Stock-Based Compensation

12 Months Ended

Dec. 31, 2024

Stock-Based Compensation

Stock-Based Compensation

15. Stock-Based Compensation

2019 Inducement Plan

In October 2019, the Company’s Board of Directors adopted the 2019 Inducement Plan, or the 2019 Plan, which is a non-stockholder approved stock plan adopted pursuant to the “inducement exception” provided under Nasdaq Listing Rule 5635(c)(4), or Rule 5635, for the purpose of awarding (i) non-statutory stock options, (ii) restricted stock awards, (iii) restricted stock unit awards, (iv) other stock awards (collectively, the Inducement Awards) to new employees of the Company, as inducement material to such new employees entering into employment with the Company. In November

2019, the Company filed a Registration Statement on Form S-8 with the SEC covering the offering of up to 25,000 shares of its common stock, par value $0.001, pursuant to the Company’s 2019 Plan. No stock options were granted under the 2019 Plan during the years ended December 31, 2024, 2023 and 2022. Initial grants of Inducement Awards made to employees vest as to 25% on the first anniversary of the date of grant and the balance ratably over the next 36 months and subsequent grants vest monthly over a period of four years from the grant date. As of December 31, 2024, 25,000 shares remained available for grant pursuant to the Plan.

2014 Equity Incentive Plan

The Company’s 2014 Equity Incentive Plan, or the 2014 Plan, is administered by the Company’s Board of Directors or a duly authorized committee thereof, referred to as the Plan administrator. The 2014 Plan provides for the grant of incentive stock options, non-statutory stock options, restricted stock awards, restricted stock unit awards, stock appreciation rights, performance stock awards and other forms of equity compensation, collectively referred to as Stock Awards. Additionally, the 2014 Plan provides for the grant of performance cash awards. Incentive stock options may be granted only to employees. All other awards may be granted to employees, including officers, non-employee directors, and consultants. No incentive stock options may be granted under the 2014 Plan after the tenth anniversary of the effective date of the 2014 Plan. Stock Awards granted under the 2014 Plan vest at the rate specified by the Plan administrator. Initial grants of Stock Awards made to employees and non-employee consultants generally vest as to 25% on the first anniversary of the date of grant and the balance ratably over the next 36 months and subsequent grants vest monthly over a period of four years from the grant date. Stock options initially granted to members of the Company’s Board of Directors vest over a period of three years in equal quarterly installments from the date of the grant, subject to the option holder’s continued service as a director through such date. Subsequent grants to directors that are made automatically at Annual Meetings of Stockholders vest fully on the earlier of the first anniversary of the date of grant and the next Annual Meeting of Stockholders. The Plan administrator determines the term of Stock Awards granted under the 2014 Plan up to a maximum of ten years.

The aggregate number of shares of the Company’s common stock reserved for issuance under the 2014 Plan has automatically increased on January 1 of each year, beginning on January 1, 2015 and continued to increase on January 1 of each year through and including January 1, 2024, by 3% of the total number of shares of the Company’s capital stock outstanding on December 31 of the preceding calendar year, or a lesser number of shares determined by the Company’s Board of Directors. On January 1, 2024, the aggregate number of shares of common stock that may be issued pursuant to Stock Awards under the 2014 Plan automatically increased from 1,016,919 to 1,153,120. The maximum number of shares that may be issued pursuant to the exercise of incentive stock options under the 2014 Plan is 2,500,000 shares.

Restricted Stock Units

Under the 2014 Plan, the Company granted 75,323 restricted stock units, 50,098 restricted stock units, and 39,517 restricted stock units for the years ended December 31, 2024, 2023 and 2022, respectively. No restricted stock units were granted under the 2019 Inducement Plan during the years ended December 31, 2024, 2023 and 2022.

The weighted average grant date fair value per share of restricted stock units granted to employees and non-employee members of the Company’s Board of Directors during the years ended December 31, 2024, 2023 and 2022 were $7.92, $93.72, and $121.20, respectively.

As of December 31, 2024, the Company’s restricted stock units consist of time-based restricted stock units. All remaining performance-based restricted stock units either vested or were forfeited in the first quarter of 2024. For time-based restricted stock units, the Company recognizes compensation expense associated with these restricted stock units ratably over the award’s vesting period following the grant date. For performance-based restricted stock units, vesting was contingent on the achievement of certain performance targets, subject to the recipient’s continuous service through

each performance target. Recognition of compensation expense associated with these performance-based awards began when, and to the extent, the performance criteria were probable of achievement and the employee had met the service conditions.

During the years ended December 31, 2024, 2023 and 2022, the Company recognized compensation expense relating to restricted stock units as follows:

	Year Ended December 31,
	2024		2023		2022
Research and development	$	248	$	476	$	765
General and administrative		2,391		1,647		3,321
Total restricted stock unit expense	$	2,639	$	2,123	$	4,086

A summary of restricted stock unit activity related to employees and non-employee members of the Company’s Board of Directors as of and for the year ended December 31, 2024 is as follows:

		Weighted
	Number of	Average Grant
	Units	Date Fair Value
Outstanding, December 31, 2023	47,194	$	111.24
Awarded	75,323		7.92
Vested and released	(31,170)		96.24
Forfeited	(11,434)		126.84
Outstanding, December 31, 2024	79,913	$	17.51
Restricted stock units exercisable (vested and deferred), December 31, 2024	—

Stock Options

A summary of the Company’s stock option activity related to employees, non-employee members of the Board of Directors and non-employee consultants for the 2014 Plan as of and for the year ended December 31, 2024 is as follows:

		Weighted		Aggregate
	Number of	Average Exercise		Intrinsic
	Shares	Price		Value
Outstanding, December 31, 2023	658,138	$	155.88
Granted	253,760		10.32
Exercised	—		—
Forfeited	(275,941)		60.96
Expired	(295,497)		176.43
Outstanding, December 31, 2024	340,460	$	106.62	$	—
Weighted average remaining contractual life as of December 31, 2024 (in years)	7.32
Options exercisable, December 31, 2024	185,602	$	151.42	$	—
Weighted average remaining contractual life as of December 31, 2024 (in years)	6.08
Options vested and expected to vest as of December 31, 2024	340,460	$	106.62	$	—
Weighted average remaining contractual life as of December 31, 2024 (in years)	7.32

The total fair value of options vested during the years ended December 31, 2024, 2023 and 2022 was $10,768, $12,810, and $14,156, respectively. The intrinsic value of options exercised during the years ended December 31, 2024, 2023 and 2022 was $0, $476, and $118, respectively.

During the years ended December 31, 2024, 2023 and 2022, the Company granted 253,760, 167,056 and 158,327 stock options, respectively, to employees and non-employee members of the Board of Directors. There were no options granted to nonemployee consultants during the years ended December 31, 2024, 2023 and 2022. The fair values of the stock options granted to those groups were estimated using the Black-Scholes option valuation model with the following ranges of assumptions (see Note 2, Summary of Significant Accounting Policies – Stock-Based Compensation):

	Year Ended December 31,
	2024		2023		2022
Risk-free interest rate	4.12% - 4.34	%	3.38% - 4.65	%	1.70% - 4.21	%
Expected volatility	89.6% - 89.8	%	76.3% - 81.3	%	77.7% - 81.9	%
Expected dividend yield	0	%	0	%	0	%
Expected life of employee and Board options (in years)	6.25		6.25		6.25

The weighted average grant date fair value of options granted to employees and non-employee members of the Board of Directors for their Board service during the years ended December 31, 2024, 2023 and 2022 was $7.92, $69.00, and $87.00, respectively.

During the years ended December 31, 2024, 2023 and 2022, the Company recognized compensation expense relating to stock options as follows:

	Year Ended December 31,
	2024		2023		2022
Research and development	$	1,016	$	5,973	$	7,222
General and administrative		5,274		5,634		6,426
Total stock option expense	$	6,290	$	11,607	$	13,648

As of December 31, 2024, the total compensation expense relating to unvested options granted to employees and non-employee members of the Board of Directors that had not yet been recognized was $4,146, which is expected to be realized over a weighted average period of 0.84 years. The Company will issue shares upon exercise of options from common stock reserved.

The Company does not expect to realize any tax benefits from its stock option activity or the recognition of stock-based compensation expense because the Company currently has net operating losses and has a full valuation allowance against its deferred tax assets. Accordingly, no amounts related to excess tax benefits have been reported in cash flows from operations for the years ended December 31, 2024, 2023 and 2022.

Stock Award Modifications

In November 2021, the Company and the former President and CEO mutually agreed to a transition from CEO to a consulting role through June 30, 2022, if not terminated earlier per the terms of the consulting agreement. As a result, the Company modified the terms of its former CEO’s outstanding Stock Awards to (1) automatically vest any unvested stock options or time-based restricted stock units that would have vested in the twelve month period following the end of the consulting period if continuous service is achieved with the Company during such twelve-month period; (2) extend the period during which the vested stock options may be exercised through the earlier of (i) eighteen months following the separation date (November 8, 2021); or (ii) the original expiration date applicable to each of the stock options, unless

terminated earlier in accordance with the 2014 Plan, if continuous service is achieved with the Company; and (3) extend the period in which performance-based vesting milestones for restricted stock units may be achieved through March 31, 2022, if continuous service is achieved with the Company. The consulting agreement ended on June 30, 2022.

The Company determined that vested Stock Awards which had modifications due to the extension of the exercise period were Type 1 modifications pursuant to ASC 718 because those Stock Awards would have vested before and after the modification. Acceleration of vesting for the Stock Awards that would have vested in the twelve-month period following the consulting term was determined to be a Type 3 modification requiring stock compensation expense pursuant to ASC 718 because absent the modification terms, those Stock Awards would have been forfeited as of the last day that the former CEO provided continuous service as a consultant. In addition, Type 4 performance-based restricted stock units were not considered probable of achieving performance targets on the modification date, but the vesting targets were achieved with respect to 1,444 performance-based restricted stock units in February 2022, which resulted in additional stock compensation expense being recorded through June 30, 2022.

During the year ended December 31, 2022, total incremental stock compensation expense relating to modifications of stock options, time-based and performance-based restricted stock units of the former CEO was $2,563, which was included in G&A expense. Of this total amount, $1,679 was included in G&A expense in the stock option expense table above for the year ended December 31, 2022 and $884 was included in G&A expense in the restricted stock unit expense table above for the year ended December 31, 2022.