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Stock Compensation Plans and Stock Based Compensation (Tables)
 12 Months Ended
Jan. 02, 2021
Share-based Payment Arrangement [Abstract]  
Stock based compensation expense and allocation by share based payment award
Stock-based compensation expense and the related income tax benefit recognized in connection with stock options, restricted stock and the ESPP during fiscal 2020, 2019 and 2018 were as follows:
202020192018
(In thousands)
Stock options$8,062 $6,806 $5,581 
Restricted stock173,193 164,078 153,348 
ESPP16,013 10,663 8,786 
Total stock-based compensation expense$197,268 $181,547 $167,715 
Income tax benefit$31,857 $30,118 $32,830 
Stock based compensation expense and allocation by cost
Stock-based compensation expense is reflected in Cadence’s consolidated income statements during fiscal 2020, 2019 and 2018 as follows:
202020192018
(In thousands)
Cost of product and maintenance$2,922 $2,759 $2,631 
Cost of services3,720 3,510 3,714 
Marketing and sales42,096 39,088 34,665 
Research and development124,999 114,656 104,353 
General and administrative23,531 21,534 22,352 
Total stock-based compensation expense$197,268 $181,547 $167,715 
Fair value of options granted and the weighted-average assumptions The weighted-average grant date fair value of options granted and the weighted-average assumptions used in the model for fiscal 2020, 2019 and 2018 were as follows:
202020192018
Dividend yieldNoneNoneNone
Expected volatility25.1 %24.4 %24.3 %
Risk-free interest rate1.36 %2.47 %2.54 %
Expected term (in years)4.84.84.8
Weighted-average fair value of options granted$19.38 $14.58 $10.24 
Summary of changes in stock options outstanding under equity incentive plans
A summary of the changes in stock options outstanding under Cadence’s equity incentive plans during fiscal 2020 is presented below:
Weighted-
Average
Weighted-
Average
Remaining
Contractual
Terms



Aggregate
Intrinsic
SharesExercise Price(Years)Value
(In thousands)(In thousands)
Options outstanding as of December 28, 20194,933 $26.38 
Granted534 79.82 
Exercised(1,497)17.69 
Forfeited(36)49.97 
Options outstanding as of January 2, 20213,934 $36.72 3.4$392,240 
Options vested as of January 2, 20212,974 $28.37 2.7$321,425 
Intrinsic value of and cash received from options exercised
The total intrinsic value of and cash received from options exercised during fiscal 2020, 2019 and 2018 was:
202020192018
(In thousands)
Intrinsic value of options exercised$109,193 $51,625 $31,109 
Cash received from options exercised26,474 14,553 11,748 
Stock-based compensation expense related to performance-based restricted stock grants
Stock-based compensation expense related to performance-based and market-based performance restricted stock grants for fiscal 2020, 2019 and 2018 was as follows:
202020192018
(In thousands)
Stock-based compensation expense related to performance-based restricted stock$14,859 $12,640 $12,868 
Stock-based compensation expense related to market-based performance stock awards8,335 7,019 2,300 
Summary of the changes in restricted stock outstanding under Cadence's equity incentive plans
A summary of the changes in restricted stock outstanding under Cadence’s equity incentive plans during fiscal 2020 is presented below:
Weighted-
Average Grant Date
Weighted-
Average
Remaining
Vesting
Terms



Aggregate
Intrinsic
SharesFair Value(Years)Value
(In thousands)(In thousands)
Unvested shares as of December 28, 20198,393 $42.55 
Granted2,180 101.80 
Vested(3,865)42.14 
Forfeited(469)47.74 
Unvested shares as of January 2, 20216,239 $63.12 1.1$851,087 
Total fair value of restricted stock awards that vested
The total fair value realized by employees upon vesting of restricted stock during fiscal 2020, 2019 and 2018 was:
202020192018
(In thousands)
Fair value of restricted stock realized upon vesting$358,261 $298,320 $232,099 
Weighted-average grant date fair value of purchase rights granted under ESPP and weighted average assumptions used in model The weighted-average grant date fair value of purchase rights granted under the ESPP and the weighted-average assumptions used in the model for fiscal 2020, 2019 and 2018 were as follows:
202020192018
Dividend yieldNoneNoneNone
Expected volatility32.6 %27.9 %21.1 %
Risk-free interest rate0.8 %2.23 %2.05 %
Expected term (in years)0.50.50.5
Weighted-average fair value of options granted$23.08 $14.37 $9.24 
Shares of common stock issued under Employee Stock Purchase Plan
Shares of common stock issued under the ESPP for fiscal 2020, 2019 and 2018 were as follows:
202020192018
(In thousands, except per share amounts)
Cadence shares purchased under the ESPP785 988 892 
Cash received for the purchase of shares under the ESPP$48,328 $38,290 $29,160 
Weighted-average purchase price per share$61.55 $38.74 $32.69 
Summary of common stock reserved for future issuance
As of January 2, 2021, Cadence had reserved the following shares of authorized but unissued common stock for future issuance:
Shares
(In thousands)
Employee equity incentive plans*21,365 
Employee stock purchase plans5,254 
Directors stock plans*730 
    Total27,349 
_____________
*Includes shares reserved for: (i) issuance upon exercise of future option grants, (ii) issuance upon vesting of future restricted stock grants, (iii) outstanding but unexercised options to purchase common stock, or (iv) unvested restricted stock units.