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Note 11 - Share-based Compensation | 9 Months Ended
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Sep. 28, 2019
Notes to Financial Statements |
Share-based Payment Arrangement [Text Block] |
11. | Share-Based Compensation
At September 28, 2019, the Company had two share-based employee compensation plans. The Company measures the fair value of share-based awards, if and when granted, based on the Black-Scholes method and using the closing market price of the Company’s common stock on the date of grant. Awards vest over periods ranging from one to three years and expire within 10 years of issuance. Share-based compensation expense related to time-based awards is amortized in accordance with applicable vesting periods using the straight-line method. The Company expenses performance-based awards only when the performance metrics are likely to be achieved and the associated awards are therefore likely to vest. Performance-based share awards that are likely to vest are also expensed on a straight-line basis over the vesting period but may vest on a retroactive basis or be reversed, depending on when it is determined that they are likely to vest, or in the case of a reversal when they are later determined to be unlikely to vest. The Company recognized share-based compensation expense of $472 and $322 for the thirty-nine week periods ended September 28, 2019, and September 29, 2018, respectively. During the thirteen week periods ended September 28, 2019 and September 29, 2018, share based compensation expense was $24 and $121, respectively. As of September 28, 2019, all performance-based restricted stock units outstanding were deemed as unlikely to vest. As of September 28, 2019, the Company had $0.1 million of total unrecognized compensation cost related to all time-based non-vested share-based awards and performance-based restricted stock units outstanding and deemed as likely to vest. The Company expects to recognize this expense over approximately two years. These amounts do not include a) performance-based restricted stock units deemed unlikely to vest, b) the cost of any additional share-based awards granted in future periods or c) the impact of any potential changes in the Company’s forfeiture rate. Incentive S hare-Based Plans 2014 Omnibus Equity Compensation Plan (the 2014 Plan) The 2014 Plan, approved by the Company’s shareholders in December 2014, provides for the issuance of up to 625,000 shares of the Company’s common stock to officers, non-employee directors, employees of the Company and its subsidiaries or consultants and advisors utilized by the Company. In fiscal 2016, the Company amended and restated the 2014 Plan with shareholder approval to increase the aggregate number of shares of stock reserved for issuance under the Plan by an additional 500,000 shares so that the total number of shares of stock reserved for issuance under the Plan is 1,125,000 shares. The expiration date of the Plan is December 1, 2026. The Compensation Committee of the Board of Directors determines the vesting period at the time of grant. As of September 28, 2019, under the 2014 Plan, 120,372 time-based and 320,000 performance-based restricted share units were outstanding and 267,551 shares were available for awards thereunder. Employee Stock Purchase Plan The Company implemented the 2001 Employee Stock Purchase Plan (the “Purchase Plan”) with shareholder approval, effective January 1, 2001. Under the Purchase Plan, employees meeting certain specific employment qualifications are eligible to participate and can purchase shares of common stock semi-annually through payroll deductions at the lower of 85% of the fair market value of the stock at the commencement or end of the offering period. The purchase plan permits eligible employees to purchase shares of common stock through payroll deductions for up to 10% of qualified compensation. In fiscal 2015, the Company amended the Purchase Plan with shareholder approval to increase the aggregate number of shares of stock reserved for issuance or transfer under the Plan by an additional 300,000 shares so that the total number of shares of stock reserved for issuance or transfer under the Plan shall be 1,100,000 shares and to extend the expiration date of the Plan to December 31, 2025. In fiscal 2018, the Company amended the Purchase Plan with shareholder approval to increase the aggregate number of shares of stock reserved for issuance or transfer under the Plan by an additional 300,000 shares so that the total number of shares of stock reserved for issuance or transfer under the Plan shall be 1,400,000 shares. The Company has two offering periods in the Purchase Plan coinciding with the Company’s first two fiscal quarters and the last two fiscal quarters. Actual shares are issued on the first business day of the subsequent offering period for the prior offering period payroll deductions. The number of shares issued at the beginning of the current period (on July 1, 2019) was 59,075. As of September 28, 2019, there were 267,877 shares available for issuance under the Purchase Plan. Time-Based Restricted Stock Units From time-to-time the Company issues time-based restricted stock units. These time-based restricted stock units typically include dividend accrual equivalents, which means that any dividends paid by the Company during the vesting period become due and payable after the vesting period assuming the grantee’s restricted stock unit fully vests. Dividends for these grants are accrued on the dividend payment dates and included in accounts payable and accrued expenses on the accompanying consolidated balance sheet. As of September 28, 2019, there was $40 in accrued dividends. Dividends for time-based restricted stock units that ultimately do not vest are forfeited. To date, the Company has issued time-based restricted stock units only under its 2007 Omnibus Equity Compensation Plan and the 2014 Plan. The 2007 Plan has expired and there are no time-based restricted stock units outstanding thereunder. The following summarizes the activity in the time-based restricted stock units under the 2014 Plan during the thirty-nine week period ended September 28, 2019:
|  | Number of Time-Based Restricted Stock Units |  |  | Weighted Average Grant Date Fair Value per Share |
Outstanding non-vested at December 29, 2018 |  |  | 147,372 |  |  | $ | 4.46 |
Granted |  |  | 20,000 |  |  | $ | 3.73 |
Vested |  |  | (35,000 | ) |  | $ | 4.41 |
Forfeited or expired |  |  | (12,000 | ) |  | $ | 5.84 |
Outstanding non-vested at September 28, 2019 |  |  | 120,372 |  |  | $ | 4.22 |
Based on the closing price of the Company’s common stock of $3.04 per share on September 27, 2019 ( the last trading day prior to September 28, 2019), the intrinsic value of the time-based non-vested restricted stock units at September 28, 2019 was approximately $366. As of September 28, 2019, there was approximately $138 of total unrecognized compensation cost related to time-based restricted stock units, which is expected to be recognized over the vesting period of the restricted stock units. Performance Based Restricted Stock Units From time-to-time the Company issues performance-based restricted stock units to its executives. Performance-based restricted stock units are typically vested based on certain multi-year performance metrics as determined by the Board of Directors Compensation Committee. These performance-based restricted stock units typically include dividend accrual equivalents, which means that any dividends paid by the Company during the vesting period become due and payable after the vesting period on any stock units that actually vest, if any. Dividends for these grants are accrued on the dividend payment dates and included in accounts payable and accrued expenses on the accompanying consolidated balance sheet. As of September 28, 2019, there were no accrued dividends. Dividends for performance-based restricted stock units that ultimately do not vest are forfeited. To date, the Company has issued performance-based restricted stock units only under the 2014 Plan. The following summarizes the activity in the performance-based restricted stock units during the thirty-nine week period ended September 28, 2019:
|  | Number of Performance- Based Restricted Stock Units |  |  | Weighted Average Grant Date Fair Value per Share |
Outstanding non-vested at December 29, 2018 |  |  | 200,000 |  |  | $ | 5.06 |
Granted |  |  | 167,148 |  |  | $ | 4.35 |
Vested |  |  | (47,148 | ) |  | $ | 3.69 |
Forfeited or expired |  |  | - |  |  | $ | - |
Outstanding non-vested at September 28, 2019 |  |  | 320,000 |  |  | $ | 4.82 |
As of September 28, 2019, the Company currently considers the metrics of the total outstanding 320,000 performance-based restricted stock units as unlikely to be achieved. The Company will reassess at each reporting date whether achievement of any performance condition is probable and would begin recognizing additional compensation cost if and when achievement of the performance condition becomes probable. The Company will then recognize the appropriate expense cumulatively in the year performance becomes probable and recognize the remaining compensation cost over the remaining requisite service period. If at a later measurement date the Company determines that performance-based restricted stock units deemed as likely to vest are deemed as unlikely to vest, the expense recognized will be reversed. As of September 28, 2019, there was approximately $1.5 million of total unrecognized compensation cost related to performance-based restricted stock units deemed likely to vest.

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