Note 12 - Stock-based Compensation

12 Months Ended

Dec. 31, 2018

Notes to Financial Statements

Disclosure of Compensation Related Costs, Share-based Payments [Text Block]

12. Stock-based compensation

The Company has a stock option plan for certain officers and key full-time employees of the Company and its subsidiaries. Options are granted at the market price for the underlying shares on the date of grant. Each option vests over a

four

-year term, expires

five

years from the date granted and allows for the purchase of

one

Subordinate Voting Share. All Subordinate Voting Shares issued are new shares. As at

December 31, 2018,

there were

1,127,500

options available for future grants.

Grants under the Company’s stock option plan are equity-classified awards. Stock option activity for the year ended

December 31, 2018

is follows:

	Number of options			Weighted average exercise price		Weighted average remaining contractual life (years)		Aggregate intrinsic value
Shares issuable under options - Beginning of period		1,396,750		$	34.41
Granted		430,500			66.39
Exercised		(194,100	)		18.96
Shares issuable under options - December 31, 2018		1,633,150		$	44.68		2.5	$	38,889
Options exercisable - End of period		667,977		$	33.01		1.6	$	23,693

The Company incurred stock-based compensation expense related to these awards of

$5,767

during the year ended

December 31, 2018 (

2017

-

$4,132

).

As at

December 31, 2018,

the range of option exercise prices was

$20.52

to

$70.40

per share. Also as at

December 31, 2018,

the aggregate intrinsic value and weighted average remaining contractual life for in-the-money options vested and expected to vest were

$38,889

and

2.5

years, respectively.

The following table summarizes information about option exercises during year ended

December 31, 2018:

	2018
Number of options exercised		194,100
Aggregate fair value	$	6,382
Intrinsic value		5,083
Amount of cash received		1,299
Tax benefit recognized	$	2,440

As at

December 31, 2018,

there was

$6,703

of unrecognized compensation cost related to non-vested awards which is expected to be recognized over the next

4

years. During the year ended

December 31, 2018,

the fair value of options vested was

$11,670

(

2017

-

$11,363

).

The fair value of each option grant is estimated on the date of grant using the Black-Scholes option pricing model, utilizing the following weighted average assumptions:

	2018
Risk free rate		2.2	%
Expected life in years		4.75
Expected volatility		30.5	%
Dividend yield		0.7	%
Weighted average fair value per option granted	$	17.91

The risk-free interest rate is based on the implied yield of a

zero

-coupon US Treasury bond with a term equal to the option’s expected term. The expected life in years represents the estimated period of time until exercise and is based on historical experience. The expected volatility is based on the historical prices of the Company’s shares over the previous

four

years.