The Gyre 2023 Omnibus Incentive Plan (the “2023 Omnibus Incentive Plan”) was approved by Catalyst’s stockholders in August 2023 and ratified by Gyre’s Board in October 2023. The 2023 Omnibus Incentive Plan became effective on October 30, 2023. The 2023 Omnibus Incentive Plan permits the Company to issue up to 17,845,496 shares of common stock and will automatically increase by the lesser of (i) 5% of the total number of outstanding shares of common stock on December 31st of the preceding calendar year and (ii) such smaller number of shares of common stock as determined by Gyre's Board on the first day of each fiscal year beginning on January 1, 2024. On January 1, 2024, pursuant to the automatic increase in the number of shares reserved, an additional 3,829,780 shares of common stock were reserved and made available for issuance under the 2023 Omnibus Incentive Plan. On January 1, 2025, pursuant to the automatic increase in the number of shares reserved, an additional 4,315,377 shares of common stock were reserved and made available for issuance under the 2023 Omnibus Incentive Plan. During the six months ended June 30, 2025, certain members of senior management were granted both awards subject solely to time-based vesting requirements and awards that are subject to the achievement of certain levels of specific performance, in addition to time-based vesting requirements (the “Performance-Based Awards”). These Performance-Based Awards are subject to the achievement of certain sales metrics and approval of Hydronidone for commercialization. The number of Performance-Based Awards that may vest in full after two or three years ranges. The awards become eligible to vest only if the goals are achieved and will vest only if the grantee remains employed by us through each applicable vesting date.

The following table summarizes stock option activity for the six months ended June 30, 2025:


	Number of Shares Underlying Outstanding Options			Weighted- Average Exercise Price		Weighted- Average Remaining Contractual Term (Years)
Outstanding — December 31, 2024		18,077,869		$	1.75		6.0
Options granted		1,637,000		$	10.17
Options exercised		(1,904,995	)	$	1.04		0.0
Options forfeited and cancelled		—
Outstanding — June 30, 2025		17,809,874		$	2.60		5.9
Exercisable — June 30, 2025		15,640,870		$	1.58		5.4

The Company estimated the fair value of time-based stock options granted using the Black-Scholes option-pricing formula and a single option award approach. Due to its limited relevant historical data, the Company estimated its volatility considering a number of factors, including the use of the volatility of comparable public companies. The expected term of options granted under the 2023 Omnibus Incentive Plan, all of which qualify as “plain vanilla” per SEC Staff Accounting Bulletin 107, is determined based on the simplified method due to the Company’s limited relevant history. The risk-free rate is based on the yield of a U.S. Treasury security with a term consistent with the option. This fair value is being amortized ratably over the requisite service periods of the awards, which is generally the vesting period.

The Company also granted performance-based stock options, which vest based on performance tied to a performance target that is deemed probable as of June 30, 2025. The grant-date fair value of these awards was determined using the Black-Scholes Option Pricing Model, which incorporates key inputs such as stock price, strike price, expected volatility, risk-free interest rate, time to expiration, and a zero dividend yield.

The following table shows the weighted-average grant date fair value of options and the assumptions used to estimate the fair value for time-based awards, and for performance-based awards during the three and six months ended June 30, 2025 and 2024:


	Three Months Ended June 30,				Six Months Ended June 30,
Time-based and performance-based awards	2025			2024	2025			2024
Weighted-average grant-date fair value	$	7.01		n/a	$	7.32		$	17.86
Risk-free interest rate (%)	3.92% - 4.09%			n/a	3.92% - 4.40%				4.2	%
Expected option life (in years)	5.27 - 6.08			n/a	5.27 - 6.41				6.0
Expected dividend yield (%)		—	%	n/a		—	%		—	%
Volatility (%)	81.5% - 84.3%			n/a	81.5% - 84.3%				84.3	%

Total stock-based compensation expense recognized was as follows (in thousands):


	Three Months Ended June 30,				Six Months Ended June 30,
	2025		2024		2025		2024
General and administrative	$	830	$	16	$	1,337	$	27
Cost of revenue		47		—		47		—
Selling and marketing		29		—		29		—
Total stock-based compensation expense	$	906	$	16	$	1,413	$	27

As of June 30, 2025, the Company had an unrecognized stock-based compensation expense of $14.7 million, related to unvested stock option awards, which is expected to be recognized over an estimated weighted-average period of 3.2 years.