SHARE-BASED COMPENSATION (Tables)

3 Months Ended

Mar. 31, 2026

The following table summarizes stock option activity for the three months ended March 31, 2026:



			Weighted Average
	Options on Common Shares		Exercise Price	Remaining Contractual Terms	Aggregate Intrinsic Value

Outstanding December 31, 2025	6,449,534		2.05	8.56	3,706
Granted	4,197,500		2.21	-	-
Exercised	-		-	-	-
Forfeited, cancelled, expired	(300,000	)	2.45	-	-
Outstanding March 31, 2026	10,347,034		2.10	8.75	402
Exercisable March 31, 2026	3,072,524		2.31	7.79	141

Stock Option Activity, Fair Value of Assumptions

The Company uses the Black-Scholes option pricing model to determine the fair value of the service-based options that have been granted. The following table summarizes the assumptions used to compute the fair value of options granted to employees and non-employees:


	Three Months Ended March 31,
		2026			2025

Expected stock price volatility		76	%		76	%
Risk-free interest rate		3.87	%		4.28	%
Expected dividend yield		0	%		0	%
Expected life of options		6			6
Weighted-average fair value of options granted	$	1.55		$	1.47

Restricted Stock Units Activity

The 2017 Plan provides for the grant of restricted stock units (“RSUs”). RSUs are settled in shares of the Company’s Common Stock as the RSUs vest. The following table summarizes RSU activity for the three months ended March 31, 2026:


			Weighted Average
	Service-Based RSUs			Grant Date Fair Value	Vesting Period (Years)

Unvested at December 31, 2025	1,014,563		$	2.23	3.62
Granted service based	81,052			2.46	-
Vested	(72,888	)		2.26	-
Forfeited and cancelled	-			-	-
Unvested at March 31, 2026	1,022,727		$	2.25	3.69

Share-based Compensation for Options and Restricted Stock Units

The Company recorded share-based compensation for options and RSUs in its statements of operations for the relevant periods as follows:


	Three Months Ended March 31,
		2026		2025

Selling, general and administrative	$	2,384	$	1,603
Research and development		-		62
Total share-based expense	$	2,384	$	1,665

WRAP TECHNOLOGIES, INC. 10-Q