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Note 11 - Stock-based Compensation
 3 Months Ended
Nov. 30, 2024
Notes to Financial Statements  
Share-Based Payment Arrangement [Text Block]

11.

STOCK-BASED COMPENSATION

 

Stock Options

 

A summary of stock option activities under the Northern Technologies International Corporation 2024 Stock Incentive Plan (2024 Plan), the Northern Technologies International Corporation Amended and Restated 2019 Stock Incentive Plan and the Northern Technologies International Corporation Amended and Restated 2007 Stock Incentive Plan is as follows:

 

   

Number of
Options
Outstanding

    

Weighted
Average Exercise
Price

  

Outstanding as of August 31, 2024

     1,752,667     $ 11.48  

Granted

     245,190     $ 13.26  

Exercised

     —       —  

Cancelled/Forfeited

     —       —  

Outstanding as of November 30, 2024

     1,997,857     $ 11.69  

 

The weighted average per share fair value of options granted during the three months ended November 30, 2024 and 2023 was $4.95 and $5.05, respectively. The weighted average remaining contractual life of the options outstanding as of November 30, 2024 and 2023 was 6.27 years and 6.55 years, respectively.

 

The Company recognized stock option compensation expense of $304,930 and $350,933 during the three months ended November 30, 2024 and 2023, respectively. As of November 30, 2024, there was $1,916,887 of unrecognized stock option compensation expense. The amount is expected to be recognized over a period of 2.75 years.

 

Restricted Stock Units

 

Restricted stock units were granted under the 2024 Plan on September 1, 2024 to certain non-employee directors during the three months ended November 30, 2024 and vest in full on the one-year anniversary of the date of grant. A summary of restricted stock unit activity for the three months ended November 30, 2024 is as follows:

 

   

Number of
Restricted Stock
Units

    

Weighted
Average Grant
Date Fair Value

  

Outstanding as of August 31, 2024

     —     $ —  

Granted

     11,313       13.14  

Vested/Settled

     —       —  

Cancelled/Forfeited

     —       —  

Outstanding as of November 30, 2024

     11,313     $ 13.14  

 

Restricted stock units are valued using the closing stock price on the grant date. The Company recognizes the grant date fair value of the restricted stock units over one year. For the three months ended November 30, 2024, the Company recognized $36,960 in stock-based compensation expense. As of November 30, 2024, there is an unrecognized stock-based compensation expense of $111,692, which is expected to be recognized over 0.75 years.