The Company adopted the First Amended and Restated 2022 Nextpower LLC Equity Incentive Plan in April 2022 (the “LLC Plan”), which provides for the issuance of options, unit appreciation rights, performance units, performance incentive units, restricted incentive units and other unit-based awards to employees, directors and consultants of the Company. Additionally, in connection with the Company’s initial public offering (“IPO”), the Company approved the Second Amended and Restated 2022 Nextpower Inc. Equity Incentive Plan (together with the LLC Plan, the “2022 Plan”) to reflect, among other things, that the underlying equity interests with respect to awards issued under the LLC Plan shall, in lieu of common units of the LLC, relate to Class A common stock of Nextpower for periods from and after the closing of the IPO.


	Three-month periods ended
	July 3, 2026		June 27, 2025
	(In thousands)
Cost of sales	$	4,445	$	2,238
Selling, general and administrative expenses	21,168		18,492
Research and development	4,025		1,580
Total stock-based compensation expense	$	29,638	$	22,310

During the three-month period ended July 3, 2026, the Company granted 0.2 million time-based unvested restricted share units (“RSU”) awards to certain of its employees under the 2022 Plan. The vesting for these unvested RSU awards is contingent upon time-based vesting with continued service over a three-year period from the grant date, with a portion of the awards vesting at the end of each year. The weighted average fair value per share of the RSUs granted during the period was estimated to be $129.65 per award.

In addition, the Company also granted 0.2 million performance-based vesting (“PSU”) awards whereby vesting is generally contingent upon (i) time-based vesting with continued service through March 31, 2029, and (ii) the achievement of certain metrics specific to the Company, which could result in a range of 0-300% of such PSUs ultimately vesting. The weighted average fair value per share of the PSUs granted during the three-month period ended July 3, 2026 was estimated to be $164.43 per award. The fair value of these PSU awards granted during the period was determined using Monte-Carlo simulation models, which is a probabilistic approach for calculating the fair value of the awards. During the three-month period ended July 3, 2026, approximately 0.4 million PSU awards were granted and immediately vested, which represent the number of awards achieved above target levels based on the achievement of certain performance-based metrics related to PSU awards granted in fiscal year 2024.

Additionally, during the three-month period ended July 3, 2026, 1.4 million awards were forfeited primarily due to option awards granted in fiscal year 2023 that were forfeited upon exercises as a result of the maximum benefit limit stipulated within the applicable award agreement.

The total unrecognized compensation expense related to unvested awards under the 2022 Plan as of July 3, 2026 was approximately $215.2 million, which is expected to be recognized over a weighted-average period of approximately 2.2 years.