Grants Receivable, Current

[Table of Contents](#ic085909a172f44ef92ae922b1099b569_7)Each recipient of FCF PSUs is eligible to receive between zero and 200% of the target number of shares of the Company's common stock at the end of the three-year measurement period. The PSUs and FCF PSUs cliff-vest three years from the date of grant, and the Company recognizes compensation expense ratably over the required service period based on its estimate of the number of shares that will vest upon achieving the measurement criteria. If there is a change in the estimate of the number of shares that are probable of vesting, the Company will cumulatively adjust compensation expense in the period that the change in estimate is made. The Company also granted 0.1 million and 0.1 million market-based awards ("MSUs") to its senior management team during the six months ended March 26, 2022 and March 27, 2021, respectively. Each recipient of MSUs is eligible to receive between zero and 200% of the target number of shares of the Company’s common stock at the end of three years based upon achieving a certain total shareholder return relative to a defined peer group. The MSUs were valued at $75.43 and $82.31 per share using the Monte Carlo simulation model. The MSUs cliff-vest three years from the date of grant, and the Company recognizes compensation expense for the MSUs ratably over the service period. At March 26, 2022, there was 1.8 million in aggregate unvested RSUs, PSUs, FCF PSUs and MSUs outstanding.   
At March 26, 2022, there was $21.2 million and $79.9 million of unrecognized compensation expense related to stock options and stock units (comprised of RSUs, PSUs, FCF PSUs and MSUs), respectively, to be recognized over a weighted-average period of 2.5 and 2.1 years, respectively.  
  
(13) Other Balance Sheet Information

|  |  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |  |
|  | March 26,2022 |  | September 25,2021 |
| Inventories |  |  |  |
| Raw materials | $ | 213.2  |  |  | $ | 163.3  |  |
| Work-in-process | 58.2  |  |  | 53.0  |  |
| Finished goods | 254.7  |  |  | 284.9  |  |
|  | $ | 526.1  |  |  | $ | 501.2  |  |



|  |  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |  |
| Property, plant and equipment |  |  |  |
| Equipment | $ | 421.1  |  |  | $ | 467.1  |  |
| Equipment under customer usage agreements | 493.8  |  |  | 484.6  |  |
| Building and improvements | 194.4  |  |  | 191.2  |  |
| Leasehold improvements | 51.1  |  |  | 49.7  |  |
| Land | 41.2  |  |  | 41.3  |  |
| Furniture and fixtures | 17.6  |  |  | 16.8  |  |
| Finance lease right of use asset | 8.5  |  |  | 9.9  |  |
|  | $ | 1,227.7  |  |  | $ | 1,260.6  |  |
| Less – accumulated depreciation and amortization | (720.8) |  |  | (695.9) |  |
|  | $ | 506.9  |  |  | $ | 564.7  |  |

  
In September 2020 and October 2020, the Company received grants of $7.6 million and $119.3 million, respectively, from the Department of Defense Joint Acquisition Task Force ("DOD") to expand production capacity for the Company's two SARS-CoV-2 assays. These grants are specifically to fund capital equipment and labor investments to increase manufacturing capacity to enable the Company to provide a certain amount of COVID-19 tests per month for the U.S. market. The Company is accounting for the funds received under these grants as a reimbursement of the purchased capital equipment. The Company procures and pays for the capital equipment and necessary resources to build out its facility and construct the manufacturing lines to meet the requirements specified in the grant agreement. Subsequent to the Company paying for the capital equipment, the DOD will reimburse the Company upon it meeting certain requirements. However, the DOD retains title to assets purchased under the agreement, and title is transferred to the Company upon meeting certain milestones of the manufacturing efforts and obtaining approval from the DOD that the respective milestone has been met. As of March 26, 2022, the Company had $36.7 million of capital equipment that was awaiting approval from the DOD pending completion of the defined milestones. During the current three and six month periods, the Company received $37.5 million and $58.7 million, respectively, from the DOD, which has been recorded as a reduction of the cost basis of the purchased equipment. During the year ended September 25, 2021, the Company received $21.2 million from the DOD under these grants. Payments under these grants are subject to satisfaction of the conditions of the grants, including applicable governmental appropriations.  
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