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SHARE-BASED COMPENSATION

6 Months Ended

Jun. 30, 2026

NOTE 15- SHARE-BASED COMPENSATION

On the Implementation Date, and pursuant to the Scheme, Cenntro Inc. assumed CEGL’s obligations with respect to the settlement of the options that were issued by CEGL prior to the Implementation Date pursuant to CEGL’s amended and restated 2016 incentive stock option plan and 2022 stock incentive plan (the “Share Option Plans”) by way adoption of a new incentive plan, the Company’s 2023 equity incentive plan (the “2023 Plan”).

Following the Implementation Date, no new options will be issued under the Share Option Plans. The Company has assumed CEGL’s obligations with respect to the settlement of incentive options that were previously issued by CEGL under the 2023 Plan.

Incentive Stock Option Limit: the maximum number of Common Stock that may be issued upon the exercise of incentive stock options (“ISOs”) under the 2023 Plan is 30,000,000 shares (equivalent to 500,000 shares after giving effect to the reverse stock split effective on April 13, 2026) of Common Stock.

For the six months ended June 30, 2026 and 2025, the total share-based compensation expenses were comprised of the following:

	For the Six Months Ended June 30,
	2026		2025
	(Unaudited)		(Unaudited)
General and administrative expenses	$	597,565	$	1,285,083
Selling and marketing expenses		15,552		31,103
Research and development expenses		52,144		143,402
Total	$	665,261	$	1,459,588

A summary of share options activity for the six months ended June 30, 2026 and 2025 were as follows:

	Number of Share Options*			Weighted Average Exercise Price $		Weighted Average Remaining Contractual Years		Aggregate Intrinsic Value $
Outstanding at December 31, 2024		28,884			828.2		3.65		-
Granted		-			-
Exercised		-			-
Forfeited		(265	)		1,008.0
Expired		(1,160	)		431.3
Outstanding at June 30, 2025 (Unaudited)		27,459			843.2		3.38		-

Outstanding at December 31, 2025		25,177			829.8		3.12		-
Granted		-			-
Exercised		-			-
Forfeited		(17	)		1,008.0
Expired		(498	)		1,008.0
Outstanding at June 30, 2026 (Unaudited)		24,662			826.0		2.80		-
Expected to vest at June 30, 2026 (Unaudited)		-			-				-
Exercisable as of June 30, 2026 (Unaudited)		24,662			805.6		2.80		-

* On April 13, 2026, the Company effected a 1-for-60 reverse stock split of its issued and outstanding common stock (the “Reverse Stock Split”). As a result of the Reverse Stock Split, every sixty (60) shares of the Company’s common stock were automatically combined into one (1) share of common stock, with any fractional shares rounded up to the nearest whole share.

All share and per share amounts presented in the accompanying unaudited condensed consolidated financial statements have been retrospectively adjusted to reflect the Reverse Stock Split for all periods presented, unless otherwise indicated.

The Company calculated the fair value of the share options on the grant date and modification date using the Black-Scholes option-pricing valuation model. The assumptions used in the valuation model are summarized in the following table.

	For the Six Months Ended June 30,
	2026 (Unaudited)			2025 (Unaudited)
Expected volatility	83.41%~86.57		%	83.41%~86.57		%
Expected dividends yield		0	%		0	%
Risk-free interest rate per annum	2.97%~3.01		%	2.97%~3.01		%
The fair value of underlying common stock (per share)	$	1008.0		$	1008.0

The expected volatility is calculated based on the annualized standard deviation of the daily return embedded in historical share prices of the Company. The risk-free interest rate is estimated based on the yield to maturity of US treasury bonds based on the expected term of the incentive shares.

As of June 30, 2026, there was no total unrecognized compensation cost from continuing operations related to unvested share options.