Westjet 2012 Annual Report Download - page 83

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Notes to Consolidated Financial Statements
For the years ended December 31, 2012 and 2011
(Stated in thousands of Canadian dollars, except share and per share amounts)
12. Share capital (continued)
(c) Stock option plan (continued)
Changes in the number of options, with their weighted average exercise prices, are summarized below:
2012
2011
Number of
options
Weighted
average
exercise price
Number of
options
Weighted
average
exercise price
Stock options outstanding, beginning of year
Granted
Exercised
Forfeited
Expired
Stock options outstanding, end of year
Exercisable, end of year
Under the terms of the Corporation's stock option plan, with the approval of the Corporation, option holders can either (i) elect
to receive shares by delivering cash to the Corporation in the amount of the exercise price of the options, or (ii) choose a
cashless settlement alternative, whereby they can elect to receive a number of shares equivalent to the market value of the
options over the exercise price. For the year ended December 31, 2012, option holders exercised options (2011 –
options) on a cashless settlement basis and received shares (2011 – shares). For the year ended
December 31, 2012, 15,232 options were exercised on a cash basis and received 15,232 shares (2011 – 2,689 options and
2,689 shares, respectively).
The following table summarizes the options outstanding and exercisable as at December 31, 2012:
Outstanding options
Exercisable options
Range of exercise
prices
Number
outstanding
Weighted average
remaining life
(years)
Weighted
average exercise
price
Number
exercisable
Weighted
average exercise
price
11.00–12.50
12.51–15.50
15.51–19.99
The fair value of the options is expensed over the service period, with an offsetting entry to equity reserves. The fair value of
each option grant is estimated on the date of grant using the Black-Scholes option pricing model. Upon the exercise of stock
options, consideration received, together with amounts previously recorded in equity reserves, is recorded as an increase to
share capital.
The fair value of options granted during the years ended December 31, 2012 and 2011, and the assumptions used in their
determination are as follows:
2012
2011
Weighted average fair value per option
Weighted average risk-free interest rate
Weighted average expected volatility
Expected life of options (years)
Weighted average dividend yield
WestJet 2012 Annual Report
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