SHARE-BASED AWARDS AND CASH BASED AWARDS
|9 Months Ended|
Sep. 30, 2022
|Notes to Financial Statements|
|Share-based Payment Arrangement [Text Block]||
NOTE 9 — SHARE-BASED AWARDS AND CASH BASED AWARDS
The W&T Offshore, Inc. Amended and Restated Incentive Compensation Plan (as amended from time to time, the “Plan”) was approved by the Company’s shareholders in 2010. Under the Plan, the Company may issue, subject to the approval of the Board of Directors, stock options, stock appreciation rights, restricted stock, restricted stock units, stock awards, dividend equivalents, other stock-based awards, performance units or shares, cash awards, substitute awards or any combination of the foregoing to employees, directors and consultants.
Share-Based Awards to Employees
Restricted Stock Units (“RSUs”) – During the nine months ended September 30, 2022, the Company granted RSUs under the Plan to certain employees. RSUs outstanding as of September 30, 2022 relate to the 2022 and 2021 grants. The 2022 RSUs granted are a long-term compensation component, subject to service conditions, with of the award vesting each year on January 1, 2023, 2024, and 2025, respectively.
A summary of activity related to RSUs during the nine months ended September 30, 2022 is as follows:
Performance Share Units (“PSUs”) – During the nine months ended September 30, 2022, the Company granted PSUs under the Plan that are eligible to vest based on continued employment and the Company’s total shareholder return (“TSR”) ranking against peer companies’ TSR over a three-year performance period, which ends on December 31, 2024.
The 2021 grants were subject to performance criteria against the applicable performance period, which ended on December 31, 2021. The PSUs granted during 2021 are eligible to vest based on continued employment through October 1, 2023.
A summary of activity related to PSUs during the nine months ended September 30, 2022 is as follows:
The following table summarizes the assumptions used in the Monte Carlo simulations to calculate the fair value of the absolute TSR PSUs granted at the date indicated:
Share-Based Awards to Non-Employee Directors
During the nine months ended September 30, 2022, the Company granted Restricted Shares under the W&T Offshore, Inc. 2004 Directors Compensation Plan to non-employee directors. The Restricted Shares are subject to service conditions and vesting occurs at the end of specified service periods unless otherwise approved by the Board of Directors.
A summary of activity related to Restricted Shares during the nine months ended September 30, 2022 is as follows:
Share-Based Compensation Expense
Compensation costs for share-based payments is recognized over the requisite service period. A summary of compensation expense under share-based payment arrangements is as follows (in thousands):
Cash-Based Incentive Compensation
In addition to share-based compensation, short-term cash-based incentive awards were granted under the Plan to all eligible employees during the second quarter of 2022 subject to Company performance criteria, individual performance criteria, and continued employment through the payment date. The short-term cash-based incentive awards granted in 2021 were paid in March 2022.
Share-Based Awards and Cash-Based Awards Compensation Expense
A summary of compensation expense related to share-based awards and cash-based awards is as follows (in thousands):
The entire disclosure for share-based payment arrangement.
Reference 1: http://www.xbrl.org/2003/role/disclosureRef