XML 44 R23.htm IDEA: XBRL DOCUMENT

Stock-Based Compensation

9 Months Ended

Sep. 30, 2022

16. Stock-Based Compensation

The Company’s compensation program comprises three main elements: base salary, an annual short-term incentive plan (“STIP”) cash award, and long-term equity-based incentive compensation (“LTIP”) in the form of performance share units (“PSUs”), restricted stock units (“RSUs”), stock options, and deferred stock units (“DSUs”).

The Gold Resource Corporation 2016 Equity Incentive Plan (the “Incentive Plan”) allows for the issuance of up to 5 million shares of common stock in the form of incentive and non-qualified stock options, stock appreciation rights, RSUs, stock grants, stock units, performance shares, performance share units, and performance cash. Additionally, pursuant to the terms of the Incentive Plan, any award outstanding under the prior plan that is terminated, expired, forfeited, or canceled for any reason, will be available for grant under the Incentive Plan.

Effective January 1, 2021, the Company’s Board of Directors, on the recommendation of the Compensation Committee, implemented a program to issue DSUs. DSUs are qualifying instruments under the terms of the Company’s Incentive Plan and therefore do not require additional shareholder approval. The vesting and settlement terms of the DSUs are determined by the Compensation Committee at the time the DSUs are awarded.

DSUs of nil and 214,357 were granted to the Board of Directors during the three and nine months ended September 30, 2022, respectively. DSUs of nil and 130,000 were granted to the Board of Directors during the three and nine months ended September 30, 2021, respectively. DSUs are redeemable in cash or shares at the earlier of 10 years or upon the eligible directors’ termination. Termination is deemed to occur on the earliest of (1) the date of voluntary resignation or retirement of the director from the Board; (2) the date of death of the director; or (3) the date of removal of the director from the Board whether by shareholder resolution, failure to achieve re-election, or otherwise; and on which date the director is not a director or employee of the Company or any of its affiliates. These awards contain a cash settlement feature and are therefore classified as a liability and are marked to fair value each reporting period. The Company may also issue DSUs for directors in lieu of board fees at their request. During the three and nine months ended September 30, 2022, respectively, there were 3,746 and 10,454 DSUs granted in lieu of board fees that are also subject to mark-to-market adjustment. Both during the three and nine months ended September 30, 2021, respectively, there were 1,960 DSUs granted in lieu of board fees that are also subject to mark-to-market adjustment. As of September 30, 2022 and 2021, the liability balance related to DSUs was $0.6 million and $0.2 million, respectively.

RSUs of nil and 611,681 were granted during the three and nine months ended September 30, 2022, respectively. No RSUs were granted during the three and nine months ended September 30, 2021. During the three and nine months ended September 30, 2022, a total of 41,666 and 119,467 RSUs vested, respectively, from which 41,666 and 80,169 RSUs were redeemed, respectively, issuing 41,666 and 75,584 common shares with an intrinsic value and a fair value of $74,165 and $138,101, respectively. During the three and nine months ended September 30, 2021, respectively, a total of 50,183 and 52,797 RSUs vested and redeemed, and 49,755 and 52,369 common shares were issued with an intrinsic value and a fair value of $0.1 million and $0.1 million, respectively.

Stock options of nil and 320,816 were granted during the three and nine months ended September 30, 2022, respectively. Stock options of nil and 600,000 were granted during the three and nine months ended September 30, 2021, respectively. Stock options of nil and 355,000, respectively, were exercised during the three and nine months ended September 30, 2022. These exercises were settled in cash. No stock options were exercised during the three months ended September 30, 2021. During the nine months ended September 30, 2021, stock options to purchase an aggregate of 217,718 shares of the Company’s common stock were exercised at a weighted average exercise price of $1.31 per share.

PSUs of nil and 695,041 were granted during the three and nine months ended September 30, 2022, respectively. No PSUs were granted during the three and nine months ended September 30, 2021. PSUs cliff vest usually in three years based on the relative total shareholder return of a predetermined peer group and are expected to be settled in cash.

Stock-based compensation expense for the periods presented is as follows:


	For the three months ended September 30,				For the nine months ended September 30,
	2022		2021		2022		2021

	(in thousands)				(in thousands)
Stock options	$	124	$	74	$	523	$	436
Restricted stock units		161		87		465		71
Performance stock units		152		-		246		-
Deferred stock units		13		(131)		383		204
Total	$	450	$	30	$	1,617	$	711

The Company has a short-term incentive plan (“STIP”) for its management team that provides annual cash payable upon achievement of specified performance metrics. As of September 30, 2022, we accrued $0.7 million payable in cash related to the 2022 STIP program.