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SHAREHOLDERS' EQUITY
 12 Months Ended
Aug. 31, 2020
Equity [Abstract]  
SHAREHOLDERS' EQUITY

NOTE 8 - SHAREHOLDERS' EQUITY

 

Dividend

The Company’s Board of Directors declared cash dividends during fiscal year 2020, 2019 and 2018. The details of dividend paid are in the following tables:

 

                  
FY2018
                
Record Date  Distribution Date  Number of Shares
Outstanding on
Record Date		   Dividend per
Share		   Total Amount 
11/13/2017  11/20/2017   17,284,792   $0.06   $1,037,088 
1/26/2018  2/02/2018   17,317,752   $0.06    1,039,065 
4/25/2018  5/02/2018   17,354,005   $0.06    1,041,240 
7/26/2018  8/02/2018   17,405,775   $0.06    1,044,347 
Total               $4,161,740 

 

FY2019

 

Record Date  Distribution Date  Number of Shares
Outstanding on
Record Date		   Dividend per
Share		   Total Amount 
11/01/2018  11/08/2018   17,417,875   $0.06   $1,045,073 
1/25/2019  2/01/2019   17,481,450   $0.06    1,048,887 
4/24/2019  5/01/2019   17,515,228   $0.06    1,050,914 
7/25/2019  8/01/2019   17,536,454   $0.06    1,052,181 
Total               $4,197,055 

 

FY2020

 

Record Date  Distribution Date  Number of Shares
Outstanding on
Record Date		   Dividend per
Share		   Total Amount 
10/25/2019  11/01/2019   17,606,314   $0.06   $1,056,379 
1/27/2020  2/03/2020   17,645,639   $0.06    1,058,740 
4/24/2020  5/01/2020   17,769,134   $0.06    1,066,148 
7/27/2020  8/03/2020   17,820,057   $0.06    1,069,203 
Total               $4,250,470 

 

Although dividend distributions are currently expected to continue on a quarterly basis, the Company’s Board of Directors reserves the right to discontinue the dividend distribution any time.

 

Stock Option Plan

On February 23, 2007, the Board of Directors adopted, and the shareholders approved, the 2007 Stock Option Plan under which a total of 1,000,000 shares of common stock had been reserved for issuance. On February 25, 2014 the shareholders approved an additional 1,000,000 shares increasing the total number of shares that may be granted under the Option Plan to 2,000,000. This plan terminated in February 2017 by its term.

 

On December 23, 2016 the Board of Directors adopted, and on February 23, 2017 the shareholders approved, the 2017 Equity Incentive Plan under which a total of 1,000,000 shares of common stock has been reserved for issuance. This plan will terminate in December 2026.

 

As of August 31, 2020, employees and directors hold stock options to purchase 1,223,661 shares of common stock at exercise prices ranging from $6.75 to $61.84 per share.

 

The following table summarizes information about stock options:

 

               
Transactions in FY18  Number of
Options		   Weighted-Average
Exercise Price
Per Share		   Weighted-Average
Remaining
Contractual Life		 
             
Outstanding, August 31, 2017   1,249,126   $8.51    7.74 
Granted   52,000    22.36      
Exercised   (130,006)   5.97      
Canceled/Forfeited   (30,144)   9.10      
Expired   (6,000)   5.06      
Outstanding, August 31, 2018   1,134,976   $9.44    7.31 
Vested and Exercisable, August 31, 2018   483,696   $7.79    6.48 
Vested and Expected to Vest, August 31, 2018   1,069,807   $9.35    7.26 

 

Transactions in FY19  Number of
Options		   Weighted-Average
Exercise Price
Per Share		   Weighted-Average
Remaining
Contractual Life		 
             
Outstanding, August 31, 2018   1,134,976   $9.44    7.31 
Granted   263,500    22.78      
Exercised   (166,703)   7.15      
Canceled/Forfeited   (68,514)   12.17      
Expired   –    –      
Outstanding, August 31, 2019   1,163,259   $12.63    7.13 
Vested and Exercisable, August 31, 2019   515,394   $8.57    6.09 
Vested and Expected to Vest, August 31, 2019   1,101,800   $12.39    7.07 

 

Transactions in FY20  Number of
Options		   Weighted-Average
Exercise Price
Per Share		   Weighted-Average
Remaining
Contractual Life		 
             
Outstanding, August 31, 2019   1,163,259   $12.63    7.13 
Granted   223,000    39.23      
Exercised   (121,647)   9.29      
Canceled/Forfeited   (40,951)   14.19      
Expired   –    –      
Outstanding, August 31, 2020   1,223,661   $17.76    6.79 
Vested and Exercisable, August 31, 2020   596,311   $10.69    5.59 
Vested and Expected to Vest, August 31, 2020   1,194,239   $17.75    6.77 

 

Intrinsic Value of options outstanding and options exercisable

 

               
   Intrinsic Value
of Options
Outstanding		   Intrinsic
Value of
Options
Exercisable		   Intrinsic
Value of
Options
Exercised		 
FY18  $13,064,884   $6,315,086   $1,495,313 
FY19  $27,312,742   $14,194,724   $3,224,454 
FY20  $51,272,966   $29,150,912   $4,085,753 

 

The weighted-average remaining contractual life of options outstanding issued under the Plan, both Qualified ISO and Non-Qualified SO, was 6.79 years at August 31, 2020. The total fair value of non-vested stock options as of August 31, 2020 was $22,122,054 and is amortizable over a weighted average period of 3.39 years.

 

The fair value of these options was estimated at the date of grant using the Black-Scholes option-pricing model. The Black-Scholes option valuation model was developed for use in estimating the fair value of traded options, which do not have vesting restrictions and are fully transferable. In addition, option valuation models require the input of highly subjective assumptions, including the expected stock price volatility. Because our stock options have characteristics significantly different from those of traded options, and because changes in the subjective input assumptions can materially affect the fair value estimate, in management's opinion, the existing models do not necessarily provide a reliable single measure of the fair value of its stock options.

 

The following table summarizes the fair value of the options, including both ISOs and NQSOs, granted during the current fiscal year 2020 and fiscal year 2019:

 

          
   FY 2020   FY 2019 
Estimated fair value of awards granted  $2,997,120   $1,928,820 
Unvested Forfeiture Rate   0%    6.20% 
Weighted average grant price  $39.23   $22.78 
Weighted average market price  $39.23   $22.69 
Weighted average volatility   33.56%    31.61% 
Weighted average risk-free rate   1.39%    2.59% 
Weighted average dividend yield   0.65%    1.10% 
Weighted average expected life   6.67 years    6.64 years 

 

The exercise prices for the options outstanding at August 31, 2020 ranged from $6.75 to $61.84, and the information relating to these options is as follows:

 

                                     
Exercise Price   Awards Outstanding   Awards Exercisable 
Low   High   Quantity   Weighted
Average
Remaining
Contractual
Life		   Weighted
Average
Exercise
Price		   Quantity   Weighted
Average
Remaining
Contractual
Life		   Weighted
Average
Exercise
Price		 
$6.75   $8.00    177,730    4.0 years   $6.85    177,730    4.0 years   $6.85 
$8.01   $16.00    547,901    6.0 years   $9.98    350,721    6.0 years   $9.97 
$16.01   $24.00    230,280    7.8 years   $20.70    50,560    7.2 years   $21.18 
$24.01   $38.00    204,950    9.1 years   $33.45    17,300    8.9 years   $34.23 
$38.01   $52.00    19,800    9.6 years   $38.64    –    –    – 
$52.01   $61.84    43,000    9.9 years   $61.84    –    –    – 
           1,223,661    6.8 years   $17.76    596,311    5.6 years   $10.69 

 

Follow-on Public Offering

 

In August 2020, the company closed an underwritten public offering of 2,090,909 shares of its common stock to the public at $55.00 per share, which included the full exercise of the underwriters’ option to purchase 272,727 additional shares of common stock. The aggregate gross proceeds to the company from this offering were approximately $115 million, before deducting underwriting discounts and commissions; net proceeds were approximately $107.7 million . The offering was made pursuant to the Company’s automatic shelf registration statement on Form S-3 filed with the Securities and Exchange Commission on July 9, 2020.