Stock-Based Compensation

3 Months Ended

Mar. 29, 2024

Share-Based Payment Arrangement [Abstract]

Stock-Based Compensation

Note 8. Stock-Based Compensation

On April 12, 2021, the Company’s Board approved the Company’s 2021 Stock Plan (the “2021 Stock Plan”). The 2021 Stock Plan reserves 5,477,200 of the Company’s shares for issuance of incentive instruments, including Incentive Stock Options (“ISOs”), Non-statutory Stock Options, Stock Appreciation Rights, Restricted Stock Awards, and Restricted Stock Unit Awards. ISOs granted under the Plan have a term of 10 years and vest over four years of service.

On November 13, 2023, the Company’s Board approved the Shimmick Corporation 2023 Equity Incentive Plan (the “2023 Omnibus Incentive Plan”). 3,729,149 is the maximum aggregate number of shares of Common Stock available under the 2023 Omnibus Incentive Plan (equal to ten percent (10%) of the Company’s Common Stock outstanding immediately following the completion of the Company’s IPO on November 16, 2023 plus (ii) the reserved and authorized shares for awards under the Company’s 2021 Stock Plan that were not granted as of November 13, 2023). The maximum aggregate number of shares of Common Stock that may be issued under the 2023 Omnibus Incentive Plan will automatically increase annually on the first day of each fiscal year, beginning with the 2024 fiscal year in an amount equal to five percent (5%) of Common Stock outstanding on the last day of the immediately preceding fiscal year unless the plan administration determines that a lesser amount should instead be issued. The shares reserved under the 2023 Omnibus Incentive Plan are for issuance of incentive instruments, including stock options, restricted stock awards, restricted stock units, stock appreciation rights, performance units and other share-based awards.

Total compensation expense related to stock-based grants was $1 million for each of the three months ended March 29, 2024 and March 31, 2023. Unrecognized compensation expense related to stock-based grants to employees of Shimmick outstanding as of March 29, 2024 and March 31, 2023 was $5 million and $4 million, respectively, to be recognized on a straight-line basis over the awards’ weighted average remaining vesting period of 1.1 years and 2.0 years, respectively.

For the three months ended March 29, 2024, stock option activity was as follows:

	Stock Options
	Number of shares			Weighted average exercise price per share		Weighted average grant date fair value		Weighted average years of remaining contractual term
Outstanding as of December 29, 2023		4,137,183		$	1.26	$	—		7.6
Exercised		(195,864	)		1.26		0.66		—
Forfeited & expired		(200,415	)		1.26		0.66		—
Outstanding as of March 29, 2024		3,740,904			1.26		0.66		7.1
Exercisable as of March 29, 2024		2,662,487		$	1.26	$	0.66		7.1

The following table summarizes the activities for unvested Shimmick restricted stock units for the three months ended March 29, 2024:

	Restricted Stock Units
	Number of shares			Weighted average grant date fair value
Unvested as of December 29, 2023		576,714		$	6.49
Awarded		12,097			6.20
Forfeited		(3,049	)		6.56
Outstanding as of March 29, 2024		585,762			6.48
Ended vested as of March 29, 2024		39,683			6.56
Ended unvested as of March 29, 2024		546,079		$	6.47