Note 7 Shareholders' Equity

6 Months Ended

Jun. 29, 2014

Equity [Abstract]

Note 7 Shareholders' Equity

7. SHAREHOLDERS’ EQUITY

a. Common Stock

In the three-month and six-month periods ended June 29, 2014, we issued 14,153 and 28,792 shares of common stock to our non-employee directors, respectively, valued at $57 and $114, respectively.

b. Stock Options

We have stock options outstanding from various stock-based employee compensation plans, for which we record compensation cost relating to share-based payment transactions in our financial statements. The cost is measured at the grant date, based on the fair value of the award, and is recognized as an expense over the employee’s requisite service period (generally the vesting period of the equity award). Compensation cost related to stock options was $198 and $200 for the three-month periods ended June 29, 2014 and June 30, 2013, respectively. Compensation cost related to stock options was $371 and $390 for the six-month periods ended June 29, 2014 and June 30, 2013, respectively. As of June 30, 2014, there was $766 of total unrecognized compensation cost related to outstanding stock options, which is expected to be recognized over a weighted average period of 1.4 years.

The following table summarizes stock option activity for the first quarter of 2014:

	Number of Shares			Weighted Average Exercise Price		Weighted Average Remaining Contractual Term (years)		Aggregate Intrinsic Value
Outstanding at January 1, 2014		2,131,622		$	6.99
Granted		252,500			3.94
Exercised		(2,900	)		3.69
Forfeited		(28,630	)		3.95
Expired		(80,669	)		7.85
Outstanding at June 29, 2014		2,271,923			6.61		3.97	$	227
Vested and expected to vest at
June 29, 2014		2,077,123			6.82		3.90	$	186
Exercisable at June 29, 2014		1,247,185		$	6.14		3.06	$	82

The following assumptions were used to value stock options granted during the six months ended June 29, 2014:

Risk-free interest rate	1.10	%
Volatility factor	59.94	%
Dividends	0.00	%
Weighted average expected life (years)	4.15

Cash flows from excess tax benefits are required to be classified as a part of cash flows from financing activities. Excess tax benefits are realized tax benefits from tax deductions for exercised stock options in excess of the deferred tax asset attributable to stock compensation costs for such stock options. We did not record any excess tax benefits in the first six months of 2014 and 2013. Cash received from stock option exercises under our stock-based compensation plans for the three-month periods ended June 29, 2014 and June 30, 2013 was $11 and $0, respectively. Cash received from stock option exercises for the six-month periods ended June 29, 2014 and June 30, 2013 was $11 and $12, respectively.

c. Restricted Stock Awards

No restricted stock was awarded during the three or six month periods ending June 29, 2014. Included in stock compensation expense recorded in our financial statements in the three and six months ended June 29, 2014 was $34 and $83, respectively, relating to the restricted stock units held by our President and Chief Executive Officer. There was $40 in stock compensation expense relating to restricted stock awards in both the three and six month periods ended June 30, 2013. There is $67 of unrecognized compensation cost related to restricted stock units as of June 29, 2014. 30,000 shares of restricted stock units vested during the first six months of 2014.