Atea Pharmaceuticals, Inc. Stock Compensation Disclosure

11. Stock-based Compensation

In October 2020, the Company’s shareholders approved the Company’s 2020 Incentive Award Plan (“2020 Plan”). The 2020 Plan initially provided for the issuance of up to 7,924,000 shares of common stock and for the grant of incentive stock options or other incentive awards to employees, officers, directors and consultants of the Company. The number of shares of common stock that may be issued under the 2020 Plan is also subject to increase on the first day of each calendar year equal to the lesser of i) 5% of the aggregate number of shares of common stock outstanding on the final day of the immediately preceding calendar year or ii) such smaller number of shares as is determined by the board of directors. Through December 31, 2024, the shares available under the plan were increased by 16,622,139 shares. As of December 31, 2024, 5,362,362 shares of common stock were available for

future issuance under the 2020 Plan. In January 2025, the shares of the Company's common stock available under the 2020 Plan were increased by 4,223,152 shares.

The 2020 Plan replaced and is the successor of the Company’s 2013 Equity Incentive Plan, as amended (“2013 Plan”). In the event of any cancellation of an outstanding option award under the 2013 Plan, the shares underlying the cancelled option award will be made available for grant under the 2020 Plan.

Stock Options

During the years ended December 31, 2024 and 2023, the Company granted 3,213,550 and 3,777,550 stock options with an aggregate grant date fair value of $9,622 and $12,365, respectively.

The aggregate intrinsic value of options granted is calculated as the difference between the exercise price of the options and the estimated fair value of the Company’s common stock for those options that had exercise prices lower than the fair value of the Company’s common stock.

Option grants generally vest over a service period of three or four years and have a contractual term of ten years. As of December 31, 2024, total unrecognized compensation expense related to stock option awards was $21,396, which amount is being recognized over a remaining weighted average period of 2.2 years.

The weighted average grant date fair value per option granted during the years ended December 31, 2024 and 2023 was $2.99 and $3.27, respectively. The fair value of each award was estimated using Black-Scholes based on the following weighted average assumptions:

Restricted Stock Units

During the year ended December 31, 2024 and 2023, the Company granted 1,126,100 and 2,264,700 restricted stock units to employees and the board of directors with an aggregate grant date fair market value of $4,557 and $10,384, respectively. The restricted stock unit awards vest in three annual installments. During the years ended December 31, 2024 and 2023, the Company issued 927,932 and 53,935 shares of common stock upon the vesting and settlement of restricted stock units. During the year ended December 31, 2024 and 2023, 12,633 and 34,998 restricted stock units were cancelled due to employee terminations.

As of December 31, 2024, total unrecognized compensation expense related to restricted stock unit awards was $6,445, which amount is being recognized over a remaining weighted average period of 1.4 years.

Performance-based Restricted Stock Units

As of December 31, 2023 the Company had 724,970 performance-based restricted stock units (“2022 PSUs”) outstanding. The 2022 PSUs provide for a performance period from February 1, 2022 through January 31, 2025 to achieve up to six defined performance metrics. The percentage of 2022 PSUs eligible to vest will be determined based on the number of metrics achieved during the performance period and may range from 0% to 200%. The Company did not recognize any compensation expense related to these awards during the year ended December 31, 2023, as achievement of the minimum performance criteria had not been deemed probable. During the year ended December 31, 2024 achievement of two metrics was deemed probable resulting in expense recognition of 50% of the grant date value of the 2022 PSUs. Compensation expense is being recognized from the grant date through the final vest date of January 31, 2026. The vesting of 2022 PSUs for which the performance metrics are determined to have been met will occur in equal installments on January 31, 2025 and January 31, 2026, provided the recipient remains in service to the Company at that time. The Company recorded compensation expense of $2,201 for the year ended December 31, 2024.

During the year ended December 31, 2024, the Company granted 1,057,900 performance-based restricted stock units (“2024 PSUs”) to employees with an aggregate grant date fair value of $4,401. The 2024 PSUs provide for a performance period from February 1, 2024 through January 31, 2027 to achieve up to four defined performance metrics. The percentage of 2024 PSUs eligible to vest will be determined based on the number of metrics achieved during the performance period and may range from 0% to 200%. As of December 31, 2024 two metrics were deemed probable of achievement resulting in expense recognition of 75% of the grant date value of the 2024 PSUs. Compensation expense is being recognized from the grant date through the final vest date of January 31, 2027. The Company recorded compensation expense of $1,009 for the year ended December 31, 2024.

During the years ended December 31, 2024 and 2023, there were no cancellations of performance-based restricted stock units.

As of December 31, 2024, total unrecognized compensation expense related to performance-based restricted stock units was $2,679, which amount is being recognized over a remaining weighted average period of 1.5 years.

Employee Stock Purchase Plan

In October 2020, the Company’s shareholders approved the ESPP, which became effective upon the closing of the Company’s IPO in November 2020. The Company initially reserved a total of 1,187,000 shares of its common stock for issuance under the ESPP. The ESPP provides that the number of shares reserved and available for issuance under the ESPP will be increased on January 1 of each calendar year by 1% of the number of shares of the Company's common stock issued and outstanding on the immediately preceding December 31 or such lesser amount as specified by the board of directors. Through December 31, 2024, the number of shares of the Company's common stock available for issuance under the ESPP was increased by 1,667,231. In January 2025 the number of shares of the Company's common stock available for issuance under the ESPP was increased by 844,630.

The Company issued 99,614 and 93,939 shares for proceeds of $267 and $257 during the years ended December 31, 2024 and 2023, respectively.

Stock-based Compensation Expense