Stock-Based Compensation

6 Months Ended

Jun. 30, 2022

Share-Based Payment Arrangement [Abstract]

Stock-Based Compensation

10.Stock-Based Compensation

Stock Incentive Plan

In March 2017, Old Tango's stockholders approved the 2017 Stock Option and Grant Plan, pursuant to which Old Tango issued stock options, restricted stock awards (“RSAs”), unrestricted stock awards, restricted stock units, or any combination of the forgoing to eligible employees, officers, directors, consultants, or other key persons who provide services to the Company.

The 2021 Stock Option and Incentive Plan (the “2021 Plan”) became effective upon the closing of the Business Combination and replaced the 2017 Stock Option and Grant Plan. The 2021 Plan allows the Company to make equity and equity-based incentive

awards to officers, employees, non-employee directors and consultants. As of June 30, 2022, the Company had 7,049,248 shares available for future issuance under the 2021 Plan.

The Company recorded stock-based compensation expense in the following expense categories in its accompanying condensed consolidated statements of operations:

	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
	(in thousands)				(in thousands)
Research and development	$	1,656	$	552	$	3,298	$	1,012
General and administrative		1,769		644		3,332		1,134
Total	$	3,425	$	1,196	$	6,630	$	2,146

Stock Option Activity

Pursuant to the terms of the Business Combination, upon the Closing Date, each option to purchase Old Tango’s common stock became an option to purchase shares of common stock of the surviving entity and was subsequently adjusted using an exchange ratio of 0.34. A retroactive adjustment has been applied to all periods presented to reflect the Business Combination and reverse recapitalization as discussed further in Note 3.

The following table summarizes the stock option activity for the six months ended June 30, 2022:

	Number of Shares			Weighted Average Exercise Price		Weighted Average Contractual Term		Aggregate Intrinsic Value
	(in years)
Options outstanding as of December 31, 2021		9,372,993		$	5.59		8.55	$	51,415,394
Granted		4,132,175			8.88
Exercised		(357,212	)		2.01
Cancelled		(713,745	)		9.47
Options outstanding as of June 30, 2022		12,434,211		$	6.56		8.59	$	9,642,834
Options exercisable as of June 30, 2022		3,096,025		$	3.16		7.01	$	6,047,673

As of June 30, 2022, total unrecognized compensation expense related to stock options was $42.5 million, which the Company expects to recognize over a remaining weighted-average period of 2.9 years.

2021 Employee Stock Purchase Plan

The 2021 Employee Stock Purchase Plan (the “2021 ESPP”) was adopted and approved by the Company’s board of directors and by the Company’s stockholders and became effective upon the closing of the Business Combination. During the six months ended June 30, 2022, the Company issued 42,553 shares of common stock under the 2021 ESPP.