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Employee Benefits Plans and Share-Based Compensation | 9 Months Ended
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Sep. 30, 2023
Compensation And Employee Benefit Plans [Abstract] |
Employee Benefits Plans and Share-Based Compensation | Note 7 — Employee Benefits Plans and Share-Based Compensation EnVen Acquisition Severance The following table summarizes severance accrual activity in connection the EnVen Acquisition included in “Other current liabilities” and “Other long-term liabilities” on the Condensed Consolidated Balance Sheets as of September 30, 2023 (in thousands):
Severance accrual at December 31, 2022 | $ | — |
Accrual additions |  | 24,904 |
Benefit payments |  | (13,915 | )
Severance accrual at September 30, 2023 |  | 10,989 |
Less: Current portion at September 30, 2023 |  | 10,842 |
Long-term portion at September 30, 2023 | $ | 147 |
The above table includes involuntary termination benefits that are being provided pursuant to a one-time benefit arrangement that is being spread over the future service period through the termination date. Involuntary termination benefits are also being provided pursuant to contractual termination benefits required by the terms of existing employment agreements. Pursuant to the EnVen Merger Agreement, a rabbi trust was established and funded with $14.5 million at closing to pay a portion of future severance benefits associated with the contractual termination benefits. As of September 30, 2023, the rabbi trust held $6.5 million in assets of which $6.2 million and $0.3 million are included in “Other current assets” and “Other assets,” respectively, on the Condensed Consolidated Balance Sheets and both of which are included in the severance accrual at September 30, 2023 listed above. The assets of the rabbi trust are available to satisfy the claims of our creditors in the event of bankruptcy or insolvency. Severance costs are reflected in “General and administrative expense” on the Condensed Consolidated Statements of Operations. Long Term Incentive Plans Restricted Stock Units (“RSUs”) — The following table summarizes RSU activity under the Talos Energy Inc. 2021 Long Term Incentive Plan (the “2021 LTIP”) for the nine months ended September 30, 2023:
| RSUs |  | Weighted Average Grant Date Fair Value |
Unvested RSUs at December 31, 2022 |  | 3,215,504 |  | $ | 12.79 |
Granted |  | 1,153,580 |  | $ | 16.24 |
Vested |  | (1,644,828 | ) | $ | 12.06 |
Forfeited |  | (277,400 | ) | $ | 14.07 |
Unvested RSUs at September 30, 2023(1) |  | 2,446,856 |  | $ | 14.77 |
(1) As of September 30, 2023, 26,975 of the unvested RSUs were accounted for as liability awards in “Accrued liabilities” on the Condensed Consolidated Balance Sheets. Performance Share Units (“PSUs”) — The following table summarizes PSU activity under the 2021 LTIP for the nine months ended September 30, 2023:
| PSUs |  | Weighted Average Grant Date Fair Value |
Unvested PSUs at December 31, 2022 |  | 638,601 |  | $ | 23.66 |
Granted(1) |  | 593,472 |  | $ | 18.78 |
Forfeited |  | (147,286 | ) | $ | 21.47 |
Unvested PSUs at September 30, 2023 |  | 1,084,787 |  | $ | 21.29 |
(1) There were 296,736 PSUs granted that are eligible to vest based on continued employment and the Company’s annualized absolute total shareholder return (“TSR”) over a three-year performance period. An additional 296,736 PSUs were granted and are eligible to vest based on continued employment and the Company’s return on the wells included in the 2023 drill program over a three-year performance period. 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:
| 2023 |
| Grant |  | Grant |
| July 1 |  | March 5 |
Expected term (in years) |  | 2.5 |  |  | 2.8 |
Expected volatility |  | 66.2 | % |  | 73.1 | %
Risk-free interest rate |  | 4.6 | % |  | 4.5 | %
Dividend yield |  | — | % |  | — | %
Fair value (in thousands) | $ | 173 |  | $ | 6,165 |
Share-based Compensation Costs Share-based compensation costs associated with RSUs, PSUs and other awards are reflected as “General and administrative expense,” on the Condensed Consolidated Statements of Operations, net amounts capitalized to “Proved Properties,” on the Condensed Consolidated Balance Sheets. Because of the non-cash nature of share-based compensation, the expensed portion of share-based compensation is added back to net income in arriving at “Net cash provided by operating activities” on the Condensed Consolidated Statements of Cash Flows. The following table presents the amount of costs expensed and capitalized (in thousands):
| Three Months Ended September 30, |  | Nine Months Ended September 30, |
| 2023 |  | 2022 |  | 2023 |  | 2022 |
Share-based compensation costs | $ | 2,556 |  | $ | 7,626 |  | $ | 18,038 |  | $ | 20,597 |
Less: Amounts capitalized to oil and gas properties |  | 2,163 |  |  | 3,316 |  |  | 8,958 |  |  | 8,920 |
Total share-based compensation expense | $ | 393 |  | $ | 4,310 |  | $ | 9,080 |  | $ | 11,677 |

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- Definition Compensation And Employee Benefit Plans [Abstract] + References No definition available. + Details
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- Definition The entire disclosure for an entity's employee compensation and benefit plans, including, but not limited to, postemployment and postretirement benefit plans, defined benefit pension plans, defined contribution plans, non-qualified and supplemental benefit plans, deferred compensation, share-based compensation, life insurance, severance, health care, unemployment and other benefit plans. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 710 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org//710/tableOfContent Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 712 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org//712/tableOfContent Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 715 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org//715/tableOfContent Reference 4: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 718 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org//718/tableOfContent + Details
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