BP 2009 Annual Report Download - page 99

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BP Annual Report and Accounts 2009
Additional information for shareholders
Additional information for shareholders
As at 18 February 2010, the following directors of BP p.l.c. held options under the BP group share option schemes for ordinary shares or their
calculated equivalent as set out below:
I C Conn 204,970
R W Dudley 270,018
Dr B E Grote 425,598
Dr A B Hayward 549,620
A G Inglis 410,750
There are no directors or members of senior management who own more than 1% of the ordinary shares outstanding. At 18 February 2010, all
directors and senior management as a group held interests in 5,649,017 ordinary shares or their calculated equivalent, 12,173,702 performance
shares or their calculated equivalent and 2,113,316 options for ordinary shares or their calculated equivalent under the BP group share options
schemes.
Additional details regarding the options granted and performance shares awarded can be found in the directors’ remuneration report on
pages 88 and 89.
Employee share plans
The following table shows employee share options granted.
options thousands
2009 2008 2007
Employee share options granted during the yeara9,680 8,063 6,004
aFor the options outstanding at 31 December 2009, the exercise price ranges and weighted average remaining contractual lives are shown in Financial statements – Note 38 on page 172.
BP offers most of its employees the opportunity to acquire a
shareholding in the company through savings-related and/or matching
share plan arrangements. BP also uses performance plans (see Financial
statements – Note 38 on page 172) as elements of remuneration for
executive directors and senior employees.
Shares acquired through the company’s employee share plans
rank pari passu with shares in issue and have no special rights, save as
described below. For legal and practical reasons, the rules of these plans
set out the consequences of a change of control of the company, and
generally provide for options and conditional awards to vest on an
accelerated basis.
Savings and matching plans
BP ShareSave Plan
This is a savings-related share option plan under which employees save
on a monthly basis, over a three- or five-year period, towards the
purchase of shares at a fixed price determined when the option is
granted. This price is usually set at a 20% discount to the market price at
the time of grant. The option must be exercised within six months of
maturity of the savings contract; otherwise it lapses. The plan is run in
the UK and options are granted annually, usually in June. Participants
leaving for a qualifying reason will have six months in which to use their
savings to exercise their options on a pro-rated basis.
BP ShareMatch plans
These are matching share plans under which BP matches employees’
own contributions of shares up to a predetermined limit. The plans are
run in the UK and in more than 70 other countries. The UK plan is run on
a monthly basis with shares being held in trust for five years before they
can be released free of any income tax and national insurance liability.
In other countries the plan is run on an annual basis with shares being
held in trust for three years. The plan is operated on a cash basis in those
countries where there are regulatory restrictions preventing the holding
of BP shares. When the employee leaves BP all shares must be
removed from trust and units under the plan operated on a cash basis
must be encashed.
Once shares have been awarded to an employee under the plan,
the employee may instruct the trustee how to vote their shares.
Local plans
In some countries, BP provides local scheme benefits, the rules and
qualifications for which vary according to local circumstances.
Cash-settled share-based payments
Grants are settled in cash where participants are located in a country
whose regulatory environment prohibits the holding of BP shares.
Employee share ownership plans (ESOPs)
ESOPs have been established to hold BP shares to satisfy any releases
made to participants under the Executive Directors’ Incentive Plan, the
Long-Term Performance Plan and the Share Option plans. The ESOPs
have waived their rights to dividends on shares held for future awards
and are funded by the group. Pending vesting, the ESOPs have
independent trustees that have the discretion in relation to the voting of
such shares. Until such time as the company’s own shares held by the
ESOP trusts vest unconditionally in employees, the amount paid for
those shares is deducted in arriving at shareholders’ equity (see Financial
statements – Note 37 on page 168). Assets and liabilities of the ESOPs
are recognized as assets and liabilities of the group.
At 31 December 2009, the ESOPs held 18,062,246 shares (2008
29,051,082 shares and 2007 6,448,838 shares) for potential future
awards, which had a market value of $174 million (2008 $220 million and
2007 $79 million).
Pursuant to the various BP group share option schemes, the
following options for ordinary shares of the company were outstanding at
18 February 2010:
Expiry dates Exercise price
Options outstanding (shares) of options per share
285,364,691 2010-2016 $6.18-$11.92
More details on share options appear in Financial statements – Note 38
on page 172.