USBC, Inc. Stock Compensation Disclosure

10. EQUITY INCENTIVE PLANS

On August 12, 2021, the Company established the 2021 Equity Incentive Plan, which was adopted by the Company’s shareholders on October 15, 2021. The 2021 Plan was approved for 20,000,000 shares of the Company’s common stock. Common stock reserved under the 2021 Plan increased to 22,000,000 shares on January 1, 2022. On October 25, 2024, shareholders approved a Plan Amendment which increased the maximum number of shares of our common stock that may be delivered to participants under the 2021 Plan to 40,000,000. Effective January 1, 2025, pursuant to the evergreen provisions of the 2021 Plan, the maximum number of shares of Common Stock authorized under the Plan was increased by 50,000 Shares to 1,050,000. On August 5, 2025, shareholders approved a Plan Amendment which increased the maximum number of shares of common stock that may be delivered to participants under the 2021 Plan to 50,000,000 shares. 

Amended and Restated 2021 Equity Incentive Plan

On August 25, 2025, our Board of Directors approved, and on September 29, 2025, our stockholders adopted the Amended and Restated USBC, Inc. 2021 Equity Incentive Plan (the “2021 Plan”), effective September 29, 2025, which increased the plan share reserve by 65,000,000 shares. The 2021 Plan was previously amended effective July 31, 2025 to increase the plan share reserve to a total of 50,000,000 shares.

Under the 2021 Plan, all 115.3 million shares of common stock available under the Plan Share Reserve, as well as future shares added through the evergreen feature, are eligible for grants as “incentive stock options” intended to qualify for special tax treatment under Section 422 of the Internal Revenue Code of 1986, as amended.

The 2021 Plan contains an evergreen provision pursuant to which, on January 1 of each calendar year during the term specified in the 2021 Plan, the number of shares available for issuance under the 2021 Plan automatically increases by a number of shares equal to the lesser of (i) 15,000,000 shares, (ii) 4% of the outstanding shares of the Company’s common stock on the last day of the immediately preceding fiscal year and (iii) such lesser number of shares as determined by the Board, in each case subject to adjustment for any stock split, reverse stock split, stock dividend or similar change in capitalization.

Stock Option Activity

Transition Period

During the Transition Period, the Company issued stock option grants for 62,530,000 shares of common stock at a weighted average price of $1.07 per share and unvested stock option grants for 15,013,750 shares with an exercise price of $1.10 per share were forfeited. These options generally vest quarterly over three years beginning on the one-year anniversary of the grant date, with certain grants vesting earlier in accordance with the applicable award agreements. The options have contractual terms of ten years from the date of grant.

During the Transition Period, the Company repriced 48,620,000 stock options from an original exercise price of $2.45 per share to $1.10 per share, representing the closing market price of the Company’s common stock on the date of approval. The Company recognized incremental stock-based compensation expense of $1,217,564 related to the repricing during the Transition Period, in accordance with ASC 718.

Fiscal Year Ended September 30, 2025

During the fiscal year ended September 30, 2025, the Company issued stock option grants for 48,628,250 shares at a weighted average price of $2.45 per share. These options generally vest quarterly over three years beginning on the one-year anniversary of the grant date, with certain awards vesting earlier in accordance with the applicable award agreements.

A summary of the stock options outstanding as of December 31, 2025 were as follows:

The following table summarizes information about stock options outstanding and exercisable as of December 31, 2025:

The significant weighted average assumptions relating to the valuation of the Company’s stock option grants issued and repriced during the Transition Period were as follows:

Stock Option Outstanding and Exercisable

As of December 31, 2025, stock option grants of 96,150,750 shares of common stock were outstanding under the 2021 plan, with a weighted average exercise price of $1.08 per share. The Company recognized stock-based compensation expense related to stock options of $11,868,452 for the Transition Period ended December 31, 2025 and $7,407,088 for the year ended September 30, 2025. As of December 31, 2025, there was $94,145,942 of total unrecognized compensation cost related to unvested stock options, which is expected to be recognized over a weighted-average remaining vesting period of 3.61 years. Stock-based compensation expense is included within selling, general and administrative expenses in the Company’s consolidated Statements of Operations.