Stock-Based Compensation Plans

9 Months Ended

Sep. 30, 2012

Stock-Based Compensation Plans [Abstract]

Stock-Based Compensation Plans

Note 11 – Employee Benefit Plans

We have two stock-based compensation plans: the 1995 Long-Term Incentive Plan, as amended (the “1995 Incentive Plan”) and the 2005 Long-Term Incentive Plan, as amended (the “2005 Incentive Plan”).  In May 2012, the shareholders approved an amendment to and restatement of the 2005 Incentive Plan to: (i) authorize 4.3  million additional shares for issuance pursuant to our equity incentive compensation strategy, (ii) authorize incentive stock options, stock appreciation rights, cash awards and performance awards to be made pursuant to the amended and restated 2005 Incentive Plan, and (iii) include performance criteria for awards that may be made contingent upon the achievement of one or more performance measures, as well as limits on individual awards, in accordance with the requirements for performance-based compensation under Section 162(m) of the Internal Revenue Code.  As of September 30, 2012, there were 6.7 million shares available for issuance under the amended and restated 2005 IncentivePlan, which includes a maximum of 2.0 million shares that may be granted as incentive stock options. There were no stock option grants in the three- and nine-month periods ended September 30, 2012 and 2011.During the nine-month period ended September 30, 2012, the following grants of share-based awards (restricted shares, restricted stock units and performance share units (“PSUs”)) were made to executive officers, selected management employees and non-employee members of ourBoard of Directors under the amended and restated 2005 Incentive Plan:

Date of Grant	Shares		Grant Date Fair Value Per Share	Vesting Period
January 3, 2012...................................	272,153	$	15.80	33% per year over three years
January 3, 2012(1)............................	132,910		23.68	100% on January 1, 2015
January 3, 2012...................................	1,958		15.80	100% on January 1, 2014
April 1, 2012...........................................	1,879		17.80	100% on January 1, 2014
July 2, 2012...........................................	1,885		16.41	100% on January 1, 2014
August 23, 2012...................................	3,539		18.84	20% per year over five years

(1) Reflects the grant of PSUs to certain of our executive officers.  The estimated fair value of the PSUs on grant date was determined using a Monte Carlo simulation model.  The PSUs provide for an award based on the performance of our common stock over a three-year period with the maximum award being 200% of the original awarded PSUs and the minimum amount being zero.  The vested PSUs will be settled in an equivalent number of shares of our common stock unless the Compensation Committee of our Board of Directors elects to pay in cash.  See Note 12 of 2011 Form 10-K.

Compensation cost is recognized over the respective vesting periods on a straight-line basis.  For the three- and nine-month periods ended September 30, 2012,$1.8 million and $5.5  million, respectively,were recognized as compensation expense related to share-based awards as compared with $1.9 million and $6.8 million during the three- and nine-month periods ended September 30, 2011. 

Long-Term Incentive Compensation Plan

In January 2009, we adopted the 2009 Long-Term Incentive Cash Plan (the “2009 LTI Plan”) to provide long-term cash-based compensation to eligible employees.  Under the terms of the 2009 LTI Plan, the majority of the cash awards are fixed sum amounts payable (the vesting period is five years for awards granted before January 1, 2012 and three years thereafter).  However, some of the cash awards are indexed to our common stock and the payment amount at each vesting date will fluctuate based on the performanceof our common stock.  This share-based component is considered a liability plan and as such is re-measured to fair value each reporting period with corresponding changes being recorded as a charge to earnings as deemed appropriate. 

The awards made under the 2009 LTI Plan totaled $4.2  million in 2012 and $5.2 million in 2011.   Total compensation expense associated with the 2009 LTI Plan was$2.5 million and $6.1 million, respectively,for the three- and nine-month periods ended September 30, 2012.  For the three- and nine-month periods ended September 30, 2011, compensation expense under the 2009 LTI Plan totaled $0.4 million and $5.0 million, respectively.  The liability balance under the 2009 LTI Plan was $10.5 million at September 30, 2012 and $9.9 million at December 31, 2011, including $9.5 million atSeptember 30, 2012 and $8.5 million at December 31, 2011 associated with the variable portion of the 2009 LTI plan. 

Employee Stock Purchase Plan

In May 2012, the shareholders approved the Helix Energy Solutions Group, Inc. Employee Stock Purchase Plan (the “ESPP”).  The ESPP has 1.5 million shares authorized for issuance.  Eligible employees who participate in the ESPP may purchase shares of our common stock through payroll deductions on an after tax basis over a four-month period beginning on January 1, May 1, and September 1 of each year during the term of the ESPP, subject to certain restrictions and limitations established by the Compensation Committee of our Board of Directors (which administers the ESPP) and Section 423 of the Internal Revenue Code.  The per share price of common stock purchased under the ESPP is equal to85% of the lesser of (i) its fair market value on the first trading day of the purchase period or (ii) its fair market value on the last trading day of the purchase period.  The first purchase period under the ESPP began on September 1, 2012.  Share-based compensation expense with respect to the ESPP was $0.1 million for the three- and nine-month periods ended September 30, 2012.

For more information regarding our employee benefit plans, including our stock-based compensation plans and our 2009 LTI Plan, see Note 12 of our 2011 Form 10-K.