Share-Based Compensation

Performance-Based Restricted Stock Units. Our Board of Directors (the “Board”) approved a performance-based equity compensation arrangement for our executive officers during the first quarters of each of fiscal 2018 and fiscal 2017. These performance-based arrangements provide for the grant of performance-based restricted stock units that represent a possible future issuance of restricted shares of our common stock based on a pre-tax income target for the applicable fiscal year. The actual number of restricted shares to be issued to each executive officer is determined when our final financial information becomes available after the applicable fiscal year and will be between zero shares and 57,855 shares in the aggregate for fiscal 2018. The restricted shares issued will fully vest two years after the last day of the fiscal year on which the performance is based. We are recording the compensation expense for the outstanding performance share units and the converted restricted stock over the life of the awards.

The following table represents the restricted stock activity for the six months ended October 1, 2017:



	Shares		Weighted- Average Grant Date Fair Value
Unvested at beginning of period	28,853		$	43.10
Granted	35,075		47.50
Forfeited or expired	(9,220	)	45.45
Unvested at end of period	54,708		$	45.52

We recorded compensation expense related to performance share units and restricted stock of $0.3 million and $0.5 million for the three and six months ended October 1, 2017, respectively. We recorded compensation expense related to performance share units and restricted stock of $0.4 million and $0.8 million for the three and six months ended October 2, 2016, respectively. Substantially all of the compensation expense was recorded in selling, general and administrative expenses in the condensed consolidated statements of income.

Restricted Stock Awards. As part of their retainer, each non-employee director receives an annual grant of restricted stock for their Board of Director services. The restricted stock awards are expensed over the requisite vesting period, which is one year from the date of issuance, based on the market value on the date of grant. As of October 1, 2017, there were 8,484 shares of restricted stock with a weighted averaged grant date fair value of $41.25 outstanding under this program. Compensation expense for both of the three month periods ended October 1, 2017 and October 2, 2016 related to restricted stock awards to the Board was $0.1 million. Compensation expense for the six months ended October 1, 2017 and October 2, 2016 related to restricted stock awards to the Board was $0.2 million and $0.1 million, respectively.