PNC Bank 2001 Annual Report Download - page 86

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Components Of ESOP Shares
As of or for the year ended December 31
In thousands 2001 2000
Unallocated 364
Allocated 4,134 4,316
Released for allocation 364 348
Retired (490) (530)
Total 4,008 4,498
Compensation expense related to the portion of
contributions matched with ESOP shares is determined
based on the number of ESOP shares allocated.
Compensation expense related to these plans was $28
million, $30 million and $17 million for 2001, 2000 and
1999, respectively.
NOTE 22 STOCK-BASED COMPENSATION PLANS
The Corporation has a long-term incentive award plan
(“Incentive Plan”) that provides for the granting of
incentive stock options, nonqualified stock options, stock
appreciation rights, performance units, restricted stock and
other incentive shares to executives and directors. In any
given year, the number of shares of common stock
available for grant under the Incentive Plan may range
from 1.5% to 3% of total issued shares of common stock
determined at the end of the preceding calendar year. Of
this amount, no more than 20% is available for restricted
stock and other incentive share awards.
As of December 31, 2001 no incentive stock options,
stock appreciation rights or performance unit awards were
outstanding.
NONQUALIFIED STOCK OPTIONS
Options are granted at exercise prices not less than the
market value of common stock on the date of grant.
Generally, options granted in 2001, 2000 and 1999 become
exercisable in installments after the grant date. Options
granted prior to 1999 are mainly exercisable twelve months
after the grant date. Payment of the option price may be in
cash or previously owned shares of common stock at
market value on the exercise date.
A summary of stock option activity follows:
Per O
p
tion
Shares in thousands Exercise Price
Weighted-
Average
Exercise
Price Shares
January 1, 1999 $11.38 - $66.00 $40.30 9,566
Granted 50.47 - 76.00 51.68 3,612
Exercised 11.38 - 54.72 33.89 (1,856)
Terminated 21.75 - 59.31 51.68 (247)
December 31, 1999 11.38 - 76.00 44.83 11,075
Granted 42.19 - 66.22 44.20 4,171
Exercised 11.38 - 59.31 37.77 (2,952)
Terminated 31.13 - 61.75 48.10 (496)
December 31, 2000 21.63 - 76.00 46.25 11,798
Granted 53.74 - 74.70 73.14 3,996
Exercised 21.63 - 59.31 43.46 (2,737)
Terminated 42.19 - 74.59 53.22 (580)
December 31, 2001 21.75 - 76.00 55.15 12,477
Information about stock options outstanding at December 31, 2001 follows:
Options Outstanding Options Exercisable
December 31, 2001
Shares in thousands
Range of exercise prices Shares
Weighted-average
exercise price
Weighted-average remaining
contractual life (in years) Shares
Weighted-average
exercise price
$21.75 - $32.99 829 $28.96 3.2 829 $28.96
33.00 - 49.99 3,478 42.69 7.5 1,211 43.04
50.00 - 76.00 8,170 63.12 7.8 3,239 54.73
Total 12,477 $55.15 7.4 5,279 $48.01
Options granted in 2001 include options for 52,000 shares
granted to non-employee directors.
The weighted-average grant-date fair value of options
granted in 2001, 2000 and 1999 was $15.87, $9.86 and
$10.15 per option, respectively. At December 31, 2000 and
1999 options for 5,834,898 and 7,682,745 shares of
common stock, respectively, were exercisable at a
weighted-average price of $45.96 and $42.05, respectively.
There were no options granted in excess of market
value in 2001or 2000. Options for 82,000 shares of
common stock were granted in 1999 with an exercise price
in excess of the market value on the date of grant. Shares
of common stock available for the granting of options and
other awards under the Incentive Plan and the predecessor
plans were 10,584,683 at December 31, 2001, 2000 and
1999.