Wells Fargo 2005 Annual Report Download - page 88

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86
EMPLOYEE STOCK OWNERSHIP PLAN Under the Wells Fargo &
Company 401(k) Plan (the 401(k) Plan), a defined contribution
ESOP, the 401(k) Plan may borrow money to purchase our
common or preferred stock. Since 1994, we have loaned
money to the 401(k) Plan to purchase shares of our ESOP
Preferred Stock. As we release and convert ESOP Preferred
Stock into common shares, we record compensation expense
equal to the current market price of the common shares.
Dividends on the common shares allocated as a result of the
release and conversion of the ESOP Preferred Stock reduce
retained earnings and the shares are considered outstanding
This table is a summary of our stock option plans described on the preceding page.
(in millions, except shares) Shares outstanding Dividends paid
__________December 31, Year ended December 31,
2005 2004 2003 2005 2004 2003
Allocated shares (common) 36,917,501 33,921,758 31,927,982 $71 $61 $46
Unreleased shares (preferred) 325,463 269,563 214,100 39 32 26
Fair value of unearned ESOP shares $325 $270 $214
Deferred Compensation Plan for Independent Sales Agents
WF Deferred Compensation Holdings, Inc. is a wholly
owned subsidiary of the Parent formed solely to sponsor
a deferred compensation plan for independent sales agents
who provide investment, financial and other qualifying
services for or with respect to participating affiliates.
The balance of ESOP shares, the dividends on allocated shares of common stock and unreleased preferred shares paid to the
401(k) Plan and the fair value of unearned ESOP shares were:
The plan, which became effective January 1, 2002, allows
participants to defer all or part of their eligible compensation
payable to them by a participating affiliate. The Parent
has fully and unconditionally guaranteed the deferred
compensation obligations of WF Deferred Compensation
Holdings, Inc. under the plan.
December 31, 2005
Options outstanding Options exercisable
Range of exercise prices Number Weighted-average Weighted-average Number Weighted-average
exercise price remaining contractual exercise price
life (in yrs.)
Director Plans
$13.49-$16.00 2,530 $13.49 1.01 2,530 $13.49
$16.01-$25.04 17,010 24.09 .49 17,010 24.09
$25.05-$38.29 34,620 33.09 1.88 34,620 33.09
$38.30-$51.00 197,942 46.51 5.60 197,942 46.51
$51.01-$69.01 137,412 59.38 7.69 137,412 59.38
Long-Term Incentive Plans
$3.37-$5.06 29,012 $ 4.23 6.50 29,012 $ 4.23
$5.07-$7.60 4,366 5.84 20.02 4,366 5.84
$11.42-$17.13 101,430 16.53 .60 101,430 16.53
$17.14-$25.71 57,574 23.33 3.53 57,574 23.33
$25.72-$38.58 16,442,280 34.24 2.98 16,277,280 34.22
$38.59-$71.30 93,956,450 52.41 5.99 86,583,658 52.80
Broad-Based Plans
$16.56 287,403 $16.56 .56 287,403 $16.56
$24.85-$37.81 5,107,673 35.35 2.42 5,107,673 35.35
$37.82-$46.50 8,661,248 46.44 4.86 8,540,348 46.50
$46.51-$51.15 10,436,437 50.50 6.22 509,362 50.50
for computing earnings per share. Dividends on the unallocated
ESOP Preferred Stock do not reduce retained earnings, and
the shares are not considered to be common stock equivalents
for computing earnings per share. Loan principal and interest
payments are made from our contributions to the 401(k)
Plan, along with dividends paid on the ESOP Preferred
Stock. With each principal and interest payment, a portion
of the ESOP Preferred Stock is released and, after conversion
of the ESOP Preferred Stock into common shares, allocated
to the 401(k) Plan participants.