United Airlines 2009 Annual Report Download - page 103

Table of Contents
compensation awards to attract, retain and reward eligible participants. This approval by stockholders also allows for the issuance of up to 8,000,000 additional
shares pursuant to awards granted under the ICP. The ICP replaced the UAL Corporation 2006 Management Equity Incentive Plan (“MEIP”), which was
automatically terminated with respect to future grants and otherwise replaced and superseded by the ICP. Any awards granted under the MEIP remain in effect
pursuant to their terms.
Any officer or employee of UAL or its affiliates is eligible to participate in the ICP. The ICP allows for the grant of options intended to qualify as
incentive stock options (“ISOs”) under Section 422 of the Code, non-qualified stock options (“NSOs”), stock appreciation rights (“SARs”), restricted share
awards, RSUs, performance compensation awards, performance units, cash incentive awards and other equity-based and equity-related awards. Any shares of our
common stock issued under the ICP will consist, in whole or in part, of authorized and unissued shares or of treasury shares.
The ICP provides that, unless otherwise provided in an award agreement, in the event of a change of control of the Company (as defined in the ICP):
• any options and SARs outstanding as of the date the change of control is determined to have occurred become fully exercisable and vested, as of
immediately prior to the change of control;
• all performance units, cash incentive awards and other awards designated as performance compensation awards will be paid out at the “target”
performance level on a prorated basis based on the number of days elapsed from the beginning of the performance period up to and including the
change of control; and
• all other outstanding awards are automatically deemed exercisable or vested and all restrictions and forfeiture provisions related thereto
lapse as of immediately prior to such change of control.
The table below summarizes stock option activity pursuant to the ICP and the MEIP:
Options
Weighted-
Average
Exercise Price
Weighted-
Average
Remaining
Contractual
Life (in years)
Aggregate
Intrinsic Value
(in millions)
Outstanding at beginning of year 4,353,672 $ 32.80
Granted 2,535,300 4.93
Exercised (a) (15,250) 3.43
Canceled (259,334) 15.96
Expired (208,524) 35.91
Outstanding at end of year 6,405,864 22.42 7.38
Vested and expected to vest at end of period 5,868,942 23.28 7.27 $ 18
Exercisable at end of period (b) 2,826,381 34.38 5.97 —
(a) The aggregate intrinsic value of shares exercised in 2009, 2008 and 2007 was less than $1 million, less than $1 million and $11 million, respectively.
(b) Options represent the number of vested options at December 31, 2009. Aggregate intrinsic value is based only on vested options that have an exercise price
less than the UAL stock price at December 31, 2009.
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