Avalo Therapeutics Announces Inducement Grants to New Employees Under Nasdaq Listing Rule 5635(c)(4)

Avalo Therapeutics (Nasdaq: AVTX) granted inducement equity awards to two new employees under Nasdaq Listing Rule 5635(c)(4).

Rhea-AI Summary

Avalo Therapeutics (Nasdaq: AVTX) granted inducement equity awards to two new employees under Nasdaq Listing Rule 5635(c)(4).

The Compensation Committee approved nonstatutory stock options on Feb. 13, 2026 to purchase an aggregate of 82,000 shares at an exercise price of $14.26 per share, equal to the closing price on the grant date. Options vest 25% after one year, then monthly over 36 months, subject to continued service and the 2025 Inducement Award Plan terms.

Argus Feb 19 session

+6.47% close to close Open Argus

Details

News Market Reaction – AVTX

On Feb 19, the first trading day after this news, AVTX closed 6.47% above the previous close.

Data tracked by StockTitan Argus for the Feb 19 session.

Key Figures

Inducement options: 82,000 shares Option exercise price: $14.26 per share Current share price: $15.07 +5 more

Inducement options

82,000 shares

Nonstatutory stock options granted Feb 13, 2026

Option exercise price

$14.26 per share

Equal to AVTX closing price on Feb 13, 2026 grant date

Current share price

$15.07

Price prior to publication, up 5.68% over 24 hours

Shelf registration size

$750,000,000

Maximum aggregate offering under 2026 S-3 shelf

Carried forward shelf

$326,585,963

Previously registered but unsold securities under Rule 415(a)(6)

Cash & investments

$111.6M

As of September 30, 2025; funding expected into 2028

LOTUS enrollment

≈250 patients

Phase 2 AVTX‑009 LOTUS trial for hidradenitis suppurativa

Shares outstanding

18,512,757 shares

Common shares outstanding as of December 31, 2025

Historical Context

5 past events · Latest: Feb 04

5 events

1. Feb 04

   Investor conferences

   24h Move

   -10.0%

   Announcement of February 2026 investor conference participation and webcasts.

2. Nov 17

   Inducement grants

   24h Move

   +11.7%

   Inducement options totaling 114,000 shares for three new hires.

3. Nov 06

   Q3 2025 earnings

   24h Move

   -6.3%

   Q3 2025 results, cash runway into 2028, and LOTUS trial enrollment update.

4. Nov 03

   Investor conferences

   24h Move

   -7.5%

   Planned participation in four healthcare investor conferences in late 2025.

5. Oct 29

   Clinical enrollment

   24h Move

   -1.9%

   Completion of enrollment in Phase 2 LOTUS trial for AVTX‑009 in HS.

24h Move is the share-price change in the day after each event; other market factors may also have contributed.

Key Terms

nonstatutory stock options, nasdaq listing rule 5635(c)(4)

2 terms

nonstatutory stock options financial

"approved the grants of nonstatutory stock options to purchase an aggregate of 82,000 shares"

A nonstatutory stock option is a company-issued right that lets an employee or contractor buy shares later at a set price, but it does not qualify for special tax breaks. Think of it like a voucher to buy stock at today’s price; when used, the difference between market price and voucher price is taxed as ordinary income to the holder. Investors care because these options create potential share dilution, affect reported compensation costs, and influence employee incentives and cash flow when taxes and withholdings are settled.

nasdaq listing rule 5635(c)(4) regulatory

"as inducements material to the employees entering into employment with the Company in accordance with Nasdaq Listing Rule 5635(c)(4)"

NASDAQ Listing Rule 5635(c)(4) is a rule that requires a company to get approval from its shareholders before selling a large amount of its shares, usually over 20%. This helps protect investors by making sure the company doesn't flood the market with new shares without their say, which could lower the stock's value.

AI-generated analysis. How Rhea-AI works. Not financial advice.

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WAYNE, Pa., Feb. 18, 2026 (GLOBE NEWSWIRE) -- Avalo Therapeutics, Inc. (Nasdaq: AVTX), a clinical stage biotechnology company fully dedicated to developing IL-1β-based treatments for immune-mediated inflammatory diseases, today announced the grant of inducement equity awards to two new employees. The Compensation Committee of the Board of Directors of Avalo approved the grants of nonstatutory stock options to purchase an aggregate of 82,000 shares of common stock (the “Options”) as inducements material to the employees entering into employment with the Company in accordance with Nasdaq Listing Rule 5635(c)(4).

The Options were granted on February 13, 2026 and have an exercise price of $14.26 per share, which is equal to the closing price of Avalo’s common stock on the grant date. The Options will vest as to 25% of the underlying shares of common stock on the one-year anniversary of the applicable employee’s start date of employment, and the balance of the underlying shares of common stock vesting monthly thereafter over 36 months, subject to the applicable employee’s continued service relationship with Avalo through the applicable vesting dates. The Options are subject to the terms and conditions of Avalo’s 2025 Inducement Award Plan and award agreements thereunder.

About Avalo Therapeutics

Avalo Therapeutics is a clinical stage biotechnology company fully dedicated to developing IL-1β-based treatments for immune-mediated inflammatory diseases. Our lead asset, AVTX-009, is in a Phase 2 clinical trial for hidradenitis suppurativa (HS). We’re also exploring additional opportunities to make an impact in prevalent indications that have significant remaining unmet needs. For more information about Avalo, please visit www.avalotx.com.

About AVTX-009

AVTX-009 is a humanized monoclonal antibody (IgG4) that binds to interleukin-1β (IL-1β) with high affinity and neutralizes its activity. IL-1β is a pro-inflammatory cytokine that plays a central role in the pathogenesis of a wide range of human diseases.1 It activates immune cells that generate proinflammatory cytokines, including IL-6, TNF-α, and IL-17. Dysregulated IL-1β signaling is a major driver of inflammation, contributing to the progression of autoimmune disorders. IL-1β inhibition has proven effective in multiple immune-mediated inflammatory diseases.1-3

References:1Dinarello CA. Immunol Rev. 2018;281(1):8-27. 2Kany S et al. Int J Mol Sci. 2019;20(23):6008. 3Kimball AB et al. Presented at: American Academy of Dermatology; March 8-12, 2024; San Diego, CA.

Forward-Looking Statements

This press release may include forward-looking statements made pursuant to the Private Securities Litigation Reform Act of 1995. Forward-looking statements are statements that are not historical facts. Such forward-looking statements are subject to significant risks and uncertainties that are subject to change based on various factors (many of which are beyond Avalo’s control), which could cause actual results to differ from the forward-looking statements. Such statements may include, without limitation, statements with respect to Avalo’s plans, objectives, projections, expectations and intentions and other statements identified by words such as “projects,” “may,” “might,” “will,” “could,” “would,” “should,” “continue,” “seeks,” “aims,” “predicts,” “believes,” “expects,” “anticipates,” “estimates,” “intends,” “plans,” “potential,” or similar expressions (including their use in the negative), or by discussions of future matters such as: drug development costs, timing of trials and trial results and other risks, including reliance on investigators and enrollment of patients in clinical trials; reliance on key personnel; regulatory risks; general economic and market risks and uncertainties, including those caused by the war in Ukraine and the Middle East; and those other risks detailed in Avalo’s filings with the Securities and Exchange Commission, available at www.sec.gov. Actual results may differ from those set forth in the forward-looking statements. Except as required by applicable law, Avalo expressly disclaims any obligations or undertaking to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in Avalo’s expectations with respect thereto or any change in events, conditions or circumstances on which any statement is based.

For media and investor inquiries
Christopher Sullivan, CFO

Avalo Therapeutics, Inc.
ir@avalotx.com
410-803-6793

or

Meru Advisors
Lauren Glaser
lglaser@meruadvisors.com

FAQ

AI-generated questions and answers. How Rhea-AI works. Not financial advice.

What did Avalo Therapeutics (AVTX) announce on February 18, 2026 about employee stock options?

Avalo announced inducement stock options totaling 82,000 shares granted to two new employees. According to the company, options were granted on Feb. 13, 2026 with an exercise price of $14.26, equal to the closing stock price that day.

How do the AVTX inducement options vest and when do they begin vesting for new employees?

The options vest 25% after one year, then monthly over 36 months thereafter. According to the company, vesting is subject to each employee's continued service and the start-date anniversary schedule.

What is the exercise price and how was it determined for Avalo's (AVTX) Feb. 13, 2026 option grants?

The exercise price is $14.26 per share, set equal to the closing price on the grant date. According to the company, the price matches Avalo's closing common stock price on Feb. 13, 2026.

Under which plan were Avalo's (AVTX) inducement awards granted and what governs the option terms?

The awards were granted under Avalo's 2025 Inducement Award Plan, which governs option terms and conditions. According to the company, award agreements and the plan set exercise, vesting, and service requirements.