Company: GURE
Filing Date: 2025-11-19
Form Type: 10-Q
Source: 0001193805-25-001627
Chunk: 31

Company: GULF RESOURCES, INC.
Filing Date: 2025-11-19
Form: 10-Q
Item: Item 1
Chunk 31
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 reverse stock split. All shares of common stock referenced in this report have been adjusted to reflect
the stock split figures.

Restricted Shares

A restricted stock award (“RSA”) is
an award of common shares that is subject to certain restrictions during a specified period. Restricted stock awards are independent of
option grants and are generally subject to forfeiture if employment terminates prior to the release of the restrictions. The grantee cannot
transfer the shares before the restricted shares vest. Shares of nonvested restricted stock have the same voting rights as common stock,
are entitled to receive dividends and other distributions thereon and are considered to be currently issued and outstanding. The Company
expenses the cost of the restricted stock awards, which is determined to be the fair market value of the shares at the date of grant,
straight-line over the period during which the restrictions lapse. For these purposes, the fair market value of the restricted stock is
determined based on the closing price of the Company's common stock on the grant date.

The Company granted an aggregate of 295,000 restricted shares
of common stock in January 2025 to a consultant, the Company's directors, officers, and an employee as compensation for services rendered
for the year ended December 31, 2024. The restricted shares award were granted under the 2019 Omnibus Equity Incentive Plan and vested
immediately. The fair value of the award on the date of grant was $194,700 which was expensed in full during the year ended December
31, 2024.

During the nine months ended September 30, 2025, the Company granted
in the aggregate, 265,000 restricted shares of common stock on March 21, 2025 to a consultant, the company's directors, officers
and an employee as compensation for services rendered for the current year. The restricted shares award were granted under the 2019 Omnibus
Equity Incentive Plan and vested immediately. The fair value of the award on the date of grant was $196,100 which was expensed in
full during the nine months period ended September 30, 2025.

Retained Earnings – Appropriated

In accordance with the relevant PRC regulations
and the PRC subsidiaries’ Articles of Association, the Company’s PRC subsidiaries are required to allocate its profit after
tax to the following reserve:

Statutory Common Reserve Funds

SCHC, SYCI, SHSI and DCHC are required each year
to transfer