On January 27, 2012, the Company approved the 2011 Equity Incentive Plan (the “2011 Plan”). The 2011 Plan authorized the Company to issue options to employees, consultants and directors exercisable for up to a total of 3,750,000 shares of common stock. As of September 26, 2020, all awards granted by the Company under the 2011 Plan have been nonqualified stock options. Options granted under the 2011 Plan have a life of 10 years and vest over service periods of five years or in connection with certain events as defined by the 2011 Plan.

On October 19, 2014, the Company approved the 2014 Equity Incentive Plan, which was amended as of August 24, 2016 (as amended, the “2014 Plan”). Following the approval of the 2014 Plan, no further grants have been made under the 2011 Plan. The 2014 Plan authorizes the Company to issue awards to employees, consultants and directors for up to a total of 3,600,000 shares of common stock. As of September 26, 2020, all awards granted by the Company under the 2014 Plan to date have been nonqualified stock options, restricted stock awards, restricted stock units or performance share units. Options granted under the 2014 Plan have a life of eight to ten years and vest over service periods of four or five years or in connection with certain events as defined by the 2014 Plan. Restricted stock awards granted under the 2014 Plan vest over one or four years, as determined by the Compensation Committee of our board of directors. Restricted stock units vest over service periods of one, four or five years, as determined by the Compensation Committee of our board of directors. Performance share units are subject to the vesting criteria discussed further below.

On August 26, 2020, the Company approved the 2020 Equity Incentive Plan (the “2020 Plan”). Following the approval of the 2020 Plan, no further grants have been made under the 2014 Plan. The 2020 Plan authorizes the Company to issue awards to employees and directors for up to a total of 2,000,000 shares of common stock. As of September 26, 2020, no awards had been granted under the 2020 Plan.

During the thirteen weeks ended September 26, 2020, the Company granted certain members of management options to purchase a total of 22,838 shares under the 2014 Plan. The total grant date fair value of stock options granted during the thirteen weeks ended September 26, 2020 was $0.3 million, with a grant date fair value of $12.71 per share. The Company is recognizing the expense relating to these stock options on a straight-line basis over the four-year service period of the awards. The exercise price of these awards is $23.57 per share.

During the thirteen weeks ended September 28, 2019, the Company did not grant options to purchase shares under the 2014 Plan.

During the twenty-six weeks ended September 26, 2020, the Company granted certain members of management options to purchase a total of 287,373 shares under the 2014 Plan. The total grant date fair value of stock options granted during the twenty-six weeks ended September 26, 2020 was $3.1 million, with grant date fair values of $10.40 to $12.71 per share. The Company is recognizing the expense relating to these stock options on a straight-line basis over the four-year service period of the awards. The exercise price of these awards ranges from $20.94 to $24.08 per share.

During the twenty-six weeks ended September 28, 2019, the Company granted certain members of management options to purchase a total of 116,952 shares under the 2014 Plan. The total grant date fair value of stock options granted during the twenty-six weeks ended September 28, 2019 was $1.3 million, with a grant date fair value of $11.19 per share. The Company is recognizing the expense relating to these stock options on a straight-line basis over the four-year service period of the awards. The exercise price of these awards is $28.63 per share.

During the twenty-six weeks ended September 28, 2019, the Company also granted its Chief Executive Officer ("CEO") an option to purchase 227,273 shares of common stock under the 2014 Plan. This option contains both service and market vesting conditions. Vesting of this option is contingent upon the market price of the Company's common stock achieving three stated price targets for 30 consecutive trading days on or prior to the fourth anniversary of the date of grant and the CEO’s continued service (subject to certain exceptions). If the first market price target is met, 33% of the option granted will cliff vest on the fourth anniversary of the date of grant, with an additional 33% of the option vesting if the second market price target is met, and the last 34% of the option vesting if the final market price target is met. During fiscal 2020, the first market price target was met, and as such, 33% of the option or 75,000 shares will cliff vest on the fourth anniversary of the date of grant, subject to the applicable service conditions. The total grant date fair value of this option was $2.0 million, with a grant date fair value of $8.80 per share. The Company is recognizing the expense relating to this stock option on a straight-line basis over the four-year service period. The exercise price of this award is $28.63 per share. The fair value of the option was estimated using a Monte Carlo simulation model. The following significant assumptions were used as of May 20, 2019, the date of grant:

The stock option awards discussed above were measured at fair value on the grant date using the Black-Scholes option valuation model. Key input assumptions used to estimate the fair value of stock options include the exercise price of the award, the expected option term, expected volatility of the Company’s stock price over the option’s expected term, the risk-free interest rate over the option’s expected term and the Company’s expected annual dividend yield, if any. The Company will issue shares of common stock when the options are exercised.

The fair values of stock options granted during the thirteen and twenty-six weeks ended September 26, 2020 and September 28, 2019 were estimated on the grant dates using the following assumptions:

(1)	The Company has limited historical information regarding expected option term. Accordingly, the Company determined the expected life of the options using the simplified method.

(2)	Stock volatility for each grant is measured using the weighted average of historical daily price changes of the Company’s stock and its competitors’ common stock over the most recent period equal to the expected option term of the Company’s awards.

(3)	The risk-free interest rate is determined using the rate on treasury securities with the same term.

Intrinsic value for stock options is defined as the difference between the market price of the Company’s common stock on the last business day of the fiscal quarter and the weighted average exercise price of in-the-money stock options outstanding at the end of each fiscal period.

The following table summarizes the stock award activity for the twenty-six weeks ended September 26, 2020:


		Grant Date		Weighted
		Weighted		Average	Aggregate
	Stock	Average		Remaining	Intrinsic
	Options	Exercise Price		Contractual Life	Value
				(in years)	(in thousands)
Outstanding at March 28, 2020	1,221,223	$	19.96
Granted	287,373	$	22.50
Exercised	(9,434)	$	6.44		$	167
Cancelled, forfeited or expired	(8,727)	$	17.91
Outstanding at September 26, 2020	1,490,435	$	20.55	6.4	$	11,041
Vested and expected to vest after September 26, 2020	1,490,435	$	20.55	6.4	$	11,041
Exercisable at September 26, 2020	516,252	$	18.61	4.1	$	4,802

A summary of the status of non-vested stock options as of September 26, 2020 including changes during the twenty-six weeks ended September 26, 2020 is presented below:


		Weighted-
		Average
		Grant Date
	Shares	Fair Value
Nonvested at March 28, 2020	931,257	$	6.90
Granted	287,373	$	10.92
Vested	(236,953)	$	5.82
Nonvested shares forfeited	(7,494)	$	7.39
Nonvested at September 26, 2020	974,183	$	8.36

Restricted Stock Units

During the thirteen weeks ended September 26, 2020, the Company granted 8,066 restricted stock units to various employees under the 2014 Plan. The shares granted vest in four equal annual installments beginning on the grant date, provided that the respective award recipient continues to be employed by the Company through each of those dates (subject to certain exceptions). The grant date fair value of these awards for the thirteen weeks ended September 26, 2020 totaled $0.2 million. The Company is recognizing the expense relating to these awards on a straight-line basis over the service period of each award, commencing on the date of grant.

During the twenty-six weeks ended September 26, 2020, the Company granted 175,527 restricted stock units to various directors and employees under the 2014 Plan. The shares granted to employees vest in four equal annual installments beginning on the grant date, provided that the respective award recipient continues to be employed by the Company through each of those dates (subject to certain exceptions). The shares granted to the Company’s directors vest on the first anniversary of the date of grant. The grant date fair value of these awards for the twenty-six weeks ended September 26, 2020 totaled $3.7 million. The Company is recognizing the expense relating to these awards on a straight-line basis over the service period of each award, commencing on the date of grant.

During the thirteen weeks ended September 28, 2019, the Company did not grant any restricted stock units.

During the twenty-six weeks ended September 28, 2019, the Company granted 89,985 restricted stock units to various directors and employees under the 2014 Plan. The shares granted to employees vest in four equal annual installments beginning on the grant date, provided that the respective award recipient continues to be employed by the Company through each of those dates (subject to certain exceptions). The shares granted to the Company’s directors vest on the first anniversary of the date of grant. The grant date fair value of these awards for the twenty-six weeks ended September 28, 2019 totaled $2.6 million. The Company is recognizing the expense relating to these awards on a straight-line basis over the service period of each award, commencing on the date of grant.

Performance Share Units

During the thirteen and twenty-six weeks ended September 26, 2020, the Company did not grant any performance share units.

During the thirteen weeks ended September 28, 2019, the Company did not grant any performance share units. During the twenty-six weeks ended September 28, 2019, the Company granted 38,546 performance share units to various employees under the 2014 Plan with a grant date fair value of $28.63 per share.

The performance share units granted are stock-based awards in which the number of shares ultimately received depends on the Company's performance against its cumulative earnings per share target over a three-year performance period beginning March 31, 2019 and ending March 26, 2022. These performance metrics were established by the Company at the beginning of the performance period. At the end of the performance period, the number of performance shares to be issued is fixed based upon the degree of achievement of the performance goals. If the cumulative three-year performance goals are below the threshold level, the number of performance units to vest will be 0%, if the performance goals are at the threshold level, the number of performance units to vest will be 50% of the target amounts, if the performance goals are at the target level, the number of performance units to vest will be 100% of the target amounts, and if the performance goals are at the maximum level, the number of performance units to vest will be 200% of the target amounts, each subject to continued service through the last day of the performance period (subject to certain exceptions). If performance is between threshold and target goals or between target and maximum goals, the number of performance units to vest will be determined by linear interpolation. The number of shares ultimately issued can range from 0% to 200% of the participant's target award.

The grant date fair value of the performance share units granted during the twenty-six weeks ended September 28, 2019 was initially measured using the Company's closing stock price on the date of grant with the resulting stock compensation expense recognized on a straight-line basis over the three-year vesting period. The expense recognized over the vesting period is adjusted up or down on a quarterly basis based on the anticipated performance level during the

performance period. If the performance metrics are not probable of achievement during the performance period, stock compensation expense would be reversed. The awards are forfeited if the threshold performance goals are not achieved as of the end of the performance period.

Stock-Based Compensation Expense

Stock-based compensation expense was $1.7 million and $1.2 million for the thirteen weeks ended September 26, 2020 and September 28, 2019, respectively. Stock-based compensation expense was $3.5 million and $2.1 million for the twenty-six weeks ended September 26, 2020 and September 28, 2019, respectively. Stock-based compensation expense of $0.2 million was recorded in cost of goods sold in the condensed consolidated statements of operations for both the thirteen weeks ended September 26, 2020 and September 28, 2019. Stock-based compensation expense of $0.8 million and $0.3 million was recorded in cost of goods sold in the condensed consolidated statements of operations for the twenty-six weeks ended September 26, 2020 and September 28, 2019, respectively. All other stock-based compensation expense is included in selling, general and administrative expenses in the condensed consolidated statements of operations.

As of September 26, 2020, there was $5.9 million of total unrecognized stock-based compensation expense related to unvested stock options, with a weighted-average remaining recognition period of 2.65 years. As of September 26, 2020, there was $5.0 million of total unrecognized stock-based compensation expense related to restricted stock units, with a weighted-average remaining recognition period of 2.74 years. As of September 26, 2020, there was $0.4 million of total unrecognized stock-based compensation expense related to performance share units, with a weighted-average remaining recognition period of 1.59 years.