Note 11 - Share Based Compensation

12 Months Ended

Dec. 28, 2013

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

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

11.   SHARE BASED COMPENSATION

At December 28, 2013, the Company had three share-based employee compensation plans. The Company measures the fair value of share-based awards, if and when granted, based on the Black-Scholes method and using the closing market price of the Company’s common stock on the date of grant. Awards vest over periods ranging from one to three years and expire within 10 years of issuance. Share-based compensation expense related to awards is amortized in accordance with applicable vesting periods using the straight-line method. Share-based compensation expense of $849 and $169 was recognized for the fiscal year ended December 28, 2013 and December 29, 2012, respectively.

As of December 28, 2013, the Company had approximately $1.1 million of total unrecognized compensation cost related to all non-vested share-based awards granted under the Company’s various share-based plans, which the Company expects to recognize over approximately a three-year period. These amounts do not include the cost of any additional share-based awards that may be granted in future periods or reflect any potential changes in the Company’s forfeiture rate.

The Company granted 5,000 stock options and 40,000 restricted stock units during the fiscal year ended December 28, 2013 and 55,000 stock options and 350,000 restricted stock units during the fiscal year ended December 29, 2012.

The risk-free rate of return is based on the yield of U.S. Treasury Strips with terms equal to the expected life of the grants as of the grant date. The expected term of grant is based on historical stock option exercise experience. The Company used its historical stock price volatility to compute the expected stock price volatility. The expected dividend yield is based on the Company’s fiscal 2013 dividend rate. The annual forfeiture rate is based on the Company’s historical experience. The Black-Scholes option weighted average assumptions used in the valuation of share based awards for the fiscal years ended December 28, 2013 and December 29, 2012 were as follows:

	Fiscal Years Ended
	December 28, 2013			December 29, 2012
Weighted average risk-free interest rate		1.74	%		0.71	%
Expected term of option (years)		5			5
Expected stock price volatility		52	%		61	%
Expected dividend yield		0.00	%		0.00	%
Annual forfeiture rate		5.98	%		4.68	%
Weighted-average grant date fair value	$	2.94		$	2.85

1996 Executive Stock Option Plan (the 1996 Plan)

The 1996 Plan, approved by the Company’s stockholders in August 1996 and amended in April 1999, provided for the issuance of up to 1,250,000 shares of common stock to officers and key employees of the Company and its subsidiaries through January 1, 2006, at which time the 1996 Plan expired. Options are generally granted at fair market value at the date of grant. The Compensation Committee of the Board of Directors determined the vesting period at the time of grant. As of December 28, 2013, options to purchase 132,000 shares of common stock granted under the 1996 Plan were outstanding.

2000 Employee Stock Incentive Plan (the 2000 Plan)

The 2000 Plan, approved by the Company’s stockholders in April 2001, provides for the issuance of up to 1,500,000 shares of the Company’s common stock to officers and key employees of the Company and its subsidiaries or to consultants and advisors utilized by the Company. The Compensation Committee of the Board of Directors could award incentive stock options or non-qualified stock options, as well as stock appreciation rights, and determined the vesting period at the time of grant. As of December 28, 2013, options to purchase 70,500 shares of common stock granted under the 2000 Plan were outstanding.

The 1996 Plan and 2000 Plan are expired and therefore no shares are available for issuance.

2007 Omnibus Equity Compensation Plan (the 2007 Plan)

The 2007 Plan, approved by the Company’s stockholders in June 2007, provides for the issuance of up to 700,000 shares of the Company’s common stock to officers, non-employee directors, employees of the Company and its subsidiaries or consultants and advisors utilized by the Company. No more than 350,000 shares of common stock in the aggregate may be issued pursuant to grants of stock awards, stock units, performance shares and other stock-based awards. No more than 300,000 shares of common stock with respect to awards may be granted to any individual during any fiscal year. The Compensation Committee of the Board of Directors determines the vesting period at the time of grant. As of December 28, 2013, under the 2007 Plan, 34,100 shares of common stock were available for future grants and options to purchase 74,400 shares of common stock, as well as 300,000 restricted stock units, were outstanding.

Restricted Stock Units

On November 16, 2012, the Company granted 350,000 restricted stock units all of which fully vest after three years of continued service. All of these restricted stock units include dividend accrual equivalents, which means that any dividends paid by the Company during the three year vesting period become due and payable after the three year vesting period assuming the grantee’s restricted stock unit fully vests. Dividends for these grants are accrued on the dividend payment dates and included in accounts payable and accrued expenses on the accompanying consolidated balance sheet. Dividends for restricted share units that ultimately do not vest are forfeited.

To date, the Company has only issued restricted stock units under the 2007 Plan. The following summarizes the restricted stock units activity under the 2007 Plan during 2013:

	Number of Restricted Stock Units (in thousands)			Weighted Average Grant Date Fair Value per Share
Outstanding non-vested at December 29, 2012		350		$	5.62
Granted		40
Vested		(50	)
Forfeited or expired		(40	)
Outstanding non-vested at December 28, 2013		300		$	5.72

Based on the closing price of the Company’s common stock of $6.95 per share on December 27, 2013, the intrinsic value of the non-vested restricted stock units at December 28, 2013 was $2.1 million. As of December 28, 2013, there was approximately $1.0 million of total unrecognized compensation cost related to restricted stock units, which is expected to be recognized over a weighted-average period of approximately 22.5 months.

Stock Option Awards

Transactions related to all stock options under all plans are as follows:

	All Stock Options Outstanding
	Shares			Weighted Average Exercise Price
Options outstanding as of December 31, 2011		916,594		$	4.24
Options granted		55,000		$	5.54
Options exercised, net		(392,376	)	$	3.85
Options forfeited in cashless exercises		(243,268	)
Options forfeited/cancelled		(28,550	)	$	3.88
Options outstanding as of December 29, 2012		307,400		$	5.34
Options exercisable as of December 29, 2012		252,400		$	5.29
Intrinsic value of outstanding stock options as of December 29, 2012	$	167
Intrinsic value of stock options exercised in fiscal year ended December 29, 2012	$	1,468
Weighted average grant date fair value of stock options issued during fiscal year ended December 29, 2012	$	2.85
Options outstanding as of December 29, 2012		307,400		$	5.34
Options granted		5,000		$	5.78
Options exercised, net		(27,500	)	$	4.15
Options forfeited/cancelled		(8,000	)	$	5.16
Options outstanding as of December 28, 2013		276,900		$	5.47
Options exercisable as of December 28, 2013		221,900		$	5.45
Intrinsic value of outstanding stock options as of December 28, 2013	$	504
Intrinsic value of stock options exercised in fiscal year ended December 28, 2013	$	44
Weighted average grant date fair value of stock options issued during fiscal year ended December 28, 2013	$	2.94

A summary of the status of our nonvested stock options outstanding as of December 28, 2013, and changes during the year then ended is presented as follows:

Nonvested Stock Options	Shares			Weighed-Average Grant-Date Fair Value
Nonvested at December 29, 2012		55,000		$	2.85
Vested		0
Forfeited		(5,000	)	$	2.88
Issued nonvested		5,000		$	2.94
Nonvested at December 28, 2013		55,000		$	2.86

The following table summarizes information about stock options outstanding at December 28, 2013:

Range of Exercise Prices			Number of Outstanding Options				Weighted-Average Remaining Contractual Life				Weighted-Average Exercise Price
			Outstanding		Vested		Outstanding		Vested		Outstanding		Vested
$2.50	-	$2.50		1,000		1,000		5.96		5.96	$	2.50	$	2.50
$4.16	-	$5.78		233,400		178,400		3.41		1.80	$	4.82	$	4.60
$6.44	-	$9.16		17,500		17,500		1.06		1.06	$	8.01	$	8.01
$9.81	-	$9.81		25,000		25,000		3.55		3.55	$	9.81	$	9.81
				276,900		221,900		3.28		1.96	$	5.47	$	5.45

Employee Stock Purchase Plan

The Company implemented the 2001 Employee Stock Purchase Plan (the “Purchase Plan”) with shareholder approval, effective January 1, 2001. Under the Purchase Plan, employees meeting certain specific employment qualifications are eligible to participate and can purchase shares of common stock semi-annually through payroll deductions at the lower of 85% of the fair market value of the stock at the commencement or end of the offering period. The purchase plan permits eligible employees to purchase shares of common stock through payroll deductions for up to 10% of qualified compensation. During the fiscal years ended December 28, 2013 and December 29, 2012, there were 58,176 and 29,205 shares issued under the Purchase Plan for net proceeds of $259 and $128, respectively. As of December 28, 2013, there were 189,576 shares available for issuance under the Purchase Plan. Compensation expense, representing the discount to the quoted market price, for the Purchase Plan for the fiscal years ended December 28, 2013 and December 29, 2012 was $106 and $65, respectively.