7. Stock-Based Compensation

On April 28, 2025, Mo Hayat, Chris Marlett, George Brandon, and Anthony DiGiandomenico voluntarily relinquished their outstanding restricted stock units (RSUs) in exchange for stock options for an equivalent number of Class A shares and similar vesting schedules. This exchange was executed as part of a broader equity compensation strategy aimed at aligning long-term incentives with shareholder value creation. The terms of the stock options, including exercise price and vesting schedules, were approved by the Company’s Board of Directors in accordance with the existing equity incentive plan and Section 16 of the Exchange Act.

Between April 19, 2022 and September 21, 2022, the Company granted 3.7 million restricted stock units (“RSUs”). These units vested 20% of one-half of the total number of RSUs, by each individual person, on the thirteenth (13) month anniversary, October 20, 2024, of the listing of the Class A Shares on a United States national exchange, then vesting would be at a rate of 10% of one-half the number of RSUs each six months after the date of the initial vesting, until the last vesting on the fifth year anniversary of the date of grant, at which any previously unvested would fully vest. These RSUs were granted to officers, directors, employees, and contractors. These RSU began to vest upon the completion of the initial public offering by the Company on September 20, 2023, compensation expense related to these RSUs has been recorded. The Company expensed the RSUs based on the average expense over the vesting period. In 2024 an additional 295 thousands RSUs were granted, 320 thousand RSUs were either canceled or forfeited, and 655 thousand RSUs vested. The total unrecognized compensation expense based on the share price sold in the 2022 private placement as of December 31, 2025 was $6.0 million. The weighted average of the remaining restricted stock units at December 31, 2025 was 1.6 years and at December 31, 2024 was 2.4 years. During the year ended December 31, 2025, 128 thousand RSUs were canceled due to holder leaving the Company and 1.6 million RSUs were exchanged and converted to stock options. As a result of the modification, the fair value of the awards immediately after the modification was determined to be $6.0 million compared to the fair value of the original restricted stock unit awards of $6.8 million immediately prior to the modification. The modification resulted to a decrease in the aggregate fair value of the awards and in accordance with ASC 718-Compensation—Stock Compensation, no incremental compensation costs need to be recognized over the remaining requisite service period.

On April 19, 2022 the Company granted 2 million restricted stock units (“RSUs”). These units will vest 20% of one-half of the total number of RSUs, by each individual person, starting on the thirteenth (13) month anniversary of the listing of the Class A Shares on a United States national exchange, October 20, 2024, when a Class A Share has traded in the market on which the Class A Shares are listed for any 90 consecutive calendar days at an average price of $20.00 or more during the period commencing the date of grant and prior to the five year anniversary of the date of grant, with an average monthly trading volume of 2 million Class A Shares or more during the 90 consecutive calendar day period, or a Class A Shares has traded in the market on which the Class A Shares are listed for any 90 consecutive calendar days at an average price of $25.00 or more during the period commencing the date of grant and prior to the five year anniversary of the date of grant; provided further, that if there is a distribution of cash, stock or other property by the Company on the Class A Shares, then the foregoing average amounts of $20.00 or $25.00 will be reduced, from time to time, by the value of any one or more per share distributions after the date of grant until vested. As these RSUs did not begin to vest until the completion of an initial public offering, which was completed on September 20, 2023, by the Company, which was outside of the control of the Company, compensation expense related to these RSUs has been recorded. On April 28, 2025 all of the market based RSUs were modified and exchanged for stock options in their place. The unvested portion of the market based RSUs was $8.7 million and the incremental value of $5.5 million in the exchange for a total amortized amount of $14.2 million that will be amortized over the 10ten-year life of the award. There is not an estimated unrecognized compensation expense, as all the RSUs were modified and exchanged for stock options.

A summary of restricted stock unit activity during the year ended December 31, 2025 and the year ended December 31, 2024 is presented below (in thousands, except for share price):

 Schedule of Restricted Stock Unit Activity 

On April 28, 2025, in exchange for 1.6 million unvested time-based RSUs, stock options to purchase 1.6 million shares of Common Shares were granted at an exercise price of $4.25 per share, which was equal to the closing price of the Common Shares immediately prior to the date of grant, and are exercisable for a period of 10 years. One-half of the stock options vested immediately on grant, with the remaining stock options vesting ratably over a period of 2 years, subject to continued service. The inputs used to determine the fair value of this stock option grant were as follows: (1) Common Stock price of $4.25 per share; (2) exercise price of $4.25 per share; (3) expected life of 10 years; (4) risk-free interest rate of 4.23%; (5) expected annual volatility of 85.65%; and (6) an annual dividend rate of 0%. The total unrecognized compensation expense based on the pre-modification valuation of the shares price sold in the 2022 private placement as of December 31, 2025 was $6.9 million.

A summary of time-based stock option activity during the year ended December 31, 2025 and the year ended December 31, 2024 is presented below (in thousands, except for share price and contractual life):

Schedule of Time-Based Stock Option Activity  

In addition, on April 28, 2025, in exchange for 2 million unvested market-based RSUs, stock options to purchase 2 million shares of Common Shares were granted at an exercise price of $4.25 per share, which was equal to the closing price of the Common Shares immediately prior to the date of grant, and are exercisable for a period of 10 years. The stock options vest if either (a) the Common Shares has traded in the market on which the shares are listed for at least 30 trading days at an average price per share of $20.00 or more, whether consecutive or non-consecutive, or (b) there are distributions of cash, stock or other property by the Company to the holders of the Common Shares, at a value per share of $20.00 or more in the aggregate, subject to continued service. Once vested, the stock options will be exercisable for the remainder of the 10-year grant date period. The total unrecognized compensation expense based on the post-modification valuation of the unamortized amount and the incremental value as of December 31, 2025 was $13.2 million.

A summary of market-based stock option activity during the year ended December 31, 2025 and the year ended December 31, 2024 is presented below (in thousands, except for share price and contractual life):

Schedule of Market-Based Stock Option Activity