Earnings Per Share

3 Months Ended

Nov. 26, 2011

Earnings Per Share [Abstract]

Earnings Per Share

NOTE 7 – EARNINGS PER SHARE

Basic earnings per common share (EPS) is calculated by dividing net income or loss by the weighted-average number of common shares outstanding for the period. Diluted EPS is calculated by dividing net income or loss by the weighted-average number of common shares outstanding plus the assumed exercise of all dilutive securities using the treasury stock method or the "if converted" method, as appropriate. Due to modifications to our management stock loan program, we determined that the shares of management stock loan participants that were placed in the escrow account are participating securities because they continue to have equivalent common stock dividend rights. Accordingly, these management stock loan shares are included in our basic EPS calculation during periods of net income and excluded

from the basic EPS calculation in periods of net loss. Our unvested share-based compensation awards are not entitled to participate in dividends until they vest and are excluded from our EPS calculation.

The following table presents the computation of our EPS for the periods indicated (in thousands, except per share amounts):

		Quarter Ended
		November 26,		November 27,
		2011			2010
Numerator for basic and diluted
earnings per share:
Income before income taxes	$	3,074		$	2,741
Income tax provision		(1,412	)		(1,947	)
Net income	$	1,662		$	794
Denominator for basic and
diluted earnings per share:
Basic weighted average shares
outstanding(1)		17,733			17,032
Effect of dilutive securities:
Stock options and other share-
based awards		30			83
Common stock warrants(2)		235			-
Diluted weighted average shares
outstanding		17,998			17,115
EPS Calculations:
Net income per share:
Basic and diluted	$	.09		$	.05

(1) Since we recognized net income for the quarters ended November 26, 2011 and November 27, 2010, basic weighted average shares for those periods include 3.3 million shares and 3.4 million shares, respectively, of common stock held by management stock loan participants that were placed in escrow.

(2) For the quarter ended November 27, 2010, the conversion of 6.2 million common stock warrants was not assumed because such conversion would be anti-dilutive.

At November 26, 2011 and November 27, 2010, we had approximately 0.7 million and 0.5 million stock options outstanding, which were not included in the computation of diluted EPS because the options' exercise prices were greater than the average market price of our common shares for the respective periods. Although these shares were not included in our calculation of diluted EPS, these stock options, and other dilutive securities, including performance share-based compensation instruments, may have a dilutive effect on our EPS calculation in future periods if the price of our common stock increases.