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SHARE CAPITAL, OPTION PLANS AND SHARE-BASED PAYMENTS | 12 Months Ended
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Jun. 30, 2021
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 year ended June 30, 2021, pursuant to the Company’s dividend policy, we declared total non-cumulative dividends of $0.7770 per Common Share in the aggregate amount of $210.7 million, which we paid during the same period (year ended June 30, 2020 and 2019—$0.6984 and $0.6300 per Common Share, respectively, in the aggregate amount of $188.7 million and $168.9 million, respectively). 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 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 year ended June 30, 2021, we repurchased 1,455,088 of our Common Shares on the open market, at a cost of $64.8 million for potential reissuance under our LTIP or other plans, described below (year ended June 30, 2020 and 2019—300,000 and 726,059 Common Shares, respectively, at a cost of $12.4 million and $26.5 million, respectively). During the year ended June 30, 2021, we reissued 509,721 Common Shares from treasury stock in connection with the settlement of awards and other plans (year ended June 30, 2020 and 2019—480,574 and 613,524 Common Shares, respectively). Share Repurchase Plan On November 5, 2020, the Board authorized a share repurchase plan (Repurchase Plan), pursuant to which we may purchase in open market transactions, from time to time over the 12 month period commencing November 12, 2020, up to an aggregate of $350 million of our Common Shares. During the year ended June 30, 2021, we repurchased and cancelled 2,500,000 Common Shares for $119.1 million under the Repurchase Plan. Share-Based Payments Total share-based compensation expense for the periods indicated below is detailed as follows:
| Year Ended June 30,
| 2021 |  | 2020 |  | 2019
Stock options | $ | 15,639 |  |  | $ | 9,779 |  |  | $ | 10,232 |
Performance Share Units (issued under LTIP) | 9,898 |  |  | 5,997 |  |  | 3,461 |
Restricted Share Units (issued under LTIP) | 7,358 |  |  | 5,943 |  |  | 5,917 |
Restricted Share Units (other) | 10,561 |  |  | 174 |  |  | 175 |
Deferred Share Units (directors) | 3,396 |  |  | 3,345 |  |  | 3,133 |
Employee Stock Purchase Plan | 5,117 |  |  | 4,294 |  |  | 3,852 |
Total share-based compensation expense | $ | 51,969 |  |  | $ | 29,532 |  |  | $ | 26,770 |
Option Plans A summary of stock options outstanding under our 2004 Stock Option Plan is set forth below. All numbers shown in the chart below have been adjusted, where applicable, to account for the two-for-one stock splits that occurred on October 22, 2003, February 18, 2014 and January 24, 2017.
| 2004 Stock Option Plan
Date of inception | Oct-04
Eligibility | Eligible employees, as determined by the Board of Directors
Options granted to date | 38,348,857
Options exercised to date | (20,798,129)
Options cancelled to date | (9,437,154)
Options outstanding | 8,113,574
Termination grace periods | Immediately “for cause”; 90 days for any other reason; 180 days due to death
Vesting schedule | 25% per year, unless otherwise specified
Exercise price range | $22.68 - $48.74
Expiration dates | 8/1/2021 - 5/10/2028
Summary of Outstanding Stock Options The following table summarizes information regarding stock options outstanding at June 30, 2021:
|  |  |  | Options Outstanding |  | Options Exercisable
Range of Exercise Prices |  | Number of options Outstanding as of June 30, 2021 | Weighted Average Remaining Contractual Life (years) | Weighted Average Exercise Price |  | Number of options Exercisable as of June 30, 2021 | Weighted Average Exercise Price
$ | 22.68 |  | — | $ | 33.06 |  |  | 1,102,966 |  | 2.38 | $ | 30.61 |  |  | 943,933 |  | $ | 30.27 |
33.07 |  | — | 34.60 |  |  | 712,037 |  | 3.14 | 34.16 |  |  | 507,976 |  | 34.09 |
34.61 |  | — | 38.30 |  |  | 874,882 |  | 4.90 | 36.72 |  |  | 358,255 |  | 36.10 |
38.31 |  | — | 39.02 |  |  | 634,760 |  | 5.10 | 38.76 |  |  | 144,703 |  | 38.76 |
39.03 |  | — | 39.98 |  |  | 704,352 |  | 4.21 | 39.34 |  |  | 312,972 |  | 39.34 |
39.99 |  | — | 43.22 |  |  | 821,355 |  | 5.35 | 40.74 |  |  | 176,519 |  | 40.46 |
43.23 |  | — | 45.40 |  |  | 538,625 |  | 5.60 | 44.99 |  |  | 123,125 |  | 44.99 |
45.41 |  | — | 46.88 |  |  | 2,382,097 |  | 6.11 | 45.81 |  |  | — |  | — |
46.89 |  | — | 48.34 |  |  | 200,000 |  | 6.86 | 47.94 |  |  | — |  | — |
48.35 |  | — | 48.74 |  |  | 142,500 |  | 6.61 | 48.74 |  |  | — |  | — |
$ | 22.68 |  | — | $ | 48.74 |  |  | 8,113,574 |  | 4.88 | $ | 40.16 |  |  | 2,567,483 |  | $ | 34.83 |
As of June 30, 2021, an aggregate of 8,113,574 options to purchase Common Shares were outstanding and an additional 11,251,577 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 year ended June 30, 2021 and 2020 are as follows:
| Options |  | Weighted- Average Exercise Price |  | Weighted- Average Remaining Contractual Term (years) |  | Aggregate Intrinsic Value ($’000's)
Outstanding at June 30, 2020 | 7,429,537 |  |  | $ | 36.18 |  |  | 4.78 |  | $ | 49,574 |
Granted | 3,208,209 |  |  | 45.77 |  |  |  |  |
Exercised | (1,605,134) |  |  | 30.88 |  |  |  |  |
Forfeited or expired | (919,038) |  |  | 43.75 |  |  |  |  |
Outstanding at June 30, 2021 | 8,113,574 |  |  | $ | 40.16 |  |  | 4.88 |  | $ | 86,297 |
Exercisable at June 30, 2021 | 2,567,483 |  |  | $ | 34.83 |  |  | 3.47 |  | $ | 41,005 |
We estimate the fair value of stock options using the Black-Scholes option-pricing model or, where appropriate, the Monte Carlo pricing model, 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 estimated under the Black-Scholes option-pricing model were as follows:
| Year Ended June 30,
| 2021 |  | 2020 |  | 2019
Weighted–average fair value of options granted | $ | 8.45 |  |  | $ | 6.88 |  |  | $ | 8.39 |
Weighted-average assumptions used: |  |  |  |  |
Expected volatility | 26.26 | % |  | 22.63 | % |  | 25.72 | %
Risk–free interest rate | 0.24 | % |  | 1.30 | % |  | 2.57 | %
Expected dividend yield | 1.55 | % |  | 1.64 | % |  | 1.54 | %
Expected life (in years) | 4.59 |  | 4.12 |  | 4.44
Forfeiture rate (based on historical rates) | 7 | % |  | 7 | % |  | 6 | %
Average exercise share price | $ | 45.76 |  |  | $ | 41.81 |  |  | $ | 38.81 |
For the periods in which performance options were granted, as indicated, the weighted-average fair value of performance options and weighted-average assumptions estimated under the Monte Carlo pricing model were as follows:
| Year Ended June 30,
| 2021
Weighted–average fair value of options granted | $ | 10.18 |
Derived service period (in years) | 1.80
Weighted-average assumptions used: |
Expected volatility | 28.00 | %
Risk–free interest rate | 0.42 | %
Expected dividend yield | 1.70 | %
Average exercise share price | $ | 45.81 |
During the year ended June 30, 2021, we granted 750,000 performance options, which are included in the summary of stock option plan activity above. There were no performance options granted during the year ended June 30, 2020 and 2019, respectively. As of June 30, 2021, the total compensation cost related to the unvested stock option awards not yet recognized was $38.7 million, which will be recognized over a weighted-average period of 2.8 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 not capitalized any share-based compensation costs as part of the cost of an asset in any of the periods presented. The aggregate intrinsic value of options exercised during the year ended June 30, 2021 was $25.0 million (year ended June 30, 2020 and 2019—$26.6 million and $21.0 million, respectively). For the year ended June 30, 2021, cash in the amount of $49.6 million was received as the result of the exercise of options granted under share-based payment arrangements (year ended June 30, 2020 and 2019—$41.3 million and $35.6 million, respectively). The tax benefit realized by us during the year ended June 30, 2021 from the exercise of options eligible for a tax deduction was $2.3 million (year ended June 30, 2020 and 2019—$1.9 million and $2.9 million, respectively). 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. 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. Stock options granted under the LTIPs have been measured using the Black-Scholes option-pricing model, consistent with Topic 718. As of June 30, 2021, the total expected compensation cost related to the unvested LTIP awards not yet recognized was $28.8 million, which is expected to be recognized over a weighted average period of 1.8 years. LTIP grants that have recently vested, or have yet to vest, are described below. LTIP grants are referred to in this Annual Report on Form 10-K based upon the year in which the grants are expected to vest. LTIP 2020 Grants made in Fiscal 2018 under the LTIP (collectively referred to as LTIP 2020), consisting of PSUs and RSUs, took effect in Fiscal 2018 starting on August 7, 2017. We settled the LTIP 2020 awards by issuing 292,401 Common Shares from treasury stock during the second quarter of Fiscal 2021, with a cost of $11.2 million. LTIP 2021 Grants made in Fiscal 2019 under the LTIP (collectively referred to as LTIP 2021), 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 LTIP 2021. We expect to settle the LTIP 2021 awards in stock. LTIP 2022 Grants made in Fiscal 2020 under the LTIP (collectively referred to as LTIP 2022), 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 LTIP 2022. We expect to settle the LTIP 2022 awards in stock. LTIP 2023 Grants made in Fiscal 2021 under the LTIP (collectively referred to as LTIP 2023), consisting of PSUs and RSUs, took effect in Fiscal 2021 starting on August 10, 2020. 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 LTIP 2023. We expect to settle the LTIP 2023 awards in stock. Restricted Share Units (RSUs) During the year ended June 30, 2021, we granted 484,956 RSUs to employees in accordance with employment and other non-LTIP related agreements (year ended June 30, 2020 and 2019—15,000 RSUs and nil, respectively). RSUs vest over a specified contract date, typically three years from the respective date of grants. As of June 30, 2021, the total expected compensation cost related to the unvested RSU awards not yet recognized was $9.0 million, which is expected to be recognized over a weighted average period of 2.1 years. We expect to settle RSU awards in stock. During the year ended June 30, 2021, we did not issue any Common Shares from treasury stock in connection with the settlement of vested RSUs (year ended June 30, 2020 and 2019—3,334 and 22,627 Common Shares, respectively, with a cost of $0.1 million and $0.7 million, respectively). Deferred Share Units (DSUs) During the year ended June 30, 2021, we granted 85,428 DSUs, respectively, to certain non-employee directors (year ended June 30, 2020 and 2019—82,733 and 100,271 DSUs, respectively). 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. During the year ended June 30, 2021, we issued 23,640 Common Shares from treasury stock, at a cost of $1.1 million, in connection with the settlement of vested DSUs (year ended June 30, 2020 and 2019—nil and 51,794 Common Shares, respectively, with a cost of nil and $2.0 million respectively). Employee Stock Purchase Plan (ESPP) Our ESPP offers employees a purchase price discount of 15%. During the year ended June 30, 2021, 769,031 Common Shares were eligible for issuance to employees enrolled in the ESPP (year ended June 30, 2020 and 2019—742,961 and 696,091 Common Shares, respectively). During the year ended June 30, 2021, cash in the amount of $30.5 million was received from employees relating to the ESPP (year ended June 30, 2020 and 2019 —$25.3 million and $22.2 million, respectively).

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- 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
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