On February 11, 2016, a shareholder increased its beneficial ownership of the Company’s common stock to approximately 26% of all shares outstanding. This triggered the “Change in Control” provision in the Amended and Restated 2003 Omnibus Equity Incentive Plan (“Plan”). As a result, all then unvested equity awards outstanding under the Plan immediately vested. Consequently, we recorded an aggregate $6,857,000 non-cash charge to stock-based compensation in the Consolidated Statements of Operations on that date ($4,569,000 for stock options and $2,288,000 for restricted stock and restricted stock units). This charge was recorded and included in the following categories of the Consolidated Statements of Operations for the year ended December 30, 2016: $2,931,000 in general and administrative expenses, $1,527,000 in marketing and selling expenses, $1,838,000 in research and development expenses and $561,000 in manufacturing costs. Approximately $3,338,000 of the $6,857,000 of accelerated charges would have been recognized for stock-based compensation by the Company in fiscal years subsequent to 2016 had the Change in Control provision not been triggered.

The Amended and Restated Omnibus Equity Incentive Plan (“the Plan”) provides for various forms of stock-based incentives. To date, of the available forms of awards under the Plan, the Company has granted only stock options, restricted stock, unrestricted share grants, and restricted stock units (“RSUs”). Options under the Plan are granted at fair market value on the date of grant, become exercisable generally over a three-year period, or as determined by the Board of Directors, and expire over periods not exceeding 10 years from the date of grant. Certain option and share awards provide for accelerated vesting if there is a change in control and pre-established financial metrics are met (as defined in the Plan). Grants of restricted stock outstanding under the Plan generally vest over periods of one to three years. Grants of RSUs outstanding under the Plan generally vest based on service, performance, or a combination of both. On June 14, 2018, stockholders approved a proposal to increase the number of shares under the Plan by 2,235,000 shares, for a total of 15,385,000 shares. As of December 28, 2018, there were 2,479,205 shares available for grant under the Plan.

There was no net income tax benefit recognized in the Consolidated Statements of Operations for stock-based compensation expense for non-qualified stock options, as the Company fully offsets net deferred tax assets with a valuation allowance (see Note 9). The Company does not recognize deferred income taxes for incentive stock option compensation expense, and records a tax deduction only when a disqualified disposition has occurred (see Note 9).

The following table represents the fair value of stock-based compensation granted during the year ended 2018 (in thousands):

The cost that has been charged against income for stock-based compensation is set forth below (in thousands):

	Years Ended
	2018		2017		2016
Employee stock option	$	4,013	$	1,731	$	5,485
Restricted stock		274		186		298
Restricted stock units		2,120		1,226		2,717
Nonemployee stock options		355		18		58
Total stock-based compensation expense	$	6,762	$	3,161	$	8,558

The Company recorded stock-based compensation expense in the following categories (in thousands):

	Years Ended
	2018		2017		2016
Cost of sales	$	15	$	8	$	612
General and administrative		2,635		1,487		3,809
Marketing and selling		1,805		805		1,961
Research and development		2,307		861		2,176
Total stock-based compensation expense, net		6,762		3,161		8,558
Amounts capitalized as part of inventory		637		372		269
Total stock-based compensation expense, gross	$	7,399	$	3,533	$	8,827

As of December 28, 2018, total unrecognized compensation cost related to non-vested stock-based compensation arrangements granted under the Plan were as follows (in thousands):

This cost is expected to be recognized over a weighted-average period of approximately two years.

The fair value of each option award is estimated on the date of grant using a Black-Scholes option valuation model applying the weighted-average assumptions noted in the following table. Expected volatilities are based on historical volatility of the Company’s stock. The expected term of options granted is derived from the historical exercises and post-vesting cancellations, and represents the period of time that options granted are expected to be outstanding. The Company has calculated an 11% estimated forfeiture rate based on historical forfeiture experience. The risk-free rate is based on the U.S. Treasury yield curve corresponding to the expected term at the time of the grant.

	Years Ended
	2018			2017			2016
Expected dividend yield		0	%		0	%		0	%
Expected volatility		53	%		57	%		57	%
Risk-free interest rate		2.71	%		1.96	%		1.34	%
Expected term (in years)		5.72			5.67			5.57

A summary of option activity under the Plan for the year ended December 28, 2018 is presented below:

	Shares (in 000’s)			Weighted- Average Exercise Price		Weighted- Average Remaining Contractual Term (years)		Aggregate Intrinsic Value (in 000’s)
Outstanding at December 29, 2017		3,725		$	8.78
Granted		826			23.19
Exercised		(596	)		8.72
Forfeited or expired		(35	)		11.27
Outstanding at December 28, 2018		3,920		$	11.80		6.80	$	76,615
Exercisable at December 28, 2018		2,660		$	8.53		5.79	$	60,455

A summary of unvested options activity under the Plan for the year ended December 28, 2018 was as follows:

	Shares (in 000’s)			Weighted- Average Grant-Date Fair Value
Unvested at December 29, 2017		1,148		$	4.96
Granted		826			11.95
Forfeited or expired		(35	)		5.73
Vested		(679	)		4.90
Unvested at December 28, 2018		1,260		$	9.67

The weighted average grant date fair value of options granted and the total intrinsic value of options exercised were as follows:

	Years Ended
	2018		2017		2016
Weighted-average grant-date fair value	$	11.95	$	5.42	$	3.77
Intrinsic value of options (in thousands)	$	13,699	$	3,065	$	1,737

A summary of restricted stock activity under the Plan for the year ended December 28, 2018 was as follows:

	Shares (in 000’s)			Weighted- Average Grant- Date Fair Value
Outstanding at December 29, 2017		21		$	9.60
Granted		11			29.43
Vested		(21	)		9.70
Outstanding at December 28, 2018		11		$	29.80

A summary of restricted stock units’ activity under the Plan for the year ended December 28, 2018 was as follows:

	Units (in 000’s)			Weighted- Average Grant- Date Fair Value
Outstanding at December 29, 2017		488		$	9.45
Granted		49			17.22
Vested		(206	)		9.65
Forfeited or expired		(9	)		11.05
Outstanding at December 28, 2018		322		$	10.46

On August 10, 2018, the Company closed an offering of its common stock. As part of this transaction, the Company issued 1,999,850 shares of its common stock at a price of $36.309 per share. Net proceeds, after deducting expenses, received from this offering were $72,150,000.