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EXHIBIT 10.30
CAREER EQUITY PROGRAM
DEFERRED STOCK AWARD AGREEMENT
This AGREEMENT made as of _______, 199_, by and between AMR
Corporation, a Delaware corporation (the "Corporation"), to
<> <> (the "Employee"), employee number <>.
WHEREAS, the stockholders of the Corporation approved the 1988
Long Term Incentive Plan (the "1988 Plan") at the Corporation's annual meeting
held on May 18, 1988; and
WHEREAS, pursuant to the Career Equity Program adopted by the
Board of Directors of the Corporation (the "Board"), the Board has determined to
make a Career Equity Program grant to the Employee of Deferred Stock (subject to
the terms of the l988 Plan and this Agreement), as an inducement for the
Employee to remain an employee of the Corporation, and to retain and motivate
such Employee during his employment with the Corporation.
NOW, THEREFORE, the Corporation and the Employee hereby agree
as follows:
x. Xxxxx of Award. The Employee is hereby granted as of
______, 199_, (the "Grant Date") a Deferred Stock Award (the "Award"), subject
to the terms and conditions hereinafter set forth, with respect to <>
shares of Common Stock, $l.00 par value, of the Corporation ("Stock"). The
shares of Stock covered by the Award shall vest in accordance with Sections 2,
3, 4, 5, and 6 hereof.
2. Vesting - Normal Retirement or Early Retirement. In the
event of the termination of Employee's employment with the Corporation (or any
Subsidiary or Affiliate thereof) on or after the Grant Date due to Normal
Retirement (which is defined as retirement from employment with the Corporation,
or any Subsidiary or Affiliate thereof, at or after age 60), the shares of Stock
covered by the Award shall become fully vested.
In the event of the termination of the Employee's employment
with the Corporation (or any Subsidiary or Affiliate thereof) on or after the
Grant Date due to Early Retirement (which is defined as an early retirement from
employment with the Corporation, or any Subsidiary or Affiliate thereof, at or
after age 55 but before age 60), the shares of stock covered by the Award shall
vest in accordance with the following schedule:
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Percentage of
Award
Age Vested
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55 85%
56 88%
57 91%
58 94%
59 97%
Share certificates for the number of shares covered by a
vested Award (whether in full or partial) shall be issued and delivered to the
Employee on or about the date of Retirement.
Notwithstanding anything to the contrary contained herein and
for the purposes of this Award, in order to be eligible for the benefits
hereunder associated with Early Retirement, the recipient must be entitled to
receive early retirement pension benefits under the then existing policies of
the Corporation, Subsidiary or Affiliate, as applicable.
3. Vesting - Death or Disability. In the event of the
termination of Employee's employment with the Corporation (or any Subsidiary or
Affiliate thereof) on or after the Grant Date due to the Employee's death or
Disability, the shares of Stock covered by the Award shall vest at a rate of 20%
for each full year of employment with the Corporation (or any Subsidiary or
Affiliate thereof) after the Grant Date (with pro rata vesting for each full
month of employment in partial years). In such case, share certificates for the
number of shares so vested shall be issued and delivered 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) within 60 days after the Employee's death or
Disability.
4. Vesting - Termination Not for Cause. If the Employee's
employment with the Corporation (or any Subsidiary or Affiliate thereof) is
terminated on or after the Grant Date by the Corporation (or any Subsidiary or
Affiliate thereof) other than for Cause, the shares of Stock covered by the
Award shall vest at a rate of 10% for each full year of employment with the
Corporation (or any Subsidiary or Affiliate thereof) after the Grant Date (with
pro rata vesting for each full month of employment in partial years). In such
case, share certificates for the number of shares so vested shall be issued and
delivered to the Employee in five equal annual installments with the first
installment being made one year after the date of such termination; provided,
however, that in the event of such termination, vesting of the shares under the
Award as provided herein may be predicated upon the Employee agreeing to such
terms and conditions as required by the Corporation, including, but not limited
to, non-competition and non-disclosure agreements.
5. Vesting - Termination for Cause; Other. In the event that
(a) the Employee's employment with the Corporation (or any Subsidiary or
Affiliate thereof) is terminated for Cause; or (b) the Employee terminates his
employment with the Corporation, or any Subsidiary or Affiliate thereof, (other
than for reasons of Retirement or Disability); or (c) the Employee becomes an
employee of a Subsidiary that is not wholly owned, directly or indirectly, by
the Corporation; or (d) the Employee takes a leave of absence
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without reinstatement rights, unless otherwise agreed in a writing between the
Corporation and the Employee; then all shares of Stock covered by the Award
shall be forfeited.
6. Vesting - Change in Control; Potential Change in Control.
In the event of a Change in Control or Potential Change in Control of the
Corporation, shares under the Award shall vest in accordance with the l988 Plan
or its successor.
7. Elective Deferrals. At any time at least l2 months prior to
the date of the Employee's Retirement, the Employee may elect in writing,
subject to Board approval, to voluntarily defer the receipt of the shares of
Stock covered by the Award for a specified additional period beyond the date of
the Employee's termination of employment (the "Elective Deferral Period"). Any
shares deferred pursuant to this Section 7 shall be issued to the Employee
within 60 days after the end of the Elective Deferral Period. In the event of
the death of the Employee during the Elective Deferral Period, the shares so
deferred shall be issued to the Employee's designated Beneficiary (or to the
Employee's estate, in the absence of an effective beneficiary designation)
within 60 days after the Board receives written notification of death.
8. 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 levy of any such process, the Award shall
immediately become null and void, at the discretion of the Board.
9. 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. If this Award is assumed or a new award is substituted therefore in
any corporate reorganization, employment by such assuming or substituting
corporation or by a parent corporation or subsidiary or affiliate thereof shall
be considered for all purposes of this Award to be employment by the
Corporation. In the event Employee does not forward to the Corporation, within
the applicable period, required taxes with respect to any Award distributed
pursuant to this Agreement, the Corporation may withhold from any payments to be
made to the Employee by the Corporation (or any Subsidiary or Affiliate
thereof), an amount(s) equal to such taxes.
l0. Securities Law Requirements. The Corporation shall not be
required to issue shares pursuant to this Award unless and until (a) such shares
have been duly listed upon each stock exchange on which the Corporation's Stock
is then registered; and (b) a registration statement under the Securities Act of
l933 with respect to such shares is then effective.
The Board may require the Employee to furnish to the
Corporation, prior to the issuance of any shares of Stock in connection with
this Award, an agreement, in such form as the Board may from time to time deem
appropriate, in which the Employee represents that the shares acquired by him
under the Award are being acquired for investment and not with a view to the
sale or distribution thereof.
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ll. Incorporation of l988 Plan Provisions. Except as
contemplated by Section 6, this Agreement is made pursuant to the l988 Plan and
is subject to all of the terms and provisions of the l988 Plan as if the same
were fully set forth herein. Capitalized terms not otherwise defined herein
shall have the meanings set forth for such terms in the l988 Plan.
l2. Participation in Long-Term Incentive Plans. If at the time
of i) Employee's Retirement from the Corporation (or any Subsidiary or Affiliate
thereof) or ii), the termination of Employee's employment with the Corporation
(or any Subsidiary or Affiliate thereof) for reasons contemplated by Sections 3
or 4, the Employee has received payment(s) under the terms of a long-term
incentive plan(s) adopted by any Subsidiary or Affiliate of the Corporation, the
Employee agrees that in lieu of the shares of Stock that have vested pursuant to
this Award, the Employee will receive shares of stock having a fair market value
as of the vesting date equal to the positive difference, if any, between the
fair market value (as of the vesting date) of the shares of Stock that have
vested hereunder and the aggregate nominal value of the payment(s) made under
such long-term incentive plan(s).
13. Payment of Performance Return Payments and Dividend
Equivalents; Voting Rights.
(a) Performance Return Payments. Subject to the terms and
conditions set forth in the attached Schedule A, Performance Return Payments (as
defined in such Schedule A) shall be paid annually on or about the date as may
be designated from time to time by the Board or any committee thereof (the
"Payment Date") on all or a specified portion of the shares of Deferred Stock
covered by this Award, as set forth in such Schedule A, based on: (i) the
greater of (y) a deemed investment rate equal to the Corporation's Rolling
Average ROI as defined and determined in accordance with the terms and
conditions set forth in such Schedule A or (z) 6%; and (ii) the value of the
Stock as determined by the Board, or any committee thereof, pursuant to Schedule
A.
In addition, the Employee shall be entitled, subject to the
consent of the Board, to elect to defer receipt of such Performance Return
Payments in accordance with the American Airlines, Inc. 1987 Executive Deferral
Plan or its successor plan.
(b) Dividend Equivalents. The Employee shall also be entitled
to payment of an amount equal to (i) the amount of any dividend declared per
share on the Corporation's Stock after the Grant Date and prior to issuance to,
or forfeiture by, the Employee of the shares of Deferred Stock covered by this
Award, multiplied by (ii) the number of unissued and unforfeited shares of
Deferred Stock covered by this Award, provided (y) that the amount of any such
dividend equivalents shall be offset by the amount of any Performance Return
Payments paid under this Award within the preceding 11 months and (z) that,
unless the Board otherwise decides prior to the dividend payment date, such
dividend equivalent payment shall be automatically deferred and treated as
additional shares of Deferred Stock, subject to the same terms and conditions
that apply to the related shares of Deferred Stock with respect to which such
dividend equivalents were initially payable.
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(c) Voting and Other Rights. The Employee shall have no
ownership rights, including voting rights, with respect to the shares of
Deferred Stock covered by this Award unless and until shares of stock are
actually issued to the Employee."
* * *
EMPLOYEE AMR CORPORATION
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X. X. XxxXxxx
Corporate Secretary
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Schedule A
Performance Return Payments
1. Performance Return Payments may be paid on a percentage of the shares
covered by the Award, such percentage to be established, from time to
time, by the Chairman of the Corporation.
2. The price of those shares, if any, subject to Performance Return
Payments, will be as determined by the Board, or any committee thereof,
and will approximate the then existing price of the Stock on the New
York Stock Exchange.
3. The three-year rolling average return of investment of AMR Corporation
(the "ROI"), as referenced in Section 13 of the Agreement, will be
calculated as soon as practical following the end of the Corporation's
fiscal year. In determining ROI, the following definitions will
control:
The Measurement Period is the three most recent fiscal years.
AMR is AMR Corporation.
Committee is the AMR Incentive Compensation Committee.
Plan Returns is the sum of AMR pre-tax income, interest expense, and
any accounting adjustments or extraordinary or unusual items which may
be included or excluded at the discretion of the Committee and approved
by the Board of Directors of AMR, or a committee thereof.
Adjusted Investment is the sum of AMR's notes payable, current
maturities of long term debt, current maturities on capital leases,
non-current long term debt, non-current capital leases, and
stockholders' equity and any extraordinary or unusual items which may
be included or excluded at the discretion of the Committee and approved
by the Board of Directors of AMR, or a committee thereof.
Average Adjusted Investment for a fiscal year is (i) the sum of
Adjusted Investment as of December 31 of the immediately prior fiscal
year and Adjusted Investment as of September 30 of the fiscal year for
which ROI is being calculated (ii) divided by two.
ROI for a fiscal year is Plan Returns for a fiscal year divided by
Average Adjusted Investment for that same fiscal year, stated as a
percentage.
ROI for the Measurement Period is the sum of ROI for each year of the
Measurement Period divided by three.
4. In the event of an Employee's termination of employment with the
Corporation (and any Subsidiary or Affiliate thereof) for reasons of
death, Disability, or Retirement, Performance Return Payments, if any,
which are paid on or around the first occurrence of the Payment Date
after the date of death, Disability, or Retirement, shall be paid to
the Employee (or, in the event of the Employee's
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death, the Employee's designated beneficiary for purposes of the
Award, or in the absence of an effective beneficiary designation, the
Employee's estate) at the rate of 8 1/3% for each full or partial
month of employment since the Payment Date of the preceding year.
Notwithstanding the foregoing, however, no Performance Return Payments
shall be made to an Employee if the Employee's employment with the
Corporation (and any Subsidiary or Affiliate thereof) is terminated
for Cause.
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