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SHARE-BASED PAYMENT
 9 Months Ended
Sep. 30, 2025
Share-Based Payment Arrangement [Abstract]  
SHARE-BASED PAYMENT SHARE-BASED PAYMENT
On July 21, 2021, the Company adopted the Microvast Holdings, Inc. 2021 Equity Incentive Plan (the “2021 Plan”), effective upon the Closing Date. The 2021 Plan provides for the grant of incentive and non-qualified stock options, restricted stock units, restricted share awards, stock appreciation awards, and cash-based awards to employees, directors, and consultants of the Company. Options awarded under the 2021 Plan expire no more than 10 years from the date of grant. Concurrently with the closing of the Business Combination, the share awards granted under 2012 Share Incentive Plan of Microvast, Inc. (the “2012 Plan”) were rolled over by removing original performance conditions and converting into options and capped non-vested share units with modified vesting schedules, using the Common Exchange Ratio of 160.3. The 2021 Plan reserved 5% of the fully-diluted shares of Common Stock outstanding immediately following the Closing Date plus the shares underlying the awards rolled over from the 2012 Plan for issuance in accordance with the 2021 Plan’s terms.

Stock options
The grant date fair value of the stock options was determined using the Black-Scholes-Merton model with the following assumptions:
Nine months ended September 30, 2025
Exercise price$3.57 
Expected terms (years)5.94
Volatility109.06 %
Risk-free interest rate4.04 %
Expected dividend yields0.00 %
Weighted average fair value of options granted$2.99 
The exercise prices for each award were extracted from the option agreements. The expected terms for each award were derived using the simplified method, and is estimated to occur at the midpoint of the vesting date and the expiration date. The volatility of the underlying common stock during the lives of the options was a blend of implied volatility from the average volatility of peer companies, implied volatility and the Company's historical volatility. Risk-free interest rate was estimated based on the market yield of U.S. Government Bonds with maturity close to the expected term of the options.
Stock options - continued
The dividend yield was estimated by the Company based on its expected dividend policy over the expected term of the options.
Stock options activity for the nine months ended September 30, 2025 and 2024 was as follows:
Stock options lifeNumber of Shares Weighted Average Exercise Price
(US$)		Weighted Average Grant Date
Fair Value (US$)		Weighted Average Remaining
Contractual Life
Outstanding as of December 31, 202432,701,399 5.80 4.58 4.5
Granted300,000 3.57 2.99 
Exercised(33,334)2.08 1.48 
Forfeited(6,514,093)6.02 4.52 
Outstanding as of September 30, 202526,453,972 5.72 4.58 4.3
Expected to vest and exercisable as of September 30, 202526,453,972 5.72 4.58 4.3
Exercisable as of September 30, 202524,320,639 6.11 4.91 4.1
Outstanding as of December 31, 202332,876,682 6.01 4.73 5.7
Forfeited(1,521,350)4.60 3.18 
Outstanding as of September 30, 202431,355,332 6.08 4.80 5.0
Expected to vest and exercisable as of September 30, 202431,355,332 6.08 4.80 5.0
Exercisable as of September 30, 202430,088,665 6.14 4.89 5.1
During the three months ended September 30, 2025 and 2024, the Company recorded share-based compensation expense of $(143) and $3,176 related to the option awards, respectively. During the nine months ended September 30, 2025 and 2024, the Company recorded share-based compensation expense of $267 and $25,489 related to the option awards, respectively.
The total unrecognized equity-based compensation costs as of September 30, 2025 related to the stock options was $1,419, which is expected to be recognized over a weighted-average period of 1.9 years. The aggregate intrinsic value of the stock options as of September 30, 2025 was $5,906.
Restricted stock units
Following the Business Combination, the Company granted 5,770,564 restricted stock units (“RSUs”) and 3,290,953 performance-based restricted stock units (“PSUs”) subject to service, performance and/or market conditions. The service condition requires the participant’s continued services or employment with the Company through the applicable vesting date, and the performance condition requires the achievement of the performance criteria defined in the award agreement. The market condition is based on the Company’s total stockholder return (“TSR”) relative to a comparator group during a specified performance period.
Restricted stock units - continued
The fair value of RSUs is determined by the market closing price of Common Stock at the grant date and is amortized over the vesting period on a straight-line basis. The fair value of PSUs that include vesting based on market conditions are estimated using the Monte Carlo valuation method. For PSUs with performance conditions, share-based compensation expense is only recognized if the performance conditions become probable to be satisfied. Compensation cost for these awards is amortized on a straight-line basis over the vesting period based on the grant date fair value, regardless of whether the market condition is satisfied. Accordingly, the Company recorded share-based compensation expense of $641 and $1,509 related to RSUs and $256 and $527 related to PSUs during the three and nine months ended September 30, 2025. During the three and nine months ended September 30, 2024, the Company recorded share-based compensation expense of $358 and $1,058 related to these RSUs and $2,463 and $971 related to PSUs.
The non-vested RSUs activity for the nine months ended September 30, 2025 and 2024 was as follows:
Number of
Non-Vested
Shares 		Weighted
Average Grant
Date Fair Value
Per Share (U.S.$)
Outstanding as of December 31, 20243,423,305 1.63 
Granted1,222,694 2.79 
Vested(587,553)2.48 
Forfeited(155,328)2.34 
Outstanding as of September 30, 20253,903,118 1.84 
Outstanding as of December 31, 20233,598,606 3.07 
Granted79,909 1.40 
Vested(503,505)2.65 
Forfeited(777,206)4.29 
Outstanding as of September 30, 20242,397,804 2.71 
The total unrecognized equity-based compensation costs as of September 30, 2025 related to the non-vested shares was $4,319.
The following summarizes the classification of share-based compensation:
Three Months Ended September 30,Nine Months Ended September 30,
2025202420252024
Cost of revenues$60 $771 $184 $3,390 
General and administrative expenses472 3,392 1,475 19,192 
Research and development expenses149 1,604 455 5,902 
Selling and marketing expenses47 534 163 1,805 
Construction in process26 8 26 22 
Total$754 $6,309 $2,303 $30,311