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Stock-Based Compensation | 3 Months Ended
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Mar. 31, 2025
Share-Based Payment Arrangement [Abstract] |
Stock-Based Compensation | Stock-Based Compensation 2021 Plan The total remaining shares of common stock authorized for issuance under the 2021 Stock Option and Incentive Plan (the "2021 Plan") increased from 7,230,834 as of December 31, 2024 to 8,389,903 as of March 31, 2025 primarily due to the automatic annual increase provision of the 2021 Plan. 2016 Plan The total remaining shares of common stock authorized for issuance under the 2016 Stock Incentive Plan as of March 31, 2025 and December 31, 2024 were 1,754,604 shares and 1,776,694 shares, respectively. 2021 Employee Stock Purchase Plan The total remaining shares of common stock authorized for issuance under the 2021 Employee Stock Purchase Plan (the "2021 ESPP") increased from 1,128,095 as of December 31, 2024 to 1,503,857 as of March 31, 2025 due to the automatic annual increase provision of the 2021 ESPP. 2025 Inducement Plan In March 2025, the Company's board of directors adopted the Entrada Therapeutics, Inc. 2025 Inducement Equity Plan (the "2025 Inducement Plan"). The 2025 Inducement Plan provides for the grant of non-qualified stock options, stock appreciation rights, restricted stock awards, restricted stock units, unrestricted stock awards, and dividend equivalent rights with respect to an aggregate of 270,000 shares of Common Stock (subject to adjustment as provided in the 2025 Inducement Plan). Awards under the 2025 Inducement Plan may only be granted to new employees who were not previously employed by the Company or its affiliates, as an inducement material to such new employees' entry into employment with the Company or its affiliates, in accordance with the requirements of Nasdaq Stock Market Rule 5635(c)(4). As of March 31, 2025, 270,000 shares remained available for future issuance under the 2025 Inducement Plan. Stock-Based Compensation Stock-based compensation expense recorded in the condensed consolidated statements of operations and comprehensive loss is as follows (in thousands):
| Three Months Ended March 31,
| 2025 |  | 2024
Research and development expenses | $ | 2,366 |  | $ | 1,613
General and administrative expenses | 2,721 |  | 2,120
Total | $ | 5,087 |  | $ | 3,733
Stock Option Valuation The following table presents, on a weighted-average basis, the assumptions used in the Black-Scholes option-pricing model to determine the fair value of stock options granted during the three months ended March 31, 2025 and 2024:
| March 31, 2025 |  | March 31, 2024
Risk‑free interest rate | 4.05 | % |  | 4.14 | %
Expected volatility | 78 | % |  | 75 | %
Expected dividend yield | — |  |  | — |
Expected term (in years) | 6.08 |  | 6.08
Early Exercise of Unvested Stock Options Shares purchased by employees pursuant to the early exercise of stock options are not deemed, for accounting purposes, to be outstanding shares until those shares vest according to their respective vesting schedules. Cash received from employee exercises of unvested options is included in current liabilities on the balance sheet. Amounts recorded are reclassified to common stock and additional paid-in capital as the shares vest. Vesting can occur in the year of exercise and thereafter. There were no unvested shares and 1,676 unvested shares related to early exercises of stock options as of March 31, 2025 and December 31, 2024, respectively. As of March 31, 2025, there was no liability associated with the unvested early exercise of stock options. As of December 31, 2024, the liability associated with the unvested early exercise of stock options was less than $0.1 million. Stock Options The following table summarizes the Company’s stock option activity during the three months ended March 31, 2025:
| Number of Shares |  | Weighted‑ Average Exercise Price
Outstanding as of December 31, 2024 | 5,336,407 |  | $ | 11.87
Granted | 696,050 |  | 11.94
Exercised | (40,984) |  |  | 8.54
Forfeited | (38,785) |  |  | 13.54
Outstanding as of March 31, 2025 | 5,952,688 |  | $ | 11.89
Exercisable as of March 31, 2025(1) | 3,902,130 |  | $ | 11.09
(1)This represents the number of vested and unvested options exercisable as of March 31, 2025. The weighted-average grant-date fair value of stock options granted during the three months ended March 31, 2025 and 2024 was $8.37 per share and $9.43 per share, respectively. As of March 31, 2025, there was $17.3 million of unrecognized compensation cost related to unvested stock options, which is expected to be recognized over a weighted-average period of 2.50 years. Restricted Stock Units During the three months ended March 31, 2025, restricted stock units ("RSUs") were granted to employees with vesting conditions based on continued service over time. Accordingly, stock-based compensation expense for such awards is recognized using a straight-line attribution model over the vesting term of each RSU. The fair value of each RSU is based on the closing price of the Company's common stock on the date of grant. A summary of restricted stock activity during the three months ended March 31, 2025 is as follows:
| Shares |  | Weighted‑ Average Grant‑Date Fair Value
Unvested as of December 31, 2024 | 1,968,374 |  | $ | 14.14
Granted | 1,053,485 |  | $ | 12.02
Vested | (325,085) |  | $ | 13.11
Forfeited | — |  | $ | —
Unvested as of March 31, 2025 | 2,696,774 |  | $ | 13.55
As of March 31, 2025, there was $33.6 million of unrecognized stock-based compensation expense related to restricted stock that is expected to vest. These costs are expected to be recognized over a weighted-average remaining vesting period of 3.07 years. Performance Stock Units As of both March 31, 2025 and December 31, 2024, there were 438,500 PSUs outstanding. The PSUs will vest upon achievement of certain clinical milestones and continued employment thereafter. As of March 31, 2025, no PSUs were vested and no stock-based compensation expense was recognized as the performance conditions were not deemed probable. As of March 31, 2025, there was $6.5 million of unrecognized stock-based compensation expense related to unvested PSUs.

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