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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
_____________
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of earliest event
reported: November 16, 2005
AMR CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 1-8400 75-1825172
(State of Incorporation) (Commission File Number) (IRS Employer
Identification No.)
4333 Amon Carter Blvd. Fort Worth, Texas 76155
(Address of principal executive offices) (Zip Code)
(817) 963-1234
(Registrant's telephone number)
(Former name or former address, if changed since last report.)
Check the appropriate box below if the Form 8-K filing is
intended to simultaneously satisfy the filing obligation of the
registrant under any of the following provisions:
[ ] Written communications pursuant to Rule 425 under the
Securities Act (17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the
Exchange Act (17 CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b)
under the Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c)
under the Exchange Act (17 CFR 240.13e-4(c))
Item 1.01. Entry into a Material Definitive Agreement.
In 1993 the AMR Corporation ("AMR") Board of Directors (the
"Board") introduced, as a component of stock based long term
compensation, a long-term performance based plan. The performance
measurement period for each plan is three years. If performance
metrics are achieved at the end of the measurement period, awards
under the plans are made in April of the following year.
The American Jobs Creation Act of 2004 necessitates amendments to
the Performance Unit Plans at AMR so that, consistent with
historical practice, any awards will continue to be paid in
April.
On November 16, 2005, the Compensation Committee of the Board
amended the following compensation plans and related award
agreements:
2003/2005 Performance Unit Plan for Officers and Key Employees;
2004/2006 Performance Unit Plan for Officers and Key Employees;
2005/2007 Performance Unit Plan for Officers and Key Employees.
The amendments specify that an award (if any) resulting from the
achievement of the performance measures will be distributed in
April of the year following the conclusion of the plan's three year
measurement period. Other amendments were approved to ensure that
the plans are in compliance with the provisions of the American
Jobs Creation Act of 2004. All executive officers of American
participate in these plans and related agreements. Other than the
changes noted above, there were no changes made to any of the
other provisions of the Performance Unit Plans (e.g. units
awarded, measurement periods, performance criteria).
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act
of 1934, the registrant has duly caused this report to be signed
on its behalf by the undersigned hereunto duly authorized.
AMR CORPORATION
/s/ Charles D. MarLett
Charles D. MarLett
Corporate Secretary
Dated: November 18, 2005
EXHIBIT INDEX
Exhibit Description
99.1 2003-2005 Performance Unit Plan for Officers and Key
Employees, as Amended and Restated November 16, 2005
99.2 Form of 2003-2005 Performance Unit Agreement, as Amended
and Restated
99.3 2004-2006 Performance Unit Plan for Officers and Key
Employees, as Amended and Restated November 16, 2005
99.4 Form of 2004-2006 Performance Unit Agreement, as Amended
and Restated
99.5 2005-2007 Performance Unit Plan for Officers and Key
Employees, as Amended and Restated November 16, 2005
99.6 Form of 2005-2007 Performance Unit Agreement, as Amended
and Restated
Exhibit 99.1
2003 - 2005 PERFORMANCE UNIT PLAN
FOR OFFICERS AND KEY EMPLOYEES, AS AMENDED AND RESTATED NOVEMBER
16, 2005
Purpose
The purpose of the 2003 - 2005 AMR Corporation Performance Unit
Plan ("Plan") for Officers and Key Employees is to provide
greater incentive to officers and key employees of the
subsidiaries and affiliates of AMR Corporation ("AMR" or "the
Corporation") to achieve the highest level of individual
performance and to meet or exceed specified goals which will
contribute to the success of the Corporation.
Definitions
For purposes of the Plan, the following definitions will control:
"Affiliate" is defined as a subsidiary of AMR or any entity that
is designated by the Committee as a participating employer under
the Plan, provided that AMR directly or indirectly owns at least
20% of the combined voting power of all classes of stock of such
entity.
"Committee" is defined as the Compensation Committee, or its
successor, of the AMR Board of Directors.
"Comparator Group" is defined as the six major U.S. based
carriers including AMR Corporation, Continental Airlines, Inc.,
Delta Air Lines, Inc., Northwest Airlines Corp., Southwest
Airlines Co., and UAL Corporation.
"Measurement Period" is defined as the three year period
beginning January 1, 2003 and ending December 31, 2005.
"Total Shareholder Return (TSR)" is defined as the rate of return
reflecting stock price appreciation plus reinvestment of
dividends over the Measurement Period. The average Daily Closing
Stock Price (adjusted for splits and dividends) for the three
months prior to the beginning and ending points of the
Measurement Period will be used to smooth out market
fluctuations.
"Daily Closing Stock Price" is defined as the stock price at the
close of trading (4:00 PM EST) of the National Exchange on which
the stock is traded.
"National Exchange" is defined as either the New York Stock
Exchange (NYSE), the National Association of Stock Dealers and
Quotes (NASDAQ), or the American Stock Exchange (AMEX).
Accumulation of Units
Any payment under the Plan will be determined by (i) the
Corporation's TSR rank within the Comparator Group and (ii) the
terms and conditions of the award agreement between the
Corporation and the employee. The distribution percentage of
target units, based on rank, is specified below:
Granted Shares - Percent of Target Based on Rank
Rank 6 5 4 3 2 1
Payout % 0% 50% 75% 100% 135% 175%
In the event that a carrier (or carriers) in the Comparator Group
ceases to trade on a National Exchange at any point in the
Measurement Period, the following distribution percentage of
target units, based on rank and the number of remaining
comparators, will be used accordingly.
5 Comparators
Granted Units - Percent of Target Based on Rank
Rank 5 4 3 2 1
Payout % 50% 75% 100% 135% 175%
4 Comparators
Granted Units - Percent of Target Based on Rank
Rank 4 3 2 1
Payout % 75% 100% 135% 175%
3 Comparators
Granted Units - Percent of Target Based on Rank
Rank 3 2 1
Payout % 50% 135% 175%
Administration
The Committee shall have authority to administer and interpret
the Plan, establish administrative rules, approve eligible
participants, and take any other action necessary for the proper
and efficient operation of the Plan. The distribution percentage
of units, if any, will be determined based on an audit of AMR's
TSR rank by the General Auditor of American Airlines, Inc. A
summary of awards under the Plan shall be provided to the Board
of Directors at the first regular meeting following determination
of the awards. The awards will be paid on April 28, 2006 and any
such payments will be based upon the Fair Market Value of the
Corporation's Common Stock on April 19, 2006, or such date the
award is approved for payment by the Committee.
General
Neither this Plan nor any action taken hereunder shall be
construed as giving any employee or participant the right to be
retained in the employ of American Airlines, Inc. or an
Affiliate.
Nothing in the Plan shall be deemed to give any employee any
right, contractually or otherwise, to participate in the Plan or
in any benefits hereunder, other than the right to receive an
award as may have been expressly awarded by the Committee subject
to the terms and conditions of the award agreement between the
Corporation and the employee.
In the event of any act of God, war, natural disaster, aircraft
grounding, revocation of operating certificate, terrorism,
strike, lockout, labor dispute, work stoppage, fire, epidemic or
quarantine restriction, act of government, critical materials
shortage, or any other act beyond the control of the Corporation,
whether similar or dissimilar, (each a "Force Majeure Event"),
which Force Majeure Event affects the Corporation or its
subsidiaries or its Affiliates, the Committee, in its sole
discretion, may (i) terminate or (ii) suspend, delay, defer (for
such period of time as the Committee may deem necessary), or
substitute any awards due currently or in the future under the
Plan, including, but not limited to, any awards that have accrued
to the benefit of participants but have not yet been paid, in any
case to the extent permitted under Proposed Treasury Regulation
1.409A-3(d) and/or 1.409A-3(e), or successor guidance thereto.
In consideration of the employee's privilege to participate in
the Plan, the employee agrees (i) not to disclose any trade
secrets of, or other confidential/restricted information of,
American Airlines, Inc. or its Affiliates to any unauthorized
party and, (ii) not to make any unauthorized use of such trade
secrets or confidential or restricted information during his or
her employment with American Airlines, Inc. or its Affiliates or
after such employment is terminated, and (iii) not to solicit any
then current employees of American Airlines, Inc. or any
Subsidiaries of the Corporation to join the employee at his or
her new place of employment after his or her employment with
American Airlines, Inc. is terminated. The failure by the
employee to abide by the foregoing obligations shall result in
the award being forfeited in its entirety.
The Committee may amend, suspend, or terminate the Plan at any
time.
Exhibit 99.2
2003 - 2005 PERFORMANCE UNIT AGREEMENT
AS AMENDED AND RESTATED
This performance unit agreement ("Agreement") is amended and
restated as of November 16, 2005, by and between AMR Corporation,
a Delaware corporation (the "Corporation"), and First Last (the
"Employee" or "Recipient"), employee number 000000.
WHEREAS, pursuant to the Performance Unit Program (the
"Program") adopted by the Board of Directors of the Corporation
(the "Board"), the Compensation Committee of the Board (the
"Committee") has determined to make a Program grant to the
Employee of performance units (subject to the terms of the 2003
Performance Unit Plan (the "2003 Unit Plan") and this Agreement),
as an inducement for the Employee to remain an employee of the
Corporation (or a Subsidiary or Affiliate thereof), and to retain
and motivate such Employee during such employment.
This Agreement sets forth the terms and conditions attendant
to the performance units granted under the 2003 Unit Plan.
1. Grant of Award. The Recipient is hereby granted as of
Date, (the "Grant Date") performance units (the "Award"), subject
to the terms and conditions of this Agreement with respect to
units performance units (collectively, the "Units"). The Units
covered by the Award shall vest, if at all, in accordance with
Section 2. On the date the Units vest (if at all), Recipient will
receive, net of applicable withholding or applicable social
security taxes, a payment representing the product of (i) the
number of vested Units and (ii) the average of the high and low
price of the Corporation's Common Stock, $1.00 par value per share
on April 19, 2006, or such date the award is approved for payment
by the Committee.
2. Vesting.
(a) The Units will vest, if at all, in accordance with
Schedule A, attached hereto and made a part of this Agreement.
(b) In the event Recipient's employment with the Corporation
(or a Subsidiary or Affiliate thereof) is terminated prior to the
end of the three year measurement period set forth in Schedule A
(the "Measurement Period") due to the Recipient's death,
Disability (as defined in section 409A(a)(2)(C) of the Internal
Revenue Code of 1986, as amended, (the "Code")), Retirement or
termination not for Cause (each an "Early Termination") the Award
will vest, if at all, on a prorata basis and will be paid to the
Employee (or, in the event of the Employee's death, the Employee's
designated beneficiary for purposes of the Award, or in the
absence of an effective beneficiary designation, the Employee's
estate). The prorata basis will be a percentage where the
denominator is 36 and the numerator is the number of months from
January 1, 2003 through the month of Early Termination, inclusive.
This prorata basis will be paid to the Recipient at the same time
as payments are made to then current employees who have been
granted Units under the 2003 Unit Plan, subject to Section 2(f) of
this Agreement.
(c) In the event Recipient's employment with the Corporation
(or any Subsidiary or Affiliate thereof) is terminated for Cause,
or if the Recipient terminates his/her employment with the
Corporation (or any Subsidiary or Affiliate thereof), each
occurring prior to the payment contemplated by this Agreement, the
Award shall be forfeited in its entirety.
(d) If prior to the payment contemplated by this Agreement,
the Recipient becomes an employee of a Subsidiary that is not
wholly owned, directly or indirectly, by the Corporation, or if
the Recipient begins a leave of absence without reinstatement
rights, then in each case the Award shall be forfeited in its
entirety.
(e) In the event of a Change in Control of the Corporation
prior to the complete distribution of the Award, the Award will be
paid within 60 days of the date of the Change in Control. In such
event, the Vesting Date shall be the date of the Change in
Control. The term "Change in Control" is defined for purposes of
this Agreement in Section 6.
(f) Notwithstanding the provisions of Section 2(b), if the
Employee is a person subject to section 409A(a)(2)(B)(i) of the
Code, any payment on account of Retirement or termination not for
Cause of the Employee shall be delayed until the sixth month
anniversary of the date of separation from employment due to
Retirement or termination not for Cause.
3. Transfer Restrictions. This Award is non-transferable
otherwise than by will or by the laws of descent and distribution,
and may not otherwise be assigned, pledged or hypothecated and
shall not be subject to execution, attachment or similar process.
Upon any attempt by the Recipient (or the Recipient's successor in
interest after the Recipient's death) to effect any such
disposition, or upon the levy of any such process, the Award may
immediately become null and void, at the discretion of the
Committee.
4. Miscellaneous. This Agreement (a) shall be binding
upon and inure to the benefit of any successor of the Corporation,
(b) shall be governed by the laws of the State of Texas and any
applicable laws of the United States, and (c) may not be amended
without the written consent of both the Corporation and the
Recipient. No contract or right of employment shall be implied by
this Agreement.
In consideration of the Employee's privilege to participate
in the Plan, the Employee agrees (i) not to disclose any trade
secrets of, or other confidential/restricted information of,
American Airlines, Inc. ("American") or its Affiliates to any
unauthorized party and (ii) not to make any unauthorized use of
such trade secrets or confidential or restricted information
during his or her employment with American or its Affiliates or
after such employment is terminated, and (iii) not to solicit any
then current employees of American or any other Subsidiaries of
the Corporation to join the Employee at his or her new place of
employment after his or her employment with American or its
Affiliates is terminated. The failure by the Employee to abide by
the foregoing obligations shall result in the Award being
forfeited in its entirety.
The Employee shall not have the right to defer payment of
the Award. Except as provided in this Agreement, the Committee
and Corporation shall not accelerate payment of the Award
5. Adjustments in Awards. In the event of a Stock
dividend, Stock split, merger, consolidation, re-organization, re-
capitalization or other change in the corporate structure of the
Corporation, appropriate adjustments may be made by the Board of
Directors in the number of Units awarded.
6. Incorporation of 1998 Plan Provisions. Capitalized
terms not otherwise defined herein (inclusive of Schedule A) shall
have the meanings set forth for such terms in the Corporation's
1998 Long Term Incentive Plan, as amended. For purposes of Section
2(e), the term "Change in Control" shall mean a "change in
ownership" or "change in effective control", or "change in
ownership of the assets" of the Corporation, as determined
pursuant to Internal Revenue Service Notice 2005-1 (or successor
guidance thereto under section 409A of the Code).
7. American Jobs Creation Act. Amendments to this
Agreement may be made by the Corporation, without the Employee's
consent, in order to ensure compliance with the American Jobs
Creation Act of 2004.
IN WITNESS HEREOF, the Recipient and the Corporation
have executed this Performance Unit Agreement as of the day, month
and year set forth above.
RECIPIENT AMR CORPORATION
/s/ /s/ Charles D. MarLett
Charles D. MarLett
Corporate Secretary
SCHEDULE A
2003 - 2005 PERFORMANCE UNIT PLAN
FOR OFFICERS AND KEY EMPLOYEES, AS AMENDED AND RESTATED
NOVEMBER 16, 2005
The purpose of the 2003 - 2005 AMR Corporation Performance Unit
Plan ("Plan") for Officers and Key Employees is to provide
greater incentive to officers and key employees of the
subsidiaries and affiliates of AMR Corporation ("AMR" or "the
Corporation") to achieve the highest level of individual
performance and to meet or exceed specified goals which will
contribute to the success of the Corporation.
Definitions
For purposes of the Plan, the following definitions will control:
"Affiliate" is defined as a subsidiary of AMR or any entity that
is designated by the Committee as a participating employer under
the Plan, provided that AMR directly or indirectly owns at least
20% of the combined voting power of all classes of stock of such
entity.
"Committee" is defined as the Compensation Committee, or its
successor, of the AMR Board of Directors.
"Comparator Group" is defined as the six major U.S. based
carriers including AMR Corporation, Continental Airlines, Inc.,
Delta Air Lines, Inc., Northwest Airlines Corp., Southwest
Airlines Co., and UAL Corporation.
"Measurement Period" is defined as the three year period
beginning January 1, 2003 and ending December 31, 2005.
"Total Shareholder Return (TSR)" is defined as the rate of return
reflecting stock price appreciation plus reinvestment of
dividends over the Measurement Period. The average Daily Closing
Stock Price (adjusted for splits and dividends) for the three
months prior to the beginning and ending points of the
Measurement Period will be used to smooth out market
fluctuations.
"Daily Closing Stock Price" is defined as the stock price at the
close of trading (4:00 PM EST) of the National Exchange on which
the stock is traded.
"National Exchange" is defined as either the New York Stock
Exchange (NYSE), the National Association of Stock Dealers and
Quotes (NASDAQ), or the American Stock Exchange (AMEX).
Accumulation of Units
Any payment under the Plan will be determined by (i) the
Corporation's TSR rank within the Comparator Group and (ii) the
terms and conditions of the award agreement between the
Corporation and the employee. The distribution percentage of
target units, based on rank, is specified below:
Granted Shares - Percent of Target Based on Rank
Rank 6 5 4 3 2 1
Payout % 0% 50% 75% 100% 135% 175%
In the event that a carrier (or carriers) in the Comparator Group
ceases to trade on a National Exchange at any point in the
Measurement Period, the following distribution percentage of
target units, based on rank and the number of remaining
comparators, will be used accordingly.
5 Comparators
Granted Units - Percent of Target Based on Rank
Rank 5 4 3 2 1
Payout % 50% 75% 100% 135% 175%
4 Comparators
Granted Units - Percent of Target Based on Rank
Rank 4 3 2 1
Payout % 75% 100% 135% 175%
3 Comparators
Granted Units - Percent of Target Based on Rank
Rank 3 2 1
Payout % 50% 135% 175%
Administration
The Committee shall have authority to administer and interpret
the Plan, establish administrative rules, approve eligible
participants, and take any other action necessary for the proper
and efficient operation of the Plan. The distribution percentage
of units, if any, will be determined based on an audit of AMR's
TSR rank by the General Auditor of American Airlines, Inc. A
summary of awards under the Plan shall be provided to the Board
of Directors at the first regular meeting following determination
of the awards. The awards will be paid on April 28, 2006 and any
such payments will be based upon the Fair Market Value of the
Corporation's Common Stock on April 19, 2006, or such date the
award is approved for payment by the Committee.
General
Neither this Plan nor any action taken hereunder shall be
construed as giving any employee or participant the right to be
retained in the employ of American Airlines, Inc. or an
Affiliate.
Nothing in the Plan shall be deemed to give any employee any
right, contractually or otherwise, to participate in the Plan or
in any benefits hereunder, other than the right to receive an
award as may have been expressly awarded by the Committee subject
to the terms and conditions of the award agreement between the
Corporation and the employee.
In the event of any act of God, war, natural disaster, aircraft
grounding, revocation of operating certificate, terrorism,
strike, lockout, labor dispute, work stoppage, fire, epidemic or
quarantine restriction, act of government, critical materials
shortage, or any other act beyond the control of the Corporation,
whether similar or dissimilar, (each a "Force Majeure Event"),
which Force Majeure Event affects the Corporation or its
subsidiaries or its Affiliates, the Committee, in its sole
discretion, may (i) terminate or (ii) suspend, delay, defer (for
such period of time as the Committee may deem necessary), or
substitute any awards due currently or in the future under the
Plan, including, but not limited to, any awards that have accrued
to the benefit of participants but have not yet been paid, in any
case to the extent permitted under Proposed Treasury Regulation
1.409A-3(d) and/or 1.409A-3(e), or successor guidance thereto.
In consideration of the employee's privilege to participate in
the Plan, the employee agrees (i) not to disclose any trade
secrets of, or other confidential/restricted information of,
American Airlines, Inc. or its Affiliates to any unauthorized
party and, (ii) not to make any unauthorized use of such trade
secrets or confidential or restricted information during his or
her employment with American Airlines, Inc. or its Affiliates or
after such employment is terminated, and (iii) not to solicit any
then current employees of American Airlines, Inc. or any
Subsidiaries of the Corporation to join the employee at his or
her new place of employment after his or her employment with
American Airlines, Inc. is terminated. The failure by the
employee to abide by the foregoing obligations shall result in
the award being forfeited in its entirety.
The Committee may amend, suspend, or terminate the Plan at any
time.
Exhibit 99.3
2004 - 2006 PERFORMANCE UNIT PLAN
FOR OFFICERS AND KEY EMPLOYEES, AS AMENDED AND RESTATED NOVEMBER
16, 2005
Purpose
The purpose of the 2004 - 2006 AMR Corporation Performance Unit
Plan ("Plan") for Officers and Key Employees is to provide
greater incentive to officers and key employees of the
subsidiaries and affiliates of AMR Corporation ("AMR" or "the
Corporation") to achieve the highest level of individual
performance and to meet or exceed specified goals which will
contribute to the success of the Corporation.
Definitions
For purposes of the Plan, the following definitions will control:
"Affiliate" is defined as a subsidiary of AMR or any entity that
is designated by the Committee as a participating employer under
the Plan, provided that AMR directly or indirectly owns at least
20% of the combined voting power of all classes of stock of such
entity.
"Committee" is defined as the Compensation Committee, or its
successor, of the AMR Board of Directors.
"Comparator Group" is defined as the following seven U.S. based
carriers including AMR Corporation, Continental Airlines, Inc.,
Delta Air Lines, Inc., JetBlue Airways, Northwest Airlines Corp.,
Southwest Airlines Co. and US Airways Group, Inc.
"Corporate Objectives" is defined as being the objectives
established by the Committee at the beginning of each fiscal year
during the Measurement Period.
"Measurement Period" is defined as the three year period
beginning January 1, 2004 and ending December 31, 2006.
"Total Shareholder Return (TSR)" is defined as the rate of return
reflecting stock price appreciation plus reinvestment of
dividends over the Measurement Period. The average Daily Closing
Stock Price (adjusted for splits and dividends) for the three
months prior to the beginning and ending points of the
Measurement Period will be used to smooth out market
fluctuations.
"Daily Closing Stock Price" is defined as the stock price at the
close of trading (4:00 PM EST) of the National Exchange on which
the stock is traded.
"National Exchange" is defined as either the New York Stock
Exchange (NYSE), the National Association of Stock Dealers and
Quotes (NASDAQ), or the American Stock Exchange (AMEX).
Accumulation of Units
Any payment under the Plan with respect to the units will be
determined by (i) the Corporation's TSR rank within the
Comparator Group and/or (ii) the Corporation's attainment of the
Corporate Objectives during each year of the Measurement Period
and (iii) the terms and conditions of the award agreement between
the Corporation and the employee. The distribution percentage of
units pursuant to the TSR metric and based on rank, is specified
below:
Granted Shares - Percent of Target Based on Rank
Rank 7 6 5 4 3 2 1
Payout % 0% 25% 50% 75% 100% 135% 175%
In the event that a carrier (or carriers) in the Comparator Group
ceases to trade on a National Exchange at any point in the
Measurement Period, the following distribution percentage of
target units, based on rank and the number of remaining
comparators, will be used accordingly.
6 Comparators
Granted Shares - Percent of Target Based on Rank
Rank 6 5 4 3 2 1
Payout % 0% 50% 75% 100% 135% 175%
5 Comparators
Granted Units - Percent of Target Based on Rank
Rank 5 4 3 2 1
Payout % 50% 75% 100% 135% 175%
4 Comparators
Granted Units - Percent of Target Based on Rank
Rank 4 3 2 1
Payout % 75% 100% 135% 175%
3 Comparators
Granted Units - Percent of Target Based on Rank
Rank 3 2 1
Payout % 100% 135% 175%
At the end of each fiscal year during the Measurement Period, the
Committee will determine whether the Corporate Objectives have
been achieved. At the end of the Measurement Period the Committee
will determine the distribution of units based upon the TSR
metric and, with respect to senior officer awards, the Corporate
Objectives. The number of units that may vest will range from 0%
to 175% of the target award.
Administration
The Committee shall have authority to administer and interpret
the Plan, establish administrative rules, approve eligible
participants, and take any other action necessary for the proper
and efficient operation of the Plan. The TSR metric will be
determined based on an audit of AMR's TSR rank by the General
Auditor of American Airlines, Inc. A summary of awards under the
Plan shall be provided to the Board of Directors at the first
regular meeting following determination of the awards. The
awards will be paid on April 30, 2007, and any such payments will
be based upon the Fair Market Value of the Corporation's Common
Stock on April 18, 2007, or such date the award is approved for
payment by the Committee.
Corporate Objectives will be used as a metric for determining the
distribution of units only for senior officers of the Corporation
(or a Subsidiary thereof) unless the Committee determines
otherwise.
General
Neither this Plan nor any action taken hereunder shall be
construed as giving any employee or participant the right to be
retained in the employ of American Airlines, Inc. or an
Affiliate.
Nothing in the Plan shall be deemed to give any employee any
right, contractually or otherwise, to participate in the Plan or
in any benefits hereunder, other than the right to receive an
award as may have been expressly awarded by the Committee subject
to the terms and conditions of the award agreement between the
Corporation and the employee.
In the event of any act of God, war, natural disaster, aircraft
grounding, revocation of operating certificate, terrorism,
strike, lockout, labor dispute, work stoppage, fire, epidemic or
quarantine restriction, act of government, critical materials
shortage, or any other act beyond the control of the Corporation,
whether similar or dissimilar, (each a "Force Majeure Event"),
which Force Majeure Event affects the Corporation or its
Subsidiaries or its Affiliates, the Committee, in its sole
discretion, may (i) terminate or (ii) suspend, delay, defer (for
such period of time as the Committee may deem necessary), or
substitute any awards due currently or in the future under the
Plan, including, but not limited to, any awards that have accrued
to the benefit of participants but have not yet been paid, in any
case to the extent permitted under Proposed Treasury Regulation
1.409A-e(d) and/or 1.409A-3(e). or successor guidance thereto.
In consideration of the employee's privilege to participate in
the Plan, the employee agrees (i) not to disclose any trade
secrets of, or other confidential/restricted information of,
American Airlines, Inc. or its Affiliates to any unauthorized
party and, (ii) not to make any unauthorized use of such trade
secrets or confidential or restricted information during his or
her employment with American Airlines, Inc. or its Affiliates or
after such employment is terminated, and (iii) not to solicit any
then current employees of American Airlines, Inc. or any other
Subsidiaries of AMR to join the employee at his or her new place
of employment after his or her employment with American Airlines,
Inc. or its Affiliates is terminated. The failure by the
employee to abide by the foregoing obligations shall result in
the award being forfeited in its entirety.
The Committee may amend, suspend, or terminate the Plan at any
time.
Exhibit 99.4
2004 - 2006
PERFORMANCE UNIT AGREEMENT, AS AMENDED AND RESTATED
This performance unit agreement ("Agreement") is amended and
restated as of November 16, 2005, by and between AMR Corporation,
a Delaware corporation (the "Corporation"), and First Last (the
"Employee"), employee number 000000.
WHEREAS, pursuant to the Performance Unit Program (the
"Program") adopted by the Board of Directors of the Corporation
(the "Board"), the Compensation Committee of the Board has
determined to make a Program grant to the Employee of performance
units (subject to the terms of the 2004/2006 Performance Unit Plan
for Officers and Key Employees (the "2004 Unit Plan") and this
Agreement), as an inducement for the Employee to remain an
employee of the Corporation (or a Subsidiary or Affiliate
thereof), and to retain and motivate such Employee during such
employment.
This Agreement sets forth the terms and conditions attendant
to the performance units granted under the 2004 Unit Plan.
1. Grant of Award. The Employee is hereby granted as of
Date, (the "Grant Date") performance units (the "Award"), subject
to the terms and conditions of this Agreement with respect to
units performance units (collectively, the "Units"). The Units
covered by the Award shall vest, if at all, in accordance with
Section 2. On the date the Units vest (if at all), Employee will
receive, net of applicable withholding or applicable social
security taxes, a payment representing the product of (i) the
number of vested Units and (ii) the average of the high and low
price of the Corporation's Common Stock, $1.00 par value per
share, on April 18, 2007, or such date the award is approved for
payment by the Committee.
2. Vesting.
(a) The Units will vest and be paid, if at all, in
accordance with Schedule A, attached hereto and made a part of
this Agreement.
(b) In the event Employee's employment with the Corporation
(or a Subsidiary or Affiliate thereof) is terminated prior to the
end of the three year measurement period set forth in Schedule A
(the "Measurement Period") due to the Employee's death, Disability
(as defined in section 409A(a)(2)(C) of the Internal Revenue Code
of 1986, as amended (the "Code")), Retirement or termination not
for Cause (each an "Early Termination") the Award will vest, if at
all, on a pro-rata basis and will be paid to the Employee (or, in
the event of the Employee's death, the Employee's designated
beneficiary for purposes of the Award, or in the absence of an
effective beneficiary designation, the Employee's estate). The
pro-rata basis will be a percentage where the denominator is 36
and the numerator is the number of months from January 1, 2004
through the month of Early Termination, inclusive. This pro-rata
basis will be paid to the Employee at the same time as payments
are made to then current employees who have been granted Units
under the 2004 Unit Plan, subject to Section 2(f) of this
Agreement.
(c) In the event Employee's employment with the Corporation
(or any Subsidiary or Affiliate thereof) is terminated for Cause,
or if the Employee terminates his/her employment with the
Corporation (or any Subsidiary or Affiliate thereof), each
occurring prior to the payment contemplated by this Agreement, the
Award shall be forfeited in its entirety.
(d) If prior to the payment contemplated by this Agreement,
the Employee becomes an employee of a Subsidiary that is not
wholly owned, directly or indirectly, by the Corporation, or if
the Employee begins a leave of absence without reinstatement
rights, then in each case the Award shall be forfeited in its
entirety.
(e) In the event of a Change in Control of the Corporation
prior to the complete distribution of the Award, the Award will be
paid within 60 days of the date of the Change in Control. In such
event, the Vesting Date shall be the date of the Change in
Control. The term "Change in Control" is defined for purposes of
this Agreement in Section 6.
(f) Notwithstanding the provisions of Section 2(b), if the
Employee is a person subject to section 409A(a)(2)(B)(i) of the
Code, any payment on account of Retirement or termination not for
Cause of the Employee shall be delayed until the sixth month
anniversary of the date of separation from employment due to
Retirement or termination not for Cause.
3. Transfer Restrictions. This Award is non-transferable
other than by will or by the laws of descent and distribution, and
may not otherwise be assigned, pledged or hypothecated and shall
not be subject to execution, attachment or similar process. Upon
any attempt by the Employee (or the Employee's successor in
interest after the Employee's death) to effect any such
disposition, or upon the levy of any such process, the Award may
immediately become null and void, at the discretion of the
Committee.
4. Miscellaneous. This Agreement (a) shall be binding upon
and inure to the benefit of any successor of the Corporation, (b)
shall be governed by the laws of the State of Texas and any
applicable laws of the United States, and (c) may not be amended
without the written consent of both the Corporation and the
Employee. No contract or right of employment shall be implied by
this Agreement.
In the event the Employee's employment is terminated by
reason of Early or Normal Retirement and the Employee is
subsequently is employed by a competitor of the Company, the
Company reserves the right, upon notice to the Employee, to
declare the Award forfeited and of no further validity.
In consideration of the Employee's privilege to participate
in the Plan, the Employee agrees (i) not to disclose any trade
secrets of, or other confidential/restricted information of,
American Airlines, Inc. ("American") or its Affiliates to any
unauthorized party and (ii) not to make any unauthorized use of
such trade secrets or confidential or restricted information
during his or her employment with American or its Affiliates or
after such employment is terminated, and (iii) not to solicit any
then current employees of American or any other Subsidiaries of
the Corporation to join the Employee at his or her new place of
employment after his or her employment with American or its
Affiliates is terminated. The failure by the Employee to abide by
the foregoing obligations shall result in the Award being
forfeited in its entirety.
The Employee shall not have the right to defer payment of the
Award. Except as provided in this Agreement, the Committee and
Corporation shall not accelerate payment of the Award.
5. Adjustments in Awards. In the event of a Stock
dividend, Stock split, merger, consolidation, re-organization, re-
capitalization or other change in the corporate structure of the
Corporation, appropriate adjustments may be made by the Board in
the number of Units awarded.
6. Incorporation of 2003 Plan Provisions. Capitalized terms
not otherwise defined herein (inclusive of Schedule A) shall have
the meanings set forth for such terms in the Corporation's 2003
Employee Stock Incentive Plan. For purposes of Section 2(e), the
term "Change in Control" shall mean a "change in ownership" or
"change in effective control", or "change in ownership of the
assets" of the Corporation, as determined pursuant to Internal
Revenue Service Notice 2005-1 (or successor guidance thereto under
section 409A of the Code).
7. American Jobs Creation Act. Amendments to this
Agreement may be made by the Corporation, without the Employee's
consent, in order to ensure compliance with the American Jobs
Creation Act of 2004.
IN WITNESS HEREOF, the Employee and the Corporation have
executed this Performance Unit Agreement as of the day, month and
year set forth above.
EMPLOYEE AMR CORPORATION
/s/ /s/ Charles D. MarLett
Charles D. MarLett
Corporate Secretary
SCHEDULE A
2004 - 2006 PERFORMANCE UNIT PLAN
FOR OFFICERS AND KEY EMPLOYEES, AS AMENDED AND RESTATED NOVEMBER
16, 2005
Purpose
The purpose of the 2004 - 2006 AMR Corporation Performance Unit
Plan ("Plan") for Officers and Key Employees is to provide
greater incentive to officers and key employees of the
subsidiaries and affiliates of AMR Corporation ("AMR" or "the
Corporation") to achieve the highest level of individual
performance and to meet or exceed specified goals which will
contribute to the success of the Corporation.
Definitions
For purposes of the Plan, the following definitions will control:
"Affiliate" is defined as a subsidiary of AMR or any entity that
is designated by the Committee as a participating employer under
the Plan, provided that AMR directly or indirectly owns at least
20% of the combined voting power of all classes of stock of such
entity.
"Committee" is defined as the Compensation Committee, or its
successor, of the AMR Board of Directors.
"Comparator Group" is defined as the following seven U.S. based
carriers including AMR Corporation, Continental Airlines, Inc.,
Delta Air Lines, Inc., JetBlue Airways, Northwest Airlines Corp.,
Southwest Airlines Co. and US Airways Group, Inc.
"Corporate Objectives" is defined as being the objectives
established by the Committee at the beginning of each fiscal year
during the Measurement Period.
"Measurement Period" is defined as the three year period
beginning January 1, 2004 and ending December 31, 2006.
"Total Shareholder Return (TSR)" is defined as the rate of return
reflecting stock price appreciation plus reinvestment of
dividends over the Measurement Period. The average Daily Closing
Stock Price (adjusted for splits and dividends) for the three
months prior to the beginning and ending points of the
Measurement Period will be used to smooth out market
fluctuations.
"Daily Closing Stock Price" is defined as the stock price at the
close of trading (4:00 PM EST) of the National Exchange on which
the stock is traded.
"National Exchange" is defined as either the New York Stock
Exchange (NYSE), the National Association of Stock Dealers and
Quotes (NASDAQ), or the American Stock Exchange (AMEX).
Accumulation of Units
Any payment under the Plan with respect to the units will be
determined by (i) the Corporation's TSR rank within the
Comparator Group and/or (ii) the Corporation's attainment of the
Corporate Objectives during each year of the Measurement Period
and (iii) the terms and conditions of the award agreement between
the Corporation and the employee. The distribution percentage of
units pursuant to the TSR metric and based on rank, is specified
below:
Granted Shares - Percent of Target Based on Rank
Rank 7 6 5 4 3 2 1
Payout % 0% 25% 50% 75% 100% 135% 175%
In the event that a carrier (or carriers) in the Comparator Group
ceases to trade on a National Exchange at any point in the
Measurement Period, the following distribution percentage of
target units, based on rank and the number of remaining
comparators, will be used accordingly.
6 Comparators
Granted Shares - Percent of Target Based on Rank
Rank 6 5 4 3 2 1
Payout % 0% 50% 75% 100% 135% 175%
5 Comparators
Granted Units - Percent of Target Based on Rank
Rank 5 4 3 2 1
Payout % 50% 75% 100% 135% 175%
4 Comparators
Granted Units - Percent of Target Based on Rank
Rank 4 3 2 1
Payout % 75% 100% 135% 175%
3 Comparators
Granted Units - Percent of Target Based on Rank
Rank 3 2 1
Payout % 100% 135% 175%
At the end of each fiscal year during the Measurement Period, the
Committee will determine whether the Corporate Objectives have
been achieved. At the end of the Measurement Period the Committee
will determine the distribution of units based upon the TSR
metric and, with respect to senior officer awards, the Corporate
Objectives. The number of units that may vest will range from 0%
to 175% of the target award.
Administration
The Committee shall have authority to administer and interpret
the Plan, establish administrative rules, approve eligible
participants, and take any other action necessary for the proper
and efficient operation of the Plan. The TSR metric will be
determined based on an audit of AMR's TSR rank by the General
Auditor of American Airlines, Inc. A summary of awards under the
Plan shall be provided to the Board of Directors at the first
regular meeting following determination of the awards. The
awards will be paid on April 30, 2007, and any such payments will
be based upon the Fair Market Value of the Corporation's Common
Stock on April 18, 2007, or such date the award is approved for
payment by the Committee.
Corporate Objectives will be used as a metric for determining the
distribution of units only for senior officers of the Corporation
(or a Subsidiary thereof) unless the Committee determines
otherwise.
General
Neither this Plan nor any action taken hereunder shall be
construed as giving any employee or participant the right to be
retained in the employ of American Airlines, Inc. or an
Affiliate.
Nothing in the Plan shall be deemed to give any employee any
right, contractually or otherwise, to participate in the Plan or
in any benefits hereunder, other than the right to receive an
award as may have been expressly awarded by the Committee subject
to the terms and conditions of the award agreement between the
Corporation and the employee.
In the event of any act of God, war, natural disaster, aircraft
grounding, revocation of operating certificate, terrorism,
strike, lockout, labor dispute, work stoppage, fire, epidemic or
quarantine restriction, act of government, critical materials
shortage, or any other act beyond the control of the Corporation,
whether similar or dissimilar, (each a "Force Majeure Event"),
which Force Majeure Event affects the Corporation or its
Subsidiaries or its Affiliates, the Committee, in its sole
discretion, may (i) terminate or (ii) suspend, delay, defer (for
such period of time as the Committee may deem necessary), or
substitute any awards due currently or in the future under the
Plan, including, but not limited to, any awards that have accrued
to the benefit of participants but have not yet been paid, in any
case to the extent permitted under Proposed Treasury Regulation
1.409A-e(d) and/or 1.409A-3(e). or successor guidance thereto.
In consideration of the employee's privilege to participate in
the Plan, the employee agrees (i) not to disclose any trade
secrets of, or other confidential/restricted information of,
American Airlines, Inc. or its Affiliates to any unauthorized
party and, (ii) not to make any unauthorized use of such trade
secrets or confidential or restricted information during his or
her employment with American Airlines, Inc. or its Affiliates or
after such employment is terminated, and (iii) not to solicit any
then current employees of American Airlines, Inc. or any other
Subsidiaries of AMR to join the employee at his or her new place
of employment after his or her employment with American Airlines,
Inc. or its Affiliates is terminated. The failure by the
employee to abide by the foregoing obligations shall result in
the award being forfeited in its entirety.
The Committee may amend, suspend, or terminate the Plan at any
time.
Exhibit 99.5
2005 - 2007 PERFORMANCE UNIT PLAN
FOR OFFICERS AND KEY EMPLOYEES, AS AMENDED AND RESTATED
NOVEMBER 16, 2005
Purpose
The purpose of the 2005 - 2007 AMR Corporation Performance Unit
Plan ("Plan") for Officers and Key Employees is to provide
greater incentive to officers and key employees of the
subsidiaries and affiliates of AMR Corporation ("AMR" or "the
Corporation") to achieve the highest level of individual
performance and to meet or exceed specified goals which will
contribute to the success of the Corporation.
Definitions
For purposes of the Plan, the following definitions will control:
"Affiliate" is defined as a subsidiary of AMR or any entity that
is designated by the Committee as a participating employer under
the Plan, provided that AMR directly or indirectly owns at least
20% of the combined voting power of all classes of stock of such
entity.
"Committee" is defined as the Compensation Committee, or its
successor, of the AMR Board of Directors.
"Comparator Group" is defined as the following six U.S. based
carriers including AMR Corporation, Continental Airlines, Inc.,
Delta Air Lines, Inc., JetBlue Airways, Northwest Airlines Corp.
and Southwest Airlines Co.
"Corporate Objectives" is defined as being the objectives
established by the Committee at the beginning of each fiscal year
during the Measurement Period.
"Measurement Period" is defined as the three year period
beginning January 1, 2005 and ending December 31, 2007.
"Total Shareholder Return (TSR)" is defined as the rate of return
reflecting stock price appreciation plus reinvestment of
dividends over the Measurement Period. The average Daily Closing
Stock Price (adjusted for splits and dividends) for the three
months prior to the beginning and ending points of the
Measurement Period will be used to smooth out market
fluctuations.
"Daily Closing Stock Price" is defined as the stock price at the
close of trading (4:00 PM EST) of the National Exchange on which
the stock is traded.
"National Exchange" is defined as either the New York Stock
Exchange (NYSE), the National Association of Stock Dealers and
Quotes (NASDAQ), or the American Stock Exchange (AMEX).
Accumulation of Units
Any payment under the Plan with respect to the units will be
determined by (i) the Corporation's TSR rank within the
Comparator Group and/or (ii) the Corporation's attainment of the
Corporate Objectives during each year of the Measurement Period
and (iii) the terms and conditions of the award agreement between
the Corporation and the employee. The distribution percentage of
units pursuant to the TSR metric and based on rank, is specified
below:
Granted Shares - Percent of Target Based on Rank
Rank 6 5 4 3 2 1
Payout % 0% 50% 75% 100% 135% 175%
In the event that a carrier (or carriers) in the Comparator Group
ceases to trade on a National Exchange at any point in the
Measurement Period, the following distribution percentage of
target units, based on rank and the number of remaining
comparators, will be used accordingly.
5 Comparators
Granted Units - Percent of Target Based on Rank
Rank 5 4 3 2 1
Payout % 50% 75% 100% 135% 175%
4 Comparators
Granted Units - Percent of Target Based
on Rank
Rank 4 3 2 1
Payout % 75% 100% 135% 175%
3 Comparators
Granted Units - Percent of Target Based
on Rank
Rank 3 2 1
Payout % 100% 135% 175%
At the end of each fiscal year during the Measurement Period, the
Committee will determine whether the Corporate Objectives have
been achieved. At the end of the Measurement Period the Committee
will determine the distribution of units based upon the TSR
metric and, with respect to senior officer awards, the Corporate
Objectives. The number of units that may vest will range from 0%
to 175% of the target award.
Administration
The Committee shall have authority to administer and interpret
the Plan, establish administrative rules, approve eligible
participants, and take any other action necessary for the proper
and efficient operation of the Plan. The TSR metric will be
determined based on an audit of AMR's TSR rank by the General
Auditor of American Airlines, Inc. A summary of awards under the
Plan shall be provided to the Board of Directors at the first
regular meeting following determination of the awards. The
awards will be paid on April 30, 2008, and any such payments will
be based upon the Fair Market Value of the Corporation's Common
Stock on April 16, 2008, or such date the award is approved for
payment by the Committee.
Corporate Objectives will be used as a metric for determining the
distribution of units only for senior officers of the Corporation
(or a Subsidiary thereof) unless the Committee determines
otherwise.
General
Neither this Plan nor any action taken hereunder shall be
construed as giving any employee or participant the right to be
retained in the employ of American Airlines, Inc. or an
Affiliate.
Nothing in the Plan shall be deemed to give any employee any
right, contractually or otherwise, to participate in the Plan or
in any benefits hereunder, other than the right to receive an
award as may have been expressly awarded by the Committee subject
to the terms and conditions of the award agreement between the
Corporation and the employee.
In the event of any act of God, war, natural disaster, aircraft
grounding, revocation of operating certificate, terrorism,
strike, lockout, labor dispute, work stoppage, fire, epidemic or
quarantine restriction, act of government, critical materials
shortage, or any other act beyond the control of the Corporation,
whether similar or dissimilar, (each a "Force Majeure Event"),
which Force Majeure Event affects the Corporation or its
Subsidiaries or its Affiliates, the Committee, in its sole
discretion, may (i) terminate or (ii) suspend, delay, defer (for
such period of time as the Committee may deem necessary), or
substitute any awards due currently or in the future under the
Plan, including, but not limited to, any awards that have accrued
to the benefit of participants but have not yet been paid, in any
case to the extent permitted under proposed Treasury Regulation
1.409A-3(d) and/or 1.409A-3(e), or successor guidance thereto.
In consideration of the employee's privilege to participate in
the Plan, the employee agrees (i) not to disclose any trade
secrets of, or other confidential/restricted information of,
American Airlines, Inc. or its Affiliates to any unauthorized
party and, (ii) not to make any unauthorized use of such trade
secrets or confidential or restricted information during his or
her employment with American Airlines, Inc. or its Affiliates or
after such employment is terminated, and (iii) not to solicit any
then current employees of American Airlines, Inc. or any other
Subsidiaries of AMR to join the employee at his or her new place
of employment after his or her employment with American Airlines,
Inc. or its Affiliates is terminated. The failure by the
employee to abide by the foregoing obligations shall result in
the award being forfeited in its entirety.
The Committee may amend, suspend, or terminate the Plan at any
time.
EXHIBIT 99.6
2005 - 2007
PERFORMANCE UNIT AGREEMENT, AS AMENDED AND RESTATED
This performance unit agreement (this "Agreement") is
amended and restated as of November 16, 2005, by and between
AMR Corporation, a Delaware corporation (the "Corporation"),
and FNAME LNAME (the "Employee"), employee number 000000.
WHEREAS, pursuant to the 2005/2007 Performance Unit
Plan for Officers and Key Employees (the "2005 Unit Plan")
attached to this Agreement as Schedule A and incorporated
herein, and the Performance Unit Program (the "Program")
adopted by the Board of Directors of the Corporation (the
"Board"), the Compensation Committee of the Board (the
"Committee") has determined to make a Program grant to the
Employee of performance units (subject to the terms of the
Program and this Agreement), as an inducement for the
Employee to remain an employee of the Corporation (or a
Subsidiary or Affiliate thereof), and to retain and motivate
such Employee during such employment.
This Agreement sets forth the terms and conditions
attendant to the performance units granted under the 2005
Unit Plan.
1. Grant of Award. The Employee is hereby granted as
of Date, 2005, (the "Grant Date") performance units (the
"Award"), subject to the terms and conditions of this
Agreement with respect to 0,000 performance units
(collectively, the "Units"). The Units covered by the Award
shall vest, if at all, in accordance with Section 2. On the
date the Units vest (if at all), the Employee will receive,
net of applicable withholding or applicable social security
taxes, a payment representing the product of (i) the number
of vested Units and (ii) the average of the high and low
price of the Corporation's Common Stock, $1.00 par value per
share on April 16, 2008, or such date the award is approved
for payment by the Committee.
2. Vesting.
(a) The Units will vest and be paid, if at all, in
accordance with the terms of the Program attached as
Schedule A, which is made a part of this Agreement.
(b) In the event Employee's employment with the
Corporation (or a Subsidiary or Affiliate thereof) is
terminated prior to the end of the three year measurement
period set forth in Schedule A (the "Measurement Period")
due to the Employee's death, "Disability" (as defined in
section 409A(a)(2)(C) of the Internal Revenue Code of 1986,
as amended (the "Code")), Retirement or termination not for
Cause (each an "Early Termination") the Award will vest, if
at all, on a pro-rata basis and will be paid to the Employee
(or, in the event of the Employee's death, the Employee's
designated beneficiary for purposes of the Award, or in the
absence of an effective beneficiary designation, the
Employee's estate). The pro-rata basis will be a percentage
where the denominator is 36 and the numerator is the number
of months from January 1, 2005 through the month of Early
Termination, inclusive. This pro-rata Award will be paid to
the Employee at the same time as payments are made to then
current employees who have been granted Units under the 2005
Unit Plan, subject to Section 2(f) of this Agreement.
(c) In the event the Employee's employment with the
Corporation (or a Subsidiary or Affiliate thereof) is
terminated for Cause, or if the Employee terminates his/her
employment with the Corporation (or a Subsidiary or
Affiliate thereof), each occurring prior to the payment
contemplated by this Agreement, the Award shall be forfeited
in its entirety.
(d) If, prior to the payment contemplated by this
Agreement, the Employee becomes an employee of a Subsidiary
that is not wholly owned, directly or indirectly, by the
Corporation, or if the Employee begins a leave of absence
without reinstatement rights, then in each case the Award
shall be forfeited in its entirety.
(e) In the event of a Change in Control of the
Corporation prior to the complete distribution of the Award,
the Award will be paid within 60 days of the date of the
Change in Control. In such event, the Vesting Date shall be
the date of the Change in Control. The term "Change in
Control" is defined for purposes of this Agreement in
Section 6.
(f) Notwithstanding the provisions of Section 2(b), if
the Employee is a person subject to section 409A(a)(2)(B)(i)
of the Code, any payment on account of Retirement or
termination not for Cause of the Employee shall be delayed
until the sixth month anniversary of the date of separation
from employment due to Retirement or termination not for
Cause.
3. Transfer Restrictions. Unless otherwise permitted
by the Committee, this Award is non-transferable other than
by will or by the laws of descent and distribution, and may
not otherwise be assigned, pledged or hypothecated and shall
not be subject to execution, attachment or similar process.
Upon any attempt by the Employee (or the Employee's
successor in interest after the Employee's death) to effect
any such disposition, or upon any such process, the Award
may immediately become null and void, at the discretion of
the Committee.
4. Miscellaneous. This Agreement (a) shall be
binding upon and inure to the benefit of any successor of
the Corporation, (b) shall be governed by the laws of the
State of Texas and any applicable laws of the United States,
and (c) may not be amended without the written consent of
both the Corporation and the Employee. No contract or right
of employment shall be implied by this Agreement.
In the event the Employee's employment is terminated by
reason of Retirement and the Employee subsequently is
employed by a competitor of the Corporation prior to
complete payment of the Award, the Corporation reserves the
right, upon notice to the Employee, to declare the Award
forfeited and of no further validity.
In consideration of the Employee's privilege to
participate in the Plan, the Employee agrees (i) not to
disclose any trade secrets of, or other
confidential/restricted information of, American Airlines,
Inc. ("American") or its Affiliates to any unauthorized
party and (ii) not to make any unauthorized use of such
trade secrets or confidential or restricted information
during his or her employment with American or its Affiliates
or after such employment is terminated, and (iii) not to
solicit any then current employees of American or any other
Subsidiaries of the Corporation to join the Employee at his
or her new place of employment after his or her employment
with American or its Affiliates is terminated. The failure
by the Employee to abide by the foregoing obligations shall
result in the Award being forfeited in its entirety.
The Employee shall not have the right to defer payment
of the Award. Except as provided in this Agreement, the
Committee and Corporation shall not accelerate payment of
the Award.
5. Adjustments in Awards. In the event of a Stock
dividend, Stock split, merger, consolidation, re-
organization, re-capitalization or other change in the
corporate structure of the Corporation, appropriate
adjustments may be made by the Board of Directors in the
number of Units awarded.
6. Definitions. Capitalized terms not otherwise
defined in this Agreement shall have the meanings set forth
for such terms in the Corporation's 2003 Employee Stock
Incentive Plan. For purposes of Section 2(e), the term
"Change in Control" shall mean a "change in ownership" or
"change in effective control", or "change in ownership of
the assets" of the Corporation, as determined pursuant
to Internal Revenue Service Notice 2005-1 (or successor
guidance thereto under section 409A of the Code).
7. American Jobs Creation Act. Amendments to this
Agreement may be made by the Corporation, without the
Employee's consent, in order to ensure compliance with the
American Jobs Creation Act of 2004.
IN WITNESS HEREOF, the Employee and the Corporation
have executed this Performance Unit Agreement as of the day,
month and year set forth above.
EMPLOYEE AMR CORPORATION
/s/ /s/ Charles D. MarLett
Charles D. MarLett
Corporate Secretary
SCHEDULE A
2005 - 2007 PERFORMANCE UNIT PLAN
FOR OFFICERS AND KEY EMPLOYEES, AS AMENDED AND RESTATED
NOVEMBER 16, 2005
Purpose
The purpose of the 2005 - 2007 AMR Corporation Performance Unit
Plan ("Plan") for Officers and Key Employees is to provide
greater incentive to officers and key employees of the
subsidiaries and affiliates of AMR Corporation ("AMR" or "the
Corporation") to achieve the highest level of individual
performance and to meet or exceed specified goals which will
contribute to the success of the Corporation.
Definitions
For purposes of the Plan, the following definitions will control:
"Affiliate" is defined as a subsidiary of AMR or any entity that
is designated by the Committee as a participating employer under
the Plan, provided that AMR directly or indirectly owns at least
20% of the combined voting power of all classes of stock of such
entity.
"Committee" is defined as the Compensation Committee, or its
successor, of the AMR Board of Directors.
"Comparator Group" is defined as the following six U.S. based
carriers including AMR Corporation, Continental Airlines, Inc.,
Delta Air Lines, Inc., JetBlue Airways, Northwest Airlines Corp.
and Southwest Airlines Co.
"Corporate Objectives" is defined as being the objectives
established by the Committee at the beginning of each fiscal year
during the Measurement Period.
"Measurement Period" is defined as the three year period
beginning January 1, 2005 and ending December 31, 2007.
"Total Shareholder Return (TSR)" is defined as the rate of return
reflecting stock price appreciation plus reinvestment of
dividends over the Measurement Period. The average Daily Closing
Stock Price (adjusted for splits and dividends) for the three
months prior to the beginning and ending points of the
Measurement Period will be used to smooth out market
fluctuations.
"Daily Closing Stock Price" is defined as the stock price at the
close of trading (4:00 PM EST) of the National Exchange on which
the stock is traded.
"National Exchange" is defined as either the New York Stock
Exchange (NYSE), the National Association of Stock Dealers and
Quotes (NASDAQ), or the American Stock Exchange (AMEX).
Accumulation of Units
Any payment under the Plan with respect to the units will be
determined by (i) the Corporation's TSR rank within the
Comparator Group and/or (ii) the Corporation's attainment of the
Corporate Objectives during each year of the Measurement Period
and (iii) the terms and conditions of the award agreement between
the Corporation and the employee. The distribution percentage of
units pursuant to the TSR metric and based on rank, is specified
below:
Granted Shares - Percent of Target Based on Rank
Rank 6 5 4 3 2 1
Payout % 0% 50% 75% 100% 135% 175%
In the event that a carrier (or carriers) in the Comparator Group
ceases to trade on a National Exchange at any point in the
Measurement Period, the following distribution percentage of
target units, based on rank and the number of remaining
comparators, will be used accordingly.
5 Comparators
Granted Units - Percent of Target Based on Rank
Rank 5 4 3 2 1
Payout % 50% 75% 100% 135% 175%
4 Comparators
Granted Units - Percent of Target Based
on Rank
Rank 4 3 2 1
Payout % 75% 100% 135% 175%
3 Comparators
Granted Units - Percent of Target Based
on Rank
Rank 3 2 1
Payout % 100% 135% 175%
At the end of each fiscal year during the Measurement Period, the
Committee will determine whether the Corporate Objectives have
been achieved. At the end of the Measurement Period the Committee
will determine the distribution of units based upon the TSR
metric and, with respect to senior officer awards, the Corporate
Objectives. The number of units that may vest will range from 0%
to 175% of the target award.
Administration
The Committee shall have authority to administer and interpret
the Plan, establish administrative rules, approve eligible
participants, and take any other action necessary for the proper
and efficient operation of the Plan. The TSR metric will be
determined based on an audit of AMR's TSR rank by the General
Auditor of American Airlines, Inc. A summary of awards under the
Plan shall be provided to the Board of Directors at the first
regular meeting following determination of the awards. The
awards will be paid on April 30, 2008, and any such payments will
be based upon the Fair Market Value of the Corporation's Common
Stock on April 16, 2008, or such date the award is approved for
payment by the Committee.
Corporate Objectives will be used as a metric for determining the
distribution of units only for senior officers of the Corporation
(or a Subsidiary thereof) unless the Committee determines
otherwise.
General
Neither this Plan nor any action taken hereunder shall be
construed as giving any employee or participant the right to be
retained in the employ of American Airlines, Inc. or an
Affiliate.
Nothing in the Plan shall be deemed to give any employee any
right, contractually or otherwise, to participate in the Plan or
in any benefits hereunder, other than the right to receive an
award as may have been expressly awarded by the Committee subject
to the terms and conditions of the award agreement between the
Corporation and the employee.
In the event of any act of God, war, natural disaster, aircraft
grounding, revocation of operating certificate, terrorism,
strike, lockout, labor dispute, work stoppage, fire, epidemic or
quarantine restriction, act of government, critical materials
shortage, or any other act beyond the control of the Corporation,
whether similar or dissimilar, (each a "Force Majeure Event"),
which Force Majeure Event affects the Corporation or its
Subsidiaries or its Affiliates, the Committee, in its sole
discretion, may (i) terminate or (ii) suspend, delay, defer (for
such period of time as the Committee may deem necessary), or
substitute any awards due currently or in the future under the
Plan, including, but not limited to, any awards that have accrued
to the benefit of participants but have not yet been paid, in any
case to the extent permitted under proposed Treasury Regulation
1.409A-3(d) and/or 1.409A-3(e), or successor guidance thereto.
In consideration of the employee's privilege to participate in
the Plan, the employee agrees (i) not to disclose any trade
secrets of, or other confidential/restricted information of,
American Airlines, Inc. or its Affiliates to any unauthorized
party and, (ii) not to make any unauthorized use of such trade
secrets or confidential or restricted information during his or
her employment with American Airlines, Inc. or its Affiliates or
after such employment is terminated, and (iii) not to solicit any
then current employees of American Airlines, Inc. or any other
Subsidiaries of AMR to join the employee at his or her new place
of employment after his or her employment with American Airlines,
Inc. or its Affiliates is terminated. The failure by the
employee to abide by the foregoing obligations shall result in
the award being forfeited in its entirety.
The Committee may amend, suspend, or terminate the Plan at any
time.