Westjet 2015 Annual Report Download - page 87

Notes to Consolidated Financial Statements
As at and for the years ended December 31, 2015 and 2014
(Stated in thousands of Canadian dollars, except percentage, ratio, share and per share amounts)
WestJet Annual Report 2015 | 85
11. Share capital (continued)
(c) Stock option plan (continued)
Changes in the number of options, with their weighted average exercise prices, are summarized below:
2015
2014
Number of
options
Weighted
exercise price
Number of
options
Weighted
exercise price
Stock options outstanding, beginning of period
3,738,714
22.33
2,834,639
19.20
Granted
2,477,323
26.63
2,353,474
23.94
Exercised
(371,169)
19.04
(1,447,250)
18.82
Forfeited
(111,736)
23.65
(2,149)
22.90
Expired
(26,585)
20.89
-
-
Stock options outstanding, end of period
5,706,547
24.40
3,738,714
22.33
Exercisable, end of period
2,785,374
22.44
912,772
19.38
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, 2015, option holders exercised 363,734 options (2014 –
1,442,006 options) on a cashless basis and received 107,864 shares (2014 – 495,354 shares). For the year ended December 31,
2015, 7,435 options were exercised on a cash basis (2014 – 5,244 options) and option holders received 7,435 shares (2014 –
5,244 shares).
Options outstanding and exercisable at December 31, 2015:
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
13.85-20.00
314,129
2.14
14.94
314,129
14.94
20.01-23.00
768,638
2.64
21.94
627,569
21.93
23.01-26.00
2,328,440
3.33
23.83
1,833,539
23.87
26.01-31.16
2,295,340
4.08
26.94
10,137
28.63
5,706,547
3.47
24.40
2,785,374
22.44
(d) Key employee plan
The Corporation has a key employee plan (KEP), whereby restricted share units (RSU) are issued to senior management and
pilots of the Corporation. The fair market value of the RSUs at the time of grant is equal to the weighted average trading price
of the Corporation’s voting shares for the five trading days immediately preceding the date of grant. Each RSU entitles the
employee to receive payment upon vesting in the form of voting shares of the Corporation. The Corporation intends to settle all
RSUs with shares either through the purchase of voting shares on the open market or the issuance of new shares from treasury;
however, wholly at its own discretion, the Corporation may settle the units in cash. The RSU’s time vest at the end of a two or
three-year period, with compensation expense being recognized in net earnings over the service period. At December 31, 2015,
944,738 (2014 – 944,738) voting shares of the Corporation were reserved for issuance under the KEP plan. For the year ended
December 31, 2015, the Corporation settled nil RSUs with shares issued from treasury and 216,107 RSUs through the open
market (December 31, 2014 – nil and 217,623, respectively).
Changes in the number of units, with their weighted average fair value, are summarized below:
2015
2014
Number of
units
Weighted fair
value
Number of
units
Weighted fair
value
Units outstanding, beginning of period
391,030
20.99
476,103
17.39
Granted
96,686
26.32
126,759
23.93
Units, in lieu of dividends
6,846
25.00
7,207
27.38
Settled
(216,107)
19.51
(217,623)
15.05
Forfeited
(315)
23.98
(1,416)
19.34
Units outstanding, end of period
278,140
24.09
391,030
20.99