Southwest Airlines 2003 Annual Report Download - page 63

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and vest and become fully exercisable over three, five, or ten years of continued employment, depending
upon the grant type. All of these other Employee plans have been approved by shareholders except the plan
covering non-management, non-contract Employees, which had 7.6 million options outstanding to purchase
the Company’s common stock as of December 31, 2003, and an additional plan which is not available to
Officers or Board members, reserving 15 million shares for future grants.
Aggregated information regarding the Company’s fixed stock option plans, as adjusted for stock splits, is
summarized below:
COLLECTIVE BARGAINING PLANS OTHER EMPLOYEE PLANS
(In thousands, except exercise prices) Options
Average exercise
price Options
Average exercise
price
Outstanding December 31, 2000 63,400 $ 5.59 36,358 $ 8.66
Granted 1,665 19.05 4,022 18.75
Exercised (4,166) 4.48 (4,135) 4.77
Surrendered (349) 8.71 (1,394) 10.87
Outstanding December 31, 2001 60,550 6.05 34,851 10.20
Granted 48,414 13.37 4,423 16.90
Exercised (4,211) 4.48 (3,805) 5.75
Surrendered (733) 8.69 (1,317) 12.48
Outstanding December 31, 2002 104,020 9.51 34,152 11.47
Granted 26,674 13.53 4,770 14.63
Exercised (7,422) 6.78 (3,318) 7.95
Surrendered (3,214) 12.69 (1,052) 13.57
Outstanding December 31, 2003 120,058 $ 10.47 34,552 $ 12.21
Exercisable December 31, 2003 60,430 $ 7.46 16,031 $ 12.37
Available for grant in future periods 20,919 28,981
The following table summarizes information about stock options outstanding under the fixed option plans at
December 31, 2003:
OPTIONS EXERCISABLE
Range of exercise
prices
Options
outstanding at
12/31/03
(000s)
Wtd-average
remaining
contractual life
Wtd-average
exercise price
Options
exercisable at
12/31/03
(000s)
Wtd-average
exercise price
$ 3.33 to $ 4.9 43,779 2.9 yrs $ 4.05 40,295 $ 4.01
$ 5.11 to $ 7.4 2,411 2.5 yrs 5.77 2,411 5.77
$ 7.86 to $11.7 12,762 4.9 yrs 9.86 6,978 9.97
$12.11 to $18.0 87,167 7.8 yrs 13.76 22,328 14.12
$18.26 to $23.9 8,491 6.3 yrs 19.61 4,449 19.84
$ 3.33 to $23.9 154,610 6.0 yrs $ 10.86 76,461 $ 8.49
OPTIONS OUTSTANDING
Under the amended 1991 Employee Stock Purchase Plan (ESPP), which has been approved by stockholders,
as of December 31, 2003, the Company is authorized to issue up to a remaining balance of 5.0 million shares
of common stock to Employees of the Company. These shares may be issued at a price equal to 90 percent
of the market value at the end of each purchase period. Common stock purchases are paid for through
periodic payroll deductions. Participants under the plan received 1.4 million shares in 2003, 1.4 million
shares in 2002, and 1.0 million shares in 2001, at average prices of $14.04, $14.70, and $16.42, respectively.
The weighted-average fair value of each purchase right under the ESPP granted in 2003, 2002, and 2001,