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Note 11 - Benefit Plans

9 Months Ended

Sep. 30, 2024

Notes to Financial Statements

Share-Based Payment Arrangement [Text Block]

Note 11. Benefit Plans

401(k) Plan

Our 401(k) plan is a deferred salary arrangement under Section 401(k) of the Internal Revenue Code. We match 100% of a participating employee’s deferral contributions up to 3% of annual compensation, limited to $4,500 of matching contributions. Our contributions to the 401(k) plan totaled $34,000 and $31,000 during the three months ended September 30, 2024 and 2023, respectively; and $0.1 million and $0.2 million during the nine months ended September 30, 2024 and 2023, respectively.

Stock Compensation Plans

The Clene Nanomedicine, Inc. 2014 Stock Plan (the “2014 Plan”) was adopted in July 2014. Effective as of the closing of the Reverse Recapitalization, no additional awards may be granted under the 2014 Plan. As of September 30, 2024, 164,684 stock options remained outstanding under the 2014 Plan.

The Clene Inc. 2020 Amended Stock Plan (the “2020 Plan”) was adopted in December 2020 and amended in May 2023 and May 2024. Currently, 2,420,000 shares of Common Stock are reserved for issuance thereunder. As of September 30, 2024, a total of 1,785,141 stock options and other stock awards had been granted under the 2020 Plan, and 634,859 shares remained available for future grant.

Stock-Based Compensation Expense

Stock-based compensation expense recorded in research and development expense and general and administrative expense during the three and nine months ended September 30, 2024 and 2023 was as follows:

		*Three Months Ended September 30,*								*Nine Months Ended September 30,*
(in thousands)		*2024*				*2023*				*2024*				*2023*
General and administrative		$	1,126			$	1,311			$	3,310			$	3,888
Research and development			1,062				1,085				2,842				3,182
Total stock-based compensation expense		$	2,188			$	2,396			$	6,152			$	7,070

Stock-based compensation expense by award type during the three and nine months ended September 30, 2024 and 2023 was as follows:

		*Three Months Ended September 30,*								*Nine Months Ended September 30,*
(in thousands)		*2024*				*2023*				*2024*				*2023*
Stock options		$	2,194			$	2,384			$	6,147			$	7,044
Stock awards			(6	)			12				5				26
Total stock-based compensation expense		$	2,188			$	2,396			$	6,152			$	7,070

Stock Options

Outstanding stock options and related activity during the nine months ended September 30, 2024 was as follows:

(in thousands, except share, per share, and term data)		*Number of Options*				*Weighted Average Exercise Price Per Share*				*Weighted Average Remaining Term (Years)*				*Intrinsic Value*
Outstanding – December 31, 2023			1,092,343			$	45.20				7.28			$	302
Granted			918,849				7.04				9.72				—
Exercised			(41,090	)			3.00				—				65
Forfeited			(12,288	)			88.26				—				—
Expired			(61,770	)			—				—				—
Outstanding – September 30, 2024			1,896,044			$	28.76				8.43			$	—
Vested and exercisable – September 30, 2024			728,239			$	51.48				7.05			$	—
Vested, exercisable or expected to vest – September 30, 2024			1,896,044			$	28.76				8.43			$	—

As of September 30, 2024 and December 31, 2023, we had approximately $10.2 million and $13.7 million, respectively, of unrecognized stock-based compensation costs related to non-vested stock options that is expected to be recognized over a weighted-average period of 1.81 years and 2.10 years, respectively. Our unrecognized stock-based compensation costs excludes $2.8 million of stock options that vest based on performance conditions that we assessed as less than probable as of September 30, 2024. As of December 31, 2023, we had not granted stock options with performance conditions.

The weighted-average grant-date fair value of stock options granted during the nine months ended September 30, 2024 and 2023 was $6.09 and $15.00, respectively. The assumptions used to calculate the fair value of stock options granted during the nine months ended September 30, 2024 and 2023 were as follows:

		Nine Months Ended September 30,
		2024				2023
Expected stock price volatility			97.78% –111.49	%			96.22% –103.24	%
Risk-free interest rate			3.62% –4.58	%			3.26% –4.41	%
Expected dividend yield			0.00	%			0.00	%
Expected term of options (in years)			5.00 –10.00				5.00 –6.43

Stock Awards

Stock awards include rights to restricted stock awards with market-based vesting conditions and restricted stock units with service-based vesting conditions. Outstanding stock awards and related activity during the nine months ended September 30, 2024 was as follows:

		*Number of Stock Awards*				*Weighted Average Grant Date Fair Value*
Unvested balance – December 31, 2023			38,943			$	194.41
Converted to shares of Common Stock upon vesting			(543	)			23.00
Forfeited			(959	)			196.84
Unvested balance – September 30, 2024			37,441			$	196.84

As of September 30, 2024, we had no unrecognized stock-based compensation cost related to non-vested stock awards. As of December 31, 2023, we had approximately $11,000 of unrecognized stock-based compensation costs related to non-vested stock awards expected to be recognized over a weighted-average period of 0.23 years.