In January 2024, the Company’s board of directors adopted, and stockholders approved, the Company’s 2024 Equity Incentive Plan (the “2024 Plan”), which became effective on February 6, 2024. The Company initially reserved 4,215,000 shares of common stock for future issuance under the 2024 Plan. In addition, 3,960,713 shares issued and outstanding under the Company’s 2019 Equity Incentive Plan, as amended (the “2019 Plan”), may be added to the 2024 Plan as such shares become available from time to time if awards terminate, expire, or lapse for any reason without the delivery of shares, or are reacquired or withheld (or not issued) to satisfy a tax withholding obligation or the purchase or exercise price. The 2024 Plan also provides that the number of shares reserved and available for issuance will automatically increase each January 1, beginning on January 1, 2025 and ending on January 1, 2034, by an amount equal to the lesser of (i) 5% of the shares of common stock outstanding on the last day of the immediately preceding fiscal year, and (ii) such smaller number of shares of stock as determined by the Company’s board of directors. No more than 12,645,000 shares of stock may be issued upon the exercise of incentive stock options under the 2024 Plan.

The Company may grant incentive stock options (“ISOs”), nonstatutory stock options (“NSOs”), restricted stock units (“RSUs”), restricted stock awards (“RSAs”), stock appreciation rights (“SARs”), performance awards and other awards to the Company’s officers, employees, directors and consultants. Options under the 2024 Plan may be granted for periods of up to 10 years at exercise prices no less than the fair market value of the common stock on the date of grant and usually vest over four years. The exercise price of an option granted to a 10% stockholder may not be less than 110% of the fair market value of the shares on the date of grant and such option may not be exercisable after the expiration of five years from the date of grant. The grant date fair market value of all awards made under our 2024 Plan and all cash compensation paid by us to any non-employee director for services as a director in any fiscal year may not exceed $750,000, increased to $1,000,000 in the fiscal year of their initial service as a non-employee director. The 2024 Plan is the successor to the 2019 Plan and no additional awards may be granted under the 2019 Plan. All outstanding awards granted under the 2019 Plan will remain subject to the terms of the 2019 Plan. The 2019 Plan provided for the grant of incentive stock options, nonstatutory stock options, RSUs and RSAs to the Company’s officers, employees, directors and consultants.

As of September 30, 2024, ISOs, NSOs and RSUs had been granted under the 2024 Plan. As of September 30, 2024, 2,903,178 shares of the Company’s common stock were reserved for issuance under the 2024 Plan.

In January 2024, the Company’s board of directors and stockholders adopted the Company’s 2024 Employee Stock Purchase Plan (the “ESPP”), which became effective on February 6, 2024. The Company initially reserved 422,000 shares of common stock for future issuance under the ESPP. The ESPP permits participants to purchase common stock through payroll deductions of up to 15% of their eligible compensation. Employees purchase shares of common stock at a price per share equal to 85% of the lower of the fair market value at the start of the offering or on the date of purchase. The aggregate number of shares reserved for issuance under the ESPP will automatically increase each January 1, beginning on January 1, 2025 and ending on January 1, 2034, by an amount equal to the lesser of 1% of the Company's total outstanding shares of common stock on the immediately preceding December 31st, and 422,000 shares or a lesser number of shares as may be determined by the Company’s board of directors.

In September 2024, the Company adopted the 2024 Inducement Equity Incentive Plan (the “Inducement Plan”). The Inducement Plan provides for the grant of equity-based awards in the form of stock options, stock appreciation rights, restricted stock, restricted stock units, performance units and performance shares solely to prospective employees of the Company or an affiliate of the Company provided that certain criteria are met. Awards under the Inducement Plan may only be granted to an individual, as a material inducement to such individual to enter into employment with the Company or an affiliate of the Company, who (i) has not previously been an employee or director of the Company or (ii) is rehired following a bona fide period of non-employment with the Company. The Company reserved 4,000,000 shares of common stock for future issuance under the Inducement Plan. As of September 30, 2024, 2,579,259 shares were granted and 1,420,741 shares were available for future grant under the Inducement Plan.

Stock options issued under the 2019 Plan, 2024 Plan and the Inducement Plan generally vest over a four-year period and expire ten years from the date of grant. Certain options provide for accelerated vesting if there is a change in control, as defined in the individual award agreements and the Company’s severance policies.

A summary of option activity under the 2019 Plan, 2024 Plan and the Inducement Plan is as follows:


	Number of Options			Weighted- Average Exercise Price Per Share		Weighted- Average Remaining Contractual Term (in years)		Aggregate Intrinsic Value (in thousands)
Outstanding at December 31, 2023 *		4,310,034		$	4.09		9.09	$	11,810
Options granted		3,539,804		$	8.29
Options exercised *		(420,290	)	$	3.15
Options forfeited		(312,739	)	$	10.18
Options expired		(4,031	)	$	4.42
Outstanding at September 30, 2024		7,112,778		$	5.97		7.52	$	2,854
Exercisable at September 30, 2024 **		1,851,204		$	3.55		6.43	$	2,486
Vested and expected to vest at September 30, 2024		7,112,778		$	5.97		7.52	$	2,854

* Outstanding number of options as of December 31, 2023 excludes 349,321 shares of common stock issued in connection with the early exercised options for a non-recourse promissory note, which were not considered substantive for accounting purposes. These shares are included in the number of options exercised during the nine months ended September 30, 2024, upon the note forgiveness in January 2024 (see Note 9).

** Includes 885,937 shares of unvested stock options for which the holders have the right to early exercise such options as of September 30, 2024.

Aggregate intrinsic value represents the difference between the fair value of the underlying common stock and the exercise price. The weighted-average grant date fair value of options granted for the three and nine months ended September 30, 2024 was $5.43 and $6.43, respectively. The weighted-average grant date fair value of options granted for the three and nine months ended September 30, 2023 was $3.32 and $3.01, respectively. The intrinsic value of options exercised during the three and nine months ended September 30, 2024 was $0.1 million and $3.5 million, respectively, and is calculated as the difference between the exercise price and the fair value of common stock as of the exercise date. The intrinsic value of options exercised during the three and nine months ended September 30, 2023 was $0.1 million and $0.2 million, respectively.

During the nine months ended September 30, 2024, the Company granted RSU awards for 464,143 shares with a weighted-average price per share of $7.35 and performance RSU awards for 100,000 shares with a weighted-average price per share of $8.05. RSU shares vest over a four-year period. Performance RSU shares vest in full upon the Company receiving certain regulatory approvals within 36 months from the grant date. During the nine months ended September 30, 2024, 19,292 RSUs were forfeited. As of September 30, 2024, no RSU shares were vested and 544,851 RSUs remained unvested. The estimated fair value of RSUs granted was $4.2 million. The fair value of the RSUs equals the fair value of the Company's common stock as of the grant date. As of September 30, 2024, total unrecognized compensation expense for RSUs was $3.9 million, of which $3.1 million for time-vesting RSUs is expected to be recognized over weighted-average period of 3.7 years. Compensation expense of $0.8 million for performance RSUs is expected to be recognized upon satisfaction of the performance criteria.

Certain employees received stock options prior to the IPO that allow for exercise of the stock option prior to vesting. The shares of common stock issued upon an early exercise that have not yet vested are subject to repurchase by the Company in the event of termination of the holder’s continuous status as a service provider, at the price paid by the holder.

Proceeds from the early exercise of stock options are recorded as repurchase liability, and as shares vest, they are recognized as additional paid-in capital in the balance sheets. Shares purchased by employees pursuant to the early exercise of stock options are not deemed, for accounting purposes, to be issued until those shares vest according to their respective vesting schedules, and the Company recognizes stock-based compensation expense related to these options as they continue to vest. As of September 30, 2024 and December 31, 2023 , there was zero and less than $0.1 million repurchase liability related to the unvested shares, respectively. As of September 30, 2024 and December 31, 2023, zero and 8,125 common stock shares, respectively, remained subject to the right of repurchase as a result of the early exercise of stock options and are included in common stock outstanding. Early exercises as of

December 31, 2023 exclude 349,321 shares of common stock issued in connection with the early exercised options for a non-recourse promissory note, which are not considered substantive for accounting purposes (see Note 9).

The Black-Scholes option pricing model, used to estimate fair value of the option awards, requires the use of the following assumptions:

The fair value of options granted was estimated using the Black-Scholes valuation model using the following assumptions for the three and nine months ended September 30, 2024 and 2023, respectively:


	Three Months Ended September 30		Nine Months Ended September 30,
	2024	2023	2024	2023

Expected volatility	92.9%-94.0%	91% - 92%	92.9%-94.0%	91% - 95%
Expected dividend yield	0%	0%	0%	0%
Expected term (in years)	5.77-6.08	5.9 - 6.1	5.77-6.08	5.9 - 6.1
Risk-free interest rate	3.5%-4.4%	3.9%	3.5%-4.4%	3.9%

The following table presents the classification of stock-based compensation expense related to stock options granted (in thousands):


	Three Months Ended September 30,				Nine Months Ended September 30,
	2024		2023		2024		2023
Research and development	$	966	$	195	$	2,243	$	445
General and administrative		2,447		326		4,732		991
Total stock-based compensation expense	$	3,413	$	521	$	6,975	$	1,436

In January 2024, in connection with the Former CEO note forgiveness (see Note 9), the Company recognized stock-based compensation expense of $1.1 million in general and administrative expenses in the statement of operations and comprehensive loss for the nine months ended September 30, 2024. In September 2024, in connection with the entry into a separation agreement with the Former CEO, the Company recognized stock-based compensation expense of $1.7 million related to modification of certain vesting terms in the Former CEO's stock-based awards, which was recorded in general and administrative expenses in the statement of operations and comprehensive loss for the three and nine months ended September 30, 2024. As of September 30, 2024, total unrecognized stock-based compensation expense related to stock options was $27.1 million, which is expected to be recognized over weighted-average period of 3.3 years.