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STOCKHOLDERS' EQUITY AND STOCK-BASED COMPENSATION | 9 Months Ended
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Sep. 28, 2019
Share-based Payment Arrangement [Abstract] |
STOCKHOLDERS' EQUITY AND STOCK-BASED COMPENSATION | STOCKHOLDERS' EQUITY AND STOCK-BASED COMPENSATION Registered Sale of Equity Securities On March 15, 2019, the Company sold 7.3 million shares of registered common stock for gross proceeds of $8.0 million ($1.10 per share), before deducting underwriting discounts and offering expenses paid by the Company of $0.7 million. This represented approximately 8.9% of Kopin's total outstanding shares of common stock as of the date of purchase. The net proceeds from the offering were used for general corporate purposes, including working capital. On April 10, 2019, the Company sold 0.7 million shares of registered common stock for gross proceeds of $0.8 million ($1.10 per share), before deducting underwriting discounts and offering expenses paid by the Company of less than $0.1 million, pursuant to the partial exercise of the underwriters' overallotment option in connection with its March 15, 2019 public offering. This represented approximately 0.8% of Kopin's total outstanding shares of common stock as of the date of purchase. Non-Vested Restricted Common Stock The fair value of non-vested restricted common stock awards is generally the market value of the Company’s common stock on the date of grant. The non-vested restricted common stock awards require the employee to fulfill certain obligations, including remaining employed by the Company for one, two or four years (the vesting period) and in certain cases also require meeting either performance criteria or the Company’s stock achieving a certain price. For non-vested restricted common stock awards that solely require the recipient to remain employed with the Company, the stock compensation expense is amortized over the anticipated service period. For non-vested restricted common stock awards that require the achievement of performance criteria, the Company reviews the probability of achieving the performance goals on a periodic basis. If the Company determines that it is probable that the performance criteria will be achieved, the amount of compensation cost derived for the performance goal is amortized over the anticipated service period. If the performance criteria are not met, no compensation cost is recognized and any previously recognized compensation cost is reversed. Restricted stock activity was as follows:
| Shares |  | Weighted Average Grant Fair Value
Balance, December 29, 2018 | 2,213,249 |  |  | $ | 2.51 |
Granted | 150,000 |  |  | 1.19 |
Forfeited | (275,625 | ) |  | 2.95 |
Vested | (70,000 | ) |  | 3.32 |
Balance, September 28, 2019 | 2,017,624 |  |  | $ | 2.33 |
On December 31, 2017, the Company amended the employment agreement with our CEO, Dr. John Fan, to expire on December 31, 2020 and as part of the amendment issued restricted stock grants. Of the restricted stock grants issued to Dr. Fan, 640,000 shares will vest upon the first 20 consecutive trading day period following the grant date during which the Company's common stock trades at a price equal to or greater than $5.25, 150,000 shares will vest at the end of the first 20 consecutive trading day period following the grant date during which the Company’s common stock trades at a price per share equal to or greater than $6.00, and 150,000 shares will vest at the end of the first 20 consecutive trading day period following the grant date during which the Company’s common stock trades at a price per share equal to or greater than $7.00. All of the grants are subject to certain acceleration events and expire on December 31, 2020. The total fair value of these awards on December 31, 2017 was $1.7 million. The value of restricted stock grants that vest based on market conditions is computed on the date of grant using the Monte Carlo model with the following assumptions:
| For the three months ended September 28, 2019
Performance price target | $ | 5.25 |  |  | $ | 6.00 |  |  | $ | 7.00 |
Expected volatility | 48.3 | % |  | 48.3 | % |  | 48.3 | %
Interest rate | 1.97 | % |  | 1.97 | % |  | 1.97 | %
Expected life (years) | 3 |  |  | 3 |  |  | 3 |
Dividend yield | — | % |  | — | % |  | — | %
Stock-Based Compensation The following table summarizes stock-based compensation expense within each of the categories below as it relates to non-vested restricted common stock awards for the nine months ended September 28, 2019 and September 29, 2018 (no tax benefits were recognized):
| Three Months Ended |  | Nine Months Ended
| September 28, 2019 |  | September 29, 2018 |  | September 28, 2019 |  | September 29, 2018
Cost of product revenues | $ | 18,309 |  |  | $ | 52,368 |  |  | $ | 82,524 |  |  | $ | 318,519 |
Research and development | 73,939 |  |  | 159,436 |  |  | 262,454 |  |  | 627,519 |
Selling, general and administrative | 359,435 |  |  | 979,026 |  |  | 1,461,021 |  |  | 2,932,581 |
Total | $ | 451,683 |  |  | $ | 1,190,830 |  |  | $ | 1,805,999 |  |  | $ | 3,878,619 |
Unrecognized compensation expense for non-vested restricted common stock as of September 28, 2019 totaled $1.3 million and is expected to be recognized over a weighted average period of less than two years.

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