The authorized capital stock of Teekay at December 31, 2020, 2019, and 2018, was 25 million shares of Preferred Stock, with a par value of $1 per share, and 725 million shares of Common Stock, with a par value of $0.001 per share. As at December 31, 2020, 101,108,886 shares of Common Stock (2019 – 100,784,422) were issued and outstanding and no shares of Preferred Stock issued.

In December 2020, Teekay filed a continuous offering program (or COP) under which Teekay may issue shares of its common stock, at market prices up to a maximum aggregate amount of $65.0 million. As of the date of filing this Annual Report, no shares of common stock have been issued under this COP.

During 2018, Teekay completed a public offering of 10.0 million common shares priced at $9.75 per share, raising net proceeds of approximately $93.0 million and issued 1.1 million shares of common stock as part of a COP initiated in 2016 generating net proceeds of $10.7 million.

Dividends may be declared and paid out of surplus, but if there is no surplus, dividends may be declared or paid out of the net profits for the fiscal year in which the dividend is declared and for the preceding fiscal year. Surplus is the excess of the net assets of the Company over the aggregated par value of the issued shares of the Teekay. Subject to preferences that may apply to any shares of preferred stock outstanding at the time, the holders of common stock are entitled to share equally in any dividends that the Board of Directors may declare from time to time out of funds legally available for dividends.

In March 2013, the Company adopted the 2013 Equity Incentive Plan (or the 2013 Plan) and suspended the 1995 Stock Option Plan and the 2003 Equity Incentive Plan (collectively referred to as the Plans). As at December 31, 2020, the Company had reserved 5,581,663 (2019 – 5,606,429) shares of Common Stock pursuant to the 2013 Plan, for issuance upon the exercise of options or equity awards granted or to be granted.

During 2020, no stock options were granted by the Company. During the years ended December 31, 2019 and 2018, the Company granted options under the 2013 Plan to acquire up to 2,620,582 and 1,048,916 shares of Common Stock, respectively, to certain eligible officers, employees and directors of the Company. The options under the Plans have ten-year terms and vest equally over three years from the grant date. All options outstanding as of December 31, 2020, expire between March 8, 2021 and March 14, 2029, ten years after the date of each respective grant.


	December 31, 2020		December 31, 2019		December 31, 2018
	Options (000’s) #	Weighted-Average Exercise Price $	Options (000’s) #	Weighted-Average Exercise Price $	Options (000’s) #	Weighted-Average Exercise Price $
Outstanding – beginning of year	6,066	10.77	3,754	15.54	3,600	22.96
Granted	—	—	2,620	3.98	1,052	8.67
Exercised	—	—	—	—	(2)	9.44
Forfeited / expired	(491)	19.35	(308)	11.07	(896)	37.44
Outstanding – end of year	5,575	10.02	6,066	10.77	3,754	15.54
Exercisable – end of year	3,490	13.17	2,565	18.25	1,954	21.35


	December 31, 2020		December 31, 2019		December 31, 2018
	Options (000’s) #	Weighted-Average Grant Date Fair Value $	Options (000’s) #	Weighted-Average Grant Date Fair Value $	Options (000’s) #	Weighted-Average Grant Date Fair Value $
Outstanding non-vested stock options – beginning of year	3,501	2.26	1,800	4.25	1,379	4.44
Granted	—	—	2,620	1.53	1,052	4.21
Vested	(1,384)	2.64	(807)	4.18	(609)	4.65
Forfeited	(32)	4.71	(112)	3.33	(22)	3.93
Outstanding non-vested stock options – end of year	2,085	1.97	3,501	2.26	1,800	4.25

As of December 31, 2020, there was $1.2 million of total unrecognized compensation cost related to non-vested stock options granted under the Plans. Recognition of this compensation cost over the next three years is expected to be $1.0 million (2021) and $0.2 million (2022). During the years ended December 31, 2020, 2019, and 2018, the Company recognized $1.9 million, $3.0 million and $2.8 million, respectively, of compensation cost relating to stock options granted under the Plans. The intrinsic value of options exercised during 2020 was $nil, during 2019 was $nil and during 2018 was $nil.

As at December 31, 2020, the intrinsic value of outstanding and exercisable stock options was $nil (2019 – $3.3 million). As at December 31, 2020, the weighted-average remaining life of options vested and expected to vest was 6.7 years (2019 – 7.3 years).


	Outstanding Options			Exercisable Options
Range of Exercise Prices	Options (000’s) #	Weighted- Average Remaining Life (Years)	Weighted- Average Exercise Price $	Options (000’s) #	Weighted- Average Remaining Life (Years)	Weighted- Average Exercise Price $
$0.00 – $4.99	2,590	8.2	3.98	845	8.2	3.98
$5.00 – $9.99	1,699	6.4	8.98	1,359	6.2	9.05
$10.00 – $19.99	595	6.2	10.18	595	6.2	10.18
$20.00 – $59.99	691	2.3	35.09	691	2.3	35.09
	5,575	6.7	10.02	3,490	5.9	13.17

During 2020, no stock options were granted. The weighted-average grant-date fair value of options granted during 2019 and 2018 were $1.53 and $4.21, respectively. The fair value of each option granted was estimated on the date of the grant using the Black-Scholes option pricing model. The following weighted-average assumptions were used in computing the fair value of the options granted: expected volatility of 65.2% in 2019 and 64.8% in 2018; expected life of 5.5 years in 2019 and 5.5 years in 2018; dividend yield of 5.9% in 2019 and 2.5% in 2018; risk-free interest rate of 2.5% in 2019, and 2.6% in 2018; and estimated forfeiture rate of 6.0% in 2019 and 7.4% in 2018. The expected life of the options granted was

The Company grants restricted stock units and performance share units to certain eligible officers and employees of the Company. Each restricted stock unit and restricted stock award is equal in value to one share of the Company’s common stock plus reinvested dividends from the grant date to the vesting date. The restricted stock units vest equally over three years from the grant date. Upon vesting, the value of the restricted stock units and restricted stock awards are paid to each grantee in the form of shares.

During 2020, the Company granted 986,314 restricted stock units with a fair value of $3.1 million, to certain of the Company’s employees. During 2020, a total of 480,498 restricted stock units with a market value of $3.0 million vested and that amount, net of withholding taxes, was paid to grantees by issuing 256,780 shares of common stock. During 2019, the Company granted 831,118 restricted stock units with a fair value of $3.3 million, to certain of the Company’s employees. During 2019, a total of 317,283 restricted stock units with a market value of $3.0 million vested and that amount, net of withholding taxes, was paid to grantees by issuing 182,653 shares of common stock. During 2018, the Company granted 625,878 restricted stock units with a fair value of $5.4 million, to certain of the Company’s employees. During 2018, a total of 206,420 restricted stock units with a market value of $2.7 million vested and that amount, net of withholding taxes, was paid to grantees by issuing 118,209 shares of common stock. For the year ended December 31, 2020, the Company recorded an expense of $5.2 million (2019 – $3.3 million, 2018 – $3.0 million) related to the restricted stock units.

During 2020, the Company also granted 203,468 (2019 – 111,808 and 2018 – 79,869) shares as restricted stock awards with a fair value of $0.6 million (2019 – $0.4 million and 2018 – $0.7 million), based on the quoted market price, to certain of the Company’s directors. The shares of restricted stock are issued when granted.

During the years ended December 31, 2020, 2019 and 2018, 29,595, 35,419 and 17,498 common units of Teekay LNG, respectively, and 13,125, 19,918 and 21,004 shares of Class A common stock of Teekay Tankers, respectively, with aggregate values of $0.6 million, $0.7 million, and $0.5 million, respectively, were granted and issued to the non-management directors of the general partner of Teekay LNG and the non-management directors of Teekay Tankers as part of their annual compensation for 2020, 2019 and 2018.

Teekay LNG and Teekay Tankers grant equity-based compensation awards as incentive-based compensation to certain employees of Teekay’s subsidiaries that provide services to Teekay LNG and Teekay Tankers. During 2020, 2019 and 2018, Teekay LNG granted restricted unit awards and Teekay Tankers granted restricted stock-based compensation awards with respect to 243,940, 80,100 and 62,283 units of Teekay LNG and 182,120, 99,064 and 95,330 Class A common shares of Teekay Tankers, respectively, with aggregate grant date fair values of $6.2 million, $2.0 million and $2.1 million, respectively, based on Teekay LNG and Teekay Tankers’ closing unit or stock prices on the grant dates.

Each restricted unit or restricted stock unit is equal in value to one of Teekay LNG’s or Teekay Tankers’ common units or common shares plus reinvested distributions or dividends from the grant date to the vesting date. The awards vest equally over three years from the grant date. Any portion of an award that is not vested on the date of a recipient’s termination of service is canceled, unless their termination arises as a result of the recipient’s retirement, in which case the award will continue to vest in accordance with the vesting schedule. Upon vesting, the awards are paid to a substantial majority of the grantees in the form of common units or common shares, net of withholding tax.