NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Options Options are exercisable, subject to the terms and conditions of the plan, in increments of 33.33% per year on each  of the first three anniversaries of the date of grant. The plan provides that the exercise price of an option will be  determined by the compensation committee of the Board of Trust Managers on the day of grant, and to date all options  have been granted at an exercise price that equals the fair market value on the date of grant. Options exercised during  2004 were exercised at prices ranging from $21.38 to $44.00 per share. At December 31, 2004, options outstanding  were at exercise prices ranging from $24.88 to $44.00 per share and had a weighted average remaining contractual  life of 7.7 years.  The following is a detail of outstanding options at December 31, 2004: TOTAL OPTIONS  VESTED OPTIONS WEIGHTED WEIGHTED  REMAINING OPTION PRICE  OUTSTANDING  AVERAGE PRICE  OUTSTANDING  AVERAGE PRICE  CONTRACTUAL LIFE $24.88-$34.59 585,400 $ 32.21 154,744 $ 31.68 7.3 years $36.87-$41.91 396,936 37.91 259,814 38.45 6.8 years $42.90-$44.00 573,494 43.22 171,494 43.97 8.6 years Total options  1,555,830  $  37.72  586,052  $ 38.28  7.7 years In 1998, in connection with the merger with Oasis Residential, Inc., we assumed the Oasis stock incentive plans. We  converted all unexercised Oasis stock options issued under the former Oasis stock incentive plans into options to  purchase Camden common shares. All of the Oasis options became fully vested upon conversion and have a weighted  average remaining contractual life of 1.9 years. As of December 31, 2004, there were 5,695 Oasis options outstanding,  which are exercisable at prices ranging from $29.48 to $30.80 per share. Share awards have vesting periods of up to ten years. The compensation cost for share awards is based on the market  value of the shares on the date of grant. Share awards granted to non-employee trust managers have been awarded  for their services as trust managers, and therefore, are accounted for on the same basis as all share awards.  We have established an ESPP for all active employees, officers, and trust managers who have completed one year of  continuous service. Participants may elect to purchase Camden common shares through payroll or trust manager fee  deductions and/or through quarterly contributions. At the end of each six-month offering period, each participant’s  account balance is applied to acquire common shares on the open market at 85% of the market value, as defined, on  the first or last day of the offering period, whichever price is lower. Each participant must hold the shares purchased  for nine months in order to receive the discount, and a participant may not purchase more than $25,000 in value of  shares during any plan year, as defined. In connection with our adoption of SFAS No. 148, we recognize compensation  expense for the difference in price paid by employees and the fair market value of our shares at the date of purchase.  We expensed $0.2 million related to ESPP purchases during 2004. There were 20,126, 26,668 and 24,382 shares  purchased under the ESPP during 2004, 2003 and 2002, respectively. The weighted average fair value of ESPP shares  purchased in 2004, 2003 and 2002 was $47.88, $34.49 and $35.12 per share, respectively. In January 2005, 8,068  shares were purchased under the ESPP related to the 2004 plan year. We have established a rabbi trust in which share awards granted to participants under the share incentive plan and  salary and other cash amounts earned may be deposited. The rabbi trust is an irrevocable trust and no portion of the  trust fund may be used for any purpose other than the delivery of those assets to the participants. The assets held in  the rabbi trust are subject to the claims of the Company’s general creditors in the event of bankruptcy or insolvency. We follow the provisions of EITF 97-14, “Accounting for Deferred Compensation Arrangements Where the Amounts  Are Held in a Rabbi Trust and Invested”, regarding the accounting for the rabbi trust. As such, as required by EITF  97-14, the assets of the rabbi trust are consolidated into our financial statements. Granted share awards held by the  86 camden transforming Rabbi Trust Employee Stock Purchase Plan Share awards