BP Annual Report and Form 20-F 2011 - Company Reporting

Additional information for shareholdersEmployee share plansThe following table shows employee share options granted.Options thousands2011 a 2010 2009Employee share options grantedduring the year b 152,473 10,420 9,680a142,550,350 options were granted pursuant to the BP Plan 2011, adopted on 7 September 2011.For more information on the BP Plan 2011, see Financial statements – Note 40 on page 246.b For the options outstanding at 31 December 2011, the exercise price ranges and weighted averageremaining contractual lives are shown in Financial statements – Note 40 on page 246.BP offers most of its employees the opportunity to acquire a shareholdingin the company through savings-related and/or matching share planarrangements. BP also uses performance plans and option plans (seeFinancial statements – Note 40 on page 246) as elements of remunerationfor executive directors and senior employees.Shares acquired through the company’s employee share plansrank pari passu with shares in issue and have no special rights, saveas described below. For legal and practical reasons, the rules of theseplans set out the consequences of a change of control of the company,and generally provide for options and conditional awards to vest on anaccelerated basis.Matching and saving plansBP ShareMatch plansThese matching share plans give employees the opportunity to buyordinary shares in BP p.l.c. and receive free matching shares in BP p.l.c.,up to a predetermined limit. The plans are run in the UK and in more than50 other countries. The UK plan is an approved HMRC plan and runs ona monthly basis. Under the UK plan, shares must be held in trust for atleast three years to receive beneficial tax treatment. In other countries,the plan is run on an annual basis with shares being held in trust for threeyears. The plan is operated on a cash basis in those countries where thereare regulatory restrictions preventing the holding of BP shares. When theemployee leaves BP all shares must be removed from trust and unitsunder 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.BP ShareSave PlanThis is an approved HMRC plan which is open to all eligible UK employees.Participants can contribute up to a maximum of £250 per month fromtheir net salary to a savings account over a three- or five-year contractualsavings period. At the end of the savings period, they are entitled topurchase shares in BP p.l.c. at a preset price determined on the date whenthe invitations are sent to eligible employees. This price is usually set at adiscount to the market price of a share of up to 20%. The option must beexercised within six months of maturity of the savings contract, otherwiseit lapses. The plan is run in the UK and options are granted annually, usuallyin June. Participants leaving for a qualifying reason before the savingscontract matured will have up to six months in which to use their savingsto exercise their options on a pro-rated basis.Local plansIn some countries, BP provides local scheme benefits, the rules andqualifications for which vary according to local circumstances. Certain USemployees may participate in a defined contribution (401k) plan in whichBP matches employee contributions up to certain limits. Participants mayinvest in several investment options including a BP Stock Fund that holdsBP ADSs and a small percentage of cash. At 31 December 2011 the BPStock Fund held 39,026,928 BP ADSs with a market value of $1,682 million(2010: 38,382,657 BP ADSs and $1,715 million). Participants in the fund asof the record date may direct the trustee how to vote their portion of theBP Stock Fund.Cash-settled share-based paymentsGrants are settled in cash where participants are located in a countrywhose regulatory environment prohibits the holding of BP shares.Employee Share Ownership Plan Trusts (ESOPs)ESOPs have been established to hold BP shares to satisfy any releasesmade to participants under the Executive Directors’ Incentive Plan, theLong-Term Performance Plan and the Share Option Plan. The ESOPshave waived their rights to dividends on shares held for future awards andare funded by the group. Pending vesting, the ESOPs have independenttrustees that have the discretion in relation to the voting of such shares.Until such time as the company’s own shares held by the ESOPs vestunconditionally in employees, the amount paid for those shares isdeducted in arriving at shareholders’ equity (see Financial statements –Note 39 on page 242). Assets and liabilities of the ESOPs are recognizedas assets and liabilities of the group.At 31 December 2011, the ESOPs held 27,784,503 shares(2010 11,477,253 shares and 2009 18,062,246 shares) for potentialfuture awards, which had a market value of $197 million (2010 $82 millionand 2009 $174 million).Pursuant to the various BP group share option schemes, thefollowing options for ordinary shares of the company were outstanding at17 February 2012:Expiry datesExercise priceOptions outstanding (shares)of optionsper share334,424,461 2012-2021 $5.66-11.92More details on share options appear in Financial statements – Note 40 onpage 246.Major shareholdersThe disclosure of certain major and significant shareholdings in theshare capital of the company is governed by the Companies Act 2006, theUK Financial Services Authority’s Disclosure and Transparency Rules (DTR)and the US Securities Exchange Act of 1934.Register of members holding BP ordinary shares as at31 December 2011Number of ordinaryshareholdersPercentage of totalordinary shareholdersPercentage of totalordinary share capitalexcluding sharesheld in treasuryRange of holdings1-200 59,824 19.65 0.02201-1,000 112,279 36.87 0.311,001-10,000 119,628 39.28 1.8810,001-100,000 11,107 3.65 1.17100,001-1,000,000 923 0.30 1.81Over 1,000,000 a 755 0.25 94.81Totals 304,516 100.00 100.00aIncludes JPMorgan Chase Bank, N.A. holding 26.50% of the total ordinary issued share capital(excluding shares held in treasury) as the approved depositary for ADSs, a breakdown of which isshown in the table below.Register of holders of American depositary shares (ADSs) as at31 December 2011 aNumber ofADS holdersPercentage of totalADS holdersPercentage of totalADSsRange of holdings1-200 62,206 56.35 0.42201-1,000 30,364 27.50 1.731,001-10,000 16,856 15.27 5.3410,001-100,000 966 0.87 1.96100,001-1,000,000 9 0.01 0.15Over 1,000,000 b 1 0.00 90.40Totals 110,402 100.00 100.00aOne ADS represents six 25 cent ordinary shares.bOne holder of ADSs represents 792,991 underlying shareholders.As at 31 December 2011, there were also 1,591 preference shareholders.Preference shareholders represented 0.44% and ordinary shareholdersrepresented 99.56% of the total issued nominal share capital of thecompany (excluding shares held in treasury) as at that date.158 BP Annual Report and Form 20-F 2011