Common Stock and Stock-Based Compensation

6 Months Ended

Sep. 23, 2022

Share-Based Payment Arrangement [Abstract]

Common Stock and Stock-Based Compensation

The Company accounts for stock-based compensation through the measurement and recognition of compensation expense for share-based payment awards made to employees over the related requisite service period, including PSUs, RSUs and restricted shares (all part of our equity incentive plan).

During the six-month periods ended September 23, 2022 and September 24, 2021, the Company granted RSUs to employees of 2,144,417 and 960,031, respectively, with an estimated grant date fair value of $22.96 and $24.96, respectively. During the six-month periods ended September 23, 2022 and September 24, 2021, 1,070,849 and 64,583 shares vested, respectively, and 152,126 and 61,039 shares were cancelled, respectively. Stock-based compensation expense related to non-vested awards not yet recorded at September 23, 2022 was $46,164, which is expected to be recognized over a weighted-average of 1.53 years.

PSUs are included at 100% - 200% of target goals. The intrinsic value of the PSUs that were unvested during the six-month period ended September 23, 2022 was $63,476. A total of 855,916 and no shares vested during the six-month periods

ended September 23, 2022 and September 24, 2021, respectively. The total compensation cost related to unvested awards not yet recorded at September 23, 2022 was $25,750, which is expected to be recognized over a weighted average of 2.88 years.

During the six-month periods ended September 23, 2022 and September 24, 2021, 23,425 and 59,201, respectively, shares of the Company’s restricted common stock vested. No shares and 9,757 shares, respectively, were forfeited, which reduced common stock outstanding during the same periods. The Company had 117,101 unvested shares of restricted common stock at September 23, 2022 with a weighted average grant date fair value of $14.00 and remaining vesting period of 0.58 years.

The Company recorded stock-based compensation expense in the following expense categories of its unaudited condensed consolidated statements of operations:


	Three-Month Period Ended				Six-Month Period Ended
	September 23, 2022		September 24, 2021		September 23, 2022		September 24, 2021
Cost of sales	$	1,124	$	722	$	1,956	$	1,250
Research and development	1,711		1,043		2,839		1,795
Selling, general and administrative	5,369		4,431		37,545		7,982
Total stock-based compensation	$	8,204	$	6,196	$	42,340	$	11,027

During the first fiscal quarter of 2023, the Company’s (former) President and Chief Executive Officer, Ravi Vig, provided notice of his retirement from the Company and its board of directors (the “Board”), effective June 13, 2022. Additionally, the Company entered into a second amended and restated severance agreement (the “Second A&R Severance Agreement”) with Mr. Vig that amended and restated the amended agreement from September 30, 2020. As provided for in the Second A&R Severance Agreement, the Company agreed, in addition to other cash-settled and health insurance-related compensation, to modifications to Mr. Vig’s stock-based compensation, including: (i) acceleration of the vesting of all unvested RSUs, (ii) modification of certain PSUs with performance conditions that had been achieved as of the retirement date to permit these awards to remain outstanding and eligible to vest in accordance with their terms, and (iii) the forfeiture of certain unvested PSUs with performance conditions that had not been achieved as of the retirement date and replacement thereof with new immediately vesting RSUs. The impact of these modifications on stock-based compensation expense was $26,349 for the six-month period ended September 23, 2022, which was recorded in selling, general and administrative expense in the Company’s unaudited condensed consolidated statements of operations.