Hess 2000 Annual Report Download - page 39

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The aggregate long-term debt maturing during the next
five years is as follows (in millions): 2001 — $58 (included
in current liabilities); 2002 — $272; 2003 — $28; 2004 — $10
and 2005 — $25.
The Corporation’s long-term debt agreements contain
various restrictions and conditions, including working
capital requirements and limitations on total borrowings
and cash dividends. At December 31, 2000, the Corpora-
tion exceeded the required working capital ratio. Under
the agreements, the Corporation is permitted to borrow
an additional $3.7 billion for the construction or acquisi-
tion of assets. In addition, at December 31, 2000 it
has $1.5 billion of retained earnings free of dividend
restrictions.
At December 31, 2000, the Corporation had an undrawn
$2 billion Global Revolving Credit Facility, which was
due to expire in 2002. In January 2001, this facility was
replaced with two new committed revolving credit facili-
ties (the “Facilities”). The first, provides for $1.5 billion
of short-term revolving credit through January 2002.
The second, is for $1.5 billion of five-year revolving credit
which expires in January 2006. Borrowings under the
Facilities bear interest at .525% and .50%, respectively,
above the London Interbank Offered Rate. Facility fees of
.10% and .125% per annum are payable on the amount
of the credit lines. The Corporation has the option to
extend up to $500 million of debt outstanding under
the short-term revolving credit facility for an additional
364 days.
In 1999, the Corporation issued $1 billion of public deben-
tures, of which $300 million bears interest at 73⁄8% and is
due in 2009 and the remainder bears interest at 77⁄8% and
is due in 2029. The unamortized discount at December 31,
2000 totals $10 million.
In 2000, 1999 and 1998, the Corporation capitalized inter-
est of $3 million, $16 million and $24 million, respec-
tively, on major development projects. The total amount of
interest paid (net of amounts capitalized), principally on
short-term and long-term debt, in 2000, 1999 and 1998 was
$173 million, $145 million and $154 million, respectively.
8. Stock Based Compensation Plans
The Corporation has outstanding stock options and non-
vested common stock under its 1995 Long-Term Incentive
Plan (as amended) and its Executive Long-Term Incentive
Compensation and Stock Ownership Plan (which expired
in 1997). Generally, stock options vest one year from the
date of grant and the exercise price equals or exceeds the
market price on the date of grant. Nonvested common
stock vests three or five years from the date of grant,
depending on the terms of the award.
The Corporation’s stock option activity in 2000, 1999 and
1998 consisted of the following:
Weighted-
average
Options exercise price
(thousands) per share
Outstanding at January 1, 1998 2,248 $ 57.43
Granted 873 53.05
Exercised (3) 49.75
Forfeited (23) 56.22
Outstanding at December 31, 1998 3,095 56.21
Granted 1,804 55.66
Exercised (322) 53.22
Forfeited (70) 58.08
Outstanding at December 31, 1999 4,507 56.18
Granted 870 60.39
Exercised (1,082) 54.41
Outstanding at December 31, 2000 4,295 $57.47
Exercisable at December 31, 1998 2,230 $ 57.44
Exercisable at December 31, 1999 2,702 56.52
Exercisable at December 31, 2000 3,425 56.73
Exercise prices for employee stock options at December
31, 2000 ranged from $49.00 to $65.94 per share. The
weighted-average remaining contractual life of employee
stock options is 7.9 years.