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Stockholders' Equity | 12 Months Ended
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Jan. 03, 2020
Stockholders Equity Note [Abstract] |
Stockholders' Equity | Note 12 — Stockholders’ Equity Incentive Plan 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 January 3, 2020, there were 1,633,221 shares available for grant under the Plan. Stock-Based Compensation 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 10). 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 10). Note 12 — Stockholders’ Equity (Continued) Stock-Based Compensation (Continued) The following table represents the fair value of stock-based compensation granted during the year ended 2019 (in thousands):
|  | Fair Value |
Stock options |  | $ | 14,813 |
Restricted stock units |  |  | 728 |
Restricted stock |  |  | 313 |
Total stock-based compensation expense |  | $ | 15,854 |
The cost that has been charged against income for stock-based compensation is set forth below (in thousands):
|  | Years Ended |
|  | 2019 |  |  | 2018 |  |  | 2017 |
Employee stock option |  | $ | 8,144 |  |  | $ | 4,013 |  |  | $ | 1,731 |
Restricted stock |  |  | 320 |  |  |  | 274 |  |  |  | 186 |
Restricted stock units |  |  | 1,905 |  |  |  | 2,120 |  |  |  | 1,226 |
Nonemployee stock options |  |  | 178 |  |  |  | 355 |  |  |  | 18 |
Total stock-based compensation expense |  | $ | 10,547 |  |  | $ | 6,762 |  |  | $ | 3,161 |
The Company recorded stock-based compensation expense in the following categories (in thousands):
|  | Years Ended |
|  | 2019 |  |  | 2018 |  |  | 2017 |
Cost of sales |  | $ | 52 |  |  | $ | 15 |  |  | $ | 8 |
General and administrative |  |  | 4,010 |  |  |  | 2,635 |  |  |  | 1,487 |
Marketing and selling |  |  | 3,318 |  |  |  | 1,805 |  |  |  | 805 |
Research and development |  |  | 3,167 |  |  |  | 2,307 |  |  |  | 861 |
Total stock-based compensation expense, net |  |  | 10,547 |  |  |  | 6,762 |  |  |  | 3,161 |
Amounts capitalized as part of inventory |  |  | 1,017 |  |  |  | 637 |  |  |  | 372 |
Total stock-based compensation expense, gross |  | $ | 11,564 |  |  | $ | 7,399 |  |  | $ | 3,533 |
As of January 3, 2020, total unrecognized compensation cost related to non-vested stock-based compensation arrangements granted under the Plan were as follows (in thousands):
|  | 2019 |
Stock options |  | $ | 14,817 |
Restricted stock and restricted stock units |  |  | 594 |
Total unrecognized stock-based compensation cost |  | $ | 15,411 |
This cost is expected to be recognized over a weighted-average period of approximately two years. Note 12 — Stockholders’ Equity (Continued) Assumptions 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 8% 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 |
|  | 2019 |  |  | 2018 |  |  | 2017 |
Expected dividend yield |  |  | 0 | % |  |  | 0 | % |  |  | 0 | %
Expected volatility |  |  | 53 | % |  |  | 53 | % |  |  | 57 | %
Risk-free interest rate |  |  | 2.40 | % |  |  | 2.71 | % |  |  | 1.96 | %
Expected term (in years) |  |  | 5.66 |  |  |  | 5.72 |  |  |  | 5.67 |
Stock Options A summary of option activity under the Plan for the year ended January 3, 2020 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 28, 2018 |  |  | 3,920 |  |  | $ | 11.80 |  |  |  |  |  |  |  |  |
Granted |  |  | 824 |  |  |  | 35.40 |  |  |  |  |  |  |  |  |
Exercised |  |  | (388 | ) |  |  | 8.92 |  |  |  |  |  |  |  |  |
Forfeited or expired |  |  | (30 | ) |  |  | 25.87 |  |  |  |  |  |  |  |  |
Outstanding at January 3, 2020 |  |  | 4,326 |  |  | $ | 16.46 |  |  |  | 6.51 |  |  | $ | 78,995 |
Exercisable at January 3, 2020 |  |  | 3,047 |  |  | $ | 10.66 |  |  |  | 5.54 |  |  | $ | 72,393 |
A summary of unvested options activity under the Plan for the year ended January 3, 2020 was as follows:
|  | Shares (in 000’s) |  |  | Weighted- Average Grant-Date Fair Value |
Unvested at December 28, 2018 |  |  | 1,260 |  |  | $ | 9.67 |
Granted |  |  | 824 |  |  |  | 17.95 |
Forfeited or expired |  |  | (30 | ) |  |  | 13.29 |
Vested |  |  | (775 | ) |  |  | 8.83 |
Unvested at January 3, 2020 |  |  | 1,279 |  |  | $ | 15.44 |
Note 12 — Stockholders’ Equity (Continued) Stock Options (Continued) The weighted average grant date fair value of options granted and the total intrinsic value of options exercised were as follows:
|  | Years Ended |
|  | 2019 |  |  | 2018 |  |  | 2017 |
Weighted-average grant-date fair value |  | $ | 17.95 |  |  | $ | 11.95 |  |  | $ | 5.42 |
Intrinsic value of options (in thousands) |  | $ | 9,955 |  |  | $ | 13,699 |  |  | $ | 3,065 |
Restricted Stock A summary of restricted stock activity under the Plan for the year ended January 3, 2020 was as follows:
|  | Shares (in 000’s) |  |  | Weighted- Average Grant- Date Fair Value |
Outstanding at December 28, 2018 |  |  | 11 |  |  | $ | 29.80 |
Granted |  |  | 11 |  |  |  | 29.39 |
Vested |  |  | (11 | ) |  |  | 29.80 |
Outstanding at January 3, 2020 |  |  | 11 |  |  | $ | 29.39 |
Restricted Stock Units A summary of restricted stock units’ activity under the Plan for the year ended January 3, 2020 was as follows:
|  | Units (in 000’s) |  |  | Weighted- Average Grant- Date Fair Value |
Outstanding at December 28, 2018 |  |  | 322 |  |  | $ | 10.46 |
Granted |  |  | 19 |  |  |  | 37.98 |
Vested |  |  | (229 | ) |  |  | 12.58 |
Forfeited or expired |  |  | (8 | ) |  |  | 11.57 |
Outstanding at January 3, 2020 |  |  | 104 |  |  | $ | 10.79 |
Stock Offering 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.

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- Definition The entire disclosure for shareholders' equity comprised of portions attributable to the parent entity and noncontrolling interest, including other comprehensive income. Includes, but is not limited to, balances of common stock, preferred stock, additional paid-in capital, other capital and retained earnings, accumulated balance for each classification of other comprehensive income and amount of comprehensive income. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -URI http://asc.fasb.org/topic&trid=2208762 + Details
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