Company: CRCT
Filing Date: 2025-08-06
Form Type: 10-Q
Source: 0001828962-25-000146
Chunk: 35

Company: Cricut, Inc.
Filing Date: 2025-08-06
Form: 10-Q
Item: Part I, Item 1
Chunk 35
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SUs under the 2021 Equity Incentive Plan to certain employees of the Company that represent shares potentially issuable in the future. In July 2024, the Company granted PRSUs by which the first tranche of 30% and the second tranche of 70% will vest upon the Company achieving certain adjusted operating income targets during any four consecutive quarters of the respective performance periods, subject to employees remaining with the Company through the vesting date. The performance periods for the first and second tranches is 4 and 5 years, respectively. Adjusted operating income means GAAP operating income adjusted to exclude stock-based compensation expense and payroll expense specifically related to these PRSU awards.

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In 2022, the Company granted PRSUs that vest in two equal tranches subject to the Company achieving certain cumulative adjusted earnings per share over eight quarters at any point during the 5-year performance period, subject to employees remaining with the Company through the vesting date. Adjusted earnings per share means GAAP net income adjusted to exclude income tax expenses, as well as stock-based compensation expense and payroll tax expense specifically related to these PRSU awards. A summary of the Company’s PRSU activity under the 2021 Equity Incentive Plan is as follows:Number ofPRSUs (a)Weighted-AverageGrant DateFair Value(per share)Outstanding at December 31, 202417,485,433 $13.12 Dividend equivalent grants302,525 $— Forfeited / cancelled(919,732)$12.08 Outstanding at June 30, 202516,868,226 $13.17 a.Represents the maximum number of PRSUs assuming all performance targets are achieved.The expense recognized each period for the PRSUs is primarily dependent upon the Company’s estimate of the probability of achieving the performance targets during the performance period. At June 30, 2025, the Company determined it was not probable any performance conditions would be achieved so no stock-based compensation was recorded for these PRSUs during the six months ended June 30, 2025. Options under the 2021 Equity Incentive Plan have a contractual term of 10 years. The exercise price of an incentive stock option and non-qualified stock option shall not be less than 100% of the fair market value of the shares on the date of grant.A summary of the Company’s stock option activity under the 2021 Equity Incentive Plan is as follows