Alaska Airlines and Horizon Air 2009 Annual Report Download - page 84

GRANT OF OPTION
Grant Date; Number of Shares.On each Grant Date, each Eligible Employee who is a
participant during that Offering Period shall be granted an Option to purchase a number of
shares of Common Stock. The Option shall be exercised on the Exercise Date. The
number of shares of Common Stock subject to the Option shall be determined by dividing
the Participant’s Account balance as of the applicable Exercise Date by the Option Price,
subject to the limits of Section 8(c).
Option Price.The Option Price per share of the shares subject to an Option for an
Offering Period shall be the lesser of: (i) 85% of the Fair Market Value of a Share on the
Grant Date of that Offering Period; or (ii) 85% of the Fair Market Value of a Share on the
Exercise Date of that Offering Period; provided, however, that the Committee may provide
prior to the start of any Offering Period that the Option Price for that Offering Period shall
be determined by applying a discount amount (not to exceed 15%) to either (1) the Fair
Market Value of a share of Common Stock on the Grant Date of that Offering Period, or
(2) the Fair Market Value of a share of Common Stock on the Exercise Date of that
Offering Period, or (3) the lesser of the Fair Market Value of a share of Common Stock on
the Grant Date of that Offering Period or the Fair Market Value of a share of Common
Stock on the Exercise Date of that Offering Period. Notwithstanding anything to the
contrary in the preceding provisions of this Section 8(b), in no event shall the Option Price
per share be less than the par value of a share of Common Stock.
Limits on Share Purchases.Notwithstanding anything else contained herein, the
maximum number of shares subject to an Option for an Offering Period shall be subject to
the Individual Limit in the effect on the Grant Date of that Offering Period (subject to
adjustment pursuant to Section 17) and any person who is otherwise an Eligible
Employee shall not be granted any Option (or any Option granted shall be subject to
compliance with the following limitations) or other right to purchase shares under this
Plan to the extent:
(1) it would, if exercised, cause the person to own stock (within the meaning of
Section 423(b)(3) of the Code) possessing 5% or more of the total combined voting
power or value of all classes of stock of the Company, or of any Parent, or of any
Subsidiary; or
(2) such Option causes such individual to have rights to purchase stock under this Plan
and any other plan of the Company, any Parent, or any Subsidiary which is qualified
under Section 423 of the Code which accrue at a rate which exceeds $25,000 of the
fair market value of the stock of the Company, of any Parent, or of any Subsidiary
(determined at the time the right to purchase such stock is granted, before giving
effect to any discounted purchase price under any such plan) for each calendar year
in which such right is outstanding at any time.
For purposes of the foregoing, a right to purchase stock accrues when it first become
exercisable during the calendar year. In determining whether the stock ownership of an
Eligible Employee equals or exceeds the 5% limit set forth above, the rules of
Section 424(d) of the Code (relating to attribution of stock ownership) shall apply, and
stock which the Eligible Employee may purchase under outstanding options shall be
treated as stock owned by the Eligible Employee.
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