In October 2017, the Company adopted and approved the 2017 Stock Plan (the “2017 Plan”) under which 3.1 million shares of the Company’s common stock were originally reserved for issuance to employees, directors, and consultants. Since its inception, the Company has periodically amended the 2017 Plan to increase the number of reserved shares. In 2023, the Company twice amended the 2017 Plan to increase the number of reserved shares to a total of approximately 26.7 million. In 2024, the Company twice amended the 2017 Plan to increase the number of reserved shares by an additional total 11.3 million shares for a total of approximately 38.1 million. Under the 2017 Plan, the Company may grant stock options, restricted stock awards ("RSAs”), and RSUs. Options granted under the Plan may be either incentive stock options (“ISOs”) or stock options (“NSOs”). ISOs may be granted only to Company employees (including officers and directors). Awards granted under the 2017 Plan generally vest based on service over various periods ranging from immediately to five years. Certain performance-based awards vest upon the occurrence of a qualified liquidity event (including a change in control or IPO), while some awards may accelerate vesting upon such an event. Options expire as determined by the Board of Directors but not more than ten years after the date of grant, unless the holder of an ISO owns more than 10% of the voting power in the Company, in which case the term cannot exceed five years. The Company had no shares of common stock available for issuance under the 2017 Plan, as of March 31, 2026.

In 2024, the Company established a Performance-Based Incentive Compensation Plan (the “2024 Plan”) that allows for the issuance of stock options, RSAs, RSUs, and cash incentives to employees, directors, and consultants. The stock based awards granted under the 2024 Plan are governed in accordance with the 2017 Plan. The 2024 Plan also includes cash incentive opportunities tied to the achievement of specific performance goals. Subsequent to its adoption, all equity-based awards were issued under the 2024 Plan, and no further awards were granted under the 2017 Plan.

In July 2025, the Board of Directors adopted, and the Company's stockholders approved, the Firefly Aerospace Inc. 2025 Omnibus Incentive Plan (the “2025 Plan”). The 2025 Plan authorizes grants of stock options, stock appreciation rights, RSAs, RSUs, performance awards, other stock‑based awards, cash awards, and substitute awards. The 2025 Plan reserves 24.1 million shares of common stock, subject to annual increases beginning January 1, 2026 equal to the lesser of (i) 3% of shares outstanding or (ii) a smaller amount determined by the Board of Directors. RSUs and restricted stock granted under the 2025 Plan vest based on service, performance conditions, or both, and unvested units are typically forfeited upon termination.

Compensation cost for employee stock-based awards is based on the estimated grant date fair value and is recognized over the vesting period of the applicable award on a straight-line basis for service-based awards with graded vesting.

In August 2025, the Board of Directors adopted, and the Company's shareholders approved, the 2025 Employee Stock Purchase Plan (the “ESPP”). The ESPP authorizes the issuance of shares of common stock pursuant to purchase rights granted to the Company's employees. The option purchase price will be designated by the ESPP administrator but will not be less than 85% of the fair market value of a share of the Company's common stock on the applicable enrollment date or the applicable exercise date, whichever is lower. A total of 3.2 million shares of the Company's common stock was initially reserved for issuance under the ESPP. In addition, the number of shares available for issuance under the ESPP will be increased annually on January 1 of each fiscal year beginning in 2026 by an amount equal to the lesser of (i) 1.0% of the shares outstanding on the last day of the immediately preceding fiscal year or (ii) a lesser amount determined by the Company's Board of Directors; provided, however, that no more than 3.2 million shares may be issued per year in total under the ESPP.

Subsequent to the IPO, the Company grants service-based RSUs to employees, all of which relate to the Company's common stock, under the 2025 Plan. RSUs generally expire four years from grant date. The service-based vesting condition for these awards is generally satisfied by rendering continuous service, generally for one to four years, during which time the grants will vest either with a cliff vesting period of one year and continued vesting quarterly thereafter or quarterly from the vesting commencement date. The fair value of RSUs is based on the closing market price of the Company’s common stock on the grant date. The Company records stock-based compensation expense related to RSUs on a straight-line basis over the requisite service period.

During the three months ended March 31, 2026, the Company granted RSUs to certain employees under the 2025 Plan. Each RSU represents the right to receive one share of the Company’s common stock upon vesting. The RSUs granted generally vest over the requisite service period specified in each award agreement. Unvested RSUs are forfeited upon termination of employment, unless otherwise provided under the award terms.

A summary of the Company's RSU activity for the three months ended March 31, 2026 is presented below:


	RSUs			Weighted-Average Grant Date Fair Value
Unvested as of December 31, 2025		3,889		$	38.94
Granted		402			24.34
Vested		(13	)		45.00
Canceled / forfeited		(116	)		30.24
Unvested as of March 31, 2026		4,162		$	37.77

The total fair value of RSUs vested during the three months ended March 31, 2026 was $0.3 million. Total unrecognized compensation cost related to unvested RSUs was $136.4 million, which is expected to be recognized over a weighted‑average period of 3.3 years.

The following table summarizes the stock option activity during the three months ended March 31, 2026:


	Number of Options Outstanding			Weighted-Average Exercise Price		Weighted-Average Remaining Contractual Term
Balance, December 31, 2025		15,365		$	1.31		7.44
Options granted		—			—		—
Options exercised		(791	)		1.30		—
Options canceled		(165	)		1.42		—
Balance, March 31 , 2026		14,409		$	1.32		7.09
Vested and exercisable		12,665		$	1.31		6.96
Unvested		1,744		$	1.36		8.03

The Company did not grant any employee stock options for the three months ended March 31, 2026. The weighted-average grant date fair value of employee stock options granted was $0.22 per share during the three months ended March 31, 2025. Unrecognized compensation expense related to stock options, which are expected to be recognized over a weighted-average period of 1.89 years and 3.2 years, was $1.7 million and $3.0 million as of March 31, 2026 and 2025, respectively. The aggregate intrinsic value of the options outstanding was $388.9 million and $0.6 million for the years ended March 31, 2026 and 2025, respectively. The aggregate intrinsic value of the options exercisable was $341.7 million and $0.3 million for the years ended March 31, 2026 and 2025, respectively. The Company received cash proceeds of $0.5 million and $0.4 million from the exercise of stock options during the years ended March 31, 2026, and 2025, respectively.

The Company uses the Black-Scholes option pricing model to determine the fair value of stock options. The determination of the fair value of stock options on the date of grant is affected by the stock price as well as assumptions regarding several complex and subjective variables. These variables include expected stock price volatility over the term of the awards, actual and projected employee stock option exercise behaviors, risk-free interest rates, and expected dividends.

The expected term represents the period that the stock-based awards are expected to be outstanding. The option grants qualify to be “plain vanilla”, and the Company used the simplified method to determine the expected term. The simplified method calculates the expected term as the average of the time-to-vesting and contractual life of the option.

Since the Company has limited historical data regarding the volatility of its common stock, the expected volatility used is based on volatility of similar entities, referred to as “guideline” companies. In evaluating similarity, the Company considered factors such as industry, stage of life cycle and size.

The risk-free rate is based on U.S. Treasury issues with remaining terms similar to the expected term on the options.

The Company has never declared or paid any cash dividends and does not plan to pay cash dividends in the foreseeable future, and, therefore, used an expected dividend yield of zero in the valuation model.

Total stock-based compensation expense related to options and RSUs was allocated to research and development and general and administrative expense as follows:


	For the Three Months Ended March 31,
	2026		2025
Research and development	$	5,705	$	118
Selling, general and administrative		6,807		313
	$	12,512	$	431