With a charitable option, companies can donate options with no adverse tax consequences and without reducing the options available to employees under employee option plans. As part of the campaign, Canadian companies seeking an IPO of shares will each be asked to donate between 3,000 and 5,000 charitable options to The Hospital for Sick Children Foundation, to support Canada s foremost paediatric health sciences centre.
Charitable options have unique characteristics.
Under guidelines developed with the Toronto Stock Exchange, a charitable options may only be issued by listed companies to charitable organizations and public foundations within the meaning of the Income Tax Act. They will vest on issue, have an exercise price equal to the concurrent public offering price, have a 10-year term, and may not be transferred or amended. Charitable options may not be issued for more than two per cent of the listed company s outstanding shares. The Hospital for Sick Children Foundation is dedicated to the improvement of children's health. Its mission is to inspire and support the philanthropic spirit in individuals and organizations.