Lineage Cell Therapeutics, Inc. Stock Compensation Disclosure
11. Stock-Based Awards
Equity Incentive Plan Awards
In September 2021, our shareholders approved the Lineage Cell Therapeutics, Inc. 2021 Equity Incentive Plan, and our shareholders approved amendments to increase the number of common shares that may be issued thereunder by 19,500,000 in September 2023 and by an additional 19,500,000 in June 2025 (as amended to date, the “2021 Plan”). The 2021 Plan provides for the grant of incentive stock options, non-statutory stock options, stock appreciation rights, restricted stock awards, RSUs, and other stock awards. Generally, all of our employees (including those of our affiliates), non-employee directors and consultants are eligible to participate in the 2021 Plan.
Subject to adjustment for certain changes in our capitalization, the aggregate number of our common shares that may be issued under the 2021 Plan will not exceed the sum of (i) 54,500,000 shares and (ii) the number of shares subject to awards granted under the Lineage Cell Therapeutics Inc. 2012 Equity Incentive Plan (the “2012 Plan”) that were outstanding when the 2021 Plan initially became effective in 2021 and are not issued because such awards expire or otherwise terminate. As a result of the approval of the 2021 Plan by our shareholders in 2021, no additional awards will be granted under the 2012 Plan. As of December 31, 2025, there were 35,837,519 shares available for grant under the 2021 Plan.
A summary of activity under the 2021 Plan is as follows (in thousands, except per share amounts):
|
|
Number |
|
|
Weighted |
|
|
Weighted |
|
|
Aggregate Intrinsic Value |
|
||||
Balance at December 31, 2024 |
|
|
16,658 |
|
|
$ |
1.30 |
|
|
|
8.23 |
|
|
$ |
— |
|
Options granted |
|
|
7,863 |
|
|
$ |
0.56 |
|
|
|
|
|
|
|
||
Options exercised |
|
|
(479 |
) |
|
$ |
1.20 |
|
|
|
|
|
|
|
||
Options expired/forfeited/cancelled |
|
|
(860 |
) |
|
$ |
0.81 |
|
|
|
|
|
|
|
||
Balance at December 31, 2025 |
|
|
23,182 |
|
|
$ |
1.07 |
|
|
|
7.87 |
|
|
$ |
13,898 |
|
Options exercisable at December 31, 2025 |
|
|
10,788 |
|
|
$ |
1.34 |
|
|
|
6.99 |
|
|
$ |
3,566 |
|
Options exercisable and expected to vest |
|
|
23,182 |
|
|
$ |
1.07 |
|
|
|
7.87 |
|
|
$ |
13,898 |
|
|
|
Number |
|
|
Weighted |
|
||
Balance at December 31, 2024 |
|
|
501 |
|
|
$ |
1.24 |
|
RSUs forfeited |
|
|
(100 |
) |
|
$ |
0.21 |
|
RSUs vested |
|
|
(86 |
) |
|
$ |
1.50 |
|
Balance at December 31, 2025 |
|
|
315 |
|
|
$ |
1.50 |
|
A summary of activity of the 2012 Plan, and the 2018 inducement option (which was issued to a Lineage executive outside of all equity plans), is as follows (in thousands, except per share amounts):
|
|
Number |
|
|
Weighted |
|
|
Weighted |
|
|
Aggregate Intrinsic Value |
|
||||
Balance at December 31, 2024 |
|
|
10,068 |
|
|
$ |
1.84 |
|
|
|
4.58 |
|
|
$ |
— |
|
Options exercised |
|
|
(786 |
) |
|
$ |
0.86 |
|
|
|
|
|
|
|
||
Options expired/forfeited/cancelled |
|
|
(1,311 |
) |
|
$ |
2.33 |
|
|
|
|
|
|
|
||
Balance at December 31, 2025 |
|
|
7,971 |
|
|
$ |
1.86 |
|
|
|
4.21 |
|
|
$ |
2,026 |
|
Options exercisable at December 31, 2025 |
|
|
7,971 |
|
|
$ |
1.86 |
|
|
|
4.21 |
|
|
$ |
2,026 |
|
Options exercisable and expected to vest |
|
|
7,971 |
|
|
$ |
1.86 |
|
|
|
4.21 |
|
|
$ |
2,026 |
|
Stock-based Compensation Expense
The fair value of each option award is estimated on the date of grant using a Black-Scholes option pricing model applying the weighted-average assumptions noted in the following table:
|
|
Year Ended December 31, |
|
|||||
|
|
2025 |
|
|
2024 |
|
||
Expected life (in years) |
|
|
6.21 |
|
|
|
6.11 |
|
Risk-free interest rates |
|
|
4.0 |
% |
|
|
4.2 |
% |
Volatility |
|
|
80.3 |
% |
|
|
76.2 |
% |
Dividend yield |
|
|
— |
|
|
|
— |
|
Operating expenses include stock-based compensation expense as follows (in thousands):
|
|
Year Ended December 31, |
|
|||||
|
|
2025 |
|
|
2024 |
|
||
Research and development |
|
$ |
676 |
|
|
$ |
646 |
|
General and administrative |
|
|
4,076 |
|
|
|
4,431 |
|
Total stock-based compensation expense |
|
$ |
4,752 |
|
|
$ |
5,077 |
|
As of December 31, 2025, total unrecognized compensation costs related to unvested stock options and unvested RSUs under all equity plans, were $6.2 million, which is expected to be recognized as expense over a weighted average period of approximately 2.4 years for stock options and 0.5 years for RSUs. For the years ended December 31, 2025 and 2024, the weighted average grant-date fair value per share for options granted during the year under the 2021 Plan was $0.40 and $0.77, respectively. No RSUs were granted in the year ended December 31, 2025 or 2024. The total intrinsic value of options exercised during the years ended December 31, 2025 and 2024 was $800,000 and $135,000, respectively. The fair value of the options vested during the years ended December 31, 2025 and 2024 was $5,270,000 and $4,853,000, respectively.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Mar 5, 2026 | Showing above |
| 2024 | Mar 10, 2025 | |
| 2023 | Mar 7, 2024 | |
| 2022 | Mar 9, 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.