Stock-Based Compensation Expense (Tables)

9 Months Ended

Oct. 04, 2015

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

The following table summarizes the Company’s stock option activity for the nine-month period ended October 4, 2015:



	Shares (in thousands)		Weighted- Average Exercise Price		Weighted- Average Remaining Contractual Term (in years)	Aggregate Intrinsic Value (in thousands)
Outstanding as of December 31, 2014	6,812		$	23.26
Granted	1,458		41.25
Exercised	(1,509	)	18.18
Forfeited or expired	(80	)	30.47
Outstanding as of October 4, 2015	6,681		$	28.25	7.3	$	64,101
Exercisable as of October 4, 2015	2,517		$	17.02	5.5	$	47,219
Options vested or expected to vest as of October 4, 2015 (1)	6,018		$	27.17	7.2	$	62,906

(1) In addition to the vested options, the Company expects a portion of the unvested options to vest at some point in the future. Options expected to vest are calculated by applying an estimated forfeiture rate to the unvested options.

Weighted-Average Assumptions Used in Estimating Fair Values of Stock Options Granted

The fair values of stock options granted in each period presented were estimated using the following weighted-average assumptions:



	Three-months Ended				Nine-months Ended
	October 4, 2015		September 28, 2014		October 4, 2015		September 28, 2014
Risk-free rate	2.1	%	2.7	%	2.1	%	2.7	%
Expected dividend yield	1.25	%	—	%	1.25	%	—	%
Expected volatility	40	%	41	%	40	%	41	%
Expected term (in years)	5.4		5.4		5.4		5.4

Nonvested Restricted Stock Shares Activity

The following table summarizes the Company's restricted stock award activity:



	Shares (in thousands)	Weighted-Average Exercise Price		Aggregate Intrinsic Value (in thousands)
Non-vested as of December 31, 2014	20	34.05
Granted	—	—
Vested	—	—
Forfeited or expired	—	—
Non-vested as of October 4, 2015	20	$	34.05	$	27

Schedule of Employee Service Share-based Compensation, Allocation of Recognized Period Costs

The following table details the stock-based compensation expense by caption for each period presented on the Consolidated Statements of Operations (in thousands):



	Three-months Ended				Nine-months Ended
	October 4, 2015		September 28, 2014		October 4, 2015		September 28, 2014
Cost of revenue	$	351	$	253	$	1,167	$	866
Research, development, and engineering	1,130		836		4,097		2,803
Selling, general, and administrative	2,906		1,978		10,273		6,803
Discontinued operations	1,106		231		1,533		786
	$	5,493	$	3,298	$	17,070	$	11,258

Upon the sale of the Company's Surface Inspection Systems Division, completed on July 6, 2015, the Company accelerated the vesting of stock options with respect to 190,000 underlying shares, resulting in an additional $1,106,000 of stock option expense recorded in the third quarter of 2015.