13. Shareholders' Equity

LP Units of JJ LP

The limited partnership units (“LP Units”) of JJ LP, a subsidiary of the Company, are exchangeable for one common share at any time per request of the owner of the LP Units and are not saleable or transferable without the Company’s authorization. During each of the nine months ended September 30, 2024 and 2023, there were no LP Units of JJ LP converted to common shares. As of each of September 30, 2024 and December 31, 2023, 43,821,379 LP Units of JJ LP were issued and outstanding.

Warrants

In connection with the NPA Amendment, the Company issued 91,999,901 Debt Modification Warrants. Each Debt Modification Warrant is exercisable at any time prior to its expiration for one common share of the Company at an exercise price of $0.07084 per common share. The Debt Modification Warrants expire on February 15, 2030 and contain customary anti-dilution adjustment provisions.

The fair value of the Debt Modification Warrants upon issuance was determined using the Black-Scholes option pricing model with the following assumptions:

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The following table summarizes the warrants that remain outstanding as of September 30, 2024:

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A rollforward of warrant activity for the nine months ended September 30, 2024 is as follows:

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Share-based Compensation

Under the Amended and Restated 2018 Stock and Incentive Plan (the “2018 Plan”), the Company has reserved 60,000,000 common shares to be issued as awards to employees, management, directors and consultants of the Company, as designated by the Company’s board of directors (the “Board”) or the compensation committee of the Board. “Award” is defined in the 2018 Plan to include options, stock appreciation rights, restricted stocks, restricted stock units, performance stock units, dividend equivalents and stock-based awards. As of September 30, 2024, 11,912,146 common shares are available for issuance under the 2018 Plan.

Restricted Stock Units (“RSUs”)

A summary of the status of the RSUs outstanding is as follows:

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During the three months ended September 30, 2024 and 2023, the Company recorded $3 of share-based compensation expense and $146 of share-based compensation benefit, respectively, relating to RSUs. During the nine months ended September 30, 2024 and 2023, the Company recorded $74 of share-based compensation expense and $160 of share-based compensation benefit, respectively, related to RSUs. For the three months ended March 31, 2023, the share-based compensation expense relating to RSUs included $53 related to the performance awards for achievement of milestones relating to the projects of the Company’s joint venture in CGSF. During the three months ended June 30, 2023, the Company determined achievement of the milestones related to CGSF projects was no longer probable. As a result, the Company reversed all share-based compensation expense recognized for the performance awards and recorded share-based compensation benefit of $1,287 and $1,234 for the three and six months ended June 30, 2023. No share-based compensation benefit or expense was recognized related to this event during the three months ended September 30, 2023. Due to the CGSF/SFNY Divestiture, no share-based compensation related to performance awards was recognized during the three and nine months ended September 30, 2024.

On June 12, 2023, the Company approved the grant of 2,468,301 RSUs to the audit committee chair of the Board, and 7,404,903 RSUs to three new members of the Board. These RSUs were issued at a weighted average grant date fair value of $0.03, and share-based compensation expense of $137 and $165 was recognized related to these RSUs during the three and nine months ended September 30, 2023. Share-based compensation expense of $0 and $55 was recognized related to these RSUs during the three and nine months ended September 30, 2024, respectively.

During August 2023, the Board granted 3,196,678 RSUs and issued 538,425 shares to certain employees in connection with their employment with the Company. Of these RSUs, 143,525 had vested as of September 1, 2023 and 443,537 vested on December 1, 2023. The remaining RSUs are scheduled to vest on a quarterly basis through December 1, 2026. These RSUs were issued at a weighted-average grant date fair value of $0.0294, and share-based compensation expense of $6 and $25 was recognized related to these RSUs during the three and nine months ended September 30, 2024, respectively. Share-based compensation expense of $29 was recognized related to these RSUs during each of the three and nine months ended September 30, 2023.

As of September 30, 2024, there was $26 of remaining RSU expense to be recognized over the weighted average remaining period of 1.22 years.

Share Options

A summary of the status of the share options outstanding is as follows:

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For the three months ended September 30, 2024 and 2023, the Company recorded share-based compensation expense of $106 and $26, respectively, related to these options. For the nine months ended September 30, 2024 and 2023, the Company recorded share-based compensation expense of $126 and $60, respectively, of share-based compensation related to these options.

On September 29, 2024, the Company entered into an independent director compensation agreement that approved issuance of 27,878,788 options to four members of the Board, with each member granted 6,969,697 share options. These options were issued at a weighted-average grant date fair value of $0.0143, and share-based compensation expense of $104 was recognized related to these options during the three months ended September 30, 2024. On September 30, 2024 6,969,697 options vested, with each Board member receiving 1,742,424 options. The remaining options are scheduled to vest on December 31, 2024, March 31, 2025, and the business day immediately preceding the next annual general meeting of shareholders.

As of September 30, 2024, there was $303 of remaining expense to be recognized over the weighted average remaining period of 0.49 years.

The following table summarizes the share options that remain outstanding as of September 30, 2024:

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Performance Stock Units (“PSUs”)

A summary of the status of the PSUs outstanding is as follows:

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During the three and nine months ended September 30, 2024, the Company recorded share-based compensation expense of $23 and $62, respectively, relating to PSUs.

During April 2023, the Company’s former CEO, Gary F. Santo, Jr. forfeited various share awards, including PSUs. The forfeiture of PSUs resulted in share-based compensation benefit of $944 and $812 for the three and six months ended June 30, 2023, respectively. No additional expense or benefit was recognized related to this forfeiture during the three months ended September 30, 2023 and the three and nine months ended September 30, 2024.

On September 26, 2023, the Company entered into an employment agreement with Tim Conder, the Company’s CEO (the “CEO Agreement”) pursuant to which Mr. Conder serves as the CEO of the Company. Under the terms of the CEO Agreement, Mr. Conder received an equity grant of 2,000,000 PSUs under the 2018 Plan of which up to 1,000,000 PSUs would vest upon the Board’s approval of whether metrics set forth in the CEO Agreement had been achieved as of December 31, 2023. On April 19, 2024, the Board determined that two-thirds of the metrics set forth in the CEO Agreement

had been achieved as of December 31, 2023 and Mr. Conder is entitled to 666,666 PSUs. On April 19, 2024, the Company also entered into a side letter with Mr. Conder pursuant to which Mr. Conder agreed that the 666,666 PSUs would vest on June 30, 2024. These PSUs vested per the side letter on June 30, 2024.

As of December 31, 2023, Mark Scatterday, the Company’s former CEO and director, and major stockholder and lender, had an aggregate of 700,000 PSUs outstanding, which will vest on May 31, 2025, contingent upon the achievement of certain subsequent sales of products by Jupiter.

As of September 30, 2024, there was $65 of remaining expense to be recognized over the weighted average remaining period of 0.63 years.

A summary of the PSU awards granted containing market conditions as of September 30, 2024 is as follows:

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