International Paper 2015 Annual Report Download - page 88

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(b) Includes $14 million recorded in Other current assets and $2 million recorded in Deferred charges and other assets in the accompanying
consolidated balance sheet.
(c) Included in Other accrued liabilities in the accompanying consolidated balance sheet.
(d) Includes $4 million recorded in Other accrued liabilities and $3 million recorded in Other liabilities in the accompanying consolidated balance
sheet.
The above contracts are subject to enforceable master
netting arrangements that provide rights of offset with
each counterparty when amounts are payable on the
same date in the same currency or in the case of certain
specified defaults. Management has made an
accounting policy election to not offset the fair value of
recognized derivative assets and derivative liabilities in
the consolidated balance sheet. The amounts owed to
the counterparties and owed to the Company are
considered immaterial with respect to each
counterparty and in the aggregate with all
counterparties.
Credit-Risk-Related Contingent Features
International Paper evaluates credit risk by monitoring
its exposure with each counterparty to ensure that
exposure stays within acceptable policy limits. Credit
risk is also mitigated by contractual provisions with the
majority of our banks. Certain of the contracts include
a credit support annex that requires the posting of
collateral by the counterparty or International Paper
based on each party’s rating and level of exposure.
Based on the Company’s current credit rating, the
collateral threshold is generally $15 million.
If the lower of the Company’s credit rating by Moody’s
or S&P were to drop below investment grade, the
Company would be required to post collateral for all of
its derivatives in a net liability position, although no
derivatives would terminate. The fair values of
derivative instruments containing credit-risk-related
contingent features in a net liability position were $1
million as of December 31, 2015 and December 31,
2014, respectively. The Company was not required to
post any collateral as of December 31, 2015 or 2014.
NOTE 15 CAPITAL STOCK
The authorized capital stock at both December 31,
2015 and 2014, consisted of 990,850,000 shares of
common stock, $1 par value; 400,000 shares of
cumulative $4 preferred stock, without par value (stated
value $100 per share); and 8,750,000 shares of serial
preferred stock, $1 par value. The serial preferred stock
is issuable in one or more series by the Board of
Directors without further shareholder action.
The following is a rollforward of shares of common stock
for the three years ended December 31, 2015, 2014
and 2013:
Common Stock
In thousands Issued Treasury
Balance at January 1, 2013 439,894 13
Issuance of stock for various plans, net 7,328 (533)
Repurchase of stock — 11,388
Balance at December 31, 2013 447,222 10,868
Issuance of stock for various plans, net 1,632 (4,668)
Repurchase of stock — 22,534
Balance at December 31, 2014 448,854 28,734
Issuance of stock for various plans, net 62 (4,230)
Repurchase of stock —12,272
Balance at December 31, 2015 448,916 36,776
NOTE 16 RETIREMENT PLANS
International Paper sponsors and maintains the
Retirement Plan of International Paper Company (the
“Pension Plan”), a tax-qualified defined benefit pension
plan that provides retirement benefits to substantially
all U.S. salaried employees and hourly employees
(receiving salaried benefits) hired prior to July 1, 2004,
and substantially all other U.S. hourly and union
employees who work at a participating business unit
regardless of hire date. These employees generally are
eligible to participate in the Pension Plan upon attaining
21 years of age and completing one year of eligibility
service. U.S. salaried employees and hourly employees
(receiving salaried benefits) hired after June 30, 2004
are not eligible to participate in the Pension Plan, but
receive a company contribution to their individual
savings plan accounts (see Other U.S. Plans); however,
salaried employees hired by Temple Inland prior to
March 1, 2007 also participate in the Pension Plan. The
Pension Plan provides defined pension benefits based
on years of credited service and either final average
earnings (salaried employees and hourly employees
receiving salaried benefits), hourly job rates or specified
benefit rates (hourly and union employees).