Stock-Based Compensation

3 Months Ended

Mar. 31, 2017

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

STOCK-BASED COMPENSATION

For restricted stock awards and stock options, we had:



	Three Months Ended
	March 31,
	2017		2016
	(In millions)
Recognized stock compensation expense	$	2.6	$	3.3
Capitalized stock compensation cost for our oil and natural gas properties	0.4		0.8
Tax benefit on stock based compensation	1.0		1.3

The remaining unrecognized compensation cost related to unvested awards at March 31, 2017 is approximately $19.8 million, of which $2.2 million is anticipated to be capitalized. The weighted average period of time over which this cost will be recognized is one year.

Our Second Amended and Restated Unit Corporation Stock and Incentive Compensation Plan effective May 6, 2015 (the amended plan) allows us to grant stock-based and cash-based compensation to our employees (including employees of subsidiaries) as well as to non-employee directors. As of the date of this report, a total of 4,500,000 shares of the company's common stock was authorized for issuance to eligible participants under the amended plan with 2,000,000 shares being the maximum number of shares that can be issued as "incentive stock options."

We did not grant any SARs or stock options during either of the three month periods ending March 31, 2017 or 2016. The following table shows the fair value of restricted stock awards granted to employees and non-employee directors during the three month periods ending March 31, 2017 and 2016:



	Three Months Ended						Three Months Ended
	March 31, 2017						March 31, 2016
	Time Vested			Performance Vested			Time Vested			Performance Vested
Shares granted:
Employees	461,799			152,373			486,578			152,373
Non-employee directors	—			—			—			—
	461,799			152,373			486,578			152,373
Estimated fair value (in millions):⁽¹⁾
Employees	$	11.4		$	4.0		$	2.6		$	0.8
Non-employee directors	—			—			—			—
	$	11.4		$	4.0		$	2.6		$	0.8
Percentage of shares granted expected to be distributed:
Employees	94		%	105		%	94		%	52		%
Non-employee directors	N/A			N/A			N/A			N/A

_______________________


(1)	Represents 100% of the grant date fair value. (We recognize the grant date fair value minus estimated forfeitures.)

The time vested restricted stock awards granted during the first three months of 2017 and 2016 are being recognized over a three year vesting period. During the first quarter of 2017 and 2016, there were two different performance vested restricted stock awards granted to certain executive officers. The first will cliff vest three years from the grant date based on the company's achievement of certain stock performance measures at the end of the term and will range from 0% to 200% of the restricted shares granted as performance shares. The second will vest, one-third each year, over a three year vesting period based on the company's achievement of cash flow to total assets (CFTA) performance measurement each year and will range from 0% to 200%. Based on a probability assessment of the selected performance criteria at March 31, 2017, the participants are estimated to receive 111% of the 2017, 132% of the 2016, and 27% of the 2015 performance based shares. The CFTA performance measurement at March 31, 2017 was assessed to vest at target or 100%. The total aggregate stock compensation expense and capitalized cost related to oil and natural gas properties for 2017 awards for the first three months of 2017 was $1.0 million.