15. STOCK-BASED COMPENSATION

On September 8, 2016, the Company adopted the 2016 Equity Incentive Plan (the “2016 Plan”). As of June 30, 2026, there were 29 options under the 2016 Plan. On February 6, 2025, the 2016 Plan was terminated and replaced with the 2025 Plan, and on August 1, 2025 the Board of Directors adopted the 2025 Plan.

2025 Equity Incentive Plan

The 2025 Plan initially authorized 4,588,802 shares of common stock, which was equal to 15% of the outstanding shares of common stock on a fully-diluted basis available for award under the 2025 Plan. The 2025 Plan provides for an annual increase to such available number of shares by 5% of the shares of common stock outstanding on a fully-diluted basis each year for a period of seven years, with the first such increase to occur on January 1, 2026. On January 1, 2026, the number of shares available for grant under the 2025 Plan increased by 1,855,548 shares. The 2025 Plan provides for the issuance of incentive stock options, non-statutory stock options, share appreciation rights, restricted shares, restricted share units, and other share-based awards. Awards generally vest based on continued service over periods ranging from one to three years. Stock options generally have a contractual term of ten years from the grant date.

Stock Options

A summary of all stock option activity as of and for six months ended June 30, 2026 is presented below:

 SCHEDULE OF STOCK OPTIONS ACTIVITY

As of June 30, 2026, there were 1,228,051 unvested options with an aggregate grant date fair value of $3.3 million. As of December 31, 2025, there were 1,084,000 unvested options with an aggregate grant date fair value of $3.8 million. The unvested options will vest in accordance with the vesting schedule in each respective option agreement, which is two years from the grant date. The aggregate intrinsic value of unvested options as of June 30, 2026 and December 31, 2025 was $0.2 million and $0.8 million, respectively. During the six months ended June 30, 2026, 898,051 options vested.

The Company uses the Black-Scholes valuation model to measure the grant-date fair value of stock options. The grant-date fair value of stock options issued to employees is recognized on a straight-line basis over the requisite service period.

Beeline Holdings, Inc.

Notes to Consolidated Financial Statements

June 30, 2026 and 2025

(unaudited)

To determine the fair value of stock options using the Black-Scholes valuation model, the calculation takes into consideration the effect of the following:

The calculation includes several assumptions that require management’s judgment. The expected term of the options is calculated using the simplified method described in GAAP. The simplified method defines the expected term as the average of the contractual term and the vesting period. Estimated volatility is derived from volatility calculated using historical closing prices of common shares of similar entities whose share prices are publicly available for the expected term of the options. The risk-free interest rate is based on the U.S. Treasury constant maturities in effect at the time of grant for the expected term of the options.

The following assumptions were used in the Black-Scholes valuation model for options granted during the six months ended June 30, 2026:

 SCHEDULE OF FAIR VALUE OF OPTIONS

There were no options issued for the six months ended June 30, 2025 and all options had vested.

The weighted-average grant-date fair value per share of stock options granted during the six months ended June 30, 2026 was $2.08 per share. The aggregate grant date fair value of the 698,000 options granted during the six months ended June 30, 2026 was $2.9 million.

For the six months ended June 30, 2026, net compensation expense related to stock options was $1.5 million and included in compensation, commissions and benefits in the consolidated statements of operations. As of June 30, 2026 and December 31, 2025, the total compensation expense related to stock options not yet recognized was $1.4 million and $3.0 million, respectively, which is expected to be recognized over a weighted-average period of 0.6 years and 0.9 years, respectively.

Restricted Stock Awards

RSAs represent issued shares of common stock that vest based on continued service. Compensation cost is measured based on the grant-date fair value of the Company’s common stock and recognized over the vesting period. Unvested RSAs are subject to forfeiture and are not considered outstanding for earnings per share purposes until vested.

A summary of all RSA activity as of and for the six months ended June 30, 2026 is presented below:

 SUMMARY OF ALL RSA ACTIVITY

Beeline Holdings, Inc.

Notes to Consolidated Financial Statements

June 30, 2026 and 2025

(unaudited)

Stock-based compensation expense related to RSAs for the six months ended June 30, 2026 was $0.3 million and included in general and administrative expenses in the consolidated statements of operations. The total value of RSA grants was $0.1 million for the six months ended June 30, 2026. As of June 30, 2026 and December 31, 2025, total unrecognized compensation cost related to unvested RSAs was $0.4 million and $0.7 million, respectively, which is expected to be recognized over a weighted-average period of 1.4 years and 1.2 years, respectively, and included in additional paid-in capital on the consolidated balance sheets.

There were no RSAs grants for the six months ended June 30, 2025.

Restricted Stock Units

Restricted stock units (“RSUs”) generally vest based on performance targets or continued service over a period of time and represent the right to receive one share of the Company’s common stock for each RSU that vests. The grant-date fair value of RSUs is measured based on the closing price of the Company’s common stock on the grant date. The Company accounts for forfeitures as they occur.

A summary of all RSU activity as of and for the six months ended June 30, 2026 is presented below:

SUMMARY OF ALL RSU ACTIVITY  

Stock-based compensation expense related to RSUs for the six months ended June 30, 2026 of $0.2 million was included in general and administrative expenses and $6,855 was included in compensation, commissions and benefits in the consolidated statements of operations. The total value of RSU grants was $38,100 for the six months ended June 30, 2026. As of June 30, 2026 and December 31, 2025, total unrecognized compensation cost related to unvested RSUs was $0.1 million and $0.2 million, respectively.

There were no RSUs issued for the six months ended June 30, 2025.

RSUs are settled in shares of the Company’s common stock upon vesting. Shares withheld to satisfy employee tax withholding obligations are accounted for as equity transactions.