Share-based Compensation

3 Months Ended

Mar. 31, 2026

Share-based Compensation

Share-based Compensation

Note 9. Share-based Compensation

2019 Incentive Award Plan

The following table summarizes stock option activity under the 2019 Award Plan:

		Weighted
		Average
	Number of	Exercise
	Shares	Price
Outstanding, January 1, 2026	47,955	$	720.00
Options granted	—		—
Options forfeited	—		—
Outstanding, March 31, 2026	47,955	$	720.00
Exercisable, March 31, 2026	47,516	$	720.00

As of March 31, 2026 and December 31, 2025, the weighted average remaining contractual life of options outstanding and options exercisable was 4.8 years and 5.0 years, respectively.

During the three months ended March 31, 2026 and 2025, the Company recognized $0.2 million and $0.6 million, respectively, of share-based compensation expense related to stock options granted.

As of March 31, 2026, there was no unrecognized compensation expense related to nonvested stock options.

The following table summarizes restricted stock units activity under the 2019 Award Plan:

		Weighted
		Average
	Number of	Grant Date
	Shares	Fair Value
Outstanding, January 1, 2026	9,351	$	780.48
Granted	—		—
Vested	—		—
Forfeited	—		—
Outstanding, March 31, 2026	9,351	$	780.48

During the three months ended March 31, 2026 and 2025, the Company recognized $0.3 million and $0.3 million, respectively, of share-based compensation expense related to restricted stock units granted, excluding restricted stock units with earnout vesting criteria. For the restricted stock units with earnout vesting criteria, in the third quarter of 2025, the Company determined that the earnout vesting criteria was no longer probable and as such, there was no share-based compensation expense during the three months ended March 31, 2026. During the three months ended March 31, 2025, the Company recognized $0.1 million of share-based compensation expense related to the restricted stock units with earnout vesting criteria.

As of March 31, 2026, total unrecognized compensation expense related to nonvested restricted stock units, excluding restricted stock units with earnout vesting criteria, was $1.4 million, which is expected to be recognized over the weighted-average remaining requisite service period of 10 months. The unrecognized compensation expense for restricted stock units with the earnout criteria as of March 31, 2026 of $4.7 million will be recognized when the milestones are determined to be probable over the RSUs vesting term, calculated as the period from the date the milestone was determined to be probable and the expected achievement date of the milestone.

2023 Incentive Award Plan

As of March 31, 2026, there were 17,847,331 shares of common stock available for issuance under the Company’s 2023 Incentive Award Plan (the “2023 Award Plan”). The following table summarizes stock options activity under the 2023 Award Plan:

		Weighted
		Average
	Number of	Exercise
	Shares	Price
Outstanding, January 1, 2026	51,016	$	242.14
Options granted	—		—
Options forfeited	—		—
Outstanding, March 31, 2026	51,016	$	242.14
Exercisable, March 31, 2026	45,160	$	169.94

The weighted average remaining contractual life of options outstanding and options exercisable as of March 31, 2026 and December 31, 2025 was 8.2 years and 8.5 years, respectively.

During the three months ended March 31, 2026 and 2025, the Company recognized $0.5 million, and $0.6 million respectively, of share-based compensation expense related to stock options granted. As of March 31, 2026, total unrecognized compensation expense related to nonvested stock options was $2.1 million, which is expected to be recognized over the weighted-average remaining requisite service period of 17 months.

The following table summarizes restricted stock units activity under the 2023 Award Plan:

		Weighted
		Average
	Number of	Grant Date
	Shares	Fair Value
Outstanding, January 1, 2026	14,215	$	60.05
Granted	10,928,059		1.03
Vested	—		—
Forfeited	—		—
Outstanding, March 31, 2026	10,942,274	$	1.10

In May 2025, due to equity pool limitations, the Company’s board of directors approved the issuance of cash-settled restricted stock units to employees and directors over a vesting period that entitle the grantee to receive the cash equivalent to the value of a share of the Company’s common stock upon each vesting anniversary. The Company elected to account for cash-settled restricted stock units in accordance with ASC 718. The Company will recognize compensation expense on the condensed consolidated statement of operations and comprehensive (loss) income and record the associated liability to accrued compensation on the condensed consolidated balance sheets using straight-line method over the service period. Additionally, changes in fair value of the awards will be recorded to operating costs on the condensed consolidated statement of operations and comprehensive (loss) income at each reporting date until settlement, reflecting changes in the underlying stock price.

In March 2026, the Company’s board of directors approved the conversion of all cash-settled restricted stock units awards into share-settled restricted stock units. The Company assessed the modification in accordance with ASC 718 Stock-based Compensation, and recorded $2.0 million to additional paid in capital, representing the fair value of the converted awards on the modification date.

During the three months ended March 31, 2026 and 2025, the Company recognized $0.9 million and $0.1 million stock-based compensation expenses related to restricted stock units granted.

As of March 31, 2026, total unrecognized compensation expense related to nonvested restricted stock units was $9.1 million, which is expected to be recognized over the weighted-average remaining requisite service period of 35 months.

2025 Employee Inducement Incentive Award Plan

As of March 31, 2026, there were 1,268,825 shares of common stock available for issuance under the 2025 Employee Inducement Incentive Award Plan (the “2025 Plan”), including 1,000,000 shares that were approved in March 2026 by the Company’s board of directors to be added to the 2025 Plan.

The following table summarizes stock options activity under the 2025 Plan:

		Weighted
		Average
	Number of	Exercise
	Shares	Price
Outstanding, January 1, 2026	59,034	$	0.41
Options granted	—		—
Options forfeited	—		—
Outstanding, March 31, 2026	59,034		0.41
Exercisable, March 31, 2026	—	$	—

The weighted average remaining contractual life of options outstanding and options exercisable as of March 31, 2026 and December 31, 2025 was 9.1 years and 9.3 years, respectively. During the three months ended March 31, 2026, the Company recognized de minimis amounts of share-based compensation expense related to stock options granted. As of March 31, 2026, total unrecognized compensation expense related to nonvested stock options was $17 thousand, which is expected to be recognized over the weighted-average remaining requisite service period of 37 months.

The following table summarizes restricted stock units activity under the 2025 Plan.

		Weighted
		Average
	Number of	Grant Date
	Shares	Fair Value
Outstanding, January 1, 2026	672,141	$	0.65
Granted	—		—
Vested	—		—
Forfeited	—		—
Outstanding, March 31, 2026	672,141	$	0.65

During the three months ended March 31, 2026, the Company recognized de minimis amounts of share-based compensation expense related to restricted stock units granted. As of March 31, 2026, total unrecognized compensation expense related to nonvested restricted stock units was $1.0 million, which is expected to be recognized over the weighted-average remaining requisite service period of 44 months.

Share-based Compensation Expense and Valuation Information

The Company accounts for the measurement and recognition of compensation expense for all share-based awards based on the estimated fair value of the awards. The fair value of share-based awards is amortized on a straight-line basis over the requisite service period. The Company records share-based compensation expense net of actual forfeitures.

During the three months ended March 31, 2026 and 2025, the Company recognized $1.9 million and $1.7 million, respectively, of share-based compensation expense, of which $1.5 million, and $1.3 million, respectively, were in selling, general and administrative expenses, and $0.4 million and $0.4 million respectively, were in research and development expenses in the accompanying condensed consolidated statements of operations and comprehensive (loss) income.