STOCK-BASED COMPENSATION

6 Months Ended

Jun. 28, 2023

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

Stock-Based Compensation

3. STOCK-BASED COMPENSATION

At June 28, 2023, options to purchase 1,226,687 shares of common stock were outstanding, including 566,533 vested and 660,154 unvested. Unvested options vest over time; however, upon a change in control, the Board of Directors may accelerate vesting. At June 28, 2023, there were no premium options, which are options granted above the stock price at date of grant, that were outstanding. A summary of stock option activity as of June 28, 2023 and changes during the twenty-six weeks ended June 28, 2023 is as follows:

				Weighted-Average		Aggregate
		Weighted-Average		Contractual Life		Intrinsic Value
	Shares	Exercise Price		Life (Years)		(in thousands)
Outstanding - December 28, 2022	1,068,179	$	9.92
Grants	425,230		9.08
Exercised	(184,294)		4.47
Forfeited, cancelled or expired	(82,428)	$	11.25
Outstanding - June 28, 2023	1,226,687	$	10.36		7.02	$	89
Vested and expected to vest at June 28, 2023	1,212,549	$	10.37		7.00	$	87
Exercisable at June 28, 2023	566,533	$	11.33		4.29	$	11

The fair value of each stock option was estimated on the grant date using an exercise price of the closing stock price on the day prior to date of grant and the Black-Scholes option-pricing model with the following weighted average assumptions:

	June 28, 2023		June 29, 2022
Expected volatility	43.7	%	43.0	%
Risk-free interest rate	3.5	%	2.9	%
Expected term (years)	6.25		6.25
Expected dividends	—		—

At June 28, 2023, the Company had total unrecognized compensation expense of $3.0 million related to unvested stock options, which it expects to recognize over a weighted-average period of 3.33 years.

A summary of restricted share activity as of June 28, 2023 and changes during the twenty-six weeks ended June 28, 2023 is as follows:

		Weighted-Average
	Shares	Fair Value
Unvested shares at December 28, 2022	545,480	$	12.02
Granted	363,210	$	9.07
Released	(167,188)	$	12.40
Forfeited, cancelled, or expired	(68,692)	$	12.69
Unvested shares at June 28, 2023	672,810	$	10.27

At June 28, 2023, the Company had unrecognized compensation expense of $6.2 million related to unvested restricted shares, which it expects to recognize over a weighted-average period of 2.71 years.

Total stock-based compensation expense was $0.8 million and $1.6 million for the thirteen and twenty-six weeks ended June 28, 2023, respectively, and $1.0 million and $1.8 million for the thirteen and twenty-six weeks ended June 29, 2022, respectively.

On October 11, 2022, the Company’s Board of Directors approved a share repurchase program (the “2022 Stock Repurchase Plan”) under which the Company is authorized to repurchase up to $20.0 million of shares of its common stock. The 2022 Stock Repurchase Plan will terminate on March 28, 2024, may be modified, suspended or discontinued at any time, and does not obligate the Company to acquire any particular number of shares.

Under the 2022 Stock Repurchase Plan, the Company is permitted to repurchase its common stock from time to time, in amounts and at prices that the Company deemed appropriate, subject to market conditions and other considerations. The Company’s repurchases will be executed using open market purchases, including pursuant to Rule 10b5-1 trading plans, and/or through privately negotiated transactions.

For the thirteen and twenty-six weeks ended June 28, 2023, the Company repurchased 1,272,287 and 1,824,636 shares of common stock, respectively, under the 2022 Stock Repurchase Plan, using open market purchases, for total consideration of approximately $11.9 million and $18.1 million, respectively. The common stock repurchased under 2022 Stock Repurchase Plan were retired upon repurchase. As of June 28, 2023, $1.9 million remained available for repurchases under the 2022 Stock Repurchase Plan of which the entire balance has been completed subsequent to period end.