GE 2008 Annual Report Download - page 87

ge 2008 annual report 85
notes to consolidated financial statements
All grants of GE options under all plans must be approved by
the Management Development and Compensation Committee,
which consists entirely of independent directors.
STOCK COMPENSATION PLANS
Securities
Securities Weighted available
to be issued average for future
December 31, 2008 (Shares in thousands) upon exercise exercise price issuance
APPROVED BY SHAREOWNERS
Options 214,824 $36.30 (a)
RSUs 36,392 (b) (a)
PSUs 1,050 (b) (a)
NOT APPROVED BY SHAREOWNERS
(CONSULTANTS’ PLAN)
Options 683 35.85 (c)
RSUs 91 (b) (c)
Total 253,040 $36.30 462,787
(a) In 2007, the Board of Directors approved the 2007 Long-Term Incentive Plan (the
Plan). The Plan replaced the 1990 Long-Term Incentive Plan. The maximum number
of shares that may be granted under the Plan is 500 million shares, of which no
more than 250 million may be available for awards granted in any form provided
under the Plan other than options or stock appreciation rights. The approximate
105.9 million shares available for grant under the 1990 Plan were retired upon
approval of the 2007 Plan. Total shares available for future issuance under the 2007
Plan amounted to 439.0 million shares at December 31, 2008.
(b) Not applicable.
(c) Total shares available for future issuance under the consultants’ plan amount to
23.8 million shares.
Outstanding options expire on various dates through
December 11, 2018.
The following table summarizes information about stock
options outstanding at December 31, 2008.
STOCK OPTIONS OUTSTANDING
(Shares in thousands) Outstanding Exercisable
Average Average
exercise exercise
Exercise price range Shares Average life (a) price Shares price
Under $27.00 784 4.6 $22.50 568 $23.94
27.01–32.00 66,510 6.1 28.36 40,767 28.39
32.01–37.00 61,593 4.6 34.73 47,045 34.91
37.01–42.00 32,555 4.7 39.19 19,843 39.47
42.01–47.00 42,045 2.0 43.29 42,045 43.29
Over $47.00 12,020 1.7 56.86 12,020 56.86
Total 215,507 4.4 $36.30 162,288 $37.59
At year-end 2007, options with an average exercise price of $36.98 were exercisable
on 168 million shares.
(a) Average contractual life remaining in years.
SHARES OF GE PREFERRED STOCK
On October 16, 2008, GE issued 30,000 shares of GE’s 10%
cumulative perpetual preferred stock, par value $1.00 per share,
having an aggregate liquidation value of $3.0 billion, and warrants
to purchase 134,831,460 shares of GE’s common stock, par value
$0.06 per share, for an aggregate purchase price of $3.0 billion
in cash. The preferred stock is redeemable at GE’s option after
three years, in whole or in part, at a price of 110% of liquidation
value plus accrued and unpaid dividends. The warrants are exer-
cisable at the holder’s option at any time and from time to time,
in whole or in part, for five years at an exercise price of $22.25
per share of common stock and are settled through physical
share issuance. GE has 50 million authorized shares of preferred
stock ($1.00 par value), and has issued 30 thousand shares as of
December 31, 2008.
SHARES OF GE COMMON STOCK
On September 25, 2008, we suspended our three-year, $15 billion
share repurchase program, which was initiated in December 2007.
Under this program, on a book basis, we repurchased 99.1 million
shares for a total of $3.1 billion during 2008.
On October 7, 2008, GE completed an offering of 547.8 million
shares of common stock at a price of $22.25 per share.
Common shares issued and outstanding are summarized in
the following table.
December 31 (In thousands) 2008 2007 2006
Issued 11,693,829 11,145,252 11,145,212
In treasury (1,156,932) (1,157,653) (867,839)
Outstanding 10,536,897 9,987,599 10,277,373
Note 24.
Other Stock-Related Information
We grant stock options, restricted stock units (RSUs) and perfor-
mance share units (PSUs) to employees under the 2007 Long-Term
Incentive Plan. This plan replaced the 1990 Long-Term Incentive
Plan. In addition, we grant options and RSUs in limited circum-
stances to consultants, advisors and independent contractors
(primarily non-employee talent at NBC Universal) under a plan
approved by our Board of Directors in 1997 (the consultants’
plan). There are outstanding grants under one shareowner-
approved option plan for non-employee directors. Share require-
ments for all plans may be met from either unissued or treasury
shares. Stock options expire 10 years from the date they are
granted and vest over service periods that range from one to five
years. RSUs give the recipients the right to receive shares of our
stock upon the vesting of their related restrictions. Restrictions on
RSUs vest in various increments and at various dates, beginning
after one year from date of grant through grantee retirement.
Although the plan permits us to issue RSUs settleable in cash,
we have only issued RSUs settleable in shares of our stock. PSUs
give recipients the right to receive shares of our stock upon the
achievement of certain performance targets.