(a) Refer to description of 2003 Plan within this note for restrictions on availability. Employee stock options outstanding and exercisable under these plans as of December 27, 2003, were: (millions, except per share data) The Company sponsors a number of U.S. and foreign pension plans to provide retirement benefits for its employees. The majority of these plans are funded or unfunded defined benefit plans, although the Company does participate in a few multiemployer or other de- fined contribution plans for certain employee groups. Defined bene- fits for salaried employees are generally based on salary and years of service, while union employee benefits are generally a negoti- ated amount for each year of service. The Company uses its fiscal year end as the measurement date for the majority of its plans. The accumulated benefit obligation for all defined benefit pension plans was $2.41 billion and $2.05 billion at December 27, 2003 and December 28, 2002, respectively. The projected benefit obliga- tion, accumulated benefit obligation, and fair value of plan assets for pension plans with accumulated benefit obligations in excess of plan assets were: At December 27, 2003, a cumulative after-tax charge of $271.3 million ($397.6 million pretax) has been recorded in other compre- hensive income to recognize the additional minimum pension liabil- ity in excess of unrecognized prior service cost. Refer to Note 5 for further information on the changes in minimum liability included in other comprehensive income for each of the periods presented. Kellogg Company 43 Note 9 Pension benefits Obligations and funded status The aggregate change in projected benefit obligation, change in plan assets, and funded status were: (millions) 2003 2002 2001 Under option, beginning of year 38.2 37.0 23.4 Granted 7.5 9.2 17.1 Exercised (6.0) (5.2) (1.3) Cancelled (2.7) (2.8) (2.2) Under option, end of year 37.0 38.2 37.0 Exercisable, end of year 24.4 20.1 16.9 Average prices per share Under option, beginning of year $33 $3 1 $3 4 Granted 31 33 27 Exercised 28 27 25 Cancelled 35 32 34 Under option, end of year $33 $3 3 $3 1 Exercisable, end of year $34 $3 4 $3 6 Shares available, end of year,  for stock-based awards that may be granted under the following plans: Kellogg Employee Stock Ownership Plan 1.3 .6 2.8 2000 Non-Employee Director Stock Plan .6 .6 .9 2001 Long-Term Incentive Plan — 10.1 16.1 2002 Employee Stock Purchase Plan 2.1 2.4 — Executive Stock Purchase Plan .5 .5 — 2003 Long-Term Incentive Plan (a) 30.5 — — Total 35.0 14.2 19.8 Outstanding Exercisable Weighted Weighted average Weighted Range of average remaining average exercise Number exercise contractual Number exercise prices of options price life (yrs.) of options price $19 – 28 10.2 $ 26 7.0 7.8 $ 27 29 – 34 8.9 31 8.7 2.6 33 35 – 36 10.2 35 7.8 6.6 35 37 – 51 7.7 41 4.2 7.4 42 37.0 24.4 (millions) 2003 2002 Change in projected benefit obligation Projected benefit obligation at beginning of year $ 2,261.4 $ 2,038.7 Acquisition adjustment — (13.4) Service cost 67.5 57.0 Interest cost 151.1 140.7 Plan participants’ contributions 1.7 1.2 Amendments 15.4 28.3 Actuarial loss 195.8 97.8 Benefits paid (134.9) (137.2) Foreign currency adjustments 82.7 46.2 Other .2 2.1 Projected benefit obligation at end of year $ 2,640.9 $ 2,261.4 Change in plan assets Fair value of plan assets at beginning of year $1 ,849.5 $ 1,845.3 Acquisition adjustment — (21.4) Actual return on plan assets 456.9 (191.3) Employer contributions 82.4 309.3 Plan participants’ contributions 1.7 1.2 Benefits paid (132.3) ( 133.7) Foreign currency adjustments 61.0 39.9 Other — .2 Fair value of plan assets at end of year $ 2,319.2 $ 1,849.5 Funded status ($ 321.7) ($ 411.9) Unrecognized net loss 822.3 846.7 Unrecognized transition amount 2.4 2.3 Unrecognized prior service cost 54.4 51.8 Prepaid pension $ 557.4 $ 488.9 Amounts recognized in the Consolidated Balance Sheet consist of Prepaid benefit cost $ 388.1 $ 364.2 Accrued benefit liability (256.3) (376.1) Intangible asset 28.0 27.5 Minimum pension liability 397.6 473.3 Net amount recognized $ 557.4 $ 488.9 (millions) 2003 2002 Projected benefit obligation $1 ,590.4 $ 1,779.4 Accumulated benefit obligation 1,3 94.6 1,569.1 Fair value of plan assets 1,220.0 1,340.6