GEN Restaurant Group, Inc. Stock Compensation Disclosure

In connection with the IPO, the Company granted restricted stock units (“RSUs”) to certain team members that generally vest on the five year anniversary of the grant date, or over a five year period with vesting of 20% each year. The non-employee directors of the Company received RSUs that vest on the first anniversary of the grant date, subject to the grantee's continued service through the vesting period, or upon termination from the Board of Directors for any reason other than for cause, a pro rated portion of the shares vest on the termination date. The employee grants vest in increments over a five year period. The total stock based compensation for the each of the years ended December 31, 2025 and 2024, was $3.0 million and is included in general and administrative expenses.

The aggregate fair value of the RSUs granted during the years ended December 31, 2025 and 2024 was $99 thousand and $0, respectively. The unrecognized stock-based compensation of $7.4 million as of December 31, 2025, will be recognized through July 2028. The Company issued 372,600 (or 9% of the shares of common stock sold in the offering) warrants in connection with the IPO to the underwriters. The warrants expire five years after the effective date of the registration and can be exercised on a cashless basis. As a result, the conversion of some or all of the warrants may dilute the ownership interests of existing shareholders.