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Share-Based Payments
6 Months Ended
Jun. 30, 2020
Share-based Payment Arrangement [Abstract]  
Share-Based Payments
7. Share-Based Payments
In 2016, the Company adopted the Relay Therapeutics, Inc. Stock Option and Grant Plan (the “Plan”). All of the Company’s employees, officers, directors, consultants and advisors are eligible to be granted options, restricted stock units, or RSUs, and other stock-based awards under the terms of the Plan. There were 777,099 and 3,100,839 share-based awards available for grant at June 30, 2020 and December 31, 2019, respectively.
 
The following table summarizes the stock option activity under the Plan for the six months ended June 30, 2020:
 
   
Number of
Stock
Options
   
Weighted-
Average
Exercise
Price
   
Weighted-
Average
Remaining
Term (years)
   
Aggregate
Intrinsic
Value
 
Outstanding at December 31, 2019
   5,306,176   $4.62    8.99   $3,214 
Granted
   2,500,266    5.89       20,369 
Exercised
   (181,414   3.95       
Cancelled
   (153,941   4.93       
  
 
 
          
Outstanding at June 30, 2020
   7,471,087   $5.05    8.93   $67,263 
  
 
 
          
Vested at June 30, 2020
   1,428,137   $4.35    8.25   $13,865 
  
 
 
          
In the first quarter of 2020, the Company’s board of directors approved the issuance of options with performance-based vesting conditions to purchase 1,960,547 shares of common stock. The commencement of vesting is based on the achievement of certain scientific and operational milestones during a
two-year
period, for which the achievement is discretionary and subject to the approval of the Company’s board of directors. Accordingly, the Company is applying variable accounting for these awards until the board of directors approves the commencement of vesting of the options. The service inception date precedes the grant date for these awards as the awards have been authorized, the recipients are providing service prior to the grant date, and there are performance conditions that, if not met by the accounting grant date, would result in the forfeiture of the award. Therefore, the stock-based compensation expense to be recognized for the options is based on the fair value of the awards on the accounting grant date. The Company’s board of directors, in its discretion, determined that a portion of the performance conditions had been achieved during the second quarter of 2020. The Company has made a probability assessment of the likelihood for achievement of the remaining conditions as of June 30, 2020. The Company recognized stock-based compensation expense associated with the options for which the board of directors approved the commencement of vesting in the second quarter of 2020 and for awards where achievement of the performance conditions is considered probable in the amount of $2,623 in the statement of operations for the three and six month periods ended June 30, 2020.
Stock-based compensation expense included in the Company’s consolidated statements of operations and comprehensive loss is as follows:
 
   
Three Months Ended

June 30,
   
Six Months Ended
June 30,
 
   
2020
   
2019
   
2020
   
2019
 
Research and development expenses
  $1,941   $647   $2,838   $1,201 
General and administrative expenses
   2,091    439    2,649    701 
  
 
 
   
 
 
   
 
 
   
 
 
 
  $4,032   $1,086   $5,487   $1,902 
  
 
 
   
 
 
   
 
 
   
 
 
 
As of June 30, 2020, total unrecognized compensation cost related to the unvested stock-based awards was $31,407, which is expected to be recognized over a weighted average period of 3.2 years.