In March 2019, the Company adopted the 2019 Equity Incentive Plan or (“2019 Plan”), which provided for the grant of options, stock appreciation rights, restricted stock, and other stock awards. In January 2021, our board of directors adopted the 2021 Equity Incentive Plan (the “2021 Plan”). The 2021 Plan was approved by our stockholders in February 2021 and became effective immediately upon the Closing Date of the Merger. Shares available for future issuance under the 2019 Plan were canceled.

Awards. The 2021 Plan provides for the grant of incentive stock options (“ISOs”), within the meaning of Section 422 of the Code to employees, including employees of any parent or subsidiary, and for the grant of nonstatutory stock options (“NSOs”), stock appreciation rights, restricted stock awards, restricted stock unit awards, performance awards and other forms of awards to employees, directors and consultants, including employees and consultants of our affiliates.

Authorized Shares. The maximum number of shares of Class A common stock that may be issued under the 2021 Plan was initially set at 50,684,047 shares of Class A common stock. The number of shares of Class A common stock reserved for issuance under the 2021 Plan will automatically increase on January 1 of each year, starting on January 1, 2022 through January 1, 2031, in an amount equal to (1) 4.0% of the total number of shares of Class A common stock and Class B common stock outstanding or issuable upon conversion or exercise of outstanding instruments on December 31 of the preceding year, or (2) a lesser number of shares of Class A common stock determined by our board of directors prior to the date of the increase. The maximum number of shares of Class A

common stock that may be issued on the exercise of ISOs under the 2021 Plan is three times the number of shares available for issuance upon the 2021 Plan becoming effective or 152,052,141 shares.

In January 2021, our board of directors adopted the 2021 Employee Stock Purchase Plan (the “ESPP”). The ESPP was approved by our stockholders in February 2021 and became effective immediately upon the Closing Date of the Merger.

Share Reserve. The maximum number of shares of Class A common stock that may be issued under the 2021 ESPP was initially set at 4,750,354 shares of Class A common stock. The number of shares of Class A common stock reserved for issuance under the 2021 ESPP will automatically increase on January 1st of each year, beginning on January 1, 2022 and continuing through and including January 1, 2031, by 1.0% of the total number of shares of Class A common stock and Class B common stock outstanding or issuable upon conversion or exercise of outstanding instruments on December 31st of the preceding calendar year or such lesser number of shares of Class A common stock as determined by our board of directors. Shares subject to purchase rights granted under the 2021 ESPP that terminate without having been exercised in full will not reduce the number of shares available for issuance under the 2021 ESPP.

The stock-based compensation expense included in the Company’s Consolidated Statements of Operations and Comprehensive Loss for the years ended December 31, 2024 and 2023 is as follows (in thousands):


	Years ended December 31,
	2024		2023
Research and development	$	16,450	$	8,797
General and administrative		15,825		10,716
	$	32,275	$	19,513

Options granted with only service conditions generally vest over four years and expire after ten years. Stock option activity with service condition only for employees and members of the Company’s Board of Directors for the year ended December 31, 2024 is as follows:


	Shares Issuable Pursuant to Stock Options			Weighted-Average Exercise Price		Weighted-Average Remaining Contractual Term (Years)		Aggregate Intrinsic Value (in thousands)
Outstanding at December 31, 2023		26,834,045		$	3.51
Options assumed for acquisition of AnHeart		13,742,239		$	0.90
Granted		20,175,083		$	2.50
Forfeited		(1,750,547	)	$	4.12
Exercised		(5,192,263	)	$	0.86
Outstanding at December 31, 2024		53,808,557		$	2.70		7.72	$	32,475
Exercisable at December 31, 2024		24,245,561		$	2.90		6.43	$	18,147

All unvested options as of December 31, 2024 are expected to vest. The weighted average grant-date fair value of stock options outstanding on December 31, 2024 and 2023 was $2.23 and $2.57 per share, respectively. Total

unrecognized compensation costs related to non-vested stock options at December 31, 2024 was $48.4 million and is expected to be recognized within future operating results over a weighted-average period of 2.6 years.

For stock options granted with only service conditions during the years ended December 31, 2024 and 2023, the inputs in the Black-Scholes option-pricing model to determine the fair value is as follows:


	December 31,
	2024	2023
Exercise price	$0.08 - $3.83	$1.61 - $1.94
Risk-free interest rate	3.63% - 4.74%	3.47% - 4.12%
Expected volatility	72% - 75%	74% - 75%
Expected term in years	2.00 - 6.08	5.50 - 6.08
Dividend	0%	0%

The Company estimated its expected stock volatility based on the blended average of its historical volatility and of publicly traded set of peer companies. The expected term of the Company’s options has been determined utilizing the “simplified” method. The risk-free interest rate is determined by reference to the U.S. Treasury yield curve in effect at the time of grant of the award for time periods approximately equal to the expected term of the award. Dividend yield is based on the expectation that the Company will not pay any cash dividends in the foreseeable future.

Options granted with combined service, market, and performance conditions will vest based on achievement of various service conditions and either a market-based or performance-based goals in three tranches with multiple categories such as the Company’s market capitalization, and clinical and regulatory milestones. The market-based and performance-based goals period ends in October 2030. The explicit service periods are three years for tranche 1, four years for tranche 2, and five years for tranche 3. Upon the vesting requirement, 20% of the options will vest for each of tranche 1 and 2, and 60% of the options granted for tranche 3 will vest. The Company recognizes the fair value of the options within each tranche over the longer of their explicit service period or derived service period. The achievement of the performance condition was not deemed probable on the date of grant. As of December 31, 2024, the performance condition was not deemed probable. The expense recognized is based on the fair value of the market condition for the years ended December 31, 2024 and 2023. Stock option activity with combined service, market, and performance conditions for employees for the year ended December 31, 2024 is as follows:


	Shares Issuable Pursuant to Stock Options			Weighted-Average Exercise Price		Weighted-Average Remaining Contractual Term (Years)		Aggregate Intrinsic Value (in thousands)
Outstanding at December 31, 2023		3,815,194		$	6.31
Granted		250,000		$	3.23
Forfeited		(144,042	)	$	4.60
Outstanding at December 31, 2024		3,921,152		$	6.18		6.74	$	328
Exercisable at December 31, 2024		748,375		$	6.87		5.91	$	—

The weighted average grant-date fair value of stock options outstanding on December 31, 2024 and 2023 was $3.95 and $4.03 per share, respectively. Total unrecognized compensation costs related to non-vested stock options at December 31, 2024 was $3.3 million and is expected to be recognized within future operating results over a weighted-average period of 1.8 years.

The fair value of the stock options granted with combined service, market, and performance conditions was based on a Monte Carlo simulation with an embedded Black-Sholes pricing model. For the years ended December 31, 2024 and 2023, the fair value was computed using the following assumptions:


	December 31,
	2024			2023
Exercise price	$	3.23		$1.61 - $1.94
Risk-free interest rate		4.27	%	3.40% - 3.92%
Expected volatility		81	%	72% - 73%
Expected term in years		6.49		6.17 - 6.30
Dividend	0%			0%

The determination of expected volatility, risk- free rate, and dividend yield was the same approach as used for the above stock options granted with service only conditions. The expected term period represents the time used as an input in the embedded Black-Sholes pricing model which is based on the midpoint between the vest and expiration dates for each tranche.

The following table summarizes the activity for the restricted stock units assumed in the AnHeart acquisition for the year ended December 31, 2024.


	Restricted Stock
	Units
Non-vested at December 31, 2023		—
RSUs assumed for the acquisition of AnHeart		2,201,694
Granted		—
Vested		(618,340	)
Forfeited or canceled		(163,223	)
Non-vested at December 31, 2024		1,420,131

The weighted average grant-date fair value of stock options outstanding on December 31, 2024 was $3.23. Total unrecognized compensation costs related to non-vested stock options at December 31, 2024 was $0.5 million and is expected to be recognized within future operating results over a weighted-average period of 3.2 years.