STOCKHOLDERS' EQUITY:
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Jun. 30, 2013
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STOCKHOLDERS' EQUITY: | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
STOCKHOLDERS' EQUITY: | NOTE 11 — STOCKHOLDERS´EQUITY:
Treasury Stock:
Activity in treasury stock in the six-month period ended June 30, 2013 and 2012 is as follows (in millions):
The following table summarizes share distributions in the first six months of 2013 and 2012:
Southern Copper Common Shares:
At June 30, 2013 and 2012, there were in treasury 41,167,836 and 35,751,686 SCC’s common shares, respectively.
SCC share repurchase program:
In 2008, the Company´s Board of Directors authorized a $500 million share repurchase program. On July 28, 2011, the Company´s Board of Directors approved an increase of the SCC share repurchase program from $500 million to $1.0 billion. Pursuant to this program, the Company purchased common stock as shown in the table below. These shares are available for general corporate purposes. The Company may purchase additional shares of its common stock from time to time, based on market conditions and other factors. This repurchase program has no expiration date and may be modified or discontinued at any time.
As a result of this repurchase of shares of SCC’s common stock, Grupo Mexico’s direct and indirect ownership is 81.5% as of June 30, 2013.
Directors’ Stock Award Plan:
The Company established a stock award compensation plan for certain directors who are not compensated as employees of the Company. Under this plan, participants will receive 1,200 shares of common stock upon election and 1,200 additional shares following each annual meeting of stockholders thereafter. 600,000 shares of Southern Copper common stock have been reserved for this plan. The fair value of the award is measured each year at the date of the grant.
The activity of the plan in the six-month period ended June 30, 2013 and 2012 is as follows:
Parent Company common shares:
At June 30, 2013 and 2012 there were in treasury 77,832,273 and 83,709,360 of Grupo Mexico’s common shares, respectively.
Employee Stock Purchase Plan:
In January 2007, the Company offered to eligible employees a stock purchase plan (the “Employee Stock Purchase Plan”) through a trust that acquires shares of Grupo Mexico stock for sale to its employees, employees of subsidiaries, and certain affiliated companies. The purchase price is established at the approximate fair market value on the grant date. Every two years employees will be able to acquire title to 50% of the shares paid in the previous two years. The employees will pay for shares purchased through monthly payroll deductions over the eight year period of the plan. At the end of the eight year period, the Company will grant the participant a bonus of 1 share for every 10 shares purchased by the employee.
If Grupo Mexico pays dividends on shares during the eight year period, the participants will be entitled to receive the dividend in cash for all shares that have been fully purchased and paid as of the date that the dividend is paid. If the participant has only partially paid for shares, the entitled dividends will be used to reduce the remaining liability owed for purchased shares.
In the case of voluntary resignation of the employee, the Company will pay to the employee the fair market sales price at the date of resignation of the fully paid shares, net of costs and taxes. When the fair market sales value of the shares is higher than the purchase price, the Company will apply a deduction over the amount to be paid to the employee based on the following schedule:
In the case of involuntary termination of the employee, the Company will pay to the employee the fair market sales price at the date of termination of employment of the fully paid shares, net of costs and taxes. When the fair market value of the shares is higher than the purchase price, the Company will apply a deduction over the amount to be paid to the employee based on the following schedule:
In case of retirement or death of the employee, the Company will render the buyer or his legal beneficiary, the fair market sales value as of the date of retirement or death of the shares effectively paid, net of costs and taxes.
The stock based compensation expense for the six months ended June 30, 2013 and 2012 and the unrecognized compensation expense as of June 30, 2013 and 2012 under this plan were as follows (in millions):
The unrecognized compensation expense under this plan is expected to be recognized over the remaining one year and six month period.
The following table presents the stock award activity of the Employee Stock Purchase Plan for the six months ended June 30, 2013 and 2012:
During 2010, the Company offered to eligible employees a new stock purchase plan (the “New Employee Stock Purchase Plan”) through a trust that acquires series B shares of Grupo Mexico stock for sale to its employees, employees of subsidiaries, and certain affiliated companies. The purchase price was established at 26.51 Mexican pesos (approximately $2.05) for the initial subscription. The terms of the New Employee Stock Purchase Plan are similar to the terms of the Employee Stock Purchase Plan.
The stock based compensation expense for the six months ended June 30, 2013 and 2012 and the unrecognized compensation expense as of June 30, 2013 and 2012 under this plan were as follows (in millions):
The unrecognized compensation expense under this plan is expected to be recognized over the remaining five year and six month period.
The following table presents the stock award activity of the New Employee Stock Purchase Plan for the six months ended June 30, 2013 and 2012:
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