November 29, 2005
Exhibit 10.16
November 29, 2005
Xx. Xxxxxx X. Xxxxxxx
000 Xxxxx Xxxxxxxx Xxxxxx
Xxxxx 000
Xxxxxxx, XX 00000
000 Xxxxx Xxxxxxxx Xxxxxx
Xxxxx 000
Xxxxxxx, XX 00000
Dear Ed:
This will confirm the following agreement relating to the deferral of your director’s fees in
2006.
1. All director’s fees and retainers (“Fees”) payable to you in connection with your service
on the boards of directors (including committees of such boards) of AMR Corporation and American
Airlines, Inc. for the period January 1, 2006 through the date of the annual meeting of AMR
Corporation, will be deferred and paid to you in accordance with this letter agreement.
2. Fees will be converted to Stock Equivalent Units in accordance with the Directors’ Stock
Equivalent Purchase Plan, a copy of which is attached hereto as Exhibit A (the “Plan”).
3. When you cease to be a Director of AMR Corporation (the “Departure Date”), the Stock
Equivalent Units accrued in 2006 pursuant to the Plan will be paid to you as follows:
| a) | 20% of such units on the 30th business day following the Departure Date; | ||
| b) | 20% of such units on the 1st anniversary of the Departure Date; | ||
| c) | 20% of such units on the 2nd anniversary of the Departure Date; | ||
| d) | 20% of such units on the 3rd anniversary of the Departure Date; | ||
| e) | 20% of such units on the 4th anniversary of the Departure Date; |
The payment will be calculated by multiplying the number of Stock
Equivalent Units to be paid
by the arithmetic mean of the high and low of AMR stock during the month immediately preceding the
payment date.
4. In the event of your death, the number of Stock Equivalent Units as of your date of death
will be multiplied by the fair market value of AMR stock during the calendar month immediately
preceding your death, and the amount paid to Xxxx Xxxxxxx. The payment contemplated by this
paragraph 4 will be made on the 30th business day following the date of your death.
If the foregoing is satisfactory to you, please indicate by signing one of the originals (two
are enclosed) and returning it to me.
Very truly yours,
Xxxxxxx X. XxxXxxx
Corporate Secretary
Corporate Secretary
Accepted and agreed:
/s/ Xxxxxx X. Xxxxxxx
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Xxxxxx X. Xxxxxxx |
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12/02/2005
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Date |
