Rimini Street, Inc.RMNI
Rimini Street, Inc. Stock Compensation Disclosure
STOCK-BASED COMPENSATION AND WARRANTS
Overview of Equity Incentive Plans
In October 2013, the Company established the 2013 Equity Incentive Plan, as amended and restated in July 2017 (the “2013 Plan”) that provides for grants of stock options, stock appreciation rights, restricted stock, restricted stock units ("RSUs"), performance units (“PSUs”). As of December 31, 2025, the Company had stock options of approximately 9.4 million shares, RSUs of approximately 3.9 million shares and PSUs of 1.0 million shares outstanding under the 2013 Plan. As of December 31, 2025, there are approximately 7.7 million shares available for future grants. The 2013 Plan will expire on July 31, 2027.
The 2013 Plan provides for stock options to be granted to employees and directors at an exercise price not less than 100% of the fair value at the grant date. The options granted generally have a maximum term of 10 years from grant date and are exercisable upon vesting. Option granted to employees generally vest as to one-third of the shares subject to the award on each anniversary of the designated vesting commencement date, which may precede the grant date of such award. Options granted to directors generally vest for all of the shares one year after the grant date.
On the first day of each fiscal year beginning in 2018, the 2013 Plan provides that the number of authorized shares available for issuance will increase in an amount equal to the lesser of (i) 4.8 million shares, (ii) 4% of the outstanding shares of all classes of the Company’s Common Stock as of the last day of the immediately preceding fiscal year; or (iii) such other amount as the Company’s Board of Directors may determine. The Board of Directors approved an increase in the authorized shares of 3.7 million shares on February 12, 2026.
Stock Options
The following table sets forth the summary of stock option activity under the Company’s Stock Plans for the years ended December 31, 2025, 2024 and 2023, (shares in thousands):
| 2025 | 2024 | 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Shares | Price (1) | Term (2) | Shares | Price (1) | Term (2) | Shares | Price (1) | Term (2) | |||||||||||||||||||||||||||||||||||||||||||||
| Outstanding, beginning of year | 9,563 | $ | 4.68 | 7,800 | $ | 5.77 | 6,994 | $ | 6.17 | ||||||||||||||||||||||||||||||||||||||||||||
| Granted | 1,303 | 3.69 | 3,462 | 2.66 | 2,043 | 4.13 | |||||||||||||||||||||||||||||||||||||||||||||||
| Forfeited | (452) | 3.19 | (396) | 4.68 | (336) | 5.84 | |||||||||||||||||||||||||||||||||||||||||||||||
| Expired | (970) | 5.62 | (1,303) | 5.81 | (844) | 5.44 | |||||||||||||||||||||||||||||||||||||||||||||||
| Exercised | (24) | 2.67 | — | — | (57) | 1.38 | |||||||||||||||||||||||||||||||||||||||||||||||
| Outstanding, end of year (3)(4) | 9,420 | 4.52 | 6.6 | 9,563 | 4.68 | 6.9 | 7,800 | 5.77 | 5.9 | ||||||||||||||||||||||||||||||||||||||||||||
| Vested, end of year (3) | 5,654 | 5.43 | 5.3 | 4,772 | 6.22 | 4.6 | 4,744 | 6.36 | 4.1 | ||||||||||||||||||||||||||||||||||||||||||||
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(1)Represents the weighted average exercise price.
(2)Represents the weighted average remaining contractual term until the stock options expire.
(3)As of December 31, 2025, 2024 and 2023, the aggregate intrinsic value of stock options outstanding was $4.4 million, $0.2 million, and $0.1 million, respectively. As of December 31, 2025, 2024 and 2023, the aggregate intrinsic value of vested stock options was $1.5 million, $2 thousand and $5 thousand, respectively.
(4)The number of outstanding stock options that are not expected to ultimately vest due to forfeiture amounted to 0.4 million shares as of December 31, 2025.
The following table presents the total number of shares available for grant under the 2013 Plan for the years ended December 31, 2025, 2024 and 2023 (in thousands):
| 2025 | 2024 | 2023 | |||||||||||||||
| Available, beginning of year | 5,131 | 8,233 | 7,543 | ||||||||||||||
| Stock options granted | (1,303) | (3,462) | (2,043) | ||||||||||||||
| RSUs and PSUs granted | (2,012) | (5,372) | (2,113) | ||||||||||||||
| Expired options under Stock Plans | 970 | 1,303 | 844 | ||||||||||||||
| Forfeited options under Stock Plans | 452 | 396 | 336 | ||||||||||||||
| Forfeited RSUs and PSUs under Stock Plans | 846 | 449 | 200 | ||||||||||||||
| Shares issued | — | — | (75) | ||||||||||||||
| Newly authorized by Board of Directors | 3,645 | 3,584 | 3,541 | ||||||||||||||
| Available, end of year | 7,729 | 5,131 | 8,233 | ||||||||||||||
Fair Value of Stock Options
The fair value of each stock option grant under the Stock Plans was estimated on the date of grant using the BSM option-pricing model, with the following weighted-average assumptions for the years ended December 31, 2025, 2024 and 2023:
| 2025 | 2024 | 2023 | |||||||||||||||
| Expected life (in years) | 6.0 | 6.0 | 6.0 | ||||||||||||||
| Volatility | 66 | % | 65 | % | 56 | % | |||||||||||
| Dividend yield | — | % | — | % | — | % | |||||||||||
| Risk-free interest rate | 4.0 | % | 4.3 | % | 3.8 | % | |||||||||||
The BSM model requires various highly subjective assumptions that represent management’s best estimates of the fair value of the Company’s Common Stock, volatility, risk-free interest rates, expected term, and dividend yield. The Common Stock option value is based on the Company’s closing market price on the date of grant.
The expected term represents the weighted-average period that options granted are expected to be outstanding giving consideration to vesting schedules. Since the Company does not have an extended history of actual exercises, the Company has estimated the expected term using a simplified method which calculates the expected term as the average of the time-to-vesting and the contractual life of the awards. The Company has never declared or paid cash dividends on Common Stock and does not plan to pay cash dividends in the foreseeable future; therefore, the Company used an expected dividend yield of zero. The risk-free interest rate is based on U.S. Treasury rates in effect during the expected term of the grant. The expected volatility is based on historical volatility of publicly-traded peer companies.
The weighted-average grant date fair value per share of employee options granted for the years ended December 31, 2025, 2024 and 2023 was $2.33, $1.66 and $2.30, respectively.
As of December 31, 2025, 2024 and 2023, total unrecognized compensation cost, net of forfeitures, related to unvested stock options was $4.9 million, $5.7 million and $4.6 million, respectively. The remaining unrecognized costs are expected to be recognized on a straight-line basis over a weighted-average period of approximately 1.73 years.
Restricted Stock Units
For the year ended December 31, 2025, the Board of Directors granted RSUs under the 2013 Plan for an aggregate of approximately 1.4 million shares of Common Stock to non-employee members of the Board of Directors, officers and employees of the Company. These RSUs vest over periods ranging from 12 to 36 months from the respective grant dates and the awards are subject to forfeiture upon termination of employment or service on the Board of Directors. Based on the weighted average fair market value of the Common Stock of $3.64 per share on the date of grant, the aggregate fair value for the shares underlying the RSUs amounted to $5.1 million as of the grant date that is being recognized as compensation cost over the vesting period. Accordingly, compensation expense of $6.1 million, $5.1 million and $7.4 million was recognized for the years ended December 31, 2025, 2024 and 2023, respectively. The unrecognized expense of $7.9 million, net of forfeitures, is expected to be charged to expense on a straight-line basis as the RSUs vest over a weighted-average period of approximately 1.67 years.
Performance Stock Units
Under the 2025 LTI Plan, the Company granted 0.6 million PSUs on March 4, 2025, with a fair market value of $3.48. PSUs were measured over a performance period beginning on January 1, 2025 and ending on December 31, 2025 (the “Performance Period”), but will remain subject to a continued service-based vesting requirement. Half of the PSUs awarded are eligible to vest based on the Company’s achievement against a target adjusted EBITDA goal for fiscal year 2025, and the remaining half of the PSUs awarded will be eligible to vest based on the Company’s achievement against a target total revenue goal for fiscal year 2025. The ultimate number of PSUs that may vest (as calculated, the “Earned PSUs”) range from zero to 200% of the granted PSUs.
Under the 2024 Long-Term Incentive Plan, the Company granted 0.8 million PSUs on May 6, 2024, with a fair market value of $2.47 at the time of grant. The Earned PSUs under the May 6, 2024 grant were earned at 28%. Under the terms of the 2024 LTI Plan, the Earned PSUs will vest in equal annual installments on the first, second and third anniversaries of the Date of Grant, generally subject to the awardee continuing to be a Service Provider through the applicable vesting date.
Under the 2023 Long-Term Incentive Plan, the Company granted 0.6 million PSUs on April 3, 2023, with a fair market value of $3.93 at the time of the grant. The Earned PSUs under the April 3, 2023 grant were earned at 151% which resulted in an additional 0.3 million PSUs being earned. Under the terms of the 2023 LTI Plan, the Earned PSUs vest in equal annual installments on the first, second and third anniversaries of the Date of Grant, generally subject to the awardee continuing to be a Service Provider through the applicable vesting date.
The Company recognized compensation expense related to PSUs of $1.2 million, $1.5 million and $1.5 million for the years ended December 31, 2025, 2024 and 2023, respectively. As of December 31, 2025, the unrecognized expense of $0.7 million,
net of forfeitures, is expected to be charged to expense on a graded basis as the PSUs vest over a weighted-average period of approximately 1.52 years.
Stock-Based Compensation Expense
The aggregate stock-based compensation expense for stock options, RSUs and PSUs for the years ended December 31, 2025, 2024 and 2023 is classified as follows (in thousands):
| 2025 | 2024 | 2023 | |||||||||||||||
| Cost of revenues | $ | 2,057 | $ | 1,756 | $ | 1,972 | |||||||||||
| Sales and marketing | 3,989 | 2,208 | 2,844 | ||||||||||||||
| General and administrative | 5,025 | 5,581 | 7,706 | ||||||||||||||
| Total | $ | 11,071 | $ | 9,545 | $ | 12,522 | |||||||||||
Employee Stock Purchase Plan
At the Annual Meeting of Stockholders held on June 7, 2018, the Company’s stockholders approved the Rimini Street, Inc. 2018 Employee Stock Purchase Plan (the “ESPP”). The ESPP provides for the purchase by employees of up to an aggregate of 5.0 million shares of Common Stock. The purchase price per share at which shares are sold in an offering period under the ESPP will be equal to the lesser of 85% of the fair market value of the shares (i) on the first trading day of the offering period, or (ii) on the purchase date (i.e., the last trading day of the offering period). Offering periods will consist of two six-month periods generally commencing twice each calendar year. The purpose of the ESPP is to provide an opportunity for eligible employees of the Company to purchase shares of the Company at a discount through voluntary contributions from such employees’ eligible pay, thereby attracting, retaining and rewarding such persons and strengthening the mutuality of interest between such employees and the Company’s stockholders. Through December 31, 2025, no offering period under the ESPP had commenced and no shares of Common Stock have been issued under the ESPP. As of the date of this Report, there are no plans to commence offering periods under the ESPP.
Outstanding Warrants
As of December 31, 2025, warrants were outstanding for an aggregate of 3.4 million shares of Common Stock and were exercisable at $5.64 per share. The Company’s remaining outstanding warrants are currently exercisable. The exercise price and number of shares issuable upon exercise of the warrants may be adjusted in certain circumstances including in the event of a stock dividend, recapitalization, reorganization, merger or consolidation. A summary of the terms of outstanding warrants and the number of shares of Common Stock issuable upon exercise, is presented below as of December 31, 2025 and 2024 (in thousands, except per share amounts):
| Issuance Date | Expiration Date | Exercise Price | Number of Shares | ||||||||||||||||||||||||||||||||
| Description | 2025 | 2024 | |||||||||||||||||||||||||||||||||
| Warrants | October 2017 | June 2026 | (1) | $ | 5.64 | 3,440 | 3,440 | (2) | |||||||||||||||||||||||||||
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(1)The expiration date for the Warrants is the earlier to occur of the stated expiration date or the date when the Company experiences a change of control.
(2)The Warrants were issued upon consummation of the merger discussed in Note 1.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.