XML 42 R23.htm IDEA: XBRL DOCUMENT v3.3.1.900
EMPLOYEE BENEFIT PLANS
12 Months Ended
Dec. 31, 2015
Compensation Related Costs [Abstract]  
EMPLOYEE BENEFIT PLANS
EMPLOYEE BENEFIT PLANS:
We have entered into deferred compensation and disability agreements with certain of our current and former officers. The benefits under the deferred compensation agreements vest after certain periods of employment, and at December 31, 2015, the liability for such vested benefits was approximately $1,125 and is recorded in current and other long-term liabilities.
The following is a brief description of each incentive compensation plan applicable to our employees:
Annual Cash Incentive Compensation Plan
The Amended and Restated Revised Annual Incentive Compensation Plan, which was adopted in November 2007, provides for annual cash incentive bonuses that are tied to the achievement of certain strategic objectives as defined by our board of directors on an annual basis. Stone incurred expenses of $2,242, $10,361, and $15,340, net of amounts capitalized, for each of the years ended December 31, 2015, 2014 and 2013, respectively, related to incentive compensation bonuses to be paid under the revised plan.
Stock Incentive Plans
We currently maintain the Stone Energy Corporation 2009 Amended and Restated Stock Incentive Plan, as amended from time to time (the “2009 Plan”). The 2009 Plan was originally approved at the 2009 Annual Meeting of Stockholders and is an amendment and restatement of the company’s 2004 Amended and Restated Stock Incentive Plan (the “2004 Plan”), and it supersedes and replaces in its entirety the 2004 Plan. The 2009 Plan provides for the granting of (a) “incentive” stock options as defined in Section 422 of the Code, (b) stock options that do not constitute incentive stock options (“non-statutory” stock options), (c) stock appreciation rights in conjunction with an incentive or non-statutory stock option, (d) restricted stock, (e) restricted stock units, (f) dividend equivalents, (g) other stock-based awards, (h) conversion awards, and (i) cash awards, any of which may be further designated as performance awards (collectively referred to as “awards”). The 2009 Plan eliminated the automatic grant of stock options or restricted stock awards to nonemployee directors that was provided for in the 2004 Plan so that awards under the 2009 Plan are entirely at the discretion of our board of directors or a designated committee. All options must have an exercise price of not less than the fair market value of our common stock on the date of grant and may not be re-priced without stockholder approval.

At the 2015 Annual Meeting of Stockholders, the stockholders approved the Second Amendment (the “Second Amendment”) to the 2009 Plan and the Third Amendment (the "Third Amendment") to the 2009 Plan. The Second Amendment provides, among other things, for an increase in the number of shares of our common stock reserved for issuance under the 2009 Plan by 1,600,000 shares, effective May 21, 2015, and for an extension of the term of the 2009 Plan to May 21, 2025. The Third Amendment sets forth the material terms of the 2009 Plan (i.e., the eligible employees, business criteria and maximum annual per person compensation limits) for purposes of complying with certain requirements of Section 162(m) of the Internal Revenue Code. The Third Amendment does not change the employees eligible to receive compensation under the 2009 Plan, but does (i) allow Stone to grant cash awards (which may or may not be designated as performance awards) under the 2009 Plan, (ii) impose a fixed share number limit on stock-based awards and a fixed dollar limit on cash awards granted during any calendar year under the 2009 Plan to certain individuals, and (iii) add additional business criteria that may be utilized in setting performance goals under the 2009 Plan. The Third Amendment also became effective as of May 21, 2015. On December 17, 2015, Stone amended and restated the 2009 Plan to incorporate all prior amendments to the 2009 Plan (including the Second Amendment and the Third Amendment) and certain other non-material changes to the 2009 Plan.
At December 31, 2015, we had approximately 2,082,434 additional shares available for issuance pursuant to the 2009 Plan.
401(k) and Deferred Compensation Plans
The Stone Energy 401(k) Profit Sharing Plan provides eligible employees with the option to defer receipt of a portion of their compensation and we may, at our discretion, match a portion or all of the employee’s deferral. The amounts held under the plan are invested in various investment funds maintained by a third party in accordance with the direction of each employee. An employee is 20% vested in matching contributions (if any) for each year of service and is fully vested upon five years of service. For the years ended December 31, 2015, 2014 and 2013, Stone contributed $1,553, $1,989 and $1,793, respectively, to the plan.
The Stone Energy Corporation Deferred Compensation Plan provides eligible executives and employees with the option to defer up to 100% of their eligible compensation for a calendar year and we may, at our discretion, match a portion or all of the participant’s deferral based upon a percentage determined by our board of directors. In addition, the Board may elect to make discretionary profit sharing contributions to the plan. To date there have been no matching or discretionary profit sharing contributions made by Stone. The amounts held under the plan are invested in various investment funds maintained by a third party in accordance with the direction of each participant. At December 31, 2015 and 2014, plan assets of $8,499 and $8,425, respectively, were included in other assets. An equal amount of plan liabilities were included in other long-term liabilities.
Change of Control and Severance Plans
On April 7, 2009, we amended and restated our Executive Change of Control and Severance Plan effective as of December 31, 2008 (as so amended and restated, the “Executive Plan”). The Executive Plan also replaced and superseded our Executive Change in Control and Severance Policy that was maintained for certain designated executives (specifically, the CEO and CFO). The Executive Plan will provide the company’s officers that are terminated in the event of a change of control and upon certain other terminations of employment with change of control and severance benefits as defined in the Executive Plan. Although our CEO does not currently participate in the Executive Plan, the severance benefits provided to him under his employee agreement are substantially similar to the benefits provided under the Executive Plan. Executives who are terminated within the scope of the Executive Plan will be entitled to certain payments and benefits including the following: (i) any unpaid base salary up to the date of termination; (ii) in the case of the CEO and CFO, a lump sum severance payment of 2.99 times the sum of the executive’s annual base salary and any target bonus at the one hundred percent level; (iii) a lump sum amount representing a pro rata share of the bonus opportunity up to the date of termination at the then projected rate of payout; (iv) in the case of officers other than the CEO and CFO and an involuntary termination occurring outside a change of control period, a lump sum severance payment in an amount equal to the executive’s annual base salary; (v) in the case of officers other than the CEO and CFO and an involuntary termination occurring during a change of control period, a lump sum severance payment in an amount equal to 2.99 times the executive’s annual base salary; (vi) continued health plan coverage for six months and outplacement services. In the case of the CEO and CFO, if the payments would be “excess parachute payments,” the CEO and CFO may receive a potential gross-up payment to reimburse them for excise taxes that might be incurred under Section 4999 of the Internal Revenue Code of 1986, as amended (the “Code”), as well as any additional income taxes resulting from such reimbursement, provided that if it shall be determined that the executive is entitled to a gross-up payment but the total to be paid does not exceed 110% of the greatest amount (the “Reduced Amount”) that could be paid such that receipt of the total would not give rise to any excise tax, then no gross-up will be paid and the total payments to the executive will be reduced to the Reduced Amount. Also, if a payment would be to a “specified employee” for purposes of Section 409A of the Code, payment will be delayed until six months after his termination if required to comply with Section 409A. Benefits paid upon a change of control, without regard to whether there is a termination of employment, include the following: (i) lapse of restrictions on restricted stock, (ii) accelerated vesting and cash-out of all in-the-money stock options, (iii) a 401(k) plan employer matching contribution at the rate of 50%, and (iv) a pro-rated portion of the projected bonus, if any, for the year of change of control.
On December 7, 2007, our board of directors approved and adopted the Stone Energy Corporation Employee Change of Control Severance Plan (“Employee Severance Plan”), as amended and restated to comply with the final regulations under Section 409A of the Code and to provide that said plan will remain in force and effect unless and until terminated by our board of directors. The Employee Severance Plan amended and restated the company’s previous Employee Change of Control Severance Plan dated November 16, 2006. The Employee Severance Plan covers all full-time employees other than officers. Severance is triggered by an involuntary termination of employment on and during the six-month period following a change of control, including a resignation by the employee relating to a change in duties. Employees who are terminated within the scope of the Employee Severance Plan will be entitled to certain payments and benefits including the following: (i) a lump sum equal to (1) weekly pay times full years of service, plus (2) one week’s pay for each full $10,000 of annual pay, but the sum of (1) and (2) cannot be less than 12 weeks of pay or greater than 52 weeks of pay; (ii) continued health plan coverage for 6 months; (iii) a pro-rated portion of the employee’s targeted bonus for the year, and (iv) reasonable outplacement services consistent with current HR practices. Benefits paid upon a change of control, without regard to whether there is a termination of employment, include the following: (i) lapse of restrictions on restricted stock, (ii) cash-out of in-the-money stock options, (iii) a 401(k) plan employer matching contribution at the rate of 50%, and (iv) a lump sum cash payment equal to the product of (1) the number of “restricted shares” of company stock that the employee would have received under the company’s stock plan but did not receive for the time-vested portion of his long-term stock incentive award, if any, for the calendar year in which the change of control occurs times (2) the price per share of the company’s common stock utilized in effecting the change of control, provided that such amount shall be pro-rated by multiplying such amount by the number of full months that have elapsed from January 1 of that calendar year to the effective date of the change of control and then dividing the result by 12.