Armata Pharmaceuticals, Inc. Stock Compensation Disclosure
10. Equity Incentive Plans
Stock Award Plans
The Company maintains a 2016 Equity Incentive Plan (the “2016 Plan”), which provides for the issuance of incentive share awards in the form of non-qualified and incentive stock options, stock appreciation rights, restricted stock awards, restricted stock unit awards and performance-based stock awards. The awards may be granted by the Company’s Board of Directors to its employees, directors and officers and to consultants. The term of the options granted is ten years, the exercise price is the Company’s closing price at the date of grant and the vesting period is usually four years. The Company also granted RSUs under the 2016 Plan that vest over four years.
Under the 2016 Plan, the number of shares authorized for issuance is automatically increased by a number equal to 5% of the total number of shares of the Company’s capital stock outstanding on December 31st of the preceding calendar year, or a lesser number of shares determined by the Board of Directors annually beginning from January 1, 2017 until January 1, 2026. As of December 31, 2025, there were 3,986,228 shares available for issuance under the 2016 Plan.
Pursuant to its 2016 Employee Stock Purchase Plan (“ESPP”), the Company may grant or provide for the grant of rights to purchase shares of its Common Stock. The number of shares of its Common Stock reserved for issuance under the ESPP will automatically increase on January 1st of each calendar year by the lesser of 1% of the total number of shares of the Company’s Common Stock outstanding on December 31st of the preceding calendar year and 30,000 shares, subject to the ability of the Company’s Board of Directors to take action to reduce the size of the increase in any given year. There were no awards issued under ESPP. As of December 31, 2025, the Company had reserved 14,032 shares for future grants under the ESPP.
Stock option transactions during the year ended December 31, 2025 are presented below:
Options Outstanding | ||||||||||
Weighted | ||||||||||
Average | ||||||||||
Weighted | Remaining | |||||||||
Average | Contractual | Aggregate | ||||||||
Exercise | Term | Intrinsic | ||||||||
| Shares | | Price | | (Years) | | Value (in thousands) | |||
Outstanding at December 31, 2024 |
| 3,755,965 | $ | 3.74 |
| 7.5 | $ | 4 | ||
Granted |
| 1,596,058 | $ | 2.04 |
|
| $ | — | ||
Exercised | (201,602) | $ | 3.26 | $ | 953 | |||||
Forfeited/Cancelled/Expired |
| (346,500) | $ | 3.38 |
|
| $ | 31 | ||
Outstanding at December 31, 2025 |
| 4,803,921 | $ | 3.22 |
| 7.4 | $ | 15,045 | ||
Vested and expected to vest at December 31, 2025 |
| 4,803,921 | $ | 3.22 |
| 7.4 | $ | 15,045 | ||
Exercisable at December 31, 2025 |
| 2,294,337 | $ | 3.94 |
| 6.0 | $ | 5,728 | ||
The aggregate intrinsic value of options at December 31, 2025 is based on the Company’s closing stock price on that date of $6.28 per share.
The weighted average grant date fair value of the options granted during 2025 and 2024 was $1.65 and $2.54, respectively. The fair value of vested options during the year ended December 31, 2025 and 2024 was $2.4 million and $2.8 million, respectively.
Restricted stock unit award transactions during the year ended December 31, 2025 are presented below:
Weighted Avg | |||||
Grant Date | |||||
| Shares | | Fair Value | ||
Outstanding at December 31, 2024 | 220,000 | $ | 2.73 | ||
Granted | — | $ | — | ||
Vested | (67,500) | $ | 2.65 | ||
Cancelled | — | $ | — | ||
Outstanding at December 31, 2025 | 152,500 | $ | 2.73 | ||
As of December 31, 2025, there was $2.1 million of total unrecognized compensation expense related to unvested stock options and restricted stock units, which the Company expects to recognize over the weighted average remaining period of approximately .
Stock-based Compensation
The Company estimates the fair value of stock options with performance and service conditions using the Black-Scholes valuation model.
The assumptions used to estimate the options fair value were as follows:
Year Ended December 31, | ||||
| 2025 | | 2024 | |
Risk-free interest rate | 4.22%-4.28% | 3.54%-4.25% | ||
Expected volatility | 99.64%-101.43% | 89.40%-92.50% | ||
Expected term (in years) | 5.5-7.0 | 5.1-7.0 | ||
Expected dividend yield | 0% | 0% | ||
The table below summarizes the total stock-based compensation expense included in the Company’s consolidated statements of operations for the periods presented (in thousands):
Year Ended December 31, | ||||||
| 2025 | | 2024 | |||
Research and development | $ | 999 | $ | 663 | ||
General and administrative |
| 1,611 |
| 2,230 | ||
Total stock-based compensation | $ | 2,610 | $ | 2,893 | ||
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Mar 25, 2026 | Showing above |
| 2024 | Mar 21, 2025 | |
| 2023 | Mar 21, 2024 | |
| 2022 | Mar 16, 2023 | |
About Stock Compensation Disclosures
Stock-based compensation disclosures detail the equity awards granted to employees and executives — including stock options, restricted stock units (RSUs), and performance shares — along with the valuation methods and assumptions used to expense them. This section reveals the true cost of talent retention and the alignment between management incentives and shareholder interests.
Key signals: total unrecognized compensation expense and its expected recognition period signal future earnings headwinds from already-granted awards. For stock options, examine Black-Scholes assumptions — expected volatility, risk-free rate, and expected term — as understating any of these reduces reported compensation expense. Compare stock compensation expense as a percentage of revenue against peers to assess dilution cost. Watch vesting schedules for acceleration clauses tied to change-of-control events. Performance-based awards with undemanding targets may indicate weak governance. Add back stock compensation to operating cash flow to calculate a more conservative free cash flow figure.