Sunoco 2004 Annual Report Download - page 71

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ence stock for $100. After a party has acquired 15 percent
or more of the common stock, each Right will entitle a
holder to pay $100 for the number of shares of Company
common stock (or in certain situations, common stock of
the acquiring party) having a then current market value
of $200. Alternatively, the Company has the option to
exchange one share of Company common stock for each
Right at any time after a party has acquired at least 15
percent but less than 50 percent of the common stock.
The Company may redeem each Right for $.01 per Right
at any time until a party has acquired 15 percent or more
of the common stock. In general, none of the benefits of
the Rights will be available to a holder of 15 percent or
more of the common stock. The Rights will expire on
February 12, 2006, unless earlier exchanged or redeemed.
The following table sets forth the components (net of re-
lated income taxes) of the accumulated other compre-
hensive loss balances in shareholders’ equity:
December 31
(Millions of Dollars) 2004 2003
Minimum pension liability adjustment $(166) $(190)
Hedging activities 23
$(164) $(187)
15. Management Incentive Plans
Sunoco’s principal management incentive plans are the
Executive Incentive Plan (“EIP”) and the Long-Term Per-
formance Enhancement Plan II (“LTPEP II”). The EIP
provides for the payment of annual cash incentive awards
while the LTPEP II provides for the award of stock op-
tions, common stock units and related rights to directors,
officers and other key employees of Sunoco. The options
granted under LTPEP II have a 10-year term, are not ex-
ercisable until two years after the date of grant and permit
optionees to purchase Company common stock at its fair
market value on the date of grant. LTPEP II authorizes the
use of four million shares of common stock for awards. No
awards may be granted under LTPEP II after December 31,
2008, unless the Board extends this date to a date no later
than December 31, 2013.
The following table summarizes information with respect
to common stock option awards under Sunoco’s
management incentive plans as well as the Employee
Option Plan:
Management Incentive Plans Employee Option Plan*
Shares
Under
Option
Weighted-
Average
Option Price
Per Share
Shares
Under
Option
Option
Price
Per Share
Outstanding, December 31, 2001 4,497,694 $ 31.02 378,899 $ 28.00
Granted 733,360 $ 30.27 —
Exercised (604,264) $ 27.34 (213,470) $ 28.00
Canceled (95,480) $ 35.60 (6,225) $ 28.00
Outstanding, December 31, 2002 4,531,310 $ 31.29 159,204 $ 28.00
Granted 504,800 $ 48.80 —
Exercised (1,803,310) $ 30.31 (93,695) $ 28.00
Canceled (32,760) $ 37.95 (41,619) $ 28.00
Outstanding, December 31, 2003 3,200,040 $ 34.53 23,890 $ 28.00
Granted 410,600 $82.56 —
Exercised (2,227,096) $32.01 (23,890) $28.00
Canceled ——
Outstanding, December 31, 2004 1,383,544 $52.84 —
Exercisable, December 31
2002 3,111,490 $ 30.13 159,204 $ 28.00
2003 1,964,380 $ 32.46 23,890 $ 28.00
2004 468,144 $31.11 —
Available for Grant, December 31
2002 2,526,780 —
2003 2,385,580 —
2004 1,940,760 —
*Options were granted to employees (other than executives) during 1993 and 1994.
69