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Deferred Compensation Awards
 12 Months Ended
Dec. 31, 2022
Share-Based Payment Arrangement [Abstract]  
Deferred Compensation Awards DEFERRED COMPENSATION AWARDS
Stock-based compensation
Stock-based compensation related to option awards is measured based on the fair value of the award. The fair value of stock option awards is determined using a Black-Scholes option-pricing model. We recognize compensation expense associated with the options over the vesting period.
2017 stock option grant
In August 2017, GWRI's Board of Directors granted stock options to acquire 465,000 shares of GWRI's common stock to employees throughout the Company. The options were granted with an exercise price of $9.40, the market price of the Company's common shares on the NASDAQ Global Market at the close of business on August 10, 2017. The options vested over a four-year period, with 25% having vested in August 2018, 25% having vested in August 2019, 25% having vested in August 2020, and 25% vesting in August 2021. The options have a 10-year life. The Company expensed the $1.1 million fair value of the stock option grant ratably over the four-year vesting period. Stock-based compensation expense of $0.0 million and $0.2 million was recorded for years ended December 31, 2022 and 2021, respectively. As of December 31, 2022, 46,370 options have been exercised and 100,309 options have been forfeited with 318,321 outstanding.
2019 stock option grant
In August 2019, GWRI's Board of directors granted stock options to acquire 250,000 shares of GWRI's common stock to employees throughout the Company. The options were granted with an exercise price of $11.26, the market price of the Company's common shares on the NASDAQ Global Market at the close of business on August 13, 2019. The options vest over a four-year period, with 25% having vested in August 2020, 25% having vested in August 2021, 25% having vested in August 2022, and 25% vesting in August 2023. The options have a 10-year life. The Company will expense the $0.8 million fair value of the stock option grant ratably over the four-year vesting period. Stock-based compensation expense of $0.2 million was recorded for both years ended December 31, 2022 and 2021. As of December 31, 2022, 11,251 options have been exercised and 39,090 options have been forfeited with 199,659 outstanding.
A summary of stock option activity is as follows (in thousands, except option prices and years):
Number of OptionsWeighted Average Exercise PriceWeighted Average Remaining Contractual LifeAggregate Intrinsic Value
Options Outstanding at December 31, 2020626$10.12 7.32,683.6 
Options Vested at December 31, 2020348 $9.72 7.01,629.7 
Granted— 
Exercised$(87)$9.95 
Forfeited$(18)$11.17 
Options Outstanding at December 31, 2021$520 $10.12 6.63,635.4 
Options Vested at December 31, 2021$420 $9.84 6.23,050.9 
Granted$— 
Exercised$(2)$9.61 
Forfeited$— 
Options Outstanding at December 31, 2022$518 $10.12 5.41,638.4 
Options Vested at December 31, 2022$468 $10.00 5.31,537.6 
Phantom stock/Restricted stock units compensation

The following table details total awards granted and the number of units outstanding as of December 31, 2022 along with the amounts paid to holders of the phantom stock units ("PSUs") and/or restricted stock units ("RSUs") for the years ended December 31, 2022 and 2021 (in thousands, except unit amounts):
Amounts Paid For the Year Ended December 31,
Grant DateUnits GrantedUnits Outstanding20222021
Q1 201830,907 — $— $39 
Q1 201932,190 — 45 180 
Q1 202022,481 1,824 108 125 
Q1 2021(1)
27,403 11,155 132 118 
Q1 2022(1)
22,262 16,697 79 — 
Total135,243 29,676 $364 $462 
(1)Pursuant to the Global Water Resources, Inc. 2020 Omnibus Incentive Plan, effective May 7, 2020, long-term incentive awards are no longer granted in the form of PSUs and are granted as RSUs instead.
Stock appreciation rights compensation
The following table details the recipients of the stock appreciation rights ("SARs") awards, the grant date, units granted, exercise price, outstanding units as of December 31, 2022 and amounts paid during the years ended December 31, 2022 and 2021 (in thousands, except unit and per unit amounts):
Amounts Paid For the Year Ended December 31,
RecipientsGrant DateUnits GrantedExercise PriceUnits Outstanding20222021
Members of Management (1)(2)
Q1 2015299,000 $4.26 65,500 $62 $269 
Members of Management (1)(3)
Q3 2017103,000 $9.40 17,000 — 321 
Members of Management (1)(4)
Q1 201833,000 $8.99 8,250 — 189 
Total 735,000  90,750 $62 $779 
(1)The SARs vest ratably over 16 quarters from the grant date.
(2)The exercise price was determined to be the fair market value of one share of GWRC stock on the grant date of February 11, 2015.
(3)The exercise price was determined to be the fair market value of one share of GWRI stock on the grant date of August 10, 2017.
(4)The exercise price was determined to be the fair market value of one share of GWRI stock on the grant date of March 12, 2018.

For the twelve months ended December 31, 2022 and 2021, the Company recorded approximately $0.04 million and $1.1 million of compensation expense related to the PSUs/RSUs and SARs, respectively. These are liability awards, so when the stock price decreases, cumulative compensation expense is reduced, which can lead to negative compensation in a given period. Based on GWRI’s closing share price on December 30, 2022 (the last trading date of the year), deferred compensation expense to be recognized over future periods is estimated for the years ending December 31 as follows (in thousands):
 PSUsSARs
2023241 — 
202499 — 
Total340 — 

Restricted stock compensation

On May 7, 2020, the Company's stockholders approved the Global Water Resources, Inc. 2020 Omnibus Incentive Plan which allows restricted stock awards as a form of compensation. A restricted stock award ("RSA") represents the right to receive a share of the Company's common stock. RSAs vest over two to three years, beginning on the date of the grant. The Company assumes that forfeitures will be minimal and recognizes forfeitures as they occur, which results in a reduction in compensation expense. During the year ended December 31, 2022, 87,000 RSAs were issued. The Company recorded approximately $1.3 million of compensation expense related to the grant and partial vesting of RSAs for the year ended December 31, 2022. During the year ended December 31, 2021, 177,490 RSAs were issued. The Company recorded approximately $1.2 million of compensation expense related to the grant and partial vesting of RSAs for the year ended December 31, 2021. The following table summarizes the RSA transactions for the year ended December 31, 2022:

Number of RSAsWeighted Average Fair Value
Nonvested RSAs at the beginning of period225,664 $14.89 
Granted87,000 16.53 
Vested69,224 13.83 
Forfeited50,972 14.02 
Nonvested RSAs at the end of period192,468 $15.57