Claritev CorpCTEV
Claritev Corp Stock Compensation Disclosure
Stock-Based Compensation
The Company operates under the 2020 Omnibus Incentive Plan. The purpose of the 2020 Omnibus Incentive Plan is to provide a means through which the Company may attract and retain key personnel whereby directors, officers, employees, consultants and advisors of the Company and its subsidiaries can acquire and maintain an equity interest in the Company, or be paid incentive compensation, including incentive compensation measured by reference to the value of Class A Common Stock, thereby strengthening their commitment to the welfare of the Company and aligning their interests with those of the Company's shareholders.
There are 5,396,250 total shares authorized under the plan and as of December 31, 2025 there are 2,178,504 shares of Class A common stock available for the issuance of awards under the 2020 Omnibus Incentive Plan and 357,915 shares available for issuance under our ESPP. The Company's CEO, with the approval of the Compensation Committee of the Board, determines participation and the allocation of the awards. Awards under the 2020 Omnibus Incentive Plan typically vest from 6 months to 4 years and are generally subject to either cliff vesting or graded vesting. Awards do not have non-forfeitable rights to dividends or dividend equivalents.
The Company has adopted an Incentive Compensation Clawback Policy in order to help ensure that incentive compensation is paid or awarded based on accurate financial results and the correct calculation of performance against incentive targets.
The Company has allocated stock-based compensation expenses under the 2020 Omnibus Incentive Plan and ESPP between Costs of services and General and administrative expenses in the consolidated statements of operations and comprehensive loss as follows (in thousands):
| Year Ended December 31, | |||||||||||||||||
| 2025 | 2024 | 2023 | |||||||||||||||
| Cost of services | $ | 10,325 | $ | 8,080 | $ | 5,532 | |||||||||||
| General and administrative | 25,768 | 18,565 | 12,486 | ||||||||||||||
| Total stock-based compensation expenses | $ | 36,093 | $ | 26,645 | $ | 18,018 | |||||||||||
There was $49.0 million of unrecognized compensation cost as of December 31, 2025 related to the outstanding awards which is expected to be recognized over a weighted average period of 20 months.
Non-qualified stock options
Non-qualified stock option activity is summarized below (in thousands, except price and years):
| Shares | Weighted Average Exercise Price | Weighted Average Remaining Contract Term (Years) | Aggregate Intrinsic Value | ||||||||||||||||||||
| Outstanding as of December 31, 2022 | 275 | $ | 276.40 | 8.9 Years | $ | — | |||||||||||||||||
| Awarded | — | — | |||||||||||||||||||||
| Forfeited | (6) | 198.40 | |||||||||||||||||||||
| Outstanding as of December 31, 2023 | 269 | $ | 278.02 | 8.9 Years | $ | 2 | |||||||||||||||||
| Awarded | 294 | 30.55 | |||||||||||||||||||||
| Forfeited | (31) | 264.21 | |||||||||||||||||||||
| Outstanding as of December 31, 2024 | 532 | $ | 142.13 | 8.0 years | $ | 439 | |||||||||||||||||
| Awarded | — | — | |||||||||||||||||||||
| Forfeited | (63) | 290.02 | |||||||||||||||||||||
| Outstanding as of December 31, 2025 | 469 | $ | 122.22 | 7.8 Years | $ | 3,866 | |||||||||||||||||
| Exercisable as of December 31, 2023 | 91 | $ | 295.60 | 8.3 Years | $ | 1 | |||||||||||||||||
| Exercisable as of December 31, 2024 | 157 | $ | 286.14 | 5.3 Years | $ | — | |||||||||||||||||
| Exercisable as of December 31, 2025 | 200 | $ | 210.22 | 7.0 years | $ | — | |||||||||||||||||
Restricted Stock and Restricted Stock Units
Restricted Stock Units activity is summarized below (in thousands, except per share data):
| Director RSUs | Employee RSUs | Employee PSUs | Weighted Average grant date fair value per share | ||||||||||||||||||||
| Unvested as of December 31, 2022 | 4 | 131 | — | $ | 4.44 | ||||||||||||||||||
| Awarded | 17 | 746 | — | 36.80 | |||||||||||||||||||
| Vested | (3) | (36) | — | 183.20 | |||||||||||||||||||
| Forfeited | — | (34) | — | 64.80 | |||||||||||||||||||
| Unvested as of December 31, 2023 | 18 | 807 | — | $ | 51.58 | ||||||||||||||||||
| Awarded | 30 | 988 | 215 | $ | 32.76 | ||||||||||||||||||
| Vested | (19) | (236) | — | 56.37 | |||||||||||||||||||
| Forfeited | (3) | (164) | (67) | 44.80 | |||||||||||||||||||
| Unvested as of December 31, 2024 | 26 | 1,395 | 148 | $ | 37.02 | ||||||||||||||||||
| Awarded | 51 | 1,477 | — | $ | 25.37 | ||||||||||||||||||
| Vested | (26) | (430) | — | 43.32 | |||||||||||||||||||
| Forfeited | — | (194) | (36) | 33.74 | |||||||||||||||||||
| Unvested as of December 31, 2025 | 51 | 2,248 | 112 | $ | 28.12 | ||||||||||||||||||
On March 1,2025, the Company granted a new type of award via the 2020 Omnibus Incentive Plan, in the form of cRSUs. The Company granted 565.6 thousand shares with a fair value at grant date of $8.2 million. The cRSUs vest in two tranches, one-half on each of the first and second anniversaries of the date of the grant. Each tranche of cRSUs is entitled to receive a cash payment equivalent to the fair market value of Class A common stock on the vesting date, subject to a cap of 4.0x the fair market value of Class A common stock on the grant date.
The fair value assigned to cRSUs is determined using the market price of the Company’s stock on the reporting date minus a call option valued using the Black-Scholes model. Expected volatility in the model was estimated based on the volatility of historical stock prices over a period matching the expected term of the award or one-year period if the expected term of the award is less than a year. The risk-free interest rate is based on U.S. Treasury yield constant maturities for a term matching the expected term of the award. The following table summarizes the key assumption used to determine the fair value of the cRSUs:
| December 31, 2025 | March 1, 2025 | ||||||||||||||||||||||
Tranche 1 | Tranche 2 | Tranche 1 | Tranche 2 | ||||||||||||||||||||
| Expected terms | 0.2 year | 1.2 years | 1.0 year | 2.0 years | |||||||||||||||||||
| Expected volatility | 102.5 | % | 125.0 | % | 152.5 | % | 122.5 | % | |||||||||||||||
| Risk-free rate | 3.7 | % | 3.5 | % | 4.1 | % | 4.0 | % | |||||||||||||||
| Dividend yield | — | % | — | % | — | % | — | % | |||||||||||||||
| Fair value of cRSUs (per unit) | $ | 42.20 | $ | 28.00 | $ | 15.50 | $ | 13.60 | |||||||||||||||
The Company classifies the cRSUs as a liability included in Accrued compensation on the consolidated balance sheets as the vesting results in payment of cash by the Company. The cRSUs are adjusted to fair value at each reporting date.
ESPP
Our ESPP allows eligible employees to contribute a portion of their base earnings toward the quarterly purchase of our Class A common stock. The purchase price is 85% of the fair market value of the stock on the last business day of the offering period. The number of shares issued under our ESPP were as follows:
| Year Ended December 31, | |||||||||||||||||
| 2025 | 2024 | 2023 | |||||||||||||||
Number of shares issued | 51,994 | 79,943 | 10,403 | ||||||||||||||
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.