SkyWest Airlines 2010 Annual Report Download - page 104

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SKYWEST, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
DECEMBER 31, 2010
(10) Retirement Plans and Employee Stock Purchase Plans (Continued)
The 1995 Stock Purchase Plan was a compensatory plan under the accounting guidance because the
shares were purchased semi-annually at a 15% discount based on the lower of the beginning or the end
of the period price. During the year ended December 31, 2008, the Company recorded compensation
expense of $3.0 million related to 1995 Stock Purchase Plan. The fair value of the shares purchased
under the Stock Purchase Plan was determined using the Black-Scholes option pricing model with the
following assumptions:
2008
Expected annual dividend rate ................................... 0.80%
Risk-free interest rate ......................................... 2.51%
Average expected life (months) .................................. 6
Expected volatility of common stock .............................. 0.264
(11) Stock Repurchase
The Company’s Board of Directors has authorized the repurchase of up to 20,000,000 shares of
the Company’s common stock in the public market. During the years ended December 31, 2010 and
2009, the Company repurchased 2.1 and 1.9 million shares of common stock for approximately
$30.0 million and $18.4 million, respectively at a weighted average price per share of $14.61 and $9.88,
respectively.
(12) Related-Party Transactions
The Company’s President, Chairman of the Board and Chief Executive Officer, serves on the
Board of Directors of Zions Bancorporation (‘‘Zions’’). The Company maintains a line of credit (see
Note 3) and certain bank accounts with Zions. Zions is an equity participant in leveraged leases on
three CRJ200, two CRJ700 and five Brasilia turboprop aircraft operated by the Company. Zions also
serves as the Company’s transfer agent. The Company’s cash balance in the accounts held at Zions as
of December 31, 2010 and 2009 was $30.4 million and $22.1 million, respectively.
100