Note 5 - Stock-based Compensation

6 Months Ended

Jun. 30, 2013

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

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

NOTE 5 – STOCK-BASED COMPENSATION

Stock Option Awards

In accordance with accounting standards, the Company measures the cost of employee services received in exchange for an award of equity instruments based on the grant date fair value of the award. That cost will be recognized over the period in which the employee is required to provide the services – the requisite service period (usually the vesting period) – in exchange for the award. The grant date fair value for options and similar instruments will be estimated using option pricing models. Under accounting standards, the Company is required to select a valuation technique or option pricing model that meets the criteria stated in the standard. The Company uses the Black-Scholes model. Accounting standards require that the Company estimate forfeitures for stock options and reduce compensation expense accordingly. The Company has reduced its stock compensation expense by the assumed forfeiture rate and will evaluate experience against this forfeiture rate going forward.

During the first six months of 2013 and 2012, the Company recognized stock option compensation costs of $0.1 million and $0.4 million, respectively. In the second quarters of 2013 and 2012, the Company recognized stock option compensation costs of $0.1 million and $0.2 million, respectively. The remaining unrecognized compensation cost related to unvested awards at June 30, 2013, approximated $0.1 million, and the weighted average period of time over which this cost will be recognized is approximately one year.

The following table summarizes stock options outstanding as of June 30, 2013, as well as activity during the six months then ended:

	Shares		Weighted Average Exercise Price
Outstanding at December 30, 2012		393,500	$	9.12
Granted		0		0
Exercised		94,000		9.44
Forfeited or canceled		8,500		2.71
Outstanding at June 30, 2013		291,000	$	8.39
Exercisable at June 30, 2013		286,000	$	8.54

At June 30, 2013, the aggregate intrinsic value of in-the-money options outstanding and options exercisable was $2.5 million and $2.5 million, respectively (the intrinsic value of a stock option is the amount by which the market value of the underlying stock exceeds the exercise price of the option).

Cash proceeds and intrinsic value related to total stock options exercised during the first six months of fiscal years 2013 and 2012 are provided in the table below. The Company did not recognize any significant tax benefit with regard to stock options in either period presented.

	Six Months Ended
	June 30, 2013		July 1, 2012
	(In thousands)
Proceeds from stock options exercised	$	1,256	$	131
Intrinsic value of stock options exercised		741		179

Restricted Stock Awards

During the six months ended June 30, 2013, and July 1, 2012, the Company granted restricted stock awards for 598,000 and 573,500 shares, respectively, of common stock. These awards (or a portion thereof) vest with respect to each recipient over a two to five year period from the date of grant, provided the individual remains in the employment or service of the Company as of the vesting date. Additionally, awards (or a portion thereof) could vest earlier upon the attainment of certain performance criteria, in the event of a change in control of the Company, or upon involuntary termination without cause.

Compensation expense related to restricted stock grants was $2.6 million and $2.2 million for the six months ended June 30, 2013, and July 1, 2012, respectively. Accounting standards require that the Company estimate forfeitures for restricted stock and reduce compensation expense accordingly. The Company has reduced its expense by the assumed forfeiture rate and will evaluate experience against this forfeiture rate going forward.

The following table summarizes restricted stock activity as of June 30, 2013, and during the six months then ended:

	Shares		Weighted Average Grant Date Fair Value
Outstanding at December 30, 2012		1,973,500	$	14.79
Granted		598,000		16.05
Vested		393,000		14.67
Forfeited or canceled		484,500		14.06
Outstanding at June 30, 2013		1,694,000	$	15.47

As of June 30, 2013, the unrecognized total compensation cost related to unvested restricted stock was approximately $14.3 million. That cost is expected to be recognized by the end of 2016.

For the six months ended June 30, 2013, and July 1, 2012, the Company recognized tax benefits with regard to restricted stock of $1.3 million and $0.3 million, respectively.