11.	SHARE BASED COMPENSATION

December 28, 2019,

the Company had

two

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

three

years and expire within

years of issuance. Share-based compensation expense related to time-based awards is amortized in accordance with applicable vesting periods using the straight-line method. The Company expenses performance-based awards only when the performance metrics are likely to be achieved and the associated awards are therefore likely to vest. Performance-based share awards that are likely to vest are also expensed on a straight-line basis over the vesting period but

may

vest on a retroactive basis or be reversed, depending on when it is determined that they are likely to vest, or in the case of a reversal when they are later determined to be unlikely to vest.

Share-based compensation expense of

$806

and

$544

was recognized for the fiscal years ended

December 28, 2019

and

December 29, 2018,

respectively. Share based compensation for the fiscal year ended

December 28, 2019

included estimated expense of

$228

for performance-based awards, and did

not

include any expense associated with performance-based awards for the fiscal year ended

December 29, 2018.

As of

December 28, 2019,

the Company had

$0.3

million of total unrecognized compensation cost related to all time-based non-vested share-based awards and performance-based restricted stock units outstanding and deemed as likely to vest. The Company expects to recognize this expense over approximately

two

years. These amounts do

not

include a) performance-based restricted stock units deemed unlikely to vest, b) the cost of any additional share-based awards granted in future periods or c) the impact of any potential changes in the Company’s forfeiture rate.

2014

Omnibus Equity Compensation Plan (the

2014

Plan)

The

2014

Plan, approved by the Company’s shareholders in

December 2014,

provides for the issuance of up to

625,000

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. In fiscal

2016,

the Company amended and restated the

2014

Plan with shareholder approval to increase the aggregate number of shares of stock reserved for issuance under the Plan by an additional

500,000

shares so that the total number of shares of stock reserved for issuance under the Plan is

1,125,000

shares. The expiration date of the Plan is

December 1, 2026.

The Compensation Committee of the Board of Directors determines the vesting period at the time of grant.

As of

December 28, 2019,

under the

2014

Plan,

151,725

time-based and

240,000

performance-based restricted share units were outstanding and

268,326

shares were available for awards thereunder.

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, subject to maximum purchases in any

one

fiscal year of

3,000

shares.

In fiscal

2018,

the Company amended the Purchase Plan with shareholder approval to increase the aggregate number of shares of stock reserved for issuance or transfer under the Plan by an additional

300,000

shares so that the total number of shares of stock reserved for issuance or transfer under the Plan shall be

1,400,000

shares.

The Company has

two

offering periods in the Purchase Plan coinciding with the Company’s

first

two

fiscal quarters and the last

two

fiscal quarters. During the fiscal years ended

December 28, 2019

and

December 29, 2018,

there were

118,526

and

90,877

shares issued under the Purchase Plan for net proceeds of

$321

and

$385,

respectively. As of

December 28, 2019,

there were

267,877

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, 2019

and

December 29, 2018

was

$91

and

$103,

respectively.

Time-Based Restricted Stock Units

From time-to-time the Company issues time-based restricted stock units. These time-based restricted stock units typically include dividend accrual equivalents, which means that any dividends paid by the Company during the vesting period become due and payable after the 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 time-based restricted stock units that ultimately do

not

vest are forfeited.

To date, the Company has issued time-based restricted stock units only under its

2007

Omnibus Equity Compensation Plan and the

2014

Plan. The

2007

Plan has expired and there are

time-based restricted stock units outstanding thereunder. The following summarizes the activity in the time-based restricted stock units under the

2014

Plan during the

fifty-two

week period ended

December 28, 2019:

	Number of Time-Based Restricted Stock Units			Weighted Average Grant Date Fair Value per Share
Outstanding non-vested at December 29, 2018		147,372		$	4.46
Granted		99,225		$	3.02
Vested		(82,872	)	$	4.04
Forfeited or expired		(12,000	)	$	5.84
Outstanding non-vested at December 28, 2019		151,725		$	3.64

Based on the closing price of the Company’s common stock of

$2.87

per share on

December 27, 2019 (

the last trading day prior to

December 28, 2019),

the intrinsic value of the time-based non-vested restricted stock units at

December 28, 2019

was approximately

$0.4

million. As of

December 28, 2019,

there was approximately

$0.3

million of total unrecognized compensation cost related to time-based restricted stock units, which is expected to be recognized over the vesting period of the restricted stock units.

Performance

Based Restricted Stock Units

From time-to-time the Company issues performance-based restricted stock units to its executives. Performance-based restricted stock units are typically vested based on certain multi-year performance metrics as determined by the Board of Directors Compensation Committee. These performance-based restricted stock units typically include dividend accrual equivalents, which means that any dividends paid by the Company during the vesting period become due and payable after the vesting period on any stock units that actually vest, if any. 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. As of

December 28, 2019,

there were

accrued dividends. Dividends for performance-based restricted stock units that ultimately do

not

vest are forfeited.

To date, the Company has issued performance-based restricted stock units only under the

2014

Plan. The following summarizes the activity in the performance-based restricted stock units during the

fifty-two

week period ended

December 28, 2019:

Performance

Based Restricted Stock Units

(Continued)

	Number of Performance- Based Restricted Stock Units			Weighted Average Grant Date Fair Value per Share
Outstanding non-vested at December 29, 2018		200,000		$	4.94
Granted		167,148		$	4.35
Vested		(47,148	)	$	3.68
Forfeited or expired		(80,000	)	$	4.85
Outstanding non-vested at December 28, 2019		240,000		$	4.81

As of

December 28, 2019,

the Company considers the metrics related to

200,000

of the performance-based restricted stock units unlikely to be achieved, thus

performance condition is probable of achievement and

compensation cost has been recognized on these performance-based restricted stock units. As of

December 28, 2019,

the Company considers the metrics related to

40,000

of the performance-based restricted stock units likely to be achieved, and therefore

$175

of compensation cost has been recognized on these likely to vest performance-based restricted stock units during the fiscal year

2019.

The Company will reassess at each reporting date whether achievement of any performance condition is probable and would begin recognizing additional compensation cost if and when achievement of the performance condition becomes probable. The Company will then recognize the appropriate expense cumulatively in the year performance becomes probable and recognize the remaining compensation cost over the remaining requisite service period. If at a later measurement date the Company determines that performance-based restricted stock units deemed as likely to vest are deemed as unlikely to vest, the expense recognized will be reversed. As of

December 28, 2019,

there was approximately

$0.8

million of total unrecognized compensation cost related to performance-based restricted stock units deemed likely to vest.

	Number of Restricted Stock Units			Weighted Average Grant Date Fair Value per Share
Outstanding non-vested at December 30, 2017		487,034		$	5.24
Granted – time-based vesting		95,372		$	4.05
Granted – performance-based vesting		240,000		$	5.33
Vested		(29,195	)	$	6.85
Forfeited or expired		(445,839	)	$	5.32
Outstanding non-vested at December 29, 2018		347,372		$	4.74
Granted – time-based vesting		99,225		$	3.02
Granted – performance-based vesting		167,148		$	4.35
Vested		(130,020	)	$	3.91
Forfeited or expired		(92,000	)	$	4.98
Outstanding non-vested at December 28, 2019		391,725		$	4.36

Based on the closing price of the Company’s common stock of

$2.87

per share on

December 27, 2019,

the intrinsic value of the non-vested time-based restricted share units at

December 28, 2019

was

$0.4

million. This amount does

not

include any intrinsic value that

may

be associated with the performance-based restricted share units that are deemed unlikely to vest.