What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2026-05-06 compared with 2025-11-06 · 205 added, 250 removed, 460 unchanged (50% of the section changed)

Financial statements (unaudited)

Consolidated Balance Sheets as of September 30, 2025 and May 25, 2025

Consolidated Statements of Operations for the Three Months Ended September 30, 2025 and August 25, 2024

Consolidated Statements of Convertible Preferred Stock and Stockholders’ Equity (Deficit) for the Three Months Ended September 30, 2025 and August 25, 2024

Consolidated Statements of Cash Flows for the Three Months Ended September 30, 2025 and August 25, 2024

Financial statements

Consolidated Balance Sheets as of March 31, 2026 and December 31, 2025

Consolidated Statements of Operations for the Three Months Ended March 31, 2026 and February 23, 2025

Consolidated Statements of Convertible Preferred Stock and Stockholders’ Equity (Deficit) for the Three Months Ended March 31, 2026 and February 23, 2025

Consolidated Statements of Cash Flows for the Three Months Ended March 31, 2026 and February 23, 2025

Notes to the Consolidated Financial Statements

8 unchanged sentences

12 Stock-based compensation

13 Income taxes

14 Fair value of financial instruments

2 unchanged sentences

CONSOLIDATED BALANCE SHEETS

(in thousands, except share and per share amounts) September 30,

ASSETS (unaudited)

(in thousands, except share and per share amounts) March 31,

2026 December 31,

Current assets:

Cash and cash equivalents $ 20,795 $ 17,469

Accounts receivable, net of allowance for credit losses of $ 804 and $ 1,351

Accounts receivable, net

10,674 13,233

Accounts receivable, related party 8,763 12,929

Current portion of note receivable

Contract assets 7,449 7,655

2 unchanged sentences

Total current assets 77,639 82,292

Property, plant and equipment, net of accumulated depreciation of $ 59,622 and $ 57,412

Property, plant and equipment, net

125,513 127,304

Goodwill 13,881 13,881

Intangible assets, net of accumulated amortization of $ 3,700

Other assets 8,466 8,700

3 unchanged sentences

Accounts payable $ 7,014 $ 6,211

Accrued expenses and other current liabilities, see note 7

Accrued expenses and other current liabilities

13,483 17,362

14 unchanged sentences

75,000,000 shares authorized;

37,466,352 and 37,026,234 shares issued and outstanding

37,477,386 shares issued and outstanding

Additional paid-in capital 209,706 208,962

Accumulated deficit ( 238,181 ) ( 223,201 )

Total stockholders’ (deficit) equity

Total stockholders’ deficit

( 28,438 ) ( 14,202 )

Total liabilities, convertible preferred stock and stockholders’ (deficit) equity

Total liabilities, convertible preferred stock and stockholders’ deficit

$ 225,499 $ 232,177

4 unchanged sentences

(in thousands, except share and per share amounts)

September 30,

2025 August 25,

2026 February 23,

Revenues $ 14,236 $ 16,233

1 unchanged sentence

Total revenues 23,193 35,154

Cost of goods sold 23,318 19,318

Cost of sales

18,731 25,309

Gross profit 4,462 9,845

1 unchanged sentence

Selling, general, and administrative expenses 7,917 9,978

Loss on sale or disposal of assets, net of portion classified as cost of sales

Operating loss

5 unchanged sentences

Change in fair value of debt derivative liability, related party ( 3,155 ) ( 600 )

Other income (expense), net

Other income, net

Loss before income taxes

3 unchanged sentences

Preferred stock dividends

( 907 ) ( 837 )

Accretion of preferred stock to redemption value

( 47 ) ( 48 )

Loss available to common stockholders

12 unchanged sentences

(dollars in thousands) Shares Amount Shares Amount

Balance at June 30, 2025 45,736 $ 46,402 37,026,234 $ 37 $ 207,206 $ ( 208,104 ) $ ( 861 )

Balance at December 31, 2025 47,466 $ 48,262 37,477,386 $ 37 $ 208,962 $ ( 223,201 ) $ ( 14,202 )

Dividends paid-in-kind 890 907 — — ( 907 ) — ( 907 )

Accretion to redemption value — 47 — — ( 47 ) — ( 47 )

( 1 ) ( 1 ) 154 — 1 — 1

Settlement of stock-based awards — — 439,964 — ( 1,156 ) — ( 1,156 )

Stock-based compensation — — — — 1,698 — 1,698

— — — — — ( 14,980 ) ( 14,980 )

Balance at September 30, 2025 46,593 $ 47,323 37,466,352 $ 37 $ 207,521 $ ( 218,095 ) $ ( 10,537 )

Balance at May 26, 2024 42,461 $ 42,587 30,562,961 $ 31 $ 177,807 $ ( 166,523 ) $ 11,315

Balance at March 31, 2026 48,356 $ 49,216 37,477,386 $ 37 $ 209,706 $ ( 238,181 ) $ ( 28,438 )

Balance at November 24, 2024 44,068 $ 44,312 36,980,790 $ 37 $ 204,736 $ ( 189,324 ) $ 15,449

Issuance of stock, net of fees — — — — 16 — 16

5 unchanged sentences

— — — — — ( 14,769 ) ( 14,769 )

Balance at August 25, 2024 43,257 $ 43,441 30,898,255 $ 31 $ 178,783 $ ( 182,753 ) $ ( 3,939 )

Balance at February 23, 2025 44,894 $ 45,197 37,025,331 $ 37 $ 206,285 $ ( 204,093 ) $ 2,229

See accompanying notes to the consolidated financial statements.

3 unchanged sentences

(in thousands)

September 30,

2025 August 25,

2026 February 23,

Cash flows from operating activities:

$ ( 14,980 ) $ ( 14,769 )

Adjustments to reconcile net loss to net cash provided by (used in) operating activities:

Depreciation and amortization 1,981 1,993

Adjustments to reconcile net loss to net cash provided by operating activities:

Stock-based compensation 1,698 2,552

1 unchanged sentence

Change in fair value of debt derivative liability, related party

Loss on sale or disposal of assets

Other, net ( 46 ) 333

7 unchanged sentences

Accrued expenses and other liabilities ( 3,652 ) 225

Net cash provided by (used in) operating activities

1,762 ( 613 )

Net cash provided by operating activities

Cash flows from investing activities:

Purchases of property, plant, and equipment ( 1,118 ) ( 5,456 )

Net cash used in investing activities

Proceeds from sale of equipment

Net cash (used in) provided by investing activities

( 1,118 ) 1,544

Cash flows from financing activities:

Issuance of common stock, net of fees — 1

Payments on revolving credit facility

2 unchanged sentences

36,400 27,893

Payments of debt principal ( 232 ) ( 233 )

Payments related to employee stock plans — ( 134 )

Net cash (used in) provided by financing activities

Other financing activities

( 256 ) ( 649 )

Net decrease in cash and cash equivalents

Net cash used in financing activities

( 256 ) ( 6,783 )

Net increase (decrease) in cash and cash equivalents

3,326 ( 4,040 )

Cash and cash equivalents, beginning of period 17,469 9,455

Cash and cash equivalents, end of period $ 20,795 $ 5,415

For supplemental cash flow information, see note 1.

See accompanying notes to the consolidated financial statements.

See accompanying notes to the consolidated financial statements, including note 1 for supplemental cash flow information

LIFECORE BIOMEDICAL, INC.

6 unchanged sentences

Basis of presentation

The accompanying unaudited consolidated financial statements of the Company and the consolidated balance sheet as of May 25, 2025, which has been derived from audited financial statements, have been prepared in accordance with U.S.

The accompanying unaudited consolidated financial statements of the Company have been prepared in accordance with U.S.

Generally Accepted Accounting Principles (“U.S.

GAAP”) for interim financial information, the instructions for Form 10-Q and Regulation S-X of the Securities and Exchange Commission (the “SEC”).

In the opinion of management, all adjustments (which were of a normal recurring nature) have been made which are necessary to present fairly the financial position of the Company at September 30, 2025, and the results of operations and cash flows for all periods presented.

In the opinion of management, all adjustments (which were of a normal recurring nature) have been made which are necessary to present fairly the financial position of the Company at March 31, 2026, and the results of operations and cash flows for all periods presented.

Although the Company believes that the disclosures in these financial statements are adequate to make the information presented not misleading, certain information normally included in the notes to the financial statements prepared following U.S.

GAAP may have been condensed or omitted per the rules and regulations of the SEC.

The accompanying financial data should be reviewed in conjunction with the audited financial statements and accompanying notes included in the Company’s Annual Report on Form 10-K for the fiscal year ended May 25, 2025.

The accounting policies underlying the accompanying consolidated financial statements are set forth in note 1 to the consolidated financial statements included in the Company’s Annual Report on Form 10-K for the fiscal year ended May 25, 2025.

There have been no material changes in the Company’s significant accounting policies during the three months ended September 30, 2025.

On August 1, 2025, the Company’s Board of Directors approved a change in the Company’s fiscal year that ended on the last Sunday of May to a fiscal year that corresponds with the calendar year, ending on December 31, effective for the fiscal period beginning May 26, 2025 and ending December 31, 2025 (the “Fiscal Year Change”).

The Fiscal Year Change is applied on a prospective basis and does not adjust operating results for prior periods.

As a result of the Fiscal Year Change, commencing with this Quarterly Report on Form 10-Q, the Company will be filing Quarterly Reports on Form 10-Q covering quarterly periods on a calendar year basis.

Also as a result of the Fiscal Year Change, the Company will file a Form 10-KT covering the “transition period” beginning May 26, 2025 and ending December 31, 2025, which will include separate reporting of the approximately one-month period from May 26 to June 30, 2025.

For periodic reports covering periods through and including June 30, 2026 (including this Quarterly Report on Form 10-Q), the Company will select comparative financial information in accordance with SEC rules that are applicable to the Fiscal Year Change.

Specifically, for balance sheet information, the Company will present information from the latest audited date, which for this Quarterly Report on Form 10-Q is May 25, 2025;

and for period-based information, the Company will present the most closely-comparable previously reported three-month period, which for this Quarterly Report on Form 10-Q is the three months ended August 25, 2024.

This comparative information is selected to provide meaningful context for evaluating the Company’s performance through and including June 30, 2026.

The accompanying financial data should be reviewed in conjunction with the audited financial statements and accompanying notes included in the Company’s Transition Report on Form 10-KT for the transition period ended December 31, 2025.

The accounting policies underlying the accompanying consolidated financial statements are set forth in note 1 to the consolidated financial statements included in the Company’s Transition Report on Form 10-KT for the transition period ended December 31, 2025.

There have been no material changes in the Company’s significant accounting policies during the three months ended March 31, 2026.

On August 1, 2025, the Company’s Board of Directors approved a change in the Company’s fiscal year from a fiscal year ending on the last Sunday of May to a calendar year (the “Fiscal Year Change”).

Since September 30, 2025, the Company has been reporting calendar periods in its quarterly periodic reports.

In accordance with SEC rules, the Company is presenting current period results compared to the most closely-comparable previously-reported three-month period through June 30, 2026.

For this report, the most closely-comparable previously-reported period is the three-month period ended February 23, 2025.

It is not practicable or cost-justifiable for the Company to prepare equivalent calendar-based comparative periods because the Company’s previous fiscal calendar does not align to the new calendar periods.

Beginning September 30, 2026, the Company will provide calendar-based comparative periods.

Certain prior period amounts have been reclassified to conform to the current period’s presentation.

5 unchanged sentences

GAAP requires management to make estimates and judgments that affect the amounts reported.

The accounting estimates that require management’s most significant and subjective judgments include revenue recognition;

recognition and measurement of current and deferred income tax assets and liabilities;

The accounting estimates that require management’s most significant and subjective judgments include revenue recognition for development services;

the establishment of valuation allowances on deferred income tax assets;

evaluating assets for reserves and potential impairment;

the valuation and recognition of stock-based compensation;

and the valuation of the debt derivative liability.

3 unchanged sentences

Three months ended

September 30, 2025 August 25, 2024

Cash paid for income taxes, net

2026 February 23, 2025

Cash paid for interest $ 265 $ 588

1 unchanged sentence

Purchases of property, plant and equipment in accounts payable

Non-cash portion of sale of property, plant and equipment via note receivable

Capitalization of non-cash interest to property, plant and equipment

1 unchanged sentence

Recent accounting pronouncements

In December 2023, accounting standards update 2023-09 was issued to improve income tax disclosures.

This update includes disclosure of disaggregated information about both the effective tax rate reconciliation and income taxes paid.

This update is effective for annual periods beginning after December 15, 2024, which for Lifecore begins with the transition period ending December 31, 2025, with early adoption permitted.

The amendments in this update may be applied prospectively or retrospectively.

Management is currently evaluating the impact that the adoption of this update will have on its financial statements.

In November 2024, accounting standards update 2024-03, which was subsequently clarified by accounting standards update 2025-01, was issued to require more detailed disclosures related to certain costs and expenses.

In November 2024, the Financial Accounting Standards Board (“FASB”) issued accounting standards update 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40):

Disaggregation of Income Statement Expenses , which was subsequently clarified by accounting standards update 2025-01, to require more detailed disclosures related to certain costs and expenses.

The guidance requires entities to disclose amounts of certain expense categories included in expense captions presented on the face of the income statement, including purchases of inventory, employee compensation, depreciation, and intangible asset amortization.

1 unchanged sentence

Management is currently evaluating the impact that the adoption of this update will have on its financial statements.

In September 2025, accounting standards update 2025-06 was issued to modernize the recognition and disclosure framework for internal-use software costs, removing the previous "development stage" model and introducing a more judgment-based approach.

In September 2025, the FASB issued accounting standards update 2025-06, Targeted Improvements to the Accounting for Internal-Use Software , to modernize the recognition and disclosure framework for internal-use software costs, removing the previous “development stage” model and introducing a more judgment-based approach.

This guidance is effective for annual periods beginning after December 15, 2027, which for Lifecore begins with the year ending December 31, 2028, and interim periods therein.

7 unchanged sentences

Three months ended

September 30, 2025 August 25, 2024

2026 February 23,

Redeemable Convertible Preferred Stock

8 unchanged sentences

Three months ended

September 30, 2025 August 25, 2024

2026 February 23,

$ 23,193 $ 35,154

2 unchanged sentences

Materials and non-depreciation overhead (2)

Depreciation and amortization

Stock-based compensation

Reorganization costs

Loss on sale or disposal of assets

All other operating expenses (3)

1 unchanged sentence

Change in fair value of debt derivative liability 3,155 600

Other (income) expense, net

Other income, net

( 110 ) ( 333 )

Income tax expense (benefit)

1 unchanged sentence

(1) Includes all wages and salary, bonus, employer taxes, and employee benefit plan expenses

(2) Represents cost of goods sold, excluding direct labor and all personnel cost and depreciation allocations

(2) Represents cost of sales, excluding direct labor and all personnel cost and depreciation allocations

(3) Includes expenses for accounting, legal and other professional services, software licensing, insurance costs, public company costs and board fees.

For the three months ended September 30, 2025, the Company earned revenue of approximately 60 % in the United States, 20 % in Belgium, 10 % in the Netherlands and 10 % in all other countries combined.

For the three months ended August 25, 2024, the Company earned revenue of approximately 65 % in the United States, 10 % in Belgium, 10 % in the Netherlands and 15 % in all other countries combined.

For the three months ended March 31, 2026, the Company earned revenue of approximately 90 % in the United States and 10 % in all other countries combined.

For the three months ended February 23, 2025, the Company earned revenue of approximately 55 % in the United States, 30 % in Belgium and 15 % in all other countries combined.

Accounts and note receivable

Accounts receivable

Three of the Company’s customers had accounts receivable concentrations of 10% or greater as of September 30, 2025, with those customers comprising 28 %, 19 % and 17 % of accounts receivable.

Two of the Company’s customers had accounts receivable concentrations of 10% or greater as of May 25, 2025, with those customers comprising 45 % and 16 % of accounts receivable.

Two of the Company’s customers had accounts receivable concentrations of 10% or greater as of March 31, 2026, with those customers comprising 44 % and 16 % of accounts receivable.

Two of the Company’s customers had accounts receivable concentrations of 10% or greater as of December 31, 2025, with those customers comprising 48 % and 10 % of accounts receivable.

Changes in the allowance for credit losses related to accounts receivable are as follows:

Three months ended

September 30, 2025 August 25, 2024

2026 February 23,

Beginning balance $ 1,044 $ 561

Provision (reversal of provision)

Charge-offs ( 547 ) —

Ending balance

1 unchanged sentence

Note receivable

On January 7, 2025, the Company accepted a $ 10,000 note as a portion of the proceeds from the sale of certain excess equipment.

The note would have matured on July 7, 2026 and was receivable in whole or in part at any time prior to maturity without penalty or premium.

Otherwise, the note was scheduled to be collected as follows:

On January 7, 2025, the Company accepted a $ 10,000 note as a portion of the proceeds from the sale of certain excess equipment described in note 6.

The note would have matured on July 7, 2026 and was payable by the note holder in whole or in part at any time prior to maturity without penalty or premium.

Otherwise, it was scheduled to be collected as follows:

$ 4,000 on July 7, 2025, $ 4,000 on January 7, 2026 and $ 2,000 on July 7, 2026.

1 unchanged sentence

prime rate plus 1 % until repayment.

Management imputed interest for the full duration of the note at an effective interest rate of 8.5 %, representing the stated rate as of February 23, 2025.

As a result, the Company recorded an initial discount of $ 410 as an offset to the noncurrent portion of the note based on its maturity date.

On June 11, 2025, the note holder paid the note in full.

Management concluded that interest should have been imputed for the full duration of the note at an effective interest rate of 8.5 %, representing the stated rate.

As a result, the Company recorded an initial discount of $ 410 as an offset to the noncurrent portion of the note based on its maturity date at that time.

In June 2025, the note holder paid the note in full.

The following table presents the components of inventory:

September 30, 2025 May 25,

2026 December 31,

Finished goods $ 4,597 $ 11,845

5 unchanged sentences

The following table presents the components of property, plant and equipment:

September 30, 2025 May 25,

2026 December 31,

Land and land improvements $ 3,491 $ 3,491

4 unchanged sentences

Construction in process 7,839 9,539

Idle construction in process

Property, plant, and equipment, gross 186,131 186,464

accumulated depreciation and amortization

accumulated depreciation

( 60,618 ) ( 59,160 )

Property, plant, and equipment, net $ 125,513 $ 127,304

During the three months ended September 30, 2025, the Company completed its capacity expansion project which is expected to more than double its overall aseptic capacity.

As a result of the completion of the capacity expansion project, depreciation expense is expected to increase by approximately $ 1,600 per annum.

On January 7, 2025, the Company entered into an agreement for the sale of certain excess equipment.

4 unchanged sentences

The sale resulted in a $ 21,239 reduction in idle construction in process.

The Company recorded a loss on the sale of the equipment of $ 6,400 , which is included with other losses for the fiscal year ended May 25, 2025 , respectively, in loss on sale or disposal of assets, net of portion classified as cost of sales, within the statement of operations.

Depreciation and amortization expense for property, plant, and equipment for the three months ended September 30, 2025 and August 25, 2024 was $ 1,981 and $ 1,993 , respectively.

The Company recorded a loss on the sale of the equipment of $ 6,400 , which is included in loss on sale or disposal of assets, net of portion classified as cost of sales, within the statement of operations.

Depreciation expense for property, plant and equipment for the three months ended March 31, 2026 and February 23, 2025 was $ 2,310 and $ 2,076 , respectively.

Accrued expenses and other current liabilities

The following table presents the components of accrued expenses and other current liabilities:

September 30, 2025 May 25,

Accrued payable to Redeemable Convertible Preferred Stockholders $ 4,664 $ 4,499

2026 December 31,

Accrued compensation

$ 4,221 $ 4,548

Contract liabilities, related party

Contract liabilities 1,503 3,018

Accrued professional fees 871 1,444

Current portion of debt, related party 773 773

Current portion of debt 189 181

Accrued customer pass-through expenditures — 1,911

Accrued expenses and other current liabilities $ 13,483 $ 17,362

2 unchanged sentences

The Company makes a provision for a liability relating to legal matters when it is both probable that a liability has been incurred and the amount of the loss can be reasonably estimated.

These provisions are reviewed at least each fiscal quarter and adjusted to reflect the impacts of negotiations, estimated settlements, legal rulings, advice of legal counsel and other information and events pertaining to a particular matter.

These provisions are reviewed at least each quarter and adjusted to reflect the impacts of negotiations, estimated settlements, legal rulings, advice of legal counsel and other information and events pertaining to a particular matter.

Legal fees are expensed in the period in which they are incurred.

2 unchanged sentences

(“22NW”), a holder of shares of the Company’s Common Stock and Series A Redeemable Convertible Preferred Stock (see note 10), filed a complaint against the Company, two former officers, and five former or current directors in the Commercial Division of the Supreme Court of the State of New York, New York County.

The complaint seeks money damages (including compensatory damages, court costs, and attorneys’ fees) for (i) alleged material misrepresentations by the Company on which 22NW allegedly relied when purchasing shares of the Series A Redeemable Convertible Preferred Stock and Common Stock, (ii) alleged breaches of certain express representations in the stock purchase agreement through which 22NW acquired its shares, and (iii) registration delay fees owed under a registration rights agreement entered into in connection with the issuance of the Series A Redeemable Convertible Preferred Stock.

The complaint also seeks the equitable remedy of specific performance under the aforementioned stock purchase agreement, requesting an order compelling the Company to file a proxy statement with the SEC and to hold a stockholder meeting to seek the approval of the removal of the current cap on the conversion of Series A Redeemable Convertible Preferred Stock into Common Stock as set forth in the Certificate of Designations related to the Redeemable Convertible Preferred Stock.

On February 24, 2025, the Company filed a motion to dismiss all claims against it except for the claims relating to the registration delay fees.

The individual defendants filed separate motions to dismiss the complaint against them in its entirety.

Those motions were fully briefed on April 9, 2025, and the Court held a hearing on the motions in early November 2025.

Discovery is ongoing.

The Company intends to vigorously defend itself and its former officers and directors in this action.

Any potential loss arising from these claims is not currently probable or estimable.

However, the Company has been accruing for the registration delay fees sought by 22NW (see note 10 for additional information, including with respect to the payment in full of this obligation in November 2025).

The Company also held a Special Meeting of Stockholders on April 10, 2025, at which time the stockholders approved the removal of the cap on the conversion of Series A Redeemable Convertible Preferred Stock into Common Stock.

The complaint also seeks the equitable remedy of specific performance under the aforementioned stock purchase agreement, requesting an order compelling the Company to file a proxy statement with the Securities and Exchange Commission (“SEC”) and to hold a stockholder meeting to seek the approval of the removal of the current cap on the conversion of Series A Redeemable Convertible Preferred Stock into Common Stock as set forth in the Certificate of Designations related to the Redeemable Convertible Preferred Stock, which the Company has since satisfied.

On February 24, 2025, the Company filed a motion to dismiss all claims against it except for the claims relating to the registration delay fees, which the Company subsequently paid to 22NW in full in November 2025.

On that same day, the individual defendants also filed a separate motion to dismiss the complaint against them in its entirety.

On April 22, 2026, the Court granted the Company’s motion to dismiss in part and the individual defendants’ motion to dismiss in its entirety.

With respect to the Company, all but two claims were dismissed:

the claim for alleged breaches of certain express representations in the Series A stock purchase agreement and the claim for failure to pay registration delay fees.

At the prior oral argument on the motions, 22NW’s counsel agreed on the record that the registration delay fees claim was mooted by the Company’s prior payments.

The Company intends to vigorously defend itself against these remaining claims.

Any potential remaining loss arising from these claims is not currently probable or estimable.

Class action complaint

6 unchanged sentences

In November 2025, the Company and individual defendants entered into an agreement in principle with the plaintiffs to settle this matter, without any admission of wrongdoing, which is subject to court approval.

If approved by the court in its current form, this proposed settlement is expected to be covered by the Company’s insurance policies with no material loss incurred by the Company.

On March 13, 2026, the Court granted preliminary approval of the proposed settlement, and the final approval hearing has been scheduled for late July 2026.

If final approval of the proposed settlement is granted by the court in its current form, this settlement is expected to be covered by the Company’s insurance policies with no material loss incurred by the Company.

The Company continues to believe that the claims are without merit and intends to vigorously defend against them if the settlement is not so approved.

On February 16, 2024, the Chicago Regional Office of the SEC issued a subpoena to the Company seeking documents and information concerning the financial statement restatement.

The Company has cooperated with the SEC.

The Company cannot predict the duration or outcome of this matter at this time.

The Company cooperated with the SEC during its review of the matter.

On March 9, 2026, the Company received notice from the SEC’s Division of Enforcement that it had concluded its investigation with no action taken against the Company.

Yucatan litigation

13 unchanged sentences

The Plaintiff’s new lawsuit arises out of the same allegations as his earlier lawsuit, asserts the same claims, and seeks the same damages.

The Company will oppose the new complaint and seek to dismiss on the grounds it is duplicative of the first lawsuit.

The Company’s motion to dismiss the new complaint on the grounds it is duplicative of the first lawsuit was denied by the trial court, but the Company appealed the trial court’s decision on February 17, 2026.

The ultimate outcome of these matters or any other investigations, legal actions, or potential claims that may arise from these matters remains uncertain.

The Company cannot reasonably predict the timing or outcomes, or estimate the amount of final judgments, or the effect, if any, they may have on its financial statements.

Separately, future rulings from the Court will affect pending claims against the severed defendants for indemnification under provisions in the purchase agreement.

Because recovery of amounts is still contingent upon the resolution of certain issues, no amounts have been recorded as recoverable costs through September 30, 2025.

Separately, future rulings from the Court will affect pending claims against the severed defendants for indemnification under provisions in the purchase agreement for the Yucatan Acquisition.

Because recovery of amounts is still contingent upon the resolution of certain issues, no amounts have been recorded as recoverable costs through March 31, 2026.

The following table presents the components of debt:

September 30, 2025 May 25,

2026 December 31,

Debt principal:

Term loan credit facility with related party $ 188,627 $ 184,087

Revolving credit facility — 2,500

Leaseback liability with related party 5,604 5,798

8 unchanged sentences

Total debt, net of discounts $ 148,741 $ 142,236

The following table presents future minimum principal payments at September 30, 2025:

The following table presents future minimum principal payments at March 31, 2026:

Remainder of 2026

3 unchanged sentences

Three months ended

September 30, 2025 August 25, 2024

2026 February 23,

Expensed in statement of operations

1 unchanged sentence

Total interest incurred $ 7,373 $ 6,387

As of September 30, 2025, the Company was in compliance with all financial covenants under the Term Loan Credit Facility and Revolving Credit Facility.

As of March 31, 2026, the Company was in compliance with all financial covenants under the Term Loan Credit Facility and Revolving Credit Facility.

Term Loan Credit Facility

2 unchanged sentences

This facility has been amended from time to time, including for the purpose of (i) enhancing and clarifying certain reporting requirements;

(ii) providing limited waivers of potential events of default and permitting the Company to retain cash proceeds from the recent sale of the isolator-filler (see note 6);

(ii) providing limited waivers of potential events of default and permitting the Company to retain cash proceeds from the recent sale of certain excess equipment (see note 6);

and (iii) most recently, on November 6, 2025, making certain changes to reporting requirements to correspond to the Fiscal Year Change and providing the Company with flexibility regarding the investment of excess cash and alignment on making certain third party payments.

The Company initially made $ 142,270 of term loan borrowings under the facility.

The term loans bear interest at a fixed rate of 10 % per annum payable-in-kind until the third anniversary of the closing date, following which interest is payable at a fixed rate of 3 % per annum in cash with the remainder payable-in-kind.

The term loans bear interest at a fixed rate of 10 % per annum payable-in-kind until May 22, 2026, following which interest is payable at a fixed rate of 3 % per annum in cash with the remainder payable-in-kind.

The Company may elect to pay any amount of interest in cash instead of in-kind.

7 unchanged sentences

The Term Loan Credit Facility contains one financial covenant, a minimum liquidity covenant, requiring $ 4,000 of Consolidated Liquidity (as defined in the Term Loan Credit Facility) as of the end of each quarter.

As of September 30, 2025, the Company’s effective annual interest rate under the Term Loan Credit Facility was 20.9 %.

As of March 31, 2026, the Company’s effective annual interest rate under the Term Loan Credit Facility was 20.9 %.

Borrowings are guaranteed and secured by substantially all of the Company’s consolidated assets.

11 unchanged sentences

The monthly borrowing base is determined using specified percentages of qualifying accounts receivable and inventory that serve as collateral under the facility, net of reserves.

As of September 30, 2025, the Company's borrowing base was $ 23,600 , and the Company had no ordinary borrowings under this tranche.

As of March 31, 2026, the Company's borrowing base was $ 17,300 , and the Company had no outstanding borrowings.

These borrowings, when outstanding, bear interest based on an average daily SOFR rate plus a spread of 2.00 % to 2.50 % per annum based on average availability.

The facility also bears a commitment fee on unused availability of 0.375 % per annum.

Average borrowings under the facility were no t material for the three months ended September 30, 2025.

For the three months ended August 25, 2024, average borrowings were $ 19,535 and the weighted average interest rate on those borrowings was 10.9 %.

The facility also bears a commitment fee on the unused portion of the maximum committed amount of 0.375 % per annum.

Average borrowings under the facility were no t material for the three months ended March 31, 2026.

For the three months ended February 23, 2025, average borrowings were $ 4,500 and the weighted average interest rate on those borrowings was 8.72 %.

Borrowings are guaranteed and secured by substantially all of the Company’s consolidated assets.

12 unchanged sentences

The Company is generally not permitted to pay cash dividends to common stockholders due to restrictions arising from the Term Loan Credit Facility, the Revolving Credit Facility and the Redeemable Convertible Preferred Stock, as defined below.

On October 3, 2024, the Company entered into a Securities Purchase Agreement (the “Purchase Agreement”) with certain entities.

Pursuant to the Purchase Agreement, the Company agreed to sell an aggregate of 5,928,775 shares of its common stock (the “Shares”) for aggregate gross proceeds of approximately $ 24,300 (the “Offering”).

The purchase price for each Share was $ 4.10 .

The Offering closed on October 3, 2024.

The issuance costs of $ 467 were recorded as an offset to the Offering proceeds within additional paid-in capital.

The issuance of these common shares triggered an anti-dilution provision of the Redeemable Convertible Preferred Stock, resulting in a $ 2,132 adjustment to loss attributable to common stockholders.

This was determined by the additional 453,117 common shares the Preferred Stockholders could obtain upon conversion as of November 24, 2024, multiplied by the October 3, 2024 Lifecore closing stock price of $ 4.705 per share.

Redeemable Convertible Preferred Stock

On January 9, 2023, the Company issued 38,750 shares of Series A Convertible Preferred Stock, par value $ 0.001 per share, that is in certain cases redeemable at the option of the holder as discussed further below (the “Redeemable Convertible Preferred Stock”).

The Redeemable Convertible Preferred Stock is convertible into shares of Common Stock at the election of the holders of the Redeemable Convertible Preferred Stock.

On January 9, 2023, the Company issued 38,750 shares of Series A Convertible Preferred Stock, par value $ 0.001 per share, that is in certain cases redeemable for cash and/or convertible into shares of Common Stock at the election of the holders, each as discussed further below (the “Redeemable Convertible Preferred Stock”).

The Redeemable Convertible Preferred Stock ranks senior to the Common Stock with respect to dividends, distributions and payments on liquidation, winding-up and dissolution.

3 unchanged sentences

The holders are also entitled to participate in dividends declared or paid on the Common Stock on an as-converted basis.

At September 30, 2025, there were $ 874 of dividends in arrears that had not yet been paid-in-kind in the form of additional shares of Redeemable Convertible Preferred Stock, representing $ 12.50 per preferred share.

As of September 30, 2025 and May 25, 2025, the aggregate liquidation preference of the Redeemable Convertible Preferred Stock was $ 47,466 and $ 46,308 , respectively.

Each holder has the right, any time at its option, to convert its Redeemable Convertible Preferred Stock, in whole or in part, into fully paid and non-assessable shares of Common Stock at an initial conversion price equal to $ 7.00 per share.

The conversion price is subject to customary anti-dilution adjustments, including in the event of any stock split, stock dividend, recapitalization or similar events, and is also subject to adjustment in the event of subsequent offerings of Common Stock or convertible securities by the Company for less than the conversion price.

The issuance of 5,928,775 shares of Common Stock on October 3, 2024 triggered an adjustment to the conversion price to approximately $ 6.53 per share.

In addition, in April 2025, the Company held a Special Meeting of Stockholders at which stockholders approved the removal of the 19.99 % “exchange cap” on the issuance of Common Stock underlying the Redeemable Convertible Preferred Stock.

As of September 30, 2025, the Redeemable Convertible Preferred Stock was convertible into 7,131,888 shares of Common Stock.

The Company may also elect to convert the Redeemable Convertible Preferred Stock, subject to certain conditions, if, for at least 20 consecutive trading days during the respective measuring period, the Company's closing stock price equals or exceeds $ 10.50 per share.

Holders have the right to redeem the Redeemable Convertible Preferred Stock after the earlier of June 29, 2026 or the termination or waiver of the restriction on cash dividends and/or redemptions that is set forth in the Company’s credit agreements.

In the event that any holders exercise this right to redeem a portion or all of their holdings, the redemption date would be 180 days after providing such notice to the Company.

On such date the Company would be required to pay in cash an amount equal to the liquidation preference.

If the Company is unable to redeem all of the Redeemable Convertible Preferred Shares submitted for redemption, the Company would also be subject to interest on the unpaid balance at the rate of 1 % percent per month.

At March 31, 2026, there were $ 907 of dividends in arrears that had not yet been paid-in-kind in the form of additional shares of Redeemable Convertible Preferred Stock, representing $ 18.75 per preferred share.

As of March 31, 2026 and December 31, 2025, the aggregate liquidation preference of the Redeemable Convertible Preferred Stock was equal to the Conversion Amount (defined below) of $ 49,263 and $ 48,356 , respectively.

Each holder has the right, any time at its option, to convert its Redeemable Convertible Preferred Stock, in whole or in part, into an amount of fully paid and non-assessable shares of Common Stock equal to $ 1,000 per share of Redeemable Convertible Preferred Stock, plus accrued and unpaid dividends in arrears (the “Conversion Amount”), divided by the conversion price.

The initial conversion price of $ 7.00 per share was subsequently reduced to approximately $ 6.53 per share following the issuance of Common Stock for less than its conversion price in 2024.

The Redeemable Convertible Preferred Stock continues to be subject to customary anti-dilution adjustments, including in the event of any future stock split, stock dividend, recapitalization or similar events, and in the event of any subsequent offerings of Common Stock or convertible securities by the Company for less than the conversion price.

As of March 31, 2026, the Redeemable Convertible Preferred Stock was convertible into 7,540,464 shares of Common Stock.

The Company may also elect to convert the Redeemable Convertible Preferred Stock if, for at least 20 consecutive trading days during the respective measuring period, the Company's closing stock price equals or exceeds $ 10.50 per share and certain other conditions are satisfied.

Holders have the right to require the Company to redeem the Redeemable Convertible Preferred Stock beginning on June 29, 2026.

In the event that any holders exercise this right, the redemption date and payment of the redemption price would occur 180 days after such holders provide notice to the Company.

To make such cash redemption payments the Company would be required to obtain a consent to such cash redemption payments or waiver of the restriction on cash dividends and/or redemptions set forth in each of the Company’s credit agreements.

To the extent consents or waivers are not obtained under each of the Company’s credit agreements, the Company would be in breach thereof if such payments in cash were made.

On such date the Company would be required to pay in cash an amount equal to the Conversion Amount, which is $ 1,000 per share of Redeemable Convertible Preferred Stock to be redeemed plus accrued and unpaid dividends on such shares through the date of redemption.

If the Company does not redeem all of the Redeemable Convertible Preferred Shares submitted for redemption, the Company would also be subject to interest on the unpaid balance at the rate of 1 % per month.

In addition, the Redeemable Convertible Preferred Stock is also redeemable contingent upon the occurrence of certain events that may be outside of the control of the Company.

8 unchanged sentences

The agreement has no specified termination date and no specified maximum amount of penalties.

As of September 30, 2025, the Company had accumulated $ 5,199 o f monetary penalties and interest under the registration rights agreement.

The penalties accumulated because of delinquent filings of the Company’s annual and quarterly reports with the SEC, which caused the initial registration statement to cease to be effective.

In October 2024, the Company completed the necessary SEC filings to regain the effectiveness of the registration statement.

This caused monetary penalties to stop accruing.

Meanwhile, interest continues to accrue on the penalty amount at a rate of 12 % per annum until paid.

Penalties are recorded in other income or expense, net, and interest is recorded in interest expense on the consolidated statements of operations.

The Company initially paid $ 535 of these monetary penalties leaving a remaining obligation for penalties and interest of $ 4,664 as of September 30, 2025, which is included in accrued expenses and other current liabilities (see note 7).

In November 2025, the Company paid the remaining obligation in full.

The Company has paid a total of $ 5,238 pursuant to the registration rights agreement, including $ 4,703 in November 2025 due to a lapse in the effectiveness of the initial registration statement following the Company’s failure to timely file periodic reports with the SEC.

Revenue recognition

The Company disaggregates its revenue based on how it markets its products and services and reviews results of operations.

The following table disaggregates revenues by major product lines and services:

The following tables present disaggregated revenues:

Three months ended

September 30,

2025 August 25,

2026 February 23,

CDMO $ 15,775 $ 20,789

1 unchanged sentence

Total $ 23,193 $ 35,154

The following table disaggregates revenues by the timing of revenue recognition:

Three months ended

September 30,

2025 August 25,

Revenues recognized over time $ 4,223 $ 5,505

1 unchanged sentence

Total $ 23,193 $ 35,154

During the three months ended September 30, 2025, the Company had revenue concentrations of 10% or greater from two customers, with those customers comprising 38 % and 20 % of revenue.

During the three months ended August 25, 2024, the Company had revenue concentrations of 10% or greater from two customers, with those customers comprising 32 % and 24 % of revenue.

Contract assets primarily relate to the Company’s unconditional right to consideration for work completed but not billed at the reporting date.

Contract liabilities primarily relate to payments received from customers in advance of performance under a contract.

During the three months ended March 31, 2026, the Company had revenue concentrations of 10% or greater from two customers, with those customers comprising 39 % and 22 % of revenue.

During the three months ended February 23, 2025, the Company had revenue concentrations of 10% or greater from two customers, with those customers comprising 54 % and 18 % of revenue.

The following table presents changes in contract assets and liabilities:

Contract assets, current

Contract liabilities, current

Contract liabilities, noncurrent

Balance at June 30, 2025 $ 9,025 $ ( 5,195 ) $ ( 2,560 )

Changes to the comparative balance sheet amount arising from:

Contract assets

Contract liabilities

Balance at December 31, 2025 $ 7,655 $ ( 8,660 )

Changes to the beginning balance arising from:

Amounts billed as accounts receivable as the result of rights to consideration becoming unconditional

( 4,965 ) — —

Recognition of revenue as the result of performance obligations satisfied

Reclassification of scheduled satisfaction of performance obligations from noncurrent to current due to passage of time

Net change to contract balances recognized after the comparative balance sheet date due to amounts billed, recognition of revenue, changes in estimate, reclassifications from noncurrent to current, and interest from significant financing component

Net change to contract balances recognized after the comparative balance sheet date due to amounts billed, recognition of revenue, changes in estimate, and interest from significant financing component

4,861 ( 313 )

Balance at September 30, 2025 $ 4,385 $ ( 7,214 ) $ ( 1,168 )

Balance at March 31, 2026 $ 7,449 $ ( 5,864 )

Stock-based compensation

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

• The 2019 Stock Incentive Plan became effective on October 16, 2019.

• The 2019 Stock Incentive Plan is a seven-year plan that became effective upon stockholder approval at the Company’s 2019 Annual Meeting held on October 16, 2019 and has been subsequently amended with stockholder approval, most recently at the Annual Meeting held on August 15, 2024.

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 $ 350 .

As of September 30, 2025, the Company had 2,097,452 common shares reserved for new awards under the 2019 Stock Incentive Plan.

As of March 31, 2026, the Company had 1,504,798 common shares reserved for new awards under the 2019 Stock Incentive Plan.

The plan expires October 16, 2026.

The Company has submitted a replacement plan for approval by stockholders during the 2026 annual meeting scheduled for June 4, 2026.

• 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 September 30, 2025, the Company had 167,474 common shares reserved for new awards under the Equity Inducement Plan.

The following table presents information about the fair value of stock-based awards:

Stock options

As of March 31, 2026, the Company had 145,474 common shares reserved for new awards under the Equity Inducement Plan.

The following table presents information about stock options:

Three months ended

September 30, 2025 August 25, 2024

2026 February 23, 2025

Information about stock options granted:

Weighted-average grant date fair value per share $ 5.28 $ 4.68

$ 5.36 $ 3.38

Weighted-average assumptions used to determine grant-date fair value:

Expected life

4.3 years 4.4 years

Expected life 4.4 years 4.4 years

Risk-free interest rate 3.6 % 4.1 %

1 unchanged sentence

Dividend yield — % — %

The following table presents other information about stock-based awards:

There were no stock option exercises during either of the periods presented.

The following table presents information about other stock-based awards:

Three months ended

September 30, 2025 August 25, 2024

Weighted average grant-date fair value per share:

$ 7.72 $ 5.18

2026 February 23,

Weighted-average fair value per share as of transaction date:

RSUs granted $ 7.11 $ 7.25

RSUs vested — 9.26

The following table presents information about stock option balances and activity:

Shares Weighted-average exercise price per share Weighted-average remaining contractual term Aggregate intrinsic value

Outstanding at June 30, 2025 1,249,680 $ 8.48

Outstanding at December 31, 2025 1,377,054 $ 7.83

Granted 8,775 7.88

1 unchanged sentence

Expired ( 20,400 ) 10.62

Outstanding at September 30, 2025 1,152,621 8.22 5.0 years $ 465

Exercisable at September 30, 2025 448,178 10.46 2.8 years 15

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.

Outstanding at March 31, 2026 1,305,909 7.84 4.9 years $ —

Exercisable at March 31, 2026 538,481 9.47 3.2 years —

The following table presents information about recent RSU and PSU activity:

Shares Weighted-average grant date fair value per share Shares Weighted-average grant date fair value per share

Outstanding at June 30, 2025 1,523,137 $ 6.21 2,545,000 $ 4.35

Outstanding at December 31, 2025 1,440,419 $ 6.46 2,283,000 $ 4.25

Granted 451,780 7.11 — —

Vested ( 313,766 ) 5.94 ( 262,000 ) 5.24

Forfeited ( 64,538 ) 7.88 — —

Outstanding at September 30, 2025 1,377,482 6.46 2,283,000 4.25

Outstanding at March 31, 2026 1,827,661 6.57 2,283,000 4.25

Stock-based compensation expense

Substantially all of the stock-based compensation expense is in selling, general and administrative expense for the periods presented.

Most of the stock-based compensation expense arises from recent awards to the Company’s executive officers and other newly hired employees under the Equity Inducement Plan.

Those awards include (i) RSUs that primarily vest on each of the first five anniversaries of the grant date;

and (ii) PSU awards divided into ten equal tranches that will vest, if at all, based upon closing stock price milestones over a five-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 the one-year anniversary of the performance vesting date.

As of September 30, 2025, there was $ 12,214 of total unrecognized compensation expense related to unvested equity compensation awards granted under the Lifecore incentive stock plans.

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

Three months ended

2026 February 23,

Cost of sales

Research and development expense ( 242 ) —

Selling, general and administrative expense 1,724 2,368

Stock-based compensation expense $ 1,698 $ 2,552

Most of the stock-based compensation expense for the current period and going forward arises from RSU awards to the Company’s named executive officers under the Equity Inducement Plan and, to a lesser extent, to the Company’s directors.

The RSU awards to named executive officers are expensed ratably over the course of each year as awards vest on each of the first five anniversaries of the grant date, which was their date of hire.

The annual RSU awards to directors are expensed ratably over the course of each year in which they vest.

The Company has also issued PSU awards to its named executive officers, for which most of the expense has already been recognized through December 31, 2025.

These awards are divided into ten equal tranches that will vest, if at all, based upon closing stock price milestones over a five-year performance period, and to the extent a PSU award tranche vests based on stock price performance, 50 % of the shares for each tranche will be issued immediately, and 50 % of the shares will be issued on the one-year anniversary of the performance vesting date.

As of March 31, 2026, there was $ 12,354 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 2.0 years.

The effective tax rate was approximately negative 3 % for the three months ended September 30, 2025 and less than 1 % for the three months ended August 25, 2024.

The effective tax rate was less than 1 % for all periods presented.

The effective tax rates were lower than the U.S.

federal statutory tax rate in all periods primarily due to the Company’s valuation allowance on its deferred tax assets.

The One, Big, Beautiful Bill Act was signed into law in July 2025 and contains significant tax law changes with various effective dates, including a permanent extension of the 21% flat corporate income tax rate which was previously set to expire after 2025.

The Company will be impacted by changes to the timing of certain tax deductions including depreciation expense, research and development expenditures and interest expense.

The new tax laws caused a one-time acceleration of various tax deductions which did not result in income due to the establishment of valuation allowances on all deferred tax assets.

At the same time, that acceleration reduced deductions available to offset future deferred tax liabilities, resulting in a one-time estimated deferred tax expense of $ 255 for the three months ended September 30, 2025.

Fair value of financial instruments

1 unchanged sentence

The Term Loan Credit Facility contains various features that meet the definition of an embedded derivative and require bifurcation.

These features, which were necessary for the Company to accept in order for Alcon to agree to provide the term loan financing, comprise three options for early prepayment of the term loans at stated premiums above par if certain future events were to occur, as described more fully in note 9.

These features, which were necessary for the Company to accept in order for Alcon to agree to provide the term loan financing, comprise various options for early prepayment of the term loans at stated premiums above par if certain future events were to occur, as described more fully in note 9.

These embedded derivatives were initially recorded at fair value as a noncurrent liability (“debt derivative liability”) offset by a discount to the carrying value of the Term Loan Credit Facility that is being amortized to interest expense over the term of that facility.

The debt derivative liability is being subsequently remeasured at fair value every reporting period with changes in fair value recognized as a component of other expense, net.

The disclosed fair value of the term loan and the recorded fair value of the debt derivative liability are estimated using a discounted cash flow method (a level 3 measurement) that includes annually weighted probabilities that certain call and put premiums are exercised upon qualifying events of default or changes in control.

As of September 30, 2025, the fair value of the term loan, excluding the value of the embedded debt derivative liability, was $ 142,700 with a carrying value of $ 124,045 ;

The debt derivative liability is being subsequently remeasured at fair value every reporting period with changes in fair value reported as a non-operating item on the statement of operations.

The disclosed fair value of the term loan and the recorded fair value of the debt derivative liability are estimated using a discounted cash flow method (a level 3 measurement) that includes annually weighted probabilities that the lender exercises its option to require payment of the term loans upon a qualifying change in control or that the debt is held to maturity and refinanced.

As of March 31, 2026, the fair value of the term loan, excluding the value of the embedded debt derivative liability, was $ 142,700 with a carrying value of $ 137,306 ;

the fair value of the debt derivative liability was $ 29,719 , which was the same as its carrying value.

As of May 25, 2025, the fair value of the term loan, excluding the value of the embedded debt derivative liability, was $ 132,100 with a carrying value of $ 115,594 ;

As of December 31, 2025, the fair value of the term loan, excluding the value of the embedded debt derivative liability, was $ 149,400 with a carrying value of $ 130,563 ;

the fair value of the debt derivative liability was $ 26,564 , which was the same as its carrying value.

3 unchanged sentences

Level 1 Level 2 Level 3

Debt derivative liability Recurring September 30, 2025 — — 25,491

Debt derivative liability Recurring May 25, 2025 — — 24,991

Debt derivative liability Recurring March 31, 2026 — — 29,719

Debt derivative liability Recurring December 31, 2025 — — 26,564

The following table presents the rollforward reconciliation of this level 3 recurring fair value measurement:

Three months ended

September 30,

2025 August 25,

2026 February 23,

Balance at beginning of period $ 26,564 $ 23,300

Change in fair value 375 ( 900 )

Change in fair value recorded in earnings

Balance at end of period $ 29,719 $ 23,900

The key inputs to the valuation model are (i) the probability and timing of a change in control event occurring over the remaining term of the debt;

and (ii) the discount rate, which can be influenced by changes in the risk-free rate, the Company's credit rating and/or as changes in the overall credit market.

and (ii) the discount rate, which can be influenced by changes in the risk-free rate, the Company's credit rating and/or changes in the overall credit market.

Factors that can affect the estimate of fair value at each reporting date, and therefore the amount of gain or loss recorded for a particular period, include imprecision in estimating unobservable market inputs and the selection of particular methodologies and assumptions used to determine the fair value.

During the three months ended August 25, 2024, there was a decrease in discount rates that lowered the fair value of the debt derivative liability.

During the three months ended September 30, 2025, the passage of time slightly increased the fair value of the debt derivative liability.

Key inputs used to develop the fair value measurement were as follows:

September 30, 2025 May 25,

2026 December 31,

Probability of change in control event 80.0 % 80.0 %

2 unchanged sentences

Cash and Revolving Credit Facility

Outstanding cash and outstanding borrowings under the Company's Revolving Credit Facility are carried at cost, which approximates fair value due to their short duration and variable rates of interest (a level 2 measurement).

Cash and outstanding borrowings under the Company's Revolving Credit Facility, if any, are carried at cost, which approximates fair value due to their short duration and variable rates of interest (a level 2 measurement).

Leaseback liability with related party

3 unchanged sentences

The fair value information does not change the stated rate or carrying value of the instrument.

The fair value of the leaseback liability was estimated using a discounted cash flow method (a level 3 measurement) that assumes a weighted-average discount rate of 5.2 % and 5.8 % as of September 30, 2025 and May 25, 2025, respectively.

As of September 30, 2025 and May 25, 2025, the fair value of the leaseback liability approximated its carrying value.

The fair value of the leaseback liability was estimated using a discounted cash flow method (a level 3 measurement) that assumes a weighted-average discount rate of 5.4 % and 5.1 % as of March 31, 2026 and December 31, 2025, respectively.

As of March 31, 2026 and December 31, 2025, the fair value of the leaseback liability approximated its carrying value of $ 5,604 and $ 5,798 , respectively.

Customer deposit

A significant customer of the Company agreed to provide an upfront cash deposit in order to finance working capital requirements for the duration of its commercial supply agreement with us.

The deposit bears no interest and matures upon termination of the commercial supply agreement, which can be extended indefinitely upon mutual agreement of the parties, and was most recently extended in March 2024 for a period of 1.75 years to December 31, 2026.

A significant customer of the Company agreed to provide an upfront cash deposit in order to finance working capital requirements for the duration of its commercial supply agreement with the Company.

The deposit bears no interest and is to be repaid after a wind-up period following expiration or termination of the commercial supply agreement.

The commercial supply agreement, which was previously extended through December 31, 2026, automatically renewed on December 31, 2025 for one additional year, resulting in a current term ending December 31, 2027.

In accordance with U.S.

1 unchanged sentence

The fair value information does not change the stated rate or carrying value of the instrument.

The fair value of the deposit is estimated using a discounted cash flow method (a level 3 measurement) that includes assumed discount rates of 6.2 % and 6.6 % as of September 30, 2025 and May 25, 2025, respectively.

The fair value assumes repayment in 1.3 years and 1.6 years as of September 30, 2025 and May 25, 2025, respectively, which was the remaining contractual term of the agreement as of each measurement date.

As of September 30, 2025 and May 25, 2025, the fair value of the deposit approximated its carrying value.

Conversion ratio improvement provided to preferred stockholders

During the three months ended November 24, 2024, the Company performed a non-recurring fair value measurement to record the value of a conversion ratio improvement provided to preferred stockholders as a result of the October 3, 2024 Securities Purchase Agreement referenced in note 10.

The fair value of the conversion feature was recorded as $ 2,132 adjustment to loss attributable to common stockholders.

The fair value was calculated using an as-converted method based on the contractual conversion ratio of the preferred shares and the closing price of Common Stock, a level 1 measurement.

The weighted average discount rate was calculated based on the individual discount rate used for each future payment and weighted by both the present value of the future payments and the probability of each scenario.

The fair value of the deposit is estimated using a discounted cash flow method (a level 3 measurement) that includes assumed discount rates of 6.2 % and 6.0 % as of March 31, 2026 and December 31, 2025, respectively.

The fair value assumes repayment in 1.8 years and 2.0 years as of March 31, 2026 and December 31, 2025, respectively, which was the remaining contractual term of the agreement as of each measurement date.

As of March 31, 2026 and December 31, 2025, the fair value of the deposit approximated its carrying value of $ 4,632 and $ 4,515 , respectively.

Substantially all current lease activity comes from two active facilities near the Company’s owned headquarters facility in Chaska, Minnesota.

Additionally, an operating lease liability for the abandoned headquarters of the Curation Foods business in Santa Maria, California was settled with the landlord in the March 2025 for a gain of $ 2,642 .

None of the Company’s other leases are material to the periods presented.

Operating lease assets are included in other assets and operating lease liabilities are presented in accrued expenses and other current liabilities and other liabilities on the consolidated balance sheets.

Finance lease assets are included in property, plant and equipment and finance lease liabilities are classified as debt.

In January 2016, a lease commenced for the Company’s warehouse and final packaging building in Chaska, Minnesota.

The lease has since been amended twice to accomplish the following:

(i) to extend the term of the lease to September 2034, (ii) to add a buyout option equal to the balance of the lessor’s mortgage loan, valued at $ 3,100 as of September 30, 2025;

and (iii) to provide a $ 2,400 cash payment to the Company in October 2024 in exchange for an increased rent payment schedule and an updated purchase option.

(i) to extend the term of the lease to September 2034, (ii) to add a purchase option equal to the balance of the lessor’s mortgage loan, valued at $ 3,100 as of March 31, 2026;

and (iii) to provide a $ 2,400 cash payment to the Company in October 2024 in exchange for an increased rent payment schedule and the updated purchase option.

The lease is classified as a finance lease and has a discount rate of 9 %, which was the Company’s incremental borrowing rate at the time of the most recent amendment to the lease in August 2024.

In January 2021, a lease commenced for the Company’s warehouse and office space in Chanhassen, Minnesota.

The lease term extends through March 2033.

The lease expires in March 2028 with an option to extend through March 2033 that the Company is reasonably certain to exercise.

The lease is classified as an operating lease and has a discount rate of 3 %, which was the Company’s incremental borrowing rate at lease inception.

1 unchanged sentence

Three months ended

September 30, 2025 August 25, 2024

2026 February 23,

Finance lease cost:

3 unchanged sentences

Total lease cost $ 243 $ 246

The Company’s maturity analysis of operating and finance lease liabilities as of September 30, 2025 are as follows:

The Company’s maturity analysis of operating and finance lease liabilities as of March 31, 2026 are as follows:

leases Finance

Remainder of 2026

2026 $ 410 $ 691

Thereafter 347 5,973

3 unchanged sentences

Classification on consolidated balance sheet:

Accounts payable

Accrued expenses and other current liabilities (see note 7)

4 unchanged sentences

Three months ended

September 30, 2025 August 25, 2024

Cash paid for amounts included in the measurement of lease liabilities:

2026 February 23,

Operating cash flows from operating leases $ 102 $ 101

2 unchanged sentences

Related party transactions

Alcon has been and continues to be one of the Company's largest customers, comprising 38 % and 32 % of its revenues for the three months ended September 30, 2025 and August 25, 2024, respectively.

Alcon has been and continues to be the Company's largest customer, comprising 39 % and 54 % of its revenues for the three months ended March 31, 2026 and February 23, 2025, respectively.

On May 22, 2023, Alcon entered into the Term Loan Credit Facility with the Company as described in note 9.

This relationship as the Company's largest creditor, combined with its position as one of the Company's largest customers, caused management to conclude that Alcon has the ability to exert significant influence over the Company and therefore meets the definition of a related party beginning in May 2023.

This relationship as the Company's largest creditor, combined with its position as the Company's largest customer, caused management to conclude that Alcon has the ability to exert significant influence over the Company and therefore meets the definition of a related party beginning in May 2023 through the present.

Alcon’s transactions with the Company are as follows:

• Customary current financial positions for a customer of Alcon's size, including accounts receivable, contract liabilities and revenue, each as presented in the consolidated balance sheets and statements of operations and the notes thereto.

• Customary current financial positions for a customer of Alcon's size, including accounts receivable, contract assets and liabilities, and revenue, each as presented in the consolidated balance sheets and statements of operations and the notes thereto.

Alcon has provided the Company guaranteed contractual minimum purchasing commitments through 2031, and the Company is required to maintain certain manufacturing capacity levels through 2033;

• Cash advances Alcon provided to the Company to purchase and install Alcon-owned equipment on the Company's premises totaling $ 307 at May 25, 2025;

• A significant individual prepayment that Alcon made to the Company in May 2024 of $ 5,500 .

The prepayment was accounted for as a contract liability, initially recorded at present value due to the existence of a significant financing component, and now being accreted to its settlement value via charges to interest expense, related party.

This contract liability will be settled beginning January 2026 by issuing twelve monthly credit memos to Alcon totaling $ 5,500 .

The contract liability is classified on the balance sheet as a current portion of $ 4,131 and a noncurrent portion of $ 1,058 , which is included in other liabilities on the balance sheet;

The prepayment was accounted for as a contract liability and initially discounted to present value due to the existence of a significant financing component.

The discount is being amortized over the life of the contract liability via charges to interest expense, related party.

This contract liability is being derecognized beginning January 2026 by delivering goods to Alcon at a discount equal to twelve month ly credit memos totaling $ 5,500 .

As of March 31, 2026, the entire contract liability balance of $ 3,999 which is net of the unamortized discount, is included in accrued expenses and other current liabilities on the consolidated balance sheet;

• Proceeds of $ 142,270 from term loans issued in May 2023 that were used to repay prior borrowings.

The term loan principal plus accrued interest has grown to $ 179,562 through September 30, 2025 as a result of 10 % interest paid-in-kind.

The term loan principal plus accrued interest has grown to $ 188,627 through March 31, 2026 as a result of 10 % interest paid-in-kind, which will decrease to 7 % beginning in May 2026.

See note 9 for additional information;

• Alcon purchased equipment in May 2023 for $ 7,730 that it is leasing back to the Company in exchange for quarterly payments over a ten-year period.

Payments to Alcon under the lease were $ 286 and $ 301 for the three months ended September 30, 2025 and August 25, 2024.

Payments to Alcon under the lease were $ 280 and $ 295 for the three months ended March 31, 2026 and February 23, 2025, respectively.

See note 9 for additional information;

• Interest expense incurred from the Alcon borrowings noted above was $ 5,833 and $ 4,400 for the three months ended September 30, 2025 and August 25, 2024, respectively.

Included in those amounts was non-cash interest expense of $ 5,740 and $ 4,296 for the three months ended September 30, 2025 and August 25, 2024, respectively.

• Interest expense incurred from the Alcon instruments noted above, net of capitalized interest, was $ 6,894 and $ 4,840 for the three months ended March 31, 2026 and February 23, 2025, respectively.

Included in those amounts was non-cash interest expense of $ 6,807 and $ 4,632 for the three months ended March 31, 2026 and February 23, 2025, respectively;

• A contract asset of $ 850 as of December 31, 2025 for the recognition of revenue as the result of performance obligations satisfied.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements