Legacy SmartRent’s board of directors adopted, and its stockholders approved, the SmartRent.com, Inc. 2018 Stock Plan (the “2018 Stock Plan”), effective March 2018. The purpose of the 2018 Stock Plan was to advance the interests of Legacy SmartRent and its stockholders by providing an incentive to attract, retain and reward persons performing services for Legacy SmartRent and by motivating such persons to contribute to the growth and profitability of Legacy SmartRent. The 2018 Stock Plan sought to achieve this purpose by providing awards in the form of stock options and restricted stock purchase rights. Awards granted as stock options under the 2018 Stock Plan generally expire no later than ten years from the date of grant and become vested and exercisable over a four-year period. All options are subject to certain provisions that may impact these vesting schedules.

In April 2021, the board of directors of Legacy SmartRent executed a unanimous written consent to provide an additional incentive to certain employees of Legacy SmartRent by amending the 2018 Stock Plan to allow for the issuance of RSUs and granted a total of 1,533 RSUs to certain employees which vest over four years. The estimated fair value for each RSU issued was approximately $21.55 per share and the total stock-based compensation expense to be amortized over the vesting period is $33,033. Effective upon the Business Combination in August 2021, the 2018 Stock Plan was replaced by the 2021 Plan. The 2018 Stock Plan continues to govern the terms and conditions of the outstanding awards previously granted thereunder. No new awards will be granted out of the 2018 Stock Plan.

In connection with the Business Combination, the Board approved and implemented the SmartRent, Inc. 2021 Plan (the "2021 Plan"). The purpose of the 2021 Plan is to enhance the Company's ability to attract, retain and motivate persons who make, or are expected to make, important contributions to the Company by providing these individuals with equity ownership opportunities and equity-linked compensation opportunities.

The 2021 Plan authorizes the administrator of the 2021 Plan (generally, the Board or its compensation committee) to provide incentive compensation in the form of stock options, restricted stock and stock units, performance shares and units, other stock-based awards and cash-based awards. Under the 2021 Plan, the Company is authorized to issue up to 15,500 shares of Class A common stock. On May 14, 2024, the Company's stockholders approved the 2021 Plan, as amended and restated, which increased the number of shares reserved for issuance thereunder by 8,900 shares of Class A common stock. The Company is authorized to issue up to a total of 24,400 shares of Class A common stock under the 2021 Plan, as amended and restated. Non-employee board member RSUs generally will vest either over one year or three years, subject to the recipient’s continued service through the applicable vesting date or dates. The RSUs and options granted to employees are generally subject to a four-year vesting schedule and all vesting generally shall be subject to the recipient’s continued service with the Company or its subsidiaries through the applicable vesting dates.

The table below summarizes the activity pursuant to the 2021 Plan, for the six months ended June 30, 2024, and the shares available for future issuances as of June 30, 2024.


	Shares Available for Future Issuance
Shares available as of December 31, 2023		8,310
Stock options issued, net		(2,527	)
RSUs issued, net		(1,352	)
Shares available as of March 31, 2024		4,431
Additions to the plan		8,900
RSUs issued, net		(335	)
Shares available as of June 30, 2024		12,996

The table below summarizes the activity related to stock options, pursuant to the 2018 Stock Plan and 2021 Plan, for the six months ended June 30, 2024.


	Options Outstanding
	Number of Options			Weighted- Average Exercise Price ($ per share)		Weighted Average Remaining Contractual Life (years)		Aggregate Intrinsic Value
December 31, 2023		9,158		$	1.21		6.81	$	18,112
Granted		2,527		$	3.36
Exercised		(192	)	$	0.47
March 31, 2024		11,493		$	1.70		7.30	$	13,504
Forfeited		(347	)	$	2.96
June 30, 2024		11,146		$	1.66		7.09	$	11,646
Exercisable options as of June 30, 2024		6,670		$	0.75		5.81	$	11,240

During the three months ended June 30, 2024 and 2023, stock-based compensation expense of $674 and $369, respectively, was recognized in connection with the outstanding options. During the six months ended June 30, 2024 and 2023, stock-based compensation expense of $1,366 and $800, respectively, was recognized in connection with the outstanding options. As of June 30, 2024, there is $8,224 of unrecognized compensation expense related to stock options, which is expected to be recognized over a weighted-average period of 3.2 years.

The table below summarizes the activity related to RSUs, pursuant to the 2018 Plan and 2021 Plan, for the six months ended June 30, 2024.


	Restricted Stock Units
	Number of Restricted Stock Units			Weighted Average Grant Date Fair Value (per share)
December 31, 2023		4,461		$	4.24
Granted		1,747		$	3.32
Vested or distributed		(776	)	$	3.89
Forfeited		(579	)	$	3.69
March 31, 2024		4,853		$	4.04
Granted		369		$	2.70
Vested or distributed		(567	)	$	4.43
Forfeited		(181	)	$	4.06
June 30, 2024		4,474		$	3.88

No right to any Class A Common Stock is earned or accrued until such time that vesting occurs, nor does the grant of the RSU award confer any right to continue vesting or employment or other service. Compensation expense associated with the unvested RSUs is recognized on a straight-line basis over the vesting period.

During the three months ended June 30, 2024 and 2023, stock-based compensation expense of $2,576 and $2,875, respectively, was recognized in connection with the vesting of all RSUs. During the six months ended June 30, 2024 and 2023, stock-based compensation expense of $5,142 and $5,992, respectively, was recognized in connection with the vesting of all RSUs. As of June 30, 2024, there is $15,416 of unrecognized compensation expense related to restricted stock units, which is expected to be recognized over a weighted-average period of 2.2 years.

The Company has the ability to initially issue up to 2,000 shares of Class A Common Stock under the ESPP, subject to annual increases effective as of January 1, 2022, and each subsequent January 1 through and including January 1, 2030, in an amount equal to the smallest of (i) 1% of the number of shares of the Class A Common Stock outstanding as of the immediately preceding December 31, (ii) 2,000 shares or (iii) such amount, if any, as the Board may determine.

The ESPP allows employees to purchase shares of the Company's Class A Common Stock approximately every six months at a per share purchase price equal to 85 percent of the quoted market price of a share of the Company’s Class A Common Stock on (i) the first day of the offering period or (ii) the applicable purchase date of such offering period, whichever quoted market price is lower. During the three months ended June 30, 2024 and 2023, stock-based compensation expense of $34 and $32, respectively, was recognized in connection with the ESPP. During the six months ended June 30, 2024 and 2023, stock-based compensation expense of $57 and $55, respectively, was recognized in connection with the ESPP.


ESPP Activity	Shares Available for Sale
December 31, 2023		5,402
Annual additions to the plan		2,000
Shares purchased		(134	)
March 31, 2024		7,268
<no activity in Q2'24>		-
June 30, 2024		7,268

During the six months ended June 30, 2024 and 2023, there were options granted covering 2,527 and 3,070 shares, respectively. During the three months ended June 30, 2024 and 2023, there were no options granted. The fair value of stock option grants is estimated by the Company on the date of grant using the Black Scholes option pricing model with the following weighted-average assumptions for the six months ended June 30, 2024 and 2023.


	For the six months ended June 30,
	2024		2023
Risk free interest	4.09%			3.55	%
Dividend yield	0.00%		0.00%
Expected volatility	75.00%			75.00	%
Expected life (years)		6.25		6.08

The Company recorded stock-based compensation expense as follows.


	For the three months ended June 30,				For the six months ended June 30,
	2024		2023		2024		2023
Cost of revenue	$	292	$	253	$	590	$	504
Research and development		953		912		1,914		1,890
Sales and marketing		165		182		296		418
General and administrative		1,874		1,929		3,765		4,144
Total	$	3,284	$	3,276	$	6,565	$	6,956

During the six months ended June 30, 2023, stock-based compensation expense of $109 was recognized for 844 shares granted in connection with the Company's February 2020 acquisition of a foreign supplier and are recorded as a component of general and administrative expense. There was no such stock-based compensation expense recording during the six months ended June 30, 2024 or the three months ended June 30, 2024 and 2023.