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Long-Term Incentive Plans | 9 Months Ended
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Sep. 30, 2024
Long-Term Incentive Plans |
Long-Term Incentive Plans | Note 10. Long-Term Incentive Plans On May 15, 2024, the Company’s shareholders approved the Amplify Energy Corp. 2024 Equity Incentive Plan (the “2024 EIP”), which had previously been approved by the board of directors of the Company. No further awards will be granted under the prior Legacy Equity Incentive Plan (“EIP,” and together with the 2024 EIP, the “EIP Plans”). The 2024 EIP provides for awards that can be granted in the form of nonqualified stock options, incentive stock options, restricted stock awards, restricted stock units, stock appreciation rights, performance awards, stock awards and other incentive awards. To the extent that an award, other than stock options or stock appreciation rights, under the 2024 EIP has expired or been forfeited or canceled for any reason without having been exercised in full, the unexercised award would then be available again for future grants under the 2024 EIP. The 2024 EIP is administered by the board of directors of the Company. Restricted Stock Units Restricted Stock Units with Service Vesting Condition Restricted stock units with service vesting conditions (“TSUs”) are accounted for as either equity-classified awards or liability-classified awards. The grant-date fair value is recognized as compensation cost on a straight-line basis over the requisite service period and forfeitures are accounted for as they occur. The Company considered its intent and ability to settle awards in cash or shares of stock in determining whether to classify the awards as equity or liability awards. Compensation costs for equity-classified awards are recorded as general and administrative expense. The fair value of liability-classified awards is determined on a quarterly basis beginning at the grant date until final vesting. Changes in the fair value of liability-classified awards are recorded to general administrative expense and are remeasured at fair value each reporting period. In February 2024, the Company granted contingent cash-settlement awards in the form of TSUs (the “2024 TSUs”). In May 2024, the Company received shareholder approval of the 2024 EIP, which removed the contingent consideration around the 2024 TSUs. As of June 30, 2024, the 2024 TSUs were reclassified as equity awards. The compensation cost related to these awards is determined by the fair value of the award on the modification date. The 2024 TSUs will vest in substantially equal installments over a three-year period. The unrecognized cost associated with the TSUs was $6.6 million at September 30, 2024. The Company expects to recognize the unrecognized compensation cost for these awards over a weighted average period of approximately 2.0 years. The following table summarizes information regarding the TSUs activity for the period presented: ​
​ | ​ | ​ | ​ | ​ | ​
​ |  | ​ |  | Weighted-
​ | ​ | ​ | ​ | Average Grant-
​ | ​ | Number of | ​ | Date Fair Value
​ | ​ | Units | ​ | per Unit (1)
TSUs outstanding at December 31, 2023 |  | 1,331,456 | ​ | $ | 5.77
Granted (2) |  | 851,456 | ​ | $ | 6.37
Forfeited |  | (5,922) | ​ | $ | 5.04
Vested |  | (796,854) | ​ | $ | 5.29
TSUs outstanding at September 30, 2024 |  | 1,380,136 | ​ | $ | 6.42
| (1) | Determined by dividing the aggregate grant-date fair value of awards by the number of awards issued.
| (2) | The aggregate grant-date fair value of TSUs issued for the nine months ended September 30, 2024 was $5.4 million based on a grant-date market price ranging from $6.26 per share to $6.72 per share.
Restricted Stock Units with Market and Service Vesting Conditions Restricted stock units with market and service vesting conditions (“PSUs”) are accounted for as either equity-classified or liability-classified awards. The grant-date fair value is recognized as compensation cost on a graded-vesting basis. The fair value of the awards is estimated on their grant dates using a Monte Carlo simulation. The Company recognizes compensation cost over the requisite service or performance period. The Company accounts for forfeitures as they occur. Vesting of PSUs can range from 0% to 200% of the target awards granted based on the Company’s relative total shareholder return as compared to the total shareholder return of the Company’s performance peer group over the applicable performance period. The 2022 and 2023 PSU awards are accounted for as equity-classified awards and were issued with a three-year vesting period beginning on the grant date and ending on the third anniversary of the grant date. The three-year performance period for the 2022 awards is January 1, 2022 through December 31, 2024. The three-year performance period for the 2023 awards is January 1, 2023 through December 31, 2025. In February 2024, the Company granted contingent cash-settlement awards in the form of PSUs (the “2024 PSUs”). In May 2024, the Company received shareholder approval of the 2024 EIP, which removed the contingent consideration around the 2024 PSUs. As of June 30, 2024, the 2024 PSUs were reclassified as equity awards with a three-year vesting period. The compensation cost related to these awards is determined by the fair value of the award on the modification date. The three-year performance period for the 2024 PSUs is January 1, 2024 through December 31, 2026. Compensation costs related to PSU awards are recorded as general and administrative expense. The unrecognized cost associated with PSU awards was $3.3 million at September 30, 2024. The Company expects to recognize the unrecognized compensation cost for PSU awards over a weighted-average period of approximately 1.9 years. The below table reflects the ranges for the assumptions used in the Monte Carlo model for the 2024 PSUs: ​
​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Date of Grant: February 2024 | ​ | ​ | Modification Date: May 2024 | ​
Expected volatility | ​ | 75.8 | % | ​ | 63.2 | %
Dividend yield | ​ | 0.00 | % | ​ | 0.00 | %
Risk-free interest rate | ​ | 4.19 | % | ​ | 4.72 | %
​ The following table summarizes information regarding the PSU activity for the period presented: ​
​ | ​ | ​ | ​ | ​ | ​
​ |  | ​ |  | Weighted-
​ | ​ | ​ | ​ | Average Grant-
​ | ​ | Number of | ​ | Date Fair Value
​ | ​ | Units | ​ | per Unit (1)
PSUs outstanding at December 31, 2023 |  | 402,701 | ​ | $ | 9.31
Granted (2) |  | 312,843 | ​ | $ | 7.55
Forfeited |  | — | ​ | $ | —
Vested |  | (107,044) | ​ | $ | 2.63
PSUs outstanding at September 30, 2024 |  | 608,500 | ​ | $ | 9.58
| (1) | Determined by dividing the aggregate grant-date fair value of awards by the number of awards issued.
| (2) | The aggregate grant-date fair value of PSUs issued for the nine months ended September 30, 2024 was $2.4 million based on a calculated fair value price ranging from $2.63 to $8.33 per share.
Compensation Expense The following table summarizes the amount of recognized compensation expense associated with the EIP Plans, which are reflected in the accompanying Unaudited Condensed Consolidated Statements of Operations for the periods presented (in thousands): ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | For the Three Months Ended |  | For the Nine Months Ended
​ | ​ | September 30, | ​ | September 30,
​ | ​ | 2024 | ​ | 2023 | ​ | 2024 | ​ | 2023
Share-based compensation costs | ​ |  | ​ | ​ |  | ​ | ​ |  | ​ | ​ |  | ​
TSUs | ​ | $ | 1,322 | ​ | $ | 1,027 | ​ | $ | 3,685 | ​ | $ | 2,965
PSUs | ​ |  | 494 | ​ |  | 300 | ​ |  | 1,428 | ​ |  | 643
​ | ​ | $ | 1,816 | ​ | $ | 1,327 | ​ | $ | 5,113 | ​ | $ | 3,608
​

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