Southwest Airlines 1996 Annual Report Download - page 42

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Please find page 42 of the 1996 Southwest 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.

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42
Under the 1996 Incentive Stock Option Plan, the Company may grant options to key
Employees for up to 6,000,000 shares of common stock. Under the 1996 Non-Qualified Stock
Option Plan, the Company may grant options to key Employees and non-employee directors for
up to 575,000 shares of common stock. All options granted under these plans have ten-year
terms and vest and become fully exercisable at the end of three, five, or ten years of continued
employment, depending upon the grant type.
Under all fixed option plans, except the SWAPA Plan, the exercise price of each option
equals the market price of the Company’s stock on the date of grant. Under the SWAPA Plan,
for additional options granted each September 1, eligible Pilots will be required to pay a purchase
price equal to 105 percent of the fair value of such stock on the date of the grant.