American Airlines 2002 Annual Report Download - page 78

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76
11. Stock Awards and Options (Continued)
In May 1997, in conjunction with the labor agreement reached between American and members of the
Allied Pilots Association (APA), the Company established the Pilots Stock Option Plan (The Pilot Plan). The Pilot
Plan granted members of the APA the option to purchase 11.5 million shares of AMR stock at $41.69 per share,
$5 less than the average fair market value of the stock on the date of grant, May 5, 1997. These shares were
exercisable immediately. In conjunction with the Sabre spin-off, the exercise price was adjusted to $17.59 per
share. Pilot Plan option activity was:
Year Ended December 31,
2002 2001 2000
Outstanding at January 1 9,815,325 10,990,190 5,420,028
Sabre adjustment - - 7,421,048
Exercised (20,606) (1,174,865) (1,850,886)
Outstanding at December 31 9,794,719 9,815,325 10,990,190
The weighted-average grant date fair value per share of all stock option awards granted during 2002,
2001 and 2000 was $11.42, $12.23 and $16.54, respectively.
Shares of deferred stock are awarded at no cost to officers and key employees under the Plans’ Career
Equity Program and will be issued upon the individual's retirement from AMR or, in certain circumstances, will vest
on a pro rata basis. Deferred stock activity was:
Year Ended December 31,
2002 2001 2000
Outstanding at January 1 4,785,712 4,956,497 2,310,680
Sabre adjustment - - 3,165,632
Granted - - -
Issued (1,091,149) (98,566) (479,177)
Canceled (98,055) (72,219) (40,638)
Outstanding at December 31 3,596,508 4,785,712 4,956,497
A performance share plan was implemented in 1993 under the terms of which shares of deferred stock
are awarded at no cost to officers and key employees under the Plans. The fair value of the performance shares
granted is equal to the market price of the Company’s stock at the date of grant. The shares vest over a three-
year performance period based upon certain specified financial measures of the Company. Performance share
activity was:
Year Ended December 31,
2002 2001 2000
Outstanding at January 1 2,486,802 2,507,755 1,215,644
Sabre adjustment - - 1,665,432
Granted 507,350 913,422 1,277,539
Issued (178,596) (194,128) (399,517)
Awards settled in cash (495,897) (706,302) (1,200,177)
Canceled (1,089,555) (33,945) (51,166)
Outstanding at December 31 1,230,104 2,486,802 2,507,755
The weighted-average grant date fair value per share of performance share awards granted during 2002,
2001 and 2000 was $25.98, $28.27 and $32.93, respectively.