Stockholders' Equity

12 Months Ended

Dec. 30, 2022

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, RSUs and PSUs. 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 and PSUs outstanding under the Plan generally vest based on service, performance, or a combination of both. On July 30, 2020, stockholders approved a proposal to increase the number of shares under the Plan by 2,650,000 shares, for a total of 18,035,000 shares. As of December 30, 2022, there were 2,089,074 shares available for grant under the Plan.

Stock-Based Compensation

The following table represents the fair value of stock-based compensation granted during the year ended 2022 (in thousands):

	Fair Value
Stock options	$	17,428
RSUs		8,929
Performance stock units		8,421
Restricted stock		270
Total stock-based compensation expense	$	35,048

The Company recorded stock-based compensation expense by award as follows (in thousands):

	Years Ended
	2022		2021		2020
Employee stock option	$	10,403	$	10,373	$	9,577
Restricted stock		686		616		428
RSUs		4,512		2,667		1,732
PSUs		3,525		371		147
Nonemployee stock options		1,245		578		262
Total stock-based compensation expense	$	20,371	$	14,605	$	12,146

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

	Years Ended
	2022		2021		2020
Cost of sales	$	501	$	215	$	112
General and administrative		9,402		6,495		4,925
Selling and marketing		4,795		3,454		3,471
Research and development		5,673		4,441		3,638
Total stock-based compensation expense, net		20,371		14,605		12,146
Amounts capitalized as part of inventory		1,881		1,295		1,129
Total stock-based compensation expense, gross	$	22,252	$	15,900	$	13,275

Note 12 — Stockholders’ Equity (Continued)

Stock-Based Compensation (Continued)

As of December 30, 2022, total unrecognized compensation cost related to non-vested stock-based compensation arrangements granted under the Plan were as follows (in thousands):

	2022
Stock options	$	17,140
Restricted stock, RSUs and PSUs		13,638
Total unrecognized stock-based compensation cost	$	30,778

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

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 a 5% 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
	2022			2021			2020
Expected dividend yield		0	%		0	%		0	%
Expected volatility		54	%		53	%		53	%
Risk-free interest rate		2.09	%		0.84	%		0.53	%
Expected term (in years)		5.10			5.38			5.72

Stock Options

A summary of option activity under the Plan for the year ended December 30, 2022 was as follows:

	Shares (in 000’s)			Weighted- Average Exercise Price		Weighted- Average Remaining Contractual Term (years)		Aggregate Intrinsic Value (in 000’s)
Outstanding at December 31, 2021		2,435		$	29.81
Granted		488			73.51
Exercised		(427	)		19.71
Forfeited or expired		(27	)		82.29
Outstanding at December 30, 2022		2,469		$	39.63		5.03	$	45,104
Exercisable at December 30, 2022		1,836		$	27.97		4.07	$	44,137

Note 12 — Stockholders’ Equity (Continued)

Stock Options (Continued)

A summary of unvested options activity under the Plan for the year ended December 30, 2022 was as follows:

	Shares (in 000’s)			Weighted-Average Grant-Date Fair Value
Unvested at December 31, 2021		572		$	28.63
Granted		488			35.68
Forfeited or expired		(27	)		39.27
Vested		(400	)		25.72
Unvested at December 30, 2022		633		$	35.37

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

	Years Ended
	2022		2021		2020
Weighted-average grant-date fair value	$	35.68	$	45.08	$	13.85
Intrinsic value of options (in thousands)	$	25,000	$	127,024	$	59,771

Restricted Stock, Restricted Stock Units and Performance Stock Units

A summary of restricted stock, RSU and PSU activity under the Plan for the year ended December 30, 2022 was as follows:

	Restricted Stock					Restricted Stock Units					Performance Stock Units
	Units (in 000’s)			Weighted- Average Grant- Date Fair Value		Units (in 000’s)			Weighted- Average Grant- Date Fair Value		Units (in 000’s)			Weighted- Average Grant- Date Fair Value
Outstanding at December 31, 2021		3		$	154.96		131		$	66.94		10		$	51.42
Granted		6			62.10		118			75.62		113			74.80
Vested		(5	)		154.96		(57	)		63.73		(5	)		51.42
Outstanding at December 30, 2022		4		$	62.10		192		$	73.25		118		$	73.78