Note 11 - Stock Award Plans and Stock-Based Compensation

In 2011, the Company adopted the 2011 Employee Stock Incentive Plan (the “2011 Plan”). The 2011 Plan terminated by its terms on August 31, 2021 and remains in effect as to outstanding equity awards granted prior to the date of expiration. No new awards will be issued under the 2011 Plan.

Legacy XTI adopted the 2017 Employee and Consultant Stock Ownership Plan, which was assumed by the Company in connection with the XTI Merger. The plan permits grants of stock options and other equity awards to employees, directors and consultants. As of December 31, 2025, no shares remain available for future issuance under the 2017 Plan.

The Company’s 2018 Equity Incentive Plan, as amended and restated in August 2025, authorizes the grant of incentive stock options, nonqualified stock options, restricted stock, RSUs and other equity-based awards to employees, officers, directors and consultants. The 2018 Plan permits the Board to delegate limited grant authority to designated officers. Options generally vest over periods ranging from immediate to four years and have contractual terms of up to ten years.

As of December 31, 2025, there are no unvested Restricted Stock or Restricted Stock Units outstanding under the 2018 Plan.

The aggregate number of shares that may be awarded under the 2018 Plan as of December 31, 2025 was 80,105,687. As of December 31, 2025, 64,166,804 shares of common stock were available for future grant under the 2018 Plan, of which 57,209,296 shares are registered.

See below for a summary of the stock options granted under the 2011, 2017 and 2018 plans:

During the year ended December 31, 2025, the Company granted 15,893,584 stock options under the 2018 Plan to employees, directors, and other service providers with exercise prices ranging from $1.26 to $2.00 per share.

The following assumptions were used in estimating the fair values of options awarded during the year ended December 31, 2025:

The range in expected term reflects both newly granted awards and modifications to certain previously granted options, including extensions of contractual terms from 90 days to up to ten years, which resulted in longer expected terms for those awards.

The following assumptions were used in estimating the fair values of options awarded during the year ended December 31, 2024:

Stock-based Compensation Expense

Stock-based compensation charges for the periods indicated below (in thousands) are as follows:

As of December 31, 2025, the total unrecognized compensation expense related to unvested awards was approximately $16.4 million, which the Company expects to recognize over an estimated weighted average period of 1.03 years.

In October 2025, the Board approved an extension of the post-termination exercise period from 90 days to ten years for certain previously granted stock options. The extension constituted a modification under ASC 718, Compensation—Stock Compensation. The Company remeasured the affected awards on the modification date and recognized incremental compensation cost of approximately $0.6 million, representing the excess of the fair value of the modified awards over the fair value of the original awards immediately prior to modification. The incremental compensation cost was recognized immediately for awards that were vested as of the modification date, with the remaining cost related to unvested awards recognized over the remaining vesting period.

During the year ended December 31, 2025, the Company issued 125,000 shares of restricted common stock to a third-party advisor in exchange for financial advisory services. The Company recognized $0.2 million of stock-based compensation expense related to this award during the year ended December 31, 2025.