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Stock-Based Compensation | 6 Months Ended
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Jun. 30, 2026
Share-Based Payment Arrangement [Abstract] |
Stock-Based Compensation | Stock-Based Compensation Stock-based compensation expense for stock options, RSUs and PSUs is reflected in the condensed consolidated statements of operations and comprehensive loss as follows (in thousands):
| Three months ended June 30, | Six months ended June 30,
| 2026 |  | 2025 | 2026 |  | 2025
General and administrative | $ | 1,265 |  |  | $ | 1,104 |  | $ | 3,534 |  |  | $ | 2,203 |
Research and development | 568 |  |  | 741 |  | 1,697 |  |  | 1,527 |
Total | $ | 1,833 |  | $ | 1,845 |  | $ | 5,231 |  |  | $ | 3,730 |
As of June 30, 2026, the Company had $17.0 million of unrecognized stock-based compensation expense related to stock options, RSUs and PSUs outstanding, which is expected to be recognized over a weighted-average period of 2.2 years. Equity Plans The Company maintains two equity compensation plans, the 2014 Ocugen OpCo, Inc. Stock Option Plan (the "2014 Plan") and the Ocugen, Inc. 2019 Equity Incentive Plan (the "2019 Plan", collectively with the 2014 Plan, as amended, the "Plans"). On the first business day of each fiscal year, pursuant to the "Evergreen" provision of the 2019 Plan, the aggregate number of shares that may be issued under the 2019 Plan will automatically increase by a number equal to the lesser of 4% of the total number of shares of the Company's common stock outstanding on December 31st of the prior year, or a number of shares determined by the Board of Directors. As of June 30, 2026, the 2019 Plan authorizes the granting of up to a total of 62.8 million equity awards in respect to the Company's common stock. The 2019 Plan had 12.1 million equity awards remaining available for future grant as of June 30, 2026. In addition to stock options, PSUs and RSUs granted under the Plans, the Company has granted certain stock options and RSUs as material inducements to employment in accordance with Nasdaq Listing Rule 5635 (c)(4), which were granted outside of the Plans. Stock Options to Purchase Common Stock The following table summarizes the Company's stock option activity:
| Number of Shares |  | Weighted Average Exercise Price |  | Weighted Average Remaining Contractual Life (Years) |  | Aggregate Intrinsic Value (In Thousands)
Options outstanding at December 31, 2025 | 24,561,750 |  |  | $ | 1.58 |  |  | 7.6 |  | $ | 7,505 |
Granted | 9,638,335 |  |  | 1.40 |  |  |  |  | 4 |
Exercised | (1,209,034) |  |  | 0.92 |  |  |  |  | 824 |
Forfeited | (3,028,706) |  |  | 1.57 |  |  |  |  | 1,131 |
Expired | (9,382) |  | 2.94 |  |  |  |  | 0
Options outstanding at June 30, 2026 | 29,952,963 |  |  | $ | 1.55 |  |  | 7.8 |  | $ | 10,284 |
Vested and expected to vest at June 30, 2026 | 29,952,963 |  |  | $ | 1.55 |  |  | 7.8 |  | 10,284
Options exercisable at June 30, 2026 | 14,490,871 |  |  | $ | 1.90 |  |  | 6.2 |  | $ | 5,123 |
The weighted average grant date fair value of stock options granted during the three and six months ended June 30, 2026 were $1.01 and $1.17, respectively. The weighted average grant date fair value of stock options granted during the three and six months ended June 30, 2025 were $0.79 and $0.76, respectively. The total fair value of stock options vested during the three and six months ended June 30, 2026 were $0.9 million and $3.8 million, respectively. The total fair value of stock options vested during the three and six months ended June 30, 2025 were $0.8 million and $4.7 million, respectively. RSUs The following table summarizes the Company's unvested RSU activity:
| Number of Shares |  | Weighted Average Grant Date Fair Value |  |  |  |
RSUs unvested at December 31, 2025 | 851,652 |  |  | $ | 1.13 |  |  |  |  |
Granted | 2,885,565 |  |  | $ | 1.40 |  |  |  |  |
Vested | (764,589) |  |  | $ | 1.21 |  |  |  |  |
Forfeited | (626,393) |  |  | $ | 1.37 |  |  |  |  |
RSUs unvested at June 30, 2026 | 2,346,235 |  |  | $ | 1.37 |  |  |  |  |
PSUs In December 2023, pursuant to the 2019 Plan, the Compensation Committee of the Company's Board of Directors adopted a form of performance restricted stock unit agreement (the "PSU Agreement"). Pursuant to the PSU Agreement, the Company granted 615,467, 256,885 and 3,314,445 of market-based performance stock units at target on January 2, 2024, April 16, 2024, and January 2, 2025, respectively. The PSUs granted in 2024 cliff vest after the requisite service period ending on December 31, 2026. The PSUs granted in 2025, cliff vest after the requisite period ending on December 31, 2027. The PSUs have the potential to be earned at between 0% and 200% of the number of awards granted depending on the level of growth of the Company's total shareholder return ("TSR") as compared to the TSR of the companies within the Nasdaq Biotechnology Index over the performance period. The fair value of the market-based PSUs was determined using a Monte Carlo simulation technique. In the fourth quarter of 2025, the Compensation Committee of the Company's Board of Directors conducted a review, with its compensation consultant, of total equity ownership of the Company’s Chief Executive Officer, Dr. Shankar Musunuri, as compared to founder chief executive officers in the Company’s peer group. On December 12, 2025, upon recommendation of the Compensation Committee, the Board approved an award of 9,369,604 PSUs (the “2026 PSUs”) to Dr. Musunuri, in addition to Dr. Musunuri’s regular annual equity award, which were granted on January 2, 2026. The 2026 PSUs are subject to a three year performance period ending December 31, 2028 (the “Performance Period”) and will vest upon the Compensation Committee’s determination of the Company’s achievement of certain performance milestones as follows: (i) two-thirds of the 2026 PSUs will vest upon certain regulatory milestones and (ii) one-third of the 2026 PSUs will vest upon the achievement of a market capitalization related milestone, in each case during the Performance Period. The performance milestones may be achieved (and the 2026 PSUs earned) at any time during the Performance Period, and the 2026 PSUs will vest and be settled in shares of the Company’s Common Stock at such time as the Compensation Committee certifies that an applicable performance milestone has been achieved, subject to Dr. Musunuri’s continued service with the Company through the applicable achievement date. Any 2026 PSUs for which a performance milestone has not been achieved by the end of the Performance Period will be cancelled and forfeited. Upon any termination of service, any portion of the 2026 PSUs that is unvested and unearned as of the termination date will be forfeited. For the portion of the 2026 PSUs with regulatory milestone-based vesting conditions, the fair value of the RSU or PSU is determined by the market price of a share of the Company's common stock on the grant date. For the portion of the 2026 PSUs with a market capitalization-based vesting condition, the Company estimates grant-date fair value using a Monte Carlo simulation model. Letter Agreement Regarding Equity Awards On January 20, 2026, the Company entered into a Letter Agreement Regarding Equity Awards (the “Letter Agreement”) with its Chief Executive Officer, Shankar Musunuri, that amends certain administrative and settlement terms applicable to previously granted equity awards under the 2019 Plan. The Letter Agreement applies to specified portions of the following outstanding equity awards (collectively, the “Covered Awards”): ◦2026 Stock Options: Options granted on January 2, 2026 to purchase 3,123,201 shares, of which 2,000,000 options are subject to the Letter Agreement. ◦2026 PSUs: A target award granted on January 2, 2026 of 9,369,604 PSUs, of which 6,000,000 PSUs are subject to the Letter Agreement. The 2026 PSUs vest upon the achievement of specified performance and market conditions. ◦2025 Performance-Based Restricted Stock Units (“2025 PSUs”): A target award granted on January 2, 2025 of 1,388,889 PSUs, of which 1,000,000 PSUs are subject to the Letter Agreement. The 2025 PSUs vest based on the Company’s relative stock performance compared to a peer index over a three-year performance period. Under the Letter Agreement, vesting of the Covered Awards continues in accordance with the original award agreements and the 2019 Plan. In addition, vested Covered Awards are not subject to forfeiture solely as a result of the authorized share shortfall. With respect to the Covered Options, exercisability of the 2,000,000 options subject to the Letter Agreement is suspended until an authorized share increase becomes effective. The contractual expiration date and post-termination exercise provisions are otherwise unchanged; however, if the suspension of exercisability continues beyond 90 days after the original expiration date, the option term is automatically extended for the length of the suspension to preserve the option’s original economic life. For PSUs that vest, settlement in shares is deferred until an authorized share increase becomes effective. If the authorized share increase is not effective by March 15 of the calendar year following the year of vesting, the Company must either deliver shares from alternative sources or settle the vested PSUs in cash, at Dr. Musunuri's election, based on fair market value as of the vesting date. The Company evaluated the Letter Agreement under ASC 718-20-35-2A to assess whether modification accounting was required for each category of Covered Awards. Options — The Company concluded that the Letter Agreement modified the original grant by introducing a performance condition related to the increase in authorized shares which is necessary for the options to become exercisable. Since the share increase is outside the control of the Company and cannot be considered probable, the Letter Agreement was determined to be a probable to improbable, or Type II, modification. In this case, ASC 718 requires expense measurement and recognition to continue under the original terms of the option grant. Accordingly, the Company continued to recognize the expense associated with the options in normal course during the six months ended June 30, 2026. 2026 PSUs — Based on the expected order in which the 2026 PSU tranches will vest, the Company determined that the Letter Agreement's settlement restrictions apply to the performance-condition tranches, which were not probable of vesting at either the grant date or the Letter Agreement date. The market-condition tranche is not subject to the Letter Agreement’s restrictions. Because the tranches subject to the Letter Agreement were not probable of vesting both immediately before and after the Letter Agreement, the Company has not recognized compensation cost for those PSUs. 2025 PSUs — The Letter Agreement introduced a contingent cash settlement feature, which resulted in a change in the classification of the 2025 PSUs. The Company concluded that the contingent cash settlement feature requires liability classification because it cannot be considered probable that the authorized share limitation will be resolved prior to the date on which cash settlement would be available to the Dr. Musunuri. Accordingly, the 1,000,000 2025 PSUs subject to the Letter Agreement were classified as other non-current liability. The Company applied modification accounting and additional compensation cost was recognized to reflect the fair value of the liability in excess of compensation cost previously recognized. The Company remeasured the fair value of the 2025 PSUs subject to the Letter Agreement as of the modification date and will remeasure the fair value at each reporting date. During the six months ended June 30, 2026, the Company recognized $0.9 million of incremental stock-based compensation expense related to the modification of the 2025 PSUs. As of June 30, 2026, $1.3 million was recorded in Other non-current liability related to the modified PSU awards. The following table summarizes the unvested PSU activity:
| Number of Shares |  | Weighted Average Grant-Date Fair Value
PSUs unvested at December 31, 2025 | 4,186,797 |  |  | $ | 1.61 |
Granted | 9,369,604 |  |  | $ | 0.23 |
Vested | — |  |  | $ | — |
Forfeited | (1,717,762) |  |  | $ | 1.74 |
PSUs unvested at June 30, 2026 | 11,838,639 |  |  | $ | 1.51 |

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