Equity Incentive Plans

9 Months Ended

Sep. 30, 2024

Equity Incentive Plans

Equity Incentive Plans

10. Equity Incentive Plans

Stock Award Plans

The Company maintains a 2016 Equity Incentive Plan (the “2016 Plan”), which provides for the issuance of incentive share awards in the form of non-qualified and incentive stock options, stock appreciation rights, restricted stock awards, restricted stock unit awards and performance-based stock awards. As of September 30, 2024, there were 3,219,158 shares available for issuance under the 2016 Plan.

Stock option transactions during the nine months ended September 30, 2024 are presented below:

	Options Outstanding
				Weighted
				Average
		Weighted		Remaining
		Average		Contractual	Aggregate
		Exercise		Term	Intrinsic
	Shares	Price		(Years)	Value (in thousands)
Outstanding at December 31, 2023	3,165,216	$	5.04	5.9	$	429
Granted	1,784,054	$	3.38			—
Exercised	(37,282)	$	3.38		$	24
Forfeited/Cancelled/Expired	(977,257)	$	7.10
Outstanding at September 30, 2024	3,934,731	$	3.79	7.8	$	15
Vested and expected to vest at September 30, 2024	3,934,731	$	3.79	7.8	$	15
Exercisable at September 30, 2024	2,094,287	$	4.07	6.6	$	3

The aggregate intrinsic value of options at September 30, 2024 is based on the Company’s closing stock price on that date of $2.37 per share.

Restricted stock unit awards transactions during the nine months ended September 30, 2024 are presented below:

		Weighted Avg
		Grant Date
	Shares	Fair Value
Outstanding at December 31, 2023	200,000	$	2.39
Granted	90,000	$	3.38
Vested	(50,000)	$	2.39
Cancelled	(10,000)	$	3.38
Outstanding at September 30, 2024	230,000	$	2.73

Share-based Compensation

The Company estimates the fair value of stock options with performance and service conditions using the Black-Scholes valuation model (“Black-Scholes”). Compensation expense related to stock options granted is measured at the grant date based on the estimated fair value of the award and is recognized on the accelerated attribution method over the requisite service period.

The assumptions used in the Black-Scholes model during the three and nine months ended September 30, 2024 and 2023 are presented below.

	Three Months Ended September 30,		Nine Months Ended September 30,
	2024	2023	2024	2023
Risk-free interest rate	0%-0%	5.49%-5.54%	4.24%-4.25%	3.54% - 5.54%
Expected volatility	0% - 0%	75.40%-116.96%	89.4%-92.5%	75.40%-116.96%
Expected term (in years)	0 - 0	0.1-0.6	5.1-7.0	0.1-7.0
Expected dividend yield	0%	0%	0%	0%

The table below summarizes the total share-based compensation expense included in the Company’s condensed consolidated statements of operations for the periods presented (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2024		2023		2024		2023
Research and development	$	323	$	144	$	698	$	948
General and administrative		347		(517)		1,841		(203)
Total stock-based compensation	$	670	$	(373)	$	2,539	$	745

As of September 30, 2024, there was $3.0 million of total unrecognized compensation expense related to unvested stock options and restricted stock units, which the Company expects to recognize over the weighted average remaining period of approximately 1.9 years.