NOTE 5 - STOCK COMPENSATION PLANS

9 Months Ended

Sep. 29, 2012

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

NOTE 5 – STOCK COMPENSATION PLANS

In April 2012, the Compensation Committee of the Board of Directors approved an increase of 500,000 shares under our 2009 Equity Incentive Plan (the “Equity Plan”), which was subsequently approved by our shareholders. As of November 14, 2012, 502,335 shares of restricted stock have been granted under the Equity Plan, of which 133,115 remain subject to outstanding awards.  Unvested restricted stock awards and restricted stock units are included in diluted earnings per share until the shares have been vested.  The vested shares are then included in basic earnings per share.

Total share-based compensation expense of approximately $18,000 and $109,000 was recognized during the three-months ended September 29, 2012 and September 30, 2011, respectively. Total share-based compensation expense in the amount of $177,000 and $307,000 was recognized during the nine months ended September 29, 2012 and September 30, 2011, respectively. Share-based compensation expense is reported in selling, general and administrative expense.

Restricted Stock Awards

Restricted stock awards granted to directors are intended to compensate and retain the directors over the one-year service period commencing July 1 of the year of service.  These awards vest in quarterly installments beginning September 30 of the year of service, so long as the grantee continues to serve as a director of the Company.  Restricted stock awards granted to employees vest in four equal annual installments beginning December 31 in the year granted, so long as the grantee remains employed full-time with the Company as of each vesting date.  During 2012, the Company granted restricted stock awards per the following table:

Date Issued	Issued to	Number of Individuals	Number of Shares	Market Price		Fair Value		Grants Forfeited
June 14, 2012	Employee	1	50,336	$	1.49	$	75,000	—
June 14, 2012	Director	3	100,671	$	1.49	$	150,000	—

The amount of compensation expense related to all restricted stock awards that had not been recognized at September 29, 2012, totaled $173,000.  This compensation expense is expected to be recognized over a weighted-average period of approximately 17 months.