BP 2006 Annual Report Download - page 85

BP Annual Report and Accounts 2006 83
Additional information for shareholders
Share ownership
Directors and senior management
As at 20 February 2007, the following directors of BP p.l.c. held interests
in BP ordinary shares of 25 cents each or their calculated equivalent as
set out below:
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Dr D C Allen 597,568 819,823a
TheLordBrowneofMadingley 2,749,907 3,768,016a
I C Conn 241,797 799,032a
Dr B E Grote 1,181,113 972,212a
Dr A B Hayward 477,092 819,823a
A G Inglis 223,112 –
JAManzoni 442,982 819,823a
J H Bryan 158,760 –
ABurgmans 10,000 –
Sir William Castell ––
EBDavis,Jr 68,992 –
D J Flint 15,000 –
Dr D S Julius 15,000 –
Dr W E Massey 49,722 –
Sir Tom McKillop 20,000 –
Sir Ian Prosser 16,301 –
P D Sutherland 30,079 –
As at 20 February 2007, 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:
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Dr D C Allen 794,950
TheLordBrowneofMadingley 3,261,104
I C Conn 332,390
Dr B E Grote 1,427,190b
Dr A B Hayward 769,620
A G Inglis 415,300
JAManzoni 780,523
aPerformance shares awarded under the BP Executive Directors Incentive Plan.
These represent the maximum possible vesting levels. The actual number of shares/
ADSs that vest will depend on the extent to which performance conditions have
been satisfied over a three-year period.
bIn addition to the above, Dr Grote holds 40,000 Stock Appreciation Rights
(equivalent to 240,000 ordinary shares).
There are no directors or members of senior management who own
more than 1% of the ordinary shares outstanding. At 20 February 2007,
all directors and senior management as a group held interests in
15,488,669 ordinary shares or their calculated equivalent and 8,584,526
options for ordinary shares or their calculated equivalent under the BP
group share options schemes.
Additional details regarding the options granted, including exercise
price and expiry dates, are found in the directors’ remuneration report
on page 75.
Employee share plans
The following table shows employee share options granted.
options thousands
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2006 2005 2004
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Employee share options
granted during the yeara53,978 54,482 80,395
aFor the options outstanding at 31 December 2006, the exercise price ranges and
weighted average remaining contractual lives are shown in Financial statements –
Note 44 on page 163.
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 long-term performance plans (see Financial
statements–Note44onpage163)and the granting of share options as
elements of remuneration for executive directors and senior employees.
Savings and matching plans
BP ShareSave Plan
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 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. Until 2003, a three-year savings plan
was also run in a small number of other countries. Options will remain
outstanding in respect of these countries until the end of June 2007.
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
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 over 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.
Local plans
In some countries, BP provides local scheme benefits, the rules and
qualifications for which vary according to local circumstances.
The above share plans are indicated as being equity-settled. However in
certain countries it is not possible to award shares to employees owing to
local legislation. In these instances the award will be settled in cash,
calculated as the cash equivalent of the value to the employee of an
equity-settled plan.
Cash plans
Cash Options/Stock Appreciation Rights (SARs)
These are cash-settled share-based payments available to certain
employees that require the group to pay the intrinsic value of the
cash option/SAR to the employee at the date of exercise. There are
no performance conditions; however, participants must continue in
employment with BP for the first three calendar years of the plan for
the options/SARs to vest. Special arrangements may apply for qualifying
leavers. The options/SARs are exercisable between the third and 10th
anniversaries of the grant date.
Employee Share Ownership Plans (ESOPs)
ESOPs have been established to acquire BP shares to satisfy any awards
made to participants under the Executive Directors’ Incentive Plan, the
Medium Term Performance Plan, the Long Term Performance Plan, the
Deferred Annual Bonus Plan and the BP ShareMatch Plans. The ESOPs
have waived their rights to dividends on shares held for future awards and
are funded by the group. 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 43 on page 160. Assets and liabilities of the
ESOPs are recognized as assets and liabilities of the group.)
At 31 December 2006, the ESOPs held 12,795,887 shares (2005
14,560,003 shares and 2004 8,621,219 shares) for potential future
awards, which had a market value of $142 million (2005 $156 million and
2004 $84 million).