11. Stock-Based Compensation

Equity Plans

2023 Equity Incentive Plan

In September 2023, the Company adopted the 2023 Equity Incentive Plan (“2023 Plan”). The 2023 Plan provides for the grant of stock options, restricted stock awards, restricted stock unit awards, and other stock-based awards to employees, directors, and non-employee service providers of the Company. The 2023 Plan replaced the Company’s 2020 Equity Incentive Plan (“2020 Plan”). The Company no longer grants stock options or other awards under its 2020 Plan, but any stock options outstanding under the 2020 Plan remain outstanding and effective in accordance with their terms. Awards granted under the 2023 Plan expire no later than ten years from the date of grant. The price of stock options shall not be less than 100% of the estimated fair value on the date of grant and typically vest over a four-year period although may be granted with different vesting terms.

The 2023 Plan provides for an annual increase, to be added on the first day of each fiscal year, by up to 5% of the Company’s outstanding shares of common stock as of the last day of the prior year. On January 1, 2025, the number of shares of common stock available for issuance under the 2023 Plan increased by 8,085,495 shares as a result of the automatic increase provision of the 2023 Plan.

2023 Employee Share Purchase Plan

In September 2023, the Company adopted the 2023 Employee Share Purchase Plan (the ESPP). The Company may hold one or more offering periods each year during which employees will be able to purchase shares under the 2023 ESPP through payroll deductions made over the term of the offering. The per-share purchase price at the end of each offering period is equal to the lesser of 85% of the closing price of the Company's common stock at the beginning or end of the offering period. On January 1, 2025, the number of shares of common stock available for issuance under the 2023 ESPP increased by 1,617,099 shares as a result of the automatic increase provision of the ESPP. The Company issued 434,193 shares during the year ended December 31, 2025.

The stock option activity table above excludes options granted to purchase 446,068 shares of common stock that were originally granted with market conditions to one of the Company’s executives.

The weighted-average fair value of stock options granted was $1.22, and $12.48 per share for the years ended December 31, 2025 and 2024, respectively. The intrinsic value of stock options exercised was $0 and $16.7 million for the years ended December 31, 2025 and 2024, respectively. The aggregate grant-date fair value of options vested was $28.1 million and $24.6 million for the years ended December 31, 2025 and 2024, respectively.

Option Repricing

On February 13, 2025 (the “Effective Date”), the Company’s Board of Directors approved an option repricing (the “Repricing”) of the outstanding stock options held by members of the Board, certain employees and other service providers, including the Company’s named executive officers, subject to shareholder approval, which was obtained at the Annual Meeting of Stockholders on May 28, 2025 (“Modification Date”). Under the Repricing, the exercise price of each outstanding stock option under the Company’s 2023 Plan and 2020 Plan with an exercise price per share greater than $0.72 (the closing trading price of a share of the Company’s common stock on the Nasdaq Stock Market on May 28, 2025) held by those individuals eligible for the Repricing was repriced to $0.72 per share.

Under the terms of the Repricing, a repriced option will revert to its original exercise price if certain events occur prior to the 18 month anniversary of the effective date

The Repricing resulted in $4.2 million of incremental stock compensation expense, which was calculated using the Black-Scholes option-pricing model. $2.4 million of the incremental compensation cost related to unvested stock options as of the Modification Date, will be recognized on a straight line basis over the remaining requisite service period of the respective option, and $1.8 million of incremental compensation cost related to vested stock options will be recognized on a straight line basis over the remaining vesting period of the repriced options.

Of the incremental compensation cost, $1.5 million was recognized during the year ended December 31, 2025.

Fair Value of Stock Options

Expected volatility—As there is limited trading history for the Company’s common stock, the Company has determined expected volatility based on the average historical stock price volatility of comparable publicly-traded companies and expects to continue to do so until such time as it has adequate historical data regarding the volatility of its own traded stock price. The comparable companies are chosen based on their similar size, stage in the life cycle or area of therapeutic focus. The historical volatility is calculated based on a period of time commensurate with the expected term assumption.

Expected term—The expected term of the Company’s stock options has been estimated using the simplified method for awards that qualify as plain-vanilla stock options. The simplified method calculates the expected term as the average of the time-to-vesting and the contractual life of the stock options.

Risk-free interest rate—The risk-free interest rate assumption was based on the U.S. Treasury yield curve in effect at the time of grant of the award for time periods approximately equal to the expected term of the award.

Expected dividend yield—The expected dividend yield assumption is zero as the Company has never paid and has no plans to pay dividends on its common stock in the foreseeable future.

Early Exercise of Employee Stock Options

The Company’s Plans allow for certain employees to exercise their stock options prior to vesting into shares of restricted common stock. The proceeds from early exercised stock options are recorded as liabilities in the consolidated balance sheets at the time of exercise and reclassified to common stock and additional paid-in capital as the underlying stock options vest and the Company’s repurchase right lapses. As of December 31, 2025, the Company had issued 1,004,607 shares of restricted common stock upon the early exercise of unvested stock options, of which 876,839 shares had vested and 122,987 unvested shares had been repurchased, such that 4,781 shares or restricted stock remained outstanding and unvested.

Restricted Stock Activity

The Company’s Plans allow for the grant of restricted common stock and restricted stock units to certain employees, executives, non-employee scientific advisors, and third-party service providers. The restrictions lapse over time primarily according to service-based

vesting conditions of each award. In the event of a voluntary or involuntary termination of the holder’s continuous provision of services to the Company, any unvested portion of the restricted stock award is automatically forfeited.

Stock-Based Compensation

As of December 31, 2025, there was $35.0 million and $9.5 million of unrecognized stock-based compensation related to stock options and restricted stock outstanding, respectively, which were expected to be recognized over a weighted-average remaining service period of 2.0 years and 2.1 years, respectively.