Company: ARRY
Filing Date: 2025-11-05
Form Type: 10-Q
Source: 0001820721-25-000095
Chunk: 140

Company: Array Technologies, Inc.
Filing Date: 2025-11-05
Form: 10-Q
Item: Part I, Item 8
Chunk 140
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Performance Stock UnitsThe Company has granted performance-based restricted stock units (“PSUs”) to certain employees. The PSUs generally cliff vest after three years and upon meeting certain revenue and adjusted EPS targets. The PSUs also contain a modifier based on the total stock return compared to a certain index which modifies the number of PSUs that vest. PSUs were valued using a Monte-Carlo simulation method on the date of grant based on the U.S. Treasury Constant Maturity rates, and the assigned fair value on grant date is recognized on a straight-line basis over the vesting term of the awards. The probability of the awards meeting the performance related vested conditions is not included in the grant date fair value, but rather is estimated quarterly and the expense recognition is trued- up accordingly upon any probability to vest revision.Certain PSU awards do not yet have a grant date because not all of the performance criteria is known at inception. Until the grant date is established, these awards are remeasured at fair value each reporting period using a Monte Carlo simulation, and the associated expense is recognized and trued up quarterly based on the updated fair value and estimated probability of vesting.The following assumptions were used in the Monte Carlo simulation for computing the grant date fair value of the PSUs issued during the nine months ended September 30, 2025 and 2024:20252024Volatility79 %79 %Risk-free interest rate3.57 %4.62 %Dividend yield— %— %

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PSU activity under the 2020 Plan during the nine months ended September 30, 2025, was as follows:Number of SharesWeighted Average Grant Date Fair ValueOutstanding non-vested, December 31, 2024924,241 $12.76 Shares granted659,773 8.53 Shares vested— — Shares forfeited/canceled(57,237)5.29 Outstanding non-vested, September 30, 20251,526,777 $10.61 For three months ended September 30, 2025 and 2024, the Company recognized $4.6 million and $2.0 million, respectively, in equity-based compensation costs. For nine months ended September 30, 2025 and 2024, the Company recognized $11.3 million and $6.9 million, respectively, in equity-based compensation costs. These amounts include equity-based compensation related to RSUs, PSUs, and