11. STOCK-BASED COMPENSATION

2018 Equity Incentive Plan

The Company’s 2018 Stock Incentive Plan (the “2018 Plan”) provided for the Company to grant qualified incentive options, nonqualified options, stock grants and other stock-based awards to employees and non-employees to purchase the Company’s common stock. Upon the effectiveness of the 2021 Plan (as defined below), the Company ceased issuing new awards under the 2018 Plan.

2021 Equity Incentive Plan

The 2021 Equity Incentive Plan (the “2021 Plan”) became effective in February 2021. The 2021 Plan provided for the grant of incentive stock options to employees, including employees of any parent or subsidiary corporations, and for the grant of nonstatutory stock options, stock appreciation rights, restricted stock awards, restricted stock unit awards, performance awards and other forms of stock awards to employees, directors, and consultants, including employees and consultants of the Company’s affiliates. Upon the effectiveness of the 2026 Plan (as defined below) on June 10, 2026, the Company ceased issuing new awards under the 2021 Plan.

2026 Equity Incentive Plan

The 2026 Equity Incentive Plan (the “2026 Plan”) became effective on June 10, 2026 upon approval by the Company's stockholders. The 2026 Plan provides for the grant of incentive stock options to employees, including employees of any parent or subsidiary corporations, and for the grant of nonstatutory stock options, stock appreciation rights, restricted stock awards, restricted stock unit awards, performance awards and other forms of stock awards to employees, directors, and consultants, including employees and consultants of the Company's affiliates. The number of shares initially reserved for issuance under the 2026 Plan was 2,671,981 shares, which will automatically increase on January 1 of each calendar year, starting on January 1, 2027 through January 1, 2036, in an amount equal to 5.0% of the total number of shares of the Company's capital stock outstanding on December 31 of the preceding calendar year, or a lesser number of shares determined by the Board of Directors. As of June 30, 2026, 2,376,981 shares remained available for issuance pursuant to the 2026 Plan.

Accelerated Options From The Acquisition

On February 17, 2026, in connection with the Acquisition, stock options to purchase 6,338,670 shares of Faeth common stock, held by certain Faeth employees, were immediately exercised by the Faeth employees, of which 4,273,182 options had their vesting accelerated (the “Accelerated Options”). The modification of the terms that resulted in the immediate vesting of the Accelerated Options was executed in contemplation of the Acquisition and did not require continued employment or future service by the option holders. The Company recognized $4.8 million of research and development expenses and $6.2 million of general and administrative expenses upon the Acquisition representing the fair value of the Accelerated Options on the date of the modification.

Assumed Options From The Acquisition

On February 17, 2026, in connection with the Acquisition, the Company assumed all outstanding and unexercised stock options to purchase an aggregate of 252,210 shares of common stock. The Assumed Options were converted into options to purchase shares of the Company's common stock using an exchange ratio of approximately 0.1993, with exercise prices ranging from $1.16 to $5.22 per share on an as-converted basis. The Company recognized $0.5 million representing the fair value of the Assumed Options attributable to the pre-combination service period as part of the consideration transferred. The remaining unrecognized compensation expense associated with the unvested Assumed Options will be recognized over their remaining service periods, which range from approximately 0.1 to 3.5 years. See Note 3 for additional information regarding the Acquisition.

Inducement Grants

In connection with the Acquisition, the Company granted inducement nonstatutory stock options to purchase an aggregate of 2,319,891 shares of common stock to former Faeth employees on February 19, 2026, at an exercise price of $27.22 per share, as a material inducement to entering employment with the Company. In addition, on March 11, 2026, the Company granted an inducement nonstatutory stock option to purchase 166,435 shares of common stock at an exercise price of $29.37 per share to a new employee as a material inducement to entering employment with the Company. These stock options will vest over a four-year period, with 25% of the shares underlying each option award vesting on the one-year anniversary of the applicable employees’ new hire date and the remaining 75% of the shares underlying each option award vesting monthly thereafter for three-years. Vesting of each option award is subject to such employee’s continued service with the Company through the applicable vesting dates. These stock options were granted outside of the 2021 Plan as an inducement material to each employee’s acceptance of employment with the Company in accordance with Nasdaq Listing Rule 5635(c)(4).

2026 Inducement Plan

On April 10, 2026, the Board of Directors adopted the 2026 Inducement Plan, which provides for the grant of nonstatutory stock options, stock appreciation rights, restricted stock awards, restricted stock unit awards, performance awards and other forms of stock awards to new employees as a material inducement to entering employment with the Company. A total of 450,000 shares of common stock are reserved for issuance under the 2026 Inducement Plan. The 2026 Inducement Plan was adopted without stockholder approval in accordance with Nasdaq Listing Rule 5635(c)(4). During the six months ended June 30, 2026, the Company granted

nonstatutory stock options to purchase an aggregate of 199,650 shares of common stock under the 2026 Inducement Plan. As of June 30, 2026, 250,350 shares remained available for issuance pursuant to the 2026 Inducement Plan.

2021 Employee Stock Purchase Plan

The 2021 Employee Stock Purchase Plan (the “2021 ESPP”) became effective in February 2021. A total of 16,666 shares (333,333 prior to the 1-for-20 reverse stock split of the Company’s issued and outstanding shares of common stock effected on June 16, 2025) of common stock were initially reserved for issuance under the 2021 ESPP. As of June 30, 2026, the Company had issued 12,220 shares under the 2021 ESPP, no shares were issued in six months ended June 30, 2026. Upon the effectiveness of the 2026 ESPP (as defined below) on June 10, 2026, the Company ceased issuing new awards under the 2021 ESPP.

2026 Employee Stock Purchase Plan

The 2026 Employee Stock Purchase Plan (the “2026 ESPP”) became effective on June 10, 2026 upon approval by the Company's stockholders. A total of 267,198 shares of common stock were initially reserved for issuance under the 2026 ESPP, which will automatically increase on January 1 of each calendar year, beginning on January 1, 2027 through January 1, 2036, by an amount equal to the lesser of (i) 1.0% of the total shares of common stock outstanding on December 31 of the preceding calendar year and (ii) 534,396 shares, or a lesser number of shares determined by the Board of Directors. The purchase price of the shares under the 2026 ESPP is 85% of the lower of the fair market value of the Company's common stock on the first trading day of the offering period or on the purchase date. As of June 30, 2026, no shares had been issued under the 2026 ESPP.

Stock Options

The Company granted options to purchase shares of common stock at a weighted average grant date fair value of $21.04 per share during the six months ended June 30, 2026, including grants under the 2021 Plan, the 2026 Plan, the 2026 Inducement Plan, and inducement grants outside any plan. The Company uses the Black-Scholes option-pricing model to estimate the fair value of the stock options on the applicable grant dates.

The aggregate intrinsic value of the outstanding stock option awards is calculated as the difference between the exercise price and the market price of the Company’s common stock at June 30, 2026. The aggregate intrinsic value of stock options exercised in the six months ended June 30, 2026 was $2.2 million and there were no option exercises for the six months ended June 30, 2025.

The grant date fair value of options vested during the six months ended June 30, 2026 and 2025 was $1.1 million and $0.7 million, respectively.

At June 30, 2026, there was $62.2 million of unrecognized stock-based compensation expense associated with the stock options, which is expected to be recognized over a weighted-average period of 3.58 years.

Restricted Stock Units

The Company has granted restricted stock units with service-based vesting conditions.

Pursuant to the 2021 Plan, the Company has historically granted restricted stock units which vest annually over a period of one, two, three or four years. The Company granted no restricted stock units during the six months ended June 30, 2026.

As of June 30, 2026, unrecognized stock-based compensation expense associated with the restricted stock units was immaterial and is expected to be recognized over a weighted-average period of 0.63 years.

Common Stock Warrants

As of June 30, 2026 there was no unrecognized stock-based compensation expense associated with the common stock warrants.

For the six months ended June 30, 2026 and 2025, respectively, the Company utilized the Black-Scholes option-pricing model for estimating the fair value of the stock options and common stock warrants granted. The following table presents the assumptions and the Company’s methodology for developing each of the assumptions used: