• Filing Date: 2013-11-07
  • Form Type: 10-Q
  • Description: Quarterly report
v2.4.0.8
6. STOCK BASED COMPENSATION
9 Months Ended
Sep. 27, 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 $0.20 per share. Pursuant to previous awards, there were 1,568,750 and 1,373,000 options vested at September 27, 2013 and September 28, 2012, respectively.

 

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:

 

   

September 27,

2013

   

September 28,

2012

 
Expected term (years)     5.0       5.0  
Expected volatility     111.4 %     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 September 27, 2013:

 

    Number of Shares Under Options     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  
Forfeited     (97,250 )     0.37       0.30       (39,873 )
Expired     (126,750 )     0.28       0.22       (16,470 )
Outstanding, September 27, 2013     4,385,000       0.26        0.21     $ 1,966,787  

 

The following table summarizes our nonvested stock options outstanding at December 28, 2012, and changes during the period ended September 27, 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       (131,148 )
Forfeited     (563,500 )     0.28       0.22       (107,065 )
Nonvested, June 28, 2013     2,913,500       0.28       0.22       1,603,274  
Forfeited     (97,250 )     0.37       0.30       (39,873 )
Nonvested, September 27, 2013     2,816,250       0.27       0.22     $ 1,563,401  

 

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 September 27, 2013:

 

    Number of Options     Weighted Average Exercise Price Per Share     Weighted Average Remaining Contractual Life (years)     Aggregate Intrinsic Value  
Outstanding     4,385,000     $ 0.26       3.16     $ 798,643  
Exercisable     1,568,750       0.23       1.98       94,580  

 

We recognized share-based compensation expense relating to the vesting of issued stock options of approximately $112,000 and $95,000 for the periods ended September 27, 2013 and September 28, 2012, respectively. As of September 27, 2013, there was unrecognized share-based compensation expense totaling approximately $464,000 relating to non-vested options that will be recognized over the next 3.5 years.