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Note 9. Share-Based Compensation
 3 Months Ended
Mar. 31, 2013
Disclosure of Compensation Related Costs, Share-based Payments [Text Block]
9.  Share-Based Compensation

Share-based compensation expense, which includes stock options and restricted stock units, was $0.1 million for each of the three months ended March 31, 2013 and April 1, 2012.

Stock Options  

The Company uses the Black Scholes option pricing model to estimate the fair value and compensation cost associated with employee incentive stock options which requires the consideration of historical employee exercise behavior data and the use of a number of assumptions including volatility of the Company’s stock price, the weighted average risk-free interest rate and the weighted average expected life of the options. There were 443,500 options granted during the three months ended March 31, 2013.  There were no options granted during the three months ended April 1, 2012.

The following table summarizes Lakes’ stock option activity during the three months ended March 31, 2013 and April 1, 2012:

 
 
Number of Common Shares
       
 
 
 
Options
Outstanding
   
 
 
Exercisable
   
 
Available
for Grant
   
Weighted-Average
Exercise
Price
 
2013
                       
Balance at December 30, 2012
    1,528,039       1,298,809       875,627     $ 3.04  
Forfeited/cancelled/expired
    (53,058 )             53,058       3.40  
Granted     443,500               (443,500 )     3.07  
Balance at March 31, 2013
    1,918,481       1,245,751       485,185        2.94  
                                 
2012
                               
Balance at January 1, 2012
    1,644,639       1,155,347       874,627     $ 2.92  
Forfeited/cancelled/expired
    (116,600 )             1,000       2.88  
Balance at April 1, 2012
    1,528,039       1,081,249       875,627       2.92  

As of March 31, 2013, the options outstanding had a weighted average remaining contractual life of 7.5 years, weighted average exercise price of $2.94 and aggregate intrinsic value of $0.5 million.  The options exercisable have a weighted average exercise price of $3.03, a weighted average remaining contractual life of 6.6 years and aggregate intrinsic value of $0.4 million as of March 31, 2013.

There were no options exercised during the three months ended March 31, 2013 and April 1, 2012.  Lakes’ unrecognized share-based compensation expense related to stock options was approximately $1.0 million as of March 31, 2013, which is expected to be recognized over a weighted-average period of 2.4 years.

Lakes issues new shares of common stock upon the exercise of options.

Restricted Stock Units  

There was no restricted stock activity during the three months ended March 31, 2013.  The following table summarizes Lakes’ restricted stock unit activity during the three months ended April 1, 2012:

 
 
Non-Vested Shares:
 
 
Restricted
Stock Units
   
Weighted-Average
Grant-
Date Fair Value
 
             
2012
           
Balance at January 1, 2012
    38,337     $ 3.25  
Vested
    (38,337 )     3.25  
Balance at April 1, 2012
    —       —  

During the three months ended April 1, 2012, 35,257 common shares were issued upon the vesting of restricted stock units, net of common shares redeemed at the election of the grantee for payroll tax payment.