Note 5

At March 26, 2016, the Company has three stock-based employee compensation plans. Share-based compensation expense (benefit) was recognized as follows:

	Three months ended				Six months ended
	March 26, 2016		March 28, 2015		March 26, 2016			March 28, 2015
	(in thousands, except per share amounts)


Stock Options	$	193	$	264	$	(56	)	$	548
Stock purchase plan	$	60	$	50		152			197
Restricted stock issued to an employee	$	1	$	2		2			3
Total share-based compensation	$	254	$	316	$	98		$	748

The above compensation is net of tax benefits	$	283	$	169	$	957		$	261

Income tax benefit related to share-based compensation for the three months ended December 26, 2015 has been revised to $674,000 from $175,000 as a result of our early adoption this quarter of Accounting Standards Update NO. 2016-09, Improvements to Employee Share-Based Payment Accounting. Under this new standard, the $499,000 increase of first quarter income tax benefit was recognized via a reduction of amounts previously recorded as additional paid in capital upon exercise of stock options. In the current fiscal quarter, we have realized a tax benefit of $89,000 upon similar exercises of stock options.

The Company anticipates that share-based compensation for 2016 will not exceed $800,000 net of tax benefits.

The fair value of each option grant is estimated on the date of grant using the Black-Scholes options-pricing model with the following weighted average assumptions used for grants in fiscal 2016 first six months: expected volatility of 15.9%; risk-free interest rate of 1.2%; dividend rate of 1.4% and expected lives of 5 years.

During the 2016 six month period, the Company granted 159,170 stock options. The weighted-average grant date fair value of these options was $13.94. During the 2015 six month period, the Company granted 148,840 stock options. The weighted-average grant date fair value of these options was $15.23.

Expected volatility is based on the historical volatility of the price of our common shares over the past 49 months for 5 year options and 10 years for 10 year options. We use historical information to estimate expected life and forfeitures within the valuation model. The expected term of awards represents the period of time that options granted are expected to be outstanding. The risk-free rate for periods within the expected life of the option is based on the U.S. Treasury yield curve in effect at the time of grant. Compensation cost is recognized using a straight-line method over the vesting or service period and is net of estimated forfeitures.