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Stock-Based Compensation | 6 Months Ended
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Jun. 30, 2022
Share-based Payment Arrangement [Abstract] |
Stock-Based Compensation | 11. Stock-based Compensation Stock-based Compensation Expense Total stock-based compensation expense recognized was as follows (in thousands):
|  | Three Months Ended June 30, |  |  | Six Months Ended June 30, |
|  | 2022 |  |  | 2021 |  |  | 2022 |  |  | 2021 |
Research and development |  | $ | 1,888 |  |  | $ | 825 |  |  | $ | 3,574 |  |  | $ | 2,413 |
General and administrative |  |  | 2,447 |  |  |  | 1,834 |  |  |  | 5,111 |  |  |  | 3,289 |
Total stock-based compensation |  | $ | 4,335 |  |  | $ | 2,659 |  |  | $ | 8,685 |  |  | $ | 5,702 |
Stock Options A summary of stock option activity for six months ended June 30, 2022 is set forth below:
|  | Number of Shares Underlying Outstanding Options |  |  | Weighted- Average Exercise Price |  |  | Weighted- Average Remaining Contractual Term (in years) |  |  | Aggregate Intrinsic Value (in thousands) |
Outstanding, December 31, 2021 |  |  | 3,875,317 |  |  | $ | 14.08 |  |  |  | 8.85 |  |  | $ | 13,212 |
Options authorized |  |  |  |  |  |  |  |  |  |  |  |
Options granted |  |  | 1,992,500 |  |  | $ | 14.18 |  |  |  |  |  |  |
Options exercised |  |  | (27,953 | ) |  | $ | 9.95 |  |  |  |  |  |  |
Options forfeited or cancelled |  |  | (92,020 | ) |  | $ | 12.68 |  |  |  |  |  |  |
Outstanding, June 30, 2022 |  |  | 5,747,844 |  |  | $ | 14.16 |  |  |  | 8.74 |  |  | $ | 7,050 |
Options exercisable, June 30, 2022 |  |  | 1,714,774 |  |  | $ | 13.99 |  |  |  | 8.34 |  |  | $ | 2,627 |
Vested and expected to vest, June 30, 2022 |  |  | 5,747,844 |  |  | $ | 14.16 |  |  |  | 8.74 |  |  | $ | 7,050 |
The assumptions used in the Black Scholes Model to calculate stock-based compensation are as follows:
|  | Three Months Ended June 30, |  | Six Months Ended June 30,
|  | 2022 |  | 2021 |  | 2022 |  | 2021
Fair value of common stock |  | $11.49 - $14.74 |  | $10.29 - $15.93 |  | $11.49 - $19.97 |  | $10.29 - $16.82
Expected term (years) |  | 5.5 - 6.1 |  | 0.9 - 6.1 |  | 5.5 - 6.1 |  | 0.9 - 6.1
Volatility |  | 77.4% - 79.8% |  | 77.9% - 78.6% |  | 77.4% - 79.8% |  | 77.9% - 79.8%
Risk free rates |  | 2.8% - 3.0% |  | 0.1% - 1.1% |  | 1.6% - 3.0% |  | 0.1% - 1.1%
Dividend rate |  | 0.0% |  | 0.0% |  | 0.0% |  | 0.0%
Restricted Stock Units In August 2021, the Company granted 210,750 restricted stock units (RSUs) to employees with a weighted-average grant date fair value of $7.12 per share. In October 2021, the Company granted 560,000 RSUs with service and performance conditions to certain employees, none of which vested during the three months ended June 30, 2022. Vesting of these awards is contingent on the occurrence of certain milestone events and fulfilment of any remaining service condition. As a result, the related compensation cost is recognized as an expense when achievement of the milestone is considered probable. The expense recognized for these awards is based on the grant date fair value of the Company's common stock multiplied by the number of units granted. The Company recognized $0.6 million of related expense during the three months ended June 30, 2022. The summary of RSU activity and related information for the six months ended June 30, 2022 is set forth below:
|  | Number of Units Outstanding |  |  | Weighted- Average Grant Date Fair Value |
Outstanding, December 31, 2021 |  |  | 771,660 |  |  | $ | 7.84 |
RSUs granted |  |  | — |  |  |  | — |
RSUs Vested |  |  | (224,000 | ) |  | $ | 8.02 |
RSUs forfeited |  |  | (10,500 | ) |  | $ | 7.12 |
Outstanding, June 30, 2022 |  |  | 537,160 |  |  | $ | 7.76 |
Summary of Plans The Company has a 2014 Share Option Plan (the 2014 Plan), 2015 Stock Incentive Plan (the 2015 Plan), 2017 Stock Incentive Plan (the 2017 Plan), 2018 Stock Incentive Plan (the 2018 Plan), and 2018 Employee Stock Purchase Plan (the 2018 ESPP, and, collectively with the 2014 Plan, the 2015 Plan, the 2017 Plan and the 2018 Plan, the Plans). There have been no material changes in the Plans from those disclosed in Note 18 to the consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021. In addition, on January 27, 2022, the Company established the 2022 Inducement Plan (the Inducement Plan) in accordance with Nasdaq Listing Rule 5635(c)(4). The 2014 Plan and 2015 Plan As of June 30, 2022, the number of shares of common stock available for grant under the 2014 and 2015 Plans is 56,548. As of June 30, 2022, an aggregate of 1,111,985 shares of Former Adicet common stock were issuable upon the exercise of outstanding stock options under the 2015 plan at a weighted average exercise price of $11.96 per share and an aggregate of 185,396 shares of Former Adicet common stock were issuable upon the exercise of outstanding stock options under the 2014 Plan at a weighted average exercise price of $1.61 per share. The 2017 Plan and 2018 Plan As of June 30, 2022, the number of shares of common stock available for grant under the 2017 and 2018 Plan is 2,458,652 shares. As of June 30, 2022, an aggregate of 4,415,736 shares of common stock were issuable upon the exercise of outstanding stock options under the 2017 Plan and 2018 Plans at a weighted average exercise price of $14.86 per share. Included in this amount was a grant of 6,410 performance stock units, 210,750 RSUs and 560,000 RSUs the Company granted in May 2021, August 2021 and October 2021, respectively. 2018 Employee Stock Purchase Plan On January 1, 2022, as a result of the foregoing evergreen provision, the number of shares of common stock available for issuance under the 2018 ESPP automatically increased from 524,775 to 922,144 shares. During the three months ended June 30, 2022, 16,354 shares were issued under the 2018 ESPP. As of June 30, 2022, 890,123 shares of common stock are available for issuance under the 2018 ESPP. Inducement Grants As of June 30, 2022, the number of shares of common stock available for grant under the Inducement Plan is 628,200 and an aggregate of 371,800 shares of common stock were issuable upon the exercise of inducement grants of stock options, approved by the Company in accordance with Nasdaq listing Rule 5635(c)(4) and granted under the Inducement Plan, at a weighted average exercise price of $14.03 per share. In addition, as of June 30, 2022, an aggregate of 362,503 shares of common stock were issuable upon the exercise of inducement grants of stock options, approved by the Company in accordance with Nasdaq listing Rule 5635(c)(4) prior to establishing the Inducement Plan, at a weighted average exercise price of $14.33 per share.

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