Stock-Based Compensation

12 Months Ended

Dec. 31, 2023

Share-Based Payment Arrangement [Abstract]

Note 11. Stock-Based Compensation

Stock Option Plans

On June 21, 2023, the Company held its Annual Meeting of Stockholders (the “Annual Meeting”). At the Annual Meeting, the Company’s stockholders approved an amendment to the Company’s 2020 Long Term Incentive Plan (the “2020 Plan”). The 2020 Plan, as amended, (i) reflects an increase in the limit on the aggregate number of shares of the Company’s common stock that may be delivered pursuant to all awards granted under the 2020 Incentive Plan by an additional 9,600,000 shares so that the new aggregate share limit under the 2020 Plan is 14,460,000 shares, and (ii) extends the date through which the Company may grant new awards under the 2020 Plan from November 15, 2030 to April 26, 2033.

In 2023, the Company issued stock option awards to its employees with both time-based and performance-based vesting requirements totaling 7,381,857 stock options, with 1,476,372 of the granted stock options subject to the Company’s customary time-based vesting schedule. The remaining 5,905,485 stock options granted are subject to both customary time-based vesting requirements and performance-based vesting requirements that are based on the same clinical development milestones applicable to the second and third closings of the Private Placement as specified in the Securities Purchase Agreement. Further, for the performance-based stock options granted to senior management, upon such second and third closing, a full or prorated amount of each closing shall vest based on the percentage of funding received relative to the total funding opportunity represented by the purchasers' second and third closing subscription amounts. No specified clinical development milestones were achieved during the year ended December 31, 2023.

The 2014 Plan was closed to new grants following the approval of the 2020 Plan, and therefore, there were no shares reserved for issuance under the 2014 Plan as of December 31, 2023. The number of shares reserved for issuance under the 2020 Plan and ESPP was 3,093,742 and 24,077 shares, respectively, as of December 31, 2023.

The following table summarizes all option activity under the 2007 Plan, 2014 Plan, 2020 Plan and inducement grants:


	Shares Issuable Under Options			Weighted Average Exercise Price		Weighted Average Remaining Contractual Term		Aggregate Intrinsic Value (in thousands)
						(In years)
Outstanding as of January 1, 2022		4,213,977		$	10.33		8.4	$	—
Granted		1,267,700			3.81		—		—
Forfeited / Canceled		(263,644	)		12.12		—		—
Outstanding as of December 31, 2022		5,218,033		$	8.69		8.1	$	—
Granted		11,026,451			2.10		—		—
Forfeited / Canceled		(862,631	)		8.07		—		—
Outstanding as of December 31, 2023		15,381,853		$	4.21		8.9	$	235
Options vested and expected to vest as of December 31, 2023		9,476,369		$	5.40		8.2	$	235
Options exercisable as of December 31, 2023		4,065,023		$	8.54		7.0	$	—

Intrinsic value is calculated as the difference between the exercise price of the underlying options and the fair value of the common stock for the options that had exercise prices that were lower than the fair value per share of the common stock on the date of exercise. There was no aggregate intrinsic value of options exercised during the year ended December 31, 2023.

The Company estimates the fair value of stock option awards on the grant date using the Black-Scholes option pricing model with the following weighted-average assumptions:


	Year Ended December 31,
	2023	2022
Expected stock price volatility	90.5%	83.9%
Risk-free interest rate	3.7%	2.0%
Expected life of options	6.08 years	6.27 years
Estimated dividend yield	0%	0%

The per share weighted average grant date fair value of stock options granted during the years ended December 31, 2023 and 2022 was $1.60 and $2.76, respectively.

Restricted Stock Units

The following table shows the RSU activity, as follows:


	Shares Issuable Under RSUs			Weighted Average Grant Date Fair Value
				(In years)
Outstanding as of January 1, 2022		20,000		$	5.07
Granted		15,000			2.47
RSUs Vested		(20,000	)		5.07
Forfeited / Canceled		—			—
Outstanding as of December 31, 2022		15,000		$	2.47
Granted		—			—
RSUs Vested		(15,000	)		2.47
Forfeited / Canceled		—			—
Outstanding as of December 31, 2023		—		$	—

Stock-based Compensation Expense

Total compensation expense related to all of the Company’s stock-based awards for the years ended December 31, 2023 and 2022 was comprised of the following (in thousands):


	Year Ended December 31,
	2023		2022
Stock-based compensation classified as:
Research and development expense	$	1,491	$	3,230
General and administrative expense		5,054		4,923
Total stock-based compensation expense	$	6,545	$	8,153

As of December 31, 2023, total unrecognized stock-based compensation expense related to non-vested equity awards was $12.4 million, which is expected to be recognized over an estimated weighted-average period of 2.4 years.