Share and Incentive-Based Compensation

3 Months Ended

Mar. 31, 2018

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

Share-Based Compensation

Omnibus Incentive Plan. The SandRidge Energy, Inc. 2016 Omnibus Incentive Plan (the “Omnibus Incentive Plan”) became effective in October 2016. The Omnibus Incentive Plan authorizes the issuance of up to 4.6 million shares of SandRidge common stock to eligible persons including non-employee directors of the Company, employees of the Company or any of its affiliates, and certain consultants and advisers to the Company or any of its affiliates. The types of awards that may be granted under the Omnibus Incentive Plan include stock options, restricted stock, performance awards and other forms of awards granted or denominated in shares of the Company’s common stock, as well as certain cash-based awards. At March 31, 2018, the Company had restricted stock awards, performance share units and performance units outstanding under the Omnibus Incentive Plan.

Restricted Stock Awards. The Company’s restricted stock awards are equity-classified awards and are valued based upon the market value of the Company’s common stock on the date of grant. Outstanding restricted shares will generally vest over either a three-year period or two and a half year period. The Company recognized total share-based compensation expense related to its restricted stock awards of $14.6 million and $3.6 million, of which $0.2 million and $0.5 million were capitalized, for the three-month periods ended March 31, 2018 and 2017, respectively. Share-based compensation expense for the three-month period ended March 31, 2018, includes $4.0 million for the accelerated vesting of 0.2 million restricted common stock awards and $7.8 million accrued for the accelerated vesting of 0.4 million restricted common stock awards processed in the second quarter of 2018, related to the Company’s reduction in force during the first quarter of 2018. The following table presents a summary of the Company’s unvested restricted stock awards:



	Number of Shares		Weighted Average Grant Date Fair Value
	(In thousands)
Unvested restricted shares outstanding at December 31, 2017	1,105		$	22.62
Granted	3		$	15.45
Vested	(228	)	$	22.96
Forfeited / Canceled	(17	)	$	21.39
Unvested restricted shares outstanding at March 31, 2018	863		$	22.53

As of March 31, 2018, the Company’s unrecognized compensation cost related to unvested restricted stock awards was $7.1 million. The remaining weighted-average contractual period over which this compensation cost may be recognized is 1.5 years. The aggregate intrinsic value of restricted stock that vested during the three months ended March 31, 2018 was approximately $3.4 million based on the stock price at the time of vesting.

Performance Share Units. In February 2017, the Company granted equity-classified awards in the form of performance share units, which will vest upon completion of the stated performance period from January 1, 2017 through June 30, 2019. The performance share units will be settled in shares of the Company’s common stock with one share of common stock being issued per performance share unit up to a maximum of approximately 0.4 million shares of common stock, provided the required performance measures are met. The shares are valued based on the Company’s performance relative to certain performance and market conditions. The Company recognized total share-based compensation expense related to its performance share units of $1.5 million, of which an insignificant amount was capitalized, for the three-month period ended March 31, 2018. Share-based compensation expense for the three-month period ended March 31, 2018, includes $0.4 million for the accelerated vesting of an insignificant amount of performance share units. Share-based compensation expense for the three-month period ended March 31, 2018, also includes $0.7 million accrued for the accelerated vesting of an insignificant amount of performance share units processed in the second quarter of 2018, related to the Company’s reduction in force during the first quarter of 2018. There was no significant activity related to the Company’s outstanding unvested performance share units during the three-month period ended March 31, 2017.

The following table presents a summary of the Company’s performance share units:



	Number of Units		Fair Value per Unit at March 31, 2018
	(In thousands)
Unvested performance share units outstanding at December 31, 2017	183
Granted	—
Vested	(36	)
Forfeited / Canceled	(3	)
Unvested performance share units outstanding at March 31, 2018	144		$	19.94	-	$	20.00

Incentive-Based Compensation

Performance Units. In October 2016, the Company granted liability-classified awards in the form of performance units which will vest over a three-year period and will be settled in cash, provided the required performance measures are met. The performance units were issued at a value of $100 each and the value at vesting will be determined by annual scorecard results. The Company recognized total incentive-based compensation expense related to its performance units of $3.5 million, of which an insignificant amount was capitalized, for the three-month period ended March 31, 2018. Incentive-based compensation expense for the three-month period ended March 31, 2018, includes $1.0 million for the accelerated vesting of an insignificant amount of performance units. Incentive-based compensation expense for the three-month period ended March 31, 2018, also includes $2.0 million accrued for the accelerated vesting of an insignificant amount of performance units processed in the second quarter of 2018, related to the Company’s reduction in force during the first quarter of 2018. At March 31, 2018, the liability related to performance units was $0.4 million. There was no significant activity related to the Company’s outstanding unvested performance units during the three-month period ended March 31, 2017. The following table presents a summary of the Company’s performance units:



	Number of Units		Fair Value per Unit at March 31, 2018
	(In thousands)
Unvested performance units outstanding at December 31, 2017	49
Granted	—
Vested	(10	)
Forfeited / Canceled	(1	)
Unvested performance units outstanding at March 31, 2018	38		$	100.00