Annual report pursuant to Section 13 and 15(d)

Share-Based Compensation

v3.22.4
Share-Based Compensation
 12 Months Ended
Dec. 31, 2022
Share-Based Payment Arrangement [Abstract]  
Share-Based Compensation Share-Based Compensation
2020 Omnibus Incentive Plan
Shares-based awards are granted under the 2020 Omnibus Incentive Plan (the “2020 Plan”), which replaced the 2018 Omnibus Incentive Plan (the “2018 Plan”). From the effective date of the 2020 Plan, no further awards may be granted under the 2018 Plan; however, awards previously granted under the 2018 Plan will remain outstanding in accordance with their terms. At December 31, 2022, there were 1,703,829 shares available for future share-based awards under the 2020 Plan. 
RSU Equity Awards
The following table summarizes RSU Equity Award activity for the year ended December 31, 2022:
RSU Equity Awards (In thousands) Weighted Average Grant-Date Fair Value per Share
Unvested at the beginning of the year 968  $34.04 
Granted 396  $57.85 
Vested (376) $35.32 
Forfeited (188) $35.95 
Unvested at the end of the year 800  $44.79 
Grant activity for the years ended December 31, 2022, 2021 and 2020 primarily consisted of RSU Equity Awards granted to executives and employees as part of the annual grant of long-term equity incentive awards with a weighted average grant date fair value of $57.85, $38.59 and $21.07, respectively.
For performance-based RSU Equity Awards granted in 2020 that vested on December 31, 2022, the number of performance-based RSU Equity Awards that could vest was based on a calculation that compares the Company’s total shareholder return (“TSR”) to the same calculated return of a group of peer companies selected by the Company and can range between 0% and 300% of the target units. No performance-based RSU Equity Awards were granted during 2022 and 2021.
The following table summarizes the shares that vested and did not vest as a result of the Company’s performance as compared to its peers.
Years Ended December 31,
Performance-based Equity Awards 2022 2021 2020
Vesting Multiplier 18  % 50  %
50% - 100%
Target 86,455 28,356 21,920
Vested at end of performance period 15,559 14,177 11,372
Did not vest at end of performance period 70,896 14,179 10,548
The Company recognizes expense for performance-based RSU Equity Awards based on the fair value of the awards at the grant date. Awards with a performance-based provision do not allow for the reversal of previously recognized expense, even if the market metric is not achieved and no shares ultimately vest. For the year ended December 31, 2020, the grant date fair value of the performance-based RSU Equity Awards, calculated using a Monte Carlo simulation, was $3.4 million. The following table
summarizes the assumptions used and the resulting grant date fair value per performance-based RSU Equity Award granted during the year ended December 31, 2020:
Performance-based Awards June 29, 2020 January 31, 2020
Expected term (in years) 2.5 2.9
Expected volatility 113.2  % 54.8  %
Risk-free interest rate 0.2  % 1.3  %
Dividend yield —  % —  %
The aggregate fair value of RSU Equity Awards that vested during the years ended December 31, 2022, 2021 and 2020 was $22.4 million, $8.7 million and $1.6 million, respectively. As of December 31, 2022, unrecognized compensation costs related to unvested RSU Equity Awards were $23.9 million and will be recognized over a weighted average period of 1.9 years.
Cash-Settled Awards
As of December 31, 2022 and 2021, the Company had a total liability of $6.5 million and $15.6 million, respectively, for the outstanding Cash-Settled Awards.
Share-Based Compensation Expense, Net
Share-based compensation expense associated with the RSU Equity Awards, Cash-Settled RSU Awards, and Cash SARs, net of amounts capitalized, is included in “General and administrative” in the consolidated statements of operations. The following table presents share-based compensation expense (benefit), net for each respective period:
Years Ended December 31,
2022 2021 2020
(In thousands)
RSU Equity Awards $15,535  $13,230  $13,030 
Cash-Settled Awards (7,493) 12,627  (4,115)
8,042  25,857  8,915 
Less: amounts capitalized to oil and gas properties (5,535) (12,934) (6,252)
Total share-based compensation expense, net $2,507  $12,923  $2,663