Notes to Consolidated Financial Statements Special vesting provisions may apply if: • there is a change of control of BCE Inc. and the option holder’s employment ends under certain circumstances • the option holder is employed by a designated sub- sidiary of BCE Inc., and BCE Inc.’s ownership interest in that subsidiary falls below the percentage set out in the program. We ensured that exercising the Nortel options would not dilute Nortel shares by: • calculating how many BCE Inc. common shares could be issued under options granted under stock option programs immediately before the day of the distribution • factoring this number into the calculation that deter- mined how many Nortel common shares were distrib- uted for each BCE Inc. common share held. When the Nortel common shares were distributed in May 2000, each outstanding BCE Inc. stock option was cancelled and replaced by two new stock options. The first option gives the holder the right to buy one BCE Inc. common share. The second option gives the holder the right to buy approximately 1.57 post-split common shares of Nortel (Nortel option) at exercise prices that maintain the holder’s economic position. BCE Inc. may exercise all Nortel options that expire unexercised or are forfeited. The exercise price paid to Nortel is given back to BCE Inc. We credit an amount to retained earnings that is equal to the market share price of Nortel. The table below is a summary of the status of BCE Inc.’s stock option programs. 2004 2003 2002 WEIGHTED WEIGHTED WEIGHTED AVERAGE AVERAGE AVERAGE NUMBER EXERCISE NUMBER EXERCISE NUMBER EXERCISE OF SHARES PRICE ($) OF SHARES PRICE ($) OF SHARES PRICE ($) Outstanding, January 1 25,750,720 $32 24,737,423 $34 28,732,342 $36 Granted 5,911,576 $30 6,008,051 $28 8,051,159 $32 Exercised (1,946,864) $16 (552,681) $17 (479,873) $14 Expired/forfeited (1,233,753) $34 (4,442,073) $35 (11,566,205) $39 Outstanding, December 31 28,481,679 $32 25,750,720 $32 24,737,423 $34 Exercisable, December 31 14,633,433 $34 10,722,294 $33 10,735,043 $35 The table below shows you more about BCE Inc.’s stock option programs at December 31, 2004. OPTIONS OUTSTANDING OPTIONS EXERCISABLE WEIGHTED WEIGHTED WEIGHTED AVERAGE AVERAGE AVERAGE RANGE OF REMAINING EXERCISE EXERCISE EXERCISE PRICES NUMBER LIFE PRICE ($) NUMBER PRICE ($) Below $20 1,609,697 3 years $14 1,609,697 $14 $20–$30 12,377,141 7 years $29 2,052,600 $28 $30–$40 8,123,342 7 years $34 5,419,524 $34 Over $40 6,371,499 6 years $41 5,551,612 $41 28,481,679 $32 14,633,433 $34 110 Bell Canada Enterprises  2004 Annual Report