On September 27, 2021, the Company’s board of directors and stockholders approved the 2021 Equity Incentive Plan (the “2021 Plan”), which became effective on October 7, 2021, when the Company’s registration statement was declared effective by the SEC. The 2021 Plan replaced the 2019 Plan as the Company’s board of directors has determined not to make additional awards under the 2019 Plan following the closing of the Company’s initial public offering. However, the 2019 Plan will continue to govern outstanding equity awards granted under the plan. The 2021 Plan allows the Company to make equity-based and cash-based incentive awards to its officers, employees, directors and consultants. The Company has initially reserved 3,852,807 shares of its common stock for the issuance of awards under the 2021 Plan. The number of shares of common stock reserved for issuance under the 2021 Plan will automatically increase annually on the first day of each fiscal year, beginning with the fiscal year ending December 31, 2022, and continuing until (and including) the fiscal year ending December 31, 2031 by lesser of 5% of the total number of shares of common stock outstanding on December 31st of the immediately preceding fiscal year or number of shares as may be determined by the board of directors. The maximum number of shares of common stock that may be issued pursuant to the exercise of incentive options under the 2021 Plan is 7,705,614. As of December 31, 2021, options to purchase 2,515,040 shares of common stock and 48,508 restricted stock units were outstanding under the 2021 plan and 1,289,259 shares remained available for future issuance under the 2021 plan.

In 2019, the Company established the 2019 Plan, under which the Company grant options and restricted stock to its employees and certain non-employees. The maximum number of shares of common stock reserved for issuance under the 2019 Plan was 4,042,408 shares.

Options granted under the 2019 Plan include incentive stock options that can be granted only to the Company’s employees and non-statutory stock options that can be granted to the Company’s employees, consultants, advisors and directors. The 2019 Plan also permits the Company to issue restricted stock awards.

The exercise prices, vesting and other restrictions of the awards to be granted under the 2019 Plan are determined by the board of directors, except that no stock option may be issued with an exercise price less than the fair market value of the common stock at the date of the grant or have a term in excess of ten years. Options granted under the 2019 Plan are exercisable in whole or in part at any time subsequent to vesting. All the shares of common stock were issued under the 2019 Plan. As of December 31, 2021, options to purchase 3,411,929 shares of common stock were outstanding under the 2019 plan.

The following table summarizes stock option activity for the year ended December 31, 2021 (in thousands, except share and per share amounts):


	Number of Shares			Weighted Average Exercise Price		Weighted Average Remaining Contractual Term		Aggregate Intrinsic Value
						(Years)
Outstanding at December 31, 2020		220,383		$	0.64		9.4	$	348
Granted		6,351,820			10.12		9.6
Exercised		(70,396	)		2.29
Forfeited		(574,838	)		8.41
Outstanding at December 31, 2021		5,926,969		$	10.03		9.5	$	16,414
Options exercisable at December 31, 2021		1,033,510		$	5.04		9.2	$	6,125

The weighted-average grant-date fair value of options granted during the years ended December 31, 2021 and 2020, was $7.57 and $0.62 per share, respectively. The aggregate intrinsic value is calculated as the difference between the exercise price of all outstanding and exercisable stock options and the fair value of the Company’s common stock as of December 31, 2021. The intrinsic value of stock options exercised for the year ended December 31, 2021 was $0.6 million.

The Company estimated the fair value of each option on the date of grant using the Black-Scholes option pricing model applying the range of assumptions in the following table:


	Year Ended December 31,
	2021	2020
Expected volatility	72.88% - 103.41%	79.40% – 87.40%
Risk-free interest rate	0.81% - 1.36%	0.38% – 0.56%
Expected dividend yield	0.00%	0.00%
Expected term (in years)	5.25 – 7.00	6.02 – 6.08

Stock-based compensation expense related to stock options recorded in the statements of operations is as follows (in thousands):


	Year Ended December 31,
	2021		2020
Research and development	$	2,396	$	10
General and administrative		3,976		8
Total	$	6,372	$	18

The Company has an aggregate $38.1 million of gross unrecognized stock-based compensation expense as of December 31, 2021, remaining to be amortized over a weighted average period of 2.9 years. The Company has not recognized and does not expect to recognize in the near future, any tax benefit related to employee stock-based compensation expense as a result of the full valuation allowance related to its net deferred tax assets.

In 2019, the Company issued 994,650 shares of restricted common stock to the employee co-founders and certain non-employee consultants. The shares of restricted common stock were issued pursuant to standalone restricted stock purchase agreements that are independent of the 2019 Plan. The shares of restricted common stock carried a purchase price equivalent of $0.01 per share. The compensation cost was measured based on the fair value of the underlying common stock less the purchase price of the restricted common stock and the Company recognizes compensation costs over the requisite service period.

Under the terms of the restricted stock purchase agreements, the Company has a repurchase option whereby it has the right to repurchase any unvested shares upon termination at a price per share equal to the lesser of: (i) the fair market value of the Company’s common stock on the date of repurchase and (ii) the original purchase price. The shares of restricted common stock issued to the Company’s co-founders and non-employee consultants vest based on a predefined number of shares.

The Company recognized an associated deposit liability for restricted stock awards issued pursuant to standalone restricted stock purchase agreements upon issuance based on the purchase price of the awards as the unvested shares are subject to repurchase upon termination. As the awards of restricted stock vest, the Company reclassifies the deposit liability to additional paid-in capital.

In 2021, the Company issued 48,508 shares of restricted common stock to employees and certain non-employee consultants under 2021 Plan. Compensation cost related to these awards were recorded based on the Company's stock price on the date of issuance.

The following table summarizes restricted stock activity for the year ended December 31, 2021:


	Restricted Stock
	Number of Shares			Weighted Average Grant Date Fair Value
Non-vested at December 31, 2020		888,612		$	0.01
Issued		48,508			15.58
Vested		(306,998	)		0.01
Cancelled		(11,628	)		—
Non-vested at December 31, 2021		618,494		$	3.04

The aggregate fair value of restricted stock vested during the years ended December 31, 2021 and 2020, was $5 thousand and $4 thousand, respectively. The Company has recorded stock-based compensation expense related to the restricted stock of $0.1 million and $26 thousand for the years ended December 31, 2021 and 2020, respectively. The Company has an aggregate $0.7 million of gross unrecognized restricted stock-based compensation expense as of December 31, 2021, remaining to be amortized over a weighted average period of 1.5 years.

On September 27, 2021, the Company’s board of directors and stockholders approved the 2021 Employee Stock Purchase Plan (the “2021 ESPP”), which became effective on October 7, 2021, when the Company’s registration statement was declared effective by the SEC. The 2021 ESPP reserved and authorized the issuance of up to a total of 424,595 shares of common stock to participating employees. No shares are issued under 2021 ESPP plan as of the date of issuance of these consolidated financial statements.