Company: AWRE
Filing Date: 2025-08-01
Form Type: 10-Q
Source: 0000950170-25-101395
Chunk: 16

Company: AWARE INC /MA/
Filing Date: 2025-08-01
Form: 10-Q
Item: Item 8
Chunk 16
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30, 2025, the Company granted stock options to purchase an aggregate of 348,125 and 1,513,322 shares of common stock under the 2023 Equity and Incentive Plan, respectively. No stock options were granted during the corresponding periods in 2024, and no stock options were exercised in the three and six months ended June 30, 2025 or 2024.  Of the total stock options granted in the three and six months ended June 30, 2025, 348,125 and 675,965, respectively, were granted as incentive stock options.  The remaining stock options granted in the three and six months ended June 30, 2025 were granted as non-qualified stock options. The stock options granting during the six months ended June 30, 2025 included 105,000 incentive stock options to a recently hired executive officer and 1,060,197 options, comprising both incentive and non-qualified options granted to Ajay Amlani, in connection with his appointment as the Company’s Chief Executive Officer.  Within the grant to Mr. Amlani, 848,157 options are subject to time-based vesting, with 25 percent vesting on the one-year anniversary of the grant date and the remaining 75 percent vesting 

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in 36 equal monthly installments thereafter, subject to Mr. Amlani's continued service. The remaining 212,040 options granted to Mr. Amlani are performance-based and divided equally between two tranches. The first tranche is eligible to vest if certain minimum bookings growth for 2025 thresholds are met, with incremental vesting for higher levels of growth up to a maximum threshold.  The second tranche is subject to similar performance conditions based on year-over-year bookings growth in 2026. In both cases, Mr. Amlani must remain in service through December 31 of the applicable performance year for any shares to vest.  Expense recognition for the option grant is based on the fair value on the grant date and reflects management’s assessment of the probability of achieving the specified performance conditions. Expense is recognized over the requisite service period and is adjusted for changes in the probability of achievement, as necessary.Restricted Stock Units - The 2023 Plan permits us to grant restricted stock units to our directors, officers, and employees. Upon vesting, each restricted stock unit entitles the recipient to receive a number of shares of common stock as set forth in the relevant restricted