Alaska Airlines and Horizon Air 2007 Annual Report Download - page 91

• subject to such procedures as the Administrator may adopt, pursuant to a “cashless
exercise” with a third party who provides financing for the purposes of (or who otherwise
facilitates) the purchase or exercise of awards.
In no event shall any shares newly-issued by the Corporation be issued for less than the
minimum lawful consideration for such shares or for consideration other than consideration
permitted by applicable state law. Shares of Common Stock used to satisfy the exercise price
of an option shall be valued at their fair market value on the date of exercise. The Corporation
will not be obligated to deliver any shares unless and until it receives full payment of the
exercise or purchase price therefor and any related withholding obligations under Section 8.5
and any other conditions to exercise or purchase have been satisfied. Unless otherwise
expressly provided in the applicable award agreement, the Administrator may at any time
eliminate or limit a participant’s ability to pay the purchase or exercise price of any award or
shares by any method other than cash payment to the Corporation.
5.6 Definition of Fair Market Value. For purposes of this Plan, “fair market value” shall mean,
unless otherwise determined or provided by the Administrator in the circumstances, the
closing price (in regular trading) for a share of Common Stock on the New York Stock Exchange
(the “Exchange”) for the date in question or, if no sales of Common Stock were reported on
the Exchange on that date, the closing price (in regular trading) for a share of Common Stock
on the Exchange for the next preceding day on which sales of Common Stock were reported on
the Exchange. The Administrator may, however, provide with respect to one or more awards
that the fair market value shall equal the closing price (in regular trading) for a share of
Common Stock on the Exchange on the last trading day preceding the date in question or the
average of the high and low trading prices of a share of Common Stock on the Exchange for
the date in question or the most recent trading day. If the Common Stock is no longer listed or
is no longer actively traded on the Exchange as of the applicable date, the fair market value of
the Common Stock shall be the value as reasonably determined by the Administrator for
purposes of the award in the circumstances. The Administrator also may adopt a different
methodology for determining fair market value with respect to one or more awards if a different
methodology is necessary or advisable to secure any intended favorable tax, legal or other
treatment for the particular award(s) (for example, and without limitation, the Administrator
may provide that fair market value for purposes of one or more awards will be based on an
average of closing prices (or the average of high and low daily trading prices) for a specified
period preceding the relevant date).
5.7 Transfer Restrictions.
5.7.1 Limitations on Exercise and Transfer. Unless otherwise expressly provided in (or
pursuant to) this Section 5.7 or required by applicable law: (a) all awards are non-transferable
and shall not be subject in any manner to sale, transfer, anticipation, alienation, assignment,
pledge, encumbrance or charge; (b) awards shall be exercised only by the participant; and
(c) amounts payable or shares issuable pursuant to any award shall be delivered only to (or for
the account of) the participant.
5.7.2 Exceptions. The Administrator may permit awards to be exercised by and paid to, or
otherwise transferred to, other persons or entities pursuant to such conditions and
procedures, including limitations on subsequent transfers, as the Administrator may, in its
sole discretion, establish in writing. Any permitted transfer shall be subject to compliance with
applicable federal and state securities laws and shall not be for value (other than nominal
consideration, settlement of marital property rights, or for interests in an entity in which more
than 50% of the voting interests are held by the Eligible Person or by the Eligible Person’s
family members).
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