STOCK OPTIONS AND RESTRICTED SHARES

9 Months Ended

Dec. 31, 2025

Share-Based Payment Arrangement [Abstract]

NOTE 16 — STOCK OPTIONS AND RESTRICTED SHARES

At Orion’s 2023 annual meeting of shareholders, Orion’s shareholders approved the Orion Energy Systems, Inc. 2016 Omnibus Incentive Plan, as amended and restated (the “Amended 2016 Plan”). The Amended 2016 Plan increased the number of shares of Orion’s common stock available for issuance under the Amended 2016 Plan from 350,000 shares to 600,000 shares (an increase of 250,000 shares); added a minimum vesting period for all awards granted under the Amended 2016 Plan (with limited exceptions); and added a specific prohibition on the payment of dividends and dividend equivalents on unvested awards.

The Amended 2016 Plan authorizes grants of equity-based and incentive cash awards to eligible participants designated by the Plan's administrator. Awards under the Amended 2016 Plan may consist of stock options, stock appreciation rights, performance shares, performance units, common stock, restricted stock, restricted stock units, incentive awards or dividend equivalent units.

The Amended 2016 Plan also permits accelerated vesting in the event of certain changes of control of Orion as well as under other special circumstances. Certain non-employee directors have from time to time elected to receive stock awards in lieu of cash compensation pursuant to elections made under Orion’s non-employee director compensation program.

During the third quarter of fiscal 2026, it was determined that the performance obligations required for the performance-based shares granted in August 2023 were not likely to be achieved. As such, the approximately $244 thousand expense related to the 33,096 shares was reversed.

The following amounts of Orion's consolidated stock-based compensation were recorded (dollars in thousands):


	For the Three Months Ended December 31,					For the Nine Months Ended December 31,
	2025			2024		2025		2024
Cost of product revenue	$	(4	)	$	1	$	—	$	5
General and administrative		(14	)		175		282		793
Sales and marketing		14			2		35		17
Research and development		1			2		3		7
Total	$	(3	)	$	180	$	320	$	822

The following table summarizes information with respect to performance-vesting restricted stock and time vesting-restricted stock activity:


	Time-Based Restricted Shares					Performance-Based Restricted Shares
	Shares			Weighted Average Fair Value Price		Shares			Weighted Average Fair Value Price
Balance at March 31, 2025		133,159		$	13.00		152,994		$	14.30
Shares issued		48,000		$	5.93		—		$	—
Shares vested		(67,559	)	$	14.81		—		$	—
Shares forfeited		(11,787	)	$	10.19		(72,833	)	$	14.37
Shares outstanding at December 31, 2025		101,813		$	8.80		80,161		$	12.80

The following table summarized information with respect to performance-based option and time-based option activity:


	Time-Based Options				Performance-Based Options
	Options		Weighted Average Exercise Price		Options		Weighted Average Exercise Price
Balance at March 31, 2025		—	$	—		—	$	—
Options granted		26,555	$	6.21		50,000	$	6.00
Options outstanding at December 31, 2025		26,555	$	6.21		50,000	$	6.00

As of December 31, 2025, the amount of deferred stock-based compensation expense to be recognized, over a remaining period of 1.8 years, was approximately $1.0 million.