content_image/140246.jpg content_image/140247.jpg
(Expressed in thousands of United States dollars) 

## 12. Capital Management 

The Company’s principal activity of generation, transmission and distribution of electricity in Grand Cayman, requires CUC to have ongoing access to capital to build and maintain the electrical system for the community it serves. 

To help ensure access to capital, the Company targets a long-term capital structure containing approximately 45% equity, including preference shares, and 55% debt, as well as investment-grade credit ratings. 

The Company sets the amount of capital in proportion to risk. The debt to equity ratio is managed through various methods such as the rights offering that occurred in the 2008 Transitional Period and utilisation of the Share Purchase Plans. The capital managed by the Company is composed of debt (short-term debt, long-term debt and bank overdraft) and shareholders’ equity (including: capital stock, share premium, contributed surplus and retained earnings). 

The Company’s capital structure is shown below: 

<img src='content_image/140246.jpg'>

## 13. Capital Stock 

Authorised: 

a) 60,000,000 (December 31, 2010: 60,000,000) Class A Ordinary Shares of CI$0.05 each 

b) 250,000 (December 31, 2010: 250,000) 9% Cumulative, Participating Class B Preference Shares of CI$0.84 each (non-voting) 

c) 419,666 (December 31, 2010: 419,666) Class C Preference Shares of CI$0.84 each (non-voting) 

d) 1 Cumulative, Participating, Class D Preference Share of CI$0.56 (non-voting) 

Class A Ordinary Shares were issued during the period for cash as follows (shares as follows fully stated, not in thousands): 

<img src='content_image/140247.jpg'>

Total shares issued and purchased in 2011 were 159,824. 

Share proceeds totalled $1.5 million, of which $1.49 million was recorded as an increase to share premium and $0.01 million as an increase to share capital. 

