Cincinnati Bell 2005 Annual Report Download - page 23

•a stock option for a number of common shares (as determined by the Board) on the date of each annual
meeting, if such director first became a non-employee director of the Company before the date of such
annual meeting and continues in office as a non-employee director after such meeting.
In 2005, on the first day of his initial term of office as a non-employee director of the Company, Mr. Shumate
received a stock option grant for 25,000 common shares. On the date of the 2005 annual meeting, each
non-employee director in office prior to such annual meeting received a stock option grant for 9,000 common
shares.
The Board will exercise its discretion in granting such options on and after January 1, 2006 with the intent
that such grants, together with other Company equity-based compensation, provide Company equity-based
compensation for the Company’s non-employee directors that each year is competitive with the value of equity-
based compensation provided by comparable companies to their non-employee directors.
In addition, a non-employee director of the Company may elect, prior to the start of any calendar year, to
waive all or a portion (in 25% increments) of his or her retainer and other director fees from the Company for
such calendar year and in return receive an additional stock option under the Directors Stock Option Plan as of
the first business day of such calendar year. The number of common shares to be subject to such elected option
will be determined by the Board in its discretion (and generally, in the absence of another method chosen by the
Board, will be determined by dividing the anticipated retainer and other fees for the calendar year for which the
director is waiving the fees by the per share value of the stock option as determined under a reasonable valuation
method adopted by the Board).
A non-employee director of the Company who served as a non-employee director prior to 2006 may also
have had additional stock options granted to him or her before 2006 under the Directors Stock Option Plan.
Each stock option granted to a non-employee director under the Directors Stock Option Plan requires that,
upon the exercise of the option, the price to be paid for the common shares that are being purchased under the
option will be equal to 100% of the fair market value of such shares as determined at the time the option is
granted.
With certain exceptions provided in the Directors Stock Option Plan, a non-employee director of the
Company who is granted an option under the plan generally will have ten years from the date of the grant of the
option to elect to exercise the option.
Other Compensation for Non-Employee Directors
The Company also provides its non-employee directors who live in the Cincinnati area with certain
telecommunications services. The average annual cost of such services was approximately $2,027 per
non-employee director in 2005 who received such services.
Executive Sessions of Non-Management Directors
The non-management directors of the Company meet in executive session without management present at
each regularly scheduled meeting of the Board of Directors. Mr. Cox presides at the meeting of the
non-management directors.
COMPENSATION INTERLOCKS AND INSIDER PARTICIPATION
None to report.
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