Share-Based Compensation and Other Benefit Plans
|3 Months Ended|
Mar. 31, 2022
|Share-based Payment Arrangement [Abstract]|
|Share-Based Compensation and Other Benefit Plans||
Note 12 – Share-Based Compensation and Other Benefit Plans
We reserved 4,424,600 shares of Class A Common Stock for issuance under the Ranger Oil Management Incentive Plan (the “Plan”) for share-based compensation awards. A total of 762,259 RSUs and 484,197 PRSUs have been granted to employees and directors through March 31, 2022.
We recognized expense attributable to the RSUs and PRSUs of $0.9 million for the three months ended March 31, 2022 and $2.2 million, including approximately $1.9 million as a result of a change-in-control event associated with the Juniper Transactions for the three months ended March 31, 2021. We recognize share-based compensation expense as a component of G&A expenses in our condensed consolidated statements of operations.
Time-Vested Restricted Stock Units
The table below summarizes activity for the three months ended March 31, 2022 with respect to awarded RSUs:
Compensation expense for RSUs is recognized on a straight-line basis over the applicable vesting period, which is generally over a three-year period. As of March 31, 2022, we had $1.2 million of unrecognized compensation cost attributable to RSUs. We expect that cost to be recognized over a weighted-average period of 1.71 years.
Performance-Based Restricted Stock Units
During the three months ended March 31, 2022, we did not have any activity with respect to the PRSUs. As of March 31, 2022, a total of 345,069 PRSUs were unvested and outstanding.
Compensation expense for PRSUs with a market condition is being charged to expense on a straight-line basis for the 2021 grants and graded-vesting for the 2020 and 2019 grants, over a range of less than to three years. Compensation expense for PRSUs with a performance condition is recognized on a straight-line basis over three years when it is considered probable that the performance condition will be achieved and such grants are expected to vest. PRSUs with a market condition do not allow for the reversal of previously recognized expense, even if the market condition is not achieved and no shares ultimately vest.
The 2021 PRSU grants are based 50% on the Company’s return on average capital employed (“ROCE”) relative to a defined peer group and 50% based on the Company’s absolute total shareholder return and total shareholder return (“TSR”) relative to a defined peer group over the three-year performance period. The 2021 PRSUs cliff vest from 0% to 200% of the original grant at the end of a three-year performance period based on satisfaction of the respective underlying conditions.
Vesting of PRSUs granted in 2020 and 2019 range from 0% to 200% of the original grant based on TSR relative to a defined peer group over the three year performance period. As TSR is deemed a “market condition”, the grant-date fair value for the 2019, 2020 and a portion of the 2021 grants is derived by using a Monte Carlo model. The ranges for the assumptions used in the Monte Carlo model for the PRSUs granted during 2021, 2020 and 2019 are presented as follows:
1 One executive officer’s inducement award originally granted in August 2020 was amended in April 2021 to conform vesting conditions to other PRSU awards granted in 2021. The Monte Carlo assumptions for both years are included above.
As of March 31, 2022, we had $3.9 million of unrecognized compensation cost attributable to PRSUs. We expect that cost to be recognized over a weighted-average period of 1.94 years.
Other Benefit Plans
We maintain the Penn Virginia Corporation and Affiliated Companies Employees 401(k) Plan (the “401(k) Plan”), a defined contribution plan, which covers substantially all of our employees. We recognized $0.2 million of expense attributable to the 401(k) Plan for both the three months ended March 31, 2022 and 2021. The charges for the 401(k) Plan are recorded as a component of G&A expenses in our condensed consolidated statements of operations.
We maintain unqualified legacy defined benefit pension and defined benefit postretirement plans that cover a limited number of former employees, all of whom retired prior to January 1, 2000. The combined expense recognized with respect to these plans was less than $0.1 million for each of the three and three months ended March 31, 2022 and 2021. The charges for these plans are recorded as a component of Other income (expense) in our condensed consolidated statements of operations.
The entire disclosure for share-based payment arrangement.
Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef