Stockholders' Equity

9 Months Ended

Sep. 30, 2024

Stockholders' Equity

Stockholders' Equity

8. Stockholders’ Equity

Effective August 2014, we adopted our 2014 Equity Incentive Plan, as amended (2014 Plan), that authorizes us to grant stock options, restricted stock, and other equity-based awards, subject to adjustment in accordance with the 2014 Plan. As of September 30, 2024, 5,916,369 options to purchase shares of common stock were outstanding pursuant to grants in connection with the 2014 Plan, and no shares of common stock were available for future issuance. The amount, terms of grants, and exercisability provisions were determined and set by our board of directors. In accordance with the 2014 Plan, on January 1, 2024, the shares of common stock available for future grants under the 2014 Plan was increased to 3,090,220. No additional share are available for issuance under the 2014 Plan.

Effective May 2024, we adopted our 2024 Equity Incentive Plan (2024 Plan), that authorizes us to grant stock options, restricted stock, and other equity-based awards, up to a maximum of 4,000,000 awards, subject to adjustment in accordance with the 2024 Plan, plus shares that become available for grant as a result of the termination or forfeiture of awards under the 2014 Plan. As of September 30, 2024, 738,577 options to purchase shares of common stock were outstanding pursuant to grants in connection with the 2024 Plan, and 3,885,857 shares of common stock were available for future issuance.

Stock Options

There were 8,423,068 stock options outstanding as of September 30, 2024 at a weighted average exercise price of $8.94 per share, including 1,768,122 stock options outstanding outside of the 2014 and 2024 Plans, granted as inducements to new employees. During the nine months ended September 30, 2024, 2,430,868 options were granted to employees and directors at a weighted average exercise price of $7.11 per share. Of the options granted, 1,540,519 options were granted pursuant to the 2014 Plan, 766,374 options were granted pursuant to the 2024 Plan and 123,975 were granted outside of the 2014 and 2024 Plans as inducements for new employees.

Restricted Stock Units

All issued and outstanding restricted stock units are time-based, and generally become vested within three years of the grant date, pursuant to the 2014 and 2024 Plans. Compensation expense is recorded ratably over the requisite

service period. Compensation expense related to restricted stock units is measured based on the fair value using the closing market price of our common stock on the date of the grant. During the nine months ended September 30, 2024, we granted 1,963,350 restricted stock units, pursuant to the 2014 and 2024 Plans. As of September 30, 2024, we had 2,142,272 restricted stock units outstanding.

Total compensation cost recognized for all stock options, restricted stock awards and restricted stock units in the statements of operations is as follows (in thousands):

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2024		2023		2024		2023
Research and development	$	1,353	$	1,519	$	4,629	$	4,329
Selling, general and administrative		3,477		2,487		9,981		7,309
Restructuring costs		—		—		330		—
Total	$	4,830	$	4,006	$	14,940	$	11,638

Preferred Stock

As of September 30, 2024 all shares of our Series A Convertible Preferred Stock (Preferred Stock) had been converted and none remained outstanding. In the three and nine months ended September 30, 2024, there were no conversions of shares of our Preferred Stock into shares of our common stock. In the nine months ended September 30, 2023, 4,300 shares of our Preferred stock were converted into 860,000 shares of our common stock. In the three months ended September 30, 2023, there were no conversions of shares of our Preferred Stock into shares of our common stock.

Underwritten Public Offering

In connection with an underwritten public offering in November 2022 and the closing of the related exercise of the underwriters’ option in December 2022, we issued a total of 12,421,053 shares of common stock and 2,105,264 pre-funded warrants (the Pre-funded Warrants) resulting in aggregate net proceeds, after underwriting discounts and commissions in the public offering and fees, of $64.5 million. The exercise price and the number of shares of common stock issuable upon exercise of each Pre-funded Warrant are subject to appropriate adjustment in the event of certain stock dividends and distributions, stock splits, stock combinations, reclassifications or similar events affecting the common stock as well as upon any distribution of assets, including cash, stock or other property, to our stockholders. The Pre-funded Warrants are exercisable at any time, will not expire and are exercisable in cash or by means of a cashless exercise. A holder of Pre-funded Warrants may not exercise such Pre-funded Warrants if the holder, together with its affiliates, would beneficially own more than 9.99% of the number of shares of common stock outstanding immediately after giving effect to such exercise. A holder of Pre-funded Warrants may increase or decrease this percentage not in excess of 19.99% by providing at least 61 days’ prior notice to us.

Sales Pursuant to Equity Distribution Agreement

On July 9, 2020, we entered into an Equity Distribution Agreement (EDA) with JMP Securities LLC (JMP), as amended by the March 31, 2023 Amendment No. 1 to the EDA (Amended EDA), to create an at the market equity program under which we from time to time may offer and sell shares of our common stock without a maximum aggregate offering price. The Amended EDA was entered into in connection with our filing of a Registration Statement on Form S-3 (File No. 333-271041) with the SEC (the 2023 Registration Statement), which includes a prospectus supplement covering the offering, issuance and sale by us of up to $75,000,000 of shares of common stock that may be issued and sold under the Amended EDA. Subject to the terms and conditions of the Amended EDA, JMP will be entitled to a commission of up to 3.0% of the gross proceeds from each sale of shares of our common stock. We did not sell any shares of our common stock during the three and nine months ended September 30, 2024 and September 30, 2023 under the EDA. As of September 30, 2024, we had up to $48.6 million of shares of common stock that may be issued and sold under the Amended EDA