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SHARE-BASED PAYMENTS

12 Months Ended

Dec. 31, 2022

15.

SHARE-BASED PAYMENTS

Share-based compensation expense recorded during the years ended December 31, 2022 and 2021 was as follows:


	Years ended December 31,
	2022		2021
Share option plan expense (i)	$	0.1	$	0.3
Restricted share unit plan expense, including restricted performance shares (ii)		13.2		19.2
Deferred share units expense (iii)		1.4		1.4
Employer portion of employee share purchase plan (iv)		2.5		2.8
Total share-based compensation expense	$	17.2	$	23.7

(i)	Share option plan

The Company has a share option plan for officers, employees, and contractors enabling them to purchase common shares. Under the share option plan, the aggregate number of shares reserved for issuance may not exceed 31.2 million common shares. Additionally, the aggregate number of Common Shares reserved for issuance under the share option plan to insiders, at any one time upon the exercise of Options and pursuant to all other compensation arrangements of the Company shall not exceed 10% of the total number of Common Shares then outstanding. Each option granted under the plan is for a maximum term of seven years. One-third of the options granted are exercisable each year commencing one year after the date of grant. The exercise price is determined by the Company’s Board of Directors at the time the option is granted, and may not be less than the closing market price of the common shares on the last trading day prior to the grant date of the option. The share options outstanding as at December 31, 2022 expire at various dates through 2026. The number of common shares available for the granting of options as at December 31, 2022 was 15.8 million.

The following table summarizes the status of the share option plan and changes during the years ended December 31, 2022 and 2021:


	2022			2021
		Weighted average			Weighted average
	Number of options	exercise price		Number of options	exercise price
	(000’s)	(C$/option)		(000’s)	(C$/option)
Balance at January 1	3,764	$	4.47	5,601	$	4.68
Issued on acquisition of Great Bear^(a)	9,880		1.93	—		—
Exercised	(6,368)		2.36	(1,624)		5.13
Forfeited	—		—	(213)		4.97
Expired	(90)		4.69	—		—
Outstanding at end of period	7,186	$	2.84	3,764	$	4.47
Exercisable at end of period	7,186	$	2.84	3,273	$	4.47

(a)

See Note 6i for details of the options issued on acquisition of Great Bear.

For the year ended December 31, 2022, the weighted average share price at the date of exercise was C$6.89 (December 31, 2021 - C$8.56).

The following table summarizes information about the stock options outstanding and exercisable as at December 31, 2022:


			Options outstanding and exercisable
					Weighted
				Weighted	average
			Number of	average	remaining
			options	exercise price	contractual life
Exercise price range in C$:			(000’s)	(C$)	(years)
	0.10	0.32	1,051	0.13	0.15
	0.33	1.17	1,523	0.58	0.15
	1.18	4.20	1,749	3.44	0.16
	4.21	4.77	1,653	4.43	1.59
	4.78	5.06	1,210	4.99	1.70
			7,186	2.84	0.74

The following weighted average assumptions were used in computing the fair value of stock options using the Black-Scholes option pricing model granted during the year ended December 31, 2022:


Weighted average share price (C$)	$	7.01
Expected dividend yield		2.8	%
Expected volatility		36.3	%
Risk-free interest rate		2.5	%
Expected option life (in years)		1.0
Weighted average fair value per stock option granted (C$)	$	5.09

The expected volatility used in the Black-Scholes option pricing model is based primarily on the historical volatility of the Company’s shares.

(ii)	Restricted share plans

The Company has a Restricted Share Plan and a Restricted Share Unit Plan (Cash-Settled) whereby RSUs and RPSUs may be granted to employees, officers and contractors of the Company. Under the Restricted Share Plan, the aggregate number of shares reserved for issuance may not exceed 50 million common shares. The number of common shares available for the granting of restricted shares under this plan as at December 31, 2022 was 19.8 million.

(a)	Restricted share units

RSUs are generally exercisable into one common share entitling the holder to acquire the common share for no additional consideration. RSUs vest over a three year period.

The following table summarizes information about all RSUs and related changes during the years ended December 31, 2022 and 2021:


	2022			2021
		Weighted average			Weighted average
	Number of units	fair value		Number of units	fair value
	(000’s)	(C$/unit)		(000’s)	(C$/unit)
Balance at January 1	5,293	$	7.81	6,475	$	5.86
Granted	3,928		6.85	3,017		8.80
Reinvested	170		7.50	175		6.82
Redeemed	(2,871)		7.18	(3,748)		5.36
Forfeited	(1,615)		7.68	(626)		6.84
Outstanding at end of period	4,905	$	7.44	5,293	$	7.81

As at December 31, 2022, the Company had recognized a liability of $6.1 million (December 31, 2021 - $10.6 million) within employee related accrued liabilities (see Note 7viii) in respect of its cash-settled RSUs.

(b)	Restricted performance share units

The RPSUs are subject to certain vesting requirements and vest at the end of three years. The vesting requirements are based on certain performance criteria over the vesting period established by the Company.

The following table summarizes information about the RPSUs and related changes during the years ended December 31, 2022 and 2021:


	2022			2021
		Weighted average			Weighted average
	Number of units	fair value		Number of units	fair value
	(000’s)	(C$/unit)		(000’s)	(C$/unit)
Balance at January 1	3,781	$	7.25	4,459	$	5.95
Granted	1,638		6.53	1,378		8.37
Reinvested	110		7.57	77		6.90
Redeemed	(1,319)		4.74	(1,739)		4.92
Forfeited	(816)		6.54	(394)		6.66
Outstanding at end of period	3,394	$	8.06	3,781	$	7.25

(iii)

Deferred share unit plan

The Company has a DSU plan for its outside directors which provides that each outside director receives, on the last date in each quarter a number of DSUs having a value equal to a minimum of 50% of the compensation of the outside director for the current quarter. Each outside director can elect to receive a greater percentage of their compensation in DSUs. The number of DSUs granted to an outside director is based on the closing price of the Company’s common shares on the TSX on the business day immediately preceding the DSU issue date. At such time as an outside director ceases to be a director, the Company will make a cash payment on the outstanding DSUs to the outside director in accordance with the redemption election made by the departing director or in the absence of an election to defer redemption, in accordance with the default redemption provisions provided in the Deferred Share Unit Plan.

The number of DSUs granted by the Company and the weighted average fair value per unit issued for the years ended December 31, 2022 and 2021 are as follows:


	Years ended December 31,
	2022		2021
DSUs granted (000’s)		329		234
Weighted average grant-date fair value (C$/ unit)	$	5.47	$	7.55

There were 1,625,785 DSUs outstanding, for which the Company had recognized a liability of $6.6 million, as at December 31, 2022 (December 31, 2021 - $7.5 million), within employee related accrued liabilities (see Note 7viii).

(iv)	Employee share purchase plan

The Company has an employee SPP whereby certain employees of the Company have the opportunity to contribute up to a maximum of 10% of their annual base salary to purchase common shares. Since 2004, the Company has made contributions equal to 50% of the employees’ contributions.

The compensation expense related to the employee SPP for the year ended December 31, 2022 was $2.5 million (year ended December 31, 2021 - $2.8 million).