Augmedix, Inc. Annual report pursuant to Section 13 and 15(d)

Annual report pursuant to Section 13 and 15(d)

Equity Incentive Plan

Equity Incentive Plan

12 Months Ended

Dec. 31, 2023

Share-Based Payment Arrangement [Abstract]

The Company has granted share-based payment awards to employees, non-employee directors and service providers of the Company under the Augmedix, Inc. 2020 Equity Incentive Plan (“2020 Plan”).

The 2020 Plan authorizes the award of stock options, restricted stock awards ("RSAs"), stock appreciation rights ("SARs"), restricted stock units ("RSUs"), performance awards, cash awards, and stock awards. Certain awards provide for accelerated vesting in the event of a change in control. Options issued may have a contractual life of up to 10 years and may be exercisable in cash or as otherwise determined by the Board of Directors. Vesting generally occurs over a period of not greater than four years.

The number of shares reserved for issuance under the 2020 Plan did increase on January 1, 2022 and 2023 and will increase each year thereafter through 2030 by the number of shares equal to the lesser of 5% of the total number of outstanding shares of the Company’s common stock as of the immediately

preceding December 31st, or a number as may be determined by the Board of Directors. As of December 31, 2023, 326,495 shares remained available for grant under the 2020 Plan.

The Company recorded share-based compensation expense in the following expense categories in the consolidated statements of operations and comprehensive loss for the years ended December 31, 2023 and 2022:


	Year ended December 31,
	2023		2022
General and administrative	$	1,655	$	1,527
Sales and marketing	259		173
Research and development	432		323
Cost of revenues	125		89
Total	$	2,471	$	2,112

No income tax benefits have been recognized in the consolidated statements of operations and comprehensive loss for share-based compensation arrangements and $14 thousand of share-based compensation costs have been capitalized as property and equipment during the year ended December 31, 2023.

The grant date fair value of stock options and stock appreciation rights was estimated using the Black-Scholes option-pricing model with the following weighted average assumptions:


	Year ended December 31,
	2023		2022
Expected term (in years)	5.9		5.9
Expected Volatility	57.1	%	54.8	%
Risk-free rate	4.0	%	2.2	%
Dividend rate	—		—

The weighted average grant date fair value of stock option awards granted was $1.24 and $1.19 during the years ended December 31, 2023 and 2022, respectively.

The following table summarizes stock option and SARs activity for the year ended December 31, 2023:


Stock Options and Stock Appreciation Rights	Number of Shares under Option Plan	Weighted- Average Exercise Price per Option		Weighted- Average Remaining Contractual Life (in years)
Outstanding at December 31, 2022	8,234,823	$	1.82	7.7
Granted	1,784,446	2.19
Exercised	(442,573)	$	1.32
Forfeited and expired	(234,107)	$	2.49
Outstanding at December 31, 2023	9,342,589	$	1.94	7.2
Exercisable at December 31, 2023	6,028,787	$	1.64	6.6
Vested and expected to vest at December 31, 2023	9,342,589	$	1.94	7.2

The options exercised during the years ended December 31, 2023 and 2022 had an intrinsic value of $1.2 million and $0.1 million, respectively. The aggregate intrinsic value of options outstanding and options exercisable as of December 31, 2023 were $36.5 million and $25.4 million, respectively. At December 31, 2023, future share-based compensation for options granted and outstanding of $3.0 million will be recognized over a remaining weighted-average requisite service period of 2.2 years.


RSUs and Stock Awards	Number of Shares under Option Plan	Weighted Average Grant Date Fair Value
Outstanding at December 31, 2022	263,155	$	1.90
Granted	320,097	$	4.91
Vested	(272,264)	$	2.02
Forfeited and expired	(7,300)	$	4.15
Outstanding at December 31, 2023	303,688	$	4.91

The aggregate intrinsic value of RSU's outstanding as of December 31, 2023 were $1.8 million. At December 31, 2023, future share-based compensation for RSU's granted and outstanding of $1.1 million will be recognized over a remaining weighted-average requisite service period of 2.7 years.

Performance and Market-Based Options

In March 2021, the Company granted 727,922 stock options to the Chief Executive Officer (“CEO”) under the 2020 Plan with an exercise price of $3.00 per share. The options vest based on the CEO’s continued service in addition to the following terms:

•317,688 options vest in full when the closing price of the Company’s common stock reaches or exceeds $9.00 per share for a minimum of 20 out of 30 trading days after the Company becomes listed on the New York Stock Exchange or Nasdaq. These options expire on March 3, 2031.

•46,273 options vest in full when the closing price of the Company’s common stock reaches or exceeds $9.00 per share for 20 out of 30 trading days after the Company becomes listed on the New York Stock Exchange or Nasdaq. Since the listing on Nasdaq, these options expire on March 22, 2031, instead of 2026.

•363,961 options vest in full when the closing price of the Company’s common stock reaches or exceeds $13.50 per share for 20 out of 30 trading days after the Company becomes listed on the New York Stock Exchange or Nasdaq. Since the listing on Nasdaq, these options expire on March 22, 2031, instead of 2026.

As of December 31, 2023, the unamortized share-based compensation expense was $30 thousand which the Company will plans to recognize over a weighted average period of 0.62 years. If the market conditions are achieved, any remaining unrecognized compensation cost associated with those options will be immediately recognized.