SkyWest Airlines 2008 Annual Report Download - page 83

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SKYWEST, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
DECEMBER 31, 2008
(7) Capital Transactions (Continued)
The following table summarizes information about stock options outstanding at December 31,
2008:
Options Outstanding Options Exercisable
Weighted Average
Number Remaining Weighted Average Number Weighted Average
Range of Exercise Prices Outstanding Contractual Life Exercise Price Exercisable Exercise Price
$10 to $15 ............. 336,757 3.2 years $11.21 335,454 $11.20
$16 to $21 ............. 2,212,537 5.1 years 18.09 2,207,561 18.08
$22 to $28 ............. 1,921,440 3.9 years 25.83 1,007,268 26.10
$10 to $28 ............. 4,470,734 4.4 years 20.90 3,550,283 19.71
Taxes
A portion of the Company’s granted options qualify as incentive stock options (ISO) for income
tax purposes. As such, a tax benefit is not recorded at the time the compensation cost related to the
options is recorded for book purposes due to the fact that an ISO does not ordinarily result in a tax
benefit unless there is a disqualifying disposition. Stock option grants of non-qualified options result in
the creation of a deferred tax asset, which is a temporary difference, until the time that the option is
exercised. Due to the treatment of incentive stock options for tax purposes, the Company’s effective tax
rate from year to year is subject to variability.
(8) Retirement Plan and Employee Stock Purchase Plan
SkyWest Retirement Plan
The Company sponsors the SkyWest, Inc. Employees’ Retirement Plan (the ‘‘SkyWest Plan’’).
Employees who have completed 90 days of service and are at least 18 years of age are eligible for
participation in the SkyWest Plan. Employees may elect to make contributions to the SkyWest Plan.
The Company matches 100% of such contributions up to 2%, 4% or 6% of the individual participant’s
compensation, based upon length of service. Additionally, a discretionary contribution may be made by
the Company. The Company’s combined contributions to the SkyWest Plan were $9.3 million,
$9.0 million and $7.2 million for the years ended December 31, 2008, 2007 and 2006, respectively.
ASA Retirement Plan
ASA sponsors the Atlantic Southeast Airlines, Inc. Investment Savings Plan (the ‘‘ASA Plan’’).
Employees who have completed 90 days of service and are 18 years of age are eligible for participation
in the ASA Plan. Employees may elect to make contributions to the ASA Plan however, ASA limits the
amount of company match at 6% of each participant’s total compensation, except for those with 10 or
more years of service whose company match is limited to 8% of total compensation. Additionally, ASA
matches the individual participant’s contributions from 20% to 75%, depending on the length of the
participant’s service. ASA’s contribution to the ASA Plan was $4.6 million, $4.0 million and $4.1million
for the years ended December 31, 2008, 2007 and 2006, respectively. Additionally, participants are
100% vested in their elective deferrals and rollover amounts and from 10% to 100% vested in company
matching contributions based on length of service.
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