Kodak 2000 Annual Report Download - page 57

Assumed healthcare cost trend rates have a significant eff e c t
on the amounts re p o rted for the healthcare plans. A one per-
centage point change in assumed healthcare cost trend rates
would have the following eff e c t s :
1 % 1 %
i n c re a s e d e c re a s e
E ffect on total service and interest
cost components $ 6 $ ( 4 )
E ffect on postre t i rement benefit
o b l i g a t i o n 8 3 ( 5 2 )
Note 14: Stock Option And Compensation Plans
The Company’s stock incentive plans consist of the 2000
Omnibus Long-Te rm Compensation Plan (the 2000 Plan), the
1995 Omnibus Long-Te rm Compensation Plan (the 1995 Plan),
and the 1990 Omnibus Long-Te rm Compensation Plan (the 1990
Plan). The Plans are administered by the Executive Compensation
and Development Committee of the Board of Dire c t o r s .
Under the 2000 Plan, 22 million shares of the Company’s
common stock may be granted to a variety of employees between
J a n u a ry 1, 2000 and December 31, 2004. The 2000 Plan is sub-
stantially similar to, and is intended to replace, the 1995 Plan
which expired on December 31, 1999.
Under the 1995 Plan, 22 million shares of the Company’s
common stock were eligible for grant to a variety of employees
between Febru a ry 1, 1995 and December 31, 1999. Option
prices are not less than 100% of the per- s h a re fair market value
on the date of grant, and the options generally expire ten years
f rom the date of grant, but may expire sooner if the optionee’s
employment terminates. The 1995 Plan also provides for Stock
A p p reciation Rights (SARs) to be granted, either in tandem with
options or freestanding. SARs allow optionees to receive pay-
ment equal to the diff e rence between the Company’s stock mar-
ket price on grant date and exercise date. At December 31, 2000,
229,215 freestanding SARs were outstanding at option prices
ranging from $56.31 to $71.81.
Under the 1990 Plan, 22 million shares of the Company’s
common stock were eligible for grant to key employees between
F e b ru a ry 1, 1990 and January 31, 1995. Option prices could not
be less than 50% of the per- s h a re fair market value on the date
of grant; however, no options below fair market value were
granted. The options generally expire ten years from the date of
grant, but may expire s ooner if the optionee’s employment term i-
nates. The 1990 Plan also provided that options with dividend
equivalents, tandem SARs and freestanding S ARs could be
granted. At December 31, 2000, 106,754 freestanding SARs
w e re outstanding at option prices ranging from $32.50 to $44.50.
In April 1998, the Company made a grant of 100 stock
options for common stock to most employees of the Company at
that date (8,468,100 shares under options). The options were
granted at fair market value on the date of grant and expire ten
years from the grant date. The options have a two-year vesting
period. The Executive Compensation and Development Commit-
tee of the Board of Directors approved the grant. A second grant
of 100 stock options for common stock was made on March 13,
2000 to most employees of the Company at that date (7,004,400
s h a res under options). The options were granted at fair market
value on the date of grant and expire ten years from the grant
date. The options have a two-year vesting period.
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