Cogeco 2005 Annual Report Download - page 47

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9CAPITAL STOCK (continued)
During the year, subordinate voting shares transactions were as follows:
2005 2004
Number of Number of
(amounts are in thousands of dollars, except number of shares) shares Amount shares Amount
$$
Balance at beginning 24,232,815 531,070 24,190,043 530,669
Shares issued for cash under the Employee Stock
Purchase Plan and the Stock Option Plan 60,671 742 42,772 401
Compensation expense previously recorded
in contributed surplus for options exercised —62——
Balance at end 24,293,486 531,874 24,232,815 531,070
During 2005, the Corporation issued 5,209 shares (9,768 shares in 2004) pursuant to its Employee Stock Purchase Plan for a cash consideration
of $111,000 ($137,000 in 2004). Also, the Corporation issued 55,462 shares (33,004 shares in 2004) pursuant to its Employee Stock Option Plan
for a cash consideration of $631,000 ($264,000 in 2004).
Stock-based plans
The Corporation established, for the benefit of its employees and those of its subsidiaries, an Employee Stock Purchase Plan and a Stock
Option Plan for certain executives. Under these plans, no more than 10% of the outstanding subordinate voting shares are available.
Stock Purchase Plan
The Employee Stock Purchase Plan is accessible to all employees up to a maximum of 5% of their annual salary. The subscription date
is December 31 and the subscription price is based on the average market price of the shares of the last five business days of November
less 10%. A maximum of 167,500 shares are available, up to 40,000 annually, under this plan.
Stock Option Plan
A total of 1,832,500 subordinate voting shares are reserved for the purpose of the Stock Option Plan. The minimum purchase price at which
options are granted is not less than the market value of such shares at the time the option is granted. Granted options vest 20% per year beginning
the day such options are granted and are exercisable over 10 years. During fiscal year 2005, the Corporation granted 140,766 stock options
(164,980 in 2004) with an exercise price of $21.50 ($15.70 to $18.12 in 2004) of which 38,397 stock options (48,037 in 2004) were granted
to COGECO Inc.’ employees. For the exercise of options granted on or after October 17, 2003, an amount equivalent to 20% of net gain after
related taxes must be kept in shares of the Corporation until termination of employment with the Corporation or retirement.
Cogeco Cable Inc. 2005
45
Notes to Consolidated Financial Statements