Stein Mart 2014 Annual Report Download - page 41

STEIN MART, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in tables in thousands, except per share amounts)
F-17
We provide an executive split-dollar life insurance benefit which provides officers, key executives and director-level employees with pre-
retirement life insurance benefits based upon three to five times the current annual compensation. Effective December 31, 2012, active
employees and substantially all retirees were no longer eligible for the post-retirement life insurance benefit of one-half to two and one-half
times final base salary through an agreement between the Company and the insureds resulting in a curtailment and settlement of plan
benefits as detailed below. In addition to the discretionary contribution to the executive deferral plan described above, we made cash
payments to retirees totaling $1.6 million as a result of this change. The gain due to settlement of the post-retirement benefit of $7.7
million was more than offset by the cost of payments to retirees and executive deferral plan contributions. The curtailment and settlement
resulted in a remeasurement of the benefit obligation on December 31, 2012 using a discount rate of 3.8%. The discount rate used to
determine the benefit obligation was 3.45% and 4.5% as of January 31, 2015 and February 1, 2014, respectively.
The post-retirement benefit obligations included in other liabilities in the Consolidated Balance Sheets were $1.8 million and $1.7 million for
2014 and 2013, respectively.
The net periodic post-retirement benefit costs for 2014 and 2013 were insignificant. The following reflects the components of net periodic
post-retirement benefit income for 2012:
2012
Service cost 790$
Interest cost 404
Amortization of loss 93
Gain due to settlement (7,680)
Net periodic post-retirement benefit income (6,393)$
Amounts included in accumulated other comprehensive loss consisted of:
January 31, February 1,
2015 2014
Total net actuarial loss 118$79$
In connection with the executive deferral and executive split-dollar life insurance plans, whole life insurance contracts were purchased on
the related participants. At January 31, 2015 and February 1, 2014, the cash surrender value of these policies was $18.5 million and $18.4
million, respectively, and is included in other assets in the Consolidated Balance Sheets.
We have a noncontributory executive retiree medical plan wherein eligible retired executives may continue their pre-retirement medical,
dental and vision benefits through age 65. The postretirement benefit liability was $0.7 million at January 31, 2015 and $0.5 million at
February 1, 2014. Accumulated other comprehensive loss on the Consolidated Balance Sheets includes $0.2 million for this plan at
January 31, 2015 and February 1, 2014. The expense recorded in net income for 2014, 2013 and 2012 was insignificant.
8. ShareholdersEquity
Dividend
In 2014, we paid a quarterly dividend of $0.05 per common share on April 18, 2014 and a quarterly dividend of $0.075 per common share
on July 18, 2014, October 17, 2014 and January 16, 2015. In 2013, we paid a quarterly dividend of $0.05 per common share on July 19,
2013, October 18, 2013 and January 17, 2014. In 2012, we paid a special cash dividend of $1.00 per common share on December 24,
2012.
On February 4, 2015, the Company announced that its Board of Directors declared a special cash dividend of $5.00 per common share
which was paid on February 27, 2015. See Note 13 for further discussion.
Stock Repurchase Plan
During 2014, 2013 and 2012, we repurchased 320,081 shares, 87,742 shares and 574,686 shares of our common stock in the open
market at a total cost of $4.1 million, $1.1 million and $3.9 million, respectively. Stock repurchases for taxes due on the vesting of
employee stock awards during 2014, 2013 and 2012 included 216,729, 87,742 and 123,770 shares, respectively, purchased on the open
market under a Board of Directors authorized plan. As of January 31, 2015, there are 483,110 shares which can be repurchased pursuant
to the Board of Directorscurrent authorization.