Stock Options
Key employees are granted stock options under Schlumberger stock option plans. For all of the stock options
granted, the exercise price equals the average of the high and low sales prices of Schlumberger stock on the date of
grant; an option’s maximum term is ten years, and options generally vest in increments over four or five years.
The fair value of each stock option grant was estimated on the date of grant using the Black-Scholes option-pricing
model with the following weighted-average assumptions and resulting weighted-average fair value per share:
2012 2011 2010
Dividend yield
1.5%
1.2% 1.3%
Expected volatility
39%
37% 35%
Risk free interest rate
1.5%
2.8% 2.9%
Expected option life in years
6.9
6.9 6.9
Weighted-average fair value per share
$25.26
$31.38 $24.13
The following table summarizes information concerning options outstanding and options exercisable by five ranges
of exercise prices as of December 31, 2012:
(Shares stated in thousands)
Options Outstanding
Options Exercisable
Exercise prices range
Options
Outstanding
Weighted-
average
remaining
contractual life
(in years)
Weighted-
average
exercise
price
Options
Exercisable
Weighted-
average
exercise price
$20.65 - $32.46
631
1.31
$28.19
631
$28.19
$32.62 - $37.85
4,988
5.68
$37.45
2,670
$37.11
$39.08 - $55.69
4,779
4.09
$52.55
4,003
$53.24
$56.61 - $74.57
18,519
7.49
$68.22
5,645
$63.42
$83.89 - $110.78
13,142
7.02
$86.10
5,913
$87.58
42,059
6.65
$67.77
18,862
$63.93
The weighted average remaining contractual life of stock options exercisable as of December 31, 2012 was 5.1 years.
The following table summarizes stock option activity during the years ended December 31, 2012, 2011 and 2010:
(Shares stated in thousands)
2012
2011
2010
Shares
Weighted-
average
exercise
price Shares
Weighted-
average
exercise
price Shares
Weighted-
average
exercise
price
Outstanding at beginning of year
40,027 $63.84
37,499 $55.33 35,500
$50.30
Granted
8,664 $72.04
9,528 $84.29
8,283
$66.67
Assumed in Smith transaction
– $ –
– $ –
581
$28.77
Exercised
(4,171) $39.07
(5,470) $42.36 (5,962)
$37.60
Forfeited
(2,461) $67.50
(1,530) $58.82
(903)
$61.28
Outstanding at year-end
42,059 $67.77
40,027 $63.84 37,499
$55.33
The aggregate intrinsic value of stock options outstanding as of December 31, 2012 was approximately $308 million.
The aggregate intrinsic value of stock options exercisable as of December 31, 2012 was approximately $209 million.
The total intrinsic value of options exercised during the years ended December 31, 2012, 2011 and 2010, was $142
million, $246 million and $188 million, respectively.
Restricted Stock
Restricted stock awards generally vest at the end of three years. As of December 31, 2012, there have not been any
grants to date that are subject to performance-based vesting.
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