Stock-Based Compensation

12 Months Ended

Mar. 30, 2013

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Stock-Based Compensation

Stock-Based Compensation

The Company maintains stock incentive plans whereby stock option grants or awards of restricted stock may be made to certain officers, directors and key employees. The plans, which are shareholder approved, permit the award of up to 1,350,000 shares of the Company’s common stock, of which 271,076 shares were still available for grant at March 30, 2013. When options are exercised, new shares of the Company’s common stock are issued. Stock options may not be granted below 100% of the fair market value of the Company’s common stock at the date of grant and generally expire seven years from the date of grant. Stock options and awards of restricted stock typically vest over a one to five year period as determined by the plan administrator (the Board’s Compensation Committee, which consists of independent directors). The stock incentive plans provide for accelerated vesting of stock options and removal of restrictions on restricted stock awards upon a change in control (as defined in the plans).

The Company applies the fair value recognition provisions of FASB ASC 718, Compensation—Stock Compensation (“ASC 718”). Stock option compensation expense decreased income before income taxes by approximately $1.3 million, $905,000 and $655,000 for fiscal years 2013, 2012 and 2011, respectively. Total compensation cost, including costs related to the vesting of restricted stock awards, charged against income for fiscal years 2013, 2012 and 2011 was approximately $1.3 million, $916,000 and $671,000, respectively. As of March 30, 2013, total unrecognized compensation cost related to stock options was approximately $2.0 million and the related weighted-average period over which it is expected to be recognized is approximately 1.2 years.

The following table summarizes the option activity within the Company’s stock-based compensation plans for the fiscal year ended March 30, 2013:

	Number of Shares		Weighted Average Exercise Price		Weighted Average Remaining Contractual Term	Aggregate Intrinsic Value (in thousands)
Outstanding at March 31, 2010	681,580		$	18.88
Granted	65,500		35.80
Exercised	(345,580	)	11.55
Outstanding at March 31, 2011	401,500		$	27.95	3.59	$	6,910
Granted	80,100		44.45
Exercised	(72,850	)	20.08
Canceled or expired	(1,250	)	24.18
Outstanding at March 31, 2012	407,500		$	32.62	3.91	$	5,689
Granted	72,200		46.59
Exercised	(77,000	)	28.55
Canceled or expired	(3,000	)	45.00
Outstanding at March 30, 2013	399,700		$	35.83	4.18	$	4,691
Exercisable at March 31, 2011	192,750		$	26.81	1.59	$	3,537
Exercisable at March 31, 2012	168,775		$	31.57	2.37	$	2,533
Exercisable at March 30, 2013	179,925		$	34.15	3.58	$	2,414

The weighted-average estimated fair value of employee stock options granted during fiscal years 2013, 2012 and 2011 were $19.89, $17.96 and $13.99, respectively. The total intrinsic value of options exercised during fiscal years 2013, 2012 and 2011 was $1.2 million, $1.3 million and $8.3 million, respectively.

The Company uses the Black-Scholes-Merton option-pricing model to determine the fair value of stock options. The determination of the fair value of stock options on the date of grant using an option-pricing model is affected by the Company’s stock price as well as assumptions regarding a number of complex and subjective variables. These variables include actual and projected employee stock option exercise behaviors, the Company’s expected stock price volatility over the expected term of the awards, risk-free interest rate, and expected dividends. The fair values of options granted were estimated at the date of grant using the following weighted average assumptions:

	Fiscal Year
	2013		2012		2011
Volatility	51.5	%	46.4	%	44.1	%
Risk-free interest rate	0.6	%	1.6	%	1.8	%
Dividend yield	—	%	—	%	—	%
Expected option life in years	4.62		4.60		4.74

The Company estimates the expected term of options granted by using the simplified method as prescribed by SEC Staff Accounting Bulletin (“SAB”) No. 107 and SAB 110. The Company uses the simplified method as the Company does not have sufficient historical share option exercise data due to the limited period of time the Company’s equity shares have been publicly traded. The Company estimates the expected volatility of its common stock taking into consideration its historical stock price movement and its expected future stock price trends based on known or anticipated events. The Company bases the risk-free interest rate that it uses in the option pricing model on U.S. Treasury zero-coupon issues with remaining terms similar to the expected term on the options. The Company does not anticipate paying any cash dividends in the foreseeable future and therefore uses an expected dividend yield of zero in the option-pricing model. The Company is required to estimate future forfeitures at the time of grant and revise those estimates in subsequent periods if actual forfeitures differ from those estimates. The Company uses historical data to estimate pre-vesting option forfeitures and records stock-based compensation cost only for those awards that are expected to vest. The Company recognizes stock-based compensation expense using the straight-line attribution method.

Restricted stock awards are valued at the closing market value of the Company’s common stock on the date of grant, and the total value of the award is expensed ratably over the service period of the employees receiving the grants. A summary of restricted stock activity within the Company’s stock-based compensation plans and changes for the fiscal year ended March 30, 2013 is as follows:

	Shares		Grant-Date Fair Value
Nonvested at March 31, 2010	840		$	35.67
Vested	(342	)	35.09
Nonvested at March 31, 2011	498		36.07
Vested	(340	)	35.11
Nonvested at March 31, 2012	158		38.16
Vested	(158	)	38.16
Nonvested at March 30, 2013	—		$	—