — | — | — | 54,500 | 6.48 | 252,684 | | | 10/1/2023 | — | — | 163,600 | — | — | 1,060,128 | | Gary Romano, M.D., Ph.D. | — | 203,200 | 304,800 | — | — | — | — | | | 10/1/2023 | — | — | — | 36,000 | 6.48 | 166,910 | | | 10/1/2023 | — | — | 108,000 | — | — | 699,840 |

  40. Grants of Plan-Based Awards

    (1) The amounts reported in these columns represent the target and maximum amount of annual performance-based incentive bonus compensation that might have been paid to each named executive officer for 2023 performance. As there are no threshold amounts with respect to these payouts, the column “Threshold ($)” is inapplicable and therefore has been omitted from this table. The actual payouts approved for 2023 performance are shown in the “Non-Equity Incentive Plan Compensation” column of the “Summary Compensation Table.” These awards are described in further detail in the section entitled “Executive Incentive Compensation Plan.” The bonus payouts approved pursuant to the Executive Incentive Compensation Plan were paid in March 2024. (2) The amounts in this column represent the restricted stock units granted in 2023 pursuant to our 2019 Plan. (3) The amounts in this column represent the stock option awards granted in 2023 pursuant to our 2019 Plan. The per share exercise price of the stock options is equal to the closing price of our common stock on the immediately preceding trading day of the date of grant, October 1, 2023. (4) The amounts shown are full grant date fair value in accordance with FASB ASC Topic 718. The assumptions used to calculate the grant date fair value of option awards are set forth under Notes 2 and 8 of the Notes to the Consolidated Financial Statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023 filed with the SEC on February 27, 2024. Dr. Rosenthal’s annual bonus for the fiscal year ended December 31, 2022 was converted into an award of 42,990 restricted stock units under the Company’s 2019 Plan. This award is described in the “Summary Compensation Table” above.

  41. Outstanding Equity Awards at Fiscal Year-End

    Outstanding Equity Awards at Fiscal Year-End The following table presents certain information concerning equity awards held by our named executive officers, as of December 31, 2023.

  42. Outstanding Equity Awards at Fiscal Year-End

    | | | Option Awards | | | | Stock Awards | | | | | Name | Grant Date | Number of Securities Underlying Unexercised Options(#) Exercisable | Number of Securities Underlying Unexercised Options(#) Unexercisable | Option Exercise Price ($)(1) | Option Expiration Date | Number of Shares of Stock That Have Not Vested(#) | Market Value of Shares That Have Not Vested ($)(2) | Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested(#) | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested($)(3) | | Arnon Rosenthal, Ph.D. | 7/2/2018(4) | 500,000(5) | — | 8.16 | 7/2/2028 | — | — | — | — | | | 11/6/2018(4) | 275,000(6) | —(6) | 10.14 | 11/6/2028 | — | — | — | — | | | 11/6/2019(7) | 520,000(8) | —(8) | 17.15 | 11/6/2029 | — | — | — | — | | | 10/1/2020(7) | 361,821(9) | 95,217(9) | 10.24 | 10/1/2030 | — | — | — | — | | | 5/7/2021(7) | — | — | — | — | — | — | 150,000(10) | 1,197,000 | | | 10/1/2021(7) | 225,990(11) | 191,223(11) | 23.70 | 10/1/2031 | — | — | — | — | | | 10/1/2022(7) | 34,838(12) | 84,608(12) | 9.46 | 10/1/2032 | — | — | — | — | | | 10/1/2022(7) | — | — | — | — | 119,447(13) | 953,187 | — | — | | | 10/1/2023(7) | 5,520(21) | 126,980(21) | 6.48 | 10/1/2033 | — | — | — | — | | | 10/1/2023(7) | — | — | — | — | 364,467(22) | 2,908,446 | — | — | | Marc Grasso, M.D. | 3/1/2022(14) | 206,250(15) | 243,750(15) | 15.49 | 3/1/2032 | — | — | — | — | | | 10/1/2022(7) | 6,941(12) | 16,860(12) | 9.46 | 10/1/2032 | — | — | — | — | | | 10/1/2022(7) | — | — | — | — | 23,802(13) | 189,940 | — | — | | | 10/1/2023(7) | 1,708(21) | 39,292(21) | 6.48 | 10/1/2033 | — | — | — | — | | | 10/1/2023(7) | — | — | — | — | 112,750(22) | 899,745 | — | — | | Sara Kenkare-Mitra, Ph.D. | 1/3/2022(14) | 150,000(16) | 150,000(16) | 20.78 | 1/3/2032 | — | — | — | — | | | 1/3/2022(14) | — | — | — | — | — | — | 59,000(17) | 470,820 | | | 1/3/2022(14) | — | — | — | — | 24,584(18) | 196,180 | — | — | | | 10/1/2022(7) | 15,626(12) | 37,950(12) | 9.46 | 10/1/2032 | — | — | — | — | | | 10/1/2022(7) | — | — | — | — | 53,578(13) | 427,552 | — | — | | | 10/1/2023(7) | 2,270(21) | 52,230(21) | 6.48 | 10/1/2033 | — | — | — | — | | | 10/1/2023(7) | — | — | — | — | 149,967(22) | 1,196,737 | — | — | | Gary Romano, Ph.D., M.D. | 5/27/2022(14) | 146,062(19) | 222,938(19) | 9.20 | 5/27/2032 | — | — | — | — | | | 5/27/2022(14) | — | — | — | — | 46,125(20) | 368,078 | — | — | | | 10/1/2022(7) | 3,898(12) | 9,467(12) | 9.46 | 10/1/2032 | — | — | — | — | | | 10/1/2022(7) | — | — | — | — | 13,366(13) | 106,661 | — | — | | | 10/1/2023(7) | 1,500(21) | 34,500(21) | 6.48 | 10/1/2033 | — | — | — | — | | | 10/1/2023(7) | — | — | — | — | 99,000(22) | 790,020 | — | — |

  43. Outstanding Equity Awards at Fiscal Year-End

    (1) This column represents the fair market value of a share of our common stock on the date of grant, as determined by our Board of Directors or its authorized committee. (2) This column represents the fair market value of the shares listed in the “Number of Shares of Stock That Have Not Vested” column, as of December 31, 2023, based on the closing price of our common stock, as reported on the Nasdaq Global Select Market, of $7.98 per share on December 29, 2023. (3) This column represents the fair market value of the shares listed in the “Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested” column, as of December 31, 2023, based on the closing price of our common stock, as reported on the Nasdaq Global Select Market, of $7.98 per share on December 29, 2023. (4) This award was granted pursuant to our 2017 Plan. (5) One forty-eighth of the total number of shares subject to the option grant vested on August 2, 2018, and an additional 1/48th of the total number of shares subject to the option grant vested each month thereafter, subject to the executive’s continued status as a service provider on each such vesting date. (6) One fourth of the total number of shares subject to the option grant vested on November 1, 2019, and an additional 1/48th of the total number of shares subject to the option grant vested each month thereafter, subject to the executive’s continued status as a service provider through each such vesting date. (7) This award was granted pursuant to our 2019 Plan. (8) The shares subject to this option vested, and continue to vest, 1/48th per month beginning on the one-month anniversary of November 6, 2019, subject to the executive’s continued status as a service provider on each such vesting date. (9) The shares subject to this option vested, and continue to vest, 1/48th per month beginning on the one-month anniversary of October 1, 2020, subject to the executive’s continued status as a service provider on each such vesting date. (10) The shares are represented by performance stock units. One-half of the award will be earned if the Company’s average closing stock price is at least $30.00 per share for forty consecutive trading days and the other one-half of the award will be earned if the average closing stock price is at least $40.00 per share for forty consecutive trading days. Upon attainment of the performance metrics, the shares vest in four equal quarterly installments beginning on the first vesting date as set forth in the performance stock unit award agreement. The shares subject to this option vested, and continue to vest, 1/48th per month beginning on November 1, 2021, subject to the executive’s continued status as a service provider on each such vesting date. The shares subject to this option vested, and continue to vest, 1/48th per month beginning on November 1, 2022, subject to the executive’s continued status as a service provider on each such vesting date. (13) The shares subject to this restricted stock unit award will vest 1/12th per quarter beginning on March 1, 2023, subject to the executive’s continued status as a service provider on each such vesting date. (14) This award was granted pursuant to our Inducement Plan. (15) The shares subject to this option vested, and continue to vest, 1/48th per month beginning on March 7, 2022, subject to the executive’s continued status as a service provider on each such vesting date. (16) One-fourth of the total number of shares subject to the option grant vested on December 15, 2022, and an additional 1/48th of the total number of shares subject to the option grant will vest each month thereafter, subject to the executive’s continued status as a service provider through each such vesting date. (17) The shares are represented by performance stock units. One-fourth of the award will be earned if the Company’s average closing stock price is at least $30.00 per share for forty consecutive trading days and the other three-fourths of the award will be earned if the average closing stock price is at least $40.00 per share for forty consecutive trading days. Upon attainment of the performance metrics, the shares vest in four equal quarterly installments beginning on the first vesting date as set forth in the performance stock unit award agreement. (18) One-third of the total number of shares subject to the restricted stock unit award will vest on March 1, 2023, and an additional 1/12th of the total number of shares subject to the restricted stock unit award will vest each quarter thereafter, subject to the executive’s continued status as a service provider through each such vesting date. (19) The shares subject to this option vested, and continue to vest, 1/48th per month beginning on June 23, 2022, subject to the executive’s continued status as a service provider on each such vesting date. (20) The shares subject to this restricted stock unit award vested, and continue to vest, 1/12th per quarter beginning on September 1, 2022, subject to the executive’s continued status as a service provider on each such vesting date. (21) The shares subject to this option vested, and continue to vest, 1/48th per month beginning on November 1, 2023, subject to the executive’s continued status as a service provider on each such vesting date. (22) The shares subject to this restricted stock unit award will vest 1/12th per quarter beginning on December 1, 2023, subject to the executive’s continued status as a service provider on each such vesting date.

  44. Potential Payments on Termination or Change in Control

    Potential Payments on Termination or Change in Control We entered into a change in control and severance agreement with each of our named executive officers which provides for certain severance and change in control benefits as described below. Each change in control and severance agreement superseded any prior agreement or arrangement the named executive officer may have had with us that provided for severance and/or change in control payments or benefits. If a named executive officer’s employment is terminated outside the period beginning on the date of a change in control and ending 12 months following that change in control (the “Change in Control Period”) either (1) by the Company or any of its subsidiaries (the “Company Group”) without “cause” (excluding by reason of death or disability) or (2) by the named executive officer for “good reason” (as such terms are defined in the named executive officer’s change in control and severance agreement), the named executive officer will receive the following benefits if he or she timely signs and does not revoke a release of claims in our favor: • a lump-sum payment equal to nine months in the case of Drs. Kenkare-Mitra, Grasso, and Romano, or 12 months in the case of Dr. Rosenthal, of the named executive officer’s annual base salary as in effect immediately prior to such termination (or if such termination is due to a resignation for good reason based on a material reduction in base salary, then as in effect immediately prior to the reduction); and • payment of premiums for coverage under the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended (COBRA), for the named executive officer and the named executive officer’s eligible dependents, if any, for up to nine months in the case of Drs. Kenkare-Mitra, Grasso, and Romano, or 12 months in the case of Dr. Rosenthal, or taxable monthly payments for the equivalent period in the event payment of the COBRA premiums would violate or be subject to an excise tax under applicable law. If, within the Change in Control Period, the named executive officer’s employment is terminated either (1) by the Company (or any of its subsidiaries) without “cause” (excluding by reason of death or disability) or (2) by the named executive officer for “good reason,” the named executive officer will receive the following benefits if the named executive officer timely signs and does not revoke a release of claims in our favor: • a lump-sum payment equal to 12 months in the case of Drs. Kenkare-Mitra, Grasso, and Romano, or 18 months in the case of Dr. Rosenthal of the named executive officer’s annual base salary as in effect immediately prior to such termination (or if such termination is due to a resignation for good reason based on a material reduction in base salary, then as in effect immediately prior to the reduction) or if greater, at the level in effect immediately prior to the change in control; • a lump-sum payment equal to 100% in the case of Drs. Kenkare-Mitra, Grasso, and Romano, or 150% in the case of Dr. Rosenthal, of the named executive officer’s target annual bonus as in effect for the fiscal year in which such termination occurs; payment of premiums for coverage under COBRA for the named executive officer and the named executive officer’s eligible dependents, if any, for up to 12 months in the case of Drs. Kenkare-Mitra, Grasso, and Romano, or 18 months in the case of Dr. Rosenthal, or taxable monthly payments for the equivalent period in the event payment of the COBRA premiums would violate or be subject to an excise tax under applicable law; and 100% accelerated vesting and exercisability of all outstanding equity awards and, in the case of an equity award with performance-based vesting, unless otherwise specified in the applicable equity award agreement governing the equity award, all performance goals and other vesting criteria generally will be deemed achieved at 100% of target levels. If any of the amounts provided for under these change in control and severance agreements or otherwise payable to our named executive officers would constitute “parachute payments” within the meaning of Section 280G of the Code and could be subject to the related excise tax, the named executive officer would be entitled to receive either full payment of benefits under his or her change in control and severance agreement or such lesser amount which would result in no portion of the benefits being subject to the excise tax, whichever results in the greater amount of after-tax benefits to the named executive officer. The change in control and severance agreements do not require us to provide any tax gross-up payments. Under each named executive officer’s change in control and severance agreement, the following definitions are used: “Cause” means: • the named executive officer’s dishonest statements or acts with respect to any Company Group member, or any current or prospective customers, suppliers, vendors, or other third parties with which such entity does business; • the named executive officer’s commission of (1) a felony or (2) any misdemeanor involving moral turpitude, deceit, dishonesty, or fraud; • the named executive officer’s failure to perform his or her assigned duties and responsibilities to the reasonable satisfaction of the applicable Company Group member, which failure continues, in the reasonable judgment of the Company Group member, after written notice given to him or her by the Company Group member; • the named executive officer’s gross negligence, willful misconduct, or insubordination with respect to any Company Group member; or • the named executive officer’s material violation of any provision of any agreement(s) between him or her and any Company Group member relating to non-competition, non-solicitation, non-disclosure, and/or assignment of inventions (such as the at-will employment, confidential information, invention assignment, and arbitration agreement with the named executive officer or any written Company Group policy or procedure to which the named executive officer is subject). Any termination for “Cause” will require the approval of our Board of Directors, and the named executive officer will be given the opportunity to appear in person before the entire Board of Directors in order to explain the named executive officer’s position on the allegations or claims that constitute “Cause.” “Good Reason” means that the named executive officer resigns from a Company Group member if one of the following events occurs without his or her consent: •

  45. Potential Payments on Termination or Change in Control

    a material reduction of his or her duties, authorities, or responsibilities relative to his or her duties, authorities, or responsibilities in effect immediately prior to the reduction, provided that (1) any change that results in Dr. Rosenthal not serving as the chief executive officer of, or reporting directly to the Board of Directors of, the parent corporation in a group of controlled corporations including the Company or its assets (the “Parent”) following a change in control (other than as the result of his voluntary resignation not at the request of the successor or the Parent) will be deemed to constitute a material reduction in his duties, authorities, and responsibilities constituting “Good Reason” and (2) that continued employment of a named executive officer (other than Dr. Rosenthal) following a change in control with substantially the same duties, authorities, or responsibilities with respect to the Company Group’s business and operations will not constitute “Good Reason” (for example, “Good Reason” will not exist if the named executive officer is employed by the Company or a successor with substantially the same duties, authorities, or responsibilities with respect to the Company’s business that the named executive officer had immediately before the change in control regardless of whether the named executive officer’s title is revised to reflect his or her placement within the overall corporate hierarchy or whether the named executive officer provides services to a subsidiary, affiliate, business unit, or otherwise); • a material diminution in his or her base salary except for across-the-board salary reductions similarly affecting all or substantially all similarly situated employees of the applicable Company Group member, or a change of more than 50 miles in the geographic location at which he or she provides services to the applicable Company Group member. For “Good Reason” to be established, the named executive officer must provide written notice to our Chief Executive Officer (or our Board of Directors in the case of Dr. Rosenthal) and the applicable Company Group member within 90 days immediately following such alleged events, the applicable Company Group member must fail to materially remedy such event within 30 days after receipt of such notice, and the named executive officer’s resignation must be effective not later than 90 days from the occurrence of the alleged triggering event, and must not be effective until after the expiration of the notice and cure periods described above. The following table provides information concerning the estimated payments and benefits that would be provided in the circumstances described below, assuming that the triggering event took place on December 31, 2023, which is the last day of our fiscal year:

  46. Potential Payments on Termination or Change in Control

    | | Termination Without Cause or Resignation for Good Reason Not in Connection with a Change in Control | | Termination Without Cause or Resignation for Good Reason in connection with a Change in Control | | | | | Severance Payments ($)(1) | Health Care Benefits ($)(2) | Equity Acceleration ($)(3) | Severance Payments ($)(4) | Health Care Benefits ($)(5) | | Arnon Rosenthal, Ph.D. | 658,350 | 19,297 | 5,249,104 | 1,580,040 | 28,946 | | Marc Grasso, M.D. | 375,000 | 14,010 | 1,148,623 | 700,000 | 18,680 | | Sara Kenkare-Mitra, Ph.D. | 453,150 | 23,780 | 2,369,634 | 1,208,400 | 31,707 | | Gary Romano, M.D., Ph.D. | 381,000 | —(6) | 1,316,508 | 711,200 | —(6) |

  47. Potential Payments on Termination or Change in Control

    (1) The amount shown in this column for each named executive officer represents a lump-sum payment equal to nine months in the case of Drs. Kenkare-Mitra, Grasso, and Romano, or 12 months in the case of Dr. Rosenthal of the named executive officer’s annual base salary as of December 31, 2023. (2) The amount shown in this column for each named executive officer represents the value of payment of premiums for coverage under COBRA for the named executive officer and the named executive officer’s eligible dependents for up to nine months in the case of Drs. Kenkare-Mitra, Grasso, and Romano, or 12 months in the case of Dr. Rosenthal based on the assumptions used for financial reporting purposes under generally accepted accounting principles (“GAAP”). (3) The amount shown in this column for each named executive officer consists of the value of the portions of the unvested shares subject to each of the named executive officer’s outstanding equity awards for which vesting is accelerated upon the triggering event. The value of each such portion of such equity awards is calculated by multiplying (x) the closing stock price of our common stock of $7.98 per share on December 29, 2023, as reported on the Nasdaq Global Select Market (less the exercise price per share of the option) by (y) the number of shares covered by such portion of the equity award. Options that were “underwater” as of December 31, 2023 were not included as they do not have any value. In the case of an equity award with performance-based vesting, it is assumed that all performance goals and other vesting criteria will be deemed achieved at 100% of target levels. (4) The amount shown in this column for each named executive officer represents a lump-sum payment equal to 12 months in the case of Drs. Kenkare-Mitra, Grasso, and Romano, or 18 months in the case of Dr. Rosenthal of the named executive officer’s annual base salary as of December 31, 2023, plus 100% in the case of Drs. Kenkare-Mitra, Grasso, and Romano, or 150% in the case of Dr. Rosenthal of the named executive officer’s target annual bonus for 2023. (5) The amount shown in this column for each named executive officer represents the value of payment of premiums for coverage under COBRA for the named executive officer and the named executive officer’s eligible dependents for up to 12 months in the case of Drs. Kenkare-Mitra, Grasso, and Romano, or 18 months in the case of Dr. Rosenthal based on the assumptions used for financial reporting purposes under GAAP. (6) Dr. Romano opted out of medical coverage provided by the Company during the fiscal year ended December 31, 2023.

  48. Pay Versus Performance

    Pay Versus Performance As required by Section 953(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act, and Item 402(v) of Regulation S-K, the following tables and related disclosure show the relationship between (i) the total compensation for our principal executive officer (“PEO”) and other named executive officers (“NEOs”) as set forth in the Summary Compensation Table, (ii) the “compensation actually paid” (“CAP”) for our PEO and NEOs (computed in accordance with Item 402(v) of Regulation S-K), (iii) our total shareholder return (“TSR”), and (iv) our net income. This disclosure does not necessarily reflect value actually realized by our NEOs or how our Compensation Committee evaluates compensation decisions in light of Company or individual performance.

  49. Pay Versus Performance

    | Year | Summary Compensation Table Total for PEO($)(1) | Compensation Actually Paid To PEO($)(2) | Average Summary Compensation Table Total for Other NEOs($)(3) | Average Compensation Actually Paid to Other NEOs($)(4) | Value of $100 Initial Fixed Investment Based on Company Total Shareholder Return($)(5) | Value of $100 Initial Fixed Investment Based on Peer Group Total Shareholder Return($)(6) | Net Income (Loss) (in millions)($)(7) | | 2023 | 4,255,006 | 3,233,266 | 1,980,327 | 1,527,898 | 46 | 115 | (130) | | 2022 | 3,515,398 | (7,798,162) | 3,919,441 | 1,798,838 | 54 | 111 | (133) | | 2021 | 9,612,580 | 15,235,920 | 1,429,309 | 753,050 | 120 | 125 | (36) | | 2020 | 3,662,229 | 4,877,874 | 2,969,307 | 3,155,795 | 88 | 126 | (190) |

  50. Pay Versus Performance

    (1) Our PEO for each applicable year was Arnon Rosenthal, Ph.D. (2) The amounts disclosed reflect the adjustments listed in the tables below to the amounts reported in the Summary Compensation Table for our PEO:

  51. Pay Versus Performance

    | Year | Summary Compensation Table Total for PEO($) | Minus Stock and Option Awards from Summary Compensation Table($) | Plus Year-End Equity Value of Unvested Awards Granted During Fiscal Year($) | Plus Change in Value of Unvested Awards Granted in Prior Years($) | Plus Value of Awards Granted and Vested During Fiscal Year($) | Plus Change in Value of Prior Years’ Awards Vested During Fiscal Year($) | Compensation Actually Paid to PEO($) | | 2023 | 4,255,006 | (3,190,771) | 3,641,317 | (900,099) | 203,555 | (775,742) | 3,233,266 | | 2022 | 3,515,398 | (2,495,454) | 2,391,407 | (7,781,322) | 30,613 | (3,458,804) | (7,798,162) | | 2021 | 9,612,580 | (8,639,829) | 7,806,684 | 3,367,916 | 244,403 | 2,844,166 | 15,235,920 | | 2020 | 3,662,229 | (3,096,204) | 4,798,197 | (1,737,239) | 149,340 | 1,101,551 | 4,877,874 |

  52. Pay Versus Performance

    (3) Our NEOs for each applicable year were: • 2023: Marc Grasso, M.D.; Sara Kenkare-Mitra, Ph.D.; Gary Romano, M.D., Ph.D. • 2022: Marc Grasso, M.D.; Sara Kenkare-Mitra, Ph.D.; Robert King, Ph.D.; Gary Romano, M.D., Ph.D.; Linda Rubinstein • 2021: Sara Kenkare-Mitra, Ph.D.; Robert King, Ph.D.; Robert Paul, M.D., Ph.D.; Linda Rubinstein; Shehnaaz Suliman, M.D.; Calvin Yu • 2020: Robert King, Ph.D.; Robert Paul, M.D., Ph.D.; Shehnaaz Suliman, M.D.; Calvin Yu (4) The amounts disclosed reflect the adjustments listed in the tables below to the amounts reported in the Summary Compensation Table for our NEOs (excluding our PEO):

  53. Pay Versus Performance

    | Year | Average Summary Compensation Table Total for Other NEOs($)s | Minus Stock and Option Awards from Summary Compensation Table($) | Plus Year-End Equity Value of Unvested Awards Granted During Fiscal Year($) | Plus Change in Value of Unvested Awards Granted in Prior Years($) | Plus Value of Awards Granted and Vested During Fiscal Year($) | Plus Change in Value of Prior Years’ Awards Vested During Fiscal Year($) | Compensation Actually Paid to Other NEOs($) | | 2023 | 1,980,327 | (1,055,565) | 1,204,614 | (373,876) | 67,339 | (294,941) | 1,527,898 | | 2022 | 3,919,441 | (3,349,066) | 1,741,415 | (544,915) | 180,511 | (148,548) | 1,798,838 | | 2021 | 1,429,309 | (809,934) | 345,425 | (764,090) | 16,222 | 536,118 | 753,050 | | 2020 | 2,969,307 | (2,425,974) | 2,238,042 | (341,138) | 363,929 | 351,629 | 3,155,795 |

  54. Pay Versus Performance

    Total shareholder return illustrates the value, as of the last day of the applicable fiscal year, of an investment of $100 in our common stock on December 31, 2019. The peer group used for relative total shareholder return is the Nasdaq Biotechnology Index, which we also use in the stock performance graph required by Item 201(e) of Regulation S-K included in our Annual Report on Form 10-K filed with the SEC on February 27, 2024. (7) The dollar amounts reported represent the amount of net income (loss) reflected in our consolidated audited financial statements for the applicable year.

  55. Analysis of the Information Presented in the Pay Versus Performance Table

    Analysis of the Information Presented in the Pay Versus Performance Table In accordance with Item 402(v) of Regulation S-K, we are providing the following descriptions of the relationships between information presented in the Pay Versus Performance table: Compensation Actually Paid and Net Income (Loss) Alector is not a commercial-stage company, and we did not have any revenue during the periods presented, except revenue related to the agreement with AbbVie and the agreement with GSK for the license and co-development of product candidates with those parties. Consequently, we have not historically looked to net income (loss) as a performance measure for our executive compensation program. From 2020 to 2021, our net loss decreased, the “compensation actually paid” for our PEO increased, and the “compensation actually paid” for our NEOs decreased. This decrease in “compensation actually paid” for our NEOs is largely due to Dr. Kenkare-Mitra beginning employment with us in December 2021 but not receiving any equity awards in that year and Ms. Rubinstein not receiving equity awards in connection with the confidential consulting agreement we entered into with FLG Partners, LLC in connection with Ms. Rubinstein’s services. From 2021 to 2022, our net loss increased, the “compensation actually paid” for our PEO decreased, and the “compensation actually paid” for our other NEOs increased. From 2022 to 2023 our net loss decreased slightly, the “compensation actually paid” for our PEO increased, and the “compensation actually paid” for our other NEOs decreased. This increase in 2022 and decrease in 2023 in “compensation actually paid” for our other NEOs is largely due to new NEO equity awards in 2022. Compensation Actually Paid and the Company’s Total Shareholder Return The following chart sets forth the relationship between the “compensation actually paid” to our PEO, the average “compensation actually paid” to our NEOs as a group (excluding our PEO), and the Company’s total shareholder return over the period covering fiscal years 2020, 2021, 2022, and 2023. We utilize several performance measures to align executive compensation with our performance, but those are not financial performance measures, such as total shareholder return. For example, as described in more detail above in the section titled “Executive Compensation,” part of the compensation our NEOs are eligible to receive consists of annual performance-based cash bonuses which are designed to provide appropriate incentives to achieve defined annual corporate goals and to reward our NEOs for individual achievement towards these goals. Additionally, we view equity awards, which are an integral part of our executive compensation program, as related to Company performance because the value of each award increases only if the value of our common stock appreciates from the grant date and if the NEO continues employment over the vesting period. These equity awards strongly align our NEOs’ interests with those of our stockholders by providing a continuing financial incentive to maximize long-term value for our stockholders and by encouraging our NEOs to continue in our employment for the long-term. All information provided above under the “Pay Versus Performance” heading will not be deemed to be incorporated by reference in any filing of the Company under the Securities Act of 1933, as amended, whether made before or after the date hereof and irrespective of any general incorporation language in any such filing.

  56. CEO Pay Ratio

    CEO Pay Ratio Under rules adopted pursuant to the Dodd-Frank Act, we are required to calculate and disclose the total compensation paid to our median paid employee, as well as the ratio of the total compensation paid to the median employee as compared to the total compensation paid to our Chief Executive Officer (the “CEO Pay Ratio”). The paragraphs that follow describe our methodology and the resulting CEO Pay Ratio.

  57. Methodology and Pay Ratio

    Methodology and Pay Ratio After applying our CACM methodology, we identified the median employee. Once the median employee was identified, we calculated the median employee’s annual target total direct compensation in accordance with the requirements of the Summary Compensation Table. Our median employee compensation in 2023 as calculated using Summary Compensation Table requirements was $266,893. Our Chief Executive Officer’s compensation in 2023 as reported in the Summary Compensation Table was $4,255,006. Therefore, our CEO Pay Ratio for 2023 is approximately 15.9x. This information is being provided for compliance purposes and is a reasonable estimate calculated in a manner consistent with the SEC rules, based on our internal records and the methodology described above. The SEC rules for identifying the median compensated employee allow companies to adopt a variety of methodologies to apply certain exclusions and to make reasonable estimates and assumptions that reflect their employee populations and compensation practices. Accordingly, the pay ratio reported by other companies may not be comparable to the pay ratio reported above, as other companies have different employee populations and compensation practices and may use different methodologies, exclusions, estimates, and assumptions in calculating their own pay ratios. Neither the Compensation Committee nor management of Alector used the CEO Pay Ratio measure in making compensation decisions.