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Note 4 - Stock-based Compensation | 9 Months Ended
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Dec. 28, 2014
Notes to Financial Statements |
Disclosure of Compensation Related Costs, Share-based Payments [Text Block] | N ote 4 – Stock-based Compensation The Company has two incentive stock plans, the 2006 Omnibus Incentive Plan (the “2006 Plan”) and the 2014 Omnibus Equity Compensation Plan (the “2014 Plan”). As a result of the approval of the 2014 Plan by the Company’s stockholders at the Company’s 2014 annual meeting, grants may no longer be issued under the 2006 Plan. The Company believes that awards of long-term, equity-based incentive compensation will attract and retain directors, officers and employees of the Company and will encourage these individuals to contribute to the successful performance of the Company, which will lead to the achievement of the Company’s overall goal of increasing stockholder value. Awards granted under the 2014 Plan may be in the form of incentive stock options, non-qualified stock options, shares of stock (including restricted shares), stock units, stock appreciation rights or other stock-based awards. Awards may be granted subject to the achievement of performance goals or other conditions, and certain awards may be payable in stock or cash, or a combination of the two. The 2014 Plan is administered by the Compensation Committee of the Company’s Board of Directors (the “Board”), which selects eligible employees, consultants, advisors and non-employee directors to participate in the 2014 Plan and determines the type, amount, duration and other terms of individual awards. At December 28, 2014, 1.2 million shares of the Company’s common stock were available for future issuance under the 2014 Plan. Stock-based compensation expense is calculated according to FASB ASC Topic 718, Compensation – Stock Compensation , which requires stock-based compensation to be accounted for using a fair-value-based measurement. The Company recorded stock-based compensation expense of $225,000 and $131,000 during the three-month periods ended December 28, 2014 and December 29, 2013, respectively, and recorded $652,000 and $487,000 during the nine-month periods ended December 28, 2014 and December 29, 2013, respectively. The Company records the compensation expense related to stock-based awards granted to individuals in the same expense classifications as the cash compensation paid to those same individuals. No stock-based compensation costs have been capitalized as part of the cost of an asset as of December 28, 2014. Stock Options: The following table represents stock option activity for the nine-month periods ended December 28, 2014 and December 29, 2013 :
|  | Nine-Month Period Ended December 28, 2014 |  |  | Nine-Month Period Ended December 29, 2013 |
|  | Weighted-Average |  |  | Number of Options |  |  | Weighted-Average |  |  | Number of Options |
|  | Exercise Price |  |  | Outstanding |  |  | Exercise Price |  |  | Outstanding |
Outstanding at Beginning of Period |  | $ | 5.76 |  |  |  | 185,000 |  |  | $ | 5.23 |  |  |  | 145,000 |
Granted |  |  | 7.90 |  |  |  | 165,000 |  |  |  | 6.14 |  |  |  | 100,000 |
Exercised |  |  | 5.78 |  |  |  | (10,000 | ) |  |  | 5.12 |  |  |  | (40,000 | )
Outstanding at End of Period |  |  | 6.80 |  |  |  | 340,000 |  |  |  | 5.70 |  |  |  | 205,000 |
Exercisable at End of Period |  |  | 5.60 |  |  |  | 125,000 |  |  |  | 5.14 |  |  |  | 55,000 |
As of December 28, 2014, the intrinsic value of the outstanding and exercisable stock options was $340,000 and $262,000, respectively. The total intrinsic value of the stock options exercised during each of the three and nine-month periods ended December 28, 2014 was $14,000. The total intrinsic value of the stock options exercised during the three and nine-month periods ended December 29, 2013 was $23,000 and $60,000, respectively. The Company received no cash from the exercise of stock options during the nine-month periods ended December 28, 2014 and December 29, 2013. Upon the exercise of stock options, participants may choose to surrender to the Company those shares from the option exercise necessary to satisfy the exercise amount and their income tax withholding obligations that arise from the option exercise. The effect on the cash flow of the Company from these “cashless” option exercises is that the Company remits cash on behalf of the participant to satisfy his or her income tax withholding obligations. The Company used cash of $5,000 to remit the required income tax withholding amounts from “cashless” option exercises during each of the three and nine-month periods ended December 28, 2014 and used cash of $8,000 and $24,000 to remit the required income tax withholding amounts from “cashless” option exercises during the three and nine-month periods ended December 29, 2013, respectively. To determine the estimated fair value of stock options granted, the Company uses the Black-Scholes-Merton valuation formula, which is a closed-form model that uses an equation to estimate fair value. The following table sets forth the assumptions used to determine the fair value, and the resulting grant-date fair value per option, of the non-qualified stock options which were awarded to certain employees during the nine-months ended December 28, 2014 and December 29, 2013, which options vest over a two-year period, assuming continued service.
|  | Nine-Month Periods Ended |
|  | December 28, 2014 |  |  | December 29, 2013 |
Options issued |  |  | 165,000 |  |  |  | 100,000 |
Grant date |  | June 18, 2014 |  |  | June 14, 2013 |
Dividend yield |  |  | 4.05 | % |  |  | 5.21 | %
Expected volatility |  |  | 30.00 | % |  |  | 35.00 | %
Risk free interest rate |  |  | 0.95 | % |  |  | 0.49 | %
Contractual term (years) |  |  | 10.00 |  |  |  | 10.00 |
Expected term (years) |  |  | 3.00 |  |  |  | 3.00 |
Forfeiture rate |  |  | 5.00 | % |  |  | 5.00 | %
Exercise price (grant-date closing price) per option |  | $ | 7.90 |  |  | $ | 6.14 |
Fair value per option |  | $ | 1.19 |  |  | $ | 0.98 |
For the three-month periods ended December 28, 2014 and December 29, 2013, the Company recognized compensation expense associated with stock options as follows (in thousands):
|  | Three-Month Period Ended December 28, 2014 |  |  | Three-Month Period Ended December 29, 2013 |
|  | Cost of |  |  | Other Marketing & |  |  |  |  |  |  | Cost of |  |  | Other Marketing & |  |  |  |  |
|  | Products |  |  | Administrative |  |  | Total |  |  | Products |  |  | Administrative |  |  | Total |
Options Granted in Fiscal Year |  | Sold |  |  | Expenses |  |  | Expense |  |  | Sold |  |  | Expenses |  |  | Expense |
2013 |  | $ | - |  |  | $ | - |  |  | $ | - |  |  | $ | 11 |  |  | $ | 11 |  |  | $ | 22 |
2014 |  |  | 6 |  |  |  | 6 |  |  |  | 12 |  |  |  | 6 |  |  |  | 6 |  |  |  | 12 |
2015 |  |  | 12 |  |  |  | 10 |  |  |  | 22 |  |  |  | - |  |  |  | - |  |  |  | - |
Total stock option compensation |  | $ | 18 |  |  | $ | 16 |  |  | $ | 34 |  |  | $ | 17 |  |  | $ | 17 |  |  | $ | 34 |
For the nine-month periods ended December 28, 2014 and December 29, 2013, the Company recognized compensation expense associated with stock options as follows (in thousands):
|  | Nine-Month Period Ended December 28, 2014 |  |  | Nine-Month Period Ended December 29, 2013 |
|  | Cost of |  |  | Other Marketing & |  |  |  |  |  |  | Cost of |  |  | Other Marketing & |  |  |  |  |
|  | Products |  |  | Administrative |  |  | Total |  |  | Products |  |  | Administrative |  |  | Total |
Options Granted in Fiscal Year |  | Sold |  |  | Expenses |  |  | Expense |  |  | Sold |  |  | Expenses |  |  | Expense |
2012 |  | $ | - |  |  | $ | - |  |  | $ | - |  |  | $ | 14 |  |  | $ | 11 |  |  | $ | 25 |
2013 |  |  | 12 |  |  |  | 12 |  |  |  | 24 |  |  |  | 35 |  |  |  | 35 |  |  |  | 70 |
2014 |  |  | 19 |  |  |  | 19 |  |  |  | 38 |  |  |  | 13 |  |  |  | 13 |  |  |  | 26 |
2015 |  |  | 26 |  |  |  | 22 |  |  |  | 48 |  |  |  | - |  |  |  | - |  |  |  | - |
Total stock option compensation |  | $ | 57 |  |  | $ | 53 |  |  | $ | 110 |  |  | $ | 62 |  |  | $ | 59 |  |  | $ | 121 |
As of December 28, 2014, total unrecognized stock option compensation expense amounted to $172,000, which will be recognized as the underlying stock options vest over a weighted-average period of 10.2 months. The amount of future stock option compensation expense could be affected by any future stock option grants and by the separation from the Company of any individual who has received stock options that are unvested as of such individual’s separation date. Non-vested Stock Granted to Non-Employee Directors: The Board granted the following shares of non-vested stock to the Company’s non-employee directors:
Number of Shares | Fair Value per Share | Three-Month Period Ended
28,000 | $7.97 | September 28, 2014
28,000 | $6.67 | September 29, 2013
42,000 | $5.62 | September 30, 2012
30,000 | $4.44 | October 2, 2011
These shares vest over a two-year period, assuming continued service. The fair value of the non-vested stock granted to the Company’s non-employee directors was based on the closing price of the Company’s common stock on the date of the grant. In August 2014, 28,000 shares vested that had been granted to non-employee directors, with such shares having an aggregate value of $223,000. Non-vested Stock Granted to Employees: During the three-month period ended June 27, 2010, the Board awarded 345,000 shares of non-vested stock to certain employees in a series of grants, each of which will vest only if (i) the closing price of the Company’s common stock is at or above certain target levels for any ten trading days out of any period of 30 consecutive trading days and (ii) the respective employees remain employed through July 29, 2015. The Company, with the assistance of an independent third party, determined that the aggregate grant date fair value of the awards amounted to $1.2 million. During the three-month period ended December 28, 2014, the Board approved an amendment to the grant subject to the $6.00 per share closing price condition that had been awarded to E. Randall Chestnut, Chairman, Chief Executive Officer and President of the Company, and an amendment to the grant subject to the $5.00 per share closing price condition that had been awarded to Nanci Freeman, Chief Executive Officer and President of CCIP. With the closing price conditions having been met for these awards, the original grant of 75,000 shares awarded to Mr. Chestnut was amended to provide for the immediate vesting of 10,000 shares and the original grant of 20,000 shares awarded to Ms. Freeman was amended to provide for the immediate vesting of the shares, with both amendments made effective as of November 24, 2014. The vesting of these awards was accelerated in order to preserve the deductibility of the associated compensation expense by the Company for income tax purposes. As a result of the acceleration of the vesting, the Company recognized the remaining compensation expense associated with the shares vested of $12,000 during the three-month period ended December 28, 2014. These amounts would otherwise have been recognized by the Company ratably through July 29, 2015. To satisfy the income tax withholding obligations that arose from the vesting of the shares, Mr. Chestnut and Ms. Freeman surrendered to the Company 4,795 and 10,516 shares, respectively, and the Company paid $111,000 to the appropriate taxing authorities on their behalf. Performance Bonus Plan: The Company maintains a performance bonus plan for certain executive officers that provides for awards of shares of common stock in the event that the aggregate average market value of the common stock during the relevant fiscal year, plus the amount of cash dividends paid in respect of the common stock during such period, increases. These individuals may instead be awarded cash, if and to the extent that insufficient shares of common stock are available for issuance from all shareholder-approved, equity-based plans or programs of the Company in effect. The performance bonus plan also imposes individual limits on awards and provides that shares of common stock that may be awarded will vest over a two-year period. Compensation expense associated with performance bonus plan awards are recognized over a three-year period – the fiscal year in which the award is earned, plus the two-year vesting period. In respect of awards earned pursuant to the performance bonus plan for fiscal year 2014, the Company awarded 188,232 shares of common stock during the three months ended June 29, 2014. In connection with these awards, the Company recognized compensation expense of $354,000 during fiscal year 2014 and will recognize, on a straight-line basis, $354,000 in compensation expense during each of fiscal years 2015 and 2016. For the three-month periods ended December 28, 2014 and December 29, 2013, the Company recognized compensation expense associated with stock grants, which is included in marketing and administrative expenses in the accompanying consolidated statements of income, as follows (in thousands):
|  | Three-Month Period Ended December 28, 2014 |  |  | Three-Month Period Ended December 29, 2013 |
|  |  |  |  |  | Non-employee |  |  | Total |  |  |  |  |  |  | Non-employee |  |  | Total |
Stock Granted in Fiscal Year |  | Employees |  |  | Directors |  |  | Expense |  |  | Employees |  |  | Directors |  |  | Expense |
2011 |  | $ | 51 |  |  | $ | - |  |  | $ | 51 |  |  | $ | 55 |  |  | $ | - |  |  | $ | 55 |
2012 |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |
2013 |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 19 |  |  |  | 19 |
2014 |  |  | - |  |  |  | 23 |  |  |  | 23 |  |  |  | - |  |  |  | 23 |  |  |  | 23 |
2015 |  |  | 89 |  |  |  | 28 |  |  |  | 117 |  |  |  | - |  |  |  | - |  |  |  | - |
Total stock grant compensation |  | $ | 140 |  |  | $ | 51 |  |  | $ | 191 |  |  | $ | 55 |  |  | $ | 42 |  |  | $ | 97 |
For the nine-month periods ended December 28, 2014 and December 29, 2013, the Company recognized compensation expense associated with stock grants, which is included in marketing and administrative expenses in the accompanying consolidated statements of income, as follows (in thousands):
|  | Nine-Month Period Ended December 28, 2014 |  |  | Nine-Month Period Ended December 29, 2013 |
|  |  |  |  |  | Non-employee |  |  | Total |  |  |  |  |  |  | Non-employee |  |  | Total |
Stock Granted in Fiscal Year |  | Employees |  |  | Directors |  |  | Expense |  |  | Employees |  |  | Directors |  |  | Expense |
2011 |  | $ | 133 |  |  | $ | - |  |  | $ | 133 |  |  | $ | 141 |  |  | $ | - |  |  | $ | 141 |
2012 |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 22 |  |  |  | 22 |
2013 |  |  | - |  |  |  | 27 |  |  |  | 27 |  |  |  | - |  |  |  | 71 |  |  |  | 71 |
2014 |  |  | - |  |  |  | 69 |  |  |  | 69 |  |  |  | 93 |  |  |  | 39 |  |  |  | 132 |
2015 |  |  | 267 |  |  |  | 46 |  |  |  | 313 |  |  |  | - |  |  |  | - |  |  |  | - |
Total stock grant compensation |  | $ | 400 |  |  | $ | 142 |  |  | $ | 542 |  |  | $ | 234 |  |  | $ | 132 |  |  | $ | 366 |
As of December 28, 2014, total unrecognized compensation expense related to the Company’s non-vested stock grants amounted to $759,000, which will be recognized over the respective vesting terms associated with each block of non-vested stock indicated above, such grants having an aggregate weighted-average vesting term of 8.2 months. The amount of future compensation expense related to the Company’s non-vested stock grants could be affected by any future non-vested stock grants and by the separation from the Company of any individual who has non-vested stock grants as of such individual’s separation date.

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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://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 718 -SubTopic 10 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6415400&loc=d3e5047-113901 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 718 -SubTopic 10 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=6415400&loc=d3e5070-113901 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 50 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6406099&loc=d3e25284-112666 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 718 -SubTopic 40 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6418621&loc=d3e17540-113929 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 718 -SubTopic 10 -Section 50 -Paragraph 4 -URI http://asc.fasb.org/extlink&oid=6415400&loc=d3e5444-113901 Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Staff Accounting Bulletin (SAB) -Number Topic 14 + Details
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