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11. Employee Stock Ownership Plan ("esop")
 6 Months Ended
Feb. 28, 2013
Notes  
11. Employee Stock Ownership Plan ("esop")

11.          EMPLOYEE STOCK OWNERSHIP PLAN (“ESOP”)

 

The Company sponsors an ESOP that covers all U.S. employees who are employed by the Company on August 31 of each year and who have at least one thousand hours with the Company in the twelve months preceding that date.  The ESOP formerly held common shares of the Company and granted to participants in the plan certain ownership rights in, but not possession of, or voting control of, any common stock of the Company held by the Trustee of the Plan.  Shares of common stock were allocated annually to participants in the ESOP pursuant to a prescribed formula. The Company records compensation expense based on the market price of the Company's shares when they were allocated.  Any dividends on allocated ESOP shares are recorded as a reduction of retained earnings.  Beginning in fiscal 2010, the ESOP began its investment in diversified mutual funds. During fiscal 2011 and 2012, all of the Company’s shares held by the ESOP were sold, with the majority repurchased by the Company and cancelled under the 10b5-1 share repurchase plans.  Effective June 30, 2012, the ESOP has been terminated, subject to the approval of the Internal Revenue Service.  No further contributions shall be made to the ESOP.  Upon receipt of approval from the Internal Revenue Service, the remaining assets shall be distributed to the participants pursuant to the terms of the Plan.

 

ESOP compensation expense was $Nil for the six month period ended February 28, 2013 and for the fiscal year ended August 31, 2012, and is included in wages and employee benefits.  The ESOP shares are as follows:

 

 

 

February 28, 2013

August 31, 2012

 

 

 

Shares owned by ESOP

0

0