11.	SHARE BASED COMPENSATION

January 2, 2021,

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 typically vest over periods ranging from

one

three

years and expire within

years of issuance. The Company

may

also issue immediately vested equity awards. 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

$1,109

and

$806

was recognized for the fiscal years ended

January 2, 2021

and

December 28, 2019,

respectively. Fiscal year ended

January 2, 2021

did

not

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

December 28, 2019

included estimated expense of

$228

for performance-based awards. As of

January 2, 2021,

there were

performance-based restricted stock awards outstanding.

As of

January 2, 2021,

the Company had

$1.1

million of total unrecognized compensation cost related to all time-based non-vested share-based awards outstanding. The Company expects to recognize this expense over approximately

two

years. These amounts do

not

include a) the cost of any additional share-based awards granted in future periods or b) 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,

initially provided 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

and fiscal

2020,

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

and

850,000

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

1,975,000

shares. The expiration date of the Plan is

December 17, 2030,

unless the

2014

Plan is terminated earlier by the Board or is extended by the Board with the approval of the stockholders. The Compensation Committee of the Board of Directors determines the vesting period at the time of grant.

As of

January 2, 2021,

under the

2014

Plan,

709,805

time-based shares were outstanding, there were

performance-based restricted share awards outstanding and

520,929

shares were available for awards thereunder.

The market value of equity grants for the

fifty-three

week period ended

January 2, 2021

and the

fifty-two

week period ended

December 28, 2019

was

$1.5

million and

$1.1

million respectively.

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

2015,

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

1,100,000

shares and to extend the expiration date of the Plan to

December 31, 2025.

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. Actual shares are issued on the

first

business day of the subsequent offering period for the prior offering period payroll deductions. During the fiscal years ended

January 2, 2021

and

December 28, 2019,

there were

117,983

and

118,526

shares issued under the Purchase Plan for net proceeds of

$208

and

$321,

respectively. As of

January 2, 2021,

there were

149,894

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

January 2, 2021

and

December 28, 2019

was

$44

and

$91,

respectively.

Time-Based Restricted Stock Awards / Stock Subscription Receivable

From time-to-time the Company issues time-based restricted stock awards. These time-based restricted stock awards 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 award fully vests. Dividends for these grants are accrued on the dividend payment dates and included in accounts payable and accrued expenses on the accompanying condensed consolidated balance sheet. As of

January 2, 2021,

there were

accrued dividends. Dividends for time-based restricted stock awards that ultimately do

not

vest are forfeited.

The following summarizes the activity in the time-based restricted stock awards under the

2014

Plan during the

fifty-three

week period ended

January 2, 2021:

	Number of Time-Based Restricted Stock Awards			Weighted Average Grant Date Fair Value per Share
Outstanding non-vested at December 28, 2019		151,725		$	3.64
Granted		719,805		$	1.88
Vested		(139,225	)	$	3.61
Forfeited or expired		(22,500	)	$	1.55
Outstanding non-vested at January 2, 2021		709,805		$	1.92

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

$2.07

per share on

December 31, 2020 (

the last trading day prior to

January 2, 2021),

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

January 2, 2021

was approximately

$1.5

million. As of

January 2, 2021,

there was approximately

$1.1

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

Time-Based Restricted Stock Awards / Stock Subscription Receivable (Continued)

December 2020,

the Company granted senior management a

one

-time restricted stock award of

250,000

shares in exchange for a stock subscription receivable. The shares will be acquired by senior management through repayment of the stock subscription receivable over

twelve

months beginning in

January 2021

and ending in

December 2021.

During fiscal

2020,

the Company awarded

100,092

immediately vested share awards at an average price of

$1.33.

Performance-Based Restricted Stock Awards

From time-to-time the Company issues performance-based restricted stock awards to its executives. Performance-based restricted stock awards are typically vested based on certain multi-year performance metrics as determined by the Board of Directors Compensation Committee. These performance-based restricted stock awards 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 awards 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 condensed consolidated balance sheet. As of

January 2, 2021,

there were

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

not

vest are forfeited.

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

2014

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

fifty-three

week period ended

January 2, 2021:

	Number of Performance-Based Restricted Stock Awards			Weighted Average Grant Date Fair Value per Share
Outstanding non-vested at December 28, 2019		240,000		$	4.81
Granted		-			-
Vested		(40,000	)	$	4.38
Forfeited or expired		(200,000	)	$	4.89
Outstanding non-vested at January 2, 2021		-			-

As of

January 2, 2021,

there were

outstanding performance-based restricted stock awards. 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 awards deemed as likely to vest are deemed as unlikely to vest, the expense recognized will be reversed.

	Number of Restricted Stock Awards			Weighted Average Grant Date Fair Value per Share
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
Granted – time-based vesting		719,805		$	1.88
Granted – performance-based vesting		-			-
Vested		(179,225	)	$	3.78
Forfeited or expired		(222,500	)	$	4.55
Outstanding non-vested at January 2, 2021		709,805		$	1.92

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

$2.07

per share on

December 31, 2020,

the intrinsic value of all restricted share awards at

January 2, 2021

was

$1.5

million. This amount does

not

include any intrinsic value that

may

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