AMENDMENT TO CAREER EQUITY PROGRAM DEFERRED STOCK AWARD AGREEMENT(S)
AMENDMENT
TO
CAREER
EQUITY PROGRAM
DEFERRED STOCK AWARD
AGREEMENT(S)
This Amendment (the “Amendment”) to the
Career Equity Program Deferred Stock Award Agreement(s) dated [INSERT DATE(S)] (as amended,
the “Agreement(s)”) is made this 17th day of November, 2008.
WHEREAS, AMR Corporation (the
“Corporation”) and [NAME] (the “Employee”),
employee number [EMPLOYEE
NUMBER], have previously entered into the Agreement(s);
WHEREAS, effective January 1, 2005, the
Agreement(s) became subject to certain requirements of section 409A of the
Internal Revenue Code of 1986, as amended (the “Code”) and the regulations and
other guidance issued thereunder;
WHEREAS, pursuant to guidance issued
under section 409A of the Code, the Agreement(s) may be amended on or before
December 31, 2008, to comply with the requirements of section 409A of the Code
and the regulations and other guidance issued thereunder;
WHEREAS, the Corporation and the
Employee wish to amend such Agreement(s) to comply with the applicable
requirements of section 409A of the Code and the governing regulations and other
guidance issued thereunder;
NOW THEREFORE, in order to avoid
imposition of the penalties under section 409A of the Code, the Agreement(s) are
hereby amended as follows:
1. The
last sentence in the Section of the Agreement(s) entitled, “Grant of Award”, is
deleted in its entirety and substituted in its place is the
following:
“To the
extent the shares of Stock covered by the Award are not vested (within the
meaning of section 409A of the Internal Revenue Code of 1986, as amended (the
“Code”)) as of January 1, 2005 (“Post-409A Shares”), the vesting, payment and
deferral of such Post-409A Shares shall be made in accordance with the
provisions herein which specifically relate to Post-409A Shares. Such
Post-409A Shares shall be comprised of the shares of Stock which the Employee
could not receive pursuant to the vesting schedule described herein by virtue of
a Normal Retirement or Early Retirement effective as of December 31,
2004. For instance, if the Employee had attained age 57 as of
December 31, 2004, and could have retired (by virtue of an Early Retirement) at
that time, 9% of the shares of Stock covered by the Award would be treated as
Post-409A Shares. Except as otherwise provided in the Section of the
Agreements entitled, “Vesting – Change in
Control”, to the extent the shares of Stock covered by the Award are not
Post-409A Shares, the vesting, payment and deferral of such shares shall be made
in accordance with the applicable provisions herein, which do not otherwise
relate specifically to Post-409A Shares.”
2. The
following new paragraph is added at the end of the Section of the Agreement(s)
entitled, “Vesting
–Normal Retirement or Early Retirement”, to read as follows:
“The
portion of the Employee’s Award comprised of Post-409A Shares shall become
vested in accordance with the provisions of the preceding paragraphs of this
Section; provided that the Employee’s Retirement or Early Retirement constitutes
a “separation from service” for purposes of Treasury Regulation 1.409A-1(h) or
successor guidance thereto. Except as provided in the Section of the
Agreement entitled, “Section 409A
Compliance”, share certificates for the vested portion of the Employee’s
Award comprised of Post-409A Shares shall be issued and delivered to the
Employee not later than the 15th day of the third month of the calendar year
immediately following the calendar year in which the Employee’s Retirement or
Early Retirement occurred.”
3. The
following new paragraph is added at the end of the Section of the Agreement(s)
entitled, “Vesting –
Death or Disability”, to read as follows:
“The
portion of the Employee’s Award comprised of Post-409A Shares shall become
vested in accordance with the provisions of the preceding paragraph of this
Section; provided that, with respect to the issuance and delivery of Post-409A
Shares upon the termination of Employee’s employment due to Disability, such
termination of employment constitutes a “separation from service” for purposes
of Treasury Regulation 1.409A-1(h) or successor guidance
thereto. Except as provided in the Section of the Agreement entitled,
“Section 409A
Compliance”, share certificates for the vested portion of the Employee’s
Award comprised of Post-409A Shares, which are payable upon the termination of
Employee’s employment due to Disability, shall be issued and delivered not later
than the 15th day of the third month of the calendar year immediately following
the calendar year in which such termination occurred.”
4. The
following new paragraph is added at the end of the Section of the Agreement(s)
entitled, “Vesting –
Termination Not for Cause”, to read as follows:
“The
portion of the Employee’s Award comprised of Post-409A Shares shall become
vested in accordance with the provisions of the preceding paragraph of this
Section; provided that, with respect to the issuance and delivery of Post-409A
Shares upon the termination of Employee’s employment for reasons described in
this Section, the Employee’s termination of employment constitutes a “separation
from service” for purposes of Treasury Regulation 1.409A-1(h) or successor
guidance thereto. Except as provided in the Section of the Agreement
entitled, “Section
409A Compliance”, share certificates for the vested portion of the
Employee’s Award comprised of Post-409A Shares shall be issued and delivered to
the Employee in accordance with the preceding paragraph of this
Section.”
5. The
Section of the Agreement(s) entitled, “Vesting – Change in
Control”, is deleted in its entirety and substituted in its place is the
following:
“Vesting – Change in
Control. In the event of a “Change in Control” (as defined in
the Corporation’s 1998 Long Term Incentive Plan, as amended, that is in effect
as of December 31, 2008, and any successor thereto), shares under the Award
(i.e., all Post-409A
Shares and non-Post-409A Shares) shall vest in accordance with the 1998 Plan or
its successor. Share certificates for the number of shares covered by
the vested portion of the Employee’s Award comprised of Post-409A Shares shall
be issued and delivered to the Employee not later than the 15th day of the third
month of the calendar year immediately following the calendar year in which such
change in control occurred.”
6. The
following new paragraph is added at the end of the Section of the Agreement(s)
entitled, “Elective
Deferrals”, to read as follows:
“Notwithstanding
the foregoing, the Employee will not be permitted to make any change in the time
of payment of the portion of the Employee’s Award comprised of Post-409A
Shares.”
7. The
following new paragraph is added at the end of the first paragraph in the
Subsection of the Agreement(s) entitled, “Performance Return
Payments”, to read as follows:
“Notwithstanding
the foregoing, for ROI measurement periods ending on or after January 1, 2005,
the Payment Date for a particular Performance Return Payment shall occur during
the calendar year immediately following the close of the last fiscal year of the
particular ROI measurement period that relates to such Performance Return
Payment.”
8. The
following new paragraph is added at the end of the last paragraph in the
Subsection of the Agreement(s) entitled, “Performance Return
Payments”, to read as follows:
“Notwithstanding
the foregoing, the Employee may not elect to defer receipt of a Performance
Return Payment that relates to a ROI measurement period ending on or after
January 1, 2005.”
9. The
following new paragraph is added at the end of the Subsection of the
Agreement(s) entitled, “Dividend
Equivalents”, to read as follows:
“Notwithstanding
the foregoing, dividend equivalent payments occurring on or after January 1,
2005, shall automatically be deferred and treated as additional shares of
Deferred Stock, subject to the terms and conditions that apply to the related
shares of Deferred Stock with respect to which such dividend equivalents were
originally payable.”
10. The
following new Section is added as the last Section of the Agreement(s) to read
as follows:
“Section 409A
Compliance. The Agreement, as amended, is intended to be
exempt from and/or comply with the requirements (and not otherwise be subject to
the interest and penalty taxes of) section 409A of the Code and the regulations
and other guidance issued thereunder, and shall be interpreted in a manner
consistent with that intent. Notwithstanding the foregoing, in the
event there is a failure to comply with section 409A of the Code, the Board
shall have the discretion to accelerate the issuance and delivery of Post-409A
Shares, but only to the extent of the amount required to be included in income
as a result of such failure. Amendments to the Agreement may be made
by the Corporation, without the Employee’s consent, in order to ensure
compliance with section 409A of the Code and the regulations and other guidance
issued thereunder.
Notwithstanding
any provision herein to the contrary, if the Employee is a “specified employee”
pursuant to Treasury Regulation 1.409A-1(i) or successor guidance thereto, any
payment of Post-409A Shares on account of his/her Normal Retirement, Early
Retirement or involuntary termination not for Cause shall be delayed until the
earlier of: (i) the six-month anniversary of the date of separation from
employment due to Normal Retirement, Early Retirement or involuntary termination
not for Cause, or (ii) the date of the Employee’s death.”
11. The
following new sentence is added at the end of the first paragraph of Schedule A
of the Agreement(s) to read as follows:
“Notwithstanding
the foregoing, effective October 3, 2004, the Chairman or Committee, as the case
may be, only shall change such percentage prior to the commencement of a
particular ROI measurement period and such change shall apply on a prospective
basis to such ROI measurement period and other ROI measurement periods
commencing thereafter.”
12. The
first sentence of the second paragraph of Schedule A of the Agreement(s) is
amended by deleting said sentence in its entirety and substituted in its place
is the following:
“Notwithstanding
the foregoing, effective January 1, 2005, the price of the shares described in
this paragraph will be equal to the “Fair Market Value” (as defined in the
Corporation’s 1998 Long Term Incentive Plan, as amended, that is in effect as of
December 31, 2008, and any successor thereto) of the Stock as of the date the
ROI is calculated.”
13. Except
as amended by the Amendment, the remaining terms and provisions of the
Agreement(s) shall remain in full force and effect. Nothing in the
Amendment shall be deemed to cause a termination of the
Agreement(s).
IN
WITNESS HEREOF, the Employee and the Corporation have caused Amendment to be
executed as of the date first written above.
EMPLOYEE AMR
CORPORATION
[NAME] Xxxxxxx
X. Xxxxxxxx
Corporate
Secretary
