Stock-Based Compensation

9 Months Ended

Sep. 30, 2022

Retirement Benefits [Abstract]

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 Inc. 2014 Equity Plan”) is designed to enable PAVmed Inc. to offer employees, officers, directors, and consultants, as defined, an opportunity to acquire shares of common stock of PAVmed Inc. The types of awards that may be granted under the PAVmed Inc. 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 Inc. board of directors.

A total of 16,352,807 shares of common stock of PAVmed Inc. are reserved for issuance under the PAVmed Inc. 2014 Equity Plan, with 2,520,927 shares available for grant as of September 30, 2022. The share reservation is not diminished by a total of 600,854 PAVmed Inc. stock options and restricted stock awards granted outside the PAVmed Inc. 2014 Equity Plan as of September 30, 2022.

PAVmed Inc. Stock Options

PAVmed Inc. stock options granted under the PAVmed Inc. 2014 Equity Plan and stock options granted outside such plan are summarized as follows:

	Number of Stock Options			Weighted Average Exercise Price		Remaining Contractual Term (Years)		Intrinsic Value(2)
Outstanding stock options at December 31, 2021		8,720,198		$	3.39		6.8	$	3,516
Granted(1)		4,734,350		$	1.54
Exercised		(299,999	)	$	1.01
Forfeited		(1,542,978	)	$	3.13
Outstanding stock options at September 30, 2022(3)		11,611,571		$	2.73		7.7	$	—
Vested and exercisable stock options at September 30, 2022		6,623,157		$	3.01		6.5	$	—

(1)	Stock options granted under the PAVmed Inc. 2014 Equity Plan and those granted outside such plan generally vest ratably over twelve quarters, with the vesting commencing with the grant date quarter-end, 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 Inc. common stock on each of September 30, 2022 and December 31, 2021 and the exercise price of the underlying PAVmed Inc. 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 stock options granted outside the PAVmed Inc. 2014 Equity Plan, as of September 30, 2022 and December 31, 2021.

Note 12 — Stock-Based Compensation - continued

PAVmed Inc. Restricted Stock Awards

PAVmed Inc. restricted stock awards granted under the PAVmed Inc. 2014 Equity Plan and restricted stock awards granted outside such plan are summarized as follows:

	Number of Restricted Stock Awards			Weighted Average Grant Date Fair Value
Unvested restricted stock awards as of December 31, 2021		1,666,666		$	2.36
Granted		—			—
Vested		(541,666	)		1.20
Forfeited		(150,000	)		2.04
Unvested restricted stock awards as of September 30, 2022(1)		975,000		$	3.05

⁽¹⁾ The unvested restricted stock awards presented in the table above, are inclusive of 100,000 restricted stock awards granted outside the PAVmed Inc. 2014 Equity Plan as of September 30, 2022 and December 31, 2021.

Lucid Diagnostics Inc. 2018 Long-Term Incentive Equity Plan

The Lucid Diagnostics Inc. 2018 Long-Term Incentive Equity Plan (“Lucid Diagnostics Inc. 2018 Equity Plan”) is separate and apart from the PAVmed Inc. 2014 Equity Plan discussed above. The Lucid Diagnostics Inc. 2018 Equity Plan is designed to enable Lucid Diagnostics Inc. to offer employees, officers, directors, and consultants, as defined, an opportunity to acquire shares of common stock of Lucid Diagnostics Inc. The types of awards that may be granted under the Lucid Diagnostics Inc. 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 Inc. board of directors.

A total of 9,144,000 shares of common stock of Lucid Diagnostics Inc. are reserved for issuance under the Lucid Diagnostics Inc. 2018 Equity Plan, with 3,754,051 shares available for grant as of September 30, 2022. The share reservation is not diminished by a total of 423,300 stock options and 50,000 restricted stock awards granted outside the Lucid Diagnostics Inc. 2018 Equity Plan, as of September 30, 2022.

Lucid Diagnostics Inc. Stock Options

Lucid Diagnostics Inc. stock options granted under the Lucid Diagnostics Inc. 2018 Equity Plan and stock options granted outside such plan are summarized as follows:

	Number of Stock Options			Weighted Average Exercise Price		Remaining Contractual Term (Years)		Intrinsic Value(2)
Outstanding stock options at December 31, 2021		1,419,242		$	0.73		7.0	$	6,665
Granted(1)		2,320,000		$	3.71
Exercised		(964,717	)	$	0.72
Forfeited		(141,436	)	$	4.33
Outstanding stock options at September 30, 2022(3)		2,633,089		$	3.17		8.6	$	499
Vested and exercisable stock options at September 30, 2022		960,364		$	2.33		7.2	$	499

(1)	Stock options granted under the Lucid Diagnostics Inc. 2018 Equity Plan and those granted outside such plan generally vest ratably over twelve quarters, with the vesting commencing with the grant date quarter-end, 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 Inc. common stock on each of September 30, 2022 and December 31, 2021 and the exercise price of the underlying Lucid Diagnostics Inc. 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 stock options granted outside the Lucid Diagnostics Inc. 2018 Equity Plan, as of September 30, 2022 and December 31, 2021.

Note 12 — Stock-Based Compensation - continued

Lucid Diagnostics Inc. Restricted Stock Awards

Lucid Diagnostics Inc. restricted stock awards granted under the Lucid Diagnostics Inc. 2018 Equity Plan and restricted stock awards granted outside such plan are summarized as follows:

	Number of Restricted Stock Awards			Weighted Average Grant Date Fair Value
Unvested restricted stock awards as of December 31, 2021		1,940,740		$	12.76
Granted		320,000			4.53
Vested		(169,320	)		13.48
Forfeited		—			—
Unvested restricted stock awards as of September 30, 2022(1)		2,091,420		$	11.44

⁽¹⁾ The unvested restricted stock awards presented in the table above, are inclusive of 50,000 restricted stock awards granted outside the Lucid Diagnostics Inc. 2018 Equity Plan as of September 30, 2022 and December 31, 2021.

On January 7, 2022, 320,000 restricted stock awards were granted under the Lucid Diagnostics Inc 2018 Equity Plan, with such restricted stock awards having a single vesting date on January 7, 2025, and an aggregate grant date fair value of approximately $1.4 million, measured as the grant date closing price of Lucid Diagnostics Inc. common stock, with such aggregate estimated fair value recognized as stock-based compensation expense ratably on a straight-line basis over the vesting period, which is commensurate with the service period. The restricted stock awards are subject to forfeiture if the requisite service period is not completed.

Consolidated Stock-Based Compensation Expense

The consolidated stock-based compensation expense recognized by each of PAVmed Inc. and Lucid Diagnostics Inc. for both the PAVmed Inc. 2014 Equity Plan and the Lucid Diagnostics Inc. 2018 Equity Plan, with respect to stock options and restricted stock awards as discussed above, for the periods indicated, was as follows:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
Cost of revenue	$	9	$	—	$	9	$	—
Sales and marketing expenses		643		327		1,859		814
General and administrative expenses		3,854		3,353		12,016		9,088
Research and development expenses		258		310		699		727
Total stock-based compensation expense	$	4,764	$	3,990	$	14,583	$	10,629

Note 12 — Stock-Based Compensation - continued

Stock-Based Compensation Expense Recognized by Lucid Diagnostics Inc.

As noted, the consolidated stock-based compensation expense presented above is inclusive of stock-based compensation expense recognized by Lucid Diagnostics Inc., inclusive of each of: stock options granted under the PAVmed Inc. 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); and stock options and restricted stock awards granted to employees of PAVmed Inc. and non-employee consultants under the Lucid Diagnostics Inc. 2018 Equity Plan. The stock-based compensation expense recognized by Lucid Diagnostics Inc. for both the PAVmed Inc. 2014 Equity Plan and the Lucid Diagnostics Inc. 2018 Equity Plan, with respect to stock options and restricted stock awards as discussed above, for the periods indicated, was as follows:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
Lucid Diagnostics Inc 2018 Equity Plan – cost of revenue	$	9	$	—	$	9	$	—
Lucid Diagnostics Inc 2018 Equity Plan – sales and marketing expenses		253		—		733		—
Lucid Diagnostics Inc 2018 Equity Plan – general and administrative expenses		2,990		2,695		9,504		5,988
Lucid Diagnostics Inc 2018 Equity Plan – research and development expenses		28		21		125		57
PAVmed Inc 2014 Equity Plan - sales and marketing expenses		161		—		497		—
PAVmed Inc 2014 Equity Plan - general and administrative expenses		78		—		224		—
PAVmed Inc 2014 Equity Plan - research and development expenses		52		56		159		111
Total stock-based compensation expense – recognized by Lucid Diagnostics Inc	$	3,571	$	2,772	$	11,251	$	6,156

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 Inc. 2014 Equity Plan and the Lucid Diagnostics Inc. 2018 Equity Plan, as discussed above, is as follows:

	Unrecognized Expense		Weighted Average Remaining Service Period (Years)
PAVmed Inc. 2014 Equity Plan
Stock Options	$	8,424		2.1
Restricted Stock Awards	$	1,222		0.9
Lucid Diagnostics Inc. 2018 Equity Plan
Stock Options	$	3,791		2.4
Restricted Stock Awards	$	7,165		0.8

Note 12 — Stock-Based Compensation - continued

Stock-based compensation expense recognized with respect to stock options granted under the PAVmed Inc. 2014 Equity Plan was based on a weighted average estimated fair value of such stock options of $1.08 per share and $3.47 per share during the periods ended September 30, 2022 and 2021, respectively, calculated using the following weighted average Black-Scholes valuation model assumptions:

	Nine Months Ended September 30,
	2022			2021
Expected term of stock options (in years)		5.8			5.6
Expected stock price volatility		86.0	%		76.0	%
Risk free interest rate		2.9	%		0.9	%
Expected dividend yield		—	%		—	%

Stock-based compensation expense recognized with respect to stock options granted under the Lucid Diagnostics Inc. 2018 Equity Plan was based on a weighted average estimated fair value of such stock options of $1.61 per share during the period ended September 30, 2022. The stock-based compensation was calculated using the following weighted average Black-Scholes valuation model assumptions:

	Nine Months Ended September 30,
	2022
Expected term of stock options (in years)		5.8
Expected stock price volatility		72.0	%
Risk free interest rate		3.2	%
Expected dividend yield		—	%

PAVmed Inc. Employee Stock Purchase Plan (“ESPP”)

A total of 194,240 shares and 203,480 shares of common stock of the Company were purchased for proceeds of approximately $218 and $304, on March 31, 2022 and 2021, respectively under the PAVmed Inc Employee Stock Purchase Plan (“PAVmed Inc ESPP”). A total of 191,698 shares and 31,112 shares of common stock of the Company were purchased for proceeds of approximately $140 and $131, on September 30, 2022 and 2021, respectively under the PAVmed Inc ESPP. The September 30, 2022 purchase was settled through the redeployment of treasury stock, and did not reduce the number of shares available-for-issue under the PAVmed Inc ESPP. The PAVmed Inc. ESPP has a total reservation of 1,750,000 shares of common stock of PAVmed Inc. of which 931,841 shares are available-for-issue as of September 30, 2022.

Lucid Diagnostics, Inc Employee Stock Purchase Plan (“ESPP”)

The Lucid Diagnostics Inc Employee Stock Purchase Plan (“Lucid Diagnostics Inc ESPP”), initial six-month stock purchase period was April 1, 2022 to September 30, 2022. A total of 84,030 shares of common stock of Lucid Diagnostics Inc were purchased for proceeds of approximately $109 on September 30, 2022 under the Lucid Diagnostics Inc. ESPP. The Lucid Diagnostics Inc. ESPP has a total reservation of 500,000 shares of common stock of Lucid Diagnostics Inc. of which 415,970 shares are available-for-issue as of September 30, 2022.