STOCK BASED COMPENSATION

12 Months Ended

Aug. 31, 2021

NOTE 8 – STOCK BASED COMPENSATION

Stock Based Compensation – The Company utilizes three types of equity awards: restricted stock awards (“RSAs”), restricted stock units (“RSUs”) and performance based restricted stock units (“PSUs”). Refer “Note 2 - Summary of Significant Accounting Policies.”

The Company adopted the 2013 Equity Incentive Award Plan (the "2013 Plan") for the benefit of its eligible employees, consultants and non-employee directors on January 22, 2013. The 2013 Plan provides for awards covering up to 1.1 million shares of common stock plus the number of shares that remained available for issuance as of January 22, 2013 under three equity participation plans previously maintained by the Company. The 2013 plan was amended in fiscal year 2021 to increase the number of shares of Common Stock available for the grant of awards by 500,000 shares. The number of shares reserved for issuance under the 2013 Plan increases during the term of the plan by the number of shares relating to awards outstanding under the 2013 Plan or any of the prior plans that expire, or are forfeited, terminated, canceled or repurchased, or are settled in cash in lieu of shares. However, in no event will more than an aggregate of 2,031,818 shares of the Company’s common stock be issued under the 2013 Plan. The following table summarizes the shares authorized and shares available for future grants:



		Shares available to grant
	Shares authorized for issuance as of August 31, 2021	August 31,		August 31,
	(including shares originally authorized for issuance under prior plans)	2021		2020
2013 Plan	1,562,832		705,924		297,366

The following table summarizes the components of the stock-based compensation expense for the twelve-month periods ended August 31, 2021, 2020 and 2019 (in thousands), which are included in general and administrative expense and warehouse club and other operations in the consolidated statements of income:



	Years Ended August 31,
	2021		2020		2019
Restricted stock awards	$	11,010	$	8,747	$	11,477
Restricted stock units		3,939		3,011		2,820
Performance-based restricted stock units		3,475		2,059		764
Stock-based compensation expense	$	18,424	$	13,817	$	15,061

The following tables summarize other information related to stock-based compensation:



	Balance as of
	August 31,		August 31,		August 31,
	2021		2020		2019
Remaining unrecognized compensation cost (in thousands)	$	16,349	$	21,720	$	21,116
Weighted average period of time over which this cost will be recognized (years)		2		2		3



	Years Ended
	August 31,		August 31,		August 31,
	2021		2020		2019
Excess tax deficiency on stock-based compensation (in thousands)	$	(778)	$	(936)	$	(1,829)

The restricted stock awards and units generally vest over a three-year period and the unvested portion of the award is forfeited if the employee or non-employee director leaves the Company before the vesting period is completed. Restricted stock awards, restricted stock units, and performance-based restricted stock units activity for the twelve-months ended August 31, 2021, 2020 and 2019 was as follows:



	Years Ended
	August 31,		August 31,		August 31,
	2021		2020		2019
Grants outstanding at beginning of period		415,869		362,826		385,417
Granted		166,160		266,759		193,489
Forfeited		(12,436)		(43,198)		(16,127)
Vested		(193,971)		(170,518)		(199,953)
Grants outstanding at end of period		375,622		415,869		362,826

The following table summarizes the weighted average per share grant date fair value for restricted stock awards, restricted stock units, and performance based restricted stock units for fiscal years 2021, 2020 and 2019:



	Years Ended
	August 31,		August 31,		August 31,
Weighted Average Grant Date Fair Value	2021		2020		2019
RSAs, RSUs, and PSUs granted	$	79.02	$	64.57	$	65.11
RSAs, RSUs, and PSUs vested	$	70.03	$	72.82	$	79.28
RSAs, RSUs, and PSUs forfeited	$	70.56	$	76.81	$	75.02

The following table summarizes the total fair market value of restricted stock awards, restricted stock units, and performance based restricted stock units vested for the period (in thousands):



	Years Ended
	August 31,		August 31,		August 31,
	2021		2020		2019
Total fair market value of RSAs, RSUs, and PSUs vested (in thousands)	$	17,478	$	10,914	$	12,302

At the vesting dates for restricted stock awards to employees, the Company repurchases a portion of the shares that have vested at the prior day's closing price per share, with the funds used to pay the employees' minimum statutory tax withholding requirements related to the vesting of restricted stock awards. The Company expects to continue this practice going forward. The Company does not have a stock repurchase program.

Shares of common stock repurchased by the Company are recorded at cost as treasury stock and result in the reduction of stockholders’ equity in the Company’s consolidated balance sheets. The Company may reissue these treasury shares.

The following table summarizes the shares repurchased during fiscal years 2021, 2020 and 2019:



	Years Ended
	August 31,		August 31,		August 31,
	2021		2020		2019
Shares repurchased		62,282		56,503		75,462
Cost of repurchase of shares (in thousands)	$	5,542	$	3,651	$	4,604

The Company reissues treasury shares as part of its stock-based compensation programs. The following table summarizes the treasury shares reissued during the period:



	Years Ended
	August 31,		August 31,		August 31,
	2021		2020		2019
Reissued treasury shares		96,400		234,370		63,130