The 2020 Equity Incentive Plan (the “2020 Plan”) was approved by the Company’s stockholders on February 11, 2020. The 2020 Plan provides for the grant of incentive stock options, within the meaning of Section 422 of the Internal Revenue Code of 1986, as amended (the “Code”), to employees, and for the grant of nonstatutory stock options, stock appreciation rights, restricted stock, restricted stock units (“RSUs”), performance units, and performance shares to employees, directors and consultants.

Subject to the adjustment provisions of the 2020 Plan and the automatic annual increase described below, the maximum aggregate number of shares of common stock that may be issued under the 2020 Plan is 5,050,000

shares, which includes (i) 2,588,077 shares initially reserved for issuance, plus (ii) any shares of the Company’s common stock subject to issued and outstanding awards under the Transphorm Technology 2007 Stock Plan or the Transphorm Technology 2015 Equity Incentive Plan that, on or after February 12, 2020, expire or otherwise terminate without having been exercised or issued in full, are tendered to or withheld by the Company for payment of an exercise price or for tax withholding obligations, or are forfeited to or repurchased by the Company due to failure to vest, with the maximum number of shares to be added to the 2020 Plan pursuant to this clause (ii) equal to 2,461,923 shares.

Subject to the adjustment provisions of the 2020 Plan, the number of shares of common stock available for issuance under the 2020 Plan will also include an annual increase on the first day of each fiscal year beginning with the Company’s 2022 fiscal year and ending on (and including) the Company’s 2030 fiscal year, in an amount equal to the least of: (i) 5,000,000 shares of common stock; (ii) five percent (5%) of the outstanding shares of the Company’s common stock on the last day of the immediately preceding fiscal year; or (iii) such number of shares of common stock as the administrator of the 2020 Plan may determine. On April 1, 2022, 2,668,965 shares were added to the 2020 Plan pursuant to such automatic annual increase provision.


	Number of Options	Weighted Average Exercise Price per Share		Weighted Average Remaining Contractual Term (in Years)	Aggregate Intrinsic Value (1) (in thousands)
Outstanding at October 1, 2022	3,045,662	$	4.89	5.80	$	1,783
Options granted	87,803	4.77
Options exercised	(154,904)	4.22
Options canceled	(49,076)	5.25
Outstanding at December 31, 2022	2,929,485	4.92		5.76	2,608
Exercisable at December 31, 2022	2,221,319	4.62		4.70	2,342

Outstanding at October 1, 2021	2,506,531	$	4.77	5.67	$	590
Options granted	473,077	6.52
Options exercised	—	—
Options canceled	(21,704)	9.32
Outstanding at December 31, 2021	2,957,904	5.02		6.14	9,218
Exercisable at December 31, 2021	2,227,540	4.61		5.00	7,958

(1) Intrinsic value represents the excess of the fair value on the last day of the period (which was $5.44 and $8.00 as of December 31, 2022 and 2021, respectively) over the exercise price, multiplied by the number of options.


	Number of Options	Weighted Average Exercise Price per Share		Weighted Average Remaining Contractual Term (in Years)	Aggregate Intrinsic Value (1) (in thousands)
Outstanding at April 1, 2022	2,879,008	$	4.88	6.02	$	6,747
Options granted	281,712	5.09
Options exercised	(168,326)	4.22
Options canceled	(62,909)	5.75
Outstanding at December 31, 2022	2,929,485	4.92		5.76	2,608
Exercisable at December 31, 2022	2,221,319	4.62		4.70	2,342

Outstanding at April 1, 2021	2,543,125	$	4.82	6.05	$	—
Options granted	528,077	6.31
Options exercised	(31,925)	4.21
Options canceled	(81,373)	7.46
Outstanding at December 31, 2021	2,957,904	5.02		6.14	9,218
Exercisable at December 31, 2021	2,227,540	4.61		5.00	7,958

Stock-based compensation expense is determined based on the fair value of the Company’s common stock as determined by the Board of Directors and assumptions such as volatility, expected term, risk-free interest rates, and other factors. Changes in the deemed fair value of the common stock, the underlying assumptions in the calculations, the number of options granted or the terms of such options, the expected forfeiture rate, the treatment of tax benefits and other changes may result in significant differences in the amounts or timing of the compensation expense recognized.


	Three Months Ended December 31,		Nine Months Ended December 31,
	2022	2021	2022	2021
Weighted average expected life (in years)	5.66	5.58	5.68	5.88
Risk-free interest rate	3.73% - 3.75%	1.32%	3.12% - 3.75%	1.30%
Expected volatility	45.91% - 47.20%	42.65%	42.49% - 47.20%	42.77%
Grant date fair market value	$4.77	$6.55	$4.77 - $5.24	$6.34
Grant date fair value	$2.21- $2.30	$3.11	$2.21 - $3.01	$2.99
Dividend yield	—%	—%	—%	—%

During the three months ended December 31, 2022, the Company recognized $0.3 million in incremental compensation cost as a result of an amendment to a former employee’s option agreements to allow for an extended post termination exercise period.

During the three months ended September 30, 2021, the Company granted 35,000 RSUs, 25 percent of which are scheduled to vest after one year and the remainder of which are scheduled to vest in equal quarterly installments over the next three years, in each case subject to the RSU holders’ continued status as a service provider to the Company through each vesting date. During the three months ended September 30, 2022, the Company granted 164,440 RSUs that are scheduled to vest within four years, in each case subject to the RSU holders’ continued status as a service provider to the Company through each vesting date. During the three months ended December 31, 2022, the Company granted 75,250 RSUs that are scheduled to vest annually over three years, in each case subject to the RSU holders’ continued status as a service provider to the Company through each vesting date.


	December 31, 2022
	Three Months Ended			Nine Months Ended
	Number of Shares	Weighted-Average Grant Date Fair Value Per Share		Number of Shares	Weighted-Average Grant Date Fair Value Per Share
Balance at beginning of period	1,027,754	$	4.96	954,775	$	4.61
Granted	75,250	4.77		239,690	5.09
Vested	(80,551)	7.17		(115,731)	6.31
Canceled	(3,975)	4.04		(60,256)	3.98
Balance at end of period	1,018,478	4.77		1,018,478	4.77


	December 31, 2021
	Three Months Ended			Nine Months Ended
	Number of Shares	Weighted-Average Grant Date Fair Value Per Share		Number of Shares	Weighted-Average Grant Date Fair Value Per Share
Balance at beginning of period	951,637	$	3.96	935,397	$	3.96
Granted	307,640	6.60		342,640	6.31
Vested	(9,750)	3.75		(12,750)	3.75
Canceled	(1,520)	3.85		(17,280)	3.97
Balance at end of period	1,248,007	4.61		1,248,007	4.61

On December 16, 2022 the Board approved $0.5 million worth of RSU grants for which shares were to be determined on January 1, 2023 and which shall vest on January 1, 2024. On January 1, 2023, the total number of RSU awards under this grant was determined to be 93,895.


	Three Months Ended December 31,				Nine Months Ended December 31,
	2022		2021		2022		2021
Cost of revenue	$	88	$	52	$	180	$	118
Research and development	410		145		365		383
Sales and marketing	62		88		171		159
General and administrative	563		563		1,626		1,196
Total	$	1,123	$	848	$	2,342	$	1,856


	December 31, 2022			December 31, 2021
	Unrecognized Expense		Average Expected Recognition Period (in years)	Unrecognized Expense		Average Expected Recognition Period (in years)
Stock options	$	1,553	1.17	$	1,531	2.23
Restricted stock	1,979		1.59	3,117		1.74
Total	$	3,532	1.41	$	4,648	1.90