Share Based Compensation

12 Months Ended

Dec. 31, 2020

Share-based Payment Arrangement [Abstract]

Omnibus Incentive Plan. The Omnibus Incentive Plan became effective on October 4, 2016 and authorizes the issuance of up to 4.6 million shares of SandRidge common stock.

Persons eligible to receive awards under the Omnibus Incentive Plan include non-employee directors of the Company, employees of the Company or any of its affiliates, and certain consultants and advisors 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 common stock, as well as certain cash-based awards. At December 31, 2020, the Company had restricted stock awards, restricted stock units, performance share units and stock options outstanding under the Omnibus Incentive Plan. Forfeitures for these awards are recognized as they occur.

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 at December 31, 2020 will generally vest over either a one-year period or three-year period with a remaining weighted average contractual period of 0.5 years and have $0.3 million of associated unrecognized compensation cost.

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, 2018	365	$	16.07
Granted	93	$	8.06
Vested	(210)	$	16.29
Forfeited / Canceled	(15)	$	16.25
Unvested restricted shares outstanding at December 31, 2019	233	$	12.66
Granted	105	$	2.15
Vested (1)	(174)	$	11.53
Forfeited / Canceled	(50)	$	15.97
Unvested restricted shares outstanding at December 31, 2020	114	$	3.26

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(1) The aggregate intrinsic value of restricted stock that vested during 2020 was approximately $0.2 million based on the stock price at the time of vesting.

Restricted Stock Units. The Company’s restricted stock units 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 stock units at December 31, 2020 will generally vest over a three-year period with a remaining weighted average contractual period of 2.42 years and have $1.2 million associated unrecognized compensation cost at year in December 31, 2020. Compensation expense was $0.3 million. The following table presents a summary of the Company's restricted stock units:


	Number of Units	Weighted- Average Grant Date Fair Value
	(In thousands)

Unvested restricted stock units outstanding at December 31, 2019	—	—
Granted	1,410	1.10
Unvested restricted stock units outstanding at December 31, 2020	1,410	$	1.10

Performance Share Units. In September 2018, the Company granted an immaterial number of additional performance share units. The vesting for the performance share units issued in 2018 was accelerated in connection with executive terminations in third quarter of 2020. In August 2020, the Company granted additional performance share units. Outstanding performance share units at December 31, 2020 will generally vest over a three year period with a remaining weighted average contractual period of 2.69 years and $0.3 million unrecognized compensation cost at year in December 31, 2020. Compensation expense was immaterial. The following table presents a summary of the Company's performance share units:


	Number of Units	Weighted- Average Grant Date Fair Value
	(In thousands)




Unvested performance share units outstanding at December 31, 2018	111	$	20.41

Vested	(19)	15.11

Unvested performance share units outstanding at December 31, 2019	92	20.41
Granted	205	1.66
Vested (1)	(92)	$	20.41

Unvested performance share units outstanding at December 31, 2020	205	$	1.66

(1) The aggregate intrinsic value of performance share units that vested during 2020 was approximately $0.1 million.

Stock Options

The fair value of stock options is estimated on the date of the grant using a Black-Scholes valuation model that uses the weighted average assumptions noted in the following table. Expected volatility is based on historical volatility of the Company’s common stock and other factors. The Company uses historical data on the exercise of stock options, post-vesting forfeitures and other factors to estimate the expected term of the stock-based payments granted. The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of grant. Generally, stock options granted to employees and

directors vest ratably over three years from the grant date and expire seven years from the date of grant.


Assumptions	For the Year Ended December 31, 2020
Risk-free interest rate	1.4	%
Expected dividend yield	—	%
Expected volatility	46.2	%
Expected term	2.75

The following table presents a summary of the Company's stock option activity for the year ended December 31, 2020:


	Number of Shares	Weighted Average Exercise Price per Share		Weighted Average Remaining Contractual Term(years)	Aggregate Intrinsic Value (in millions)
	(In thousands)




Outstanding at December 31, 2019	—	$	—	—	$	—
Granted	245	—


Forfeited / Canceled	(154)	—
Outstanding at December 31, 2020 (1)	91	$	—	2.68	$	0.24
Exercisable at December 31, 2020	—	$	—	—	$	—

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(1) All outstanding stock options as of December 31, 2020, are expected to vest.

In February 2020, the Company, granted nonqualified stock options. As of December 31, 2020, the total unrecognized compensation expense was immaterial and will be recognized over a weighted average period of 2.18 years. No options vested during the year ended December 31, 2020.

The following tables summarize the Company's share and incentive-based compensation for the years ended December 31, 2020 and 2019 (in thousands):


	Recurring Compensation Expense(1)		Executive Terminations(2)		Reduction in Force(2)		Accelerated Vesting(3)		Total
Year Ended December 31, 2020
Equity-classified awards:
Restricted stock awards and units	$	974	$	508	$	40	$	—	$	1,522
Performance share units	211		1,276		—		—		1,487
Stock options	22		—		—		—		22
Total share-based compensation expense	1,207		1,784		40		—		3,031



Less: Capitalized compensation expense	(19)		—		—		—		(19)
Share and incentive-based compensation expense, net	$	1,188	$	1,784	$	40	$	—	$	3,012
Year Ended December 31, 2019
Equity-classified awards:
Restricted stock awards	$	2,526	$	197	$	500	$	—	$	3,223
Performance share units	282		281		—		—		563
Stock options	661		12		—		—		673
Total share-based compensation expense	3,469		490		500		—		4,459



Less: Capitalized compensation expense	(204)		—		—		—		(204)
Share and incentive-based compensation expense, net	$	3,265	$	490	$	500	$	—	$	4,255

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(1)Recorded in general and administrative expense in the accompanying consolidated statements of operations.

(2)Recorded in employee termination benefits in the accompanying consolidated statements of operations.

(3)Recorded in accelerated vesting of employment compensation in the accompanying consolidated statements of operations.