(10) Share-Based Compensation

2013 Equity Incentive Plan

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In 2013, the Company adopted the 2013 Equity Incentive Plan ( the “2013 Plan”) which provided for the grant of qualified incentive stock options (“ISOs”) and nonqualified stock options (“NSOs”), restricted stock, restricted stock units (“RSUs”) or other awards to the Company’s employees, officers, directors, advisors, and outside consultants. After the Business Combination became effective on March 2, 2022, no additional awards were issued under the 2013 Plan. Awards outstanding under the 2013 Plan will continue to be governed by such plan; however, the Company will not grant any further awards under the 2013 Plan.

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2022 Equity Incentive Plan

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In connection with the Business Combination, the shareholders approved the Rigetti Computing, Inc. 2022 Equity Incentive Plan (the “2022 Plan”) which provides for the grant of ISOs, NSOs, stock appreciation rights, restricted stock awards, RSUs, performance awards and other forms of awards to employees, directors, and consultants, including employees and consultants of the Company’s affiliates. As of June 30, 2025, there were 32,403,747 shares of Common Stock reserved for issuance under the 2022 Plan, of which 20,817,292 shares remain available for future issuance. The number of shares reserved for issuance under the 2022 Plan will automatically increase on January 1st of each year for a period of nine years commencing on January 1, 2023 and ending on (and including) January 1, 2032, in an amount equal to 5% of the total number of shares of Common Stock of all classes outstanding on a fully diluted basis on December 31st of the preceding year; provided, however, that the board of directors of the Company may act prior to January 1st of a given year to provide that the increase for such year will be a lesser number of shares of Common Stock. Accordingly, as of January 1, 2025, the number of shares of Common Stock reserved for issuance under the “2022 Plan” was increased by 15,972,015 shares.

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Stock Option Activity

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The following is a summary of stock option activity during the six months ended June 30, 2025:

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The Company’s outstanding stock options generally have exercise prices equal to fair market value on the date of grant, expire after ten years and have service-based vesting conditions ranging from 1-5 years, except that 500,000 stock options granted in 2022 had a market-based vesting condition tied to the Company’s Common Stock price. The vesting condition with respect to the market-based stock option grants was satisfied in January 2025. The intrinsic value of an option is the amount by which the market price of the underlying Common Stock exceeds the option’s exercise price. The intrinsic value of stock options exercised during the six months ended June 30, 2025 and June 30, 2024 was $17.4 million and $0.3 million, respectively. The Company received proceeds from stock option exercises of $1.4 million and $0.1 million during the six months ended June 30, 2025 and June 30, 2024, respectively.

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Stock-based compensation expense related to stock options granted to employees was $0.5 million and $1.0 million for the three and six months ended June 30, 2025, respectively. Stock-based compensation expense related to stock options granted to employees was $0.5 million and $0.9 million for the three and six months ended June 30, 2024, respectively. As of June 30, 2025, the unrecognized compensation expense related to unvested stock options was $3.3 million, which is expected to be recognized over a weighted-average period of 1.96 years.

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Fair Value of Stock Option Grants

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The fair value of each stock option award is estimated on the grant date using the Black-Scholes option-pricing model. No stock options were granted during the six months ended June 30, 2025. The weighted-average grant date fair value of stock options granted during the six months ended June 30, 2024 was $1.51 per share. The valuation assumptions used as inputs to the Black-Scholes option-pricing model to value the Company’s service-based stock options include expected volatility for the Company’s Common Stock, the expected term of the stock options granted, the assumed dividend yield and the risk free interest rate at the time of grant.

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For the first nine months of 2024, expected volatility for the Company’s Common Stock was determined based on a blended average of the historical volatility of a peer group of similar public companies, the historical volatility of the Company’s Common Stock and the implied volatility from the Company’s Public Warrants. For the last three months of 2024, expected volatility for the Company’s Common Stock was determined based on a one-third weighting of the historical volatility of a peer group of similar public companies and a two-thirds weighting of the historical volatility of the Company’s Common Stock. The implied volatility from the Company’s Public Warrants was excluded because the calculation did not produce a meaningful result. The Company has not been public for a sufficient length of time to derive expected volatility solely from trading in its Common Stock.

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The expected term of stock options granted was calculated using the simplified method, which represents the average of the contractual term and the weighted-average vesting period of the option. The Company uses the simplified method because it does not have sufficient historical exercise data for its options to provide a reasonable basis upon which to estimate the expected term.

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The assumed dividend yield is based upon the Company’s expectation of not paying dividends in the foreseeable future. The risk-free rate is based upon the U.S. Treasury yield curve in effect at the time of grant for the period equivalent to the expected term of the stock option. In determining the exercise prices for stock options granted, the Company’s board of directors has utilized the fair value of the Common Stock as of the grant date.

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Before the Business Combination, the fair value of the Common Stock had been determined by the board of directors at each award grant date based upon a variety of factors, including the results obtained from an independent third-party valuation, the Company’s financial position and historical financial performance, the status of technological developments within the Company, the composition and ability of the current engineering and management team, an evaluation or benchmark of the Company’s competition, the current business climate in the marketplace, the illiquid nature of the Company’s Common Stock, arm’s-length sales of the Company’s capital stock, the effect of the rights and preferences of the preferred shareholders, and the prospects of a liquidity event, among others.

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RSUs

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The following is a summary of RSU activity during the six months ended June 30, 2025:

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The Company’s RSUs generally have service-based vesting conditions ranging from 1-4 years, except that 3,850,000 RSUs granted in 2023 had a market-based vesting condition tied to the Company’s stock price. Based upon the terms of such awards, 50% of the shares became vested when the Company’s Common Stock traded at or above $2.00 per share and the other 50% of the shares became vested when the Company’s Common Stock traded at or above $4.00 per share, for 20 out of 30 trading days through the fifth anniversary of the grant date. The $2.00 per share vesting condition was satisfied in December 2024, and the $4.00 per share vesting condition was satisfied in January 2025.

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The income tax withholding obligation for all RSUs are satisfied through the sale of shares into the market, otherwise known as Sell-To-Cover (“STC”). The STC transaction and the income tax withholding remittance for the market-based RSUs that vested in December 2024 took place on December 30, 2024. The $6.3 million proceeds from the STC were received by the Company on January 2, 2025, and is included in other current assets in the accompanying balance sheet as of December 31, 2024.

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The aggregate fair value of outstanding RSUs based on the closing share price of the Company’s Common Stock as of June 30, 2025 and June 30, 2024 was $77.6 million and $10.3 million, respectively. The aggregate fair value of RSUs that vested based on the closing price of the Company’s Common Stock on the vesting date during the six months ended June 30, 2025 and June 30, 2024 was $52.7 million and $3.5 million, respectively.

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Fair Value of RSUs Awards

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The number of service-based RSUs granted during the six months ended June 30, 2025 and June 30, 2024 was 823,342 and 1,567,515, respectively. The service-based RSUs vest over periods ranging from 1-4 years and require continuous employment. The weighted-average grant date fair value of the service-based RSUs granted during the six months ended June 30, 2025 and June 30, 2024 was $9.08 and $1.46 per share, respectively. The fair value of the service-based RSUs was calculated based on the fair market value of the Company’s Common Stock on the date of grant.

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Stock-based compensation expense related to RSUs granted to employees was $3.0 million and $6.7 million for the three and six months ended June 30, 2025, respectively. Stock-based compensation expense related to RSUs granted to employees was $2.8 million and $5.5 million for the three and six months ended June 30, 2024, respectively. As of June 30, 2025, the unrecognized compensation expense related to unvested RSUs was $14.7 million, which is expected to be recognized over a weighted-average period of 2.09 years.

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Summarized Stock-Based Compensation Expenses

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The table below summarizes total stock-based compensation expenses for the three and six months ended June 30, 2025 and June 30, 2024 (in thousands):

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