SHARE-BASED COMPENSATION

12 Months Ended

Dec. 31, 2024

Share-Based Payment Arrangement [Abstract]

SHARE-BASED COMPENSATION

NOTE 7 – SHARE-BASED COMPENSATION

The Company has an Equity Incentive Plan (the “Plan”) under which the Company may grant restricted stock awards and stock options for up to 150,000 ordinary shares. Both incentive stock options and non-qualified stock options expire ten years from the date of the grant or 90 days after the termination of employment of the grantee.

Stock Options

The fair value of options and share awards granted under the stock option plan during the year ended December 31, 2023 was estimated at the date of grant using the Black-Scholes option pricing model and the following assumptions for grants:

		2023
Risk-free interest rates			3.58% - 4.39%
Expected life of options			5 years
Expected volatility			83.12% - 92.32%
Expected dividend yield			0.00	%

The following table summarizes stock option activity:

SUMMARY OF STOCK OPTION ACTIVITY

		Number of Options				Weighted Average Exercise Price				Weighted Average Remaining Contractual Term
Balance at January 1, 2023			1,566			$	4,505.53
Granted			1,499				455.86
Forfeited/Expired			(55	)			4,797.05
Balance at December 31, 2023			3,010				2,482.84				8.71
Forfeited/Expired			(218	)			3,384.60
Balance at December 31, 2024			2,792				2,419.99				7.72
Exercisable at December 31, 2024			1,541			$	2,903.44				7.49

FREIGHT TECHNOLOGIES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The following table summarizes the Company’s non-vested stock options:

SUMMARY OF NON-VESTED STOCK OPTION

		Non-vested Options Outstanding				Weighted-Average Grant Date Fair Value
At January 1, 2023			1,301			$	2,574.83
Options granted			1,499				309.28
Options forfeited/cancelled			(16	)			85.43
Options vested			(466	)			2,474.57
At December 31, 2023			2,318				1,133.36
Options forfeited/cancelled			(142	)			953.74
Options vested			(924	)			1,014.71
At December 31, 2024			1,252			$	1,127.38

For the years ended December 31, 2024 and 2023, the Company recognized $977,006 and $1,092,820 of stock compensation expense relating to stock options, respectively. As of December 31, 2024, there was $1,497,176 of unrecognized stock compensation expense related to non-vested stock options granted under the Plan. The cost is expected to be recognized over a weighted-average period of approximately four years.

Restricted Stock Awards

From time-to-time the Company issues time-based restricted stock awards (“RSAs”) under the Plan. The fair value of the nonvested shares are measured at the market price of a share on the date of grant and will be recognized as share-based compensation expense over the requisite service period. Grants vest over a period ranging from one to four years based on continued employment or service. The ordinary shares underlying the RSAs are not considered issued and outstanding until vested.

The following table summarizes the restricted stock awards activity:

SUMMARY OF RESTRICTED STOCK AWARDS

		Restricted Stock Awards				Weighted-Average Grant Date Fair Value Per Share
Outstanding at January 1, 2023			11.95			$	3,468.54
Granted			80.00				443.90
Forfeited			(0.53	)			1.93
Vested			(86.50	)			704.77
Outstanding at December 31, 2023			4.92			$	3,468.54
Forfeited			(3.68	)			1,161.51
Vested			(1.24	)			3,468.54
Outstanding at December 31, 2024		$	-			$	-

For the years ended December 31, 2024 and 2023, the Company recognized $3,927 and $60,967 of stock compensation expense relating to RSAs, respectively. The decrease in year-over-year RSA related expense was primarily due to forfeitures from employee terminations. As of December 31, 2024, there was $0 of unrecognized share-based compensation expense related to non-vested RSAs. The cost is expected to be recognized over a weighted average period of approximately three years.

FREIGHT TECHNOLOGIES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS