XML 48 R24.htm IDEA: XBRL DOCUMENT v3.25.4
Stock-Based Compensation
 12 Months Ended
Dec. 31, 2025
Share-Based Payment Arrangement [Abstract]  
Stock-Based Compensation Stock-Based Compensation
2016 Equity Incentive Plan
The 2016 Plan became effective in April 2016 and serves as the successor to the 2015 Equity Incentive Plan ("2015 Plan"). Under the 2016 Plan, the Company may grant stock options, stock appreciation rights, restricted stock awards, restricted stock units, performance awards, and stock bonuses. The 2016 Plan
provides for an initial reserve of 44,000 shares of common stock, plus 20,395 shares of common stock remaining under the 2015 Plan, and any share awards that subsequently are forfeited or lapse unexercised under the 2015 Plan. The shares reserved exclude shares of common stock reserved for issuance under the 2015 Plan.
In October 2018, the 2016 Plan was amended to increase the number of shares of common stock reserved for issuance thereunder by 70,384 shares, extend the term of the 2016 Plan through August 7, 2028, and provide for an automatic increase in the number of shares reserved for issuance thereunder on January 1 of each year for the remaining term of the plan equal to (a) 4.0% of the number of issued and outstanding shares of common stock on December 31 of the immediately preceding year, or (b) a lesser amount as approved by the board each year (the "Evergreen Provision").
In November 2023, the 2016 Plan was amended to (i) increase the number of shares of common stock reserved for issuance thereunder by 4,481,152 shares, (ii) revise the annual limit on non-employee director compensation from 4,000 shares to (a) $750,000 in total value or (b) $1,000,000 in the year of the director’s initial service as a non-employee director or in any year a director serves as chairman of the Board of Directors, in either case, applicable to fees paid in both cash and equity, (iii) remove the fixed termination date of the 2016 Plan and, (iv) revise the Evergreen Provision from 4% to 5% of issued and outstanding shares of Company common stock on December 31 of the preceding calendar year and to include shares issuable upon the exercise of pre-funded warrants and the conversion of outstanding shares of non-voting convertible preferred stock in the calculation.
As a result of the Evergreen Provision, on January 1, 2025, 2024, and 2023, an additional 3,814,905, 3,023,650, and 104,561 shares, respectively, became available for issuance under the 2016 Plan.
As of December 31, 2025, the total number of shares reserved for issuance under the 2016 Plan was 10,810,714, of which 4,827,082 shares were subject to outstanding option awards and restricted unit awards.
2018 Equity Inducement Plan
In February 2018, the board of directors approved and adopted the 2018 Equity Inducement Plan (as amended, the “2018 Plan”), which became effective on the same date. The board of directors approved an initial reserve of 44,000 shares of common stock to be used exclusively for individuals who were not previously employees or directors, or following a bona fide period of non-employment, as an inducement material to the individual entering into employment with the Company. Nonqualified stock options or restricted stock units may be granted under the 2018 Plan at the discretion of the Compensation Committee or the board of directors. The Company did not seek stockholder approval of the 2018 Plan pursuant to Nasdaq Rule 5635(c)(4).
The 2018 Plan was amended to increase the number of shares of common stock reserved for issuance by 750,000 and 1,000,000 during the years ended December 31, 2025 and 2024, respectively.
As of December 31, 2025, the total number of shares reserved for issuance under the 2018 Plan was 7,460,440, of which 6,620,097 shares were subject to outstanding awards.
Under the 2016 Plan and 2018 Plan, the Company may grant stock-based awards with service conditions (“service-based” awards), performance conditions (“performance-based” awards), and market conditions (“market-based” awards). Service-based awards granted under the 2018 Plan, 2016 Plan, and 2015 Plan generally vest over four years and expire after ten years, although awards have been granted with vesting terms less than four years.
Spyre 2023 Equity Incentive Plan
On June 22, 2023, in connection with the Asset Acquisition, the Company assumed the Amended and Restated Spyre 2023 Equity Incentive Plan (the "Spyre Equity Plan") and its outstanding and unexercised stock options, which were converted to options to purchase 2,734 shares of the Company's common stock. The acquisition-date fair value of these grants will be recognized as an expense on a pro-rata basis over the vesting period. As of December 31, 2025, none of the stock options under the 2023 Plan remained outstanding.
Parapyre Option Obligation
On June 22, 2023, in connection with the Asset Acquisition, the Company assumed the Parapyre Option Obligation which provided for an annual equity grant of warrants for Parapyre to purchase 1% of the then outstanding shares of Pre-Merger Spyre's common stock, on a fully diluted basis, on the last business day of each calendar year during the term of the Paragon Agreement, at the fair market value determined by the board of directors of Pre-Merger Spyre.
On September 29, 2023, the Company amended the Paragon Agreement to amend and restate certain terms of the option grant pertaining to the Parapyre Option Obligation, including but not limited to (i) defining that the annual equity grant of warrants is based on the outstanding shares of the Company’s common stock, on a fully-diluted basis, (ii) establishing the grant date as the last business day of 2023 and 2024, and (iii) defining the term of the warrants granted as ten years. The Company determined that the 2023 and 2024 grants are two separate grants, as there would be no obligation for the 2024 grant had the Company exercised or terminated all of the options under the Paragon Agreement prior to December 31, 2023. The service inception period for the grant precedes the grant date, with the full award being vested as of the grant date with no post-grant date service requirement. Accordingly, a liability related to the Parapyre Option Obligation was recorded pursuant to the amended Paragon Agreement during the 2023 and 2024 interim periods. The Company settled its 2024 and 2023 obligations under the Parapyre Option Obligation by issuing Parapyre 848,184 and 684,407 warrants, respectively, to purchase the Company's common stock at an exercise price per share per warrant of $23.28 and $21.52, respectively. There was no similar expense for the year ended December 31, 2025.
The following table summarizes stock option activity for the year ended December 31, 2025:
Shares
Issuable
Under
Options
Weighted
Average
Exercise
Price
Weighted
Average
Remaining
Contractual
Term
Aggregate
Intrinsic
Value
(in years)
(in thousands)
Outstanding as of December 31, 20249,253,158$15.08 8.80$90,016 
Granted2,623,21719.98 
Exercised(307,673)8.68 
Forfeited(198,455)33.38 
Outstanding as of December 31, 202511,370,247$16.06 8.16$191,198 
Options vested and expected to vest as of December 31, 202511,370,247$16.06 8.16$191,198 
Options exercisable as of December 31, 20255,164,959$14.50 7.95$95,153 
The aggregate intrinsic value of options outstanding, exercisable, vested and expected to vest were calculated as the difference between the exercise price of the options and the fair value of the Company’s common stock as of the reporting date.
For the years ended December 31, 2025, 2024, and 2023, the weighted-average grant date fair value of options granted was $19.98, $28.39, and $9.67, per share, respectively. The total intrinsic value of options exercised during the years ended December 31, 2025, 2024 and 2023 was $4.0 million, $22.7 million and $0.4 million, respectively.
There were 10,000 and 477,000 stock options issued to non-employees during the years ended December 31, 2024 and 2023, respectively. There were no stock options issued to non-employees during the year ended December 31, 2025. For the year ended December 31, 2025 and 2024, 119,250 and 139,187 non-employee stock options vested in the period, respectively. There were no non-employee stock options vested during the years ended 2023.
2016 Employee Stock Purchase Plan
The 2016 Employee Stock Purchase Plan (“2016 ESPP”) became effective in April 2016. A total of 6,600 shares of common stock were reserved for issuance under the 2016 ESPP. Eligible employees may purchase shares of common stock under the 2016 ESPP at 85% of the lower of the fair market value of the common stock as of the first or the last day of each offering period. Employees are limited to contributing 15% of the employee’s eligible compensation and may not purchase more than $25,000 of stock during any calendar year. The 2016 ESPP will terminate ten years from the first purchase date under the plan, unless terminated earlier by the board of directors.
In June 2018, the 2016 ESPP was amended to provide for an automatic annual increase in the number of shares reserved for issuance thereunder (the "Evergreen Provision") on January 1 of each year for the remaining term of the year equal to (a) 1.0% of the number of issued and outstanding shares of common stock on December 31 of the immediately preceding year, or (b) a lesser amount as approved by the board of directors each year. As a result of the operation of this provision, on January 1, 2025, 2024 and 2023, an additional 602,570, 360,571, and 26,140 shares, respectively, became available for issuance under the 2016 ESPP. As of December 31, 2025, the reserve remaining and available for future issuance under the 2016 ESPP was 972,775 shares.
In February 2023, the 2016 ESPP was amended to increase the maximum shares purchased during any one period (the "ESPP Limit") from 80 shares to 400 shares or a lesser amount determined by the board of directors and in January 2024, the 2016 ESPP was further amended to increase the ESPP Limit to 2,000 shares or a lesser amount determined by the Compensation Committee.
Effective January 1, 2026, the 2016 ESPP was amended and restated (as amended and restated, the "AR 2016 ESPP") to remove the Evergreen Provision, extend the term of the 2016 ESPP indefinitely and re-establish the offering periods, among other changes. The Company plans to submit the AR 2016 ESPP for stockholder approval at its 2026 Annual Meeting of Stockholders.
For the years ended December 31, 2025 and 2024, stock-based compensation expense related to the 2016 ESPP plan was $0.3 million and $0.1 million for the year ended December 31, 2023.
Restricted Stock Units
The following table summarizes employee restricted stock unit activity for the year ended December 31, 2025:
Shares
Weighted
Average Grant
Date Fair Value
Unvested restricted stock units as of December 31, 2024115,398$18.17 
Vested(38,466)18.17 
Unvested restricted stock units as of December 31, 202576,932$18.17 
There were no restricted stock units granted during the year ended December 31, 2025.
Stock-Based Compensation Expense
Total stock-based compensation expense recognized from the Parapyre Option Obligation, the Company’s equity incentive plans, 2018 Plan, and the 2016 ESPP for the years ended December 31, 2025, 2024, and 2023 was as follows (in thousands):
Year Ended December 31,
202520242023
Employees
Non-
Employees
Employees
Non-
Employees
Employees
Non-
Employees
Research and development (1)
$16,270 $— $9,112 $14,459 $2,910 $11,328 
General and administrative20,318 1,026 19,833 1,429 11,327 110 
Total stock-based compensation expense (2)
$36,588 $1,026 $28,945 $15,888 $14,237 $11,438 
(1)For the years ended December 31, 2024 and 2023, $14.5 million and $11.4 million, respectively, was recognized as stock compensation expense related to the Parapyre Option Obligation. There was no such expense for the year ended December 31, 2025.
(2)Of the total $36.6 million, $28.9 million and $14.2 million of employee related stock-based compensation expense for the years ended December 31, 2025, 2024 and 2023, respectively, nil, $3.6 million and $8.3 million is related to legacy Aeglea employees and directors who no longer served the Company as of the end of the respective period.
No related tax benefits were recognized for the years ended December 31, 2025, 2024, and 2023 (see Note 18).
All outstanding awards as of December 31, 2025, under the 2016 Plan and 2018 Plan, have service-based vesting conditions only.
As of December 31, 2025, the Company had an aggregate of $81.3 million of unrecognized stock-based compensation expense for options outstanding, which is expected to be recognized over a weighted average period of 2.3 years.
In determining the fair value of the stock-based awards, the Company uses the Black-Scholes option-pricing model and assumptions discussed below. Each of these inputs is subjective and generally requires significant judgment to determine.
Expected Term
The Company’s expected term represents the period that the Company’s stock-based awards are expected to be outstanding and is determined using the simplified method (based on the midpoint between the vesting date and the end of the contractual term). The Company utilizes this method due to lack of historical exercise data and the plain-vanilla nature of the Company’s stock-based awards.
Expected Volatility
The Company has limited relevant company-specific historical data to support its expected volatility since the Company's 2023 strategy and pipeline reset . As such, the Company has used an average of expected volatilities based on the volatilities of a representative group of publicly traded biopharmaceutical companies over a period equal to the expected term of the stock option grants. For purposes of identifying comparable companies, the Company selected companies with comparable characteristics to it, including enterprise value, risk profiles, position within the industry, and with historical share price information sufficient to meet the expected life of the stock-based awards. The historical volatility data was computed using the daily closing prices for the selected companies’ shares during the equivalent period of the calculated expected term of the stock-based awards. The Company intends to consistently apply this process using the same or similar comparable entities until a sufficient amount of historical information regarding the volatility of the Company’s own share price post transition becomes available.
Risk-Free Interest Rate
The risk-free interest rate is based on the U.S. Treasury zero coupon issues in effect at the time of grant for periods corresponding with the expected term of option.
Expected Dividend
The Company has never paid dividends on its common stock and has no plans to pay dividends on its common stock. Therefore, the Company used an expected dividend yield of zero.
Valuation of Stock Options and 2016 ESPP
The fair value of the stock options granted under the Company's equity incentive plans, as well as the shares available for purchase under the 2016 ESPP were determined using the Black-Scholes option-pricing model. The following table summarizes the weighted-average assumptions used in calculating the fair value of the awards:
Year Ended December 31,
202520242023
Stock Options Granted
Expected term (in years)5.996.035.88
Expected volatility76%105%107%
Risk-free interest4.33%4.06%4.37%
Dividend yield0%0%0%
2016 ESPP
Expected term (in years)0.440.500.49
Expected volatility70%84%181%
Risk-free interest4.22%5.16%4.99%
Dividend yield0%0%0%