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Table of Contents
Awards
Weighted
Average
Remaining
Contractual
Term
Aggregate
Intrinsic Value
Outstanding at January 1
6,341,695
Granted
—
Settled
—
Forfeited or Expired
(197,695)
Outstanding at December 31
6,144,000
0.2
$4,915,200
The aggregate intrinsic value represents the Company’s current estimate of the number of shares ( 6,144,000 shares at December 31, 2012) that will ultimately
be distributed for outstanding awards computed using the market value AMR's common stock at December 31, 2012. The weighted-average grant date fair
value per share of performance share awards granted during 2011 and 2010 was $6.58 and $7.01, respectively. As of December 31, 2012, there was $2
million of total unrecognized compensation cost related to performance share awards that is expected to be recognized during 2013.
Deferred Share Awards The distribution of deferred share awards granted under the LTIP Plans is based solely on a requisite service period (generally 36
months). Career equity awards granted to certain employees of the Company vest upon the retirement of those individuals. The fair value of each deferred
award is based on AMR’s stock price on the measurement date.
Activity during 2012 for deferred awards accounted for as equity awards was:
Shares
Weighted
Average
Remaining
Contractual
Term
Aggregate
Intrinsic Value
Outstanding at January 1
7,271,021
Granted
—
Settled
(24,840)
Forfeited or Expired
(481,124)
Outstanding at December 31
6,765,057
0.9
$5,412,045
The weighted-average grant date fair value per share of deferred awards granted during 2011 and 2010 was $6.29 and $7.05, respectively. The total fair value
of awards settled during the years ended December 31, 2011 and 2010 was $1 million and $3 million, respectively. As of December 31, 2012, there was $6
million of total unrecognized compensation cost related to deferred awards that is expected to be recognized over a weighted average period of 2.3 years.
Other Awards As of December 31, 2012, certain performance share agreements and deferred share award agreements were accounted for as a liability, or as
equity, as appropriate, in the consolidated balance sheet as the plans only permit settlement in cash or the awards required that the employee meet certain
performance conditions which were not subject to market measurement. As a result, awards under these agreements are marked to current market value. As of
December 31, 2012, the aggregate intrinsic value of these awards was $2 million and the weighted average remaining contractual term of these awards was 1.3
years. The total fair value of awards settled during the years ended December 31, 2012, 2011 and 2010 was $0 million, $2 million, and $2 million
respectively. As of December 31, 2012, there was $1 million of total unrecognized compensation cost related to other awards that is expected to be recognized
over a weighted average period of 1.3 years.
The Company does not intend to assume any equity-based awards that were outstanding at the commencement date of its Chapter 11 Case.
11. Retirement Benefits
The Company sponsors defined benefit and defined contribution pension plans for eligible employees. The defined benefit plans provide benefits for
participating employees based on years of service and average compensation for a specified period of time before retirement. The Company uses a December 31
measurement date for all of its defined benefit plans.
Modifications to Retirement and Life Insurance Benefits
On March 7, 2012, the Company announced that, in working with Creditors' Committee and the Pension Benefit Guarantee
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