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Stock-based Compensation Plans (Tables)
 12 Months Ended
Dec. 31, 2017
Allocation of Stock-Based Compensation by Functional Category

The following table details the amount of stock-based compensation that is allocated to functional expense categories for each of the years in the three-year period ended December 31, 2017 (in thousands):

 

2017 (1)

 

 

2016

 

  

2015

 

Direct operating expense

$

2,060

  

 

$

2,302

  

  

$

2,780

  

Brokered natural gas and marketing expense

 

1,437

 

 

 

1,725

 

  

 

2,132

 

Exploration expense

 

2,742

 

 

 

2,298

 

  

 

2,985

 

General and administrative expense

 

74,873

  

 

 

49,293

 

  

 

49,687

 

Termination costs

 

1,664

 

 

 

—

 

 

 

217

 

Total

$

82,776

  

 

$

55,618

  

  

$

57,801

  

 

(1)

Includes $30.8 million accelerated vesting of equity grants.
Restricted Stock and Restricted Stock Units Outstanding

The following is a summary of the status of our non-vested restricted stock outstanding at December 31, 2017:

 

 

Restricted Stock
Equity Awards

 

  

Restricted Stock
Liability Awards

 

 

Shares

 

 

Weighted
Average Grant
Date Fair Value

 

  

Shares

 

 

Weighted
Average Grant
Date Fair Value

 

Outstanding at December 31, 2014

 

360,415

 

 

 $

79.60

  

  

 

304,504

 

 

 $

80.33

  

Granted

 

587,711

 

 

 

52.29

  

  

 

343,397

 

 

 

55.92

  

Vested

 

(480,253

)

 

 

65.21

  

  

 

(330,870

)

 

 

68.71

  

Forfeited

 

(31,109

)

 

 

64.73

  

  

 

(8,294

)

 

 

74.22

  

Outstanding at December 31, 2015

 

436,764

 

 

 

59.74

  

  

 

308,737

 

 

 

65.80

  

Granted

 

973,491

 

 

 

28.51

 

  

 

540,128

 

 

 

35.92

 

Vested

 

(525,617

)

 

 

43.83

 

  

 

(374,328

)

 

 

51.40

 

Forfeited

 

(118,667

)

 

 

42.60

  

  

 

(49,519

)

 

 

40.33

  

Outstanding at December 31, 2016

 

765,971

 

 

 

33.62

 

 

 

425,018

 

 

 

43.48

  

Granted

 

888,326

 

 

 

32.61

 

 

 

543,438

 

 

 

25.91

 

Vested

 

(698,563

)

 

 

34.82

 

 

 

(908,912

)

 

 

33.71

 

Forfeited

 

(122,676

)

 

 

32.91

 

 

 

(4,342

)

 

 

31.10

 

Outstanding at December 31, 2017

 

833,058

 

 

 $

31.64

 

 

 

55,202

 

 

 $

32.26

 

 
Schedule of Share Based Payment Award Performance Stock Awards Valuation Assumptions

The following assumptions were used to estimate the fair value of PSUs granted during the years ended December 31, 2017, 2016 and 2015:

 

  

Year Ended December 31, 2017

 

 

  

2017

 

  

2016

 

 

2015

 

Risk-free interest rate

 

 

1.49

%

 

 

0.94

%

 

 

1.02

%

Expected annual volatility

 

 

44

%

 

 

49

%

 

 

33

%

Grant date fair value per unit

 

$

26.26

 

 

$

36.64

 

 

$

56.78

 

 
Summary of SARs Outstanding and Exercisable

The following table shows information with respect to SARs outstanding and exercisable at December 31, 2017:

 

 

Outstanding

 

 

Exercisable

 

Range of Exercise Prices

 

Shares

 

 

Weighted
Average
Remaining Contractual Life (in years)

 

 

Weighted Average Exercise Price

 

 

Shares

 

 

Weighted Average Exercise Price

 

$ 70.00–$ 79.99

 

 

380,879

 

 

 

0.36

 

 

$

76.51

 

 

 

380,879

 

 

$

76.51

 

80.00–81.15

 

 

1,900

  

 

 

0.69

  

 

 

81.15

  

 

 

1,900

  

 

 

81.15

  

Total

 

 

382,779

  

 

 

0.36

  

 

$

76.54

  

 

 

382,779

  

 

$

76.54

  

 
Summary of Change in Benefit Obligations Recognized in Comprehensive Income on Pre-tax Basis and Amounts Recognized in Consolidated Balance Sheets

Effective fourth quarter 2017, we implemented a post-retirement benefit plan to assist in providing health care to officers who are active employees (including their spouses) and have met certain age and service requirements. These benefits are not funded in advance and are provided up to age 65 or at the date they become eligible for Medicare, subject to various cost-sharing features (in thousands).

 

December 31,

2017

 

Accumulated benefit obligation

 $

1,769

 

 

 

 

 

Change in benefit obligations (recognized in comprehensive income – pretax)

 

 

 

Beginning balance at December 31, 2016

 $

—

 

       Prior service cost

 

1,769

 

Total other comprehensive income (loss) at December 31, 2017

 $

1,769

 

 

 

 

 

Amounts recognized in the consolidated balance sheets:

 

 

 

Noncurrent liability-accrued benefit cost

$

1,769

 

 
Summary of Assumptions Used to Determine Benefit Obligation

The following summarizes the assumptions used to determine the benefit obligation at December 31, 2017.

 

December 31,

2017

 

Weighted average assumptions used to determine benefit obligation:

 

 

 

Discount rate

 

3.3

%

Assumed weighted average healthcare cost trend rates:

 

 

 

Initial healthcare trend rate

 

7.00

%

Ultimate trend rate

 

5.00

%

Year ultimate trend rate reached

 

2028

 

 
Stock Option and SARs Activities

Information with respect to our SARs activities is summarized below.

 

Shares

 

 

Weighted
Average
Exercise Price

 

Outstanding at December 31, 2014

 

1,966,549

 

 

 $

59.80

  

Exercised

 

(427,598

)

 

 

45.67

  

Expired/forfeited

 

(27,974

)

 

 

63.10

  

Outstanding at December 31, 2015

 

1,510,977

 

 

 

63.73

  

Expired/forfeited

 

(507,377

)

 

 

53.16

  

Outstanding at December 31, 2016

 

1,003,600

 

 

 

69.08

  

Expired/forfeited

 

(620,821

)

 

 

62.29

 

Outstanding at December 31, 2017

 

382,779

 

 

$

76.54

 

 
Performance-based PG-PSUs and RG-PSUs  
Summary of Non-Vested Awards Activities

The following is a summary of our non-vested PG/RG-PSUs awards outstanding at December 31, 2017:

 

 

 

 

 

Number of
Units

 

 

 

Weighted
Average
Grant Date Fair
Value
of Range Stock

 

Outstanding at December 31, 2016

 

—

 

 

 

—

 

Units granted (a)

 

122,921

 

 

$

25.53

 

Outstanding at December 30, 2017

 

122,921

 

 

$

25.53

 

(a) Amounts granted reflect the number of performance units granted; however, the actual payout of shares will be between zero and 150% depending on achievement of specifically identified performance targets.
Performance Based TSR - PSUs  
Summary of Non-Vested Awards Activities

The following is a summary of our non-vested TSR – PSUs award activities:

 

 


Number of Units

 

 

Weighted
Average
Grant Date Fair Value

 

Outstanding at December 31, 2014

 

 

226,418

 

 

$

86.16

 

Granted (a)

 

 

276,204

 

 

 

56.78

 

Forfeited

 

 

(2,679

)

 

 

82.60

 

Outstanding at December 31, 2015

 

 

499,943

 

 

 

69.95

 

Granted (a)

 

 

413,959

 

 

 

36.64

 

Forfeited

 

 

(42,603

)

 

 

46.09

 

Outstanding at December 31, 2016

 

 

871,299

 

 

 

55.29

 

Granted (a)

 

 

358,519

 

 

 

26.26

 

Vested and issued (b)

 

 

(85,461

)

 

 

86.23

 

Forfeited

 

 

(134,515

)

 

 

85.24

 

Outstanding at December 31, 2017

 

 

1,009,842

 

 

$

38.38

 

(a) These amounts reflect the number of performance units granted. The actual payout of shares may be between zero and 150% of the performance units granted depending on the total shareholder return ranking compared to our peer companies at the vesting date.

(b) Includes 85,461 TSR-PSU awards issued related to the 2014 performance period where the return on our common stock was the 67th percentile for the February 2014 grant and 56th percentile for the May 2014 grant. The remaining 2014 awards are considered to be forfeited.