Alaska Airlines and Horizon Air 2007 Annual Report Download - page 97

8.8 Governing Law; Construction; Severability.
8.8.1 Choice of Law. This Plan, the awards, all documents evidencing awards and all other
related documents shall be governed by, and construed in accordance with the laws of the
State of Delaware.
8.8.2 Severability. If a court of competent jurisdiction holds any provision invalid and
unenforceable, the remaining provisions of this Plan shall continue in effect.
8.8.3 Plan Construction.
(a) Rule 16b-3. It is the intent of the Corporation that the awards and transactions permitted
by awards be interpreted in a manner that, in the case of participants who are or may be
subject to Section 16 of the Exchange Act, qualify, to the maximum extent compatible with
the express terms of the award, for exemption from matching liability under Rule 16b-3
promulgated under the Exchange Act. Notwithstanding the foregoing, the Corporation shall
have no liability to any participant for Section 16 consequences of awards or events under
awards if an award or event does not so qualify.
(b) Section 162(m). Awards under Section 5.1.4 to persons described in Section 5.2 that are
either granted or become vested, exercisable or payable based on attainment of one or
more performance goals related to the Business Criteria, as well as Qualifying Options
and Qualifying SARs granted to persons described in Section 5.2, that are approved by a
committee composed solely of two or more outside directors (as this requirement is
applied under Section 162(m) of the Code) shall be deemed to be intended as
performance-based compensation within the meaning of Section 162(m) of the Code
unless such committee provides otherwise at the time of grant of the award. It is the
further intent of the Corporation that (to the extent the Corporation or one of its
Subsidiaries or awards under this Plan may be or become subject to limitations on
deductibility under Section 162(m) of the Code) any such awards and any other
Performance-Based Awards under Section 5.2 that are granted to or held by a person
subject to Section 162(m) will qualify as performance-based compensation or otherwise
be exempt from deductibility limitations under Section 162(m).
8.9 Captions. Captions and headings are given to the sections and subsections of this Plan
solely as a convenience to facilitate reference. Such headings shall not be deemed in any
way material or relevant to the construction or interpretation of this Plan or any provision
thereof.
8.10 Stock-Based Awards in Substitution for Stock Options or Awards Granted by Other
Corporation. Awards may be granted to Eligible Persons in substitution for or in connection
with an assumption of employee stock options, SARs, restricted stock or other stock-based
awards granted by other entities to persons who are or who will become Eligible Persons in
respect of the Corporation or one of its Subsidiaries, in connection with a distribution,
merger or other reorganization by or with the granting entity or an affiliated entity, or the
acquisition by the Corporation or one of its Subsidiaries, directly or indirectly, of all or a
substantial part of the stock or assets of the employing entity. The awards so granted need
not comply with other specific terms of this Plan, provided the awards reflect only
adjustments giving effect to the assumption or substitution consistent with the conversion
applicable to the Common Stock in the transaction and any change in the issuer of the
security. Any shares that are delivered and any awards that are granted by, or become
obligations of, the Corporation, as a result of the assumption by the Corporation of, or in
substitution for, outstanding awards previously granted by an acquired company (or
previously granted by a predecessor employer (or direct or indirect parent thereof) in the
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