General Electric Co imposed new conditions on a large options award the board granted to Chief Executive Jeff Immelt after shareholders expressed concerns that the terms needed to be more stringent.

The largest U.S. conglomerate said the vesting of 2 million stock options -- which it said were worth $7.4 million and came in a year that Immelt also received his first cash bonus since before the financial crisis -- will be tied to cash flow and stock performance targets.

Some shareholders have expressed the view that additional performance conditions should be applied to Mr. Immelt's 2010 stock option award, the Fairfield, Connecticut-based company said in a filing with the U.S. Securities and Exchange Commission.

Earlier this month, ISS Proxy Advisory Services had charged there is a misalignment between long-term company performance and CEO pay at GE, citing the options grant as the main cause of that misalignment.

The company said half the options awarded to Immelt would vest only if its generates at least $55 billion in cash flow across its industrial businesses -- a term GE uses to refer to everything outside its GE Capital finance arm -- over the four years ended December 31, 2014. That $55 billion target would exclude unusual events.

The other half will vest only if GE's total shareholder return meets or exceeds the widely watched Standard & Poor's 500 index <.SPX> over that time period.

GE shares have lagged the S&P 500 over the past year, gaining 5.3 percent while the index has risen 9.5 percent.

In early Tuesday trading they were unchanged at $19.98 on the New York Stock Exchange, and remain less than half their price before Immelt took the reins in September 2001.

GE last year paid Immelt a $4 million cash bonus, his first since 2007, pushing his total compensation to $21.4 million as well as the special grant of 2 million options.

The past year has been a momentous time for GE. It closed on its sale of a 51 percent stake in NBC Universal media to Comcast Corp and returned to the takeover trail with a vengeance, reaching $14 billion in deals primarily to boost its presence in the energy industry as Immelt seeks to refocus the company on its industrial roots after almost a decade as CEO.

The company also raised its dividend by a total of 37 percent in two moves, boosting the quarterly payout to 14 cents per share. Immelt has repeatedly said that the company aims to pay out about 45 percent of its annual profit to shareholders and that it plans to continue to raise the dividend to match earnings growth.

The world's largest maker of jet engines and electric turbines is due to report its first-quarter results to Wall Street on Thursday.

(Reporting by Scott Malone, editing by Dave Zimmerman)