XML 27 R9.htm IDEA: XBRL DOCUMENT v2.4.0.6
Stock-Based Compensation
 3 Months Ended
Jul. 29, 2012
Stock-Based Compensation
3.  Stock-Based Compensation

Incentive Stock Option Awards

We did not grant any incentive stock option awards during the first quarter of fiscal 2013.

At July 29, 2012, options to purchase 209,475 shares of common stock were outstanding, had a weighted average exercise price of $7.22 per share, and a weighted average contractual term of 4.9 years. At July 29, 2012, the aggregate intrinsic value for options outstanding was $614,000.
 
At July 29, 2012, outstanding options to purchase 188,475 shares of common stock were exercisable, had a weighted average exercise price of $7.68 per share, and a weighted average contractual term of 4.7 years. At July 29, 2012, the aggregate intrinsic value for options exercisable was $466,000.

The aggregate intrinsic value for options exercised during the first quarter of fiscal 2012 was $157,000. No options were exercised during the first quarter of fiscal 2013.

The remaining unrecognized compensation cost related to incentive stock option awards at July 29, 2012, was $37,000 which is expected to be recognized over a weighted average period of 1.1 years.

We recorded $25,000 and $34,000 of compensation expense on incentive stock option grants within selling, general, and administrative expense for the three-month periods ended July 29, 2012, and July 31, 2011, respectively.
 
Time Vested Restricted Stock Awards

We did not grant any time vested restricted stock awards during the first quarter of fiscal 2013.
 
We recorded $28,000 and $43,000 of compensation expense within selling, general, and administrative expense for time vested restricted stock awards for the three-month periods ending July 29, 2012 and July 31, 2011 respectively.
 
At July 29, 2012, there were 123,335 shares of time vested restricted stock outstanding and unvested. Of the 123,335 shares outstanding and unvested, 70,000 shares (granted on January 7, 2009) vest in equal installments on May 1, 2013 and 2014, respectively. The remaining 53,335 shares (granted on July 1, 2009) vest in equal installments on July 1, 2013, and 2014, respectively. At July 29, 2012, the weighted average fair value of these outstanding and unvested shares was $3.71 per share.
 
During the first quarter of fiscal 2013, 61,665 shares of time vested restricted stock vested and had a weighted average fair value of $232,000 or $3.76 per share.
 
At July 29, 2012, the remaining unrecognized compensation cost related to the unvested restricted stock awards was $130,000, which is expected to be recognized over a weighted average vesting period of 1.5 years.
 
Performance Based Restricted Stock Units

On July 11, 2012, certain key members of management were granted performance based restricted common stock units which could earn up to 120,000 shares of common stock if certain performance targets are met as defined in the related restricted stock unit agreement. These awards were valued based on the fair market value on the date of grant. The fair value of these awards were $10.21, which represents the closing price of our common stock on the date of grant. The vesting of these awards are over the requisite service period of three years.

The company recorded compensation expense of $17,000 within selling, general, and administrative expense for performance based restricted stock units for the three-month period ending July 29, 2012. No compensation expense was recorded for performance based restricted stock units for the three-month period ending July 31, 2011, as the performance based restricted stock units granted in fiscal 2009 were fully vested in fiscal 2011 and no performance based restricted stock units were granted in fiscal years 2010 through 2012. Compensation cost is recorded based on an assessment each reporting period of the probability if certain performance goals will be met during the vesting period. If performance goals are not probable of occurrence, no compensation cost will be recognized and any recognized compensation cost would be reversed.
 
As of July 29, 2012, the remaining unrecognized compensation cost related to the performance based restricted stock units was $596,000, which is expected to be recognized over a weighted average vesting period of 3.0 years.

Common Stock Awards
 
We did not grant any common stock awards during the first quarter of fiscal 2013.

 
Other Share-Based Arrangements

Effective May 2, 2011, we entered into an agreement in which we granted a non-employee a stock appreciation right that is indexed on 70,000 shares of our common stock. This agreement requires us to settle in cash an amount equal to $35,000, plus the excess, if any, over a stock appreciation right value of $700,000 at May 2, 2011. This stock appreciation right value of $700,000 represents the 70,000 indexed shares of common stock noted above measured at the closing price per share of $10 at May 2, 2011. The cash settlement in connection with the stock appreciation right value would represent the difference between a stock appreciation right value that is indexed on the 70,000 shares of common stock noted above and based on the highest closing price per share of our common stock for the period May 2, 2011 through June 30, 2012 (limited to $12 per share) and the $700,000 stock appreciation right value at May 2, 2011. This award will vest over the period May 2, 2011 through June 30, 2012 as this represents the non-employee’s required service period.
 
During the first quarter of fiscal 2013, this award fully vested and was paid out at a fair value totaling $174,000.

Compensation expense associated with this agreement was $40,000 and $8,000 for the three-months ended July 29, 2012 and July 31, 2011, respectively.