XML 33 R19.htm IDEA: XBRL DOCUMENT v3.24.0.1
EMPLOYEE BENEFIT PLANS
 12 Months Ended
Dec. 31, 2023
PENSION AND RETIREMENT PLANS  
EMPLOYEE BENEFIT PLANS

NOTE 12: EMPLOYEE BENEFIT PLANS

Supplemental Executive Retirement Plan  - The Company permits selected highly compensated employees to defer a portion of their compensation into the SERP. The liabilities related to these deferrals are recognized as Retirement plan liabilities on the Consolidated Balance Sheets. The SERP assets are invested primarily in company-owned life insurance (“COLI”) policies as a funding source to satisfy the obligation of the SERP. The assets are subject to claims by creditors, and the Company can designate them for another purpose at any time. Investments in COLI policies consist of variable life insurance policies of $8.5 million as of December 31, 2023 and $7.1 million as of December 31, 2022. In the COLI policies, the Company is able to allocate assets across a set of choices provided by the insurance underwriter, including fixed income securities and equity funds. The COLI policies are recorded at their net cash surrender values, which approximates fair value, as provided by the issuing insurance company, whose Standard & Poor’s credit rating was A+ in 2023.

The Company classifies the SERP assets as trading securities as described in note titled Significant Accounting Policies. The fair value of these assets totaled $15.4 million as of December 31, 2023 and $9.9 million as of December 31, 2022. The SERP assets are reported in retirement plan assets on the consolidated balance sheets and changes to the fair value of the assets are reported in selling, general and administrative expenses in the consolidated statements of operations. Trading gains (losses) related to the SERP assets totaled $1.5 million in 2023, $(2.4 million) in 2022 and $1.6 million in 2021.

The SERP liabilities include participant deferrals net of distributions and are stated at a fair value of $18.0 million as of December 31, 2023 and $14.4 million as of December 31, 2022. The SERP liabilities are reported on the consolidated balance sheets in retirement plan liabilities and any change in the fair value is recorded as compensation cost within selling, general and administrative expenses in the consolidated statements of operations. Changes in the fair value of the SERP liabilities represented unrealized gains (losses) of $1.8 million in 2023, and $(2.3 million) in 2022 and $1.6 million in 2021.

Retirement Income Plan (“Plan”) — The Company initiated actions to terminate the Plan in 2021 and it was fully terminated in 2023. As part of termination, the Company settled its participant liabilities in one of the following ways – (i) through a lump-sum settlement at the election of the participants; or (ii) transfer to a commercial annuity provider or a government agency. The Company funded this transfer through the liquidation of investments in the Plan assets. The Company recognized a pre-tax, non-cash settlement charge of $2.4 million during 2023, which represents the accelerated recognition of net actuarial loss that was previously recorded in accumulated other comprehensive loss (net of tax) and deferred taxes (tax effect). In addition, RPC utilized funds related to the Company’s plan assets to settle its participant liabilities, since it was a multiemployer Plan. See note titled Related Party Transactions for additional information.

​

​

​

​

​

​

​

​

December 31, 

    

2023

    

2022

(in thousands)

 

​

  

 

​

  

Accumulated benefit obligation at end of year

​

$

—

​

$

3,146

​

​

​

​

​

​

​

Change in projected benefit obligation:

​

 

​

​

 

  

Benefit obligation at beginning of year

​

$

3,146

​

$

5,832

Service cost

​

 

—

​

 

—

Interest cost

​

 

5

​

 

133

Actuarial loss

​

 

(243)

​

 

(1,045)

Benefits paid

​

 

(131)

​

 

(322)

Settlement

​

​

(2,777)

​

​

(1,452)

Projected benefit obligation at end of year

​

$

—

​

$

3,146

Change in plan assets:

​

 

​

​

 

  

Fair value of plan assets at beginning of year

​

$

3,502

​

$

6,870

Actual return on plan assets

​

 

(70)

​

 

(1,594)

Benefits paid

​

 

(131)

​

 

(322)

Transfer of assets

​

​

(524)

​

​

—

Settlement

​

​

(2,777)

​

​

(1,452)

Fair value of plan assets at end of year

​

$

—

​

$

3,502

Funded status at end of year

​

$

—

​

$

356

​

The accumulated benefit obligation for the Plan as of December 31, 2023 and 2022 has been disclosed above. The Company uses a December 31 measurement date for this qualified plan. The funded status of the Plan was recorded as Pension plan assets in the current assets section of the Consolidated Balance sheets as of December 31, 2022.

​

​

​

​

​

​

​

​

December 31, 

    

2023

    

2022

(in thousands)

 

​

  

 

​

  

Amounts (pre-tax) recognized in accumulated other comprehensive loss consist of:

 

​

  

 

​

  

Net loss

​

$

—

​

$

2,558

Prior service cost (credit)

​

 

—

​

 

—

​

​

$

—

​

$

2,558

​

The components of net periodic benefit cost of the Plan are summarized as follows:

​

​

​

​

​

​

​

​

​

​

​

(in thousands)

​

2023

​

2022

​

2021

​

    

​

​

​

​

​

​

​

​

Service cost for benefits earned during the period

​

$

—

​

$

—

​

$

—

Interest cost

​

 

5

​

 

133

​

 

147

Expected return on plan assets

​

 

—

​

 

—

​

 

(289)

Amortization of net losses

​

 

22

​

 

113

​

 

73

Settlement loss

​

​

2,363

​

​

1,180

​

​

—

Net periodic cost

​

$

2,390

​

$

1,426

​

$

(69)

​

The pre-tax amounts recognized in other comprehensive income for the years ended December 31, 2023, 2022 and 2021 are summarized as follows:

​

​

​

​

​

​

​

​

​

​

​

(in thousands)

    

2023

    

2022

    

2021

Net loss (gain)

​

$

(173)

​

$

549

​

$

879

Amortization of net loss

​

 

(22)

​

 

(113)

​

 

(73)

Settlement loss

​

​

(2,363)

​

​

(1,180)

​

​

—

Amount recognized in accumulated other comprehensive income (loss)

​

$

(2,558)

​

$

(744)

​

$

806

​

The weighted average assumptions as of December 31 used to determine the projected benefit obligation and net benefit cost were as follows:

​

​

​

​

​

​

​

​

​

December 31, 

    

2023

    

2022

    

2021

 

Projected benefit obligation:

 

  

 

  

 

  

​

Discount rate

 

(1)

​

(1)

​

(1)

​

Rate of compensation increase

 

—

 

N/A

 

N/A

 

Net benefit cost:

 

  

 

  

 

  

 

Discount rate

 

—

​

(1)

​

2.70

%  

Expected return on plan assets

 

—

​

—

​

4.00

%  

Rate of compensation increase

 

—

 

N/A

 

N/A

 

(1) As of December 31, 2023, there was no liability in the Plan and therefore, a discount rate does not apply. Projected benefit obligation as of December 31, 2022, and December 31, 2021 reflects termination of the Plan and is calculated based on various assumptions in accordance with the Plan agreement.

​

The Plan’s weighted average asset allocation at December 31, 2022 by asset category was as follows:

​

​

​

​

​

​

​

Percentage of

 

​

​

Plan Assets as of

 

​

​

December 31, 

 

Asset Category

    

2022

 

Cash and Cash Equivalents

 

3.7

%

Fixed Income Securities

 

96.3

​

Total

 

100.0

%

​

The following tables present our Plan assets using the fair value hierarchy as of December 31, 2022. The fair value hierarchy has three levels based on the reliability of the inputs used to determine fair value. See note titled Fair Value Measurements for a brief description of the three levels under the fair value hierarchy.

Fair Value Hierarchy as of December 31, 2022:

​

​

​

​

​

​

​

​

​

​

​

​

​

Investments (in thousands)

    

​

​

    

Total

    

Level 1

    

Level 2

Cash and Cash Equivalents

 

​

(1)

​

$

129

​

$

129

​

$

—

Fixed Income Securities

 

​

(2)

​

 

3,373

​

 

—

​

 

3,373

Total Assets in the Fair Value Hierarchy

​

​

​

​

$

3,502

​

$

129

​

$

3,373

​

(1)Cash and cash equivalents, which are used to pay benefits and plan administrative expenses, are held in Rule 2a-7 money market funds.
(2)Fixed income securities are primarily valued using a market approach with inputs that include broker quotes, benchmark yields, base spreads and reported trades. Subsequent to December 31, 2022, these securities were liquidated to fund the annuity purchase.

​

401(k) Plan — Marine Products participates in a defined contribution 401(k) plan sponsored by RPC that is available to substantially all full-time employees with more than 90 days of service. Effective January 1, 2019, the Company began matching 100% of employee contributions for each dollar of a participant’s contribution to the 401(k) Plan for the first three percent of his or her annual compensation, and 50% for each dollar of a participant’s contribution to the 401(k) Plan for the next three percent of his or her annual compensation. Employees vest in the Company’s contributions after two years of service. The charges to expense for Marine Products’ contributions to the 401(k) plan were $1.2 million in 2023, $1.2 million in 2022 and $1.0 million in 2021.

Stock Incentive Plan — The Company reserved 3,000,000 shares of common stock under the 2014 Stock Incentive Plan with a term of ten years expiring in April 2024. This plan provides for the issuance of various forms of stock incentives, including among others, incentive and non-qualified stock options and restricted shares. As of December 31, 2023, there were 777,199 shares available for grant.

The Company recognizes compensation expense for the unvested portion of awards outstanding over the remainder of the service period. The compensation cost recorded for these awards will be based on their fair value at grant date less the cost of estimated forfeitures. Forfeitures are estimated at the time of grant and revised, if necessary, in subsequent periods to reflect actual forfeitures.

Pre-tax stock-based employee compensation expense was approximately $3.7 million ($2.9 million after tax) for 2023, $2.7 million ($2.1 million after tax) for 2022, and $2.3 million ($1.8 million after tax) for 2021.

We have not issued any stock options since 2003 and have no immediate plans to issue additional stock options.

Restricted Stock — Marine Products grants selected employees and directors time lapse restricted stock that vest after a certain stipulated number of years from the grant date in the case of employees and that vest immediately for non-employee directors, depending on the terms of the issue. The time lapse restricted shares granted by the Company in 2023 to employees will vest ratably over a period of four years and the shares granted in 2022 will vest ratably over a period of five years. Prior to 2022, the time lapse restricted shares vested one-fifth per year beginning on the second anniversary of the grant date. During these years, grantees receive all dividends declared and retain voting rights for the shares.

The agreements under which the restricted stock is issued provide that shares awarded may not be sold or otherwise transferred until restrictions established under the stock plans have lapsed. Upon termination of employment from the Company, with the exception of death (fully vests), disability or retirement (partially vests based on duration of service), shares with restrictions are forfeited in accordance with the plan.

In the first quarter of 2023, the Company issued time-lapse restricted shares to certain employees that will vest ratably over a period of four years. In addition, the Company granted performance share unit awards to its executive officers that vest based on the achievement of pre-established performance targets. The awards will be issued at different levels based on the performance achieved with a cliff vesting at the end of calendar year 2025. The Company evaluated the portions of the awards that are probable to vest and accordingly has accrued estimated compensation expense equal to 100% of the target awards.

The following is a summary of the changes in non-vested restricted shares for the year ended December 31, 2023:

​

​

​

​

​

​

​

​

​

​

​

Weighted Average

​

​

​

​

Grant-Date Fair

​

    

Shares

    

Value

Non-vested shares at January 1, 2023

 

764,170

​

$

14.15

Granted

 

318,348

​

​

13.25

Vested

 

(243,468)

​

​

14.16

Non-vested shares at December 31, 2023

 

839,050

​

$

13.81

​

The following is a summary of the changes in non-vested restricted shares for the year ended December 31, 2022:

​

​

​

​

​

​

​

​

​

​

​

Weighted Average

​

​

​

​

Grant-Date Fair

​

    

Shares

    

Value

Non-vested shares at January 1, 2022

 

671,370

​

$

14.70

Granted

 

311,703

​

​

11.61

Vested

 

(193,403)

​

​

11.96

Forfeited

 

(25,500)

​

​

14.11

Non-vested shares at December 31, 2022

 

764,170

​

$

14.15

​

The fair value of restricted stock awards is based on the market price of the Company’s stock on the date of grant and is amortized to compensation expense on a straight-line basis over the requisite service period. The weighted average grant date fair value of these restricted stock awards was $13.25 in 2023, $11.61 in 2022 and $16.55 in 2021. The total fair value of shares vested was approximately $3.2 million in 2023, $2.2 million in 2022 and $3.2 million in 2021. The above table does not include any activity related to performance share unit awards since they are not currently issued or vested.

For the year ending December 31, 2023 approximately $57 thousand of excess tax benefits for stock-based compensation awards were recorded as a discrete tax adjustment and classified within operating activities in the consolidated statements of cash flows compared to approximately $68 thousand for the year ending December 31, 2022.

Other Information — As of December 31, 2023 total unrecognized compensation cost related to non-vested restricted shares was approximately $7.7 million which is expected to be recognized over a weighted-average period of 2.7 years.