LIFECORE BIOMEDICAL, INC. \DE\

13. Stock-based compensation

The Company provides stock-based compensation to its employees undertwo plans:

•The 2019 Stock Incentive Plan became effective on October 16, 2019. This plan provides for the grant of stock options, stock grants, stock units and stock appreciation rights to employees, consultants and directors. Under the plan, no recipient may receive awards during any fiscal year that exceed 500,000 stock options,250,000 stock grants or stock units, or 500,000 stock appreciation rights, nor may any non-employee director be granted awards in excess of $120. As of February 23, 2025, the Company had 1,547,216 common shares reserved for new awards under the plan.

•The Equity Inducement Plan became effective on March 20, 2024. This plan provides for the grant of equity awards to individuals that were not previously employees or directors of the Company as an inducement material to the individual’s entry into employment with the Company. As of February 23, 2025, the Company had 336,374 common shares reserved for new awards under the plan.

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Most of the stock-based compensation expense arises from recent awards to ourtwo principal executive officers under the Equity Inducement Plan. Those awards include (i) an RSU award, a small portion of which vested immediately with the remainder vesting on each of the first five anniversaries of the grant date; and (ii) PSU awards divided intoten equal tranches that will vest, if at all, based upon closing stock price milestones over afive-year performance period, and to the extent a PSU award tranche vests based on performance,50% of the shares for each tranche will be issued immediately, and 50% of the shares will be issued on theone-year anniversary of the performance vesting date.

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 information about stock-based awards:

A summary of the activity under the Company’s stock option plans as of February 23, 2025 and changes during the fiscal quarter then ended is presented below:

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.

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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 ofone tothree years. All vesting is subject to continued service. Currently, the PSUs outstanding vest upon achievement of certain stock price hurdles and continued employment thereafter of our CEO and CFO. The PSUs have afive-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 RSU award activity and PSU award activity as of February 23, 2025 and changes during the fiscal quarter then ended is presented below.

Stock-based compensation expense

The following table summarizes stock-based compensation by income statement line item:

As of February 23, 2025, there was $12,473 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 2.1 years.