þ | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Delaware | 22-2674487 | |
(State or Other Jurisdiction of | (IRS Employer | |
Incorporation or Organization) | Identification No.) | |
1100 Louisiana, Suite 2000 | ||
Houston, Texas | 77002-5215 | |
(Address of Principal Executive Offices) | (Zip Code) |
Name of Each | ||
Title of Each Class | Exchange on Which Registered | |
Common Stock, $0.01 par value
|
New York Stock Exchange | |
Series A Junior Participating Preferred Stock, $0.01 par value
|
New York Stock Exchange |
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10 | ||||||||
36 | ||||||||
41 | ||||||||
43 | ||||||||
44 | ||||||||
44 | ||||||||
50 | ||||||||
Certification of CEO Pursuant to Section 302 | ||||||||
Certification of CFO Pursuant to Section 302 |
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Name | Age | Director Since | ||
Robert B. Catell |
70 | 1986 | ||
John U. Clarke |
54 | 2003 | ||
David G. Elkins |
65 | 1999 | ||
William G. Hargett |
57 | 2001 | ||
Harold R. Logan, Jr. |
62 | 2002 | ||
Thomas A. McKeever |
63 | 2005 | ||
Stephen W. McKessy |
69 | 2003 | ||
Donald C. Vaughn |
71 | 1997 |
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Name | Age | Executive Since |
Office | |||
William G. Hargett |
57 | 2001 | Chairman, President and Chief Executive Officer | |||
Steven L. Mueller |
54 | 2001 | Executive Vice President and Chief Operating Officer | |||
Robert T. Ray |
46 | 2006 | Senior Vice President and Chief Financial Officer | |||
Roger B. Rice |
62 | 2002 | Senior Vice President Administration | |||
Jeffrey B. Sherrick |
52 | 2005 | Senior Vice President Business Development | |||
Carolyn M. Campbell |
45 | 2006 | Senior Vice President and General Counsel | |||
John E. Bergeron, Jr. |
49 | 2005 | Vice President and General Manager Southern Division | |||
Joanne C. Hresko |
45 | 2004 | Vice President and General Manager Northern Division | |||
James F. Westmoreland |
51 | 1986 | Vice President and Chief Accounting Officer |
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| Conflicts of interest | ||
| Customer relationships | ||
| Insider trading of our securities | ||
| Financial disclosure | ||
| Protection of confidential information | ||
| Strict legal and regulatory compliance. |
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| Maintaining our compliance with legal and regulatory requirements relating to financial reporting accounting and controls | ||
| Overseeing our whistleblower procedures | ||
| Overseeing the pre-approval of audit fees | ||
| Appointing and overseeing our independent public accountants | ||
| Overseeing our internal audit function | ||
| Overseeing the integrity of our financial reporting processes, including the Companys internal controls | ||
| Assessing the effect of regulatory and accounting initiatives, as well as any off-balance sheet structures, on our financial statements | ||
| Reviewing our earnings press releases, guidance and SEC filings | ||
| Overseeing our risk analysis and risk management procedures | ||
| Resolving any disagreements between management and the independent public accountants regarding financial reporting | ||
| Overseeing our business practices and ethical standards | ||
| Preparing an audit committee report to be included in our public filings pursuant to applicable rules and regulations of the SEC. |
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| Attract and retain key executives responsible for our continued growth and profitability; | ||
| Motivate management to enhance long-term stockholder value; and | ||
| Correlate a substantial portion of managements compensation to measurable performance, including specific financial and operating goals. |
| Providing competitive levels of total compensation when compared to the companies with whom we compete for executive talent; | ||
| Providing approximately half of each executives cash compensation in the form of performance-based components (annual incentives); | ||
| Providing a significant portion of each executives compensation in the form of equity incentives (stock options and restricted stock); | ||
| Requiring that executives maintain meaningful levels of share ownership as described on page 16 under the heading Stock Ownership Guidelines. |
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Component | Attributes | Rationale | ||||
Base Salary
|
Fixed compensation, eligible for annual merit increases, and payable semi-monthly | | Standard market practice | |||
| Compensation for day-to-day responsibilities of position | |||||
| Reflects the experience, responsibilities and contribution of each individual executive officer | |||||
Annual Incentive
|
Variable cash compensation earned only when established annual performance goals are achieved | | Standard market practice | |||
| Reduces fixed compensation cost | |||||
| Motivates and rewards executives for achievement of meaningful performance goals on an annual basis | |||||
Stock Options
|
Right to purchase Houston
Exploration stock at a fixed price
at some date in the future (not to
exceed 10 years from the date of
grant), earned contingent upon
continued employment. Awarded at the closing price on the date of grant. Awards vest in equal portions over a three-year period. |
| Provision of some form of long-term incentive is standard market practice | |||
| Motivates and rewards executives for company performance over a multi-year period | |||||
| Enhances retention of executives by vesting awards over a three-year period | |||||
| Ties executive rewards to stockholder interests | |||||
Restricted Stock
|
Actual shares of Houston
Exploration stock, earned
contingent upon continued
employment. Awards vest on the third anniversary of the date of grant. |
| Provision of some form of long-term incentive is standard market practice | |||
| Motivates and rewards executives for company performance over a multi-year period | |||||
| Enhances retention of executives by vesting awards at the end of a three-year period | |||||
| Ties executive rewards to stockholder interests | |||||
Retirement Benefits
|
401(k) Defined Contribution Plan | | Standard market practice | |||
| Provides a form of benefits offered to all employees | |||||
Supplemental Executive Retirement Plan (SERP) |
| Restores certain benefits that are limited by the Internal Revenue Code (the Code) | ||||
Other Benefits
|
Fixed component, comprised of health insurance, life insurance, vision, deferred compensation, long-term disability | | Provides form of benefits offered to all employees | |||
| Provides for basic life and income security needs | |||||
| Provides supplemental benefits to assist in executives roles as representatives of Houston Exploration | |||||
Severance Benefits
|
Multiple of salary and bonus, continuation of benefits, and vesting of outstanding equity incentive awards in the case of certain qualifying terminations, including termination following a change-in-control | | Provides a bridge to future employment in the event an executive is terminated under certain circumstances | |||
| Provides additional security to allow executives to focus on issues critical to the success of Houston Exploration even in the face of uncertainty (e.g., a sale of the company) |
| Base Salary |
| Base compensation is initially established for each executive through negotiation and is reflected in the executives employment agreement. Thereafter, salaries are reviewed annually, based on a number of factors, both quantitative, including detailed organizational and competitive analyses performed by Towers Perrin, an independent consultant engaged by the Compensation Committee, and qualitative, including the Compensation Committees perception of the executives experience, performance and contribution. The Compensation Committee typically follows a practice of maintaining base salaries at approximately the level constituting the fiftieth percentile of our peer group, and deviates from this practice in individual cases when market conditions or other factors warrant. The Compensation Committee does not assign any pre-determined weight to any factors in its annual review process. | ||
| Based on a review of executive pay conducted in October 2006 by the consultant, salaries for all of the NEOs were within 10% of the market median. | ||
| The average salary increase for the NEOs overall during 2006 was 7.9%. The Chief Operating Officer received a 14.29% salary increase and the Chief Executive Officer received an 11.11% salary increase in October of 2006, in order to better align salaries with peer companies. |
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| Annual Incentive |
| Under our annual incentive compensation program, each executive has the opportunity to earn an additional cash incentive compensation bonus based on the achievement of pre-determined operating and financial performance measures established annually by the Compensation Committee. | ||
| Each executives bonus opportunity is initially reflected in the executives employment agreement and subsequently reviewed annually. Currently, the Compensation Committee has set annual bonus opportunities as a percentage of base salary as follows: |
| CEO | 85% of annual earned salary | ||||
| COO | 65% of annual earned salary | ||||
| Other executives | 55% of annual earned salary |
| Each of these bonus opportunities reflects the percentage of salary each executive could expect to earn in the form of an incentive bonus, if the Company and the executive achieve target performance under all performance measures established for the year. Depending upon actual performance, each executive may earn between 0% and 200% of his or her bonus opportunity. | ||
| During 2006, the following measures determined the size of bonus awards earned by employees, including all NEOs, classified in the corporate group of the program: Cash Flow, Reserve Additions, and Finding Costs. The measures are each significant measures of our business success and are weighted equally. For purposes of the annual incentive compensation program, Cash Flow is defined as cash provided by operating activities (per our audited consolidated statement of cash flows) before the effect of any changes in operating assets and liabilities. Reserve Additions is the net amount of additions from all sources to our oil and gas reserve base at the beginning of the year as determined by our independent, outside reserve engineering consultants. Finding Cost is the total amount of capital expended on exploration, development, and acquisitions compared to the total amount of reserves booked during the year (expressed as $/Mcfe). | ||
| The targets for these measures are derived from our 2006 business plan as approved by the Board and are set at or above the levels set within the business plan. Achievement over and above the targets can occur only when the annual business plan is exceeded. Inasmuch as the annual business plan is our estimate of maximum expected achievement for the year, exceeding the targets for the three measures is unusual and difficult. | ||
| Under our annual incentive compensation program, the Compensation Committee has discretion to adjust targets, as well as individual awards, either positively or negatively. The Compensation Committee did not exercise discretion in the determination of individual awards to the NEOs for the year ended December 31, 2006. However, the Board noted that the targets established by the Compensation Committee in January 2006 were predicated upon the sale of our offshore assets and the successful redeployment of the proceeds in new properties and that the Board had continued to reevaluate its strategic alternatives throughout the year, resulting in a decision not to make any significant acquisitions of assets. Accordingly, in determining incentive compensation for 2006, the Compensation Committee took into account the impact on its previously established targets of this course of events, which was beyond the ability of the employees to control, and adjusted the target associated with one of the measures applicable to employees, including all NEOs, classified within the corporate group of the plan. | ||
| Actual achievement levels for 2006 are highlighted in the table below: |
Measure | Weight | Threshold | Target | Maximum | 2006 Actual | |||||||||||||||
Cash Flow |
33 | % | 70 | % | 100 | % | 200 | % | 108 | % | ||||||||||
Reserve Additions |
33 | % | 70 | % | 100 | % | 200 | % | 122 | % | ||||||||||
Finding Costs |
33 | % | 70 | % | 100 | % | 200 | % | 0 | % | ||||||||||
Estimated Payout
Earned at Each
Level of
Performance |
50 | % | 100 | % | 200 | % | ||||||||||||||
Total Percent of Individual Target Award Earned at Each Level of Performance | 76.6 | % |
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| Long-Term Incentives |
Under our Amended and Restated 2004 Long-Term Incentive Plan (the LTIP), approved by stockholders in 2004, the Compensation Committee has the ability to make long-term incentive awards to NEOs in a variety of forms, including stock options and restricted stock. |
| Stock Options |
Stock options represent rights to purchase shares of Houston Exploration stock at a set price at some date in the future, not to exceed ten years from the date of grant. Stock options are granted with an exercise price equal to the closing stock price on the date of grant. | |||
In October 2006, stock options were awarded to all NEOs. Consistent with market practice, assuming continued employment with the Company, these stock option awards vest in three equal installments on the first, second, and third anniversary of the date of grant, subject to acceleration in the event of a change of control, such as our pending merger with Forest, and expire ten years from the date of grant. Stock option awards for 2006 represented approximately 50% of the value of all long-term incentive awards provided to each of the NEOs. | |||
We believe that awards of stock options provide a significant incentive for executives to remain employed in order to achieve and maintain high levels of performance over multi-year periods, and strengthen the connection between executive and stockholder interests. Although no performance-vesting criteria are applied to our stock option awards, we believe that stock options represent a powerful performance-based incentive, as the options become valuable only to the extent that our stock price increases following the date of grant. |
| Restricted Stock |
Restricted stock awards represent awards of actual shares of our common stock, earned contingent upon continued employment. | |||
In October 2006, restricted stock was awarded to each of the NEOs. Consistent with market practice, these awards vest in their entirety upon the third anniversary of the date of grant, subject to acceleration in the event of a change of control, such as our pending merger with Forest. For 2006, restricted stock awards represented approximately 50% of the total long-term incentive value provided to each NEO. | |||
We believe that awards of restricted stock provide a significant incentive for executives to achieve and maintain high levels of performance over multi-year periods, and strengthen the connection between executive and stockholder interests. We believe that restricted shares are a powerful tool for helping us retain executive talent. The higher value of a share of restricted stock in comparison to a stock option allows us to use fewer total shares in order to arrive at a competitive total long-term incentive award value, thereby reducing dilution of stockholder value. Furthermore, we believe that the use of restricted stock reflects competitive practice among other independent exploration and production companies with whom we compete for executive talent. |
| Retirement Benefits |
| Qualified: |
We maintain a 401(k) plan for our employees. Under the 401(k) plan, eligible employees may elect to contribute up to 12.5% of their compensation on a pre-tax basis in accordance with the limitations imposed under the Code. We match 100% of each employees deferrals in accordance with the limitations imposed by the 401(k) plan and the Code. The cash amounts contributed under the 401(k) plan are held in a trust and invested among various investment funds in accordance with the directions of each participant. An employees salary deferral contributions under the 401(k) plan are 100% vested. Our matching contributions vest at the rate of 20% per year of service subject to acceleration in the event of a change of control, such as our pending merger with Forest. Participants are entitled to payment of their vested account balances upon termination of employment. On January 7, 2007, the 401(k) plan was amended to provide for the full vesting of all plan account balances at the effective time of the proposed merger with Forest Oil with respect to plan participants who are employed by Houston Exploration immediately prior to the effective time of the merger. |
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| Non-Qualified: |
Effective January 1, 2006, we adopted a Supplemental Executive Retirement Plan (SERP) to provide retirement benefits to certain management level or other highly compensated employees. The SERP is an unfunded, non-qualified defined benefit pension plan. Participation in the SERP is currently limited to our executive officers. Participants in the SERP will be entitled to a retirement benefit payable monthly for life. The annual amount of this retirement benefit is equal to 2.5% times final average compensation, times years of service with Houston Exploration (not to exceed 20 years), reduced by an annuity based on a hypothetical account that is credited with 6% of the participants compensation during each year of employment and investment returns as defined in the plan (we refer to this reduction as the offset). Participants are fully vested in their benefits after five years of plan participation or age 65, whichever is earlier. If a vested participant retires prior to age 65, then the monthly retirement benefit as described above (before reduction for the offset) will be reduced by 5% for each year that retirement precedes age 65. In the event a participant is terminated for cause, all benefits under the SERP will be forfeited. All benefits become fully vested upon a change of control (as defined in the plan), including our pending merger with Forest, and may become payable in a lump-sum if a participants employment is terminated by us without cause or the participant resigns for good reason within two years following a change of control. | |||
Since November 2002, we have maintained a deferred compensation plan for the benefit of our employees. We have two such plans that are substantially identical, except for differences attributable to Section 409A of the Code and the regulations and/or guidance promulgated thereunder (collectively Section 409A), covering two separate time periods. On July 25, 2006, we amended the 2002 deferred compensation plan to prohibit deferrals or contributions to the plan after December 31, 2004 and to transfer to the 2005 deferred compensation plan all amounts not vested as of December 31, 2004, effectively grandfathering within the 2002 plan all participant deferrals and company matching contributions that were vested as of December 31, 2004, as well as the earnings and losses on those amounts. On July 25, 2006, we also adopted the 2005 deferred compensation plan, which covers all participant deferrals and company matching contributions from and after January 1, 2005, as well as any contributions made prior to such date that were not vested as of December 31, 2004, and the earnings or losses on such amounts. The deferred compensation plan is intended to supplement our 401(k) plan by allowing highly compensated employees to save on a tax deferred basis a portion of their eligible compensation subject to limitations imposed by the plan. Under the terms of the plan, employees who have made the maximum allowable contribution to their 401(k) accounts for any year ($15,000, $14,000 and $13,000 per year, respectively, for 2006, 2005, and 2004, with an additional one-time contribution of $5,000 in 2006, $4,000 in 2005, and $3,000 in 2004 for employees 50 years of age or older) may elect to defer an additional portion of their compensation into the deferred compensation plan. We match 100% of each employees deferral up to an aggregate contribution of 12.5% under both the 401(k) plan and the deferred compensation plan. Employer contributions vest 20% per year and become fully vested after a five-year period, subject to acceleration in the event of a change of control, including our pending merger with Forest. All cash contributions to the plan are held in trust and invested, at the direction of the employee, in various investment funds. Participants are entitled to distribution of their deferrals and the vested portion of our matching contributions at predetermined future dates or upon termination of their employment. |
| Other Benefits |
| NEOs are eligible to participate in other benefit plans, which provide for basic health and welfare needs, on an equal basis with our other employees. In addition, NEOs are eligible for certain perquisites which are provided in order to assist NEOs in their roles as representatives of the company. Perquisites offered to executives include a car allowance and luncheon club memberships. See the 2006 Perquisites and Other Personal Benefits table on page 20 for further details. |
| Severance Benefits |
| We provide for severance benefits to provide a bridge to future employment in the event the executives job is terminated under a variety of scenarios. Change of control severance benefits are subject to a double trigger (i.e., both a change of control and termination of employment must occur for severance benefits to be paid). We believe it is in the best interest of our stockholders to provide a reasonable degree of economic protection in the event of a change of control to assure that management makes decisions that are in the best interest of stockholders. |
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Element | CEO | Other NEOs Average | ||||||
Base Salary |
19 | % | 32 | % | ||||
Annual Incentive (actual) |
12 | % | 14 | % | ||||
Long-term Incentives
(grant date fair value) |
69 | % | 54 | % |
| Proxy statement compensation data for a peer group of similarly sized and positioned independent exploration and production companies are used for comparison to that of Houston Explorations most senior executives including NEOs. The data from this analysis are valuable in that they provide a summary of competitive practice among companies with similar operations and business challenges with whom we compete most directly for talent. The peer group reviewed in 2006 is set forth below: |
Cabot Oil & Gas | Plains Exploration & Production Company | |||
Cimarex Energy Co. | Pogo Producing Company | |||
Forest Oil Corporation | Southwestern Energy Company | |||
Newfield Exploration Company | Stone Energy Corporation | |||
Noble Energy, Inc. | XTO Energy, Inc. |
| Data from other Towers Perrin compensation surveys are used to supplement the peer group proxy analysis. Compensation survey data reflect practices among independent exploration and production companies as well as among similarly sized companies in a broader general industry sample. By considering compensation survey data, we are able to review pay data for positions not captured in our |
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peer group proxy compensation analysis, and we are able to consider practices across a broader market sample, gaining additional perspective. |
Option Pricing and Timing With Respect to Material Non-Public Information | ||
We generally grant stock option awards in the fourth quarter of each year, following a review of competitive market data by the Compensation Committee, as described below under the heading Compensation Policies. Stock options are granted with an exercise price equal to the closing price of a share of our common stock on the date of grant (at the money). We do not engage and have not engaged in the practice of backdating options, nor do we have any official policy regarding the timing of option awards to coincide with the release of material non-public information. | ||
Review of Tally Sheets and Termination Provisions | ||
The Compensation Committee and management analyzed tally sheets, with the assistance of the Compensation Committees independent advisor, in the course of compensation-related deliberations. Tally sheet analyses consider current and historical base salaries, annual incentive compensation, long-term incentive compensation, perquisites, and retirement benefits, as well as the potential cost impact of contractual post-termination payments in the event of a change of control, such as our pending merger with Forest. While historical compensation practices (including past awards of equity incentives) are considered in the course of pay-related deliberations, we have no formal policy or formulaic approach regarding the determination of actual levels of current compensation with respect to past compensation or levels of past wealth accumulation. | ||
Stock Ownership Guidelines | ||
While continuing its policy of annual grants of options and restricted stock, in 2006 the Compensation Committee developed stock ownership guidelines for all executive officers. Restricted stock, stock owned outright and stock held in company savings plans, if any, apply toward the target levels of ownership. Under these newly established guidelines, individuals have a five-year period to achieve ownership of stock valued at the recommended target ownership levels as outlined below: |
| CEO | 5 times current salary | ||||
| Executive Vice Presidents & COO | 3 times current salary | ||||
| Senior Vice Presidents | 2 times current salary | ||||
| Vice Presidents | 1 times current salary |
| Our policy is to grant all stock options and other equity awards annually, following the regularly scheduled fourth quarter Board meeting, except that newly hired employees may be granted stock options and other equity awards as of the date of initial employment. |
| We have a policy that executive officers and directors may not purchase or sell exchange traded options to sell or buy Houston Exploration stock (puts and calls), engage in short sales with respect to Houston Exploration stock or otherwise hedge equity positions in Houston Exploration (e.g., by buying or selling straddles, swaps or other derivatives). |
| We do not have an executive compensation recovery policy. However, Houston Exploration may seek to recover incentive compensation that was based on achievement of financial results if a subsequent restatement of financial results indicates that the executive would not have been entitled to such incentive compensation. To date, there has been no such event. |
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Change in | ||||||||||||||||||||||||||||||||||||
pension value | ||||||||||||||||||||||||||||||||||||
and non- | ||||||||||||||||||||||||||||||||||||
Non-equity | qualified | |||||||||||||||||||||||||||||||||||
incentive | deferred | |||||||||||||||||||||||||||||||||||
Stock | Option | plan | compensation | All other | ||||||||||||||||||||||||||||||||
awards | awards | compensation | earnings | compensation | ||||||||||||||||||||||||||||||||
Name and principal | Salary | Bonus | ($) | ($) | ($) | ($) | ($) | Total | ||||||||||||||||||||||||||||
position | Year | ($) | ($) | (1) | (1) | (2) | (3) | (4) | ($) | |||||||||||||||||||||||||||
William G. Hargett |
2006 | $ | 531,250 | $ | | $ | 553,336 | $ | 1,003,920 | $ | 345,897 | $ | 145,000 | $ | 90,731 | $ | 2,670,134 | |||||||||||||||||||
Chairman, President
and Chief Executive
Officer |
||||||||||||||||||||||||||||||||||||
Steven L. Mueller |
2006 | $ | 362,500 | $ | | $ | 262,269 | $ | 475,949 | $ | 180,489 | $ | 74,200 | $ | 76,252 | $ | 1,431,659 | |||||||||||||||||||
Executive Vice
President and Chief
Operating Officer |
||||||||||||||||||||||||||||||||||||
Robert T. Ray |
2006 | $ | 310,625 | $ | 85,000 | (6) | $ | 166,675 | $ | 116,467 | $ | 130,866 | $ | 12,600 | $ | 30,854 | $ | 853,087 | ||||||||||||||||||
Senior Vice
President and Chief
Financial Officer |
||||||||||||||||||||||||||||||||||||
Jeffrey B. Sherrick |
2006 | $ | 292,500 | $ | 100,000 | (7) | $ | 172,450 | $ | 133,993 | $ | 123,230 | $ | 27,100 | $ | 60,532 | $ | 909,805 | ||||||||||||||||||
Senior Vice
President -
Corporate
Development |
||||||||||||||||||||||||||||||||||||
Roger B. Rice |
2006 | $ | 255,250 | $ | | $ | 165,958 | $ | 270,057 | $ | 107,537 | $ | 102,300 | $ | 56,661 | $ | 957,763 | |||||||||||||||||||
Senior Vice
President -
Administration |
(1) | Amounts reflect the dollar amount recognized for financial statement reporting purposes for the fiscal year ended December 31, 2006, in accordance with SFAS 123(R), of awards pursuant to the officers existing employment agreement, and thus include amounts from awards granted in and prior to 2006. A discussion of the valuation assumptions used for purposes of the SFAS 123(R) calculation is included under Note 4 to the Companys 2006 Consolidated Financial Statements set forth in the Companys Annual Report on Form 10-K, as amended, for the year ended December 31, 2006. | |
(2) | Amounts reflect the cash awards to the named individuals under the Companys annual incentive compensation program, which is discussed in further detail on page 12 under the heading Compensation Element Details Annual Incentive. | |
(3) | Amounts reflect the actuarial increase in the present value of the named executive officers benefits under our pension plan (the SERP) and include amounts which the NEO may not currently be entitled to receive because such amounts are not vested (although they would vest upon a change of control, including our pending merger with Forest). The change in pension value shows the difference in the present value of accumulated benefits determined as of December 31, 2006 and December 31, 2005 for the SERP. Earnings from the non-qualified deferred compensation plan are not above-market, and therefore are not included in this column. The change in pension value shows the impact of a variety of factors, including: |
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Measurement | Date | |||
Assumption | 12/31/2005 | 12/31/2006 | ||
Discount Rate |
5.50% | 5.75% | ||
30-year Treasury Rate |
4.50% | 4.75% | ||
Form of Payment |
Life Annuity | Life Annuity | ||
Preretirement Turnover |
None | None | ||
Mortality
Assumption: 4Preretirement 4Postretirement |
None RP 2000* |
None RP 2000* |
||
Assumed Retirement Age (earliest unreduced age): |
Age 65 | Age 65 |
* | with projected mortality improvements to 2010 (sex distinct, healthy, no collar adjustment) | |
(4) | Includes (i) matching contributions for each NEO under our 401(k) plan and deferred compensation plan, (ii) car allowances, and (iii) perquisites and other personal benefits for each NEO, as more fully described in the 2006 Perquisites and Other Personal Benefits table on page 20. | |
(5) | Mr. Ray commenced his employment with the Company effective January 18, 2006 and received a sign-on bonus of $85,000. | |
(6) | On September 19, 2006, the Board approved a discretionary bonus in the amount of $100,000 for Mr. Sherrick during 2006, awarded in recognition of his significant contribution to completing the divestiture of substantially all of our offshore Gulf of Mexico assets as part of our strategic restructuring. |
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Matching | Matching | Life Insurance | ||||||||||||||||||
Contributions | Contributions Under | and Long-Term | ||||||||||||||||||
Car | Under 401(k) | Deferred | Disability | Club | ||||||||||||||||
Allowance(1) | Savings Plan(2) | Compensation Plan(3) | Premiums(4) | Memberships(5) | ||||||||||||||||
William G. Hargett |
$ | 8,400 | $ | 20,000 | $ | 54,977 | $ | 4,272 | $ | 3,082 | ||||||||||
Chairman, President
and Chief Executive
Officer |
||||||||||||||||||||
Steven L. Mueller |
$ | 8,400 | $ | 20,000 | $ | 45,421 | $ | 2,431 | $ | | ||||||||||
Executive Vice
President and Chief
Operating Officer |
||||||||||||||||||||
Robert T. Ray |
$ | 8,050 | $ | 15,000 | $ | | $ | 2,332 | $ | 5,472 | ||||||||||
Senior Vice
President and Chief
Financial Officer |
||||||||||||||||||||
Jeffrey B. Sherrick |
$ | 8,400 | $ | 20,000 | $ | 27,647 | $ | 2,208 | $ | 2,277 | ||||||||||
Senior Vice
President -
Corporate
Development |
||||||||||||||||||||
Roger B. Rice |
$ | 8,400 | $ | 20,000 | $ | 25,138 | $ | 1,923 | $ | 1,200 | ||||||||||
Senior Vice
President -
Administration |
(1) | Reflects $700 monthly car allowance paid to each NEO pursuant to their employment agreements. | |
(2) | Participants may elect to have us contribute on their behalf up to 12.5% of their total compensation (subject to limitations imposed under the Code) on a pre-tax basis. We match 100% of each employees deferral, subject to limitations imposed by the 401(k) plan and the Code. The amounts contributed under the 401(k) plan are held in a trust and invested at the direction of each participant among various investment funds. An employees salary deferral contributions to the 401(k) plan are 100% vested. Our matching contributions vest at the rate of 20% per year of service, subject to acceleration in the event of a change of control, such as our pending merger with Forest. | |
(3) | Employees who have made the maximum allowable contribution to their 401(k) plan accounts for any year may elect to defer an additional portion of their compensation into the deferred compensation plan. We match 100% of each employees deferral up to an aggregate contribution of 12.5% of their total compensation under both the 401(k) plan and the deferred compensation plan. Our matching contributions vest at the rate of 20% per year of service, subject to acceleration in the event of a change of control, such as our pending merger with Forest. | |
(4) | We provide life insurance for all employees in the amount of 100% of the employees annual base salary, not to exceed $500,000. In 2006, we paid term life insurance premiums of $2,832 for Mr. Hargett; $991 for Mr. Mueller; $892 for Mr. Ray; $821 for Mr. Sherrick and $714 for Mr. Rice. In addition, we purchase supplemental long-term disability insurance to provide salary replacement in the amount of 60% of annual base salary at the date of disability, not to exceed $15,000 per month (to continue for the duration of disability until at least age 65, or for life if reasonably practicable) for our executive officers. In 2006, we paid long-term disability insurance premiums of $1,440 for Mr. Hargett; $1,440 for Mr. Mueller; $1,440 for Mr. Ray; $1,387 for Mr. Sherrick; and $1,209 for Mr. Rice. | |
(5) | Each executive is authorized to incur reasonable business expenses for promoting the business and reputation of the Company, including luncheon club memberships. |
- 20 -
All Other | ||||||||||||||||||||||||||||||||||||||||||||
All Other | Options | |||||||||||||||||||||||||||||||||||||||||||
Stock | Awards: | Exercise | Grant | |||||||||||||||||||||||||||||||||||||||||
Estimated Future | Awards: | Number of | or Base | Date Fair | ||||||||||||||||||||||||||||||||||||||||
Estimated Future Payouts Under | Payouts Under Equity | Number | Securities | Price of | Value of | |||||||||||||||||||||||||||||||||||||||
Non-Equity Incentive Plan Awards | Incentive Plan Awards(4) | of Shares | Underlying | Option | Stock and | |||||||||||||||||||||||||||||||||||||||
Grant | Threshold | Target | Maximum | Threshold | Target | Maximum | of Stock | Options | Awards | Option | ||||||||||||||||||||||||||||||||||
Name | Date | ($)(1) | ($)(2) | ($)(3) | (#) | (#) | (#) | (#)(5) | (#)(6) | ($/Sh)(7) | Awards(8) | |||||||||||||||||||||||||||||||||
William G. Hargett |
10/24/2006 | 20,000 | 54,000 | $ | 55.50 | $ | 1,930,800 | |||||||||||||||||||||||||||||||||||||
Chairman, President and Chief Executive Officer |
$ | 225,781 | $ | 451,563 | $ | 903,125 | ||||||||||||||||||||||||||||||||||||||
Steven L. Mueller |
10/24/2006 | 7,000 | 20,000 | $ | 55.50 | $ | 692,500 | |||||||||||||||||||||||||||||||||||||
Executive Vice President
and Chief Operating Officer |
$ | 117,812 | $ | 235,625 | $ | 471,250 | ||||||||||||||||||||||||||||||||||||||
Robert T. Ray |
1/18/2006 | (9) | 7,500 | 20,000 | $ | 53.72 | $ | 680,100 | ||||||||||||||||||||||||||||||||||||
Senior Vice President and |
10/24/2006 | 7,000 | 19,000 | $ | 55.50 | $ | 677,300 | |||||||||||||||||||||||||||||||||||||
Chief Financial Officer |
$ | 85,422 | $ | 170,844 | $ | 341,687 | ||||||||||||||||||||||||||||||||||||||
Jeffrey B. Sherrick |
10/24/2006 | 3,800 | 10,400 | $ | 55.50 | $ | 368,980 | |||||||||||||||||||||||||||||||||||||
Senior Vice President -
Corporate Development |
$ | 80,438 | $ | 160,875 | $ | 321,750 | ||||||||||||||||||||||||||||||||||||||
Roger B. Rice |
10/24/2006 | 3,600 | 9,800 | $ | 55.50 | $ | 348,760 | |||||||||||||||||||||||||||||||||||||
Senior Vice President -
Administration |
$ | 70,194 | $ | 140,388 | $ | 280,775 |
(1) | Amounts reflect the estimated future payout, which is 50% of the target, at the minimum achievement level under our annual incentive compensation program. | |
(2) | Amounts reflect the estimated future payout, which is 100% of the target, at the target achievement level under our annual incentive compensation program. | |
(3) | Amounts reflect the estimated future payout, which is 200% of the target, at the maximum achievement level under our annual incentive compensation program. | |
(4) | Houston Exploration has never granted equity incentive plan awards. | |
(5) | Amounts reflect the number of shares of restricted stock awarded to each named executive officer pursuant to the 2004 LTIP. These restricted stock awards vest in their entirety on the third anniversary of the date of grant. | |
(6) | Amounts reflect the number of stock options granted to each named executive officer pursuant to the 2004 LTIP. These stock options vest in three equal installments on the first, second and third anniversary of the date of grant and expire ten years from the date of grant. | |
(7) | Stock options are granted with an exercise price equal to the closing price of our common stock on the NYSE on the date of grant. | |
(8) | Grant date fair value of stock awards is equal to the closing price of our common stock on the NYSE on the date of grant. Grant date fair value of stock options is calculated using the Black Scholes method of valuing options. | |
(9) | Mr. Ray commenced his employment with the Company effective January 18, 2006 and received restricted stock and stock option awards at that time. |
- 21 -
Option Awards(1) | Stock Awards(2) | |||||||||||||||||||||||||||||||||||
Equity | ||||||||||||||||||||||||||||||||||||
Equity | incentive plan | Equity | ||||||||||||||||||||||||||||||||||
incentive plan | awards: | incentive plan | ||||||||||||||||||||||||||||||||||
awards: | Number of | awards: | ||||||||||||||||||||||||||||||||||
Number of | Number of | Number of | Number of | unearned | Market or | |||||||||||||||||||||||||||||||
securities | securities | securities | shares or | Market value | shares, units | payout value of | ||||||||||||||||||||||||||||||
underlying | underlying | underlying | units of | of shares or | or other | unearned | ||||||||||||||||||||||||||||||
unexercised | unexercised | unexercised | Option | stock that | units of stock | rights that | shares, units or | |||||||||||||||||||||||||||||
options | options | unearned | exercise | Option | have not | that have not | have not | other rights | ||||||||||||||||||||||||||||
(#) | (#) | options | price | expiration | vested | vested | vested | that have not | ||||||||||||||||||||||||||||
Name | Exercisable | Unexercisable | (#) (3) | ($) | date | (#) | ($)(4) | (#)(3) | vested ($)(3) | |||||||||||||||||||||||||||
William G. Hargett |
7,818 | | N/A | $ | 25.58 | 4/4/2011 | N/A | N/A | ||||||||||||||||||||||||||||
Chairman, President
and |
20,182 | | $ | 25.58 | 4/4/2011 | |||||||||||||||||||||||||||||||
Chief Executive Officer |
35,200 | | $ | 25.48 | 9/20/2011 | |||||||||||||||||||||||||||||||
38,000 | 19,000 | (5) | $ | 30.10 | 10/16/2012 | |||||||||||||||||||||||||||||||
27,160 | 27,160 | (5) | $ | 35.62 | 10/21/2013 | |||||||||||||||||||||||||||||||
10,800 | 16,200 | (5) | $ | 59.16 | 10/22/2014 | 13,000 | (5) | $ | 673,140 | |||||||||||||||||||||||||||
12,667 | 25,333 | (5) | $ | 54.18 | 10/25/2015 | 17,000 | (5) | $ | 880,260 | |||||||||||||||||||||||||||
| 54,000 | (5) | $ | 55.50 | 10/24/2016 | 20,000 | (5) | $ | 1,035,600 | |||||||||||||||||||||||||||
Steven L. Mueller |
9,756 | | N/A | $ | 30.75 | 10/22/2011 | N/A | N/A | ||||||||||||||||||||||||||||
Executive Vice
President and |
25,244 | | $ | 30.75 | 10/22/2011 | |||||||||||||||||||||||||||||||
Chief Operating Officer |
31,200 | 7,800 | (6) | $ | 30.10 | 10/16/2012 | ||||||||||||||||||||||||||||||
12,180 | 8,120 | (6) | $ | 35.62 | 10/21/2013 | 4,000 | (6) | $ | 207,120 | |||||||||||||||||||||||||||
3,600 | 5,400 | (6) | $ | 59.16 | 10/22/2014 | 6,553 | (6) | $ | 339,314 | |||||||||||||||||||||||||||
4,334 | 8,666 | (6) | $ | 54.18 | 10/25/2015 | 6,000 | (6) | $ | 310,680 | |||||||||||||||||||||||||||
| 20,000 | (6) | $ | 55.50 | 10/24/2016 | 7,000 | (6) | $ | 362,460 | |||||||||||||||||||||||||||
Robert T. Ray |
| 20,000 | (7) | N/A | $ | 53.72 | 1/18/2016 | 7,500 | (7) | $ | 388,350 | N/A | N/A | |||||||||||||||||||||||
Senior Vice President |
| 19,000 | (7) | $ | 55.50 | 10/24/2016 | 7,000 | (7) | $ | 362,460 | ||||||||||||||||||||||||||
and Chief
Financial Officer |
||||||||||||||||||||||||||||||||||||
Jeffrey B. Sherrick |
4,000 | 16,000 | (8) | N/A | $ | 55.09 | 4/11/2015 | 7,500 | (8) | $ | 388,350 | N/A | N/A | |||||||||||||||||||||||
Senior Vice
President - |
3,000 | 6,000 | (8) | $ | 54.18 | 10/25/2015 | 4,000 | (8) | $ | 207,120 | ||||||||||||||||||||||||||
Corporate
Development |
| 10,400 | (8) | $ | 55.50 | 10/24/2016 | 3,800 | (8) | $ | 196,764 | ||||||||||||||||||||||||||
Roger B. Rice |
5,600 | 2,800 | (9) | N/A | $ | 30.95 | 3/1/2012 | N/A | N/A | |||||||||||||||||||||||||||
Senior Vice President - |
6,690 | 3,345 | (9) | $ | 29.89 | 5/17/2012 | ||||||||||||||||||||||||||||||
Administration |
1,710 | 855 | (9) | $ | 29.89 | 5/17/2012 | ||||||||||||||||||||||||||||||
8,000 | 4,000 | (9) | $ | 30.10 | 10/16/2012 | |||||||||||||||||||||||||||||||
5,960 | 5,960 | (9) | $ | 35.62 | 10/21/2013 | 3,000 | (9) | $ | 155,340 | |||||||||||||||||||||||||||
2,400 | 3,600 | (9) | $ | 59.16 | 10/22/2014 | 5,266 | (9) | $ | 272,673 | |||||||||||||||||||||||||||
2,334 | 4,666 | (9) | $ | 54.18 | 10/25/2015 | 3,000 | (9) | $ | 155,340 | |||||||||||||||||||||||||||
| 9,800 | (9) | $ | 55.50 | 10/24/2016 | 3,600 | (9) | $ | 186,408 |
(1) | Stock options are granted with an exercise price equal to the closing stock price on the date of grant, and are subject to either a five-year vesting period, under which options vest in equal increments of 20% commencing on the first anniversary date of grant, or a three-year vesting period, under which options vest in equal increments of 33 1/3% commencing on the first anniversary of the date of grant, as provided in the award agreement. All stock option awards have a term of ten years. Upon a change of control, such as our pending merger with Forest, and certain other specified events, all stock options vest in their entirety. |
- 22 -
(2) | Restricted stock granted to the NEOs vest 100% on either the third or the fifth anniversary of the date of grant, as provided in the award agreement. Upon a change of control, such as our pending merger with Forest, and certain other specified events, all restricted stock vests in its entirety. | |
(3) | Houston Exploration has never granted equity incentive plan awards. | |
(4) | The market value of unvested restricted shares is based on the closing price of our common stock on the NYSE of $51.78 on December 29, 2006, the last trading day of the year. | |
(5) | The vesting dates for Mr. Hargetts unvested, unexercised options outstanding are as follows: options to purchase 19,000 shares vest on October 16, 2007; options to purchase 13,580 shares vest on October 21 of each of 2007 and 2008; options to purchase 5,400 shares vest on October 22 of each of 2007, 2008 and 2009; options to purchase 12,666 shares vest on October 25 of 2007 and options to purchase 12,667 shares vest on October 25, 2008; options to purchase 18,000 shares vest on October 24 of each of 2007, 2008 and 2009. The vesting dates for Mr. Hargetts unvested restricted stock are as follows: 13,000 shares vest on October 22, 2009; 17,000 shares vest on October 25, 2008; and 20,000 shares vest on October 24, 2009. | |
(6) | The vesting dates for Mr. Muellers unvested, unexercised options outstanding are as follows: options to purchase 7,800 shares vest on October 16, 2007; options to purchase 4,060 shares vest on October 21 of each of 2007 and 2008; options to purchase 1,800 shares vest on October 22 of each of 2007, 2008 and 2009; options to purchase 4,333 shares vest on October 25 of each of 2007 and 2008; options to purchase 6,667 shares vest on October 24 of each of 2007, 2008 and options to purchase 6,666 shares vest on October 24, 2009. The vesting dates for Mr. Mullers unvested restricted stock are as follows: 4,000 shares vest on October 22, 2009; 6,553 shares vest on February 8, 2010; 6,000 shares vest on October 25, 2008; and 7,000 shares vest on October 24, 2009. | |
(7) | The vesting dates for Mr. Rays unvested, unexercised options outstanding are as follows: options to purchase 6,666 shares vest on January 18, 2007 and options to purchase 6,667 shares vest on January 18 of each of 2008 and 2009; options to purchase 6,334 shares vest on October 24, 2007 and options to purchase 6,333 shares vest on October 24 of each of 2008 and 2009. The vesting dates for Mr. Rays unvested restricted stock are as follows: 7,500 shares vest on January 18, 2009 and 7,000 shares vest on October 24, 2009. | |
(8) | The vesting dates for Mr. Sherricks unvested, unexercised options outstanding are as follows: options to purchase 4,000 shares vest on April 11 of each of 2007, 2008, 2009 and 2010; options to purchase 3,000 shares vest on October 25 of each of 2007 and 2008; options to purchase 3,467 shares vest on October 24, 2007 and options to purchase 3,466 shares vest on October 24, 2008 and options to purchase 3,467 shares on October 24, 2009. The vesting dates for Mr. Sherricks unvested restricted stock are as follows: 7,500 shares vest on April 11, 2010; 4,000 shares vest on October 25, 2008; and 3,800 shares vest on October 24, 2009. | |
(9) | The vesting dates for Mr. Rices unvested, unexercised options outstanding are as follows: options to purchase 2,800 shares vest on March 1, 2007; options to purchase 3,345 shares vest and options to purchase 855 shares vest on May 17, 2007; options to purchase 4,000 shares vest on October 16, 2007; options to purchase 2,980 shares vest on October 21 of each of 2007 and 2008; options to purchase 1,200 shares vest on October 22 of each of 2007, 2008 and 2009; options to purchase 2,333 shares vest on October 25 of each of 2007 and 2008; options to purchase 3,267 shares vest on October 24, 2007; options to purchase 3,266 shares vest on October 24, 2008 and options to purchase 3,267 shares vest on October 24, 2009. The vesting dates for Mr. Rices unvested restricted stock are as follows: 3,000 shares vest on October 22, 2009; 5,266 shares vest on February 8, 2010; 3,000 shares vest on October 25, 2008; and 3,600 shares vest on October 24, 2009. |
- 23 -
Executive | Registrant | Aggregate | Aggregate | Aggregate | ||||||||||||||||
contributions | contributions | earnings | withdrawals/ | balance at | ||||||||||||||||
in last FY | in last FY | in last FY | distributions | last FYE | ||||||||||||||||
Name | ($) | ($)(1) | ($) | ($) | ($) | |||||||||||||||
William G. Hargett |
$ | 54,977 | $ | 54,977 | $ | 134,376 | $ | | $ | 1,897,171 | ||||||||||
Chairman, President
and Chief Executive
Officer |
||||||||||||||||||||
Steven L. Mueller |
$ | 193,585 | $ | 45,421 | $ | 124,511 | $ | | $ | 1,133,079 | ||||||||||
Executive Vice
President and Chief
Operating Officer |
||||||||||||||||||||
Robert T. Ray |
$ | | $ | | $ | | $ | | $ | | ||||||||||
Senior Vice
President and Chief
Financial Officer |
||||||||||||||||||||
Jeffrey B. Sherrick |
$ | 60,000 | $ | 27,647 | $ | 9,562 | $ | | $ | 120,830 | ||||||||||
Senior Vice
President -
Corporate
Development
|
||||||||||||||||||||
Roger B. Rice |
$ | 45,989 | $ | 25,138 | $ | 49,372 | $ | | $ | 446,676 | ||||||||||
Senior Vice
President -
Administration |
(1) | All company matching contributions are reflected in the All Other Compensation column of the 2006 Summary Compensation Table on page 18. |
- 24 -
- 25 -
Number of | Present Value | |||||||||||||
Years | of | |||||||||||||
Credited | Accumulated | Payments | ||||||||||||
Service | Benefit | During Last | ||||||||||||
Name | Plan Name | (#) | ($)(1) | Fiscal Year ($) | ||||||||||
William G. Hargett Chairman, President and Chief Executive Officer |
Supplemental Executive Retirement Plan |
6 | $ | 649,000 | $ | | ||||||||
Steven L. Mueller Executive Vice President and Chief Operating Officer |
Supplemental Executive Retirement Plan |
5 | $ | 252,700 | $ | | ||||||||
Robert T. Ray Senior Vice President and Chief Financial Officer |
Supplemental Executive Retirement Plan |
1 | $ | 12,600 | $ | | ||||||||
Jeffrey B. Sherrick Senior Vice President Corporate Development |
Supplemental Executive Retirement Plan |
2 | $ | 53,500 | $ | | ||||||||
Roger B. Rice Senior Vice President Administration |
Supplemental Executive Retirement Plan |
5 | $ | 394,300 | $ | |
(1) The present values shown in the table above were developed using the
assumptions discussed in Footnote (3) to the 2006 Summary Compensation Table on page 18. The
present value is based on the benefit accrued as of December 31, 2006 and does not assume any
future accrual of credited service or compensation increases. The weighted average
assumptions used to determine our benefit obligations at December 31, 2006 were (i) a discount
rate of 5.75%, and (ii) a rate of 5.00% for increases in
compensation. |
Age 65 Accrued | ||||
Name | Benefit | |||
William G. Hargett Chairman, President and Chief Executive Officer |
$ | 95,700 | ||
Steven L. Mueller Executive Vice President and Chief Operating Officer |
$ | 45,300 | ||
Robert T. Ray Senior Vice President and Chief Financial Officer |
$ | 3,600 | ||
Jeffrey B. Sherrick Senior Vice President Corporate Development |
$ | 10,500 | ||
Roger B. Rice Senior Vice President Administration |
$ | 41,600 |
-26-
For | Without | Change of | ||||||||||||||||||||||
Benefit | Voluntary(1) | Cause(2) | Death(3) | Disability(4) | Cause(5) | Control(6) | ||||||||||||||||||
William G. Hargett |
||||||||||||||||||||||||
Cash Severance |
||||||||||||||||||||||||
Multiple of Salary |
$ | - | $ | - | $ | 500,000 | $ | 180,000 | (7) | $ | 1,669,616 | $ | 1,669,616 | |||||||||||
Multiple of Bonus |
$ | - | $ | - | $ | - | $ | - | $ | 1,397,825 | $ | 1,397,825 | ||||||||||||
Stay-on Bonus(8) |
$ | - | $ | - | $ | - | $ | - | $ | - | $ | 584,375 | ||||||||||||
Total |
$ | - | $ | - | $ | 500,000 | $ | 180,000 | $ | 3,067,441 | $ | 3,651,816 | ||||||||||||
Equity(9) |
||||||||||||||||||||||||
Restricted Stock |
$ | - | $ | - | $ | 2,589,000 | $ | 2,589,000 | $ | 2,589,000 | $ | 2,589,000 | ||||||||||||
Unexercisable Options |
$ | - | $ | - | $ | 850,826 | $ | 850,826 | $ | 850,826 | $ | 850,826 | ||||||||||||
Total |
$ | - | $ | - | $ | 3,439,826 | $ | 3,439,826 | $ | 3,439,826 | $ | 3,439,826 | ||||||||||||
Retirement Benefits |
||||||||||||||||||||||||
Unvested 401(k) Plan Matching Contributions |
$ | - | $ | - | $ | - | $ | - | $ | - | $ | - | ||||||||||||
Unvested Deferred Compensation Plan Matching Contributions |
$ | - | $ | - | $ | - | $ | - | $ | - | $ | - | ||||||||||||
SERP(10) |
$ | - | $ | - | (11) | (12) | (12) | $ | 759,500 | |||||||||||||||
Total |
$ | - | $ | - | $ | - | $ | - | $ | - | $ | 759,500 | ||||||||||||
Other Benefits |
||||||||||||||||||||||||
Health & Welfare(13) |
$ | - | $ | - | $ | - | $ | - | $ | 16,500 | $ | 16,500 | ||||||||||||
Outplacement(14) |
$ | - | $ | - | $ | - | $ | - | $ | 25,000 | $ | 25,000 | ||||||||||||
Tax Gross-Ups(15) |
$ | - | $ | - | $ | - | $ | - | $ | - | $ | - | ||||||||||||
Total |
$ | - | $ | - | $ | - | $ | - | $ | 41,500 | $ | 41,500 | ||||||||||||
Total Pre-Tax Benefit |
$ | - | $ | - | $ | 3,939,826 | $ | 3,619,826 | $ | 6,548,767 | $ | 7,892,642 | ||||||||||||
Steven L. Mueller |
||||||||||||||||||||||||
Cash Severance |
||||||||||||||||||||||||
Multiple of Salary |
$ | - | $ | - | $ | 400,000 | $ | 180,000 | (7) | $ | 1,221,116 | $ | 1,221,116 | |||||||||||
Multiple of Bonus |
$ | - | $ | - | $ | - | $ | - | $ | 777,400 | $ | 777,400 | ||||||||||||
Stay-on Bonus(8) |
$ | - | $ | - | $ | - | $ | - | $ | - | $ | 325,000 | ||||||||||||
Total |
$ | - | $ | - | $ | 400,000 | $ | 180,000 | $ | 1,998,516 | $ | 2,323,516 | ||||||||||||
Equity(9) |
||||||||||||||||||||||||
Restricted Stock |
$ | - | $ | - | $ | 1,219,574 | $ | 1,219,574 | $ | 1,219,574 | $ | 1,219,574 | ||||||||||||
Unexercisable Options |
$ | - | $ | - | $ | 300,323 | $ | 300,323 | $ | 300,323 | $ | 300,323 | ||||||||||||
Total |
$ | - | $ | - | $ | 1,519,897 | $ | 1,519,897 | $ | 1,519,897 | $ | 1,519,897 | ||||||||||||
Retirement Benefits |
||||||||||||||||||||||||
Unvested 401(k) Plan Matching Contributions |
$ | - | $ | - | $ | - | $ | - | $ | - | $ | - | ||||||||||||
Unvested Deferred Compensation Plan Matching Contributions |
$ | - | $ | - | $ | - | $ | - | $ | - | $ | - | ||||||||||||
SERP(10) |
$ | - | $ | - | (11) | (12) | (12) | $ | 309,900 | |||||||||||||||
Total |
$ | - | $ | - | $ | - | $ | - | $ | - | $ | 309,900 | ||||||||||||
Other Benefits |
$ | - | $ | - | ||||||||||||||||||||
Health & Welfare(13) |
$ | - | $ | - | $ | - | $ | - | $ | 16,500 | $ | 16,500 | ||||||||||||
Outplacement(14) |
$ | - | $ | - | $ | - | $ | - | $ | 25,000 | $ | 25,000 | ||||||||||||
Tax Gross-Ups(15) |
$ | - | $ | - | $ | - | $ | - | $ | - | $ | 1,204,485 | ||||||||||||
Total |
$ | - | $ | - | $ | - | $ | - | $ | 41,500 | $ | 1,245,985 | ||||||||||||
Total Pre-Tax Benefit |
$ | - | $ | - | $ | 1,919,897 | $ | 1,699,897 | $ | 3,559,913 | $ | 5,399,298 | ||||||||||||
-27-
For | Without | Change of | ||||||||||||||||||||||
Benefit | Voluntary(1) | Cause(2) | Death(3) | Disability(4) | Cause(5) | Control(6) | ||||||||||||||||||
Robert T. Ray |
||||||||||||||||||||||||
Cash Severance |
||||||||||||||||||||||||
Multiple of Salary |
$ | - | $ | - | $ | 350,000 | $ | 180,000 | (7) | $ | 1,071,616 | $ | 1,071,616 | |||||||||||
Multiple of Bonus |
$ | - | $ | - | $ | 0 | $ | - | $ | 575,575 | $ | 575,575 | ||||||||||||
Stay-on Bonus(8) |
$ | - | $ | - | $ | 0 | $ | - | $ | - | $ | 240,625 | ||||||||||||
Total |
$ | - | $ | - | $ | 350,000 | $ | 180,000 | $ | 1,647,191 | $ | 1,887,816 | ||||||||||||
Equity(9) |
||||||||||||||||||||||||
Restricted Stock |
$ | - | $ | - | $ | 750,810 | $ | 750,810 | $ | 750,810 | $ | 750,810 | ||||||||||||
Unexercisable Options |
$ | - | $ | - | $ | - | $ | - | $ | - | $ | - | ||||||||||||
Total |
$ | - | $ | - | $ | 750,810 | $ | 750,810 | $ | 750,810 | $ | 750,810 | ||||||||||||
Retirement Benefits |
||||||||||||||||||||||||
Unvested 401(k) Plan Matching Contributions |
$ | - | $ | - | $ | 12,889 | $ | 12,889 | $ | - | $ | 12,889 | ||||||||||||
Unvested Deferred Compensation Plan Matching Contributions |
$ | - | $ | - | $ | - | $ | - | $ | - | $ | - | ||||||||||||
SERP (10) |
$ | - | $ | - | (11) | (12) | (12) | $ | 18,800 | |||||||||||||||
Total |
$ | - | $ | - | $ | 12,889 | $ | 12,889 | $ | $ | 31,689 | |||||||||||||
Other Benefits |
||||||||||||||||||||||||
Health & Welfare(13) |
$ | - | $ | - | $ | - | $ | - | $ | 16,500 | $ | 16,500 | ||||||||||||
Outplacement(14) |
$ | - | $ | - | $ | - | $ | - | $ | 25,000 | $ | 25,000 | ||||||||||||
Tax Gross-Ups(15) |
$ | - | $ | - | $ | - | $ | - | $ | - | $ | 834,874 | ||||||||||||
Total |
$ | - | $ | - | $ | - | $ | - | $ | 41,500 | $ | 876,374 | ||||||||||||
Total Pre-Tax Benefit |
$ | - | $ | - | $ | 1,113,699 | $ | 943,699 | $ | 2,439,501 | $ | 3,546,689 | ||||||||||||
Jeffrey B. Sherrick |
||||||||||||||||||||||||
Cash Severance |
||||||||||||||||||||||||
Multiple of Salary |
$ | - | $ | - | $ | 303,000 | $ | 180,000 | (7) | $ | 931,086 | $ | 931,086 | |||||||||||
Multiple of Bonus |
$ | - | $ | - | $ | - | $ | - | $ | 498,284 | $ | 498,284 | ||||||||||||
Stay-on Bonus(8) |
$ | - | $ | - | $ | - | $ | - | $ | - | $ | 208,313 | ||||||||||||
Total |
$ | - | $ | - | $ | 303,000 | $ | 180,000 | $ | 1,429,370 | $ | 1,637,683 | ||||||||||||
Equity(9) |
||||||||||||||||||||||||
Restricted Stock |
$ | - | $ | - | $ | 792,234 | $ | 792,234 | $ | 792,234 | $ | 792,234 | ||||||||||||
Unexercisable Options |
$ | - | $ | - | $ | - | $ | - | $ | - | $ | - | ||||||||||||
Total |
$ | - | $ | - | $ | 792,234 | $ | 792,234 | $ | 792,234 | $ | 792,234 | ||||||||||||
Retirement Benefits |
||||||||||||||||||||||||
Unvested 401(k) Plan Matching Contributions |
$ | - | $ | - | $ | 25,646 | $ | 25,646 | $ | - | $ | 25,646 | ||||||||||||
Unvested Deferred Compensation
Plan Matching Contributions |
$ | - | $ | - | $ | 33,889 | $ | 33,889 | $ | - | $ | 33,889 | ||||||||||||
SERP(10) |
$ | - | $ | - | (11) | (12) | (12) | $ | 66,700 | |||||||||||||||
Total |
$ | - | $ | - | $ | 59,535 | $ | 59,535 | $ | - | $ | 126,235 | ||||||||||||
Other Benefits |
||||||||||||||||||||||||
Health & Welfare(13) |
$ | - | $ | - | $ | - | $ | - | $ | 16,500 | $ | 16,500 | ||||||||||||
Outplacement(14) |
$ | - | $ | - | $ | - | $ | - | $ | 25,000 | $ | 25,000 | ||||||||||||
Tax Gross-Ups(15) |
$ | - | $ | - | $ | - | $ | - | $ | - | $ | 778,551 | ||||||||||||
Total |
$ | - | $ | - | $ | - | $ | - | $ | 41,500 | $ | 820,051 | ||||||||||||
Total Pre-Tax Benefit |
$ | - | $ | - | $ | 1,154,769 | $ | 1,031,769 | $ | 2,263,104 | $ | 3,376,203 | ||||||||||||
Roger B. Rice |
||||||||||||||||||||||||
Cash Severance |
||||||||||||||||||||||||
Multiple of Salary |
$ | - | $ | - | $ | 265,000 | 159,000 | (7) | $ | 817,466 | $ | 817,466 | ||||||||||||
Multiple of Bonus |
$ | - | $ | - | $ | - | $ | - | $ | 435,793 | $ | 435,793 | ||||||||||||
Stay-on Bonus(8) |
$ | - | $ | - | $ | - | $ | - | $ | - | $ | 182,188 | ||||||||||||
Total |
$ | - | $ | - | $ | 265,000 | $ | 159,000 | $ | 1,253,259 | $ | 1,435,447 | ||||||||||||
Equity(9) |
||||||||||||||||||||||||
Restricted Stock |
$ | - | $ | - | $ | 769,761 | $ | 769,761 | $ | 769,761 | $ | 769,761 | ||||||||||||
Unexercisable Options |
$ | - | $ | - | $ | 333,296 | $ | 333,296 | $ | 333,296 | $ | 333,296 | ||||||||||||
Total |
$ | - | $ | - | $ | 1,103,057 | $ | 1,103,057 | $ | 1,103,057 | $ | 1,103,057 | ||||||||||||
Retirement Benefits |
||||||||||||||||||||||||
Unvested 401(k) Plan Matching Contributions |
$ | - | $ | - | $ | - | $ | - | $ | - | $ | - | ||||||||||||
Unvested Deferred Compensation
Plan Matching Contributions |
$ | - | $ | - | $ | - | $ | - | $ | - | $ | - | ||||||||||||
SERP (10) |
$ | - | $ | - | (11) | (12) | (12) | $ | 439,500 | |||||||||||||||
Total |
$ | - | $ | - | $ | - | $ | - | $ | - | $ | 439,500 | ||||||||||||
Other Benefits |
||||||||||||||||||||||||
Health & Welfare(13) |
$ | - | $ | - | $ | - | $ | - | $ | 16,500 | $ | 16,500 | ||||||||||||
Outplacement(14) |
$ | - | $ | - | $ | - | $ | - | $ | 25,000 | $ | 25,000 | ||||||||||||
Tax Gross-Ups(15) |
$ | - | $ | - | $ | - | $ | - | $ | - | $ | 699,160 | ||||||||||||
Total |
$ | - | $ | - | $ | - | $ | - | $ | 41,500 | $ | 740,660 | ||||||||||||
Total Pre-Tax Benefit |
$ | - | $ | - | $ | 1,368,057 | $ | 1,262,057 | $ | 2,397,816 | $ | 3,718,664 | ||||||||||||
-28-
(1) | Voluntary termination payments shown assume all voluntary termination scenarios except for good reason. As defined in the executive employment agreements, the executive shall have good reason to terminate his or her employment within 30 days following his or her knowledge of any of the events set forth below which have not been cured by us within 15 days following the executives written notice of the occurrence of any such events: (A) a material and adverse change in the powers, duties, responsibilities or functions of the executive; or (B) subject to the following sentence, any material and adverse change in the executives relative position in our management structure; or (C) without the executives prior written consent, the relocation of our principal executive offices outside the greater Houston, Texas metropolitan area or requiring the executive to be based other than at our principal executive offices; or (D) our failure to obtain any assumption of the employment agreement by our successor; or (E) any reduction in the level of the executives base salary or target bonus, or our failure to pay the executive within ten days after a written demand therefor any installment of any previous award or deferred compensation, if any, which he or she is due and owing under any employee benefit plan or any deferred compensation program in effect in which the executive may have participated; or (F) any other material breach by us of the employment agreement. Notwithstanding the foregoing, no change of the executives relative position in our management structure (which does not otherwise materially and adversely change the powers, duties, responsibilities or functions of the executive) shall constitute good reason unless and until the occurrence of a change of control, which includes our pending merger with Forest, it being understood that prior to a change of control, the Chief Executive Officer shall have discretion to make organizational changes affecting the executive in the interest of effective corporate management as the Chief Executive Officer may determine from time to time. | |
(2) | As defined in the executive employment agreements, cause shall mean (i) any failure of the executive to (A) perform his or her principal duties in any material respect (other than any such failure resulting from the executives incapacity due to disability), (B) comply with any material provision of the executive employment agreement (other than the confidentiality and noncompetition obligations in the executive employment agreement), or (C) comply with any material provision of our ethics, code of conduct or other employment policies, in each case in (A) through (C) above after written notice of such failure has been given to the executive by the Board and such failure shall have continued for 30 days after receipt of such notice, (ii) the executives grossly negligent or intentional misconduct which is either materially detrimental to our financial interests and reputation, or which would legally prevent the executive from serving in the capacity he or she was hired to serve, (iii) a material breach by the executive of any material provision of the confidentiality or noncompetition obligations in the executive employment agreement, or (iv) conviction of or plea of guilty or no contest by the executive to a felony or any other criminal offense involving moral turpitude, any of which has or have a material adverse effect on the executives ability to perform the duties of his or her position or on our financial condition or profitability. | |
(3) | All employees are provided life insurance in an amount equal to 100% of his or her salary up to a maximum of $500,000. Circumstances of death within the parameters of accidental death and dismemberment coverage provided by us for all employees may trigger additional benefits. | |
(4) | Amounts shown in this column assume disability payments for a 12-month period. The disability benefit is salary replacement in the amount of 60% of annual base salary at the date of disability, not to exceed $15,000 per month. As defined in the executive employment agreements, disability means any physical or mental condition of the executive that (i) prevents the executive from being able to perform the services required under the executive employment agreement, (ii) has continued for at least 180 consecutive days during any 12-month period and (iii) is reasonably expected to continue. Our obligation to provide to the executive long-term disability benefits shall be defined by the long-term disability benefits contract we procure from an unrelated third party. For that purpose, the definition of disability shall be as stated in the contract. We and the executive recognize that the definition of disability may differ from the contract definition, and the benefits payable shall be those as stated in the contract. However, we agree to use good faith efforts to obtain a long-term disability benefits contract with a definition of disability as similar as possible to the definition set forth in the executive employment agreement. Moreover, we and the executive agree that for purposes of the other provisions of the executive employment agreement, including our right to terminate the executives employment, the definition of disability set forth in the executive employment agreement shall control. | |
(5) | Includes post-termination payments provided in the case of a voluntary termination with good reason by the executive. | |
(6) | For purposes of our broad-based change of control plan, a change of control is deemed to occur upon the occurrence of any of the following events: |
| a person, entity or group other than us acquires 20% or more of the combined voting power of our then outstanding voting securities; |
-29-
| we consummate a reorganization, merger (including our pending merger with Forest), consolidation or disposition of all or substantially all of our assets; or | ||
| the individuals constituting our Board on October 26, 1999 cease to constitute a majority of our Board unless the election of each new director was approved by a vote of at least a majority of the directors then still in office who were directors at the beginning of the period. |
(7) | Executive employment agreements provide for at least 60% salary replacement, not to exceed $15,000 per month, through the age 65 in the case of disability, offset by any benefit already provided under our long-term disability program. | |
(8) | In the event of a change of control, including our pending merger with Forest, each executive is entitled to a stay-on bonus equal to 1.25 times his or her target bonus under our broad-based change of control plan. | |
(9) | Value shown for equity awards reflects the full intrinsic value (the amount by which the market value of the underlying stock at the end of the period exceeds the exercise price of the option, or the market price of restricted stock at the end of the period) of unvested options and restricted shares that vest as a result of the termination scenarios shown, assuming a market value equal to the closing price of our common stock on the NYSE of $51.78 as of December 29, 2006, the last trading day of the year. | |
(10) | Termination following a change of control is the only scenario under which a lump-sum benefit is payable under the SERP. As a result, this is the only scenario under which we have included a present value number in the total benefit. Other footnoted scenarios provide for an annual benefit payable beginning at age 65. See Pension Benefits Upon Termination or Change of Control on page 34 for additional information. | |
(11) | In the case of death, the executives spouse is due a 50% survivor benefit payable on the date that the executive would have turned 65. See Pension Benefits Upon Termination or Change of Control on page 34 for additional information. | |
(12) | In the case of disability, voluntary termination for good reason, or termination by us without cause, the executive is due an annual benefit payable beginning at age 65. See Pension Benefits Upon Termination or Change of Control on page 34 for additional information. | |
(13) | Health & welfare benefit value is equal to our estimated cost of continuing health & welfare benefit coverage for one year following termination. | |
(14) | Outplacement benefits are provided in certain employment termination scenarios. We have assumed a total benefit of $25,000, which we believe is a reasonable estimate, although no specific value is placed on this benefit in our plans and agreements. | |
(15) | A tax gross-up is provided in the case of a change of control only. The gross-up payment is intended to make each executive whole in respect to excise taxes that might be imposed if a payment is determined to qualify as a parachute payment under Section 280G of the Code. As such, the payment is intended to compensate for the excise tax on the parachute payment, as well as the additional income tax and excise tax due as a result of the gross-up payment itself. Amounts shown are estimates based on termination at December 31, 2006. |
-30-
Life annuity payable to | Life annuity benefit | Lump sum benefit | ||||||
surviving spouse as | payable under the terms | payable under the terms | ||||||
Name | described in (a) above | described in (b) above | described in (c) above(1) | |||||
William G. Hargett Chairman, President and Chief Executive Officer |
$43,600 payable on February 1, 2015 |
$95,700 payable on February 1, 2015 |
$ | 759,500 | ||||
Steven L. Mueller Executive Vice President and Chief Operating Officer |
$20,600 payable on April 1, 2018 |
$45,300 payable on April 1, 2018 |
$ | 309,900 | ||||
Robert T. Ray Senior Vice President and Chief Financial Officer |
$1,600 payable on May 1, 2025 |
$3,600 payable on May 1, 2025 |
$ | 18,800 | ||||
Jeffrey B. Sherrick Senior Vice President - Corporate Development |
$4,800 payable on December 1, 2019 |
$10,500 payable on December 1, 2019 |
$ | 66,700 | ||||
Roger B. Rice Senior Vice President - Administration |
$19,100 payable on May 1, 2009 |
$41,600 payable on May 1, 2009 |
$ | 439,500 |
(1) | The present value of these lump sum amounts were calculated assuming a 30-year treasury rate of 4.75%. |
-31-
-32-
Change in pension | ||||||||||||||||||||||||||||
Fees | Non-equity | value and non- | ||||||||||||||||||||||||||
earned or | Stock | Option | incentive plan | qualified deferred | All other | |||||||||||||||||||||||
paid in | awards | Awards | compensation | compensation | compensation | Total | ||||||||||||||||||||||
Name(1) | cash ($) | ($)(2,4) | ($)(3,4) | ($) | earnings(5) | ($) | ($) | |||||||||||||||||||||
Robert B. Catell |
$ | 61,000 | $ | 65,960 | $ | | N/A | $ | (52 | ) | $ | | $ | 126,908 | ||||||||||||||
John U. Clarke |
$ | 98,000 | $ | 86,956 | $ | | N/A | $ | | $ | | $ | 184,956 | |||||||||||||||
David G. Elkins |
$ | 89,500 | $ | 87,900 | $ | | N/A | $ | | $ | | $ | 177,400 | |||||||||||||||
Harold R. Logan, Jr. |
$ | 94,500 | $ | 87,900 | $ | | N/A | $ | | $ | | $ | 182,400 | |||||||||||||||
Thomas A. McKeever |
$ | 74,500 | $ | 51,100 | $ | | N/A | $ | | $ | | $ | 125,600 | |||||||||||||||
Stephen W. McKessy |
$ | 89,500 | $ | 87,900 | $ | | N/A | $ | (505 | ) | $ | | $ | 176,895 | ||||||||||||||
Donald C. Vaughn |
$ | 90,000 | $ | 87,900 | $ | | N/A | $ | 10,942 | $ | | $ | 188,842 |
(1) | William G. Hargett, our Chief Executive Officer and Chairman of the Board, is not included in this table as he is an employee and receives no compensation for his services as a director. The compensation received by Mr. Hargett as an employee is shown in the 2006 Summary Compensation Table on page 18. | |
(2) | Reflects the dollar amount recognized for financial statement reporting purposes for the fiscal year ended December 31, 2006 in accordance with SFAS 123(R), and thus includes amounts from awards granted in and prior to 2006. A discussion of the valuation assumptions used for purposes of the SFAS 123(R) calculation is included under Note 4 to the Companys 2006 Consolidated Financial Statements set forth in the Companys Annual Report on Form 10-K, as amended, for the year ended December 31, 2006. | |
(3) | Reflects the dollar amount recognized for financial statement reporting purposes for the fiscal year ended December 31, 2006 in accordance with SFAS 123(R), and thus includes amounts from option awards granted in and prior to 2006. Beginning in 2005, our directors no longer receive stock option awards, and all previous years stock option awards were expensed in previous years. A discussion of the valuation assumptions used for purposes of the SFAS 123(R) calculation is included under Note 4 to the Companys 2006 Consolidated Financial Statements set forth in the Companys Annual Report on Form 10-K, as amended, for the year ended December 31, 2006. | |
(4) | The following table shows the aggregate number of shares of restricted and stock options outstanding for each non-employee director as of December 31, 2006, as well as the grant date fair value of stock awards made during 2006: |
Grant Date Fair | ||||||||||||||||
Aggregate Stock | Aggregate Option | Value of Stock | ||||||||||||||
Awards Outstanding | Awards Outstanding as | Stock Awarded | Awards made during | |||||||||||||
Name | of December 31, 2006 | of December 31, 2006 | during 2006 | 2006(6) | ||||||||||||
Robert B. Catell |
5,788 | 21,000 | 1,788 | $ | 100,000 | |||||||||||
John U. Clarke |
7,788 | 6,000 | 1,788 | $ | 100,000 | |||||||||||
David G. Elkins |
7,788 | 19,000 | 1,788 | $ | 100,000 | |||||||||||
Harold R. Logan, Jr. |
7,788 | 11,000 | 1,788 | $ | 100,000 | |||||||||||
Thomas A. McKeever |
3,788 | 2,000 | 1,788 | $ | 100,000 | |||||||||||
Stephen W. McKessy |
7,788 | 6,000 | 1,788 | $ | 100,000 | |||||||||||
Donald C. Vaughn |
7,788 | 23,000 | 1,788 | $ | 100,000 |
(5) | Details on the non-employee director deferred compensation plan are on page 32 under the heading Director Compensation. | |
(6) | The grant date fair value of the stock awards granted in 2006 is based on the closing price our common stock on the NYSE on April 28, 2006. Stock awards for non-employee directors are detailed under the heading Director Compensation beginning on page 32. |
-33-
-34-
| a person, entity or group other than us acquires 20% or more of the combined voting power of our then outstanding voting securities; | ||
| we consummate a reorganization, merger (including our pending merger with Forest), consolidation or disposition of all or substantially all of our assets; or | ||
| the individuals constituting our Board on October 26, 1999 cease to constitute a majority of our Board unless the election of each new director was approved by a vote of at least a majority of the directors then still in office who were directors at the beginning of the period. |
-35-
Number of Shares | Percent | |||||||
of | of | |||||||
Name of Beneficial Owner | Common Stock | Class(1) | ||||||
JANA Partners LLC(2) |
4,130,900 | 14.6 | % | |||||
200 Park Avenue, Suite 3300 New York, NY 10166 |
||||||||
Paulson & Co. Inc.(3) |
2,750,000 | 9. 8 | % | |||||
590 Madison Avenue New York, NY 10022 |
||||||||
FMR Corp.(4) |
1,564,047 | (5) | 5.5 | % | ||||
82 Devonshire Street Boston, MA 02109 |
(1) | Based upon 28,214,009 shares outstanding as of March 28, 2007. | |
(2) | Based on Schedule 13D/A (Amendment No. 11) filed on January 9, 2007 by JANA Partners LLC (JANA) and Schedule 13D filed on January 11, 2007 by Forest. The shares reflected as beneficially owned are subject to a voting agreement pursuant to which funds affiliated with JANA agreed, during the term of the voting agreement, to vote their shares of our common stock in favor of the merger with Forest and the adoption of the merger agreement and against any transaction that would impede or delay the merger with Forest, and granted to Forest a proxy to vote their shares at any stockholder meeting convened to consider such matters. According to the Schedule 13D filed by Forest, Forest has shared voting and dispositive power over, but expressly disclaims beneficial ownership of, the shares reflected as beneficially owned. | |
(3) | Based on Schedule 13G filed on February 15, 2007 by Paulson & Co. Inc. on behalf of itself and its advisory clients. | |
(4) | Based on Schedule 13G/A (Amendment No. 4) filed on February 14, 2007 by FMR Corp. (FMR) on behalf of itself and its affiliates, Pyramis Global Advisors Trust Company (PGATC) an indirect wholly-owned subsidiary of FMR; Edward C. Johnson 3D (Mr. Johnson) and FMR Corp. | |
(5) | Includes 1,555,725 shares beneficially owned by FMR Corp. as to which FMR Corp., together with Mr. Johnson have sole dispositive power. Mr. Johnson, together with PGATC, have sole dispositive power over 8,322 shares. |
-36-
Options | ||||||||||||||||
Number | Currently | |||||||||||||||
of | Exercisable Or | |||||||||||||||
Shares of | Exercisable | |||||||||||||||
Common | within 60 | Total Beneficial | Percent of | |||||||||||||
Name of Beneficial Owner | Stock(1) | days(2) | Holdings | Class(3) | ||||||||||||
William G. Hargett |
56,667 | (4) | 151,827 | 208,494 | ||||||||||||
Chairman, President and Chief Executive Officer |
||||||||||||||||
Steven L. Mueller |
23,553 | (5) | 86,314 | 109,867 | ||||||||||||
Executive Vice President and Chief Operating Officer |
||||||||||||||||
Robert T. Ray |
14,500 | (6) | 6,667 | 21,167 | ||||||||||||
Senior Vice President and Chief Financial Officer |
||||||||||||||||
Jeffrey B. Sherrick |
17,575 | (7) | 11,000 | 28,575 | ||||||||||||
Senior Vice President Corporate Development |
||||||||||||||||
James F. Westmoreland |
12,494 | (8) | 31,497 | 43,991 | ||||||||||||
Vice President and Chief Accounting Officer |
||||||||||||||||
Roger B. Rice |
14,866 | (9) | 39,694 | 54,560 | ||||||||||||
Senior Vice President Administration |
||||||||||||||||
Joanne C. Hresko |
4,700 | (10) | 14,878 | 19,578 | ||||||||||||
Vice President and General Manager Northern
Division |
||||||||||||||||
John Bergeron, Jr. |
4,700 | (11) | 11,667 | 16,367 | ||||||||||||
Vice President and General Manager Southern
Division |
||||||||||||||||
Carolyn M. Campbell |
8,900 | (12) | 5,000 | 13,900 | ||||||||||||
Senior Vice President and General Counsel |
||||||||||||||||
David G. Elkins |
12,788 | (13) | 19,000 | 31,788 | ||||||||||||
Director |
||||||||||||||||
Robert B. Catell |
9,788 | (14) | 21,000 | 30,788 | ||||||||||||
Director |
||||||||||||||||
Donald C. Vaughn |
7,788 | (15) | 23,000 | 30,788 | ||||||||||||
Director |
||||||||||||||||
Harold R. Logan, Jr. |
9,788 | (16) | 11,000 | 20,788 | ||||||||||||
Director |
||||||||||||||||
John U. Clarke |
10,788 | (17) | 6,000 | 16,788 | ||||||||||||
Director |
||||||||||||||||
Stephen W. McKessy |
7,788 | (18) | 6,000 | 13,788 | ||||||||||||
Director |
||||||||||||||||
Thomas A. McKeever |
3,788 | (19) | 2,000 | 5,788 | ||||||||||||
Director |
||||||||||||||||
All directors and executive officers as a group |
220,471 | 446,544 | 667,015 | 2.3 | % | |||||||||||
(1) | Includes shares held directly or indirectly by directors and executive officers over which they have voting power and/or the power to dispose of such shares. Unless otherwise noted, each individual or member of the group has the sole power to vote and the sole power to dispose of the shares listed as beneficially owned. | |
(2) | To reflect beneficial ownership as defined in Rule 13d-3 promulgated under the Securities Exchange Act of 1934, this column includes shares as to which each individual has the right to acquire within sixty days, other than upon consummation of our pending merger with Forest. |
-37-
(3) | Based upon 28,214,009 shares outstanding as of March 28, 2007. Percent of class is shown only for holdings of 1% or more. | |
(4) | Includes 50,000 shares of restricted stock subject to transfer restrictions expiring as follows: 17,000 shares in 2008; and 33,000 shares in 2009. | |
(5) | Includes 23,553 shares of restricted stock subject to transfer restrictions expiring as follows: 6,000 shares in 2008; 11,000 shares in 2009; and 6,553 shares in 2010. | |
(6) | Includes 14,500 shares of restricted stock subject to transfer restrictions expiring in 2009. | |
(7) | Includes 275 shares owned in a custodial account for Mr. Sherricks son and 15,300 shares of restricted stock subject to transfer restrictions expiring as follows: 4,000 shares in 2008; 3,800 shares in 2009 and 7,500 shares in 2010. | |
(8) | Includes 12,294 shares of restricted stock subject to transfer restrictions expiring as follows: 2,000 shares in 2008; 4,900 shares in 2009; and 5,394 shares in 2010. | |
(9) | Includes 14,866 shares of restricted stock subject to transfer restrictions expiring as follows: 3,000 shares in 2008; 6,600 shares in 2009; and 5,266 shares in 2010. | |
(10) | Includes 4,700 shares of restricted stock subject to transfer restrictions expiring as follows: 2,000 shares in 2008; and 2,700 shares in 2009. | |
(11) | Includes 4,700 shares of restricted stock subject to transfer restrictions expiring as follows: 2,000 shares in 2008; and 2,700 shares in 2009. | |
(12) | Includes 8,900 shares of restricted stock subject to transfer restrictions expiring in 2009. | |
(13) | Includes 7,788 shares of restricted stock subject to transfer restrictions expiring as follows: 2,000 shares in 2008; 3,788 shares in 2009; and 2,000 shares in 2010. | |
(14) | Includes 5,788 shares of restricted stock subject to transfer restrictions expiring as follows: 2,000 shares in 2008; 1,788 shares in 2009; and 2,000 shares in 2010. | |
(15) | Includes 7,788 shares of restricted stock subject to transfer restrictions expiring as follows: 2,000 shares in 2008; 3,788 shares in 2009; and 2,000 shares in 2010. | |
(16) | Includes 7,788 shares of restricted stock subject to transfer restrictions expiring as follows: 2,000 shares in 2008; 3,788 shares in 2009; and 2,000 shares in 2010. | |
(17) | Includes 7,788 shares of restricted stock subject to transfer restrictions expiring as follows: 2,000 shares in 2008; 3,788 shares in 2009; and 2,000 shares in 2010. | |
(18) | Includes 7,788 shares of restricted stock subject to transfer restrictions expiring as follows: 2,000 shares in 2008; 3,788 shares in 2009; and 2,000 in shares 2010. | |
(19) | Includes 3,788 shares of restricted stock subject to transfer restrictions expiring as follows: 1,788 shares in 2009; and 2,000 shares in 2010. |
-38-
Number of securities | ||||||||||||
to be issued upon | Weighted average | |||||||||||
exercise of | exercise price of | Number of securities | ||||||||||
outstanding options, | outstanding options, | remaining available | ||||||||||
Plan Category | warrants and rights(1) | warrants and rights | for future issuance(2) | |||||||||
Equity compensation plans
approved by stockholders |
1,536,876 | $ | 44.79 | 362,877 | ||||||||
Equity compensation plans not
approved by stockholders |
161,558 | (3) | $ | 27.64 | ¾ | |||||||
Total |
1,698,434 | $ | 43.16 | 362,877 | (4) | |||||||
(1) | Does not include (i) 41,882 outstanding restricted stock units awarded to Company employees in July 2005, one-half of which vested in January 2007 and the remaining one-half of which vest in July 2008, or (ii) restricted stock awarded to the Companys non-employee directors and executive officers. | |
(2) | Upon approval of the 2004 LTIP, existing ungranted shares from the 1996 Stock Option Plan, the 1999 Non-Qualified Stock Option Plan and the Amended and Restated 2002 Long-Term Incentive Plan were cancelled. All outstanding awards under those prior plans will remain outstanding in accordance with their terms. | |
(3) | Includes options granted under our 1999 Non-Qualified Stock Option Plan. | |
(4) | Also accounts for (i) 53,818 restricted stock units awarded to Company employees in July 2005, and (ii) restricted stock awarded to the Companys non-employee directors and executive officers. |
-39-
-40-
(1) | all officers of Houston Exploration; | ||
(2) | directors and director nominees; | ||
(3) | 5% shareholders; |
-41-
(4) | immediate family members of the foregoing individuals (broadly defined to include any child, stepchild, parent, stepparent, spouse, sibling, mother-in-law, father-in-law, son-in-law, daughter-in-law, brother-in-law, or sister-in-law); | ||
(5) | any entity controlled by any of the individuals in (1), (2), (3) or (4) above (whether through ownership, management authority or otherwise); and | ||
(6) | certain entities at which any of the individuals in (1), (2), (3) or (4) above is employed (generally, if the individual employed is directly involved in the negotiation of the transaction, has or shares responsibility at such entity for such transaction, or might receive compensation tied to such transaction). |
-42-
Fees Billed | Fees Billed | |||||||
Services Rendered | 2006 | 2005 | ||||||
Audit fees |
$ | 920,720 | (1) | $ | 693,750 | (1) | ||
Audit related fees |
27,600 | (2) | 126,103 | (3) | ||||
Tax fees |
| | ||||||
All other fees |
| | ||||||
Total |
$ | 948,320 | $ | 819,853 | ||||
(1) | Includes our annual financial statement audit, including our Sarbanes-Oxley Section 404 Certification. | |
(2) | Includes the audit of our 401(k) plan. | |
(3) | Includes (i) the review of our annual incentive compensation program calculation - $18,500; (ii) the audit of our 401(k) plan $22,000, (iii) review of a derivative transaction $46,515; and (iv) review of various potential acquisitions and dispositions - $39,088. |
-43-
PAGE | ||
Index to Financial Statements |
F-1 | |
Managements Report on Internal Controls Over Financial Reporting |
F-2 | |
Report of Independent Registered Public Accounting Firm |
F-3 | |
Consolidated Balance Sheets as of December 31, 2006 and 2005 |
F-4 | |
Consolidated Statements of Operations for the Years Ended December 31, 2006, 2005 and 2004 |
F-5 | |
Consolidated Statements of Stockholders Equity and Comprehensive Income (Loss) for the Period |
||
January 1, 2004 to December 31, 2006 |
F-6 | |
Consolidated Statements of Cash Flows for the Years Ended December 31, 2006, 2005 and 2004 |
F-7 | |
Notes to Consolidated Financial Statements |
F-8 | |
Supplemental Information on Natural Gas and Oil Exploration, Development and
Production Activities (unaudited) |
F-31 | |
Quarterly Financial Information (Unaudited) |
F-35 |
EXHIBITS | DESCRIPTION | |||
2.1
|
| Agreement and Plan of Merger dated as of January 7, 2007 by and among the Company, Forest Oil Corporation and MJCO Corporation (filed as exhibit 2.1 to our Current Report on Form 8-K dated January 7, 2007 (file No. 001-11899) and incorporated by reference herein). | ||
3.1
|
| Restated Certificate of Incorporation, as amended, including the Certificate of Amendment thereto dated April 26, 2005 (filed as exhibit 3.1 to our Quarterly Report on Form 10-Q for the period ended March 31, 2005 (file No. 001-11899) and incorporated by reference herein). | ||
3.2
|
| Restated Bylaws of The Houston Exploration Company (filed as Exhibit 3.2 to our Annual Report on Form 10-K for the year ended December 31, 2005 (File No.001-11899) and incorporated by reference). | ||
4.1
|
| Indenture, dated as of June 10, 2003, between The Houston Exploration Company and the Bank of New York, as Trustee, with respect to the 7% Senior Subordinated Notes due 2013 (filed as Exhibit 4.2 to our Registration Statement on Form S-4 (Registration No. 333-106836) and incorporated by reference). | ||
4.2
|
| Rights Agreement, dated as of August 12, 2004, between The Houston Exploration Company and The Bank of New York, as Rights Agent (filed as Exhibit 4.1 to our Current Report on Form 8-K dated August 13, 2004 (File No. 001-11899) and incorporated by reference). | ||
4.3
|
| First Amendment dated as of May 2, 2005, to the Rights Agreement dated as of August 12, 2004 between The Houston Exploration Company and The Bank of New York, as Rights Agent (filed as exhibit 4.1 to our Quarterly Report on Form 10-Q for the period ended March 31, 2005 (file No. 001-11899) and incorporated by reference herein). | ||
4.4
|
| Second Amendment to Rights Agreement dated as of January 7, 2007 between The Houston Exploration Company and The Bank of New York, as Rights Agent (filed as exhibit 4.1 to our Current Report on Form 8-K dated January 7, 2007 (file No. 001-11899) and incorporated by reference herein). |
-44-
EXHIBITS | DESCRIPTION | |||
4.5
|
| Form of Certificate of Designation of Series A Junior Participating Preferred Stock of The Houston Exploration Company (filed as Exhibit 4.2 to our Current Report on Form 8-K dated August 13, 2004 (File No. 001-11899) and incorporated by reference). | ||
10.1
|
| Amended and Restated Credit Agreement dated November 30, 2005 among The Houston Exploration Company and Wachovia Bank, National Association, as Issuing Bank and Administrative Agent; The Bank of Nova Scotia and Bank of America as Co-Syndication Agents; and BNP Paribas and Comerica Bank as Co-Documentation Agents (filed as exhibit 99.1 to our Current Report on Form 8-K dated November 30, 2005 (File No. 001-11899) and incorporated by reference). | ||
10.2
|
| First Amendment to Amended and Restated Credit Agreement effective May 31, 2006 among The Houston Exploration Company and Wachovia Bank, National Association, as Issuing Bank and Administrative Agent; The Bank of Nova Scotia and Bank of America as Co-Syndication Agents; and BNP Paribas and Comerica Bank as Co-Documentation Agents (filed as Exhibit 10.1 to our Quarterly Report on Form 10-Q for the period ended June 30, 2006 (File No. 001-11899) and incorporated by reference). | ||
10.3
|
| Purchase and Sale Agreement, dated September 3, 2003, by and among Transworld Exploration and Production, Inc., as Seller, and The Houston Exploration Company, as Buyer (filed as Exhibit 2.1 to our Current Report on Form 8-K dated October 15, 2003 (file No. 001-11899) and incorporated by reference). | ||
10.4
|
| Asset Contribution Agreement dated June 2, 2004 between The Houston Exploration Company and Seneca-Upshur Petroleum, Inc. (filed as Exhibit 99.3 to our Current Report on Form 8-K dated June 30, 2004 (File No. 001-11899) and incorporated by reference). | ||
10.5
|
| Tax Matters Agreement dated as of June 2, 2004 by and among The Houston Exploration Company, Seneca-Upshur Petroleum, Inc., THEC Holdings Corp., and KeySpan Corporation (filed as Exhibit 99.4 to our Current Report on Form 8-K dated June 30, 2004 (File No. 001-11899) and incorporated by reference). | ||
10.6
|
| Distribution Agreement dated as of June 2, 2004 by and among The Houston Exploration Company, Seneca-Upshur Petroleum, Inc., THEC Holdings Corp. and KeySpan Corporation (filed as Exhibit 99.2 to our Current Report on Form 8-K dated June 30, 2004 (File No. 001-11899) and incorporated by reference). | ||
10.7
|
| Purchase and Sale Agreement, dated September 17, 2004, between The Houston Exploration Company and Orca Energy, L.P. (filed as Exhibit 2.1 to our Current Report on Form 8-K dated November 1, 2004 (File No. 001-11899) and incorporated by reference). | ||
10.8
|
| Purchase and Sale Agreement dated October 21, 2005 by and between Kerr-McGee Oil & Gas Onshore LP D/B/A KMOG Onshore LP and Westport Oil and Gas Company, L.P., as sellers, and The Houston Exploration Company, as buyer (filed as exhibit 99.2 to our Current Report on Form 8-K dated November 30, 2005 (File No. 001-11899) and incorporated by reference). | ||
10.9
|
| Purchase and Sale Agreement dated February 28, 2006 between The Houston Exploration Company, as seller, and Merit Management Partners I, L.P., Merit Management Partners II, L.P., Merit Management Partners III, L.P., Merit Energy Partners III, L.P., Merit Energy Partners D-III, L.P., Merit Energy Partners E-III, L.P. and Merit Energy Partners F-III, L.P., collectively, as buyer (filed as Exhibit 10.1 to our Quarterly Report on Form 10-Q for the period ended March 31, 2006 (File No. 001-11899) and incorporated by reference). | ||
10.10
|
| Purchase and Sale Agreement dated April 7, 2006 between The Houston Exploration Company, as seller, and Merit Management Partners I, L.P., Merit Management Partners II, L.P., Merit Management Partners III, L.P., Merit Energy Partners III, L.P., Merit Energy Partners D-III, L.P., Merit Energy Partners E-III, L.P. and Merit Energy Partners F-III, L.P., collectively, as buyer (filed as Exhibit 99.1 to our Current Report on Form 8-K dated June 2, 2006 (File No. 001-11899) and incorporated by reference). |
-45-
EXHIBITS | DESCRIPTION | |||
10.11(2)
|
| Deferred Compensation Plan for Non-Employee Directors (filed as Exhibit 10.24 to our Annual Report on Form 10-K for the year ended December 31, 1997 (File No. 001-11899) and incorporated by reference). | ||
10.12(2)
|
| Amendment dated April 26, 2005, but effective as of December 31, 2004, to The Houston Exploration Company Non-Employee Director Deferred Compensation Plan (filed as Exhibit 10.4 to our Current Report on Form 8-K dated July 31, 2006 (File No. 001-11899) and incorporated by reference). | ||
10.13(2)
|
| The Houston Exploration Company Post-2004, AJCA Compliant Deferred Compensation Plan for Non-Employee Directors dated April 26, 2005, effective as of January 1, 2005 (filed as Exhibit 10.5 to our Current Report on Form 8-K dated July 31, 2006 (File No. 001-11899) and incorporated by reference). | ||
10.14(2)
|
| Compensation Table for Non-Employee Directors, effective January 1, 2006 (filed as exhibit 99.2 to our Current Report on Form 8-K dated January 6, 2006). | ||
10.15(2)
|
| Amended and Restated 1996 Stock Option Plan (filed as Exhibit 10.1 to our Quarterly Report on Form 10-Q for the quarter ended June 30, 1998 (File No. 001-11899) and incorporated by reference). | ||
10.16(2)
|
| 1999 Non-Qualified Stock Option Plan dated October 26, 1999 (filed as Exhibit 10.24 to our Annual Report on Form 10-K for the year ended December 31, 1999 (File No. 001-11899) and incorporated by reference). | ||
10.17(2)
|
| Amended and Restated 2002 Long-Term Incentive Plan effective May 17, 2002, adopted October 26, 2003 (filed as Exhibit 10.31 to our Annual Report on Form 10-K for the year ended December 31, 2003 (File No. 001-11899) and incorporated by reference). | ||
10.18(2)
|
| Amended and Restated 2004 Long Term Incentive Plan (filed as exhibit 99.1 to our Current Report on Form 8-K dated January 31, 2006 (File No. 001-11899) and incorporated by reference). | ||
10.19(2)
|
| Supplemental Executive Pension Plan dated May 1, 1996 (filed as exhibit 10.23 to our Registration Statement on Form S-1/A (Amendment No. 2) (Registration No. 333-4437) and incorporated by reference). | ||
10.20(2)
|
| The Houston Exploration Company Supplemental Executive Retirement Plan (Amended and Restated on July 25, 2006) (filed as Exhibit 10.1 to our Current Report on Form 8-K dated July 31, 2006 (File No. 001-11899) and incorporated by reference). | ||
10.21(2)
|
| First Amendment to The Houston Exploration Company Supplemental Executive Retirement Plan (filed as exhibit 10.3 to our Current Report on Form 8-K dated January 7, 2007 (File No. 001-11899) and incorporated by reference herein). | ||
10.22(2)
|
| Executive Deferred Compensation Plan dated January 1, 2002 (filed as Exhibit 10.28 to our Annual Report on Form 10-K for the year ended December 31, 2002 (File No. 001-11899) and incorporated by reference). | ||
10.23(2)
|
| Amendment [No. 1] to The Houston Exploration Company Executive Deferred Compensation Plan (filed as exhibit 99.2 to our Current Report on Form 8-K dated January 31, 2006 (File No. 001-11899) and incorporated by reference). | ||
10.24(2)
|
| Amendment No. 2 dated July 25, 2006, but effective as of December 31, 2004, to The Houston Exploration Company Executive Deferred Compensation Plan (filed as Exhibit 10.2 to our Current Report on Form 8-K dated July 31, 2006 (File No. 001-11899) and incorporated by reference). | ||
10.25(2)
|
| The Houston Exploration Company 2005 Executive Deferred Compensation Plan (filed as Exhibit 10.3 to our Current Report on Form 8-K dated July 31, 2006 (File No. 001-11899) and incorporated by reference). | ||
10.26(2)
|
| Amended and Restated Employment Agreement dated February 8, 2005 between The Houston Exploration Company and William G. Hargett (filed as Exhibit 10.1 to our Current Report on Form 8-K dated February 8, 2005 (File No. 001-11899) and incorporated by reference). |
-46-
EXHIBITS | DESCRIPTION | |||
10.27(2)
|
| Amendment No. 1, dated October 24, 2006, to the Amended and Restated Employment Agreement dated February 8, 2005 between The Houston Exploration Company and William G. Hargett (filed as Exhibit 10.1 to our Current Report on Form 8-K dated October 27, 2006 (File No. 001-11899) and incorporated by reference). | ||
10.38(2)
|
| Amended and Restated Employment Agreement between The Houston Exploration Company and Steven L. Mueller dated February 8, 2005 (filed as Exhibit 10.19 to our Annual Report on Form 10-K for the year ended December 31, 2004 (File No. 001-11899) and incorporated by reference). | ||
10.29(2)
|
| Amendment No. 1, dated October 24, 2006, to the Amended and Restated Employment Agreement dated February 8, 2005 between The Houston Exploration Company and Steven L. Mueller (filed as Exhibit 10.2 to our Current Report on Form 8-K dated October 27, 2006 (File No. 001-11899) and incorporated by reference). | ||
10.30(2)
|
| Amended and Restated Employment Agreement between The Houston Exploration Company and John H. Karnes dated February 8, 2005 (filed as Exhibit 10.20 to our Annual Report on Form 10-K for the year ended December 31, 2004 (File No. 001-11899) and incorporated by reference). | ||
10.31(2)
|
| Separation Agreement and General Release dated December 8, 2005 between The Houston Exploration Company and John H. Karnes (filed as exhibit 99.1 to our Current Report on Form 8-K dated December 12, 2005 (File No. 001-11899) and incorporated by reference). | ||
10.32(2)
|
| Amended and Restated Employment Agreement between The Houston Exploration Company and James F. Westmoreland dated February 8, 2005 (filed as Exhibit 10.21 to our Annual Report on Form 10-K for the year ended December 31, 2004 (File No. 001-11899) and incorporated by reference). | ||
10.33(2)
|
| Amendment No. 1, dated October 24, 2006, to the Amended and Restated Employment Agreement dated February 8, 2005 between The Houston Exploration Company and James F. Westmoreland (filed as Exhibit 10.7 to our Current Report on Form 8-K dated October 27, 2006 (File No. 001-11899) and incorporated by reference). | ||
10.34(2)
|
| Amended and Restated Employment Agreement between The Houston Exploration Company and Roger B. Rice dated February 8, 2005 (filed as Exhibit 10.22 to our Annual Report on Form 10-K for the year ended December 31, 2004 (File No. 001-11899) and incorporated by reference). | ||
10.35(2)
|
| Amendment No. 1, dated October 24, 2006, to the Amended and Restated Employment Agreement dated February 8, 2005 between The Houston Exploration Company and Roger B. Rice (filed as Exhibit 10.5 to our Current Report on Form 8-K dated October 27, 2006 (File No. 001-11899) and incorporated by reference). | ||
10.36(2)
|
| Employment Agreement dated February 10, 2005 between The Houston Exploration Company and Joanne C. Hresko (filed as Exhibit 10.3 to our Current Report on Form 8-K dated February 8, 2005 (File No. 001-11899) and incorporated by reference). | ||
10.37(2)
|
| Amendment No. 1, dated October 24, 2006, to the Employment Agreement dated February 10, 2005, between The Houston Exploration Company and Joanne C. Hresko (filed as Exhibit 10.8 to our Current Report on Form 8-K dated October 27, 2006 (File No. 001-11899) and incorporated by reference). | ||
10.38(2)
|
| Employment Agreement effective March 10, 2005, between The Houston Exploration Company and John E. Bergeron, Jr. (filed as exhibit 99.2 to our Current Report on Form 8-K dated March 10, 2005 (File No. 001-11899) and incorporated by reference). | ||
10.39(2)
|
| Amendment No. 1, dated October 24, 2006, to the Employment Agreement dated March 10, 2005, between The Houston Exploration Company and John E. Bergeron, Jr. (filed as Exhibit 10.9 to our Current Report on Form 8-K dated October 27, 2006 (File No. 001-11899) and incorporated by reference). |
-47-
EXHIBITS | DESCRIPTION | |||
10.40(2)
|
| Employment Agreement effective April 13, 2005, between The Houston Exploration Company and Jeffrey B. Sherrick (filed as exhibit 99.2 to our Current Report on Form 8-K dated April 13, 2005 (File No. 001-11899) and incorporated by reference). | ||
10.41(2)
|
| Amendment No. 1, dated October 24, 2006, to the Employment Agreement dated April 13, 2005, between The Houston Exploration Company and Jeffrey B. Sherrick (filed as Exhibit 10.6 to our Current Report on Form 8-K dated October 27, 2006 (File No. 001-11899) and incorporated by reference). | ||
10.42(2)
|
| Employment Agreement dated January 18, 2006 between The Houston Exploration Company and Robert T. Ray (filed as exhibit 99.1 to our Current Report on Form 8-K dated January 18, 2006 (File No. 001-11899) and incorporated by reference). | ||
10.43(2)
|
| Amendment No. 1, dated October 24, 2006, to the Employment Agreement dated January 18, 2006, between The Houston Exploration Company and Robert T. Ray (filed as Exhibit 10.3 to our Current Report on Form 8-K dated October 27, 2006 (File No. 001-11899) and incorporated by reference). | ||
10.44(2)
|
| Employment Agreement dated March 27, 2006 between The Houston Exploration Company and Carolyn M. Campbell (filed as Exhibit 99.1 to our Current Report on Form 8-K dated March 27, 2006 (File No. 001-11899) and incorporated by reference). | ||
10.45(2)
|
| Amendment No. 1, dated October 24, 2006, to the Employment Agreement dated March 27, 2006, between The Houston Exploration Company and Carolyn M. Campbell (filed as Exhibit 10.4 to our Current Report on Form 8-K dated October 27, 2006 (File No. 001-11899) and incorporated by reference). | ||
10.46(2)
|
| Form of Amendment No. 2 to [Amended and Restated] Employment Agreement entered into by and between The Houston Exploration Company and each of William G. Hargett, Steven L. Mueller, James F. Westmoreland, Roger B. Rice, Joanne C. Hresko, John E. Bergeron Jr., Jeffrey B. Sherrick, Robert T. Ray and Carolyn M. Campbell (filed as Exhibit 10.1 to our Current Report on Form 8-K dated January 7, 2007 (file No. 001-11899) and incorporated by reference herein). | ||
10.47(2)
|
| Change of Control Plan dated October 26, 1999 (filed as Exhibit 10.25 to our Annual Report on Form 10-K for the year ended December 31, 1999 (File No. 001-11899) and incorporated by reference). | ||
10.48(2)
|
| First Amendment to The Houston Exploration Company Change of Control Plan dated May 17, 2002 (filed as Exhibit 10.48 to our Annual Report on Form 10-K for the year ended December 31, 2006 (File No. 001-11899) and incorporated by reference). | ||
10.49(2)
|
| Second Amendment to The Houston Exploration Company Change of Control Plan (filed as exhibit 10.4 to our Current Report on Form 8-K dated January 7, 2007 (file No. 001-11899) and incorporated by reference herein). | ||
10.50(2)
|
| Form of Indemnification Agreement for Directors and Executive Officers (filed as Exhibit 10.8 to our Quarterly Report on Form 10-Q for the period ended June 30, 2006 (File No. 001-11899) and incorporated by reference). | ||
10.51(2)
|
| Form of Non-Qualified Stock Option Agreement (filed as Exhibit 10.9 to our Quarterly Report on Form 10-Q for the period ended June 30, 2006 (File No. 001-11899) and incorporated by reference). | ||
10.52(2)
|
| Form of Director Restricted Stock Award Agreement (filed as Exhibit 10.10 to our Quarterly Report on Form 10-Q for the period ended June 30, 2006 (File No. 001-11899) and incorporated by reference). | ||
10.53(2)
|
| Form of Employee Restricted Stock Award Agreement (filed as Exhibit 10.11 to our Quarterly Report on Form 10-Q for the period ended June 30, 2006 (File No. 001-11899) and incorporated by reference). | ||
12.1
|
| Computation of ratio of earnings to fixed charges (filed as Exhibit 10.48 to our Annual Report on Form 10-K for the year ended December 31, 2006 (File No. 001-11899) and incorporated by reference). | ||
21.1
|
| Subsidiaries of The Houston Exploration Company (filed as Exhibit 10.48 to our Annual Report on Form 10-K for the year ended December 31, 2006 (File No. 001-11899) and incorporated by reference). |
-48-
EXHIBITS | DESCRIPTION | |||
23.1
|
| Consent of Deloitte & Touche LLP (filed as Exhibit 23.1 to our Annual Report on Form 10-K for the year ended December 31, 2006 (File No. 001-11899) and incorporated by reference). | ||
23.2
|
| Consent of Netherland, Sewell & Associates (filed as Exhibit 23.2 to our Annual Report on Form 10-K for the year ended December 31, 2006 (File No. 001-11899) and incorporated by reference). | ||
23.3
|
| Consent of Miller and Lents (filed as Exhibit 23.3 to our Annual Report on Form 10-K for the year ended December 31, 2006 (File No. 001-11899) and incorporated by reference). | ||
31.1(1)
|
| Certification of William G. Hargett, Chief Executive Officer, as required pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | ||
31.2(1)
|
| Certification of Robert T. Ray, Chief Financial Officer, as required pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | ||
32.1
|
| Certification of William G. Hargett, Chief Executive Officer, as required pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (filed as Exhibit 32.1 to our Annual Report on Form10-K/A (Amendment No. 1) for the year ended December 31, 2006 (File No. 001-11899) and incorporated by reference). | ||
32.2
|
| Certification of Robert T. Ray, Chief Financial Officer, as required pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (filed as Exhibit 32.2 to our Annual Report on Form10-K/A (Amendment No. 1) for the year ended December 31, 2006 (File No. 001-11899) and incorporated by reference). |
(1) Filed herewith. | ||
(2) Management contract or compensation plan. |
-49-
THE HOUSTON EXPLORATION COMPANY |
||||
By: | /s/ William G. Hargett | |||
William G. Hargett | ||||
Date: April 2, 2007 | President and Chief Executive Officer |
-50-
Signature | Title | Date | ||
/s/ William G. Hargett
|
Chairman of the Board of Directors, | April 2, 2007 | ||
President and Chief Executive Officer (Principal Executive Officer) |
||||
/s/ Robert T. Ray
|
Senior Vice President and Chief Financial Officer | April 2, 2007 | ||
(Principal Financial Officer) | ||||
/s/ James F. Westmoreland
|
Vice President and Chief Accounting Officer | April 2, 2007 | ||
(Principal Accounting Officer) | ||||
*
|
Director | April 2, 2007 | ||
*
|
Director | April 2, 2007 | ||
*
|
Director | April 2, 2007 | ||
*
|
Director | April 2, 2007 | ||
Harold R. Logan, Jr. |
||||
*
|
Director | April 2, 2007 | ||
*
|
Director | April 2, 2007 | ||
*
|
Director | April 2, 2007 | ||
*By: /s/ James F. Westmoreland |
||||
Attorney-in-Fact |
EXHIBITS | DESCRIPTION | |||
2.1
|
| Agreement and Plan of Merger dated as of January 7, 2007 by and among the Company, Forest Oil Corporation and MJCO Corporation (filed as exhibit 2.1 to our Current Report on Form 8-K dated January 7, 2007 (file No. 001-11899) and incorporated by reference herein). | ||
3.1
|
| Restated Certificate of Incorporation, as amended, including the Certificate of Amendment thereto dated April 26, 2005 (filed as exhibit 3.1 to our Quarterly Report on Form 10-Q for the period ended March 31, 2005 (file No. 001-11899) and incorporated by reference herein). | ||
3.2
|
| Restated Bylaws of The Houston Exploration Company (filed as Exhibit 3.2 to our Annual Report on Form 10-K for the year ended December 31, 2005 (File No.001-11899) and incorporated by reference). | ||
4.1
|
| Indenture, dated as of June 10, 2003, between The Houston Exploration Company and the Bank of New York, as Trustee, with respect to the 7% Senior Subordinated Notes due 2013 (filed as Exhibit 4.2 to our Registration Statement on Form S-4 (Registration No. 333-106836) and incorporated by reference). | ||
4.2
|
| Rights Agreement, dated as of August 12, 2004, between The Houston Exploration Company and The Bank of New York, as Rights Agent (filed as Exhibit 4.1 to our Current Report on Form 8-K dated August 13, 2004 (File No. 001-11899) and incorporated by reference). | ||
4.3
|
| First Amendment dated as of May 2, 2005, to the Rights Agreement dated as of August 12, 2004 between The Houston Exploration Company and The Bank of New York, as Rights Agent (filed as exhibit 4.1 to our Quarterly Report on Form 10-Q for the period ended March 31, 2005 (file No. 001-11899) and incorporated by reference herein). | ||
4.4
|
| Second Amendment to Rights Agreement dated as of January 7, 2007 between The Houston Exploration Company and The Bank of New York, as Rights Agent (filed as exhibit 4.1 to our Current Report on Form 8-K dated January 7, 2007 (file No. 001-11899) and incorporated by reference herein). |
-51-
EXHIBITS | DESCRIPTION | |||
4.5
|
| Form of Certificate of Designation of Series A Junior Participating Preferred Stock of The Houston Exploration Company (filed as Exhibit 4.2 to our Current Report on Form 8-K dated August 13, 2004 (File No. 001-11899) and incorporated by reference). | ||
10.1
|
| Amended and Restated Credit Agreement dated November 30, 2005 among The Houston Exploration Company and Wachovia Bank, National Association, as Issuing Bank and Administrative Agent; The Bank of Nova Scotia and Bank of America as Co-Syndication Agents; and BNP Paribas and Comerica Bank as Co-Documentation Agents (filed as exhibit 99.1 to our Current Report on Form 8-K dated November 30, 2005 (File No. 001-11899) and incorporated by reference). | ||
10.2
|
| First Amendment to Amended and Restated Credit Agreement effective May 31, 2006 among The Houston Exploration Company and Wachovia Bank, National Association, as Issuing Bank and Administrative Agent; The Bank of Nova Scotia and Bank of America as Co-Syndication Agents; and BNP Paribas and Comerica Bank as Co-Documentation Agents (filed as Exhibit 10.1 to our Quarterly Report on Form 10-Q for the period ended June 30, 2006 (File No. 001-11899) and incorporated by reference). | ||
10.3
|
| Purchase and Sale Agreement, dated September 3, 2003, by and among Transworld Exploration and Production, Inc., as Seller, and The Houston Exploration Company, as Buyer (filed as Exhibit 2.1 to our Current Report on Form 8-K dated October 15, 2003 (file No. 001-11899) and incorporated by reference). | ||
10.4
|
| Asset Contribution Agreement dated June 2, 2004 between The Houston Exploration Company and Seneca-Upshur Petroleum, Inc. (filed as Exhibit 99.3 to our Current Report on Form 8-K dated June 30, 2004 (File No. 001-11899) and incorporated by reference). | ||
10.5
|
| Tax Matters Agreement dated as of June 2, 2004 by and among The Houston Exploration Company, Seneca-Upshur Petroleum, Inc., THEC Holdings Corp., and KeySpan Corporation (filed as Exhibit 99.4 to our Current Report on Form 8-K dated June 30, 2004 (File No. 001-11899) and incorporated by reference). | ||
10.6
|
| Distribution Agreement dated as of June 2, 2004 by and among The Houston Exploration Company, Seneca-Upshur Petroleum, Inc., THEC Holdings Corp. and KeySpan Corporation (filed as Exhibit 99.2 to our Current Report on Form 8-K dated June 30, 2004 (File No. 001-11899) and incorporated by reference). | ||
10.7
|
| Purchase and Sale Agreement, dated September 17, 2004, between The Houston Exploration Company and Orca Energy, L.P. (filed as Exhibit 2.1 to our Current Report on Form 8-K dated November 1, 2004 (File No. 001-11899) and incorporated by reference). | ||
10.8
|
| Purchase and Sale Agreement dated October 21, 2005 by and between Kerr-McGee Oil & Gas Onshore LP D/B/A KMOG Onshore LP and Westport Oil and Gas Company, L.P., as sellers, and The Houston Exploration Company, as buyer (filed as exhibit 99.2 to our Current Report on Form 8-K dated November 30, 2005 (File No. 001-11899) and incorporated by reference). | ||
10.9
|
| Purchase and Sale Agreement dated February 28, 2006 between The Houston Exploration Company, as seller, and Merit Management Partners I, L.P., Merit Management Partners II, L.P., Merit Management Partners III, L.P., Merit Energy Partners III, L.P., Merit Energy Partners D-III, L.P., Merit Energy Partners E-III, L.P. and Merit Energy Partners F-III, L.P., collectively, as buyer (filed as Exhibit 10.1 to our Quarterly Report on Form 10-Q for the period ended March 31, 2006 (File No. 001-11899) and incorporated by reference). | ||
10.10
|
| Purchase and Sale Agreement dated April 7, 2006 between The Houston Exploration Company, as seller, and Merit Management Partners I, L.P., Merit Management Partners II, L.P., Merit Management Partners III, L.P., Merit Energy Partners III, L.P., Merit Energy Partners D-III, L.P., Merit Energy Partners E-III, L.P. and Merit Energy Partners F-III, L.P., collectively, as buyer (filed as Exhibit 99.1 to our Current Report on Form 8-K dated June 2, 2006 (File No. 001-11899) and incorporated by reference). |
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EXHIBITS | DESCRIPTION | |||
10.11(2)
|
| Deferred Compensation Plan for Non-Employee Directors (filed as Exhibit 10.24 to our Annual Report on Form 10-K for the year ended December 31, 1997 (File No. 001-11899) and incorporated by reference). | ||
10.12(2)
|
| Amendment dated April 26, 2005, but effective as of December 31, 2004, to The Houston Exploration Company Non-Employee Director Deferred Compensation Plan (filed as Exhibit 10.4 to our Current Report on Form 8-K dated July 31, 2006 (File No. 001-11899) and incorporated by reference). | ||
10.13(2)
|
| The Houston Exploration Company Post-2004, AJCA Compliant Deferred Compensation Plan for Non-Employee Directors dated April 26, 2005, effective as of January 1, 2005 (filed as Exhibit 10.5 to our Current Report on Form 8-K dated July 31, 2006 (File No. 001-11899) and incorporated by reference). | ||
10.14(2)
|
| Compensation Table for Non-Employee Directors, effective January 1, 2006 (filed as exhibit 99.2 to our Current Report on Form 8-K dated January 6, 2006). | ||
10.15(2)
|
| Amended and Restated 1996 Stock Option Plan (filed as Exhibit 10.1 to our Quarterly Report on Form 10-Q for the quarter ended June 30, 1998 (File No. 001-11899) and incorporated by reference). | ||
10.16(2)
|
| 1999 Non-Qualified Stock Option Plan dated October 26, 1999 (filed as Exhibit 10.24 to our Annual Report on Form 10-K for the year ended December 31, 1999 (File No. 001-11899) and incorporated by reference). | ||
10.17(2)
|
| Amended and Restated 2002 Long-Term Incentive Plan effective May 17, 2002, adopted October 26, 2003 (filed as Exhibit 10.31 to our Annual Report on Form 10-K for the year ended December 31, 2003 (file No. 001-11899) and incorporated by reference). | ||
10.18(2)
|
| Amended and Restated 2004 Long Term Incentive Plan (filed as exhibit 99.1 to our Current Report on Form 8-K dated January 31, 2006 (File No. 001-11899) and incorporated by reference). | ||
10.19(2)
|
| Supplemental Executive Pension Plan dated May 1, 1996 (filed as exhibit 10.23 to our Registration Statement on Form S-1/A (Amendment No. 2) (Registration No. 333-4437) and incorporated by reference). | ||
10.20(2)
|
| The Houston Exploration Company Supplemental Executive Retirement Plan (Amended and Restated on July 25, 2006) (filed as Exhibit 10.1 to our Current Report on Form 8-K dated July 31, 2006 (File No. 001-11899) and incorporated by reference). | ||
10.21(2)
|
| First Amendment to The Houston Exploration Company Supplemental Executive Retirement Plan (filed as exhibit 10.3 to our Current Report on Form 8-K dated January 7, 2007 (file No. 001-11899) and incorporated by reference herein). | ||
10.22(2)
|
| Executive Deferred Compensation Plan dated January 1, 2002 (filed as Exhibit 10.28 to our Annual Report on Form 10-K for the year ended December 31, 2002 (File No. 001-11899) and incorporated by reference). | ||
10.23(2)
|
| Amendment [No. 1] to The Houston Exploration Company Executive Deferred Compensation Plan (filed as exhibit 99.2 to our Current Report on Form 8-K dated January 31, 2006 (File No. 001-11899) and incorporated by reference). | ||
10.24(2)
|
| Amendment No. 2 dated July 25, 2006, but effective as of December 31, 2004, to The Houston Exploration Company Executive Deferred Compensation Plan (filed as Exhibit 10.2 to our Current Report on Form 8-K dated July 31, 2006 (File No. 001-11899) and incorporated by reference). | ||
10.25(2)
|
| The Houston Exploration Company 2005 Executive Deferred Compensation Plan (filed as Exhibit 10.3 to our Current Report on Form 8-K dated July 31, 2006 (File No. 001-11899) and incorporated by reference). | ||
10.26(2)
|
| Amended and Restated Employment Agreement dated February 8, 2005 between The Houston Exploration Company and William G. Hargett (filed as Exhibit 10.1 to our Current Report on Form 8-K dated February 8, 2005 (File No. 001-11899) and incorporated by reference). |
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EXHIBITS | DESCRIPTION | |||
10.27(2)
|
| Amendment No. 1, dated October 24, 2006, to the Amended and Restated Employment Agreement dated February 8, 2005 between The Houston Exploration Company and William G. Hargett (filed as Exhibit 10.1 to our Current Report on Form 8-K dated October 27, 2006 (File No. 001-11899) and incorporated by reference). | ||
10.38(2)
|
| Amended and Restated Employment Agreement between The Houston Exploration Company and Steven L. Mueller dated February 8, 2005 (filed as Exhibit 10.19 to our Annual Report on Form 10-K for the year ended December 31, 2004 (File No. 001-11899) and incorporated by reference). | ||
10.29(2)
|
| Amendment No. 1, dated October 24, 2006, to the Amended and Restated Employment Agreement dated February 8, 2005 between The Houston Exploration Company and Steven L. Mueller (filed as Exhibit 10.2 to our Current Report on Form 8-K dated October 27, 2006 (File No. 001-11899) and incorporated by reference). | ||
10.30(2)
|
| Amended and Restated Employment Agreement between The Houston Exploration Company and John H. Karnes dated February 8, 2005 (filed as Exhibit 10.20 to our Annual Report on Form 10-K for the year ended December 31, 2004 (File No. 001-11899) and incorporated by reference). | ||
10.31(2)
|
| Separation Agreement and General Release dated December 8, 2005 between The Houston Exploration Company and John H. Karnes (filed as exhibit 99.1 to our Current Report on Form 8-K dated December 12, 2005 (File No. 001-11899) and incorporated by reference). | ||
10.32(2)
|
| Amended and Restated Employment Agreement between The Houston Exploration Company and James F. Westmoreland dated February 8, 2005 (filed as Exhibit 10.21 to our Annual Report on Form 10-K for the year ended December 31, 2004 (File No. 001-11899) and incorporated by reference). | ||
10.33(2)
|
| Amendment No. 1, dated October 24, 2006, to the Amended and Restated Employment Agreement dated February 8, 2005 between The Houston Exploration Company and James F. Westmoreland (filed as Exhibit 10.7 to our Current Report on Form 8-K dated October 27, 2006 (File No. 001-11899) and incorporated by reference). | ||
10.34(2)
|
| Amended and Restated Employment Agreement between The Houston Exploration Company and Roger B. Rice dated February 8, 2005 (filed as Exhibit 10.22 to our Annual Report on Form 10-K for the year ended December 31, 2004 (File No. 001-11899) and incorporated by reference). | ||
10.35(2)
|
| Amendment No. 1, dated October 24, 2006, to the Amended and Restated Employment Agreement dated February 8, 2005 between The Houston Exploration Company and Roger B. Rice (filed as Exhibit 10.5 to our Current Report on Form 8-K dated October 27, 2006 (File No. 001-11899) and incorporated by reference). | ||
10.36(2)
|
| Employment Agreement dated February 10, 2005 between The Houston Exploration Company and Joanne C. Hresko (filed as Exhibit 10.3 to our Current Report on Form 8-K dated February 8, 2005 (File No. 001-11899) and incorporated by reference). | ||
10.37(2)
|
| Amendment No. 1, dated October 24, 2006, to the Employment Agreement dated February 10, 2005, between The Houston Exploration Company and Joanne C. Hresko (filed as Exhibit 10.8 to our Current Report on Form 8-K dated October 27, 2006 (File No. 001-11899) and incorporated by reference). | ||
10.38(2)
|
| Employment Agreement effective March 10, 2005, between The Houston Exploration Company and John E. Bergeron, Jr. (filed as exhibit 99.2 to our Current Report on Form 8-K dated March 10, 2005 (File No. 001-11899) and incorporated by reference). | ||
10.39(2)
|
| Amendment No. 1, dated October 24, 2006, to the Employment Agreement dated March 10, 2005, between The Houston Exploration Company and John E. Bergeron, Jr. (filed as Exhibit 10.9 to our Current Report on Form 8-K dated October 27, 2006 (File No. 001-11899) and incorporated by reference). |
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EXHIBITS | DESCRIPTION | |||
10.40(2)
|
| Employment Agreement effective April 13, 2005, between The Houston Exploration Company and Jeffrey B. Sherrick (filed as exhibit 99.2 to our Current Report on Form 8-K dated April 13, 2005 (File No. 001-11899) and incorporated by reference). | ||
10.41(2)
|
| Amendment No. 1, dated October 24, 2006, to the Employment Agreement dated April 13, 2005, between The Houston Exploration Company and Jeffrey B. Sherrick (filed as Exhibit 10.6 to our Current Report on Form 8-K dated October 27, 2006 (File No. 001-11899) and incorporated by reference). | ||
10.42(2)
|
| Employment Agreement dated January 18, 2006 between The Houston Exploration Company and Robert T. Ray (filed as exhibit 99.1 to our Current Report on Form 8-K dated January 18, 2006 (File No. 001-11899) and incorporated by reference). | ||
10.43(2)
|
| Amendment No. 1, dated October 24, 2006, to the Employment Agreement dated January 18, 2006, between The Houston Exploration Company and Robert T. Ray (filed as Exhibit 10.3 to our Current Report on Form 8-K dated October 27, 2006 (File No. 001-11899) and incorporated by reference). | ||
10.44(2)
|
| Employment Agreement dated March 27, 2006 between The Houston Exploration Company and Carolyn M. Campbell (filed as Exhibit 99.1 to our Current Report on Form 8-K dated March 27, 2006 (File No. 001-11899) and incorporated by reference). | ||
10.45(2)
|
| Amendment No. 1, dated October 24, 2006, to the Employment Agreement dated March 27, 2006, between The Houston Exploration Company and Carolyn M. Campbell (filed as Exhibit 10.4 to our Current Report on Form 8-K dated October 27, 2006 (File No. 001-11899) and incorporated by reference). | ||
10.46(2)
|
| Form of Amendment No. 2 to [Amended and Restated] Employment Agreement entered into by and between The Houston Exploration Company and each of William G. Hargett, Steven L. Mueller, James F. Westmoreland, Roger B. Rice, Joanne C. Hresko, John E. Bergeron Jr., Jeffrey B. Sherrick, Robert T. Ray and Carolyn M. Campbell (filed as Exhibit 10.1 to our Current Report on Form 8-K dated January 7, 2007 (file No. 001-11899) and incorporated by reference herein). | ||
10.47(2)
|
| Change of Control Plan dated October 26, 1999 (filed as Exhibit 10.25 to our Annual Report on Form 10-K for the year ended December 31, 1999 (File No. 001-11899) and incorporated by reference). | ||
10.48(2)
|
| First Amendment to The Houston Exploration Company Change of Control Plan dated May 17, 2002 (filed as Exhibit 10.48 to our Annual Report on Form 10-K for the year ended December 31, 2006 (File No. 001-11899) and incorporated by reference). | ||
10.49(2)
|
| Second Amendment to The Houston Exploration Company Change of Control Plan (filed as exhibit 10.4 to our Current Report on Form 8-K dated January 7, 2007 (file No. 001-11899) and incorporated by reference herein). | ||
10.50(2)
|
| Form of Indemnification Agreement for Directors and Executive Officers (filed as Exhibit 10.8 to our Quarterly Report on Form 10-Q for the period ended June 30, 2006 (File No. 001-11899) and incorporated by reference). | ||
10.51(2)
|
| Form of Non-Qualified Stock Option Agreement (filed as Exhibit 10.9 to our Quarterly Report on Form 10-Q for the period ended June 30, 2006 (File No. 001-11899) and incorporated by reference). | ||
10.52(2)
|
| Form of Director Restricted Stock Award Agreement (filed as Exhibit 10.10 to our Quarterly Report on Form 10-Q for the period ended June 30, 2006 (File No. 001-11899) and incorporated by reference). | ||
10.53(2)
|
| Form of Employee Restricted Stock Award Agreement (filed as Exhibit 10.11 to our Quarterly Report on Form 10-Q for the period ended June 30, 2006 (File No. 001-11899) and incorporated by reference). | ||
12.1
|
| Computation of ratio of earnings to fixed charges (filed as Exhibit 10.48 to our Annual Report on Form 10-K for the year ended December 31, 2006 (File No. 001-11899) and incorporated by reference). | ||
21.1
|
| Subsidiaries of The Houston Exploration Company (filed as Exhibit 10.48 to our Annual Report on Form 10-K for the year ended December 31, 2006 (File No. 001-11899) and incorporated by reference). |
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EXHIBITS | DESCRIPTION | |||
23.1
|
| Consent of Deloitte & Touche LLP (filed as Exhibit 23.1 to our Annual Report on Form 10-K for the year ended December 31, 2006 (File No. 001-11899) and incorporated by reference). | ||
23.2
|
| Consent of Netherland, Sewell & Associates (filed as Exhibit 23.2 to our Annual Report on Form 10-K for the year ended December 31, 2006 (File No. 001-11899) and incorporated by reference). | ||
23.3
|
| Consent of Miller and Lents (filed as Exhibit 23.3 to our Annual Report on Form 10-K for the year ended December 31, 2006 (File No. 001-11899) and incorporated by reference). | ||
31.1(1)
|
| Certification of William G. Hargett, Chief Executive Officer, as required pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | ||
31.2(1)
|
| Certification of Robert T. Ray, Chief Financial Officer, as required pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | ||
32.1
|
| Certification of William G. Hargett, Chief Executive Officer, as required pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (filed as Exhibit 32.1 to our Annual Report on Form10-K/A (Amendment No. 1) for the year ended December 31, 2006 (File No. 001-11899) and incorporated by reference). | ||
32.2
|
| Certification of Robert T. Ray, Chief Financial Officer, as required pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (filed as Exhibit 32.2 to our Annual Report on Form10-K/A (Amendment No. 1) for the year ended December 31, 2006 (File No. 001-11899) and incorporated by reference). |
(1) Filed herewith. | ||
(2) Management contract or compensation plan. |
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