Note 11 - Stock Compensation Plans

12 Months Ended

Dec. 31, 2011

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

Note 11 — Stock Compensation Plans

In April 2007, Shareholders approved the Escalade, Incorporated 2007 Incentive Plan (“2007 Incentive Plan”), which is an incentive plan for key employees, directors and consultants with various equity-based incentives as described in the plan document. The 2007 Incentive Plan is a replacement for the 1997 Incentive Stock Option Plan and the 1997 Director Stock Compensation and Option Plan which expired at the end of April 2007. All options issued and outstanding under the expired plans will remain in effect until exercised, expired or forfeited.

The 2007 Incentive Plan is administered by the Board of Directors or a committee thereof, which is authorized to determine, among other things, the key employees, directors or consultants who will receive awards under the plan, the amount and type of award, exercise prices or performance criteria, if applicable, and vesting schedules. Subject to various restrictions contained in the plan document, the total number of shares of common stock which may be issued pursuant to awards under the Plan may not exceed 1,481,491 shares.

Restricted Stock Units

In 2009, 2008, and 2007, the Company granted restricted stock units to certain officers and directors of the Company at fair market value on the date of grant. The restricted stock units granted to employees of the Company vest over three to four years and are dependent on certain market criteria. The restricted stock units granted to directors vest immediately or within two years. All restricted stock units are payable in shares of the Company’s common stock upon vesting, subject to the deferral election arrangement, and are subject to forfeiture if on the vesting date the employee is not employed or the director no longer holds a position with the Company.

The Company issued no restricted stock units to employees or directors in 2010 and 2011. The following table presents a summary of non-vested restricted stock units granted to employees and directors as of December 31, 2011, and changes during the year ended December 31, 2011:

	Number of Shares			Weighted-Average Grant Date Fair Value
Non-vested restricted stock units as of December 25, 2010		82,708		$	5.78
Granted		—		$	—
Vested		—		$	—
Forfeited		(82,708	)	$	5.78
Non-vested restricted stock units as of December 31, 2011		—
Vested but unsettled		53,479
Outstanding restricted stock units as of December 31, 2011		53,479

When vesting is dependent on certain market criteria, the fair value of restricted stock units is determined by the use of Monte Carlo techniques. The market price of the Company’s stock on the grant date is used to value restricted stock units where vesting is not contingent on market criteria. In 2010, the Company recorded the impact of pre-vesting forfeitures of certain restricted stock units. The impact of these pre-vesting forfeitures was to reduce the stock compensation expense by $259 thousand. In 2011 and 2010, the Company recognized $35 thousand and ($48) thousand, respectively in compensation expense related to restricted stock units and as of December 31, 2011 and December 25, 2010, there was $0 thousand and $35 thousand respectively, of unrecognized compensation expense related to restricted stock units.

Stock Options

Total compensation expense recorded in the statement of operations for 2011, 2010 and 2009 relating to stock options was $513 thousand, $224 thousand and $84 thousand, respectively.

At the February 24, 2011 meeting of the Board of Directors, the Board voted to approve director stock options of 37,500, and employee incentive stock options of 200,000. The director and employee options have a one year vesting and four year-tiered vesting, respectively, and all options expire in five years.

The following table summarizes option activity for each of the three years ended 2011:

	Incentive Stock Options				Director Stock Options
	Granted		Outstanding		Granted		Outstanding
2011		200,000		915,625		37,500		69,024
2010		299,000		877,500		30,000		51,524
2009		682,000		791,000		30,000		51,600

The fair value of each option grant award is estimated on the grant date using the Black-Scholes-Merton option valuation model using the following assumptions:

	2011	2010	2009
Risk-free interest rates	1.51%	1.36%	1.15% to 1.38%
Dividend yields	1.84%	0%	0%
Volatility factors of expected market price of common stock	109.71% to 122.17%	97.64% to 116.63%	81.34% to 94.93%
Weighted average expected life of the options	1-4 years	1-4 years	1-3 years

The following table summarizes stock option transactions for the three years ended 2011:

	2011				2010				2009
	Shares			Option Price	Shares			Option Price	Shares			Option Price
Outstanding at beginning of year		929,024		$0.64 to $11.26		842,600		$0.64 to $13.40		390,867		$6.99 to $19.21
Issued during year		237,500		$6.07		329,000		$2.56		712,000		$0.64 to $0.89
Canceled or expired		(125,625	)			(167,576	)			(260,267	)
Exercised during year		(56,250	)	$0.64 to $2.56		(75,000	)	$0.64 to $0.89		—
Outstanding at end of year		984,649		$0.64 to $9.35		929,024		$0.64 to $11.26		842,600		$0.64 to $13.40
Exercisable at end of year		69,399				87,524				191,850
Weighted-average fair value of options granted during the year	$	4.03			$	1.80			$	0.38

The following table summarizes information about stock options outstanding at December 31, 2011:

	Options Outstanding						Options Exercisable
Range of Exercise Prices	Number of Shares		Weighted-Average Remaining Contractual Life		Weighted-Average Exercise Price		Number of Shares		Weighted-Average Exercise Price
$0.64 - $0.89		476,000		2.3 years	$	0.64		5,000	$	0.89
$2.56 - $6.07		502,125		3.6 years	$	4.17		57,875	$	2.56
$9.35		6,524		0.3 years	$	9.35		6,524	$	9.35
		984,649						69,399