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Stock-based Compensation | 6 Months Ended
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Nov. 24, 2024
Share-Based Payment Arrangement [Abstract] |
Stock-based Compensation | Stock-based Compensation Stock-Based Compensation Activity The Company uses the Black-Scholes option pricing model to calculate the grant date fair value of stock option awards. The use of an option pricing model requires the Company to make estimates and assumptions, including the expected stock price volatility, expected life of option awards and risk-free interest rate which have a significant impact on the fair value estimates. The following table displays the estimated fair value of stock options granted and the weighted average assumptions utilized:
| Three Months Ended |  | Six Months Ended
| November 24, 2024 |  | November 24, 2024
Weighted-average grant date fair value | $2.13 |  | $2.33
Assumptions: |  |  |
Expected life (in years) | 4.35 |  | 4.35
Risk-free interest rate | 3.87% |  | 3.88%
Volatility | 52% |  | 53%
Dividend yield | —% |  | —%
A summary of the activity under the Company’s stock option plans as of November 24, 2024 and changes during the fiscal quarter then ended is presented below:
| Options Outstanding |  | Weighted-Average Exercise Price Per Share |  | Total Intrinsic Value of Options Exercised (in thousands) |  | Weighted-Average Remaining Contractual Term in Years |  | Aggregate Intrinsic Value (in thousands)
Options outstanding at May 26, 2024 | 2,112,591 |  |  | $ | 10.88 |  |  |  |  | 2.44 |  | $ | — |
Options granted | 95,525 |  |  | 5.00 |  |  |  |  |  |  |
Options exercised | — |  |  | — |  |  | $ | — |  |  |  |  |
Options forfeited | (30,488) |  |  | 9.16 |  |  |  |  |  |  |
Options expired | (272,066) |  |  | 12.09 |  |  |  |  |  |  |
Options outstanding at November 24, 2024 | 1,905,562 |  |  | 10.44 |  |  |  |  | 1.79 |  | $ | 214 |
Options exercisable at November 24, 2024 | 1,726,328 |  |  | 10.74 |  |  |  |  | 1.37 |  | 214 |
The intrinsic values presented in the table above were calculated as the excess, if any, of the market price or closing price of the Company’s common stock over the exercise price of the options multiplied by the number of options exercised, outstanding or exercisable, as applicable. RSUs are valued using the closing price of the Company’s common stock on their grant date and expensed ratably over the requisite vesting period of one to three years. All vesting is subject to continued service. A summary of the Company’s RSU award activity as of November 24, 2024 and changes during the fiscal quarter then ended is presented below:
| Restricted Stock Units Outstanding |  | Weighted-Average Grant Date Fair Value Per Share
RSUs outstanding at May 26, 2024 | 1,622,004 |  |  | $ | 7.83 |
Granted | 651,630 |  |  | 4.83 |
Vested | (588,366) |  |  | 8.32 |
Forfeited | (183,994) |  |  | 7.03 |
RSUs outstanding at November 24, 2024 | 1,501,274 |  |  | 6.43 |
Currently, the PSUs outstanding vest upon achievement of certain stock price hurdles and continued employment thereafter of our CEO. The PSUs have a 5-year term and any unvested awards at the end of the term will be forfeited. PSUs subject to market conditions are valued using a Monte Carlo simulation model and expensed on an accelerated attribution basis over the derived service period. If the stock price hurdles are not met, expense is not reversed as long as the requisite service period has been met. A summary of the Company’s PSU award activity as of November 24, 2024 and changes during the fiscal quarter then ended is presented below:
| Performance Share Units Outstanding |  | Weighted-Average Grant Date Fair Value Per Share
PSUs outstanding at May 26, 2024 | 1,500,000 |  |  | $ | 4.66 |
Granted | 750,000 |  |  | 3.36 |
Vested | (75,000) |  |  | 4.24 |
Forfeited | — |  |  | — |
PSUs outstanding at November 24, 2024 | 2,175,000 |  |  | 4.23 |
Stock-Based Compensation Expense The following table summarizes stock-based compensation by income statement line item:
| Three Months Ended |  | Six Months Ended
| November 24, 2024 |  | November 26, 2023 |  | November 24, 2024 |  | November 26, 2023
Cost of product sales | $ | 105 |  |  | $ | 178 |  |  | 247 |  |  | $ | 362 |
Research and development | (135) |  |  | 42 |  |  | (123) |  |  | 84 |
Selling, general and administrative | 3,402 |  |  | 1,357 |  |  | 5,667 |  |  | 2,664 |
Stock-based compensation expense | 3,372 |  |  | 1,577 |  |  | 5,791 |  |  | 3,110 |
Amount capitalized into property, plant, and equipment | — |  |  | 7 |  |  | — |  |  | 16 |
Total stock-based compensation costs | $ | 3,372 |  |  | $ | 1,584 |  |  | $ | 5,791 |  |  | $ | 3,126 |
As of November 24, 2024, there was $13,006 of total unrecognized compensation expense related to unvested equity compensation awards granted under the Lifecore incentive stock plans. This total expense is expected to be recognized over a weighted-average period of 2.16 years.

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