United Airlines 2007 Annual Report Download - page 108

Download and view the complete annual report

Please find page 108 of the 2007 United Airlines annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 190

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128
  • 129
  • 130
  • 131
  • 132
  • 133
  • 134
  • 135
  • 136
  • 137
  • 138
  • 139
  • 140
  • 141
  • 142
  • 143
  • 144
  • 145
  • 146
  • 147
  • 148
  • 149
  • 150
  • 151
  • 152
  • 153
  • 154
  • 155
  • 156
  • 157
  • 158
  • 159
  • 160
  • 161
  • 162
  • 163
  • 164
  • 165
  • 166
  • 167
  • 168
  • 169
  • 170
  • 171
  • 172
  • 173
  • 174
  • 175
  • 176
  • 177
  • 178
  • 179
  • 180
  • 181
  • 182
  • 183
  • 184
  • 185
  • 186
  • 187
  • 188
  • 189
  • 190

UAL Corporation and Subsidiary Companies
Combined Notes to Consolidated Financial Statements (Continued)
(5) Share-Based Compensation Plans (Continued)
Compensation," for information regarding the Company's adoption of SFAS 123R effective January 1, 2006 and pro forma compensation expense for 2005.
Predecessor Company—As of January 31, 2006, a total of 9 million stock options were outstanding. The Company did not issue any stock-based awards
during 2005. Under the Company's Plan of Reorganization, these stock options were canceled on the Effective Date. No material share-based compensation
expense was incurred as a result of these outstanding options for the month of January 2006.
Successor Company—As part of the Plan of Reorganization and as described in more detail below, the Bankruptcy Court approved UAL's share-based
compensation plans known as the MEIP and the DEIP which became effective on February 1, 2006. The following table summarizes the number of awards
authorized, issued and available for future grants under each plan as of December 31, 2007:
MEIP
DEIP
Total
Authorized 9,825,000 175,000 10,000,000
Granted (10,354,250) (101,229) (10,455,479)
Canceled awards available for reissuance 1,183,716 — 1,183,716
Available for future grants 654,466 73,771 728,237
The following table provides information related to our share-based compensation plans.
(In millions)
Year Ended
December 31,
2007
Period from
February 1 to
December 31,
2006
Compensation cost:
MEIP restricted stock $ 25 $ 84
MEIP stock options 24 72
DEIP unrestricted stock — 3
Total compensation cost $ 49 $ 159
The unrecognized compensation cost related to unvested awards at December 31, 2007 was $41 million which is expected to be recognized over a
weighted-average period of 2.2 years. During the second quarter of 2006, the Company revised its initial estimated award forfeiture rate of 7.5% to 15% based
upon actual attrition. As a result, the share-based compensation expense was reduced by approximately $7 million for the eleven month period ended
December 31, 2006.
Management Equity Incentive Plan ("MEIP"). The Human Resources Subcommittee of the UAL Board of Directors (the "HR Subcommittee") is
authorized under the plan to grant equity-based and other performance-based awards ("Award(s)") to executive officers and other key management employees of
the Company and its subsidiaries.
All executive officers and other key management employees of the Company and its subsidiaries are eligible to become participants in the MEIP. The HR
Subcommittee will select from time to time, from among all eligible individuals, the persons who will be granted an Award. The MEIP authorizes
99
Source: UNITED AIR LINES INC, 10-K, February 29, 2008