In July 2021, the Company’s board of directors adopted and the Company’s stockholders approved the Company’s 2021 Incentive Award Plan (the 2021 Plan), which became effective in connection with the IPO. Upon the adoption of the 2021 Plan, the Company ceased making equity grants under its 2018 Equity Incentive Plan (the 2018 Plan). Under the 2021 Plan, the Company may grant stock options, restricted stock, restricted stock units, stock appreciation rights, and other stock or cash-based awards to individuals who are then employees, officers, directors or non-entity consultants of the Company. A total of 15,150,000 shares of common stock were initially reserved for issuance under the 2021 Plan. In addition, the number of shares of common stock available for issuance under the 2021 Plan will be increased annually on the first day of each fiscal year during the term of the 2021 Plan, beginning with the 2022 fiscal year, by an amount equal to the lesser of (i) 5% of the shares of common stock outstanding on the final day of the immediately preceding calendar year or (ii) such smaller number of shares as determined by the Company’s board of directors. As of December 31, 2021, there were 14,699,430 stock-based awards available for future grant under the 2021 Plan.

Subsequent to July 2021, no further awards will be granted under the 2018 Plan and all future stock-based awards will be granted under the 2021 Plan. To the extent outstanding options granted under the 2018 Plan are cancelled, forfeited or otherwise terminated without being exercised and would otherwise have been returned to the share reserve under the 2018 Plan, the number of shares underlying such awards will be available for future grant under the 2021 Plan.

Options granted are exercisable at various dates as determined upon grant and will expire no more than ten years from their date of grant. Stock options generally vest over a four-year term. The exercise price of each option shall be determined by the Company’s Board of Directors based on the estimated fair value of the Company’s stock on the date of the option grant. The exercise price shall not be less than 100% of the fair market value of the Company’s common stock at the time the option is granted. For holders of more than 10% of the Company’s total combined voting power of all classes of stock, incentive stock options may not be granted at less than 110% of the fair market value of the Company’s common stock on the date of grant and for a term that exceeds five years. Early exercise is permitted for certain grants under the 2018 Plan.

A summary of the Company’s stock option activity under the 2021 Plan and 2018 Plan is as follows (in thousands, except share and per share data and years):


						Weighted-
				Weighted-		average remaining		Aggregate
				average		contractual		intrinsic
	Shares			exercise price		term (years)		value
Outstanding at December 31, 2020		6,541,422		$	0.98		9.23	$	15,571
Granted		8,320,187			5.93
Exercised		(736,200	)		1.88
Canceled		(307,197	)		2.97
Outstanding at December 31, 2021		13,818,212		$	3.87		8.82	$	163,264
Options exercisable at December 31, 2021		3,161,831		$	1.63		8.29	$	44,119

The weighted-average grant date fair value of options granted for the years ended December 31, 2021 and 2020 was $4.16 and $0.82, respectively. As of December 31, 2021, the unrecognized compensation cost related to unvested stock option grants was $32.1 million and is expected to be recognized as expense over approximately 2.91 years. The intrinsic value of the options exercised for the years ended December 31, 2021 and 2020 was $3.1 million and $141,000, respectively.

Certain individuals were granted the ability to early exercise their stock options. The shares of common stock issued from the early exercise of unvested stock options are restricted and continue to vest in accordance with the original vesting schedule. The Company has the option to repurchase any unvested shares at the original purchase price upon any voluntary or involuntary termination. The shares purchased by the employees and non-employees pursuant to the early exercise of stock options are not deemed, for accounting purposes, to be outstanding until those shares vest. The cash received in exchange for exercised and unvested shares related to stock options granted is recorded as a liability for the early exercise of stock options on the accompanying consolidated balance sheets and will be transferred into common stock and additional paid-in capital as the shares vest. As of December 31, 2021 and 2020, there were 1,854,427 shares and 2,131,510 shares subject to repurchase by the Company, respectively. As of December 31, 2021 and 2020, the Company recorded $2.9 million and $2.5 million of liabilities associated with shares issued with repurchase rights, respectively, which is recorded in accrued expenses and other current liabilities.

In January 2019, the Company granted 250,000 options that vest based on a performance milestone. For the year ended December 31, 2021, the Company recognized $115,000 of stock-based compensation associated with the performance-based options as the performance milestone was determined to be probable as of March 31, 2021. As of December 31, 2020, the milestone for the performance-based options was not probable of achievement, and therefore, no compensation expense for performance-based options had been recognized.

The assumptions used in the Black-Scholes option pricing model to determine the fair value of the employee and nonemployee stock option grants were as follows:


	Year Ended December 31,
	2021	2020
Risk-free interest rate	0.59%-1.34%	0.37%-1.22%
Expected volatility	81.93%-85.35%	74.72%-77.81%
Expected term (in years)	6.08	6.02-6.25
Expected dividend yield	--%	--%

In July 2021, the Company’s board of directors adopted and the Company’s stockholders approved the ESPP, which became effective in connection with the IPO. The ESPP permits participants to contribute up to a specified percentage of their eligible compensation during a series of offering periods of 24 months, each comprised of four six-month purchase periods, to purchase the Company’s common stock. The purchase price of the shares will be 85% of the fair market value of the Company’s common stock on the first day of trading of the applicable offering period or on the applicable purchase date, whichever is lower. A total of 1,260,000 shares of common stock was initially reserved for issuance under the ESPP. The Company recognized $688,000 of stock-based compensation expense related to the ESPP during the year ended December 31, 2021. As of December 31, 2021, the unrecognized compensation cost related to the ESPP was $3.7 million and is expected to be recognized as expense over approximately 1.28 years. As of December 31, 2021, $102,000 has been withheld on behalf of employees for future purchase under the ESPP and is included in accrued expenses and other current liabilities on the consolidated balance sheet. As of December 31, 2021, 91,987 shares have been issued under the ESPP.

The assumptions used in the Black-Scholes option pricing model to determine the fair value of the stock to be purchased under the ESPP were as follows:


	Year Ended December 31,
	2021	2020(1)
Risk-free interest rate	0.05%-0.64%	--%
Expected volatility	70.99%-91.69%	--%
Expected term (in years)	0.39-2.00	--
Expected dividend yield	--%	--%

The Company granted 1,795,827 shares of its restricted stock in 2018, which vest 25% one year from the vesting commencement date and monthly thereafter over a three-year period. The weighted-average grant date fair value of restricted stock granted in 2018 was $0. No shares of restricted stock were granted during the years ended December 31, 2021 and 2020. The restricted stock shares are subject to forfeiture upon the stockholders’ termination of employment or service to the Company. Any shares subject to forfeiture are not deemed, for accounting purposes, to be outstanding until those shares vest. As such, the Company recognizes the measurement date fair value of the restricted stock over the vesting period as compensation expense. As of December 31, 2021 and 2020, 212,941 shares and 557,731 shares of common stock, respectively, were subject to forfeiture.

The summary of the Company’s restricted stock activity during the year ended December 31, 2021 is as follows:


	Number of			Weighted-
	restricted			average
	stock shares			grant date
	outstanding			fair Value
Nonvested at December 31, 2020		557,731		$	0.001
Vested		(344,790	)		0.001
Nonvested at December 31, 2021		212,941		$	0.001

At December 31, 2021, the total unrecognized compensation related to unvested restricted stock awards granted was $0.

The allocation of stock-based compensation for all stock awards was as follows (in thousands):


	Year Ended December 31,
	2021		2020
Research and development	$	4,957	$	348
General and administrative		3,374		449
Total	$	8,331	$	797

Common stock reserved for future issuance consisted of the following as of December 31, 2021 and 2020:


	December 31,		December 31,
	2021		2020
Conversion of preferred stock outstanding		—		57,987,216
Conversion of preferred stock in future issuance (B-2)		—		10,979,319
Stock options issued and outstanding		13,818,212		6,541,422
Awards available for future grant		14,699,430		2,314,746
Shares available for purchase under the ESPP		1,168,013		—
Total		29,685,655		77,822,703