XML 37 R22.htm IDEA: XBRL DOCUMENT
v3.25.0.1

Stock-Based Compensation and Other Benefit Plans | 12 Months Ended
--- | ---
Dec. 31, 2024
Share-Based Payment Arrangement [Abstract] |
Stock-Based Compensation and Other Benefit Plans | Stock-Based Compensation and Other Benefit Plans Stock-Based Incentive Plans In June 2024, Company stockholders approved an amendment to the Flotek Industries, Inc. 2018 Long-Term Incentive Plan (the “2018 Plan”) to increase the number of shares of Company common stock eligible for issuance under the 2018 Plan. The 2018 Plan permits the Company to grant equity awards to officers, key employees, non-employee directors and service providers in the form of stock options, restricted stock, restricted stock units, and certain other incentive awards. In addition, the Company has two other long-term incentive plans, which were created in 2020 and 2019 (the “2020 Plan” and “2019 Plan,” respectively). The maximum number of shares that may be issued under the 2020 Plan, the 2019 Plan and 2018 Plan are 0.5 million, 0.2 million, and 2.4 million, respectively. At December 31, 2024 and 2023, the Company had 0.6 million and 0.6 million shares remaining, respectively, to be granted under the 2020 Plan, 2019 Plan and 2018 Plan in the aggregate. Stock Options All stock options are granted with an exercise price equal to the market value of the Company’s common stock on the date of grant. During the year ended December 31, 2024, there were no grants of market-based or performance-based stock options compared to 0.1 million market-based stock options and 0.1 million performance-based stock options that were granted during the year ended December 31, 2023. The market-based and performance-based options are restricted until criteria defined in the stock option agreements are met. Proceeds received from stock option exercises are credited to common stock and additional paid-in capital, as appropriate. The Company uses historical data to estimate pre-vesting option forfeitures. Estimates are adjusted when actual forfeitures differ from the estimate. Stock-based compensation expense is recorded for all equity awards expected to vest. During the year ended December 31, 2024, 24 thousand stock options vested compared to none for the year ended December 31, 2023. The total fair value of the stock options that vested was $0.1 million for the year ended December 31, 2024. Stock option activity for the years ended December 31, 2024 and 2023, was as follows:
| Shares |  | Weighted-Average Exercise Price |  | Weighted-Average Fair Value |  |  |  |  |  |  |  |
Outstanding as of December 31, 2022 | 693,650 |  |  |  |  |  |  |  |  |  |  |  |  |
Granted | 190,728 |  |  | $ | 3.42 |  |  | $ | 2.57 |  |  |  |  |  |  |  |  |
Exercised | — |  |  | $ | — |  |  | $ | — |  |  |  |  |  |  |  |  |
Forfeited | (457,815) |  |  | $ | 7.10 |  |  | $ | 7.28 |  |  |  |  |  |  |  |  |
Expired | (130,000) |  |  | $ | 7.97 |  |  | $ | 5.94 |  |  |  |  |  |  |  |  |
Outstanding as of December 31, 2023 | 296,563 |  |  |  |  |  |  |  |  |  |  |  |  |
Granted | — |  |  | $ | — |  |  | $ | — |  |  |  |  |  |  |  |  |
Exercised | — |  |  | $ | — |  |  | $ | — |  |  |  |  |  |  |  |  |
Forfeited | (29,367) |  |  | $ | 6.58 |  |  | $ | 4.49 |  |  |  |  |  |  |  |  |
Expired | (47,918) |  |  | $ | 5.46 |  |  | $ | 5.47 |  |  |  |  |  |  |  |  |
Outstanding as of December 31, 2024 | 219,278 |  |  |  |  |  |  |  |  |  |  |  |  |
Vested or expected to vest at December 31, 2024 | 185,489 |  |  |  |  |  |  |  |  |  |  |  |  |
The below table shows the aggregate intrinsic value and weighted average remaining contractual term of share options outstanding, currently exercisable and vested or expected to vest.
| Share Options Outstanding |  | Share Options Currently Exercisable |  | Share Options Vested or Expected to Vest
Number | 219,278 |  | 34,306 |  | 185,489
Weighted-average exercise price | $ | 3.91 |  |  | $ | 6.49 |  |  | $ | 3.97 |
Aggregate intrinsic value ($000’s) | $ | 1,230 |  |  | $ | 102 |  |  | $ | 1,029 |
Weighted-average remaining contractual term in years | 8.12 |  | 4.64 |  | 8.03
The following table sets forth significant assumptions used in the Monte Carlo model for market-based options to determine the fair value of the 61,984 options awarded in June 2023 at the date of grant.
|  |  | June 7, 2023 Awards |  |  |  |
Risk-free interest rate |  |  | 3.79 | % |  |  |  |
Expected volatility of common stock |  |  | 110.00 | % |  |  |  |
Expected life of options in years |  |  | 10.0 |  |  |  |
Dividend yield |  |  | — | % |  |  |  |
The following table sets forth significant assumptions used in the Black-Scholes model for performance options to determine the fair value of the 128,744 options awarded in December 2023 at the date of grant.
|  |  | December 5, 2023 Awards |  |  |  |
Risk-free interest rate |  |  | 4.13 | % |  |  |  |
Expected volatility of common stock |  |  | 90.60 | % |  |  |  |
Expected life of options in years |  |  | 6.5 |  |  |  |
Dividend yield |  |  | — | % |  |  |  |
At December 31, 2024 and 2023, the unrecognized compensation cost related to stock options was $0.4 million and $0.6 million, respectively. There were no options granted during the year ended December 31, 2024. Restricted Stock The Company grants employees and directors either time-vesting or performance-based restricted shares of common stock (“RSAs”) in accordance with terms specified in the applicable RSA Agreements. During the years ended December 31, 2024 and 2023, all of the RSAs granted were time-vested. Grantees of RSAs retain voting rights for the granted restricted shares. •Time-vesting RSAs vest after a stipulated period has elapsed after the date of grant, generally three years. Certain time-vested RSAs have also been issued with a portion of the shares granted vesting immediately. •Performance-based RSAs are issued with criteria defined over a designated period and vest only when, and if, the outlined criteria are met. RSA activity for the years ended December 31, 2024 and 2023, are as follows:
Restricted Stock Shares |  | Shares |  | Weighted- Average Fair Value at Date of Grant
Non-vested RSAs at December 31, 2022 |  | 384,534 |  |  | $ | 8.23 |
Granted |  | 146,204 |  |  | $ | 4.52 |
Vested |  | (186,058) |  |  | $ | 7.81 |
Forfeited |  | (95,667) |  |  | $ | 9.25 |
Non-vested RSAs at December 31, 2023 |  | 249,013 |  |  | $ | 5.97 |
Granted |  | 93,760 |  |  | $ | 4.43 |
Vested |  | (182,319) |  |  | $ | 5.47 |
Forfeited |  | (11,528) |  |  | $ | 7.77 |
Non-vested RSAs at December 31, 2024 |  | 148,926 |  |  | $ | 5.46 |
The total fair value of RSAs that vested during the years ended December 31, 2024 and 2023 was $0.9 million and $0.9 million, respectively. The grant-date fair value is the market price of the RSAs on the date of grant. At December 31, 2024 and 2023, unrecognized compensation expense related to non-vested RSAs was $0.4 million and $0.9 million, respectively. The unrecognized compensation expense is expected to be recognized over a weighted-average period of 1.5 years. Restricted Stock Units The Company grants either time-vesting or performance-based restricted share units (“RSUs”) in accordance with terms specified in the applicable RSU Agreements. Grantees of RSUs do not have voting rights for the granted RSUs until such time as the applicable RSUs vests and shares of common stock are issued. •Time-vesting RSUs vest after a stipulated period has elapsed after the date of grant, generally three years. •Performance-based RSUs are issued with criteria defined over a designated period and vest only when, and if, the outlined criteria are met. RSU activity for the years ended December 31, 2024 and 2023, was as follows:
Restricted Stock Units |  | Units |  | Weighted- Average Fair Value at Date of Grant
Non-vested RSUs at December 31, 2022 |  | 102,481 |  |  | $ | 11.42 |
Granted |  | 230,816 |  |  | $ | 3.82 |
Vested |  | (82,730) |  |  | $ | 10.64 |
Forfeited |  | (38,000) |  |  | $ | 11.58 |
Non-vested RSUs at December 31, 2023 |  | 212,567 |  |  | $ | 3.44 |
Granted |  | 459,054 |  | $ | 4.81 |
Vested |  | (71,476) |  |  | $ | 3.75 |
Forfeited |  | (48,098) |  |  | $ | 3.28 |
Non-vested RSUs at December 31, 2024 |  | 552,047 |  |  | $ | 4.55 |
T he total fair value of RSUs that vested during the years ended December 31, 2024 and 2023 was $0.5 million and $0.5 million, respectively. The grant-date fair value is the market price of the shares on the date of grant. The RSUs granted in 2024 included 147,050 performance-based RSUs, half of which will vest upon achievement of a market-based criteria and half of which will vest upon achievement of a non-market-based criteria. The units with a market-based vesting criteria were valued using a Monte Carlo valuation model to determine the fair value of the awards as of the date of the grant. The following table sets forth significant assumptions used in the Monte Carlo model to determine the grant date fair value of the 73,525 performance-based RSUs with a market-based vesting criteria awarded in 2024.
|  |  | October 30, 2024 Awards |  |  |  |
Risk-free interest rate |  |  | 4.20 | % |  |  |  |
Expected volatility of common stock |  |  | 53.10 | % |  |  |  |
Expected life of RSU in years |  |  | 1.2 |  |  |  |
Dividend yield |  |  | — | % |  |  |  |
At December 31, 2024 and 2023, unrecognized compensation expense related to RSUs was $2.3 million and $0.7 million, respectively. The unrecognized compensation expense is expected to be recognized over a weighted-average period of 2.3 years. Non-vested RSUs at December 31, 2024 consist of both time-vesting and performance-based awards. Employee Stock Purchase Plan The Company’s Employee Stock Purchase Plan (“ESPP”) was approved by stockholders in 2012. The Company registered 500,000 shares of its common stock, currently held as treasury shares, for issuance under the ESPP. The purpose of the ESPP is to provide employees with an opportunity to purchase shares of the Company’s common stock through accumulated payroll deductions. The ESPP allows participants to purchase common stock at a purchase price equal to 85% of the fair market value of the common stock on the last business day of a three-month offering period which coincides with calendar quarters. Payroll deductions may not exceed 10% of an employee’s compensation. In addition, for each calendar year, an employee may not be granted purchase rights valued over $25,000, as determined at the time such purchase right is granted. The fair v alue of the discount associated with shares purchased under the plan is recognized as stock-based compensation expense and wa s $20 thousand and $14 thousand for the years ended December 31, 2024 and 2023, respectively. The total fair value of the shares purchased under the plan during the years ended December 31, 2024 and 2023 was $0.1 million and $0.1 million, respectively. The employee payment associated with participation in the plan occurs through payroll deductions. Stock-Based Compensation Expense Stock-based compensation expense related to stock options, restricted stock, restricted stock unit grants and stock purchased under the Company’s ESPP was $1.4 million and $(0.3) million during the years ended December 31, 2024 and 2023, respectively. Stock based compensation expense for the year ended December 31, 2023 included an adjustment for actual forfeitures of $1.6 million that reduced the total stock-compensation expense. During 2023, the Company settled vested equity awards of a terminated officer through a cash payment. The cash payment was made to the employee in lieu of the equity awards, which were previously granted and vested. The settlement amount was determined based on the fair value of the equity awards at the time of termination. The Company used the Black-Scholes Model to value the vested equity awards. This transaction resulted in a reduction of the Company's equity awards liability and a corresponding outflow of cash for $0.6 million. The key inputs to the Black-Scholes Model used to estimate the fair value of the vested equity awards, as of the date of the termination were as follows:
|  |  | January 19, 2023 |  |  |  |
Risk-free interest rate |  |  | 3.79 | % |  |  |  |
Expected volatility of common stock |  |  | 90.00 | % |  |  |  |
Expected life of options in years |  |  | 6.92 |  |  |  |
Stock price (1) |  |  | $ | 1.37 |  |  |  |  |
Strike Price |  |  | $ | 1.93 |  |  |  |  |
(1)Stock price is based on the price of common shares prior to the Company’s 1-for-6 reverse stock split in September 2023. |  |  |  |
401(k) Retirement Plan The Company maintains a 401(k) retirement plan for the benefit of eligible employees in the U.S. All U.S. based employees are eligible to participate in the plan upon employment. The Company currently matches contributions at 100% of up to 2% of an employee’s contributions. During the years ended December 31, 2024 and 2023, compensation expense included $0.3 million and $0.3 million, respectively, related to the Company’s 401(k) match.

X
- Definition The entire disclosure for an entity's employee compensation and benefit plans, including, but not limited to, postemployment and postretirement benefit plans, defined benefit pension plans, defined contribution plans, non-qualified and supplemental benefit plans, deferred compensation, share-based compensation, life insurance, severance, health care, unemployment and other benefit plans. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 710 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/710/tableOfContent Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 712 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/712/tableOfContent Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 715 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/715/tableOfContent Reference 4: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 718 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/718/tableOfContent + Details
Name: | us-gaap_CompensationAndEmployeeBenefitPlansTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration

X
- References No definition available. + Details
Name: | us-gaap_DisclosureOfCompensationRelatedCostsSharebasedPaymentsAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration