Stock-Based Compensation

6 Months Ended

Jun. 30, 2020

Share-based Payment Arrangement [Abstract]

Stock-Based Compensation

STOCK-BASED COMPENSATION

On the Effective Date, our equity-based awards outstanding immediately before the Effective Date were cancelled. Under the Plan, Warrants will be issued to holders of the equity-based awards outstanding immediately before the Effective Date if the holder did not opt out of the releases under the Plan. We expect to issue the warrants during the fourth quarter of 2020.

The following table summarizes the outstanding equity-based awards, which consisted of restricted stock awards and stock options, for the time periods shown:

	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2020		2019		2020		2019
	(In millions)
Recognized stock compensation expense	$	1.6	$	4.7	$	4.1	$	8.5
Capitalized stock compensation cost for our oil and natural gas properties	—		0.7		—		1.3
Tax benefit on stock-based compensation	0.4		1.2		1.0		2.1

The remaining unrecognized compensation cost related to unvested awards as of June 30, 2020 is approximately $5.7 million. The weighted average period over which this cost will be recognized is 1.1 years.

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) and to non-employee directors. There are 7,230,000 shares of the company's common stock 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 stock options during either of the three or six month periods ending June 30, 2020 or 2019. We did not grant any restricted stock awards during the three or six month periods ending June 30, 2020. This table shows the fair value of restricted stock awards granted to employees and non-employee directors during the periods indicated:

	Three Months Ended
	June 30, 2019
	Time Vested			Performance Vested
Shares granted:
Employees	1,500			—
Non-employee directors	72,784			—
	74,284			—
Estimated fair value (in millions):(1)
Employees	$	—		$	—
Non-employee directors	0.9			—
	$	0.9		$	—
Percentage of shares granted expected to be distributed:
Employees	95		%	N/A
Non-employee directors	100		%	N/A

_______________________

1.The performance shares represent 100% of the grant date fair value. (We recognize the grant date fair value minus estimated forfeitures.)

	Six Months Ended
	June 30, 2019
	Time Vested			Performance Vested
Shares granted:
Employees	927,173			424,070
Non-employee directors	72,784			—
	999,957			424,070
Estimated fair value (in millions): (1)
Employees	$	14.6		$	7.1
Non-employee directors	0.9			—
	$	15.5		$	7.1
Percentage of shares granted expected to be distributed:
Employees	95		%	54		%
Non-employee directors	100		%	N/A

_______________________

1.The performance shares represent 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 six months of 2019 are being recognized over a three-year vesting period. During the first quarter of 2019, two performance vested restricted stock awards were granted to certain executive officers. The first cliff vests three years from the grant date based on the company's achievement of certain stock performance measures (TSR) at the end of the term and will range from 0% to 200% of the restricted shares granted as performance shares. The second vests, one-third each year, over a three-year vesting period subject to 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 TSR performance criteria at June 30, 2020, the participants are not expected to receive any performance-based shares. We expense the CFTA performance award at target or 100%.