Exhibit 10.20
SECOND AMENDMENT TO FIRST REFUSAL AGREEMENT
THIS SECOND AMENDMENT, dated as of February 29, 1996 (the
"Amendment"), amends the First Refusal Agreement, dated as of
July 12, 1994 (as previously amended, the "First Refusal
Agreement"), among UAL Corporation (the "Company"), The Air
Line Pilots Association, International ("ALPA"), The
International Association of Machinists and Aerospace Workers
("IAM") and the Salaried/Management Employee Director (as
defined in Article FIFTH, Section 1.66 of the Restated
Certificate of Incorporation of the Company (the "Restated
Certificate")) on behalf of the salaried and management
employees of United Air Lines, Inc. who are not represented by
any collective bargaining organization (the "XXX"; together
with ALPA and IAM, the "Employee Groups").
WHEREAS, the Company and the Employee Groups entered into
the First Refusal Agreement in order to effectuate the terms
and intent of the Amended and Restated Agreement and Plan of
Recapitalization, dated as of March 25, 1994 (as previously
amended, the "Recapitalization Agreement"), among the Company,
ALPA and IAM, and the Restated Certificate with respect to,
among other things, the Company's grant of a right of first
refusal to the Employee Groups in connection with certain Non-
Dilutive Issuances (as defined in Article FIFTH, Subsection
3.4(b)(vii) of the Restated Certificate);
WHEREAS, the First Refusal Agreement provides that the
issuance of Equity Securities (as defined in Article FIFTH,
Section 1.37 of the Restated Certificate) pursuant to a
transaction which would constitute an "Other Extraordinary
Matter" pursuant to Article FIFTH, Section 3.4(b) of the
Restated Certificate constitutes a Proposed Equity Issuance
under the First Refusal Agreement and is subject to the right
of first refusal of the Employee Groups;
WHEREAS, the Company proposes to issue Equity Securities
in connection with a four-for-one stock split in the form of a
stock dividend of Common Stock, $.01 par value (the "Common
Stock"), of the Company to holders of record of Common Stock
on a record date to be set by the Board of Directors of the
Company at the February 29, 1996 meeting of the Board (the
"Stock Split"); and
WHEREAS, the Company and the Employee Groups desire to
amend the First Refusal Agreement in certain respects as
hereinafter set forth so that the issuance of Equity
Securities in connection with the Stock Split is not subject
to the right of first refusal of the Employee Groups under the
First Refusal Agreement;
NOW, THEREFORE, in consideration of the foregoing
premises and for other good and valuable consideration the
receipt and sufficiency of which is hereby acknowledged, the
parties hereto agree as follows:
1. Amendments.
A. The first sentence of Section 1.A of the First
Refusal Agreement is amended to read as follows:
If, during the term of this Agreement, the Company
proposes to issue Equity Securities (as defined in
Article FIFTH, Section 1.37 of the Restated
Certificate) pursuant to a transaction which would
constitute an Other Extraordinary Matter pursuant to
Article FIFTH, Section 3.4(b) of the Restated
Certificate or would not constitute an Other
Extraordinary Matter pursuant to Article FIFTH,
Section 3.4(b)(vii)(A) or (B) of the Restated
Certificate (a "Proposed Equity Issuance"), the
Company, prior to making such Proposed Equity
Issuance, shall provide each of the Employee Groups
with a written statement of the specific terms of
such Proposed Equity Issuance (the "Proposed Sale
Notice"); provided, however, that the issuance of
Equity Securities in exchange for the Series A
Convertible Preferred Stock, without par value (the
"Series A Preferred Stock") of the Company, or upon
the conversion of any Equity Security so issued in
exchange, shall not constitute a Proposed Equity
Issuance; provided, further, that the issuance of
Equity Securities in the four-for-one stock split in
the form of a stock dividend of Common Stock, $.01
par value ("Common Stock"), on or with respect to
the Common Stock of the Company, and approved at the
February 29, 1996 meeting of the Board of Directors
of the Company (the "Stock Split"), shall not
constitute a Proposed Equity Issuance.
B. Section 1.G of the First Refusal Agreement is
amended by deleting the word "or" before clause (b)
therein and adding the following immediately before the
end thereof:
, or (c) in connection with the Stock Split.
2. Continuing Effectiveness, etc. As herein amended,
the First Refusal Agreement shall remain in full force and
effect and is hereby ratified and confirmed in all respects.
After the date hereof, all references in the First Refusal
Agreement, the Recapitalization Agreement, the Restated
Charter or any other document to "First Refusal Agreement" or
"Agreement" or similar terms shall refer to the First Refusal
Agreement as amended hereby.
3. Counterparts. This Amendment may be signed in any
number of counterparts, each of which shall be an original,
with the same effect as if the signature thereto and hereto
were upon the same instrument.
4. Governing Law. This Amendment shall be construed in
accordance with and governed by the laws of the State of
Delaware without regard to the conflicts of laws principles
thereof.
IN WITNESS WHEREOF, the parties hereto have executed this
Amendment as of the date first above written.
UAL CORPORATION
By: /s/ Xxxx X. Xxxxxxxxx
Name: Xxxx X. Xxxxxxxxx
Title: President and Chief
Operating Officer
AIR LINE PILOTS ASSOCIATION,
INTERNATIONAL
By: /s/ Xxxxxxx X. Xxxxx
Name: Xxxxxxx X. Xxxxx
Title: Chairman, UAL-MEC
INTERNATIONAL ASSOCIATION OF
MACHINISTS AND AEROSPACE WORKERS
By: /s/ Xxxxxxx X. Xxxxxx
Name: Xxxxxxx X. Xxxxxx
Title: General Vice President
/s/ Xxxxxx X. Xxxxxxxx
Xxxxxx X. Xxxxxxxx
Salaried/Management Employee
Director (not personally but as
representative of the
Salaried/Management Employees)
