v3.25.2
Stockholders' Equity
6 Months Ended
Jun. 30, 2025
Stockholders' Equity Note [Abstract]  
Stockholders' Equity

10. Stockholders’ Equity

Initial Public Offering

On May 3, 2022, the Company completed its IPO whereby it sold 13,529,750 shares of common stock at a public offering price of $17.00 per share, for net proceeds of approximately $209.5 million, after deducting underwriting discounts, commissions and offering costs of approximately $20.5 million. In connection with the Company's IPO, the Company increased the number of authorized shares of the Company's common stock and preferred stock to 500,000,000 shares and 50,000,000 shares, respectively.

At-the-Market-Offering

On May 12, 2023, the Company entered into an At-the-Market Equity Offering Sales Agreement (the "Sales Agreement") with Stifel, Nicolaus & Company, Incorporated (the “Agent”), pursuant to which the Company may offer and sell shares of the Company’s common stock having an aggregate offering price of up to $100.0 million from time to time, in “at the market” offerings through the Agent. Sales of the shares of common stock, if any, will be made at prevailing market prices at the time of sale, or as otherwise agreed with the Agent. The Agent will receive a commission from the Company of up to 3.0% of the gross proceeds of any shares of common stock sold under the Sales Agreement. The Company is not obligated to sell, and the Agent is not obligated to buy or sell, any shares of common stock under the Sales Agreement. As of June 30, 2025, the Company sold 1,016,950 shares of common stock for total net proceeds of approximately $14.9 million, after deducting commission fees and offering expenses under the Sales Agreement.

Underwritten Public Offering

On September 22, 2023, the Company completed an underwritten public offering whereby it sold 9,200,000 shares of common stock, which included the exercise in full by the underwriters of their option to purchase 1,200,000 shares, at a public offering price of $12.50 per share for total net proceeds of approximately $107.8 million, after underwriting discounts and commissions and estimated offering costs.

2021 Equity Incentive Plan

On February 8, 2021, the Company’s board of directors and stockholders approved and adopted the HilleVax, Inc. 2021 Equity Incentive Plan (the “2021 Plan”). The term of the 2021 Plan is ten years from the adoption date. Under the 2021 Plan, the Company may grant stock options, restricted stock, restricted stock units, and other stock-based awards to employees, directors or consultants of the Company and its subsidiaries. The stock options granted under the plan generally vest over a four-year period from the vesting commencement date. Upon the effectiveness of the 2022 Plan defined and described below, no further grants will be made under the 2021 Plan, and any outstanding awards granted under the 2021 Plan will remain subject to the terms of the 2021 Plan and applicable award agreements.

2022 Incentive Award Plan

In April 2022, the Company’s board of directors and stockholders approved the 2022 Incentive Award Plan (the “2022 Plan,” and together with the 2021 Plan, the "Plans") under which the Company may grant stock options, restricted stock, dividend equivalents, restricted stock units, stock appreciation rights, and other stock or cash-based awards to its employees, consultants and directors. The 2022 Plan became effective in connection with the Company’s IPO and will remain in effect until the tenth anniversary of its effective date, which will be April 28, 2032, unless earlier terminated by the Company’s board of directors. The number of shares of the Company's common stock initially available for issuance under awards granted pursuant to the 2022 Plan was the sum of (1) 4,900,000 shares of the Company’s common stock, plus (2) 216,849 shares remaining available for issuance under the 2021 Plan as of the effective date of the 2022 Plan, plus (3) any shares subject to outstanding awards under the 2021 Plan as of the effective date of the 2022 Plan that become available for issuance under the 2022 Plan thereafter in accordance with its terms. The number of shares initially available for issuance will be increased by an annual increase on January 1 of each calendar year ending in and including 2032, equal to the lesser of (1) 5% of the shares of common stock outstanding on the final day of the immediately preceding calendar year and (2) such smaller number of shares as determined by the Company’s board of directors. As of June 30, 2025, 12,537,704 shares were reserved for issuance under the 2022 Plan, of which 9,638,548 shares remained available for future issuance.

2022 Employee Stock Purchase Plan

In April 2022, the Company’s board of directors and stockholders approved the 2022 Employee Stock Purchase Plan (the “2022 ESPP”). The 2022 ESPP became effective in connection with the Company’s IPO. The 2022 ESPP permits eligible employees who elect to participate in an offering under the ESPP to have up to a specified percentage of their eligible

earnings withheld, subject to certain limitations, to purchase shares of common stock pursuant to the 2022 ESPP. The price of common stock purchased under the 2022 ESPP is equal to 85% of the lower of the fair market value of the common stock on the first trading day of the offering period or the relevant purchase date. A total of 410,000 shares of the Company’s common stock was initially reserved for issuance under the 2022 ESPP. In addition, the number of shares available for issuance under the 2022 ESPP will be annually increased on January 1 of each calendar year ending in and including 2032, by an amount equal to the lesser of (1) 1% of the shares outstanding on the final day of the immediately preceding calendar year and (2) such smaller number of shares as is determined by the Company’s board of directors, provided that no more than 10,000,000 shares of the Company’s common stock may be issued under the 2022 ESPP.

A summary of the Company’s stock option activity under the Plans is as follows (in thousands, except share and per share data):

 

 

Number of
Outstanding
Options

 

 

Weighted
Average
Exercise
Price

 

 

Weighted
Average
Remaining
Contractual
Term
(in years)

 

 

Aggregate
Intrinsic
Value

 

Balance at December 31, 2024

 

 

3,357,491

 

 

$

14.11

 

 

 

5.50

 

 

$

 

Cancelled

 

 

(1,131,310

)

 

 

13.98

 

 

 

 

 

 

 

Balance at June 30, 2025

 

 

2,226,181

 

 

$

14.16

 

 

 

7.63

 

 

$

 

Vested and expected to vest at June 30, 2025

 

 

2,226,181

 

 

$

14.16

 

 

 

7.63

 

 

$

 

Exercisable at June 30, 2025

 

 

1,486,615

 

 

$

13.54

 

 

 

7.47

 

 

$

 

Stock-Based Compensation Expense

The fair value of common stock is based on the closing price as reported on the date of grant on the primary stock exchange on which the Company's common stock is traded. The assumptions used in the Black-Scholes option pricing model to determine the fair value of stock option grants were as follows:

 

 

Six Months Ended
June 30,

 

2025

 

 

2024

Risk-free interest rate

 

 

 

 

3.9%–4.7%

Expected volatility

 

 

 

 

95.1%–99.1%

Expected term (in years)

 

 

 

 

5.5-6.1

Expected dividend yield

 

 

 

 

0%

Risk-free interest rate. The risk-free interest rate is based on the U.S. Treasury yield in effect at the time of grant for zero coupon U.S. Treasury notes with maturities similar to the expected term of the awards.

Expected volatility. Given the Company's limited historical stock price volatility data, the expected volatility assumption is based on volatilities of a peer group of similar companies whose share prices are publicly available. The peer group was developed based on companies in the biotechnology industry. The Company will continue to apply this process until a sufficient amount of historical information regarding the volatility of its own stock price becomes available.

Expected term. The expected term represents the period of time that options are expected to be outstanding. Because the Company does not have historical exercise behavior, it determines the expected life assumption using the simplified method, for employees, which is an average of the contractual term of the option and its vesting period.

Expected dividend yield. The Company bases the expected dividend yield assumption on the fact that it has never paid cash dividends and has no present intention to pay cash dividends and, therefore, used an expected dividend yield of zero.

Stock-based compensation expense has been reported in the condensed consolidated statements of operations as follows (in thousands):

 

 

Three Months Ended
June 30,

 

 

Six Months Ended
June 30,

 

 

2025

 

 

2024

 

 

2025

 

 

2024

 

Research and development

 

$

277

 

 

$

3,188

 

 

$

556

 

 

$

5,896

 

General and administrative

 

 

2,053

 

 

 

2,873

 

 

 

4,203

 

 

 

5,359

 

Total

 

$

2,330

 

 

$

6,061

 

 

$

4,759

 

 

$

11,255

 

There were no option grants during the six months ended June 30, 2025. The weighted average grant date fair value per share of option grants for the six months ended June 30, 2024 was $11.70. As of June 30, 2025, total unrecognized stock-based compensation cost related to stock options was approximately $8.5 million, which is expected to be recognized over a remaining weighted-average period of approximately 1.9 years.

A summary of the Company’s unvested shares is as follows:

 

 

Number of
Unvested
Shares

 

 

Weighted Average Grant-Date Fair Value

 

Balance at December 31, 2024

 

 

918,227

 

 

$

13.791

 

Shares granted

 

 

137,592

 

 

 

1.880

 

Shares forfeited

 

 

(5,020

)

 

 

15.410

 

Shares vested

 

 

(406,093

)

 

 

10.866

 

Balance at June 30, 2025

 

 

644,706

 

 

 

12.791

 

The Company issued 137,592 restricted stock units to members of its Board of Directors during the six months ended June 30, 2025. The Company issued 1,036,450 shares of restricted common stock during the six months ended June 30, 2024, which consisted only of restricted stock units. The weighted average grant date fair value per share of restricted common stock grants for the six months ended June 30, 2024 was $15.02. As of June 30, 2025, total unrecognized stock-based compensation cost related to restricted stock was approximately $6.9 million, which is expected to be recognized over a remaining weighted-average period of approximately 1.6 years. For accounting purposes, unvested shares of restricted common stock are not considered outstanding until they vest. As of June 30, 2025 and December 31, 2024, the Company had no material repurchase liability related to the unvested shares in the table above.

Common Stock Reserved for Future Issuance

Common stock reserved for future issuance consists of the following:

 

June 30,
2025

 

Common stock options outstanding

 

 

2,226,181

 

Shares available for issuance under the Plans

 

 

9,638,548

 

Shares available for issuance under the ESPP

 

 

1,666,810

 

 

 

 

13,531,539