US Airways 2005 Annual Report Download - page 160

Table of Contents
US Airways Group, Inc.
Notes to Consolidated Financial Statements — (Continued)
granted under the 2005 Incentive Plan are intended to qualify as "incentive stock options" within the meaning of Section 422 of the Internal Revenue Code of
1986, as amended. Nonstatutory stock options granted under the 2005 Incentive Plan are not intended to qualify as incentive stock options under the Internal
Revenue Code.
A maximum of 12.5% of the fully-diluted shares (as of the completion of the merger) of US Airways Group common stock is available for issuance under
the 2005 Incentive Plan, totaling 10,969,191 shares. Any or all of these shares may be granted pursuant to incentive stock options. Shares of US Airways
Group common stock issued under the 2005 Incentive Plan may be unissued shares or reacquired shares, purchased on the open market or otherwise.
The number of shares of US Airways Group common stock available for issuance under the 2005 Incentive Plan will be reduced by (i) one share for each
share of stock issued pursuant to a stock option or a stock appreciation right, and (ii) three shares for each share of stock issued pursuant to a stock purchase
award, stock bonus award, stock unit award, and other full-value types of stock awards. Stock awards that are terminated, forfeited or repurchased will result
in an increase in the share reserve of the 2005 Incentive Plan corresponding to the reduction originally made in respect of the award.
If a stock award granted under the 2005 Incentive Plan or the 2002 Incentive Plan expires or otherwise terminates without being exercised in full, or if any
shares of US Airways Group common stock issued pursuant to a stock award under the 2005 Incentive Plan are forfeited to or repurchased by US Airways
Group, including, but not limited to, any repurchase or forfeiture caused by the failure to meet a contingency or condition required for the vesting of such
shares, then the shares of US Airways Group common stock not issued under that stock award, or forfeited to or repurchased by US Airways Group, will
revert to and again become available for issuance under the 2005 Incentive Plan. If any shares subject to a stock award are not delivered to a participant
because those shares are withheld for the payment of taxes or the stock award is exercised through a reduction of shares subject to the stock award (i.e., "net
exercised"), the number of shares that are not delivered will remain available for issuance under the 2005 Incentive Plan. If the exercise price of any stock
award is satisfied by tendering shares of US Airways Group common stock held by the participant, then the number of shares so tendered (whether by actual
tender or by attestation of ownership) will remain available for issuance under the 2005 Incentive Plan. Shares of US Airways Group common stock subject to
stock awards issued in substitution for previously outstanding awards assumed in connection with a merger, consolidation or similar transaction will not
reduce the number of shares available for issuance under the 2005 Incentive Plan.
Stock options are granted with an exercise price equal to the stock's fair market value at the date of grant, generally become exercisable over a three-year
period and expire if unexercised at the end of 10 years. At December 31, 2005, approximately 6.9 million shares are available for grant under the 2005
Incentive Plan. 154