Stock Incentive Plan

6 Months Ended

Jun. 30, 2025

Share-Based Payment Arrangement [Abstract]

The Granite Ridge Resources, Inc. 2022 Omnibus Incentive Plan (the “Plan”) provides the Company the ability to grant, among other award types, stock options, restricted stock awards, and performance stock units ("PSUs") to directors, officers, employees and consultants or advisors employed by or providing service to the Company.

During the six months ended June 30, 2025 and 2024, the Company granted restricted stock awards, stock options, and PSUs. Stock-based compensation expense during the three and six months ended June 30, 2025 was $0.4 million and $1.0 million, respectively. Stock-based compensation expense during the three and six months ended June 30, 2024 was $0.6 million and $1.1 million, respectively.

Restricted Stock Awards - The Company grants service-based restricted stock awards to certain of its employees and consultants under the Plan, which generally vest ratably over a period of three years or cliff vest at the end of five years, and to non-employee directors, which vest in full after one year. Restricted stock awards are valued at the closing price of the Company's common stock on the date of grant. All restricted shares are legally issued and outstanding. If an employee terminates employment prior to the restriction lapse date, the awarded shares are forfeited and canceled and are no longer considered issued and outstanding. For restricted stock awards granted prior to March 2025, the holders of such unvested restricted stock awards have voting rights and the right to receive dividends. For restricted stock awards granted in March 2025 and thereafter, the holders of such unvested restricted stock awards do not have voting rights but do have the right to receive dividends. The Company recognizes compensation expense utilizing graded vesting whereby compensation expense is recognized over the service period for each separately vesting tranche.

PSUs - The Company grants PSUs to certain of its officers under the Plan. PSUs represent the contingent right to receive shares of the Company’s common stock once the PSU is vested and earned. PSUs, other than those granted during the three months ended June 30, 2025, cliff vest at the end of three years, generally subject to continued employment through the performance period. The total number of shares eligible to be earned may range from zero to 200% of the target number of PSUs granted, determined based upon achievement of certain "financial performance" and "market performance" criteria for the Company and individual performance criteria for the officers awarded PSUs. Financial performance is based on the Company's financial performance at the end of the applicable performance period, while market performance is based on the relative standing of total shareholder return (“TSR”) achieved by the Company compared to the TSR achieved by a predetermined group of peer companies at the end of the applicable performance period. Individual performance criteria is based on the officers' performance relative to individual performance goals at the end of the performance period. The Company utilizes the Monte Carlo simulation method to determine the fair value of the PSUs based on market performance, while PSUs based on financial performance are valued using the closing price of the Company's common stock on the date of grant.

During the three months ended June 30, 2025, the Company granted 644,330 PSUs to certain of its officers under the Plan. These PSUs are eligible to vest, generally subject to continued employment, upon the satisfaction of certain stock price thresholds during the performance period, which ends on December 31, 2032. Each PSU represents the contingent right to receive one share of common stock once the PSU is earned. Each PSU is earned based on whether the Company’s stock price achieves a target average stock price for any 20 consecutive trading days during the performance period. If the stock price thresholds are not met by the end of the performance period, the PSUs will be forfeited and no shares of common stock will be issued. Compensation expense for these awards is based on the grant date fair market value of the award, calculated using a Monte Carlo simulation, and such costs are recorded on a straight-line basis over the derived requisite service period for each separately vesting portion of the award, as if the award was, in-substance, multiple awards, as applicable.

Stock Options - The Company grants stock options to certain of its officers under the Plan. The Company's outstanding stock options expire 10 years following the date of grant. Pursuant to the stock options granted under the Plan, 33% of the options vest immediately with an additional 33% to vest on each of the next two anniversaries of the date of the grant, generally subject to continued employment through each such vesting date. During the first quarter of 2025, the Company granted 110,257 stock options with an exercise price of $5.61 per share. During the first quarter of 2024, the Company granted 134,375 stock options with an exercise price per share of $6.06.

Stock Awards - The Company may issue other awards to its employees and consultants under the Plan.

A summary of the Company’s activity under the Plan for the restricted stock awards, PSUs and stock options for the six months ended June 30, 2025 is presented below:


	Restricted Stock Awards		Performance Stock Units		Stock Options
Outstanding at December 31, 2024	518,048		97,532		526,483
Awards granted(1)	625,527		720,980		110,257
Awards canceled/forfeited	(97,555)		(99,105)		(68,777)
Awards vested(2)	(253,220)		—		—

Outstanding at June 30, 2025	792,800		719,407		567,963

(1) Weighted average grant date fair value per share / unit	$	5.86	$	5.38	$	1.21
(2) Represents restricted stock and PSUs vested during the period. During the six months ended June 30, 2025, 212,249 stock options vested. As of June 30, 2025, there were a total of 518,444 stock options exercisable.

A summary of the Company’s activity under the Plan for the restricted stock awards, PSUs and stock options for the six months ended June 30, 2024 is presented below:


	Restricted Stock Awards		Performance Stock Units		Stock Options
Outstanding at December 31, 2023	295,990		26,574		392,108
Awards granted(1)	383,430		70,958		134,375
Awards vested(2)	(139,790)		—		—
Outstanding at June 30, 2024	539,630		97,532		526,483
(1) Weighted average grant date fair value per share / unit	$	6.07	$	8.64	$	1.38
(2) Represents restricted stock and PSUs vested during the period. During the six months ended June 30, 2024, 175,493 stock options vested. As of June 30, 2024, there were a total of 306,195 stock options exercisable.