Stock-Based Compensation Expense

6 Months Ended

Jun. 27, 2011

Stock-Based Compensation Expense

Stock-Based Compensation Expense

Note 2 — Stock-Based Compensation Expense

A summary of non-cash, stock-based compensation expense is as follows:

	For the Three Months Ended				For the Six Months Ended
	(in thousands)				(in thousands)
	June 27, 2011		June 28, 2010		June 27, 2011		June 28, 2010
Stock option compensation expense	$	—	$	—	$	1	$	1
Restricted stock compensation expense, net of forfeitures	108		125		251		362
Total non-cash, stock-based compensation expense, net of forfeitures	$	108	$	125	$	252	$	363

As of June 27, 2011 and June 28, 2010, all compensation expenses related to stock options granted under the Company’s various incentive plans have been recognized in full. In addition, as of June 27, 2011, there was approximately $0.4 million of total unrecognized compensation expense related to restricted stock shares and units granted under the Cosi, Inc. 2005 Omnibus Long-Term Incentive Plan (the “2005 Plan”). The expense related to these grants is being recognized on a straight-line basis from the date of each grant through fiscal 2015.

In the six-month period ended June 27, 2011, pursuant to the 2005 Plan and in accordance with the terms and conditions prescribed by the Compensation Committee of our Board of Directors, we granted and issued 98,000 restricted stock shares and 100,000 restricted stock units to key employees. The vesting of these shares and stock units will occur as follows: (i) 20% of the stock shares and stock units vested on the grant date, and (ii) an additional 20% of the stock shares and stock units will vest on each anniversary of the grant date provided that at each such date the employee continues to be employed by the Company. The value of the shares and the stock units for the grants made in the six-month period ended June 27, 2011, based on the closing price of our common stock on the date of the grants, was approximately $0.3 million. In the six-month period ended June 28, 2010, we granted and issued 238,250 restricted stock shares and 200,000 restricted stock units of our authorized but unissued common stock to key employees. The value of the shares for the grants made during that period, based on the closing price of our common stock on the date of the grants, was approximately $0.4 million.

Stock-based compensation expense relating to restricted stock grants of approximately $0.1 million is included in the accompanying consolidated statement of operations for each of the quarters ended June 27, 2011 and June 28, 2010. For the six-month periods ended June 27, 2011 and June 28, 2010, stock-based compensation expense relating to restricted stock grants is $0.3 million and $0.4 million, respectively.

There were no forfeitures of restricted stock during the three-month period ended June 27, 2011. In the three-month period ended June 28, 2010, 20,200 shares of previously issued restricted common stock were forfeited. The value of the forfeited shares, based on the closing price of our common stock on the date of the grants, was approximately $0.02 million. During the six-month periods ended June 27, 2011 and June 28, 2010, 42,000 and 21,400 shares, respectively, of previously issued restricted common stock were forfeited. The value of the forfeited shares, based on the closing price of our common stock on the date of the grants, was approximately $0.1 million and $0.03 million, respectively, in the six-month periods ended June 27, 2011 and June 28, 2010. The accompanying consolidated statement of operations for the six-month periods ended June 27, 2011 and June 28, 2010 reflects the reversal of approximately $0.02 and $0.01 million, respectively, of previously amortized costs related to these forfeited shares.

In the three-month periods ended June 27, 2011 and June 28, 2010, we issued 110,620 and 152,440 shares, respectively, of our restricted common stock to members of the Board of Directors pursuant to the 2005 Plan. These shares had an aggregate value of approximately $0.1 million and vested upon issuance.