SHAREHOLDER'S EQUITY

12 Months Ended

Dec. 31, 2021

Equity [Abstract]

SHAREHOLDER'S EQUITY

SHAREHOLDERS' EQUITY

Dividends

In March 2020, the Company suspended the payment of dividends indefinitely. The Company is barred by its CARES Act agreements from resuming any payment of dividends until October 1, 2022. Prior to the suspension, the Company paid dividends of $45 million and $173 million to shareholders of record during 2020 and 2019.

Common Stock Repurchase

In August 2015, the Board of Directors authorized a $1 billion share repurchase program. As of December 31, 2021, the Company has repurchased 7.6 million shares for $544 million under this program. In March 2020, the Company suspended the share repurchase program indefinitely. The Company is barred by its CARES Act agreements from resuming share repurchases until October 1, 2022. Prior to the suspension, the Company repurchased $31 million, or 538,078 shares, in 2020 and $75 million, or 1,192,820 shares, in 2019.

At December 31, 2021, the Company held 9,349,944 shares in treasury. Management does not anticipate retiring common shares held in treasury for the foreseeable future.

CARES Act Warrant Issuance

As additional taxpayer protection required under the PSP programs, during 2021, the Company granted the Treasury a total of 539,508 warrants to purchase common stock. The warrants are non-voting, freely transferable, may be settled as net shares or in cash at the Company's option, and have a five-year term.

In addition, in conjunction with the October 2020 draw on the CARES Act Loan, the Company granted the Treasury 427,080 warrants to purchase Alaska Air Group (ALK) common stock. The value of the warrants was estimated using the Black-Scholes option pricing model, and the relative fair value of the warrants of $6 million was recorded in stockholders' equity.

Total warrants outstanding are as follows as of December 31, 2021:

	Number of shares of ALK common stock	Strike Price
PSP 1	928,127	31.61
CARES Act loan warrants	427,080	31.61
PSP 2	305,499	52.25
PSP 3	221,812	66.39
Outstanding December 31, 2021	1,882,518

Accumulated Other Comprehensive Loss (AOCL)

Components of accumulated other comprehensive loss, net of tax (in millions):  

	2021		2020
Related to marketable securities	$	(4)	$	23
Related to employee benefit plans	(252)		(498)
Related to interest rate derivatives	(6)		(19)
	$	(262)	$	(494)