PCG » Topics » This table summarizes the distribution and the terms and conditions of stock options granted to the officers named in the Summary Compensation Table during the past year.
This excerpt taken from the PCG DEF 14A filed Mar 14, 2006.
This table summarizes the distribution and the terms and conditions of stock options granted to the officers named in the Summary
Compensation Table during the past year.
% of Total
Peter A. Darbee
Christopher P. Johns
Bruce R. Worthington
Gordon R. Smith
Thomas B. King
Robert D. Glynn, Jr.
options granted to officers in 2005 are exercisable as follows: 25 percent of the options may be exercised on or after the first anniversary of the date of grant,
50 percent on or after the second anniversary, 75 percent on or after the third anniversary, and 100 percent on or after the fourth anniversary, provided that options will vest
immediately upon the occurrence of certain events. No options were accompanied by tandem dividend equivalents.
stock appreciation rights (SARs) have been granted since 1991.
exercise price is equal to the closing price of PG&E Corporation common stock on the date of grant.
options granted to officers in 2005 expire 10 years and 1 day from the date of grant, subject to earlier expiration in the event of the officer's termination of
employment with PG&E Corporation, Pacific Gas and Electric Company, or one of their subsidiaries.
present values are based on the Black-Scholes Model, a mathematical formula used to value options traded on stock exchanges. The Black-Scholes Model considers a number of
factors, including the expected volatility and dividend rate of the stock, interest rates, and time of exercise of the option. The following assumptions were used in applying the Black-Scholes Model
to the 2005 option grants shown in the table above: (i) volatility of 33.3 percent, (ii) risk-free rate of return of 4.10 percent, (iii) dividend yield
of $1.20, and (iv) an exercise date 10 years after the date of grant. The ultimate value of the options will depend on the future market price of PG&E Corporation common stock, which
cannot be forecast with reasonable accuracy. That value will depend on the future success achieved by employees for the benefit of all shareholders. The estimated grant date present value for the
options shown in the table was $7.67 per share.
Aggregated Option/SAR Exercises in 2005 and Year-End Option/SAR Values
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