Total share-based compensation cost was $7.2 million, zero, $8.9 million, $1.4 million, and $1.7 million for the year ended December 27, 2024 (Successor), the period November 15, 2023 through December 29, 2023 (Successor), the period December 31, 2022 through November 14, 2023 (Predecessor), the period June 17, 2022 through December 30, 2022 (Predecessor), and the period January 1, 2022 through June 16, 2022 (Predecessor), respectively. These amounts are generally included within SG&A expenses in the consolidated statements of operations. The Company recognized zero tax benefits associated with this expense for all periods presented.

The Mallinckrodt Pharmaceuticals Stock and Incentive Plan, as amended and restated effective February 2, 2024 provides for the award of share options, share appreciation rights, long-term performance awards and other share-based awards (collectively, “Awards”). The maximum number of common shares to be issued as Awards, subject to adjustment as provided under the terms of the plan was 10% of the total ordinary shares (calculated on a fully-diluted basis) as of the 2023 Effective Date.

On the 2023 Effective Date, all outstanding equity-based awards under the Mallinckrodt Pharmaceuticals Stock and Incentive Plan, as amended and restated effective February 23, 2022, were automatically cancelled without consideration. No awards were granted during the period November 15, 2023 through December 29, 2023 (Successor).

On the 2020 Effective Date, all outstanding equity-based awards under the Mallinckrodt Pharmaceuticals Stock and Incentive Plan, as amended and restated effective February 23, 2022, were automatically cancelled without consideration.

Share options. Share options were granted to purchase the Predecessor Company's ordinary shares at prices that are equal to the fair market value of the shares on the date the share option is granted. Share options generally vest in equal annual installments over a period of four years and expire ten years after the date of grant. The grant-date fair value of share options, adjusted for estimated forfeitures, is recognized as expense on a straight-line basis over the requisite service period, which is generally the vesting period. Forfeitures are estimated based on historical experience. No share options have been granted during the periods presented herein.

Restricted share units (“RSUs”). Recipients of RSUs have no voting rights and receive dividend equivalent units that vest upon the vesting of the related shares. RSUs generally vest in equal annual installments over a period of three years. Restrictions on RSUs lapse upon normal retirement or disability (as such terms are defined in the Mallinckrodt Pharmaceuticals Stock and Incentive Plan), or death of the employee. The grant-date fair value of RSUs, adjusted for estimated forfeitures, is recognized as expense on a straight-line basis over the service period. The fair market value of RSUs granted is determined based on the market value of the Company's shares on the date of grant. As of the 2023 Effective Date, the Company’s ordinary shares were no longer traded on an active market. Accordingly, the fair value of those share-based awards granted after the 2023 Effective Date requires the valuation of the Company’s equity utilizing the application of significant estimates, assumptions, and judgments, as further described in Note 4.

A portion of the RSUs granted during the fiscal year ended December 27, 2024 (Successor) could have been settled in shares and were classified as equity-based awards, and a portion of the RSUs had the ability to be settled in either shares or cash and were classified as liability-based awards. The Company recognized $3.3 million and $2.3 million of equity-based compensation costs and liability-based compensation costs during the fiscal year ended December 27, 2024 (Successor), respectively. The Company paid $0.4 million of liabilities-based awards during the year ended December 27, 2024 (Successor).


	Shares	Weighted-Average Grant-Date Fair Value












Non-vested as of December 31, 2021 (Predecessor)	242,897	19.40
Expired/Forfeited	(242,897)	19.40
Non-vested as of June 16, 2022 (Predecessor)	—	—


Non-vested as of June 17, 2022 (Predecessor)	—	—
Granted	890,485	12.03
Non-vested as of December 30, 2022 (Predecessor)	890,485	12.03
Granted	2,089,814	1.18
Exercised	(332,604)	12.89
Expired/Forfeited	(2,647,695)	3.35
Non-vested as of November 14, 2023 (Predecessor)	—	—


Non-vested as of December 29, 2023 (Successor)	—	—
Granted	262,614	48.19
Forfeited	(5,745)	48.19
Non-vested as of December 27, 2024 (Successor)	256,869	48.19

The total fair value of RSU awards granted during the year ended December 27, 2024 (Successor) was $12.7 million. As of December 27, 2024 (Successor), there was $8.0 million of total unrecognized compensation costs related to non-vested RSUs granted, which is expected to be recognized over a weighted-average period of 1.9 years.

Performance share units (“PSUs”) Similar to recipients of RSUs, recipients of PSUs have no voting rights and receive dividend equivalent units. The grant-date fair value of PSUs, which are deemed probable to vest, are generally recognized as expense on a straight-line basis from the grant-date through the end of the performance period. The vesting of PSUs and related dividend equivalent units is based on a realized value of the Company, as defined by the Awards, or previously, during the Predecessor periods, various performance metrics and relative total shareholder return (total shareholder return for the Company as compared to total shareholder return of the PSU peer group).

A portion of the PSUs granted during the period June 17, 2022 (Predecessor) to December 30, 2022 (Predecessor) and the period December 31, 2022 to November 14, 2023 (Predecessor) could have been settled in shares and were classified as equity-based awards, and a portion of the PSUs had the ability to be settled in either shares or cash and were classified as liability-based awards. The Company recognized $1.6 million, $2.6 million and $0.1 million of equity-based compensation costs during the year ended December 27, 2024, the period December 31, 2022 (Predecessor) through November 14, 2023 (Predecessor) and the period June 17, 2022 (Predecessor) through December 30, 2022 (Predecessor), respectively. The fair value of the liability-based awards was measured quarterly and based on the Company's performance.


	Shares	Weighted-Average Grant-Date Fair Value











Non-vested as of June 17, 2022 (Predecessor)	—	—
Granted	675,821	8.34
Non-vested as of December 30, 2022 (Predecessor)	675,821	8.34
Granted	1,459,493	10.13
Forfeited	(2,135,314)	10.36
Non-vested as of November 14, 2023 (Predecessor)	—	—


Non-vested as of December 29, 2023 (Successor)	—	—
Granted	525,247	48.19
Non-vested as of December 27, 2024 (Successor)	525,247	48.19

For the awards granted during the fiscal year ended December 27, 2024 (Successor), the fair value of those share-based awards required the valuation of the Company’s equity utilizing the application of significant estimates, assumptions, and judgments, as further described in Note 4. For the Predecessor PSU awards, the Company generally used the Monte Carlo model to estimate the probability of satisfying the performance criteria and the resulting fair value. The assumptions used in the Monte Carlo model for PSUs granted during the period December 31, 2022 through November 14, 2023 (Predecessor) and the period June 17, 2022 through December 30, 2022 (Predecessor) were as follows:



	Period from December 31, 2022 through November 14, 2023		Period from June 17, 2022 through December 30, 2022
Expected stock price volatility	40.1	%	38.9	%
Peer group stock price volatility	124.7		128.0
Correlation of returns	23.8		24.4

The weighted-average grant-date fair value per share of PSUs granted during the fiscal year ended December 27, 2024 (Successor) was $48.19. As of December 27, 2024 (Successor), there was $8.0 million of unrecognized compensation costs related to PSUs, which is expected to be recognized over a weighted-average period of 2.0 years.