STOCKHOLDERS' EQUITY

6 Months Ended

Feb. 29, 2024

Stockholders' Equity Note [Abstract]

STOCKHOLDERS' EQUITY [Text Block]

6. STOCKHOLDERS' EQUITY

[a] Common stock issued and authorized

The Company is authorized to issue up to 20,000,000 shares of common stock, par value $0.001 per share.

During the three  and six months ended February 29, 2024, the Company did not issue any common stock (February 28, 2023 - Nil). During the three and six months ended February 29, 2024, the Company repurchased and cancelled 137,300 and 309,300 common shares for $135,902 and $306,680, respectively (February 28, 2023 - Nil and Nil, respectively).

[b] Stock option plans

Pursuant to the Company's 2015 Stock Option Plan (the "2015 Plan"), 530,000 shares of common stock have been reserved for issuance. A total of 420,000 common shares remain eligible for issuance under the 2015 Plan. On February 18, 2022 the Company received shareholder approval for the 2022 Stock Option Plan (the "2022 Plan") (together with the 2015 Plan, the "Plans"), whereby 1,000,000 common shares are reserved for issuance. As of February 29, 2024, 376,166 common shares remain eligible for issuance under the 2022 Plan.

The options generally vest over a range of periods from the date of grant, some are immediate, and others vest over 24 months. Any options that do not vest as the result of a grantee leaving the Company are forfeited and the underlying common shares are returned to the reserve. The options generally have a contractual term of five years.

Stock-Based Payment Award Activity

A summary of stock option activity under the Plans as of February 29, 2024, and changes during the period were the following:

	Number of Options			Weighted Average Exercise Price	Weighted Average Contractual Term (Years)		Aggregate Intrinsic Value
Outstanding at August 31, 2022	593,000		$	1.49	3.79	$	-
Granted	228,000		$	0.85	4.90	$	-
Forfeited	(72,000	)	$	1.41	3.41	$	-
Outstanding at August 31, 2023	749,000		$	1.30	3.37	$	-
Forfeited	(13,416	)	$	0.86	4.37	$	3,028
Expired	(1,750	)	$	1.50	2.67	$	-
Outstanding at February 29, 2024	733,834		$	1.31	2.85	$	51,912
Exercisable at February 29, 2024	588,516		$	1.42	2.49	$	20,022

The aggregate intrinsic value is calculated as the difference between the exercise price of the underlying awards and the quoted price of the Company's common stock for the options that were in-the-money as of February 29, 2024. As of February 29, 2024, the aggregate intrinsic value of outstanding and exercisable options was $51,912 and $20,022, respectively (February 28, 2023 - $Nil and $Nil, respectively). There were no stock options repurchased during the six months ended February 29, 2024 (February 28, 2023 - Nil).

As of February 29, 2024, there was $59,156 (February 28, 2023 - $141,020) of total unrecognized compensation cost related to non-vested stock-based compensation awards. The unrecognized compensation cost is expected to be recognized over a weighted average period of 0.83 years (February 28, 2023 - 1 year).

During the three and six months ended February 29, 2024, the Company recorded $10,655 and $24,460 in non-cash stock-based compensation, respectively (February 28, 2023 - $38,085 and $75,242, respectively).

[c] Employee Stock Purchase Plan

The Company's 2011 Employee Stock Purchase Plan (the "ESPP") became effective on February 22, 2011. Under the ESPP, employees of the Company can contribute up to 5% of their annual salary into a pool which is matched equally by the Company in order to purchase the Company's common shares under certain terms. Directors can contribute a maximum of $12,500 each for a combined maximum annual purchase of $25,000. The maximum annual combined contributions will be $400,000. All purchases are made through TSXV by a third-party plan agent. The third-party plan agent is also responsible for the administration of the ESPP on behalf of the Company and the participants.

During the three and six months ended February 29, 2024, the Company recognized compensation expense of $24,160 and $45,982, respectively (February 28, 2023 - $51,498 and $70,170, respectively) in salaries and wages on the condensed consolidated statement of comprehensive income (loss) in respect of the ESPP, representing the Company's employee matching of cash contributions to the ESPP. The shares were purchased on the open market at an average price of $1.01 over a six-month period (February 28, 2023 - $1.15). The shares are held in trust by the Company for a period of one year from the date of purchase. As of February 29, 2024, 202,247 shares were held in trust by the Company.

[d] Earnings Per Share

Net income (loss) per common share (basic) is calculated by dividing net income (loss) by the weighted average number of common shares outstanding during the period. Net income (loss) per common share (diluted) is calculated by dividing net income (loss) for the period by the weighted average number of common shares outstanding during the period, plus the dilutive effect of outstanding common share equivalents. This method requires that the dilutive effect of outstanding options and warrants issued be calculated using the treasury stock method. Under the treasury stock method, all common share equivalents have been exercised at the beginning of the period (or at the time of issuance, if later), and that the funds obtained thereby were used to purchase common shares of the Company at the average trading price of common shares during the period, but only if dilutive. The following table shows the computation of basic and diluted earnings per share for the three and six months ended February 29, 2024 and February 28, 2023:

		Three Months Ended						Six Months Ended
		February 29, 2024			February 28, 2023			February 29, 2024		February 28, 2023
Numerator:
Net income (loss)	$	(130,012	)	$	(1,276	)	$	119,504	$	256,990
Denominator:
Weighted-average basic shares outstanding		9,842,720			10,122,261			9,926,627		10,122,261
Effect of dilutive stock-based awards		264,834			-			264,834		-
Weighted-average diluted shares		10,107,554			10,122,261			10,191,461		10,122,261
Basic and diluted earnings per share	$	(0.01	)	$	(0.00	)	$	0.01	$	0.03

469,000 stock options were excluded from the computation of diluted earnings per share for the three and six months ended February 29, 2024 because their effect would have been antidilutive.