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Stock-based Compensation | 12 Months Ended
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Dec. 31, 2024
Share-Based Payment Arrangement [Abstract] |
Stock-based Compensation | 11. Stock-based Compensation 2024 Equity Incentive Plan In April 2024, the Company’s board of directors adopted the 2024 Equity Incentive Plan (“2024 Plan”), which was subsequently approved by the Company’s stockholders and became effective on June 19, 2024. The 2024 Plan is the successor to the 2014 Equity Incentive Plan ("2014 Plan"). The 2014 Plan terminated on February 11, 2024 and no new grants may be made under the 2014 Plan after that date, although all outstanding awards granted under the 2014 Plan will continue to be subject to the terms and conditions as set forth in the agreements evidencing such awards and the terms of the 2014 Plan. The purpose of the 2024 Plan is to allow the Company to utilize equity incentives in order to secure and retain the services of the Company's employees, directors, and consultants, and to provide long-term incentives that align the interests of the Company's employees, directors, and consultants with the interests of the Company's stockholders. The aggregate number of shares of the Company's common stock that may be issued under the 2024 Plan will not exceed the sum of (i) 6,150,000 new shares, plus (ii) certain shares subject to outstanding awards granted under the 2014 Plan that may become available for grant under the 2024 Plan as such shares become available from time to time. As of December 31, 2024, there were 5,864,196 shares of common stock available for future issuance under the 2024 Plan. Pursuant to the terms of the 2014 Plan, on January 1, 2024 and 2023, the Company automatically added 1,916,962 and 1,901,960 shares to the total number shares of common stock available for future issuance under the 2014 Plan, respectively. 2015 Inducement Plan On March 26, 2015, the Company's board of directors adopted the 2015 Inducement Plan (“2015 Plan”). The 2015 Plan provides for the grant of nonstatutory stock options, stock appreciation rights, restricted stock awards, restricted stock unit awards, and other forms of equity compensation (collectively, stock awards), all of which may be granted to persons not previously employees or directors of the Company, or following a bona fide period of non-employment, as an inducement material to the individuals’ entering into employment with the Company within the meaning of NASDAQ Listing Rule 5635I(4). The 2015 Plan had an initial share reserve covering 45,000 shares of common stock. On June 9, 2019, April 30, 2021, and October 18, 2022, the Company’s board of directors amended the 2015 Plan, and the initial share reserve for the 2015 Plan was increased from 45,000 to 90,000, from 90,000 to 500,000, and from 500,000 to 900,000 shares of common stock, respectively. During both the years ended December 31, 2024 and 2023, there were zero granted options of the Company’s common stock under the 2015 Plan. As of December 31, 2024 and 2023, there were 637,050 and 633,590 shares of common stock available for future issuance under the 2015 Plan, respectively. Option Valuation Method The fair value of a stock option is estimated using an option-pricing model that takes into account as of the grant date the exercise price and expected life of the option, the current price of the underlying stock and its expected volatility, expected dividends on the stock, and the risk-free interest rate for the expected term of the option. The Company has used the simplified method in calculating the expected term of all option grants based on the vesting period. Compensation costs related to share-based payment transactions are recognized in the financial statements upon satisfaction of the requisite service or vesting requirements and forfeitures are recorded as incurred. The Company has elected to use the Black-Scholes option-pricing model. The Black-Scholes option-pricing model was developed for use in estimating the fair value of traded options that have no vesting restrictions and are fully transferable rather than for use in estimating the fair value of stock options subject to vesting and transferability restrictions. Using the Black-Scholes option-pricing model, the weighted-average fair value of options granted during 2024 and 2023 was $1.31 and $1.29 per option, respectively. The aggregate fair value of options granted during 2024 and 2023 was $1.4 million and $0.4 million, respectively. The assumptions used to estimate fair value and the resulting grant date fair values are as follows:
|  | Employee |  |  | Non-employee |
|  | Years Ended December 31, |  |  | Years Ended December 31, |
|  | 2024 |  |  | 2023 |  |  | 2024 |  |  | 2023 |
Weighted average expected volatility |  |  | 80.94 | % |  |  | 74.77 | % |  |  | 83.83 | % |  |  | 80.12 | %
Weighted average risk-free interest rate |  |  | 4.04 | % |  |  | 3.98 | % |  |  | 4.26 | % |  |  | 3.89 | %
Weighted average expected term (in years) |  |  | 6.02 |  |  |  | 6.04 |  |  |  | 5.50 |  |  |  | 5.50 |
The activity for the 2014 Plan, 2024 Plan and 2015 Plan for the years ended December 31, 2024 is summarized as follows:
|  | Number of Shares |  |  | Weighted- Average Exercise Price |  |  | Weighted- Average Remaining Contractual Life (in years) |  |  | Aggregate Intrinsic Value ($000) |
Outstanding — December 31, 2023 |  |  | 1,867,795 |  |  | $ | 10.72 |  |  |  | 6.10 |  |  | $ | 184 |
Granted |  |  | 1,070,060 |  |  | $ | 1.84 |  |  |  |  |  |  |
Forfeited/expired |  |  | (32,826 | ) |  | $ | 35.93 |  |  |  |  |  |  |
Outstanding — December 31, 2024 |  |  | 2,905,029 |  |  | $ | 7.16 |  |  |  | 6.62 |  |  | $ | — |
Exercisable — December 31, 2024 |  |  | 1,746,457 |  |  | $ | 10.60 |  |  |  | 5.14 |  |  | $ | — |
Vested or expected to vest —December 31, 2024 |  |  | 2,905,029 |  |  | $ | 7.16 |  |  |  | 6.62 |  |  | $ | — |
The intrinsic values in the table above represent the total intrinsic value (the difference between the Company’s closing stock price as of December 31, 2024, and the exercise price multiplied by the number of options). The total fair value of shares vested for the years ended December 31, 2024 and 2023 was $0.9 million and $0.7 million, respectively. As of December 31, 2024, there was approximately $1.5 million of total unrecognized compensation cost related to unvested options granted under the plans. That cost is expected to be recognized over a weighted-average period of 2.45 years. Restricted stock unit ("RSU") activity under the 2024 Plan and 2015 Plan for the years ended December 31, 2024, is summarized as follows:
|  | Number of Shares |  |  | Weighted Average Grant Date Fair Value Per Share |
Non-vested at December 31, 2023 |  |  | 1,886,374 |  |  | $ | 2.28 |
Granted |  |  | 2,025,940 |  |  | $ | 1.88 |
Vested |  |  | (720,599 | ) |  | $ | 2.88 |
Forfeited |  |  | (71,341 | ) |  | $ | 1.96 |
Non-vested at December 31, 2024 |  |  | 3,120,374 |  |  | $ | 1.89 |
The fair value of RSUs is based on the market price of the Company’s common stock on the date of grant. RSUs generally vest 33% annually over a three-year period from the date of grant. Upon vesting, the RSUs generally are net share settled to cover the required withholding tax with the remaining shares issued to the holder. The Company recognizes compensation expense for such awards ratably over the corresponding vesting period. As of December 31, 2024, there was approximately $3.8 million of total unrecognized compensation cost related to unvested RSU share-based compensation. That cost is expected to be recognized over a weighted-average period of 1.55 years. 2014 Employee Stock Purchase Plan In February 2014, the Company’s board of directors adopted the 2014 Employee Stock Purchase Plan (“2014 ESPP”), which was subsequently ratified by the Company’s stockholders and became effective on May 2, 2014. The purpose of the 2014 ESPP is to provide means by which eligible employees of the Company and of certain designated related corporations may be given an opportunity to purchase shares of the Company’s common stock, and to seek and retain services of new and existing employees and to provide incentives for such persons to exert maximum efforts for the success of the Company. In April 2023, the Company’s board of directors amended the 2014 ESPP, which was subsequently ratified by the Company’s stockholders and became effective on June 14, 2023. Common stock that may be issued under the ESPP Plan will not exceed 1,531,248 shares of common stock, which is the sum of: (i) the 4,779 shares of common stock originally approved; (ii) 26,469 shares of common stock that were added pursuant to the annual increase provision of the ESPP Plan between 2015 and 2023; and (iii) an additional 1,500,000 shares of common stock that were approved by our stockholders at the 2023 annual meeting of stockholders. The 2014 ESPP is intended to qualify as an “employee stock purchase plan” within the meaning of Section 423 of the Internal Revenue Code. During the years ended December 31, 2024 and 2023, the Company issued 45,593 and 28,896 shares of common stock under the 2014 ESPP, respectively. During the years ended December 31, 2024 and 2023, the number of shares of common stock available for issuance under the ESPP was increased by 2,941 and 1,502,941 shares, respectively. As of December 31, 2024 and 2023, there were 1,431,393 and 1,474,045 shares of common stock available for future issuance under the 2014 ESPP, respectively. Compensation Cost The compensation cost that has been charged against income for stock awards under the 2014 Plan, 2024 Plan, 2015 Plan, and the 2014 ESPP was $3.3 million and $2.6 million for the years ended December 31, 2024 and 2023, respectively. The total income tax benefit recognized in the consolidated statements of operations for share-based compensation arrangements was zero for both the years ended December 31, 2024 and 2023. Cash received from options exercised was zero for both the years ended December 31, 2024 and 2023. Stock-based compensation expense related to stock options and stock awards is included in the following line items in the accompanying statements of operations (in thousands):
|  | Years Ended December 31, |
|  | 2024 |  |  | 2023 |
Research and development |  | $ | 988 |  |  | $ | 873 |
Selling, general and administrative |  |  | 2,358 |  |  |  | 1,751 |
Total stock-based compensation expense |  | $ | 3,346 |  |  | $ | 2,624 |

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