Air Canada 2009 Annual Report Download - page 120

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2009 Air Canada Annual Report
120
Range of
Exercise Prices
Expiry
Dates
2009 Outstanding Options 2009 Exercisable Options
Number
of Options
Outstanding
Weighted
Average
Remaining Life
(Years)
Weighted
Average Exercise
Price/Share
Number of
Exercisable
Options
Weighted
Average Exercise
Price/Share
$ 21.00 2013 1,146,400 4 $ 21.00 429,900 $ 21.00
$ 11.08 - $ 18.60 2014 481,074 5 14.73 120,269 14.73
$ 8.51 2015 11,000 6 8.51 1,375 8.51
$ 0.97 - $ 1.59 2016 2,325,000 7 1.32 - -
3,963,474 $ 8.66 551,544 $ 19.60
Range of
Exercise Prices
Expiry
Dates
2008 Outstanding Options 2008 Exercisable Options
Number
of Options
Outstanding
Weighted
Average
Remaining Life
(Years)
Weighted
Average Exercise
Price/Share
Number of
Exercisable
Options
Weighted
Average Exercise
Price/Share
$ 21.00 2013 1,207,577 5 $ 21.00 301,894 $ 21.00
$ 11.08 - $ 18.60 2014 482.870 6 14.74 60,359 14.74
$ 8.51 2015 11,000 7 8.51 - -
1,701,447 $ 19.14 362,253 $ 19.96
Performance Share Units
The Long-term Incentive Plan also includes Performance Share Units (“PSUs”). The vesting term of PSUs is three years, generally
commencing on January 1 of the year following granting, and incorporate performance vesting features based upon achieving
earnings targets established over the vesting period. Subject to vesting and other conditions, each PSU entitles the employee
to receive a payment in the form of one common share, cash in the amount equal to market value of one common share, or
a combination thereof, at the discretion of the Board of Directors. The terms of the plan specify that upon the retirement of
an employee, the number of PSUs that vest are prorated based on the total number of completed months of active service
during the PSU vesting term. Certain PSUs previously granted may only be redeemed for Air Canada shares purchased on the
secondary market and/or equivalent cash. As outlined above, the remaining PSUs may be redeemed for Air Canada shares
issued from treasury or purchased on the secondary market and/or equivalent cash at the discretion of the Corporation.
The compensation expense related to PSUs in 2009 was less than $1. In 2008, previously recorded stock based compensation
expense, related to PSUs, of $2 was reversed as management had determined that the performance vesting criteria would
not be met.
A summary of the Long-term Incentive Plan performance share unit activity is as follows:
2009 2008
Beginning of year 1,671,068 551,251
Granted 11,591 1,125,092
Forfeited (29,595) (5,275)
Outstanding PSUs, end of year (1) 1,653,064 1,671,068
(1) As at December 31, 2009, all PSUs remain non-vested. Included in the total number of PSUs outstanding, 1,091,218 PSUs will entitle the employee to receive, at the
discretion of the Corporation, Air Canada shares purchased on the secondary market and/or equivalent cash (2008 - 1,111,183). As at December 31, 2009, the liability
related to these PSUs is less than $1.
Employee Share Purchase Plans
Eligible employees can participate in the employee share purchase plan under which employees can invest up to 6% of their
base salary for the purchase of shares on the secondary market. Air Canada will match 33.3% of the investments made by
the employee. During 2009, the Corporation recorded compensation expense of less than $1 (2008 - $1).