• Filing Date: 2013-08-09
  • Form Type: 10-Q
  • Description: Quarterly report
v2.4.0.8
6. STOCK BASED COMPENSATION
6 Months Ended
Jun. 28, 2013
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]  
Note 6 - STOCK BASED COMPENSATION

We approved an option plan in 2008 permitting the grant of 6.4 million stock options to employees for the purpose of attracting and motivating employees, officers and directors.

 

On February 22, 2013, we awarded our new Chief Executive Officer stock options for 1.5 million shares pursuant to our 2008 Stock Incentive Plan. These options were granted with a term of ten years from the date of grant and vest over a period of four years, with 25% vesting on the first anniversary of the date of grant and 25% vesting each anniversary thereafter for the following three years. The exercise price is $.20 per share. Pursuant to previous awards, there were 1,695,500 options vested at June 28, 2013 and 1,373,000 options vested at June 29, 2012.

 

The fair value of each option award is estimated on the date of grant using the Black-Scholes option-pricing model. The assumptions used to calculate the fair value are as follows: 

 

  June 28, 2013   June 29, 2012
Expected term (years) 5.0   5.0
Expected volatility 114.1%   116.9%
Dividend yield 0.0%   0.0%
Risk-free rate 0.8%   0.8%

 

The following table summarizes our stock options outstanding at December 28, 2012 and changes during the period ended June 28, 2013:

 

    Number of Shares Under Option   Weighted Average Exercise Price Per Share   Weighted Average Grant Date Fair Value   Aggregate Intrinsic Value
Outstanding, December 28, 2012 4,083,000   $           0.20   $          0.17   $   1,774,460
  Granted 1,500,000   0.20   0.16   375,000
  Forfeited  (68,500)   0.39   0.32    (17,125)
  Expired  (5,000)   0.17   0.15    (400)
Outstanding, March 29, 2013 5,509,500   0.26   0.21     2,131,935
  Forfeited  (563,500)   0.28   0.22    (107,065)
  Expired  (337,000)   0.18   0.15    (1,740)
Outstanding, June 28, 2013 4,609,000   0.26    0.21    $   2,023,130

  

The following table summarizes our nonvested stock options outstanding at December 28, 2012, and changes during the period ended June 28, 2013:

 

     Number of Options    Weighted Average Exercise Price per Share    Weighted Average Grant Date Fair Value    Aggregate Intrinsic Value
Nonvested, December 28, 2012 2,735,750   $           0.17   $          0.15   $    1,483,612
  Granted 1,500,000   0.20   0.16   375,000
  Forfeited  (68,500)   0.39   0.32    (17,125)
Nonvested, March 29, 2013 4,167,250   0.28   0.23        1,841,487
  Vested  (690,250)   0.30   0.25    (131,147)
  Forfeited  (563,500)   0.28   0.22    (107,065)
Nonvested, June 28, 2013 2,913,500   0.28    0.22    $    1,603,275

 

The following table summarizes information about our stock options outstanding, and reflects the intrinsic value recalculated based on the closing price of our common stock at June 28, 2013:

 

   Number of Options    Weighted Average Exercise Price Per Share    Weighted Average Remaining Contractual Life (years)    Aggregate Intrinsic Value  
Outstanding          4,609,000   $           0.26   3.36   $     826,945
Exercisable          1,695,500   0.23   2.19   98,570

 

 We recognized share-based compensation expense relating to the vesting of issued stock options of approximately $90,000 and $52,000 for the periods ended June 28, 2013 and June 29, 2012, respectively. As of June 28, 2013, there was unrecognized share-based compensation expense totaling approximately $504,000 relating to non-vested options that will be recognized over the next 3.7 years.