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Share-Based Compensation | 12 Months Ended
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Dec. 29, 2018
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] |
Share-Based Compensation | Share-Based Compensation We have three stock-based compensation plans covering officers, directors, certain employees, and consultants: the 2004 Equity Incentive Plan (the “2004 Plan”), the 2006 Long-Term Equity Incentive Plan (the “2006 Plan”), and the 2016 Amended and Restated Long-Term Incentive Plan (the “2016 Plan”). The plans are designed to motivate and retain individuals who are responsible for the attainment of our primary long-term performance goals. The plans provide a means whereby the participants develop a further sense of proprietorship and personal involvement in our development and financial success, thereby advancing the interests of the Company and its stockholders. Although we do not have a formal policy on the matter, we issue new shares of our common stock to participants upon the exercise of options or upon the vesting of restricted stock, restricted stock units, or performance shares, out of the total amount of common shares applicable for issuance or vesting under the aforementioned plans. Shares are available for new issuance only under the 2016 Plan. The 2006 and 2004 Plans have no shares remaining for issuance. Remaining 2006 Plan shares are outstanding only for the vesting of outstanding equity awards and the exercise of currently outstanding options, and 2004 Plan shares are outstanding only for the exercise of currently outstanding options. The 2016 Plan permits the grant of nonqualified stock options, incentive stock options, stock appreciation rights (“SARs”), restricted stock, restricted stock units, performance shares, performance units, cash-based awards, and other share-based awards to participants of the 2016 Plan selected by our Board of Directors or a committee of the Board that administers the 2016 Plan. We reserved 810,200 shares of our common stock for issuance under the 2016 Plan. The terms and conditions of awards under the 2016 Plan are determined by the Compensation Committee. Some of the awards issued under both the 2016 and 2006 Plans are subject to accelerated vesting in the event of a change in control as such an event is defined in the respective Plan documents. For all awards designated as equity awards, we recognize compensation expense equal to the grant-date fair value for all share-based payment awards that are expected to vest, as described further below, in “Compensation Expense”. This expense is recorded on a straight-line basis over the requisite service period of the entire award, unless the awards are subject to market or performance conditions, in which case we recognize compensation expense over the requisite service period of each separate vesting tranche, to the extent the occurrence of such conditions are probable. Outstanding awards designated as liability awards primarily consisted of Cash-Settled Stock Appreciation Rights (“cash-settled SARs”), where we intend to settle the remaining portion of the awards in cash on or before the August 15, 2019 payment deadline. To value the cash-settled SARs, we utilized the Black-Scholes-Merton option pricing model (“Black-Scholes”), and recorded quarterly expense attributions of the awards based on estimates of the fair market value of the awards at the end of each quarter during the service period. The Black-Scholes model required the input of highly subjective assumptions such as the expected stock price volatility. Additionally, we amended an award agreement for 1,500 performance shares for which the service component of the agreement was waived, which required reclassification as liability awards. These performance shares are marked to market on a quarterly basis, based on the closing price of our common stock on the last trading day of the quarter. All compensation expense related to our share-based payment awards is recorded in “Selling, general, and administrative” expense in the Consolidated Statements of Operations and Comprehensive Income (Loss). Cash-Settled SARs During fiscal 2016, we granted certain executives and employees cash-settled SARs. The cash-settled SARs vested on July 16, 2018. On the vesting date, half of the vested value of the cash-settled SARs became payable within thirty days of the vesting date, and the remainder payable not later than August 15, 2019. The exercise price for the cash-settled SARs was amended so that it was based on a 20-day trading average of the Company’s common stock through the vesting date, in excess of the $7.00 grant date valuation. The accrued liability for the remaining half payable in fiscal 2019 was $6.8 million. During fiscal 2017, certain individuals were no longer employed with the Company, and their cash-settled SAR agreements allowed for a partial accelerated vesting (of 27,385 cash-settled SARs); and a partial forfeiture (of 20,615 cash-settled SARs), pro-rated based on employment dates. At that time, half the accelerated vested value of the cash-settled SARs, as valued at the closing stock price on the deemed exercise date, was paid to those participants, with the remaining half payable on July 16, 2019. These payments, and the accrued liability for the remaining half payable in fiscal 2019, were immaterial. At December 29, 2018, there were 445,000 cash-settled SARs issued and outstanding, and we recognized expense of approximately $13.2 million, $0.6 million and $0.4 million in fiscal 2018, 2017, and 2016, respectively, related to these awards. The following table summarizes the assumptions used to compute the current fair value of our cash-settled SARs:
|  | December 29, 2018 |  | December 30, 2017
Expected volatility |  | Not applicable |  | 33.80 | %
Risk-free interest rate |  | Not applicable |  | 1.55 | %
Expected term (in years) |  | Not applicable |  | 0.54 |
Expected dividend yield |  | Not applicable |  | Not applicable |
Restricted Stock, Restricted Stock Units, Performance Shares, and Stock Options Restricted Stock During fiscal 2018, we did not grant any restricted stock awards. Our sole remaining outstanding restricted stock award as of December 29, 2018, was due to vest and/or vested in equal annual increments over three years, of which January 13, 2018 was the final date of incremental vesting. Restricted stock awards that vested during fiscal 2017 had either vested in equal annual increments over three years, or had cliff-vested three years after the date of grant. These awards were time-based and were not based upon attainment of performance goals. As of December 29, 2018, there was no remaining unrecognized compensation expense related to restricted stock. As of December 29, 2018, the weighted average remaining contractual term for our restricted stock was zero, due to final incremental vesting on January 13, 2018, and the maximum contractual term was 3.0 years. The following table summarizes activity for our restricted stock awards during fiscal 2018:
| Restricted Stock Awards
| Number of Awards |  | Weighted Average Fair Value
Outstanding as of December 30, 2017 | 16,667 |  |  | $ | 9.90 |
Granted | — |  |  | — |
Vested (1) | (16,667 | ) |  | 9.90 |
Forfeited | — |  |  | — |
Outstanding as of December 29, 2018 | — |  |  | $ | — |
(1) | The total fair value vested in fiscal 2018, fiscal 2017, and fiscal 2016 was $0.2 million, $1.2 million, and $1.1 million, respectively.
Restricted Stock Units During fiscal 2018, and in prior years, the Board of Directors was granted restricted stock units with a one-year vesting period, although a pro-rated portion may vest prior to the one-year period, with the remainder forfeited, if a Director chooses not to stand for re-election before the one-year vesting period has elapsed. All vested director grants settle at the earlier of ten years from the vesting date or retirement from the Board of Directors. These awards are time-based and are not based upon attainment of performance goals. During fiscal year 2018, the Board of Directors granted restricted stock units to certain of our employees and executive officers. Certain of the restricted stock units vest in equal annual increments over the three years after the date of grant, and the remaining restricted stock units vest on the third anniversary of the date of grant if certain performance conditions are met prior to the vesting date.One tranche of restricted stock units was granted to an executive officer during fiscal 2017, with a vesting date three years after the date of grant. Outstanding restricted stock units granted prior to fiscal 2017 to employees and executive officers vest either in equal annual increments over three years or between two and three years after the date of grant. As of December 29, 2018, there was approximately $4.9 million of total unrecognized compensation expense related to restricted stock units. The unrecognized compensation expense is expected to be recognized over a weighted average term of 1.8 years. As of December 29, 2018, the weighted average remaining contractual term for our restricted stock units was 1.8 years, and the maximum contractual term was 3.0 years. The following table summarizes activity for our restricted stock units during fiscal 2018:
| Restricted Stock Units
| Number of Awards |  | Weighted Average Fair Value
Outstanding as of December 30, 2017 | 242,362 |  |  | $ | 7.41 |
Granted | 198,487 |  |  | 33.46 |
Vested (1) | (228,029 | ) |  | 7.42 |
Forfeited | (18,598 | ) |  | 15.06 |
Outstanding as of December 29, 2018 | 194,222 |  |  | $ | 33.29 |
(1) | The total fair value of restricted stock units vested in fiscal 2018, 2017, and 2016 was $1.7 million, $0.7 million and $0.6 million, respectively.
Performance shares During fiscal year 2015, the Board of Directors granted certain of our executive officers and employees awards of performance shares of our common stock. The performance shares were released upon the successful achievement of specific, measurable performance criteria approved by the Compensation Committee, and the satisfaction of a service condition in fiscal 2018. There were no performance shares granted during fiscal 2018. The following table summarizes activity for our performance share awards during fiscal 2018:
| Performance Shares
| Number of Awards |  | Weighted Average Fair Value
Outstanding as of December 30, 2017 | 60,000 |  |  | $ | 9.29 |
Granted | — |  |  | — |
Vested (1) | (59,000 | ) |  | 9.28 |
Forfeited | (1,000 | ) |  | 9.80 |
Outstanding at December 29, 2018 | — |  |  | $ | — |
(1) | No performance share awards vested in fiscal 2017. The total fair value vested in fiscal 2018 and 2016 was $0.5 million and $1.6 million, respectively.
Stock Options The tables below summarize activity and include certain additional information related to our outstanding stock options granted under the 2004 Plan and 2006 Plan for the year ended December 29, 2018. The maximum contractual term for stock options was ten years from the grant date, and the remaining outstanding final tranche of options as of December 29, 2018, presented below, expired on March 10, 2018. There were no new employee stock option grants and no stock option exercises during fiscal years 2018, 2017, and 2016.
| Options
| Shares |  | Weighted Average Exercise Price
Outstanding as of December 30, 2017 | 75,000 |  |  | $ | 46.60 |
Granted | — |  |  | — |
Exercised | — |  |  | — |
Forfeited | — |  |  | — |
Expired | (75,000 | ) |  | 46.60 |
Outstanding and exercisable as of December 29, 2018 | — |  |  | $ | — |
Compensation Expense Total share-based compensation expense from our share-based awards was as follows:
| December 29, 2018 |  | December 30, 2017 |  | December 31, 2016
| (In thousands)
Restricted Stock and Restricted Stock Units | $ | 1,350 |  |  | $ | 1,406 |  |  | $ | 1,872 |
Performance Shares | 788 |  |  | 452 |  |  | 92 |
Cash-settled Stock Appreciation Rights | 13,173 |  |  | 622 |  |  | 375 |
Stock Options | — |  |  | — |  |  | — |
Total | $ | 15,311 |  |  | $ | 2,480 |  |  | $ | 2,339 |
We recognized related income tax benefits in fiscal years 2018, 2017, and 2016 of $3.9 million, $1.0 million, and $0.9 million, respectively, which were fully realized in fiscal 2018 and 2017, and offset by a valuation allowance during fiscal 2016. We present the benefits of tax deductions in excess of recognized compensation expense as a net operating cash outflow in our Consolidated Statements of Cash Flows when present. There was an excess tax benefit of $1.5 million in fiscal 2018, and were no material excess tax benefits in fiscal years 2017 and 2016.

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- Definition The entire disclosure for compensation-related costs for equity-based compensation, which may include disclosure of policies, compensation plan details, allocation of equity compensation, incentive distributions, equity-based arrangements to obtain goods and services, deferred compensation arrangements, employee stock ownership plan details and employee stock purchase plan details. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 718 -URI http://asc.fasb.org/topic&trid=2228938 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 50 -URI http://asc.fasb.org/subtopic&trid=2208855 + Details
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