Airtran 2007 Annual Report Download - page 66

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60
60
Stock Options
SFAS 123(R) is effective for all stock options granted on or after January 1, 2006. For those stock options that were granted
prior to January 1, 2006, but for which the vesting period is not complete, we used the “modified prospective method” of
accounting permitted under SFAS 123(R). Under this method, stock option awards granted prior to January 1, 2006, but for
which the vesting period is not complete, must be accounted for on a prospective basis with the related cost being recognized
in the financial statements beginning with the first quarter of 2006 using the grant date fair values previously calculated for
our pro forma disclosures. We recognize the related compensation costs not previously reflected in the pro forma disclosures
over the remaining vesting period.
During 2005, we accelerated the vesting for certain unvested stock options awarded that had an exercise price greater than the
market price on the date of the acceleration. The purpose of accelerating the vesting of these options was to avoid
compensation expense in 2006 associated with the unvested options upon adoption of SFAS 123(R).
A summary of stock option activity under the aforementioned plans are as follows:
Options
Weighted-
Average
Exercise
Price
Balance at Januar
y
1, 2007......................................................................................................... 3,295,925 $ 7.20
Granted...................................................................................................................................... — —
Exercised ................................................................................................................................... (197,528) $ 4.77
Expired ...................................................................................................................................... (5,720) $ 8.61
Balance at December 31, 2007.................................................................................................... 3,092,677 $ 6.42
Exercisable at December 31, 2007.............................................................................................. 3,092,677 $ 6.42
The outstanding options have a weighted-average remaining contractual life of 3.6 years and an aggregate intrinsic value of
$5.6 million.