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Employee Share-Based Compensation
 6 Months Ended
Jul. 02, 2016
Share-based Compensation  
Employee Share-Based Compensation

Service Period Based Stock Options

 

The following table summarizes activity of service period based stock options granted to employees at July 2, 2016 and changes during the six months then ended:

 

  Weighted Average
  Number of  Exercise  Remaining Contractual  Fair  Aggregate
Intrinsic
  Shares  Price  Term  Value  Value
Outstanding at January 2, 2016   4,314,264   $3.50    6.44           
Options Granted   151,669    4.99    10.00   $3.16    
Options Exercised   (190,473)   2.85                
Options Forfeited   (37,699)   3.49                
Outstanding at July 2, 2016   4,237,761   $3.58    6.04      $3,150,000 
Exercisable at July 2, 2016   3,436,494   $3.50    5.41      $2,817,082 

 

The aggregate intrinsic values in the table above are based on the Company’s stock price of $4.11, which is the closing price of the Company’s stock on the last day of business for the period ended July 2, 2016. The aggregate intrinsic values for options exercised during the six months ended July 2, 2016 was approximately $433,000.

 

The fair value of the Company’s stock options was estimated at the date of grant using the Black-Scholes option pricing model. The table below outlines the weighted average assumptions for options granted to employees during the six months ended July 2, 2016.

 

Six Months Ended July 2, 2016   
Expected term   6.1 years  
Expected volatility   73%
Expected dividends   0.00%
Risk-free rate   1.50%

 

As of July 2,2016, there was approximately $1,594,000 of total unrecognized compensation expense under the plans for all employee stock options. That cost is expected to be recognized over a weighted average period of 2.70 years.

 

Employee Share-Based Compensation

 

The Company recognized compensation expense of approximately $314,000and $621,000 in general and administrative expenses in the statement of operations for the three and six months ended July 2, 2016, respectively, and approximately $442,000and $820,000 for the three and six months ended July 4, 2015, respectively.