Note 4 - Stock-Based Compensation

3 Months Ended

Dec. 28, 2013

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

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

(4) Stock-Based Compensation

Under the Company’s equity incentive plans, employees and directors may be granted stock options, restricted stock, restricted stock units and performance awards. As of December 28, 2013, there were 587,000 shares available for future grants under the plans.

Stock options. Under the Company’s equity incentive plans, employees and directors may be granted options to purchase shares of the Company’s common stock at the fair market value on the date of the grant. Options granted under these plans generally vest over three years and expire ten years from the date of the grant. Compensation expense and excess tax benefits associated with stock options for the three-month periods ended December 28, 2013 and December 29, 2012 are as follows:

	Three Months Ended
	December 28, 2013			December 29, 2012
(In thousands)
Stock options:
Compensation expense	$	165		$	139
Excess tax benefits		(86	)		(36	)

As of December 28, 2013, the remaining unamortized compensation cost related to unvested stock option awards was $458,000, which is expected to be recognized over a weighted average period of 1.15 years.

The fair value of each option grant is estimated on the date of grant using a Monte Carlo valuation model based upon assumptions that are evaluated and revised, as necessary, to reflect market conditions and actual historical experience. The risk-free interest rate for periods within the contractual life of the option is based on the U.S. Treasury yield curve in effect at the time of the grant. The dividend yield is calculated based on the Company’s annual dividend as of the option grant date. The expected volatility is derived using a term structure based on historical volatility and the volatility implied by exchange-traded options on the Company’s common stock. The expected term for options is based on the results of a Monte Carlo simulation model, using the model’s estimated fair value as an input to the Black-Scholes-Merton model, and then solving for the expected term.

The following table summarizes stock option activity for the three-month period ended December 28, 2013:

	Options			Exercise Price Per Share					Contractual Term -	Aggregate Intrinsic
	Outstanding						Weighted		Weighted	Value
	(in thousands)			Range			Average		Average (years)	(in thousands)
Outstanding at September 28, 2013		918		$5.43	-	$20.27	$	12.65
Exercised		(72	)	9.16	-	13.06		11.03		$	592
Outstanding at December 28, 2013		846		5.43	-	20.27		12.78	5.87		8,332
Vested and anticipated to vest in the future at December 28, 2013		841						12.78	5.85		8,288
Exercisable at December 28, 2013		554						12.24	4.39		5,754

Stock option exercises included “net exercises,” pursuant to which the optionee received shares of common stock equal to the intrinsic value of the options (fair market value of common stock on the date of exercise less exercise price) reduced by any applicable withholding taxes.

Restricted stock units. Restricted stock units (“RSUs”) granted under the Company’s equity incentive plans are valued based upon the fair market value on the date of the grant and provide for a dividend equivalent payment which is included in compensation expense. The vesting period for RSUs is generally one to three years from the date of the grant. RSUs do not have voting rights. RSU compensation expense for the three-month periods ended December 28, 2013 and December 29, 2012 is as follows:

	Three Months Ended
	December 28, 2013		December 29, 2012
(In thousands)
Compensation expense	$	243	$	174

As of December 28, 2013, the remaining unrecognized compensation cost related to unvested RSUs was $741,000, which is expected to be recognized over a weighted average vesting period of 1.46 years.

The following table summarizes RSU activity during the three-month period ended December 28, 2013:

	Restricted Stock Units Outstanding		Weighted Average Grant Date Fair Value
(Unit amounts in thousands)
Balance, September 28, 2013		221	$	13.20
Granted		-		-
Released		-		-
Balance, December 28, 2013		221	$	13.20