Form 4: Cabaletta Bio Executive Receives Repriced Stock Options

Arun Das, Chief Business Officer of Cabaletta Bio, receives repriced stock options effective May 19, 2025, under the company's stock option and incentive plans.

Summary

• Arun Das, the Chief Business Officer of Cabaletta Bio, Inc., has received repriced stock options.
• The repricing was approved by the Issuer's board of directors on May 15, 2025, and became effective on May 19, 2025.
• The exercise price of the options has been adjusted to $1.92 per share, representing the fair market value on the repricing date.
• Das received repriced options for 18,416 shares, 35,000 shares, 100,000 shares and 150,000 shares.
• The original exercise prices for these options were $11.00, $11.47, $3.21 and $11.09 respectively.
• The options are exercisable according to the vesting schedule specified in the award agreement and the company's stock option and incentive plans.
• If the options are exercised during the Retention Period, they will revert to their original exercise price.
• The Retention Period ends on the earliest of (i) the one-year anniversary of the Repricing Date, (ii) a Sale Event, and (iii) the termination of the Reporting Person's Service Relationship due to death or disability.

Sentiment

Score: 6

Explanation: The document is neutral in tone, simply reporting a transaction. The repricing could be seen as positive for incentivizing the executive, but also potentially negative if the original options were already considered sufficient.

Positives

• The repricing of stock options may incentivize Arun Das to remain with the company and contribute to its success.
• Aligning the exercise price with the current fair market value could make the options more attractive to the executive.

Negatives

• The repricing of stock options could be perceived negatively by shareholders if it is seen as rewarding underperformance.
• The 'Retention Period' condition suggests a need to ensure the executive's continued service.

Risks

• If the executive leaves the company during the Retention Period, the benefit of the repriced options may be lost.
• The stock price could decline, making even the repriced options less valuable.

Future Outlook

The document does not contain specific forward-looking statements beyond the terms of the stock option repricing and vesting schedules.

Industry Context

Stock option repricing is a common practice in the biotech industry to incentivize employees, especially when a company's stock price has declined. It aims to retain key personnel and align their interests with those of the shareholders.

Comparison to Industry Standards

• Stock option repricing is a fairly common practice, especially in volatile sectors like biotechnology.
• Companies like Amgen and Gilead Sciences also use stock options as part of their executive compensation packages.
• The specific terms, such as the retention period and vesting schedules, are tailored to the individual company's circumstances.

Stakeholder Impact

• Shareholders may view the repricing as a positive or negative signal depending on their perception of the executive's performance and the company's prospects.
• Employees may see the repricing as a positive sign that the company is committed to retaining its key personnel.

Key Dates

Keywords

stock options, Cabaletta Bio, Arun Das, repricing, executive compensation, Form 4