Stockholders' Equity

12 Months Ended

Aug. 31, 2012

Stockholders' Equity

Note 8 — Stockholders’ Equity

Common Stock

	Year Ended August 31,
	2012		2011		2010
Common shares outstanding
Balance, beginning of year		13,243,385		13,189,581		13,157,387
Series B preferred stock converted to common shares		1,000,000		—		—
Issuance of restricted stock, net		37,333		53,804		32,194
Balance, end of year		14,280,718		13,243,385		13,189,581

Preferred Stock, Series B

On April 7, 2010, the Company issued $40 million of Series A 15% cumulative non-voting, non-convertible preferred stock (“Series A Preferred Stock”) and 100,000 shares of Series B voting convertible preferred stock (“Series B Preferred Stock”) in a private placement to Zell Credit Opportunities Master Fund, L.P., an investment fund managed by Equity Group Investments, a private investment firm (the “Investor”). See Note 6 for further details. Series B Preferred Stock was recorded at its relative fair value of $7.7 million at the time of issuance and recorded as equity. The outstanding Series B Preferred Stock was convertible into shares of the Company’s common stock at a conversion rate of ten shares of common stock per one share of Series B Preferred Stock. The holders of the Series B Preferred Stock had the right to one vote for each share of common stock into which the Series B Preferred Stock was convertible.

During the third quarter of fiscal 2012, the Investor converted its 100,000 shares of Series B Preferred Stock into 1,000,000 shares of the Company’s common stock.