XML 28 R22.htm IDEA: XBRL DOCUMENT
v3.19.3

Share Capital, Option Plans and Share-Based Payments | 3 Months Ended
--- | ---
Sep. 30, 2019
Share-based Payment Arrangement [Abstract] |
SHARE CAPITAL, OPTION PLANS AND SHARE-BASED PAYMENTS | SHARE CAPITAL, OPTION PLANS AND SHARE-BASED PAYMENTS Cash Dividends For the three months ended September 30, 2019, pursuant to the Company’s dividend policy, we declared total non-cumulative dividends of $0.1746 per Common Share in the aggregate amount of $47.0 million, which we paid during the same period. For the three months ended September 30, 2018, pursuant to the Company’s dividend policy, we paid total non-cumulative dividends of $0.1518 per Common Share in the aggregate amount of $40.5 million. Share Capital Our authorized share capital includes an unlimited number of Common Shares and an unlimited number of Preference Shares. No Preference Shares have been issued. Treasury Stock Repurchase From time to time we may provide funds to an independent agent to facilitate repurchases of our Common Shares in connection with the settlement of awards under the Long-Term Incentive Plans (LTIP) or other plans. During the three months ended September 30, 2019, we repurchased 300,000 of our Common Shares in the open market, at a cost of approximately $12.4 million for potential reissuance under our LTIP or other plans (three months ended September 30, 2018—304,000 Common Shares at a cost of $11.7 million). See below for more details on our various plans. Reissuance During the three months ended September 30, 2019, we did no t reissue any Common Shares from treasury stock (three months ended September 30, 2018—2,968 Common Shares), in connection with the settlement of awards. Share-Based Payments Total share-based compensation expense for the periods indicated below is detailed as follows:
| Three Months Ended September 30,
| 2019 |  | 2018
Stock options | $ | 2,010 |  |  | $ | 2,602 |
Performance Share Units (issued under LTIP) | 1,400 |  |  | 843 |
Restricted Share Units (issued under LTIP) | 1,660 |  |  | 1,385 |
Restricted Share Units (other) | 10 |  |  | 81 |
Deferred Share Units (directors) | 751 |  |  | 661 |
Employee Share Purchase Plan | 1,060 |  |  | 983 |
Total share-based compensation expense | $ | 6,891 |  |  | $ | 6,555 |
Summary of Outstanding Stock Options As of September 30, 2019, an aggregate of 7,588,389 options to purchase Common Shares were outstanding and an additional 8,728,163 options to purchase Common Shares were available for issuance under our stock option plans. Our stock options generally vest over four years and expire between seven and ten years from the date of the grant. Currently we also have options outstanding that vest over five years, as well as options outstanding that vest based on meeting certain market conditions. The exercise price of all our options is set at an amount that is not less than the closing price of our Common Shares on the NASDAQ on the trading day immediately preceding the applicable grant date. A summary of activity under our stock option plans for the three months ended September 30, 2019 is as follows:
| Options |  | Weighted- Average Exercise Price |  | Weighted- Average Remaining Contractual Term (years) |  | Aggregate Intrinsic Value ($’000s)
Outstanding at June 30, 2019 | 7,102,753 |  |  | $ | 31.82 |  |  |  |  |
Granted | 745,710 |  |  | 38.76 |  |  |  |  |
Exercised | (183,680 | ) |  | 24.91 |  |  |  |  |
Forfeited or expired | (76,394 | ) |  | 34.19 |  |  |  |  |
Outstanding at September 30, 2019 | 7,588,389 |  |  | $ | 32.64 |  |  | 4.17 |  | $ | 61,988 |
Exercisable at September 30, 2019 | 2,936,341 |  |  | $ | 28.37 |  |  | 2.78 |  | $ | 36,520 |
We estimate the fair value of stock options using the Black-Scholes option-pricing model or, where appropriate, the Monte Carlo Valuation Method, consistent with the provisions of ASC Topic 718, "Compensation—Stock Compensation" (Topic 718) and SEC Staff Accounting Bulletin No. 107. The option-pricing models require input of subjective assumptions, including the estimated life of the option and the expected volatility of the underlying stock over the estimated life of the option. We use historical volatility as a basis for projecting the expected volatility of the underlying stock and estimate the expected life of our stock options based upon historical data. We believe that the valuation techniques and the approach utilized to develop the underlying assumptions are appropriate in calculating the fair value of our stock option grants. Estimates of fair value are not intended, however, to predict actual future events or the value ultimately realized by employees who receive equity awards. For the periods indicated, the weighted-average fair value of options and weighted-average assumptions were as follows:
| Three Months Ended September 30,
| 2019 |  | 2018
Weighted–average fair value of options granted | $ | 6.41 |  |  | $ | 8.73 |
Weighted-average assumptions used: |  |  |
Expected volatility | 22.11 | % |  | 26.07 | %
Risk–free interest rate | 1.68 | % |  | 2.80 | %
Expected dividend yield | 1.68 | % |  | 1.45 | %
Expected life (in years) | 4.11 |  |  | 4.32 |
Forfeiture rate (based on historical rates) | 7 | % |  | 6 | %
Average exercise share price | $ | 38.76 |  |  | $ | 39.27 |
As of September 30, 2019, the total compensation cost related to the unvested stock option awards not yet recognized was approximately $25.8 million, which will be recognized over a weighted-average period of approximately 3.0 years. No cash was used by us to settle equity instruments granted under share-based compensation arrangements in any of the periods presented. We have no t capitalized any share-based compensation costs as part of the cost of an asset in any of the periods presented. For the three months ended September 30, 2019, cash in the amount of $4.6 million was received as the result of the exercise of options granted under share-based payment arrangements. The tax benefit realized by us during the three months ended September 30, 2019 from the exercise of options eligible for a tax deduction was $0.3 million. For the three months ended September 30, 2018, cash in the amount of $12.4 million was received as the result of the exercise of options granted under share-based payment arrangements. The tax benefit realized by us during the three months ended September 30, 2018 from the exercise of options eligible for a tax deduction was $0.9 million. Long-Term Incentive Plans We incentivize certain eligible employees, in part, with long-term compensation pursuant to our LTIP. The LTIP is a rolling three year program that grants eligible employees a certain number of target Performance Share Units (PSUs) and/or Restricted Share Units (RSUs). Target PSUs become vested upon the achievement of certain financial and/or operational performance criteria (the Performance Conditions) that are determined at the time of the grant. Target RSUs become vested when an eligible employee remains employed throughout the vesting period. PSUs and RSUs granted under the LTIPs have been measured at fair value as of the effective date, consistent with Topic 718, and will be charged to share-based compensation expense over the remaining life of the plan. Stock options granted under the LTIPs have been measured using the Black-Scholes option-pricing model, consistent with Topic 718. We estimate the fair value of PSUs using the Monte Carlo pricing model and RSUs have been valued based upon their grant date fair value. As of September 30, 2019, the total expected compensation cost related to the unvested LTIP awards not yet recognized was $27.1 million, which is expected to be recognized over a weighted average period of 2.3 years. LTIP grants that have recently vested, or have yet to vest, are described below. LTIP grants are referred to in this Quarterly Report on Form 10-Q based upon the year in which the grants are expected to vest. Fiscal 2019 LTIP Grants made in Fiscal 2017 under the LTIP (collectively referred to as Fiscal 2019 LTIP), consisting of PSUs and RSUs, took effect in Fiscal 2017 starting on August 14, 2016. The Performance Conditions for vesting of the PSUs are based solely upon market conditions. The RSUs are employee service-based awards and vest over the life of the Fiscal 2019 LTIP. We expect to settle the Fiscal 2019 LTIP awards in stock during the second quarter of Fiscal 2020. Fiscal 2020 LTIP Grants made in Fiscal 2018 under the LTIP (collectively referred to as Fiscal 2020 LTIP), consisting of PSUs and RSUs, took effect in Fiscal 2018 starting on August 7, 2017. The Performance Conditions for vesting of the PSUs are based solely upon market conditions. The RSUs are employee service-based awards and vest over the life of the Fiscal 2020 LTIP. We expect to settle the Fiscal 2020 LTIP awards in stock. Fiscal 2021 LTIP Grants made in Fiscal 2019 under the LTIP (collectively referred to as Fiscal 2021 LTIP), consisting of PSUs and RSUs, took effect in Fiscal 2019 starting on August 6, 2018. The Performance Conditions for vesting of the PSUs are based solely upon market conditions. The RSUs are employee service-based awards and vest over the life of the Fiscal 2021 LTIP. We expect to settle the Fiscal 2021 LTIP awards in stock. Fiscal 2022 LTIP Grants made in Fiscal 2020 under the LTIP (collectively referred to as Fiscal 2022 LTIP), consisting of PSUs and RSUs, took effect in Fiscal 2020 starting on August 5, 2019. The Performance Conditions for vesting of the PSUs are based solely upon market conditions. The RSUs are employee service-based awards and vest over the life of the Fiscal 2022 LTIP. We expect to settle the Fiscal 2022 LTIP awards in stock. Restricted Share Units (RSUs) During the three months ended September 30, 2019, we did no t grant any RSUs to employees in accordance with employment and other non-LTIP related agreements (three months ended September 30, 2018—nil). The RSUs vest over a specified contract date, typically three years from the respective date of grants. We expect to settle the awards in stock. During the three months ended September 30, 2019, we did no t issue any Common Shares from treasury stock in connection with the settlement of vested RSUs (three months ended September 30, 2018—2,968 Common Shares with a cost of $0.1 million). Deferred Stock Units (DSUs) During the three months ended September 30, 2019, we granted 3,799 DSUs to certain non-employee directors (three months ended September 30, 2018—3,158 DSUs). The DSUs were issued under our Deferred Share Unit Plan. DSUs granted as compensation for director fees vest immediately, whereas all other DSUs granted vest at our next annual general meeting following the granting of the DSUs. No DSUs are payable by us until the director ceases to be a member of the Board. Employee Share Purchase Plan (ESPP) Our ESPP offers employees a purchase price discount of 15%. During the three months ended September 30, 2019, 188,081 Common Shares were eligible for issuance to employees enrolled in the ESPP (three months ended September 30, 2018—176,074 Common Shares). During the three months ended September 30, 2019, cash in the amount of approximately $6.5 million was received from employees relating to the ESPP (three months ended September 30, 2018—$5.7 million).

X
- References No definition available. + Details
Name: | us-gaap_DisclosureOfCompensationRelatedCostsSharebasedPaymentsAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for shareholders' equity and share-based payment arrangement. Includes, but is not limited to, disclosure of policy and terms of share-based payment arrangement, deferred compensation arrangement, and employee stock purchase plan (ESPP). + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -URI http://asc.fasb.org/topic&trid=2208762 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 718 -URI http://asc.fasb.org/topic&trid=2228938 + Details
Name: | us-gaap_ShareholdersEquityAndShareBasedPaymentsTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration