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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: January 16, 2007
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
On January 16, 2007, the Compensation Committee (the
"Compensation Committee") of the Board of Directors of AMR
Corporation (the "Corporation") approved the 2007 Annual
Incentive Plan (the "AIP") for American Airlines, Inc.
("American"). All U.S. based employees of American are eligible
to participate in the AIP (including the Corporation's executive
officers). The AIP is American's annual bonus plan and provides
for the payment of awards in the event certain financial and/or
customer service metrics are satisfied, as further described in
the AIP. A copy of the AIP is attached as Exhibit 99.1.
Item 1.01 Entry into a Material Definitive Agreement
On January 16, 2007, the Compensation Committee approved the
amendment and restatement of the following compensation programs
for officers (including the Corporation's executive officers) and
certain key employees of American:
a. The 2005-2007 Performance Share Plan for Officers and Key
Employees, and the related 2005-2007 Performance Share Agreements
(collectively, the "2005-2007 Performance Share Plan"); and
b. The 2005 Deferred Share Award Agreements (the "2005 Deferred
Share Agreements").
The amendment and restatement of the 2005-2007 Performance Share
Plan will result in a distribution of cash and stock upon the
attainment of the performance criteria outlined therein. The
anticipated distribution date is April 2008.
The amendment and restatement of the 2005 Deferred Share
Agreements will result in a distribution of stock upon the
recipient being employed by a wholly owned subsidiary of the
Corporation on the vesting date. The anticipated distribution
date is July 2008.
The Compensation Committee also made certain grants to the
executive officers of the Corporation under the 2005-2007
Performance Share Plan and the 2005 Deferred Share Agreements.
These grants replaced unit grants under earlier plans.
Item 9.01 Financial Statements and Exhibits
(c) Exhibits
Exhibit 99.1 2007 Annual
Incentive Plan for American
Exhibit 99.2 2005-2007 Performance Share Plan for
Officers and Key Employees, as Amended and
Restated as of January 16, 2007
Exhibit 99.3 Form of 2005-2007 Performance Share
Agreement, as Amended and Restated as of
January 16, 2007 (with awards to executive
officers noted)
Exhibit 99.4 Form of 2005 Deferred Share Award
Agreement, as Amended and Restated as of
January 16, 2007 (with awards to executive officers noted)
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/ Kenneth W. Wimberly
Kenneth W. Wimberly
Corporate Secretary
Dated: January 17, 2007
EXHIBIT INDEX
Exhibit Description
99.1 2007 Annual Incentive Plan for American
99.2 2005-2007 Performance Share Plan for Officers and Key
Employees, as Amended and Restated as of January 16,
2007
99.3 Form of 2005-2007 Performance Share Agreement, as
Amended and Restated as of January 16, 2007 (with
awards to executive officers noted)
99.4 Form of 2005 Deferred Share Award Agreement, as Amended
and Restated as of January 16, 2007 (with awards to
executive officers noted)
Exhibit 99.1
AMERICAN AIRLINES
2007 ANNUAL INCENTIVE PLAN
Background
As part of the restructuring process that took place in
April 2003, three new broad-based variable compensation
plans were created: the Broad Based Employee Stock Option
Plan, a new Profit Sharing Plan and the Annual Incentive
Plan (the "Plan" or "AIP").
The framework for the Plan was developed during the
restructuring, but the specific plan metrics were left to
the discretion of the Board of Directors (sometimes referred
to as the "Board").
The Board has determined that for 2007 there will be two
components to the Plan - customer service and financial.
While related, the two components will be treated
separately. The financial component will provide an award
if the company meets annual financial goals. The customer
service component will provide an award if the company meets
customer satisfaction and dependability goals, regardless of
its financial performance. Providing the opportunity for a
customer service payout without meeting financial hurdles
recognizes that the company's performance in the two areas
most important to our customers - dependability and customer
satisfaction - will contribute to improved profitability.
These broad-based compensation plans have been designed to
allow all employees throughout the American Airlines team to
share in the company's success. The Plan provides the
opportunity to share immediately in that success by taking
concrete steps in each employee's everyday work that will
move the company towards profitability.
With input from our employees, the unions and the Board,
these broad-based variable compensation programs will
continue to evolve. Today, they form the building blocks
necessary to ensure that everyone is able to share in the
company's success.
Definitions
Capitalized terms not otherwise defined in the Plan will
have the meanings set forth in the 2003 Employee Stock
Incentive Plan (the "2003 Stock Plan").
"AMR" is defined as AMR Corporation.
"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.
"American" is defined as AMR less AMR subsidiaries other
than American Airlines, Inc. and its subsidiaries.
"American Airlines" is defined as American Airlines, Inc.
"American's Pre-Tax Earnings Margin" is a percentage and is
defined as American's earnings, relative to its revenues,
before any applicable income tax expense and is exclusive of
any profit sharing payments, payments under the Plan and any
special, extraordinary or one-time items as may be
determined by the Committee in its discretion, after
consultation with AMR's independent auditors.
"Committee" is defined as the Compensation Committee of the
AMR Board of Directors.
"Competitor" is defined as one of AirTran Airways, Alaska
Airlines, Continental Airlines, Delta Air Lines, JetBlue
Airways, Northwest Airlines, Southwest Airlines, United Air
Lines and US Airways. During the Plan year, the Committee
delegates to the Incentive Compensation Committee the
authority to modify the universe of companies that comprise
the definition of "Competitor".
"Disabled", "Disability" or variants thereof will have the
meaning as defined in section 409(a)(2)(C) of the Internal
Revenue Code of 1986, as amended (the "Code").
"DOT Rank" is defined as American's relative rank with
respect to the Competitors in the category of "arrivals+14
(A+14)" as determined by the U.S. Department of
Transportation (DOT). This monthly ranking is based on
DOT's aggregated A+14 data for the period January 1, 2007
through December 31, 2007 inclusive. To the extent that at
any point during the year a Competitor ceases to report A+14
data, it will be excluded from the calculation for the month
in which it ceases to report A+14 data, and for future
months, until it begins to report A+14 data for a full
month.
"Eligible Earnings" is defined by the nature of the work
group. For employees who are represented by a union, the
definition of Eligible Earnings will be the definition
contained in the Letter of Agreement between the union and
the company. For employees who are not represented by a
union the definition of Eligible Earnings will be identical
to the term "Qualified Earnings" under the 2003 American
Airlines Employee Profit Sharing Plan.
"Fund" is defined as the fund, if any, accumulated in
accordance with this Plan.
"Letters of Agreement" is defined as the agreements reached
with the Allied Pilots Association, Association of
Professional Flight Attendants and the Transport Workers
Union during the April 2003 restructuring process that
define the framework of the Plan.
"Measure" is defined, as appropriate, as American's Pre-Tax
Earnings Margin, DOT Rank or Survey America Rank.
"Named Executive Officers" is defined as the officers of
American who are named in the AMR proxy statement that
reports income for the year in which awards under the Plan
are earned.
"Other Cash Compensation Programs" is defined as cash
payments to management employees that are not predicated
upon the criteria and thresholds contained in the Plan. Per
discussions and as specified in the Letters of Agreement,
this term does not include salary, stock-based compensation,
severance, retirement benefits or deferred payments of base
compensation, or eligible cash bonuses from prior years.
"Profit Sharing Plan" is defined as the 2007 Employee
Profit Sharing Plan.
"Survey America Rank" is defined as American's relative rank
with respect to its Competitors in the category of "Overall
Travel Experience", using a blended ranking of first class
and coach cabin, as reported in Plog Inc.'s Survey America.
The Survey America ranking is based on monthly data for
American and the Competitors for the period January 1, 2007
through December 31, 2007, inclusive. To the extent that at
any point during such year a Competitor ceases to
participate, it will be excluded from the calculation for
the month in which it ceased to participate, and for future
months, until it begins to participate again for a full
month period.
"Target Award" is defined as the award (stated as a
percentage of Eligible Earnings) for an eligible participant
when target level is achieved on the financial measure. The
Target Award is determined by the employee's job level.
Plan Measures
As outlined earlier, the Plan is comprised of two
components: customer service and financial.
Customer Service Component
The customer service component of the Plan will include two
performance metrics - customer satisfaction and
dependability. The Plan will reward employees if American
achieves at least one of the two metrics.
The customer satisfaction metric will be based on American's
Survey America Rank. The dependability metric will be based
on American's DOT Rank.
Monthly awards will be based on the higher of the monthly
rankings for DOT Rank or for Survey America Rank, as per the
payout schedule below. These award levels are the same for
all employees regardless of full-time or part-time status or
job level.
Payout
Per Person
Monthly Rank Per Month
First $100
Second - Third $ 50
Fourth - Fifth $ 25
If both metrics are achieved in any single month, the awards
will not be additive. Awards will be based solely on the
higher ranking of the two metrics.
Awards under the customer service component will be paid
regardless of performance under the financial component.
The awards under the customer service component will be
paid, net of applicable taxes, within 75 days after DOT Rank
and Survey America Rank are available and employee
eligibility is established...
For example:
Monthly Ranking Higher
Survey Rank
America DOT Achieved Payout
January 2 7 2 2nd place = $ 50
February 4 5 4 4th place = $ 25
March 3 1 1 1st place = $100
Quarterly Payout $175
Financial Component
The financial component of the Plan will be based upon
American's Pre-Tax Earnings Margin for the full-year 2007.
The measure has a threshold (performance below this level
earns no award), a target and a maximum as reflected below:
American's Pre-Tax
Earnings Margin
Threshold 5%
Target 10%
Maximum 15%
For non-management, support staff and management levels 1-4,
awards under the financial component, in combination with
the customer service awards, will provide total annual Plan
payouts ranging from 2.5% of Eligible Earnings at threshold,
5% of Eligible Earnings at target and 10% of Eligible
Earnings at Maximum. Award levels have a linear progression
as American's Pre-Tax Earnings Margin increases between the
threshold and target levels, and between the target and
maximum levels.
American's Pre-Tax Award as a % of
Earnings Margin Eligible Earnings
Threshold 5% 2.5%
Target 10% 5.0%
Maximum 15% 10.0%
For management Levels 5 and above, none of whom participate
in the Profit Sharing Plan; the Plan is the successor to the
traditional Incentive Compensation Plan. As in the past,
the awards for employees at Level 5 and above will be
determined by the senior management of AMR or, in certain
instances, by the Board; will vary by level; and will be
based on an assessment of individual performance.
If the company does not achieve the threshold level of
American's Pre-Tax Earnings Margin, there will be no
financial performance payout. However, a participant retains
any awards earned in 2007 for customer service performance.
When the threshold level of American's Pre-Tax Earnings
Margin is met, participants may be entitled to a payment
under the Plan (refer to the example below). In this case,
any customer service awards earned during 2007 act as a
"deposit" against the amount to be awarded pursuant to the
financial component. The amount of the financial
performance payout a participant receives will be the
difference, if any, between what is earned under the
financial performance formula and what has already been
earned through the customer service awards (net of
applicable taxes).
For example (an individual employee's sample annual payout):
Customer Service
1 month ~ 1st Place 1 x $100 = $100
3 months ~ 2nd - 3rd Place 3 x $50 = $150
8 months ~ 4th - 5th Place 8 x $25 = $200
Customer Service Payout $450
Financial ~ achieve 5% American's pre-tax earnings threshold
and have $40,000 in Eligible Earnings
2.5% x $40,000 = $1,000
less Customer Service payout ($450)
Financial Payout $550
Total Annual payout is $1,000 ($450 + $550), or 2.5% of
Eligible Earnings (net of applicable taxes).
The AIP Letters of Agreement provide that Other Cash
Compensation Programs for management employees may be no
more than 20% of the maximum possible award that was or
could have been earned by the individual management employee
under the Plan formula (the "20% Limitation"). Any payment
under the 20% Limitation shall be made by March 15, 2008.
The Board has established a program that, based on an
individual's performance, anticipates payouts to Level 5 and
above management employees up to the 20% Limitation. (Level
5 and above employees are not eligible for the Profit
Sharing Plan) This program is designed to commence payments
at $500 million in American's pre-tax earnings, the same
financial threshold as exists in the Profit Sharing Plan.
This is consistent with the company's past practice of
restricting payouts under any management incentive
compensation program until payouts occur under the
corresponding employee Profit Sharing Plan. Payouts under
this program will cease when the financial threshold under
the Plan (a 5% Pre-Tax Earnings Margin for American) is
achieved. Any payment under the program described in this
paragraph shall be made by March 15, 2008.
Although the Board has determined that a program to use the
flexibility provided for in the Letters of Agreement will
not commence until reaching a threshold of $500 million in
American's pre-tax earnings and will be discontinued when
the financial threshold of the Plan is achieved, the company
also retains the ability to make a payment to an individual
under the 20% Limitation as provided for in the Letters of
Agreement.
The Letters of Agreement and related discussions specify
that for purposes of the 20% Limitation, Other Cash
Compensation Programs does not include salary, stock-based
compensation, severance, retirement benefits or deferred
payments of base compensation, or eligible cash bonuses from
prior years.
Eligibility for Participation
Customer Service Component:
To earn an award under the customer service component of the
Plan, an individual must have been employed as a regular
full-time or part-time employee at American, in a
participating workgroup (employees in the United States,
Puerto Rico and the U.S. Virgin Islands) during the
applicable month to be eligible to participate in the Plan.
The Committee, at its discretion, may permit participation
by employees of Affiliates who have been so employed by the
Affiliate since the first day in the applicable month, if
they become employed by American during the applicable month
during 2007.
In addition to the terms listed above, in order for full-
time and part-time employees to earn a payout under the
customer service measure, an individual cannot be on any
type of leave during the applicable month, except approved
FMLA, injury on duty, military, overage or time-card leave,
as provided for under the company's policies, collective
bargaining agreement or state law as applicable.
Moreover, an individual will not be eligible to earn a
customer service award if such individual is, at the same
time, eligible to participate in:
i) any incentive compensation, profit sharing,
commission or other bonus plan sponsored by an
Affiliate of American
ii) any commission or bonus plan, with the exception of
American's Profit Sharing Plan or provisions of the Annual
Incentive Plan, sponsored by American, any division of
American or any Affiliate of American
In order to earn a customer service award under the Plan, an
individual must satisfy the aforementioned eligibility
requirements and must be an employee of American or an
Affiliate at the time an award under the Plan is paid. If
at the time awards are paid under the Plan, an individual
has retired from American or an Affiliate, has been laid
off, is on leave of absence with reinstatement rights, is
Disabled, or has died, the award which the individual
otherwise would have received under the Plan but for such
retirement, lay-off, leave, Disability, or death will be
paid (on a pro rata basis) to the individual, or his/her
estate in the event of death.
The percentage of the payout that an individual receives for
any given month will be determined based upon the percentage
of his/her schedule that the individual fulfills in that
month. For Plan purposes, an individual will be considered
to have fulfilled his/her schedule if he/she actually works
at least 50% of his/her scheduled time (50% of monthly
guarantee hours for flight crew) or takes a scheduled
vacation or time-card leave, which, together with his/her
actual work time, amounts to at least 50% of his/her
scheduled time for the month. If an individual does not
fulfill his scheduled time due to one of the aforementioned
leaves, his award will be pro rated based on actual hours
worked in that month (vis-a-vis hours scheduled in that
month); otherwise, no payment will be made.
Financial Component
To earn an award under the financial component of the Plan,
an individual must have been employed as a regular full-time
or part-time employee at American, in a participating
workgroup (employees in the United States, Puerto Rico and
the U.S. Virgin Islands) during 2007 to be eligible to
participate in the Plan.
The Committee, at its discretion, may permit participation
by employees of Affiliates who have been so employed by the
Affiliate during the Plan year, if they become employed by
American during the Plan year. In such instances, only
eligible earnings at American will be included in the payout
calculation.
Notwithstanding the forgoing, however, an individual will
not be eligible to participate in the Plan if such
individual is, at the same time, eligible to participate in:
i) any incentive compensation, profit sharing, commission
or other bonus plan sponsored by an Affiliate of American
ii) any commission or bonus plan, with the exception of
American's Employee Profit Sharing Plan or provisions of the
Annual Incentive Plan, sponsored by American, any division
of American or any Affiliate of American
In order to earn an award under the financial component of
the Plan, an individual must satisfy the aforementioned
eligibility requirements and must be an employee of American
or an Affiliate at the time such financial award under the
Plan is paid. If at the time such awards are paid under the
Plan, an individual has retired from American or an
Affiliate, has been laid off, is on leave of absence with
reinstatement rights, is Disabled, or has died, the award
which the individual otherwise would have received under the
Plan but for such retirement, lay-off, leave, Disability, or
death may be paid (on a pro rata basis) to the individual,
or his/her estate in the event of death, at the discretion
of the Committee.
Allocation of Individual Awards
The Committee, in consultation with the Chairman, President
and CEO of American, will approve awards for officers of
American, including the Named Executive Officers. The award
for an officer will be equal to an amount calculated in
accordance with this Plan, as adjusted for individual
performance. Provided, however, that the sum of all awards
made to officers may not exceed the sum of officer awards as
calculated in accordance with this Plan. Awards for the
Named Executive Officers will be equal to the award earned
under the financial component of the Plan. An award under
the Plan to an officer may not exceed the amount set forth
in Section 11 of the 1998 Long Term Incentive Plan, as
amended.
The Chairman, President and CEO of American, in consultation
with the executive and senior vice presidents of American,
will approve awards for non-officer eligible employees
(Level 5 and above). An award for a non-officer will be
equal to an amount calculated in accordance with this Plan,
as adjusted for individual performance. Provided, however,
that the sum of all awards made to non-officers may not
exceed the sum of non-officer awards calculated in
accordance with this Plan.
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,
consistent with the Letters of Agreement reached with each
of the unions. The amount, if any, of the Fund shall be
audited by the General Auditor of American based on a
certification of American's Pre-Tax Earnings Margin by AMR's
independent auditors. For the Financial Measure, a summary
of awards under the Plan shall be provided to the Committee
at the first regular meeting following determination of the
awards. To the extent a Measure is no longer compiled by
the DOT or Survey America as applicable, during a Plan year,
the Committee will substitute a comparable performance
measure for the remainder of the Plan year.
Method of Payment
The Committee will determine the method of payment of
awards. The financial awards shall be paid (net of
applicable taxes) as soon as practicable after audited
financial statements for the year 2007 are available, but no
later than March 15, 2008. The customer service measure is
paid independently of the financial measure. The customer
service award will be paid (net applicable taxes) quarterly
within 75 days after the DOT Rank and Survey America Rank
are available and employee eligibility is established.
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 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 payment of such incentive compensation as may have
been expressly awarded by the Committee.
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 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 AMR 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 employee shall not have the right to defer any payment
under the Plan. The Committee and American Airlines shall
not accelerate any payment under the plan.
Notwithstanding any provision to the contrary, if an
employee is a person subject to section 409(a)(2)(B)(i) of
the Code, any payment under the Plan due to Retirement or
termination of employment for reasons other than Death or
Disability shall be delayed until the sixth month
anniversary of the date of the separation from employment
due to Retirement or termination for Cause.
Exhibit 99.2
2005 - 2007 PERFORMANCE SHARE PLAN
FOR OFFICERS AND KEY EMPLOYEES, AS AMENDED AND RESTATED
AS OF JANUARY 16, 2007
Purpose
The purpose of the 2005 - 2007 AMR Corporation
Performance Share Plan for Officers and Key Employees, as
amended and restated as of January 16, 2007 ("Plan") 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
during the time frame 2005 to 2007, 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: 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 Award
Any distribution under the Plan 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 a target award 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 award, based on rank and
the number of remaining comparators, will be used
accordingly.
5 Comparators
Granted Shares - Percent of Target Based on Rank
Rank 5 4 3 2 1
Payout% 50% 75% 100% 135% 175%
4 Comparators
Granted Shares - Percent of Target Based
on Rank
Rank 4 3 2 1
Payout% 75% 100% 135% 175%
3 Comparators
Granted Shares - 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 an
award based upon the TSR metric and, with respect to senior
officer awards, the Corporate Objectives. The number of
shares 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. 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. Awards, if any, will be
distributed on or about April 17, 2008, or such date in 2008
the award is approved for distribution by the Committee.
The distribution of any shares under this Plan is
subject to the Corporation having sufficient stock in a
stock plan to make such a distribution. In the event the
Corporation does not have sufficient shares of stock in such
a stock plan for the distribution contemplated by this Plan,
the Committee will have the authority and discretion to make
substitutions for such shares, all to the effect that the
Employee will receive cash or other marketable property of a
value equivalent to what the Employee would have received in
a stock distribution.
Corporate Objectives will be used as a metric for
determining the distribution of awards 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 99.3
2005 - 2007 PERFORMANCE SHARE AGREEMENT
AS AMENDED AND RESTATED AS OF JANUARY 16, 2007
This 2005/2007 Performance Share Agreement
("Agreement") is amended and restated as of January 16,
2007, by and between AMR Corporation, a Delaware corporation
(the "Corporation"), and an officer or key employee of one
of the Corporation's Subsidiaries (the "Employee" or the
"Recipient") as identified in the notification sent the
Employee described below (the "Notification").
WHEREAS, pursuant to the 2005/2007 Performance Share
Plan for Officers and Key Employees, as amended and restated
as of January 16, 2007 (the "Plan") and as adopted by the
Board of Directors of the Corporation (the "Board"), the
Compensation Committee of the Board (the "Committee") has
determined to make an award (the "Award", as set forth in
the Notification) to the Employee (subject to the terms of
the Plan and this Agreement), as an inducement for the
Employee to remain an employee of one of the Corporation's
Subsidiaries during the time frame of 2005-2007 and to
retain and motivate such Employee during such employment.
This Agreement sets forth the terms and conditions
attendant to the Award under the Plan.
1. Grant of Award. Subject to the terms and
conditions of this Agreement, the Recipient is hereby
granted an Award as of the grant date set forth in the
Notification. The Award shall vest, if at all, in
accordance with Section 2 of this Agreement. On the date
the Award vests (if at all), the Recipient will receive a
combination of cash and the Corporation's Common Stock. The
Committee will determine the amount of the Award to be
distributed in cash, if any (the "Cash Award") and the
amount of the Award to be settled in shares of the
Corporation's Common Stock (the "Stock Distribution"). The
Cash Award will be distributed on April 30, 2008 (such Cash
Award will be made pursuant to the Annual Incentive Plan).
The Stock Distribution will occur on or about April 17, 2008
(such Stock Distribution will be made from and pursuant to
the AMR Corporation 1998 Long Term Incentive Plan, as
amended (the "LTIP")). The sum of the Cash Award and the
Stock Distribution will equal the product of (a) the Fair
Market Value of the Common Stock on April 16, 2008, and (b)
the number of shares of Common Stock comprising the Award.
2. Vesting.
(a) The Award will vest, if at all, in accordance with
Schedule A, attached hereto and made part of this Agreement.
(b) In the event Employee's employment with one of the
Corporation's Subsidiaries 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 (subject to the second paragraph of Section 4) or
termination not for Cause (each an "Early Termination"), the
Award will vest, if at all, on a pro-rata basis and will be
distributed 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 distributed to the Employee at
the same time as Cash Awards and Stock Distributions are
made to then current employees who have Awards under the
Plan, subject to Section 2(f) of this Agreement.
(c) In the event the Employee's employment with one of
the Corporation's Subsidiaries is terminated for Cause, or
if the Employee terminates his/her employment with such
Subsidiary, each occurring prior to April 16, 2008, the
Award shall be forfeited in its entirety.
(d) If prior to April 16, 2008 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 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 7.
(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 Employee (or the Employee's successor in interest
after the Employee's death) to effect any such disposition,
or upon the commencement 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. Notwithstanding the
foregoing, this Agreement may be amended from time to time
without the written consent of the Employee pursuant to
Section 8 below and as permitted by the Plan (or its
successor). 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
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 will not have the right to defer any of
the Cash Award or the Stock Distribution. Except as
provided in this Agreement, the Committee and Corporation
will not accelerate the Cash Award or the Stock
Distribution.
Any Cash Award will be net of applicable withholding
and social security taxes. The Employee will pay to the
Corporation timely any and all such taxes on account of the
Stock Distribution. The failure by the Employee to pay
timely such taxes will result in a withholding from any and
all payments from the Corporation or any Subsidiary to the
Employee in order to satisfy such taxes.
Notwithstanding anything in this Agreement to the
contrary, the Committee may elect, at any time and from time
to time, in lieu of issuing all or any portion of the stock
comprising the Stock Distribution, to make substitutions for
such stock, all to the effect that the employee will receive
cash or other marketable property of a value equivalent to
what the Employee would have received in a stock
distribution.
5. [Intentionally omitted]
6. 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 shall be made by the Board of Directors in the
Award.
7. Incorporation of LTIP Provisions. Capitalized
terms not otherwise defined herein (inclusive of Schedule A)
shall have the meanings set forth for such terms in the
LTIP. 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).
8. 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.
9. Prior 2005/2007 Performance Unit Agreement. In
consideration of this amended and restated Agreement, the
Employee irrevocably agrees that any prior award granted to
the Employee under the 2005/2007 Performance Unit Plan, as
hereby amended and restated, is hereby forfeited in its
entirety and will hereafter be of no further effect and such
prior award is replaced in its entirety with the Award
granted under this Agreement.
IN WITNESS HEREOF, the Employee and the Corporation
have executed this Performance Share Agreement as of the
day, month and year set forth above.
EMPLOYEE AMR CORPORATION
_____________________________
Kenneth W. Wimberly
Corporate Secretary
Name of Executive Number of 2005/2007 Performance
Shares Granted
G.J.Arpey 140,000
T.W.Horton 77,600
D. P. Garton 77,600
G.F. Kennedy 57,000
R.W. Reding 57,000
SCHEDULE A
2005 - 2007 PERFORMANCE SHARE PLAN
FOR OFFICERS AND KEY EMPLOYEES, AS AMENDED AND RESTATED
AS OF JANUARY 16, 2007
Purpose
The purpose of the 2005 - 2007 AMR Corporation
Performance Share Plan for Officers and Key Employees, as
amended and restated as of January 16, 2007 ("Plan") 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
during the time frame 2005 to 2007, 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: 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 Award
Any distribution under the Plan 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 a target award 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 award, based on rank and
the number of remaining comparators, will be used
accordingly.
5 Comparators
Granted Shares - Percent of Target Based on Rank
Rank 5 4 3 2 1
Payout% 50% 75% 100% 135% 175%
4 Comparators
Granted Shares - Percent of Target Based
on Rank
Rank 4 3 2 1
Payout% 75% 100% 135% 175%
3 Comparators
Granted Shares - 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 an
award based upon the TSR metric and, with respect to senior
officer awards, the Corporate Objectives. The number of
shares 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. 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. Awards, if any, will be
distributed on or about April 17, 2008, or such date in 2008
the award is approved for distribution by the Committee.
The distribution of any shares under this Plan is
subject to the Corporation having sufficient stock in a
stock plan to make such a distribution. In the event the
Corporation does not have sufficient shares of stock in such
a stock plan for the distribution contemplated by this Plan,
the Committee will have the authority and discretion to make
substitutions for such shares, all to the effect that the
Employee will receive cash or other marketable property of a
value equivalent to what the Employee would have received in
a stock distribution.
Corporate Objectives will be used as a metric for
determining the distribution of awards 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 99.4
DEFERRED SHARE AWARD AGREEMENT,
AS AMENDED AND RESTATED AS OF JANUARY 16, 2007
This Deferred Share Award Agreement (the "Agreement")
is amended and restated as of January 16, 2007, by and
between AMR Corporation, a Delaware corporation (the
"Corporation"), and an officer or key employee of one of the
Corporation's Subsidiaries (the "Employee") as identified in
the notification sent to the Employee described below (the
"Notification").
WHEREAS, pursuant to the AMR Corporation 1998 Long Term
Incentive Plan, as amended (the "LTIP"), the Compensation
Committee of the Board of Directors (the "Committee") has
determined that the Employee is an officer or key employee
and has further determined to make an award of deferred
shares from and pursuant to the LTIP to the Employee as an
inducement for the Employee to remain with one of the
Corporation's Subsidiaries and to motivate the Employee
during such employment.
NOW, THEREFORE, the Corporation and the Employee hereby
agree as follows:
1. Grant of Award.
The Employee is hereby granted effective as of the
grant date set forth in the Notification (the "Grant Date")
a deferred share award (the "Award"), subject to the terms
and conditions of this Agreement, as amended and restated,
with respect to the number of shares of Common Stock set
forth in the Notification (the "Shares"). Subject to the
terms and conditions of this Agreement, the Shares covered
by the Award will vest, if at all, in accordance with
Section 2 hereof, on July 25, 2008 (such date hereby
established as the "Vesting Date" of the Award).
2. Distribution of Award.
Distribution with respect to the Award, on the Vesting
Date, will occur, if at all, in accordance with the
following terms and conditions:
(a) If the Employee is on the payroll of a Subsidiary
that is wholly owned by the Corporation as of the Vesting
Date, the Shares will be distributed to the Employee on or
about July 25, 2008.
(b) In the event the Employee's employment with a
Subsidiary of the Corporation is terminated prior to the
Vesting Date 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
Shares covered by the Award will vest on a pro-rata basis
and will be distributed to the Employee (or, in the event of
the Employee's death, the Employee's designated beneficiary
for the 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 the Grant Date through the month of Early Termination,
inclusive. The pro-rata Award will be distributed (subject
to Section 2(e) hereof) to the Employee (or, in the event of
the Employee's death, the Employee's designated beneficiary
for the purposes of the Award, or in the absence of an
effective beneficiary designation, the Employee's estate) at
the same time as Awards are made to then current employees
who have Awards under the Plan, subject to Section 2(e) of
this Agreement.
(c) In the event of a Change in Control of the
Corporation (as defined in Section 5 hereof) after the
Vesting Date but prior to the distribution of the Award, the
Award will be distributed in accordance with the terms of
the LTIP.
(d) Notwithstanding the terms of Section 2(a), 2(b) or
2(c), the Award will be forfeited in its entirety if prior
to the Vesting Date:
(i) The Employee's employment with a Subsidiary
of the Corporation is terminated for Cause,
or if the Employee terminates his/her
employment with a Subsidiary of the
Corporation;
(ii) The Employee becomes an employee of a
Subsidiary that is not wholly owned by the
Corporation; or
(iii) The Employee takes a leave of absence without
reinstatement rights, unless otherwise agreed in writing
between the Corporation (or a Subsidiary or Affiliate
thereof) and the Employee.
(e) 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 the
Employee's 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 be assigned, pledged
or hypothecated and will not be subject to execution,
attachment or similar process. Upon any attempt by the
Employee (or the Employee's successor in the interest after
the Employee's death) to effect any such disposition, or
upon the commencement of any such process, the Award may
immediately become null and void, at the discretion of the
Committee.
4. [Intentionally omitted]
5. Miscellaneous.
This Agreement (a) will be binding upon and inure to
the benefit of any successor of the Corporation, (b) will 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. Notwithstanding the foregoing, this
Agreement may be amended from time to time without the
written consent of the Employee pursuant to Section 8 below
and as permitted by the LTIP (or its successor). No
contract or right of employment will 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 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 immediately forfeited in its
entirety.
For purposes of Section 2(c) hereof, the term "Change
in Control" will 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).
The Employee shall not have the right to defer
distribution of the Award. Except as provided in this
Agreement, the Committee and Corporation will not accelerate
distribution of the Award.
Notwithstanding anything in this Agreement to the
contrary, the Committee may elect, at any time and from time
to time, in lieu of issuing all or any portion of the
Shares, to make substitutions for such Shares, all to the
effect that the employee will receive cash or other
marketable property of a value equivalent to what the
Employee would have received in a stock distribution.
Capitalized terms not otherwise defined herein shall
have the meanings set forth for such terms in the LTIP.
6. 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 shall be made by the Committee in
the number of Shares awarded.
7. Prior Deferred Unit Awards.
In consideration of this amended and restated
Agreement, the Employee irrevocably agrees that any prior
award granted to the Employee under a 2005 Deferred Unit
Agreement, as hereby amended and restated, is hereby
forfeited in its entirety and will hereafter be of no
further effect and such prior award is replaced in its
entirety with the Award granted under this Agreement.
8. American Jobs Creation Act.
In addition to amendments permitted by Section 5 above,
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 Agreement as of the day and year first
above written.
Employee AMR CORPORATION
______________________________ __________________________
Kenneth W. Wimberly
Corporate Secretary
Name of Executive Number of 2005 Deferred
Shares Granted
G.J. Arpey 24,000
D. P. Garton 16,500
G.F. Kennedy 10,000
R.W. Reding 10,000