What changed in this filing

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Item 1. Financial Statements

2023-04-05 compared with 2023-01-05 · 112 added, 89 removed, 406 unchanged (33% of the section changed)

3 unchanged sentences

(Unaudited, dollars in thousands, except share and per share data)

November 26, 2022 August 27, 2022

February 25, 2023 August 27, 2022

Current assets:

39 unchanged sentences

Preferred stock, $0.01 par value, 100,000,000 shares authorized, none issued

Common stock, $0.01 par value, 600,000,000 shares authorized, 101,856,457 and 101,322,834 shares issued at November 26, 2022 and August 27, 2022, respectively 1,019 1,013

Treasury stock, 2,365,100 shares and 1,818,754 shares at cost at November 26, 2022 and August 27, 2022, respectively ( 78,451 ) ( 62,003 )

Common stock, $0.01 par value, 600,000,000 shares authorized, 101,873,171 and 101,322,834 shares issued at February 25, 2023 and August 27, 2022, respectively 1,019 1,013

Treasury stock, 2,365,100 shares and 1,818,754 shares at cost at February 25, 2023 and August 27, 2022, respectively ( 78,451 ) ( 62,003 )

Additional paid-in-capital

7 unchanged sentences

Total liabilities and stockholders’ equity $ 2,088,679 $ 2,094,249

See accompanying notes to the unaudited condensed consolidated financial statements.

See accompanying notes to the unaudited consolidated financial statements.

The Simply Good Foods Company and Subsidiaries

1 unchanged sentence

(Unaudited, dollars in thousands, except share and per share data)

Thirteen Weeks Ended

November 26, 2022 November 27, 2021

Thirteen Weeks Ended Twenty-Six Weeks Ended

February 25, 2023 February 26, 2022 February 25, 2023 February 26, 2022

Net sales $ 296,584 $ 296,718 $ 597,462 $ 577,983

11 unchanged sentences

Loss in fair value change of warrant liability — ( 12,745 ) — ( 30,062 )

Gain (loss) on foreign currency transactions 108 ( 353 )

(Loss) gain on foreign currency transactions ( 214 ) 780 ( 106 ) 427

Other income — — 6 9

4 unchanged sentences

Other comprehensive income:

Foreign currency translation $ ( 222 ) $ ( 40 )

Foreign currency translation, net of reclassification adjustments 53 ( 708 ) ( 169 ) ( 748 )

Comprehensive income $ 25,695 $ 17,753 $ 61,333 $ 38,865

5 unchanged sentences

Diluted 100,840,887 100,414,770 100,802,169 99,152,961

See accompanying notes to the unaudited condensed consolidated financial statements.

See accompanying notes to the unaudited consolidated financial statements.

The Simply Good Foods Company and Subsidiaries

1 unchanged sentence

(Unaudited, dollars in thousands)

Thirteen Weeks Ended

November 26, 2022 November 27, 2021

Twenty-Six Weeks Ended

February 25, 2023 February 26, 2022

Operating activities

6 unchanged sentences

Estimated credit losses 219 ( 5 )

Unrealized gain on foreign currency transactions ( 108 ) 353

Unrealized loss (gain) on foreign currency transactions 106 ( 427 )

Deferred income taxes 6,845 11,814

11 unchanged sentences

Other assets and liabilities ( 3,222 ) ( 3,273 )

Net cash provided by (used in) operating activities

Net cash provided by operating activities

53,346 30,323

11 unchanged sentences

Principal payments of long-term debt ( 41,500 ) ( 25,000 )

Deferred financing costs — ( 544 )

Net cash used in financing activities

6 unchanged sentences

$ 63,207 $ 51,469

Thirteen Weeks Ended

November 26, 2022 November 27, 2021

Twenty-Six Weeks Ended

February 25, 2023 February 26, 2022

Supplemental disclosures of cash flow information

2 unchanged sentences

Cash paid for taxes

$ 15,747 $ 33,162

Non-cash investing and financing transactions

Issuance of common stock in extinguishment of warrant liabilities $ — $ 189,897

Operating lease right-of-use assets exchanged for operating lease liabilities $ — $ 5,551

See accompanying notes to the unaudited condensed consolidated financial statements.

Non-cash credits for repayment of note receivable $ 78 $ —

See accompanying notes to the unaudited consolidated financial statements.

The Simply Good Foods Company and Subsidiaries

11 unchanged sentences

Balance at November 26, 2022 101,856,457 $ 1,019 2,365,100 $ ( 78,451 ) $ 1,292,720 $ 250,241 $ ( 2,173 ) $ 1,463,356

Net income — — — — — 25,642 — 25,642

Stock-based compensation — — — — 2,739 — — 2,739

Foreign currency translation adjustments — — — — — — 53 53

Shares issued upon vesting of restricted stock units 4,584 — — — ( 103 ) — — ( 103 )

Exercise of options to purchase common stock 12,130 — — — 228 — — 228

Balance at February 25, 2023 101,873,171 $ 1,019 2,365,100 ( 78,451 ) 1,295,584 $ 275,883 ( 2,120 ) 1,491,915

Common Stock Treasury Stock Additional Paid-In Capital Retained Earnings Accumulated Other Comprehensive Loss Total

7 unchanged sentences

Balance at November 27, 2021 96,130,441 $ 961 98,234 $ ( 2,145 ) $ 1,084,690 $ 126,959 $ ( 858 ) $ 1,209,607

See accompanying notes to the unaudited condensed consolidated financial statements.

Notes to Unaudited Condensed Consolidated Financial Statements

Net income — — — — — 18,461 — 18,461

Stock-based compensation — — — — 3,092 — — 3,092

Foreign currency translation adjustments — — — — — — 439 439

Reclassification adjustment for currency translation gains related to the liquidation of foreign entities — — — — — — ( 1,147 ) ( 1,147 )

Repurchase of common stock — — 571,521 ( 20,394 ) — — — ( 20,394 )

Warrant conversion 4,830,761 48 — — 189,849 — — 189,897

Shares issued upon vesting of restricted stock units 9,679 1 — — ( 102 ) — — ( 101 )

Exercise of options to purchase common stock 100,000 1 — — 1,199 — — 1,200

Balance at February 26, 2022 101,070,881 1,011 669,755 ( 22,539 ) 1,278,728 145,420 ( 1,566 ) 1,401,054

See accompanying notes to the unaudited consolidated financial statements.

Notes to Unaudited Consolidated Financial Statements

(Unaudited, dollars in thousands, except for share and per share data)

9 unchanged sentences

The common stock of Simply Good Foods is listed on the Nasdaq Capital Market under the symbol “SMPL.”

Unaudited Interim Condensed Consolidated Financial Statements

The unaudited interim condensed consolidated financial statements include the accounts of Simply Good Foods and its wholly-owned subsidiaries.

Unaudited Interim Consolidated Financial Statements

The unaudited interim consolidated financial statements include the accounts of Simply Good Foods and its wholly-owned subsidiaries.

All intercompany accounts and transactions have been eliminated.

15 unchanged sentences

Recently Issued Accounting Pronouncements Not Yet Adopted

guidance for a limited period of time to ease the potential burden in accounting for reference rate reform on financial reporting.

The amendments in this ASU are effective for all entities and can be applied to contract modifications due to rate reform and eligible existing and new hedging relationships entered into between March 12, 2020 and December 31, 2022.

The amendments of this ASU should be applied on a prospective basis.

In March 2020, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) 2020-04, Reference Rate Reform (Topic 848), Facilitation of the Effects of Reference Rate Reform on Financial Reporting (“ASU 2020-04”), which provides optional guidance for a limited period of time to ease the potential burden in accounting for reference rate reform on financial reporting.

Additionally, in December 2022, the FASB issued ASU 2022-06, Reference Rate Reform (Topic 848), Deferral of the Sunset Date of Topic 848, which extended the period of time for which ASU 2020-04 could be applied.

As a result, the amendments in ASU 2020-04 can be applied to contract modifications due to rate reform and eligible existing and new hedging relationships entered into between March 12, 2020 and December 31, 2024.

The amendments of these ASUs are effective for all entities and should be applied on a prospective basis.

On January 21, 2022, the Company entered into a repricing amendment (the “2022 Repricing Amendment”) to its credit agreement with Barclays Bank PLC and other parties (as amended to date, the “Credit Agreement”), as described in Note 5, Long-Term Debt and Line of Credit.

7 unchanged sentences

The following is a summary of revenue disaggregated by geographic area and brands:

Thirteen Weeks Ended

(In thousands) November 26, 2022 November 27, 2021

Thirteen Weeks Ended Twenty-Six Weeks Ended

(In thousands) February 25, 2023 February 26, 2022 February 25, 2023 February 26, 2022

North America (1)

5 unchanged sentences

(1) The North America geographic area consists of net sales substantially related to the United States and there is no individual foreign country to which more than 10% of the Company’s net sales are attributed or that is otherwise deemed individually material.

Charges related to credit loss on accounts receivables from transactions with external customers were $( 0.1 ) million for the thirteen weeks ended November 26, 2022, and were immaterial for the thirteen weeks ended November 27, 2021.

As of November 26, 2022 and August 27, 2022, the allowances for doubtful accounts related to these accounts receivable were $ 1.1 million and $ 1.2 million, respectively.

Additionally, as of November 26, 2022, the Company had an expected credit loss reserve of $ 1.0 million on a $ 3.0 million note receivable related to the Company’s sale of its SimplyProtein® brand and related assets during its fiscal year 2021.

Charges related to credit loss on accounts receivables from transactions with external customers were $ 0.4 million and $ 0.2 million for the thirteen and twenty-six weeks ended February 25, 2023, respectively.

Charges related to credit loss on accounts receivables from transactions with external customers were immaterial for the thirteen and twenty-six weeks ended February 26, 2022.

As of February 25, 2023 and August 27, 2022, the allowances for doubtful accounts related to these accounts receivable were $ 1.8 million and $ 1.2 million, respectively.

Additionally, as of February 25, 2023, the Company had an expected credit loss reserve of $ 1.0 million on a $ 3.0 million note receivable related to the Company’s sale of its SimplyProtein® brand and related assets during its fiscal year 2021.

Goodwill and Intangibles

As of November 26, 2022 and August 27, 2022, Goodwill in the Consolidated Balance Sheets was $ 543.1 million.

There were no impairment charges related to goodwill during the thirteen weeks ended November 26, 2022 or since the inception of the Company.

As of February 25, 2023 and August 27, 2022, Goodwill in the Consolidated Balance Sheets was $ 543.1 million.

There were no impairment charges related to goodwill during the thirteen and twenty-six weeks ended February 25, 2023 or since the inception of the Company.

Intangible assets, net in the Consolidated Balance Sheets consists of the following:

November 26, 2022

February 25, 2023

(In thousands) Useful life Gross carrying amount Accumulated amortization Net carrying

18 unchanged sentences

$ 1,182,863 $ 59,605 $ 1,123,258

Changes in Intangible assets, net during the thirteen weeks ended November 26, 2022 were primarily related to recurring amortization expense.

Amortization expense related to intangible assets was $ 3.9 million and $ 4.0 million for the thirteen weeks ended November 26, 2022 and November 27, 2021, respectively.

There were no impairment charges related to intangible assets during the thirteen weeks ended November 26, 2022 and November 27, 2021.

Changes in Intangible assets, net during the twenty-six weeks ended February 25, 2023 were primarily related to recurring amortization expense.

Amortization expense related to intangible assets was $ 3.9 million and $ 4.0 million for the thirteen weeks ended February 25, 2023 and February 26, 2022, respectively, and $ 7.8 million and $ 7.9 million for the twenty-six weeks ended February 25, 2023 and February 26, 2022, respectively.

There were no impairment charges related to intangible assets during the thirteen and twenty-six weeks ended February 25, 2023 and February 26, 2022.

Estimated future amortization for each of the next five fiscal years and thereafter is as follows:

4 unchanged sentences

Long-Term Debt and Line of Credit

On July 7, 2017, the Company entered into a credit agreement with Barclays Bank PLC and other parties (as amended to date, the “Credit Agreement”).

On July 7, 2017, the Company (through certain of its subsidiaries) entered into the Credit Agreement.

The Credit Agreement at that time provided for (i) a term facility of $ 200.0 million (“Term Facility”) with a seven -year maturity and (ii) a revolving credit facility of up to $ 75.0 million (the “Revolving Credit Facility”) with a five -year maturity.

21 unchanged sentences

Any failure to comply with the restrictions of the credit facilities may result in an event of default.

The Company was in compliance with all financial covenants as of November 26, 2022 and August 27, 2022, respectively.

The Company was in compliance with all covenants as of February 25, 2023 and August 27, 2022, respectively.

Long-term debt consists of the following:

(In thousands) November 26, 2022 August 27, 2022

Term Facility (effective rate of 7.7% at November 26, 2022)

(In thousands) February 25, 2023 August 27, 2022

Term Facility (effective rate of 8.0% at February 25, 2023)

$ 365,000 $ 406,500

Finance lease liabilities (effective rate of 5.6% at November 26, 2022)

Finance lease liabilities (effective rate of 5.6% at February 25, 2023)

Deferred financing fees 2,402 3,620

2 unchanged sentences

Long-term debt, net of deferred financing fees $ 362,622 $ 403,022

The Company is no t required to make principal payments on the Term Facility over the twelve months following the period ended November 26, 2022.

The Company is no t required to make principal payments on the Term Facility over the twelve months following the period ended February 25, 2023.

The outstanding balance of the Term Facility is due upon its maturity in July 2024.

As of November 26, 2022, the Company had letters of credit in the amount of $ 3.5 million outstanding.

As of February 25, 2023, the Company had letters of credit in the amount of $ 3.5 million outstanding.

These letters of credit offset against the $ 75.0 million availability of the Revolving Credit Facility and exist to support three of the Company’s leased buildings and insurance programs relating to workers’ compensation.

No amounts were drawn against these letters of credit at November 26, 2022.

No amounts were drawn against these letters of credit at February 25, 2023.

The Company utilizes market approaches to estimate the fair value of certain outstanding borrowings by discounting anticipated future cash flows derived from the contractual terms of the obligations and observable market interest and foreign exchange rates.

The Company carries debt at historical cost and discloses fair value.

As of November 26, 2022 and August 27, 2022, the book value of the Company’s debt approximated fair value.

As of February 25, 2023 and August 27, 2022, the book value of the Company’s debt approximated fair value.

The estimated fair value of the Term Loan is valued based on observable inputs and classified as Level 2 in the fair value hierarchy.

7 unchanged sentences

Level 3 Measurements

During the thirteen weeks ended November 27, 2021, the Company had outstanding liability-classified Private Warrants that allowed holders to purchase 6,700,000 shares of the Company’s common stock.

During the thirteen and twenty-six weeks ended February 26, 2022, the Company had outstanding liability-classified Private Warrants that allowed holders to purchase 6,700,000 shares of the Company’s common stock.

Such Private Warrants were held by Conyers Park Sponsor, LLC (“Conyers Park”), a related party, and were exercised on a cashless basis on January 7, 2022 resulting in a net issuance of 4,830,761 shares of the Company’s common stock.

As a result, there were no outstanding liability-classified Private Warrants as of November 26, 2022 and August 27, 2022.

As a result, there were no outstanding liability-classified Private Warrants as of February 25, 2023 and August 27, 2022.

Refer to Note 10, Stockholders’ Equity, for additional details regarding the cashless exercise of the Private Warrants.

5 unchanged sentences

The periodic remeasurement of the warrant liability has been reflected in Loss in fair value change of warrant liability within the Consolidated Statements of Operations and Comprehensive Income.

The adjustment for the thirteen weeks ended November 27, 2021 was a loss of $ 17.3 million.

The adjustments for the thirteen and twenty-six weeks ended February 26, 2022 were losses of $ 12.7 million and $ 30.1 million, respectively.

The tax expense and the effective tax rate resulting from operations were as follows:

Thirteen Weeks Ended

(In thousands) November 26, 2022 November 27, 2021

Twenty-Six Weeks Ended

(In thousands) February 25, 2023 February 26, 2022

Income before income taxes $ 79,596 $ 62,685

1 unchanged sentence

Effective tax rate 22.7 % 36.8 %

The effective tax rate for the thirteen weeks ended November 26, 2022 was 16.4 % less than the effective tax rate for the thirteen weeks ended November 27, 2021, which was primarily driven by the non-cash change in the fair value of the warrant liability in the prior fiscal period and other permanent differences.

The effective tax rate for the twenty-six weeks ended February 25, 2023 was 14.1 % less than the effective tax rate for the twenty-six weeks ended February 26, 2022, which was primarily driven by the non-cash change in the fair value of the warrant liability in the prior fiscal period and other permanent differences.

The components of lease expense were as follows:

Thirteen Weeks Ended

(In thousands) Statements of Operations Caption November 26, 2022 November 27, 2021

Thirteen Weeks Ended Twenty-Six Weeks Ended

(In thousands) Statements of Operations Caption February 25, 2023 February 26, 2022 February 25, 2023 February 26, 2022

Operating lease cost:

12 unchanged sentences

The right-of-use assets and corresponding liabilities related to both operating and finance leases are as follows:

(In thousands) Balance Sheets Caption November 26, 2022 August 27, 2022

(In thousands) Balance Sheets Caption February 25, 2023 August 27, 2022

Operating lease right-of-use assets Other long-term assets $ 43,132 $ 46,460

6 unchanged sentences

Total lease liabilities $ 48,316 $ 51,137

Future maturities of lease liabilities as of November 26, 2022 were as follows:

Future maturities of lease liabilities as of February 25, 2023 were as follows:

(In thousands) Operating Leases Finance Leases

7 unchanged sentences

The weighted-average remaining lease terms and weighted-average discount rates for operating and finance leases were as follows:

November 26, 2022 August 27, 2022

February 25, 2023 August 27, 2022

Weighted-average remaining lease term (in years)

5 unchanged sentences

Supplemental and other information related to leases was as follows:

Thirteen Weeks Ended

(In thousands) November 26, 2022 November 27, 2021

Twenty-Six Weeks Ended

(In thousands) February 25, 2023 February 26, 2022

Cash paid for amounts included in the measurement of lease liabilities

8 unchanged sentences

These contracts contain endorsement fees, which are expensed ratably over the life of the contract, and performance fees, that are recognized at the time of achievement.

Based on the terms of the contracts in place and achievement of performance conditions as of November 26, 2022, the Company will be required to make payments of $ 3.4 million over the next year.

Based on the terms of the contracts in place and achievement of performance conditions as of February 25, 2023, the Company will be required to make payments of $ 3.3 million over the next year.

Stockholders’ Equity

5 unchanged sentences

The stock repurchase program may be suspended or discontinued at any time by the Company and does not have an expiration date.

During the thirteen weeks ended November 26, 2022, the Company repurchased 546,346 shares of common stock at an average share price of $ 30.11 per share.

The Company did not repurchase any shares of common stock during the thirteen weeks ended November 27, 2021.

As of November 26, 2022, approximately $ 71.5 million remained available under the stock repurchase program.

During the twenty-six weeks ended February 25, 2023, the Company repurchased 546,346 shares of common stock at an average share price of $ 30.11 per share.

The Company did not repurchase any shares of common stock during the thirteen weeks ended February 25, 2023.

During the thirteen and twenty-six weeks ended February 26, 2022, the Company repurchased 571,271 shares of common stock at an average share price of $ 35.68 per share.

As of February 25, 2023, approximately $ 71.5 million remained available under the stock repurchase program.

Warrants to Purchase Common Stock

During the thirteen weeks ended November 27, 2021, the Company had outstanding liability-classified Private Warrants that allowed holders to purchase 6,700,000 shares of the Company’s common stock.

Such Private Warrants were held by Conyers Park, a related party.

1 unchanged sentence

On January 7, 2022, Conyers Park elected to exercise the Private Warrants on a cashless basis, resulting in a net issuance of 4,830,761 shares of the Company’s common stock.

As a result of the cashless exercise on January 7, 2022, there were no outstanding liability-classified Private Warrants as of as of November 26, 2022 and August 27, 2022.

As a result of the cashless exercise on January 7, 2022, there were no outstanding liability-classified Private Warrants as of February 25, 2023 and August 27, 2022.

As discussed in Note 6, Fair Value of Financial Instruments, the liability-classified warrants were remeasured on a recurring basis, primarily based on observable market data while the related theoretical private warrant volatility assumption within the Black-Scholes model represents a Level 3 measurement within the fair value measurement hierarchy.

7 unchanged sentences

The following table reconciles the numerators and denominators used in the computations of both basic and diluted earnings per share:

Thirteen Weeks Ended

(In thousands, except per share data) November 26, 2022 November 27, 2021

Thirteen Weeks Ended Twenty-Six Weeks Ended

(In thousands, except per share data) February 25, 2023 February 26, 2022 February 25, 2023 February 26, 2022

Basic earnings per share computation:

10 unchanged sentences

Diluted earnings per share from net income $ 0.25 $ 0.18 $ 0.61 $ 0.40

Diluted earnings per share calculations for the thirteen weeks ended November 26, 2022 and November 27, 2021 excluded 0.4 million shares and 0.2 million shares of common stock issuable upon exercise of stock options, respectively, that would have been anti-dilutive.

Diluted earnings per share calculations for the thirteen weeks ended November 26, 2022 and November 27, 2021 excluded 0.1 million non-vested stock units and an immaterial number of non-vested stock units, respectively, that would have been anti-dilutive.

Diluted earnings per share calculations for the thirteen weeks ended November 27, 2021 excluded 4.6 million shares issuable upon exercise of Private Warrants that would have been anti-dilutive.

Diluted earnings per share calculations for the thirteen and twenty-six weeks ended February 25, 2023 excluded 0.6 million and 0.5 million shares of common stock issuable upon exercise of stock options, respectively, that would have been anti-dilutive.

Diluted earnings per share calculations for the thirteen and twenty-six weeks ended February 26, 2022 excluded 0.3 million and 0.3 million shares of common stock issuable upon exercise of stock options, respectively, that would have been anti-dilutive.

Diluted earnings per share calculations for the thirteen and twenty-six weeks ended February 25, 2023 excluded 0.1 million non-vested stock units and 0.1 million non-vested stock units, respectively, that would have been anti-dilutive.

Diluted earnings per share calculations for the thirteen and twenty-six weeks ended February 26, 2022 excluded 0.1 million and 0.1 million of non-vested stock units, respectively, that would have been anti-dilutive.

The diluted earnings per share calculations for the thirteen and twenty-six weeks ended February 26, 2022 excluded 0.9 million shares and 1.5 million shares issuable upon exercise of Private Warrants, respectively, that would have been anti-dilutive.

Omnibus Incentive Plan

2 unchanged sentences

Stock-based compensation expense is included within General and administrative expense, which is the same financial statement caption where the recipient’s other compensation is reported.

The Company recorded stock-based compensation expense of $ 3.3 million and $ 2.6 million in the thirteen weeks ended November 26, 2022 and November 27, 2021, respectively.

The Company recorded stock-based compensation expense of $ 3.0 million and $ 3.1 million in the thirteen weeks ended February 25, 2023 and February 26, 2022, respectively, and $ 6.3 million and $ 5.7 million in the twenty-six weeks ended February 25, 2023 and February 26, 2022, respectively.

Stock Options

The following table summarizes stock option activity for the thirteen weeks ended November 26, 2022:

The following table summarizes stock option activity for the twenty-six weeks ended February 25, 2023:

Shares underlying options Weighted average

4 unchanged sentences

Forfeited ( 20,009 ) 31.33

Outstanding as of November 26, 2022 2,597,121 $ 19.54 6.09

Vested and expected to vest as of November 26, 2022 2,597,121 $ 19.54 6.09

Exercisable as of November 26, 2022 2,064,196 $ 15.62 5.42

As of November 26, 2022, the Company had $ 6.0 million of total unrecognized compensation cost related to stock options that will be recognized over a weighted average period of 1.9 years.

During the thirteen weeks ended November 26, 2022 and November 27, 2021, the Company received $ 4.6 million and $ 0.3 million in cash from stock option exercises, respectively.

Outstanding as of February 25, 2023 2,564,982 $ 19.45 5.86

Vested and expected to vest as of February 25, 2023 2,564,982 $ 19.45 5.86

Exercisable as of February 25, 2023 2,054,267 $ 15.62 5.16

As of February 25, 2023, the Company had $ 5.0 million of total unrecognized compensation cost related to stock options that will be recognized over a weighted average period of 1.7 years.

During the twenty-six weeks ended February 25, 2023 and February 26, 2022, the Company received $ 4.8 million and $ 1.5 million in cash from stock option exercises, respectively.

Restricted Stock Units

The following table summarizes restricted stock unit activity for the thirteen weeks ended November 26, 2022:

The following table summarizes restricted stock unit activity for the twenty-six weeks ended February 25, 2023:

Units Weighted average

4 unchanged sentences

Forfeited ( 44,662 ) 33.66

Non-vested as of November 26, 2022 530,615 $ 34.78

As of November 26, 2022, the Company had $ 15.7 million of total unrecognized compensation cost related to restricted stock units that will be recognized over a weighted average period of 1.8 years.

Non-vested as of February 25, 2023 498,032 $ 35.08

As of February 25, 2023, the Company had $ 13.3 million of total unrecognized compensation cost related to restricted stock units that will be recognized over a weighted average period of 1.7 years.

Performance Stock Units

During the thirteen weeks ended November 26, 2022, the Board of Directors granted performance stock units under the Company’s equity compensation plan.

During the twenty-six weeks ended February 25, 2023, the Company granted performance stock units under its equity compensation plan.

Performance stock units vest in a range between 0 % and 200 % based upon certain performance criteria in a three -year period.

Performance stock units were valued using a Monte Carlo simulation.

The following table summarizes performance stock unit activity for the thirteen weeks ended November 26, 2022:

The following table summarizes performance stock unit activity for the twenty-six weeks ended February 25, 2023:

Units Weighted average

4 unchanged sentences

Forfeited ( 37,241 ) 31.00

Non-vested as of November 26, 2022 212,862 $ 42.25

As of November 26, 2022, the Company had $ 6.0 million of total unrecognized compensation cost related to performance stock units that will be recognized over a weighted average period of 1.7 years.

Non-vested as of February 25, 2023 195,959 $ 42.85

As of February 25, 2023, the Company had $ 5.0 million of total unrecognized compensation cost related to performance stock units that will be recognized over a weighted average period of 1.5 years.

Stock Appreciation Rights

1 unchanged sentence

The Company’s SARs settle in shares of its common stock once the applicable vesting criteria have been met.

The SARs outstanding as of November 26, 2022 cliff vest two years from the date of grant and must be exercised within five years .

The following table summarizes SARs activity for the thirteen weeks ended November 26, 2022:

The SARs outstanding as of February 25, 2023 cliff vest two years from the date of grant and must be exercised within five years .

The following table summarizes SARs activity for the twenty-six weeks ended February 25, 2023:

Shares underlying SARs Weighted average

4 unchanged sentences

Forfeited — —

Outstanding as of November 26, 2022 150,000 $ 37.67

The SARs exercised in the thirteen weeks ended November 26, 2022 resulted in a net issuance of 38,850 shares of the Company’s common stock.

The SARs granted in the thirteen weeks ended November 26, 2022 are liability-classified;

Outstanding as of February 25, 2023 150,000 $ 37.67

The SARs exercised in the twenty-six weeks ended February 25, 2023 resulted in a net issuance of 38,850 shares of the Company’s common stock.

The SARs granted in the twenty-six weeks ended February 25, 2023 are liability-classified;

therefore the related stock-based compensation expense is based on the vesting provisions and the fair value of the awards.

4 unchanged sentences

The Company substantially completed its restructuring activities during the third quarter of fiscal 2022;

therefore no restructuring or restructuring-related costs were incurred in the thirteen weeks ended November 26, 2022.

In the thirteen weeks ended November 27, 2021, the Company incurred an immaterial amount of restructuring and restructuring-related costs.

therefore no restructuring or restructuring-related costs were incurred in the thirteen and twenty-six weeks ended February 25, 2023.

In the thirteen and twenty-six weeks ended February 26, 2022, the Company incurred $ 0.1 million of restructuring and restructuring-related costs.

Since the announcement of the restructuring activities in May 2020, the Company incurred aggregate restructuring and restructuring-related costs of $ 9.9 million.

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