Chord Energy CorpCHRD
Chord Energy Corp Stock Compensation Disclosure
Equity-Based Compensation
The Company has granted equity-based compensation awards under the 2020 LTIP. In accordance with the FASB’s authoritative guidance for share-based payments, the Company accounts for awards that settle in shares of common stock as equity-classified awards and awards that settle in cash as liability-classified awards.
Equity-based compensation expense is recognized in general and administrative expenses on the Company’s Consolidated Statements of Operations. The Company recognized $25.7 million, $23.0 million and $46.1 million in equity-based compensation expenses related to equity-classified awards during the years ended December 31, 2025, 2024 and 2023, respectively. Equity-based compensation expenses related to liability-classified awards were $1.0 million, $1.0 million and $3.4 million during the years ended December 31, 2025, 2024 and 2023, respectively.
Restricted stock units. The Company has granted restricted stock units (“RSUs”) to employees and non-employee directors. RSUs are contingent shares with a service-based vesting condition. The RSUs granted to employees vest following a graded vesting schedule and vest ratably each year over a three-year or four-year period. The RSUs granted to non-employee directors vest over a one-year period. The fair value is based on the closing price of the Company’s common stock on the date of grant or, if applicable, the date of modification. The Company recognizes compensation expense under the straight-line method over the requisite service period.
The following table summarizes information related to RSUs held by employees and non-employee directors of the Company:
| Shares | Weighted Average Grant Date Fair Value per Share | ||||||||||
Non-vested shares outstanding December 31, 2024 | 284,222 | $ | 137.23 | ||||||||
| Granted | 201,594 | 118.16 | |||||||||
| Vested | (137,205) | 122.45 | |||||||||
| Forfeited | (24,972) | 135.41 | |||||||||
Non-vested shares outstanding December 31, 2025 | 323,639 | $ | 131.91 | ||||||||
The fair value of awards vested was $14.9 million and $23.2 million for the years ended December 31, 2025 and 2024, respectively. The weighted average grant date fair value of RSUs was $118.16 per share and $161.23 per share for the years ended December 31, 2025 and 2024, respectively. Unrecognized expense as of December 31, 2025 for all outstanding RSUs was $23.8 million and will be recognized over a weighted average period of approximately 1.6 years.
Performance share units. During the years ended December 31, 2025 and 2024, the Company granted performance share units to certain employees that include (i) total stockholder return (“TSR”) performance share units (“Absolute TSR PSUs”) and (ii) relative TSR PSUs (“Relative TSR PSUs” and collectively with the Absolute TSR PSUs, the “PSUs”), which are eligible to vest and become earned at the end of the applicable performance period, subject to the level of achievement with respect to certain performance goals.
The Absolute TSR PSUs are subject to time-based service requirements and market conditions based on the TSR achieved by the Company during the performance period. Depending on the Company’s TSR, award recipients may earn between 0% and 300% of the target number of Absolute TSR PSUs originally granted.
The Relative TSR PSUs are subject to time-based service requirements and market conditions based on a comparison of the TSR achieved by the Company against the TSR achieved by the members of a defined peer group at the end of the performance period. Depending on the Company’s TSR performance relative to the TSR performance of the members of the defined peer group, award recipients may earn between 0% and 200% of the target number of Relative TSR PSUs originally granted.
Any earned PSUs will be settled in shares of the Company’s common stock for up to 100% of the target number of PSUs subject to each applicable award, with any remaining earned PSUs that exceed the target number of PSUs subject to the award being settled in cash based on the fair market value of a share of the Company’s common stock on the applicable payment date.
The PSUs are bifurcated and classified as equity-based and liability-based awards based on the probability of achieving various target performance thresholds.
The following table summarizes information related to the Absolute TSR PSUs held by employees of the Company:
| Shares | Weighted Average Grant Date Fair Value per Share | ||||||||||
Non-vested shares outstanding December 31, 2024 | 15,444 | $ | 233.00 | ||||||||
| Granted | 24,730 | 170.38 | |||||||||
| Vested | — | — | |||||||||
| Forfeited | (1,878) | 205.77 | |||||||||
Non-vested shares outstanding December 31, 2025 | 38,296 | $ | 193.90 | ||||||||
There were no vested awards during the year ended December 31, 2025. The fair value of awards vested was $0.1 million for the year ended December 31, 2024. Unrecognized expense as of December 31, 2025 for all outstanding Absolute TSR PSUs was $2.3 million and will be recognized over a weighted average period of 1.8 years.
The following table summarizes information related to the Relative TSR PSUs held by employees of the Company:
| Shares | Weighted Average Grant Date Fair Value per Share | ||||||||||
Non-vested shares outstanding December 31, 2024 | 46,337 | $ | 197.02 | ||||||||
| Granted | 74,219 | 136.18 | |||||||||
| Vested | — | — | |||||||||
| Forfeited | (5,639) | 162.96 | |||||||||
Non-vested shares outstanding December 31, 2025 | 114,917 | $ | 159.40 | ||||||||
There were no vested awards during the year ended December 31, 2025. The fair value of awards vested was $0.2 million for the year ended December 31, 2024. Unrecognized expense as of December 31, 2025 for all outstanding Relative TSR PSUs was $7.4 million and will be recognized over a weighted average period of 1.7 years.
Fair value assumptions. The aggregate grant date fair value of the PSUs was determined by a third-party valuation specialist using a Monte Carlo simulation model. The key valuation inputs were: (i) the forecast period, (ii) risk-free interest rate, (iii) implied equity volatility and (iv) stock price on the date of grant. The risk-free interest rates are the U.S. Treasury bond rates on the date of grant that correspond to each performance period. Implied equity volatility is derived by solving for an asset volatility and equity volatility based on the leverage of the Company and each of its peers.
The following table summarizes the assumptions used in the Monte Carlo simulation model to determine the grant date fair value and associated equity-based compensation expenses by grant date:
| Absolute and Relative TSR PSUs | |||||||||||||||||
| Year Ended December 31, 2025 | Year Ended December 31, 2024 | ||||||||||||||||
| Forecast period (years) | 3 | 3 | |||||||||||||||
| Risk-free interest rates | 4.3% | 3.8% | — | 4.7% | |||||||||||||
| Implied equity volatility | 33% | 35% | |||||||||||||||
| Range of stock price on date of grant | $122.11 | $141.41 | — | $169.66 | |||||||||||||
Phantom unit awards. The Company granted phantom unit awards to certain employees. Phantom unit awards represent the right to receive, upon vesting of the award, a cash payment equal to the fair market value of one share of common stock. The phantom unit awards are subject to a service-based vesting condition and generally vest in equal installments each year over a three-year period from the date of grant. Compensation expense is recognized over the requisite service period.
The following table summarizes information related to phantom unit awards held by employees of the Company:
| Phantom Unit Awards | Weighted Average Grant Date Fair Value per Share | ||||||||||
Non-vested phantom unit awards outstanding December 31, 2024 | 18,087 | $ | 151.71 | ||||||||
| Granted | 12,079 | 121.46 | |||||||||
| Vested | (6,859) | (148.04) | |||||||||
| Forfeited | (2,009) | (136.06) | |||||||||
Non-vested phantom unit awards outstanding December 31, 2025 | 21,298 | $ | 136.05 | ||||||||
The fair value of vested phantom unit awards was $0.8 million and $0.6 million for the years ended December 31, 2025 and 2024, respectively. Unrecognized expense as of December 31, 2025 for all outstanding phantom unit awards was $1.1 million and will be recognized over a weighted average period of approximately 1.7 years.
Legacy awards. The Company previously granted performance share units (“Legacy PSUs”) and leveraged stock units (“LSUs”) to certain employees. These awards were contingent shares that could be earned over a three-year or four-year performance period subject to market-based and service-based vesting conditions. The completion of the Merger represented a “change in control” such that such awards earned by award recipients were subject to a service-based vesting condition.
As of December 31, 2024, these Legacy PSUs were fully vested and the fair value of the awards vested was $9.0 million for the year ended December 31, 2024.
As of December 31, 2025, these LSUs were fully vested and the fair value of the awards vested was $27.2 million and $42.3 million for the years ended December 31, 2025 and 2024, respectively.Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 26, 2026 | Showing above |
| 2020 | Mar 8, 2021 | |
About Stock Compensation Disclosures
Stock-based compensation disclosures detail the equity awards granted to employees and executives — including stock options, restricted stock units (RSUs), and performance shares — along with the valuation methods and assumptions used to expense them. This section reveals the true cost of talent retention and the alignment between management incentives and shareholder interests.
Key signals: total unrecognized compensation expense and its expected recognition period signal future earnings headwinds from already-granted awards. For stock options, examine Black-Scholes assumptions — expected volatility, risk-free rate, and expected term — as understating any of these reduces reported compensation expense. Compare stock compensation expense as a percentage of revenue against peers to assess dilution cost. Watch vesting schedules for acceleration clauses tied to change-of-control events. Performance-based awards with undemanding targets may indicate weak governance. Add back stock compensation to operating cash flow to calculate a more conservative free cash flow figure.