In the W&T Offshore, Inc. Amended and Restated Incentive Compensation Plan (as amended from time to time, the “Plan”) was approved by our shareholders.  During and the Company granted restricted stock units (“RSUs”) under the Plan to certain of its employees.  RSUs are a long-term compensation component, and are subject to satisfaction of certain predetermined performance criteria and adjustments at the end of the applicable performance period based on the results achieved.  In addition to share-based awards, the Company grant to its employees cash-based incentive awards under the Plan, which be used as short-term and long-term compensation components of the awards, and are subject to satisfaction of certain predetermined performance criteria.

 

As of there were  shares of common stock available for issuance in satisfaction of awards under the Plan.  The shares available for issuance are reduced on a -for- basis when RSUs are settled in shares of common stock, which shares of common stock are issued net of withholding tax through the withholding of shares.  The Company has the option following vesting to settle RSUs in stock or cash, or a combination of stock and cash. The Company expects to settle RSUs that vest in the future using shares of common stock.

 

RSUs currently outstanding relate to the and  grants.  The  and  grants were subject to predetermined performance criteria applied against the applicable performance period.  All the RSUs currently outstanding are subject to employment-based criteria and vesting generally occurs in of the year after the grant.  See the table below for anticipated vesting by year.

 

We recognize compensation cost for share-based payments to employees over the period during which the recipient is required to provide service in exchange for the award.  Compensation cost is based on the fair value of the equity instrument on the date of grant.  The fair values for the RSUs granted during and were determined using the Company’s closing price on the grant date.  We also estimate forfeitures, resulting in the recognition of compensation cost only for those awards that are expected to actually vest.

 

All RSUs awarded are subject to forfeiture until vested and cannot be sold, transferred or otherwise disposed of during the restricted period.

 

A summary of activity related to RSUs during the  months ended  is as follows:

 

	Restricted Stock Units
			Weighted Average
			Grant Date Fair
	Units		Value Per Unit
Nonvested, December 31, 2019	1,614,722		$ 5.73
Forfeited	(22,645)		6.37
Nonvested, March 31, 2020	1,592,077		5.72

 

For the outstanding RSUs issued to the eligible employees as of vesting is expected to occur as follows (subject to forfeitures): 

 

	Restricted Stock Units
2020	803,995
2021	788,082
Total	1,592,077

 

 

  Under the W&T Offshore, Inc. Directors Compensation Plan (as amended from time to time, the “Director Compensation Plan”), shares of restricted stock (“Restricted Shares”) have been granted to the Company’s non-employee directors.  Grants to non-employee directors were made during and   As of there were  shares of common stock available for issuance in satisfaction of awards under the Director Compensation Plan.  During the quarter of our shareholders approved increasing the shares available by  shares.  During the quarter of Restricted Shares were granted to non-employee directors.  The shares available are reduced on a -to- basis when Restricted Shares are granted.

 

We recognize compensation cost for share-based payments to non-employee directors over the period during which the recipient is required to provide service in exchange for the award.  Compensation cost is based on the fair value of the equity instrument on the date of grant.  The fair values for the Restricted Shares granted were determined using the Company’s closing price on the grant date.  forfeitures were estimated for the non-employee directors’ awards.

 

The Restricted Shares are subject to service conditions and vesting occurs at the end of specified service periods unless otherwise approved by the Board of Directors.  Restricted Shares cannot be sold, transferred or disposed of during the restricted period.  The holders of Restricted Shares generally have the same rights as a shareholder of the Company with respect to such Restricted Shares, including the right to vote and receive dividends or other distributions paid with respect to the Restricted Shares.

 

There was  activity related to Restricted Shares during the  months ended

 

For the outstanding Restricted Shares issued to the non-employee directors as of vesting is expected to occur as follows (subject to any forfeitures):

 

 

	Restricted Shares
2020	78,424
2021	29,300
2022	15,456
Total	123,180

 

 

Share-based compensation expense is recorded in the line s in the Condensed Consolidated Statements of Operations.  The tax benefit related to compensation expense recognized under share-based payment arrangements was meaningful and was minimal due to our income tax situation.  A summary of incentive compensation expense under share-based payment arrangements is as follows (in thousands):

 

 

		Three Months Ended March 31,
		2020				2019
Share-based compensation expense from:
Restricted stock units (1)		$	978			$	(148	)
Restricted Shares			70				70
Total		$	1,048			$	(78	)

 

 

 

As of unrecognized share-based compensation expense related to our awards of RSUs and Restricted Shares was  million and  million, respectively.  Unrecognized share-based compensation expense will be recognized through for RSUs and for Restricted Shares.

 

In addition to share-based compensation, short-term, cash-based awards were granted under the Plan to substantially all eligible employees in and   The short-term, cash-based awards, which are generally a short-term component of the Plan, are performance-based awards consisting of or more business criteria or individual performance criteria and a targeted level or levels of performance with respect to each of such criteria.  In addition, these cash-based awards included an additional financial condition requiring Adjusted EBITDA less reported Interest Expense Incurred (terms as defined in the awards) for any fiscal quarter plus the preceding quarters to exceed defined levels measured over defined time periods for each cash-based award.  During long-term, cash awards were granted to certain employees subject to pre-defined performance criteria.  Expense is recognized over the service period once the business criteria, individual performance criteria and financial condition are met.

 

 

 

 

 

 

 

A summary of compensation expense related to share-based awards and cash-based awards is as follows (in thousands):

 

		Three Months Ended March 31,
		2020				2019
Share-based compensation included in:
General and administrative expenses		$	1,048			$	(78	)
Cash-based incentive compensation included in:
Lease operating expense (1)			849				(123	)
General and administrative expenses (1)			3,631				2,095
Total charged to operating income		$	5,528			$	1,894