HeartBeam, Inc. Quarterly report [Sections 13 or 15(d)]

Quarterly report [Sections 13 or 15(d)]

STOCK-BASED COMPENSATION

STOCK-BASED COMPENSATION

9 Months Ended

Sep. 30, 2026

Share-Based Payment Arrangement [Abstract]

STOCK-BASED COMPENSATION

NOTE 6 – STOCK-BASED COMPENSATION

STOCK OPTIONS

The following is a summary of stock option activity during the nine months ended September 30, 2026:


	Number of options outstanding			Weighted average exercise price		Average remaining contractual life (in years)		Aggregate intrinsic value (in thousands)
Outstanding – December 31, 2025		9,119,589		$	2.15		7.85	$	4,305
Options granted		969,663			1.37
Options exercised		(35,000	)		0.31
Options cancelled		(311,754	)		1.51
Outstanding – September 30, 2026		9,742,498		$	2.10		6.34	$	52
Exercisable – September 30, 2026		7,363,404			2.17		5.69		52

The Company estimates the fair values of stock options using the Black-Scholes option-pricing model on the date of grant. For the nine months ended September 30, 2026 and 2025, the assumptions used in the Black-Scholes option pricing model, which was used to estimate the grant date fair value per option, were as follows:


	Nine months ended September 30,
	2026		2025
Weighted-average Black-Scholes option pricing model assumptions:
Volatility	110.11% - 111.87%		111.06% - 121.54%
Expected term (in years)	5.25 - 6.08		5.00 - 6.08
Risk-free rate	3.69% - 4.24%		3.74% - 4.41%
Expected dividend yield		—		—
Weighted average grant date fair value per share	$0.65 - $1.23		$0.98 - $1.99

RESTRICTED STOCK UNITS

On June 15, 2026, the Board approved grants of 651,010 RSU awards to certain employees under the Company's 2022 Equity Incentive Plan in lieu of providing cash bonuses related to the settlement of the 2025 bonus program accrued as of December 31, 2025. The total number of shares subject to the RSU awards are fully vested on the date of issuance. During the period ended September 30, 2026, the Board approved grants of 766,791 RSU awards to Executives under the Company's 2022 Equity Incentive Plan in lieu of providing cash bonuses related to the settlement of the 2025 bonus program.

The following is a summary of RSU awards activity during the nine months ended September 30, 2026:


	Nine months ended September 30, 2026
	Numbers of Shares			Weighted Average Grant Date Fair value
Non-Vested at beginning of period		457,522		$	1.30
Shares granted		1,505,731			0.68
Shares vested		(1,902,770	)		0.81
Shares cancelled		(60,483	)		1.24
Non-vested at the end of period		—		$	—

PERFORMANCE-BASED RESTRICTED STOCK UNITS

On June 15, 2026, the Board approved a performance-based restricted stock unit (“PRSU”) award under the Company’s 2022 Equity Incentive Plan to Branislav Vajdic, the Company’s President, Founder, and Director covering 2,800,000 restricted stock units with fair value of $2.2 million. The PRSUs granted relate to specified operational, software, product-development and clinical study milestones and are eligible to vest only if and to the extent that specified performance-based conditions and service-based conditions are satisfied, or the requirements for accelerated vesting are satisfied. The PRSU award is expensed based on the satisfaction of probability assessment of performance-based conditions and service-based conditions. The Company performs a probability assessment of achievement of each of the performance-based conditions on a quarterly basis and, based on the assessment as of September 30, 2026, all performance conditions related to these awards are expected to be met.

STOCK BASED COMPENSATION

The following is a summary of stock-based compensation expense (rounded):


	Three months ended September 30,				Nine months ended September 30,
	2026		2025		2026		2025
Selling, general and administrative
Stock option expense	$	350,000	$	501,900	$	2,016,000	$	1,092,900
RSU expense		14,000		237,100		359,000		503,600
Total Selling, general and administrative expense		364,000		739,000		2,375,000		1,596,500
Research and development
Stock option expense		392,000		694,300		1,269,000		2,106,800
RSU expense		181,000		—		211,000		16,500
Total research and development expense		573,000		694,300		1,480,000		2,123,300
Total Stock Based Compensation Expense	$	937,000	$	1,433,300	$	3,855,000	$	3,719,800

As of September 30, 2026, total compensation cost not yet recognized related to unvested stock options, unvested RSUs, and unvested PRSUs was approximately $3.6 million, $0, and $1.9 million respectively, which is expected to be recognized over a weighted-average period of 2.06 years, 0, and 2.71 years respectively.