Note 6 - Stock-based Compensation

9 Months Ended

Nov. 27, 2016

Notes to Financial Statements

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

6 . STOCK - BASED COMPENSATION

As of

November

27,

2016,

the Company had a

2002

Stock Option Plan (the “Plan”), and no other stock - based compensation plan. The Plan has been approved by the Company’s shareholders and provides for the grant of stock options to directors and key employees of the Company. All options granted under the Plan have exercise prices equal to the fair market value of the underlying common stock of the Company at the time of grant, which, pursuant to the terms of the Plan, is the reported closing price of the common stock on the New York Stock Exchange on the date preceding the date the option is granted. Options granted under the Plan become exercisable

25%

one

year after the date of grant, with an additional

25%

exercisable each succeeding anniversary of the date of grant, and expire

10

years after the date of grant. The Plan expires on

May

21,

2018.

During the

39

weeks ended

November

27,

2016,

the Company granted an option to purchase

1,250

shares of common stock to

one

of its employees. The future compensation expense to be recognized in earnings before income taxes was

$4

and will be recorded on a straight - line basis over the requisite service period. The fair value of the granted option was

$3.15

per share using the Black - Scholes option pricing model with the following assumptions: risk free interest rate of

1.77%;

expected volatility factor of

28.9%;

expected dividend yield of

2.23%;

and estimated option term of

5.3

years.

The risk - free interest rates were based on U.S. Treasury rates at the date of grant with maturity dates approximately equal to the estimated term of the option at the date of the grant. Volatility factors were based on historical volatility of the Company’s common stock. The expected dividend yields were based on the regular quarterly cash dividend per share most recently declared by the Company and on the exercise price of the option granted during the

39

weeks ended

November

27,

2016.

The estimated term of the option was based on evaluations of the historical and expected future employee exercise behavior.

The following is a summary of option activity for the

39

weeks ended

November

27,

2016:

	Outstanding Options			Weighted Average Exercise Price
Balance, February 29, 2016		1,226,392		$	22.51
Granted		1,250			14.07
Exercised		-			-
Terminated or expired		(150,314	)		21.76
Balance, November 27, 2016		1,077,328		$	21.05
Vested and exercisable, November 27, 2016		679,329		$	22.42