Stock-based Compensation

12 Months Ended

Aug. 27, 2017

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

Stock-based Compensation

5. STOCK-BASED COMPENSATION

Stock Options - The 2005 Stock Option Plan was approved and 800,000 shares of common stock were reserved for granting of options to officers, key employees and directors. The Plan has been renewed by the Company’s shareholders for a term of 10 years and will expire in 2025. Stock options vest over a period of six months to three years.

Option transactions during the three years ended August 27, 2017 are summarized as follows:

	2005 Stock Option Plan
				Average
	Shares			Price
Outstanding at August 31, 2014		303,251		$	5.30
Granted		78,750		$	6.01
Forfeit		-			-
Lapsed		-			-
Exercised		(29,500	)	$	3.13
Outstanding at August 30, 2015		352,501		$	5.64
Granted		96,500		$	4.43
Forfeit		(26,000	)	$	5.63
Lapsed		(8,000	)	$	6.09
Exercised		-		$	-
Outstanding at August 28, 2016		415,001		$	5.35
Granted		151,250		$	3.01
Forfeit		(240,550	)	$	5.08
Lapsed		(15,500	)	$	4.35
Exercised		(5,000	)	$	2.98
Outstanding at August 27, 2017		305,201		$	4.49

Of the 5,000 and 29,500 stock options from the 2005 Plan that were exercised in fiscal 2017 and 2015, 4,835 and 18,443 shares were returned to the Company to pay for the exercise price and for related payroll withholding taxes, respectively.

The weighted fair value of options granted during the years ended August 27, 2017, August 28, 2016 and August 30, 2015 was $1.29, $1.05 and $2.57, respectively. The total intrinsic value of options exercised for the years August 27, 2017 and August 30, 2015 was $850 and $85,705, respectively. The intrinsic value for all options outstanding at August 27, 2017 was $0.

Cash received from option exercises for year ended August 30, 2015 was $8,520. The actual tax benefit (expense) realized for the tax deductions from option exercises totaled ($1,365) and $15,885 for fiscal years ended 2017and 2015, respectively.

As of August 27, 2017, there was $116,313 of total unearned compensation cost related to option-based compensation arrangements to be recognized over an expected weighted average of 1 year.

As of August 27, 2017, there were 8,000 shares with an exercise price of $2.13, 115,250 shares with exercise prices between $2.98 and $3.46, 53,700 options outstanding with exercise prices between $4.37 and $4.44, 38,000 options outstanding with exercise prices between $4.93 and $5.39 and 90,251 with exercise prices between $5.95 and $7.45. At August 27, 2017, outstanding options had a weighted-average remaining contractual life of 6.7 years.

The number of options exercisable as of August 27, 2017, August 28, 2016 and August 30, 2015 were 215,968, 318,830 and 267,748, respectively, at weighted average share prices of $4.93, $5.46 and $5.49 per share, respectively. At August 27, 2017, there were 89,233 options that had not vested. The aggregate intrinsic values of options exercisable as of August 27, 2017, August 28, 2016 and August 30, 2015 was $0, $0 and $33,059, respectively, with weighted-average remaining contractual lives of 5.9, 5.8 and 6.3 years.

The Company can also grant non-vested restricted shares as part of the 2005 Stock Option Plan. Non-vested restricted share transactions during the three years ended August 27, 2017 are as follows:

	Options			Average Price
Outstanding at August 31, 2014		4,776		$	5.16
Granted		54			6.09
Vested		(4,830	)		5.32
Outstanding at August 30, 2015		-		$	-
Granted		-			-
Vested		-			-
Outstanding at August 28, 2016		-		$	-
Granted		50,000			3.06
Vested		(25,000	)		3.06
Outstanding at August 27, 2017		25,000		$	3.06

As of August 27, 2017, there was $34,924 in total unrecognized compensation cost related to non-vested restricted stock compensation arrangements granted under the Plan.