Stock-Based Compensation | Note 12 — Stock-Based Compensation PAVmed Inc. 2014 Long-Term Incentive Equity Plan The PAVmed Inc. 2014 Long-Term Incentive Equity Plan (the “PAVmed 2014 Equity Plan”) is designed to enable PAVmed to offer employees, officers, directors, and consultants, as defined, an opportunity to acquire shares of common stock of PAVmed. The types of awards that may be granted under the PAVmed 2014 Equity Plan include stock options, stock appreciation rights, restricted stock, and other stock-based awards subject to limitations under applicable law. All awards are subject to approval by the PAVmed compensation committee. A total of 21,052,807 1,570,086 600,854 4,700,000 Note 12 — Stock-Based Compensation PAVmed Stock Options PAVmed stock options granted under the PAVmed 2014 Equity Plan and stock options granted outside such plan are summarized as follows: Schedule of Summarizes Information About Stock Options Number of Stock Options Weighted Average Exercise Price Remaining Contractual Term (Years) Intrinsic Value (2) Outstanding stock options at December 31, 2022 11,568,655 $ 2.71 7.4 $ — Granted (1) 7,455,000 $ 0.47 Exercised — $ — Forfeited (1,944,170 ) $ 1.75 Outstanding stock options at September 30, 2023 (3) 17,079,485 $ 1.85 7.5 $ — Vested and exercisable stock options at September 30, 2023 8,379,277 $ 2.89 5.9 $ — (1) Stock options granted under the PAVmed 2014 Equity Plan and those granted outside such plan generally vest one-third in one year then ratably over the next eight quarters, and have a ten-year contractual term from date-of-grant. (2) The intrinsic value is computed as the difference between the quoted price of the PAVmed common stock on each of September 30, 2023 and December 31, 2022 and the exercise price of the underlying PAVmed stock options, to the extent such quoted price is greater than the exercise price. (3) The outstanding stock options presented in the table above, are inclusive of 500,854 Subsequent to September 30, 2023, on November 7, 2023, the company granted to employees 775,000 0.28 vest one-third after one year then ratably over the next eight quarters. PAVmed Restricted Stock Awards PAVmed restricted stock awards granted under the PAVmed 2014 Equity Plan and restricted stock awards granted outside such plan are summarized as follows: Schedule of Restricted Stock Award Activity Number of Restricted Stock Awards Weighted Average Grant Date Fair Value Unvested restricted stock awards as of December 31, 2022 (1) 975,000 $ 3.05 Granted 182,927 0.39 Vested (100,000 ) 3.10 Forfeited — — Unvested restricted stock awards as of September 30, 2023 1,057,927 $ 2.58 (1) The unvested restricted stock awards presented in the table above, are inclusive of 100,000 100,000 Lucid Diagnostics Inc. 2018 Long-Term Incentive Equity Plan The Lucid Diagnostics Inc. 2018 Long-Term Incentive Equity Plan (“Lucid Diagnostics 2018 Equity Plan”) is separate and apart from the PAVmed 2014 Equity Plan discussed above. The Lucid Diagnostics 2018 Equity Plan is designed to enable Lucid Diagnostics to offer employees, officers, directors, and consultants, an opportunity to acquire shares of common stock of Lucid Diagnostics. The types of awards that may be granted under the Lucid Diagnostics 2018 Equity Plan include stock options, stock appreciation rights, restricted stock, and other stock-based awards subject to limitations under applicable law. All awards are subject to approval by the Lucid Diagnostics compensation committee. A total of 11,644,000 3,929,301 423,300 50,000 2,500,000 Note 12 — Stock-Based Compensation Lucid Diagnostics Stock Options Lucid Diagnostics stock options granted under the Lucid Diagnostics 2018 Equity Plan and stock options granted outside such plan are summarized as follows: Schedule of Summarizes Information About Stock Options Number of Stock Options Weighted Average Exercise Price Remaining Contractual Term (Years) Intrinsic Value (2) Outstanding stock options at December 31, 2022 2,565,377 $ 3.14 8.3 $ 428 Granted (1) 2,982,500 $ 1.32 Exercised — $ — Forfeited (590,662 ) $ 2.70 Outstanding stock options at September 30, 2023 (3) 4,957,215 $ 2.10 8.6 $ 347 Vested and exercisable stock options at September 30, 2023 1,439,442 $ 2.77 7.0 $ 347 (1) Stock options granted under the Lucid Diagnostics 2018 Equity Plan and those granted outside such plan generally vest one-third in one year then ratably over the next eight quarters, and have a ten-year contractual term from date-of-grant. (2) The intrinsic value is computed as the difference between the quoted price of the Lucid Diagnostics common stock on each of September 30, 2023 and December 31, 2022 and the exercise price of the underlying Lucid Diagnostics stock options, to the extent such quoted price is greater than the exercise price. (3) The outstanding stock options presented in the table above, are inclusive of 423,300 Subsequent to September 30, 2023, on November 6, 2023, the company granted to employees 500,000 with a weighted average exercise price of $ 1.29 vest one-third after one year then ratably over the next eight quarters. Lucid Diagnostics Restricted Stock Awards Lucid Diagnostics restricted stock awards granted under the Lucid Diagnostics 2018 Equity Plan and restricted stock awards granted outside such plan are summarized as follows: Schedule of Restricted Stock Award Activity Number of Restricted Stock Awards Weighted Average Grant Date Fair Value Unvested restricted stock awards as of December 31, 2022 (1) 2,091,420 $ 11.44 Granted — — Vested (303,980 ) 11.95 Forfeited — — Unvested restricted stock awards as of September 30, 2023 1,787,440 $ 11.36 (1) The unvested restricted stock awards presented in the table above, are inclusive of 50,000 50,000 Subsequent to September 30, 2023, on November 6, 2023, 550,000 vesting one third each year for the next three years with the final vesting date on November 6, 2026 0.7 Consolidated Stock-Based Compensation Expense The consolidated stock-based compensation expense recognized by each of PAVmed and Lucid Diagnostics for both the PAVmed 2014 Equity Plan and the Lucid Diagnostics 2018 Equity Plan, with respect to stock options and restricted stock awards as discussed above, for the periods indicated, was as follows: Schedule of Stock-Based Compensation Expense 2023 2022 2023 2022 Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 Cost of revenue $ 32 $ 9 $ 86 $ 9 Sales and marketing expenses 403 643 1,302 1,859 General and administrative expenses 1,499 3,854 6,761 12,016 Research and development expenses 311 258 1,022 699 Total stock-based compensation expense $ 2,245 $ 4,764 $ 9,171 $ 14,583 Note 12 — Stock-Based Compensation Stock-Based Compensation Expense Recognized by Lucid Diagnostics As noted, the consolidated stock-based compensation expense presented above is inclusive of stock-based compensation expense recognized by Lucid Diagnostics, inclusive of each of: stock options granted under the PAVmed 2014 Equity Plan to the three physician inventors of the intellectual property underlying the CWRU License Agreement (“Physician Inventors”) (as discussed above in Note 4, Related Party Transactions Schedule of Stock-Based Compensation Expense Recognized by Lucid Diagnostics 2023 2022 2023 2022 Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 Lucid Diagnostics 2018 Equity Plan – cost of revenue $ 16 $ 9 $ 44 $ 9 Lucid Diagnostics 2018 Equity Plan – sales and marketing 228 253 697 733 Lucid Diagnostics 2018 Equity Plan – general and administrative 721 2,990 4,069 9,504 Lucid Diagnostics 2018 Equity Plan – research and development 67 28 204 125 PAVmed 2014 Equity Plan - cost of revenue 10 — 26 — PAVmed 2014 Equity Plan - sales and marketing 106 161 359 497 PAVmed 2014 Equity Plan - general and administrative 7 78 170 224 PAVmed 2014 Equity Plan - research and development 97 52 290 159 Total stock-based compensation expense – recognized by Lucid Diagnostics $ 1,252 $ 3,571 $ 5,859 $ 11,251 Total stock-based compensation expense $ 1,252 $ 3,571 $ 5,859 $ 11,251 The consolidated unrecognized stock-based compensation expense and weighted average remaining requisite service period with respect to stock options and restricted stock awards issued under each of the PAVmed 2014 Equity Plan and the Lucid Diagnostics 2018 Equity Plan, as discussed above, is as follows: Schedule of Unrecognized Compensation Expense Unrecognized Expense Weighted Average Remaining Service Period (Years) PAVmed 2014 Equity Plan Stock Options $ 4,736 2.0 Restricted Stock Awards $ 316 1.4 Lucid Diagnostics 2018 Equity Plan Stock Options $ 3,620 2.1 Restricted Stock Awards $ 633 1.0 Stock-based compensation expense recognized with respect to stock options granted under the PAVmed 2014 Equity Plan was based on a weighted average estimated fair value of such stock options of $ 0.35 1.08 Schedule of Fair Values of Stock Options Granted Using Black-scholes Valuation Model Assumptions Nine Months Ended September 30, 2023 2022 Expected term of stock options (in years) 5.7 5.8 Expected stock price volatility 88 % 86 % Risk free interest rate 3.7 % 2.9 % Expected dividend yield — % — % Note 12 — Stock-Based Compensation Stock-based compensation expense recognized with respect to stock options granted under the Lucid Diagnostics 2018 Equity Plan was based on a weighted average estimated fair value of such stock options of $ 0.88 1.61 Schedule of Fair Values of Stock Options Granted Using Black-scholes Valuation Model Assumptions Nine Months Ended September 30, 2023 2022 Expected term of stock options (in years) 5.6 5.8 Expected stock price volatility 75 % 72 % Risk free interest rate 3.7 % 3.2 % Expected dividend yield — % — % PAVmed Inc. Employee Stock Purchase Plan (“PAVmed ESPP”) A total of 573,229 194,240 182 218 304,001 191,698 76 140 188,846 2,000,000 112,913 250,000 Lucid Diagnostics Inc. Employee Stock Purchase Plan (“Lucid ESPP”) A total of 231,987 276 276,213 84,030 275 109 1,000,000 407,770 500,000 |