The Company grants options and RSUs under the 2016 Incentive Plan (the "2016 Plan"), under which awards may be granted to all employees. Award vesting periods for this plan are generally four years. In May 2020, the Company adopted amendments to the 2016 Plan which increased the number of shares of the Company’s common stock that may be issued under the 2016 plan by an additional 2.0 million shares. As of September 27, 2020, approximately 2.5 million shares were reserved for future grants under the 2016 Plan.

Additionally, the Company sponsors an Employee Stock Purchase Plan (the “ESPP”), pursuant to which eligible employees may contribute up to 10% of compensation, subject to certain income limits, to purchase shares of the Company’s common stock. The terms of the plan include a look-back feature that enables employees to purchase stock at a price equal to 85% of the lesser of the fair market value at the beginning of the offering period or the purchase date. The duration of each offering period is generally six-months. As of September 27, 2020, approximately 0.4 million shares were available for issuance under the ESPP.

Stock option activity during the nine months ended September 27, 2020 was as follows:

	Number of Shares			Weighted Average Exercise Price Per Share
	(In thousands)			(In dollars)
Outstanding as of December 31, 2019		2,188		$	26.03
Exercised		(522	)	$	21.10
Cancelled		(20	)	$	35.85
Expired		(30	)	$	35.97
Outstanding as of September 27, 2020		1,616		$	27.32

	Number of Shares			Weighted Average Grant Date Fair Value Per Share
	(In thousands)			(In dollars)
Outstanding as of December 31, 2019		1,587		$	33.95
Granted		685		$	25.00
Vested		(598	)	$	32.51
Cancelled		(70	)	$	34.79
Outstanding as of September 27, 2020		1,604		$	30.63

In July 2020, the Company’s executive officers were granted performance shares with vesting occurring at the end of a three-year period if performance conditions are met. The number of performance shares earned and eligible to vest are determined based on achievement of the pre-determined performance conditions and the recipients’ continued service with the Company. The number of performance shares to vest could range from 0% to 150% of the target shares granted. At the end of each reporting period, the Company evaluates the probability of achieving the performance conditions and records the related stock-based compensation expense based on performance to date over the service period.

Performance shares activity during nine months ended September 27, 2020 was as follows:

	Number of Shares		Weighted Average Grant Date Fair Value Per Share
	(In thousands)		(In dollars)
Outstanding as of December 31, 2019		—	$	—
Granted⁽¹⁾		141	$	28.22
Outstanding as of September 27, 2020		141	$	28.22

⁽¹⁾Shares granted represented the aggregate target numbers of shares that could potentially vest.

The Company measures stock-based compensation at the grant date based on the estimated fair value of the award. Estimated compensation cost relating to RSUs and performance shares is based on the closing fair market value of the Company’s common stock on the date of grant. The fair value of options granted and the purchase rights granted under the ESPP is estimated on the date of grant using a Black-Scholes-Merton option valuation model that uses the assumptions noted in the following table. The estimated expected term of options granted is derived from historical data on employee exercise and post-vesting employment termination behavior. The risk-free interest rate of options granted and the purchase rights granted under the ESPP is based on the implied yield currently available on U.S. Treasury securities with a remaining term commensurate with the estimated expected term. Expected volatility of options granted under the 2016 Plan and the purchase rights granted under the ESPP is based on historical volatility over the most recent period commensurate with the estimated expected term.

The following table sets forth the weighted average assumptions used to estimate the fair value of option grants and purchase rights granted under the ESPP during the three and nine months ended September 27, 2020 and September 29, 2019:

	Three Months Ended										Nine Months Ended
	September 27, 2020	September 29, 2019			September 27, 2020			September 29, 2019			September 27, 2020	September 29, 2019			September 27, 2020			September 29, 2019
	Stock Options				ESPP						Stock Options				ESPP
Expected life (in years)	N/A		6.2			0.5			0.5		N/A		6.2			0.5			0.5
Risk-free interest rate	N/A		1.85	%		0.12	%		1.83	%	N/A		1.85	%		0.72	%		2.06	%
Expected volatility	N/A		33.9	%		66.4	%		44.5	%	N/A		33.9	%		54.8	%		43.9	%
Dividend yield	N/A		—			—			—		N/A		—			—			—

The following table sets forth the stock-based compensation expense resulting from stock options, RSUs, performance shares and the ESPP included in the Company’s unaudited condensed consolidated statements of operations:

	Three Months Ended				Nine Months Ended
	September 27, 2020		September 29, 2019		September 27, 2020		September 29, 2019
	(In thousands)
Cost of revenue	$	923	$	706	$	3,129	$	2,129
Research and development		1,138		1,496		3,879		3,976
Sales and marketing		1,927		2,097		5,596		6,223
General and administrative		3,230		2,687		10,122		7,855
Total	$	7,218	$	6,986	$	22,726	$	20,183

As of September 27, 2020, $4.3 million of unrecognized compensation cost related to stock options was expected to be recognized over a weighted-average period of 1.4 years. $42.2 million of unrecognized compensation cost related to unvested RSUs and performance shares was expected to be recognized over a weighted-average period of 2.3 years.