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Stock-Based Compensation
 12 Months Ended
Dec. 31, 2021
Share-based Payment Arrangement [Abstract]  
Stock-Based Compensation Stock-Based Compensation
Equity Incentive Plans
In 2015, the Company's Board of Directors adopted the 2015 Equity Incentive Plan, as amended in 2018, 2019 and 2020 (the “2015 Plan”), which provided for the grant of incentive stock options, nonqualified stock options or other awards including stock appreciation rights and restricted stock awards to the Company’s employees, officers, directors, advisors, and consultants. In May 2020, the Board of Directors adopted the 2020 Stock Option and Incentive Plan (the “2020 Plan”) and suspended the 2015 Plan. Awards outstanding under either the 2015 Plan or 2020 Plan that are cancelled, expire or otherwise terminated subsequent to May 2020 will become available for issuance as common stock under the 2020 Plan. Additionally, the 2020 Plan is subject to automatic increases on January 1 of each year beginning January 1, 2021. The number of shares added each January 1 will be equal to the lesser of: (i) 5% of the outstanding shares on the immediately preceding December 31 or (ii) such amount as determined by the administrator of the 2020 Plan, which is the compensation committee of the Board of Directors of the Company.
The 2020 Plan provides for the grant of incentive stock options, nonqualified stock options or other awards including stock appreciation rights, restricted stock awards and restricted stock units to the Company’s employees, officers, directors, advisors, and consultants. As of December 31, 2021, the 2020 Plan had 4,234,213 shares of common stock available for future issuance.
Options under the 2020 Plan may be granted for periods of up to 10 years and at prices no less than the market price of the Company’s common stock on the date of grant, provided, however, that the exercise price of an incentive stock option granted to a 10% shareholder shall not be less than 110% of the estimated fair value of the shares on the date of grant and the option is not exercisable after the expiration of five years from the date of grant.
Restricted Common Stock Awards
The Company granted restricted stock awards under the 2015 Plan. The purchase price of the restricted common stock awards was the estimated fair value as determined by the Company's Board of Directors at the issuance date. The shares vest from one to four years and vesting could be accelerated upon a change in control. A holder of an award may pay a total purchase price or a part of the purchase price for granted shares at any time during the vesting periods. Upon termination of employment, the Company has the right to repurchase any unvested restricted shares. The repurchase price for unvested shares of common stock will be the lower of (i) the fair market value on the date of repurchase or (ii) their original purchase price. During the vesting term, holders of restricted stock awards are deemed to be common stock shareholders and have dividends and voting rights.
The Company accounted for restricted stock awards as early exercised options and recognized a liability in other liabilities when cash was received for the purchase of shares of restricted stock. As shares of restricted stock vested, the Company reclassified the liability to common stock and additional paid in capital. As of December 31, 2021 and 2020, the Company recorded a liability included in accrued expenses and other liabilities of $2,000 and $10,000, respectively.
There were no grants of restricted stock awards during the years ended December 31, 2021 and 2020.
The following table summarizes restricted stock activity during the year ended December 31, 2021:
Number
of Shares		Weighted-
Average
Grant Date
fair value
Outstanding and unvested, as of December 31, 2020126,522 $1.85 
Issued— $— 
Vested(103,164)$1.78 
Repurchases(1,517)$2.12 
Outstanding and unvested, as of December 31, 202121,841 $2.16 
The aggregate fair value of restricted stock awards vested during the years ended December 31, 2021 and 2020 was $0.2 million each year. Total intrinsic value of outstanding unvested restricted stock awards as of December 31, 2021 and 2020 was $0.3 million and $2.9 million, respectively.
Incentive Stock Options and Nonqualified Stock Options
Stock options issued under either the 2015 Plan or the 2020 Plan generally vest over four years and expire ten years from the date of grant. Certain options provide for accelerated vesting if there is a change in control, as defined in the respective plans.
The Company used Black-Scholes option pricing model to estimate stock-based compensation expense for stock option awards with the following assumptions:
Year Ended December 31,
202120202019
Expected volatility74.83%-76.31%72.10%-77.50%74.80%-82.53%
Risk-free interest rate0.61 %-1.39 %0.27 %-0.82 %1.43%-2.59%
Expected dividend———
Expected term (in years)5.44-6.085.26-6.755-6.08
Underlying common stock fair value15.2-38.236.22-28.795.15-7.08
A summary of option activity under the 2015 Plan and the 2020 Plan is as follows:
Number
of
Options		Weighted-
Average Exercise
Price per Share		Weighted-
Average
Remaining
Contractual
Term (in Years)		Aggregate
Intrinsic
Value
Outstanding as of December 31, 20202,993,855 $8.18 8.84$43,890 
Granted1,520,391 $26.03 
Exercised(336,340)$5.21 
Forfeited(557,726)$16.4 
Outstanding as of December 31, 20213,620,180 $14.56 8.25$16,735 
Exercisable as of December 31, 20211,368,543 $9.76 7.66$9,426 
Vested and expected to vest as of December 31, 20213,620,180 $14.56 7.66$16,735 
Aggregate intrinsic value represents the difference between the fair value of the underlying common stock and the exercise price as of December 31, 2021 and 2020. The weighted-average grant date fair value of options granted during years ended December 31, 2021 and 2020 was $16.94 per share and $7.27 per share, respectively.
2020 Employee Stock Purchase Plan
In June 2020, the Company adopted the Company's 2020 Employee Stock Purchase Plan (the "2020 ESPP"). The Company reserved 700,000 shares of common stock for future issuance under the plan. The 2020 ESPP provides that the
number of shares reserved and available for issuance will automatically increase on January 1 of each calendar year, beginning January 1, 2021, by the least of (i) 1.0% of the total number of shares of common stock outstanding on December 31 of the preceding calendar year, (ii) 700,000 shares or (iii) such lesser amount as determined by the administrator of the 2020 ESPP, which is the compensation committee of the Board of Directors of the Company.
Under the 2020 ESPP, eligible employees may purchase shares of our common stock through payroll deductions that cannot exceed 15% of each employee’s salary. The 2020 ESPP provides for a six-month offering period. At the end of the purchase period, eligible employees are permitted to purchase shares of common stock at the lower of 85% of the fair market value at the beginning of the offering period or 85% of the fair market value at the end of the purchase period, subject to tax limitations on the total value of the purchase. The 2020 ESPP is considered a compensatory plan, and the Company recorded $0.5 million, $0.5 million and nil in stock-based compensation expense for year ended December 31, 2021, 2020 and 2019. As of December 31, 2021, 86,902 shares of common stock were issued under the 2020 ESPP. The Company used Black-Scholes option pricing model to estimate stock-based compensation expense for the 2020 ESPP with the following assumptions:
Year Ended December 31,
202120202019
Risk-free interest rate
0.06% - 0.07%
0.11%—
Expected term of options (in years)0.500.58—
Expected stock price volatility
67.16% - 89.51%
83.72%—
Expected dividends———
Stock-Based Compensation Expense
The following table presents the classification of stock-based compensation expense during the years ended December 31, 2021 and 2020 (in thousands):
Year Ended December 31,
202120202019
Research and development expenses$3,928 $1,719 $584 
General and administrative expenses6,509 2,176 1,245 
Total stock-based compensation expense$10,437 $3,895 $1,829 
As of December 31, 2021, there was $37,000 of unrecognized compensation costs that is expected to be recognized over the weighted-average periods of 0.38 years related to restricted stock awards. As of December 31, 2021, there was $24.2 million of unrecognized compensation costs that is expected to be recognized over the weighted-average periods of 2.5 years related to stock options.