Stock-Based Compensation

3 Months Ended

Apr. 04, 2014

Stockholders' Equity Note [Abstract]

Stockholders' Equity Note Disclosure [Text Block]

Note 10 — Stock-Based Compensation

Stock-based compensation is set forth below (in thousands):

	Three Months Ended
	April 4, 2014		March 29, 2013
Employee stock expense	$	797	$	821
Restricted stock expense		293		188
Restricted unit expense		388		—
Consultant compensation		22		25
Total	$	1,500	$	1,034

Stock Option Plans

The Amended and Restated 2003 Omnibus Equity Incentive Plan (“the Plan”) provides for various forms of stock-based incentives. To date, of the available forms of awards under the Plan, the Company has granted only stock options, restricted stock, unrestricted share grants, and performance contingent stock units. Options under the plan are granted at fair market value on the date of grant, become exercisable over a three year period, or as determined by the Board of Directors, and expire over periods not exceeding 10 years from the date of grant. Certain option and share awards provide for accelerated vesting if there is a change in control (as defined in the Plan). Pursuant to the Plan, options for 3,346,875 shares were outstanding at April 4, 2014 with exercise prices ranging between $0.95 and $16.59 per share. Restricted stock grants under the Plan generally vest over a period between one to four years. There were 252,685 shares of restricted stock and 290,500 restricted stock units (RSUs) outstanding at April 4, 2014. As of April 4, 2014, there were 694,296 shares authorized and available for grants under the Plan.

Assumptions

The fair value of each option award is estimated on the date of grant using a Black-Scholes option valuation model applying the assumptions noted in the following table. Expected volatilities are based on historical volatility of the Company’s stock. The Company uses historical data to estimate option exercise and employee termination behavior. The expected term of options granted is derived from the historical exercise activity over the past 15 years, and represents the period of time that options granted are expected to be outstanding. The Company has calculated a 6.92% estimated forfeiture rate based on historical forfeiture experience. The risk-free rate is based on the U.S. Treasury yield curve corresponding to the expected term at the time of the grant.

	Three Months Ended
	April 4, 2014			March 29, 2013
Expected dividend yield		0	%		0	%
Expected volatility		55.25	%		73.44	%
Risk-free interest rate		1.28	%		0.61	%
Expected term (in years)		4.12			4.12

A summary of option activity under the Plan for the period ended April 4, 2014 is presented below:

	Options Shares (000’s)
Outstanding at January 3, 2014		3,299
Granted		383
Exercised		(328)
Forfeited or expired		(7)
Outstanding at April 4, 2014		3,347
Exercisable at April 4, 2014		2,274

Warrants outstanding and exercisable for the period ended April 4, 2014 and January 3, 2014 were 700,000, respectively.

A summary of restricted stock and restricted stock units activity under the Plan for the period ended April 4, 2014 is presented below:

	Restricted Shares (000’s)		Restricted Units (000’s)
Outstanding at January 3, 2014		341		135
Granted		2		291
Vested		(90)		(135)
Forfeited		—		—
Outstanding at April 4, 2014		253		291