LONG-TERM INCENTIVE PLANS

12 Months Ended

Jun. 03, 2016

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

LONG-TERM INCENTIVE PLANS

NOTE 11 – LONG-TERM INCENTIVE PLANS

The Company has a long-term incentive plan currently in effect under which stock option grants may be issued. This Plan (the 2014 Plan) is administered by the Stock Option Committee of the Board of Directors, which has sole discretion, subject to the terms of the Plan, to determine those employees, including executive officers, eligible to receive awards and the amount and type of such awards. The Stock Option Committee also has the authority to interpret the Plan and make all other determinations required in the administration thereof.

The 2014 Plan provides for, among other things, the granting of Incentive Stock Options as defined under the Internal Revenue Code. Under the Plan, grants of incentive stock options may be made to selected officers and employees, with a term not exceeding ten years from the issue date and at a price not less than the fair market value of the Company’s stock at the date of grant. On April 9, 2015, 310,000 options were granted with an exercise price of $3.84 per share, which was the fair market value of the Company’s stock at the grant date. On April 7, 2016, 30,000 options were granted with an exercise price of $5.40 per share, which was the fair market value of the Company’s stock at the grant date. During the year ended June 3, 2016, 30,000 options were forfeited. The options granted vest over a period of 1 to 2 years from the date of grant with accelerated vesting provisions if there is a change in control. Compensation expense is being recognized for the options over the vesting schedule. Total compensation expense for the year June 3, 2016 was $253,011 as compared to $55,019 for the year ended May 29, 2015. As of June 3, 2016 there was $63,570 in unrecognized compensation expense related to outstanding stock options that will be recognized during the ten-months. The unrecognized compensation expense as of May 29, 2015, was $304,581.

At June 3, 2016, 310,000 options were granted and outstanding. The following is a summary of the transactions for the years ended June 3, 2016 and May 29, 2015:

			2016				2015
			Weighted				Weighted
			Average				Average
			Exercise				Exercise
	Shares		Price		Shares		Price
Outstanding - beginning of year		310,000	$	3.84		-	$	-
Granted		30,000		5.40		310,000		3.84
Exercised		-		-		-		-
Forfeited		(30,000)		3.84		-		-
Cancelled		-		-		-		-
Outstanding - end of year		310,000	$	3.99		310,000	$	3.84

750,000 shares of the Company’s stock were authorized for issuance under this Plan. 440,000 shares remain under this plan for future issuance. At June 3, 2016, 229,167 options were vested and exercisable. In April 2017, the remaining 80,833 options will be vested and exercisable. See Note 17 for additional information affecting long-term incentive plans.