4.	Stock-Based Compensation

Our 2008 Stock Option and Stock Incentive Plan (the “Plan”) was approved by our shareholders on May 20, 2009. Under the terms of the Plan, our Board of Directors may grant up to 2,000,000 shares of common stock in the form of shares of restricted stock, incentive stock options and non-qualified stock options or combinations thereof to officers, directors, employees, consultants and advisors. Grants under the Plan must be made within ten years of the date the Plan was approved and stock options are exercisable upon the terms set forth in the grant agreement approved by the Board of Directors, but in no event more than ten years from the date of grant. Restricted stock vests in accordance with the terms set forth in each restricted stock agreement. At March 28, 2015, 1,683,562 shares were available for grant under the Plan.

We grant restricted stock to certain employees and members of our Board of Directors. The value of restricted stock issued is based on the fair value of our common stock on the grant date. Vesting of restricted stock is conditional based on continued employment or service for a specified period and in certain circumstances, the attainment of financial goals. We retain the restricted stock, and any dividends paid thereto, until the vesting conditions have been met. For awards with a service condition only, compensation cost related to restricted stock is recognized on a straight-line basis over the vesting period. For awards that have a service condition and require the attainment of financial goals, compensation cost related to restricted stock is recognized over the vesting period if it is probable that the financial goals will be attained. Compensation cost related to restricted stock was $0.3 million and $0.5 million for the thirteen weeks ended March 28, 2015 and March 29, 2014, respectively.

The following table summarizes our restricted stock activity for the thirteen weeks ended March 28, 2015:


	Shares			Weighted Average Price
Balance at December 27, 2014		72,900		$	27.82
Granted		36,604		$	45.39
Vested		(13,660	)	$	24.78
Cancelled		(400	)	$	18.94

Balance at March 28, 2015		95,444		$	35.03

As of March 28, 2015, there was approximately $2.3 million of unrecognized compensation cost related to nonvested restricted stock, which is expected to be recognized over a weighted-average period of approximately 1.7 years.

Cash flows resulting from tax deductions in excess of the tax effect of compensation cost recognized in the financial statements are classified as financing cash flows. The excess tax benefit generated from restricted shares which vested in the thirteen weeks ended March 28, 2015 was $0.1 million and was credited to additional paid-in capital.

We grant stock options to certain employees and members of the Board of Directors. We expense the grant-date fair value of stock options. Compensation cost is recognized on a straight-line basis over the vesting period for which related services are performed. The compensation cost charged against income for the thirteen weeks ended March 28, 2015 and March 29, 2014 was less than $0.1 million in each period. The compensation costs were classified as selling, general and administrative expense in the Consolidated Statements of Income. No cost was capitalized during fiscal 2015 or fiscal 2014.

No stock options were granted during the thirteen weeks ended March 28, 2015 or March 29, 2014. Historically, we have used the Black-Scholes option valuation model to estimate the fair value of stock options granted. Expected volatility and expected dividend yield were based on the actual historical experience of our common stock. The expected life represents the period of time that options granted are expected to be outstanding and was calculated using historical option exercise data. The risk-free rate was based on a U.S. Treasury security with terms equal to the expected time of exercise as of the grant date. We included a forfeiture assumption of 5.4% for fiscal 2015 and fiscal 2014 in the calculation of compensation cost.

The following table summarizes our stock option activity for the thirteen weeks ended March 28, 2015:


	Shares			Weighted Average Price		Weighted Average Remaining Term (In years)		Aggregate Intrinsic Value
Balance at December 27, 2014		75,000		$	7.28
Exercised		(29,000	)	$	6.16

Balance at March 28, 2015		46,000		$	7.98		3.3	$	1,866,000

Options exercisable at March 28, 2015		44,000		$	7.47		3.2	$	1,807,000

The total intrinsic value of stock options exercised in the thirteen weeks ended March 28, 2015 was $1.2 million. As of March 28, 2015, there was less than $0.1 million of unrecognized compensation cost related to non-vested stock options, which is expected to be recognized over a weighted-average period of less than one year.

Cash received from option exercises was approximately $0.3 million in the thirteen weeks ended March 29, 2014. The excess tax benefit generated from options which were exercised in the thirteen ended March 29, 2014 was $0.1 million, and was credited to additional paid-in capital. There was no cash received or excess tax benefit generated in the thirteen weeks ended March 28, 2015.