Note 10 – Stock-based Compensation

The Company has two incentive stock plans, the 2014 Omnibus Equity Compensation Plan (the “2014 Plan”) and the 2021 Incentive Plan (the “2021 Plan”). As a result of the approval of the 2021 Plan by the Company’s stockholders at the Company’s 2021 annual meeting of stockholders, grants may no longer be issued under the 2014 Plan.

The Company believes that awards of long-term, equity-based incentive compensation will attract and retain directors, officers and employees of the Company and will encourage these individuals to contribute to the successful performance of the Company, which will lead to the achievement of the Company’s overall goal of increasing stockholder value. Awards granted under the 2021 Plan may be in the form of incentive stock options, non-qualified stock options, shares of restricted or unrestricted stock, stock units, stock appreciation rights, or other stock-based awards. Awards may be granted subject to the achievement of performance goals or other conditions, and certain awards may be payable in stock or cash, or a combination of the two. The 2021 Plan is administered by the Compensation Committee of the Board, which selects eligible employees, non-employee directors and other individuals to participate in the 2021 Plan and determines the type, amount, duration (such duration not to exceed a term of ten (10) years for grants of stock options) and other terms of individual awards. At March 29, 2026, 125,504 shares of the Company’s common stock were available for future issuance under the 2021 Plan, which may be issued from authorized and unissued shares of the Company’s common stock or treasury shares.

Stock-based compensation is calculated according to FASB ASC Topic 718, Compensation – Stock Compensation, which requires stock-based compensation to be accounted for using a fair-value-based measurement. During fiscal years 2026 and 2025, the Company recorded $766 thousand and $752 thousand of stock-based compensation, respectively. The Company records the compensation expense associated with stock-based awards granted to individuals in the same expense classifications as the cash compensation paid to those same individuals. All stock awards are expensed over the vesting period and are adjusted for forfeitures as occurred.

Stock Options: The following table represents stock option activity for fiscal years 2026 and 2025:

At March 29, 2026, there was no intrinsic value of both the outstanding and exercisable stock options. There were no stock options exercised during the fiscal years ended March 29, 2026, and March 30, 2025. As of March 30, 2025, there was no intrinsic value of both the outstanding and exercisable options.

To determine the estimated fair value of stock options granted, the Company uses the Black-Scholes-Merton valuation formula, which is a closed-form model that uses an equation to estimate fair value. The following table sets forth the assumptions used to determine the fair value of the non-qualified stock options awarded to certain employees during fiscal year 2025, which options vest over a two-year period, assuming continued service.

For the fiscal year ended March 29, 2026, the Company recognized $15 thousand as compensation expense associated with stock options with $8 thousand in cost of products sold and $7 thousand in marketing & administrative expenses. For the fiscal year ended March 30, 2025, the Company recognized $39 thousand as compensation expense associated with stock options with $21 thousand in cost of products sold and $18 thousand in marketing & administrative expenses.

A summary of stock options outstanding and exercisable as of March 29, 2026 is as follows:

As of March 29, 2026, total unrecognized stock-option compensation costs amounted to $3 thousand, which will be recognized as the underlying stock options vest over a weighted-average period of 3.0 months. The amount of future stock-option compensation expense could be affected by any future stock option grants and by the separation from the Company of any employee or director who has stock options that are unvested as of such individual’s separation date.

Time-Based Restricted Shares: The Company issues time-based restricted shares to the Board of Directors and certain officers and executives under our stock-based compensation plan. The time-based restricted shares automatically convert to shares of common stock on a one-for-one basis as the awards vest. The time-based restricted shares typically vest over a one-to-three-year vesting period on the anniversary of the grant date. The grant date fair value is equal to the quoted market price for the shares on the date of the grant. The total fair value of time-based restricted shares vested during the twelve months ended March 29, 2026 and March 30, 2026 was $410 thousand and $573 thousand, respectively. The following table summarizes the Company’s non-vested share activity for the years ended March 30, 2025 and March 29, 2026:

Performance Award Shares: On  March 1, 2022, performance awards were granted to certain of the Company’s executive officers, consisting of 187,500 shares, of which: (a) 75,000 shares shall be earned if the closing price per share of the Company’s common stock equals or exceeds $8.00 on ten trading days within any period of twenty consecutive trading days prior to  March 1, 2027; and (b) 112,500 shares shall be earned if the closing price per share of the Company’s common stock equals or exceeds $9.00 on ten trading days within any period of twenty consecutive trading days prior to  March 1, 2027.  Upon the achievement of each applicable stock hurdle described above: (i) one-third of the shares that are earned shall vest on the later of the date on which the shares are earned and  March 1, 2023; (ii) one-third of the shares that are earned shall vest on the first anniversary of the date on which the shares are earned; and (iii) one-third shall vest on the second anniversary of the date on which the shares are earned. All shares that are non-earned or non-vested will be forfeited upon the termination of service. The Company, with the assistance of an independent third party, determined that the grant date fair value of the awards amounted to $732 thousand. On October 27, 2025, 62,500 of these performance award shares were forfeited.

For the fiscal years ended March 29, 2026 and March 30, 2025, the Company recognized compensation expense associated with non-vested stock grants, which is included in marketing and administrative expenses, of $751 thousand and $713 thousand, respectively.

As of March 29, 2026, total unrecognized compensation expense related to the Company’s non-vested stock grants was $857 thousand, which will be recognized over the remaining portion of the respective vesting periods associated with each block of grants, such grants having a weighted average vesting term of 17.5 months.

In connection with the retirement of Craig J. Demarest as the Company’s Chief Financial Officer, Vice President and Secretary effective June 30, 2025, the Compensation Committee of the Board accelerated the vesting of the restricted stock award, consisting of 25,000 shares of the Company’s common stock, granted to Mr. Demarest on March 26, 2024, pursuant to the 2021 Plan (the “Award”). The Award was originally scheduled to vest in its entirety on March 26, 2027 (from March 26, 2024, through March 26, 2027, the “Vesting Period”). The Award now will vest on the last day of Mr. Demarest’s employment with the Company (which is expected to be July 1, 2025) as to a number of shares of the Company’s common stock equal to the product of (i) 25,000, multiplied by (ii) a fraction, the numerator of which is the number of days Mr. Demarest was employed by the Company during the Vesting Period and the denominator of which is the number of calendar days in the Vesting Period. The unvested portion of the Award, as of the last day of Mr. Demarest’s employment with the Company, will be forfeited.