Stock-Based Compensation

3 Months Ended

Mar. 31, 2019

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

Stock-Based Compensation

STOCK-BASED COMPENSATION

For restricted stock awards and stock options, we had:

	Three Months Ended
	March 31,
	2019		2018
	(In millions)
Recognized stock compensation expense	$	3.8	$	5.5
Capitalized stock compensation cost for our oil and natural gas properties	0.6		0.4
Tax benefit on stock-based compensation	0.9		1.3

The remaining unrecognized compensation cost related to unvested awards at March 31, 2019 is approximately $30.4 million, of which $4.2 million is anticipated to be capitalized. The weighted average period over which this cost will be recognized is 1.0 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) and to non-employee directors. 7,230,000 shares of the company's common stock are 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 granted no SARs or stock options during either of the three month periods ending March 31, 2019 or 2018. This table shows the fair value of restricted stock awards granted to employees and non-employee directors during the periods indicated:

	Three Months Ended						Three Months Ended
	March 31, 2019						March 31, 2018
	Time Vested			Performance Vested			Time Vested			Performance Vested
Shares granted:
Employees	925,673			424,070			839,498			362,070
Non-employee directors	—			—			—			—
	925,673			424,070			839,498			362,070
Estimated fair value (in millions):(1)
Employees	$	14.6		$	7.1		$	16.1		$	7.3
Non-employee directors	—			—			—			—
	$	14.6		$	7.1		$	16.1		$	7.3
Percentage of shares granted expected to be distributed:
Employees	95		%	64		%	95		%	63		%
Non-employee directors	N/A			N/A			N/A			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 three months of 2019 and 2018 are being recognized over a three-year vesting period. During the first quarter of 2019 and 2018, two performance vested restricted stock awards were 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 (TSR) 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 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 March 31, 2019, the participants are estimated to receive 28% of the 2019 and 74% of the 2018 performance-based shares. The CFTA performance measurement at March 31, 2019 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 2019 awards for the first three months of 2019 was $1.0 million.