STOCK-BASED COMPENSATION

3 Months Ended

Mar. 31, 2026

Share-Based Payment Arrangement [Abstract]

STOCK-BASED COMPENSATION

NOTE 12 – STOCK-BASED COMPENSATION

Prior to May 17, 2023, the Company had previously granted stock options and stock awards under the Abeona Therapeutics Inc. 2015 Equity Incentive Plan (the “2015 Incentive Plan”). As of May 17, 2023, no further grants can be made under the 2015 Incentive Plan. The Company now grants stock options and stock awards under the Abeona Therapeutics Inc. 2023 Equity Incentive Plan (the “2023 Incentive Plan”) which was approved by stockholders on May 17, 2023. On April 24, 2024, stockholders approved an amendment to the 2023 Incentive Plan to increase the shares authorized for issuance from 1,700,000 shares to 3,200,000 shares. On December 20, 2024, stockholders approved an additional increase in the shares authorized for issuance under the 2023 Incentive Plan from 3,200,000 shares to 8,400,000 shares. As of March 31, 2026, there were 1,498,405 shares available to be granted under the 2023 Incentive Plan. In addition, in 2023, the Company’s board of directors approved various restricted stock awards granted to certain new hires as inducement grants. On October 10, 2023, the Company’s board of directors approved the Abeona Therapeutics Inc. 2023 Employment Inducement Equity Incentive Plan (the “Inducement Plan”). As of March 31, 2026, there were 184,426 shares available to be granted under the Inducement Plan.

The following table summarizes stock-based compensation (in thousands):

SCHEDULE OF STOCK BASED COMPENSATION


		For the three months ended March 31,
		2026				2025

Research and development		$	223			$	670
Selling, general and administrative			2,734				2,031
Total stock-based compensation expense		$	2,957			$	2,701

Stock Options

The Company estimates the fair value of each option award on the date of grant using the Black-Scholes option-pricing model. The Company then recognizes the grant date fair value of each option as compensation expense ratably using the straight-line attribution method over the service period (generally the vesting period). The Black-Scholes model incorporates the following assumptions:

	●	Expected volatility – the Company estimates the volatility of the share price at the date of grant using a “look-back” period which coincides with the expected term, defined below. The Company believes using a “look-back” period which coincides with the expected term is the most appropriate measure for determining expected volatility.

	●	Expected term – the Company estimates the expected term using the “simplified” method, as outlined in SEC Staff Accounting Bulletin No. 107, “Share-Based Payment.”

	●	Risk-free interest rate – the Company estimates the risk-free interest rate using the U.S. Treasury yield curve for periods equal to the expected term of the options in effect at the time of grant.

	●	Dividends – the Company uses an expected dividend yield of zero because the Company has not declared nor paid a cash dividend, nor are there any plans to declare a dividend.

The Company did not grant any stock options in the three months ended March 31, 2026 and 2025.

The Company accounts for forfeitures as they occur, which may result in the reversal of compensation costs in subsequent periods as the forfeitures arise.

The following table summarizes stock option activity during the three months ended March 31, 2026.

SCHEDULE OF STOCK OPTION ACTIVITY

		Number of Options				Weighted Average Exercise Price				Weighted Average Remaining Contractual Term (years)				Aggregate Intrinsic Value (in thousands)

Outstanding at December 31, 2025			176,019			$	38.72				4.85			$	5
Granted			—			$	—				—			$	—
Cancelled/forfeited			(1,199	)		$	36.67				—			$	—
Exercised			—			$	—				—			$	—
Outstanding at March 31, 2026			174,820			$	38.74				4.53			$	2
Exercisable			174,620			$	38.77				4.53			$	2
Unvested			200			$	4.00				6.20			$	—

The aggregate intrinsic value of options is calculated as the difference between the exercise price of the underlying options and the fair value of the Company’s common stock for those options that had exercise prices lower than the fair value of the Company’s common stock. As of March 31, 2026, the total compensation cost related to non-vested option awards not yet recognized was $1,000 with a weighted average remaining vesting period of 0.2 years.

Restricted Stock

The following table summarizes restricted stock award activity during the three months ended March 31, 2026:

		Number of Awards				Weighted Average Grant Date Fair Value Per Unit

Outstanding at December 31, 2025			4,180,981			$	4.96
Granted			2,044,890			$	5.29
Cancelled/forfeited			(221,922	)		$	5.06
Vested			(913,224	)		$	5.26
Outstanding at March 31, 2026			5,090,725			$	5.03

As of March 31, 2026, there was $20.5 million of total unrecognized compensation expense related to unvested restricted stock awards, which is expected to be recognized over a weighted average vesting period of 2.1 years. The total fair value of restricted stock awards that vested was $4.8 million during the three months ended March 31, 2026.