ALASKA AIR GROUP
OPERATIONAL PERFORMANCE REWARDS PLAN
Adopted January 3, 2005; Amended May 7, 2020 (Effective June 1, 2020)

The Board of Directors of Alaska Air Group, Inc. (the “Company”) has adopted the
Operational Performance Rewards Plan (the “Plan”) to reward employees of Alaska
Airlines, Inc. (“Alaska”) and Horizon Air Industries, Inc. (“Horizon”) (each a
“Subsidiary”) for achieving certain operational performance targets. This
description is provided to explain the key elements of how the Plan will
operate. This Plan is effective beginning with the 2020 Plan year and each year
thereafter until amended or terminated as provided herein.

1. ELIGIBILITY

All regular employees and temporary variable-time employees of Alaska and
Horizon (including employees outside of the United States, if permitted by
applicable law and labor contracts) are eligible to participate in the Plan
(“Eligible Employees”), and will receive one or more payments under the Plan if
they meet the criteria in this paragraph. Payments under the Plan (“Awards”) are
earned monthly and paid quarterly. Eligible Employees on active status or on an
approved leave of absence as of the close of business on the last day of the
quarter during which (a) any of the monthly operational targets applicable to
such employee's applicable Subsidiary are met and (b) employee had eligible
earnings as defined in the Company's Performance Based Pay Plan during the
quarter or, if employee had no eligible earnings, employee was on a
COVID-related unpaid capacity reduction leave will be eligible for a payout for
each month of the quarter in which the employee's applicable Subsidiary's
operational targets are met. For persons with Voluntary Severance Incentive or
equivalent severance packages (whether voluntary or not), the last day of
eligible employment will not include any of the period during which the employee
has ceased working but is still otherwise treated as on payroll.

Unless otherwise provided in a separate agreement, an individual whose
employment with Alaska and Horizon ends prior to the last day of the quarter for
any reason not set forth above, for example, resignation or termination (with or
without cause), forfeits any Award under this Plan. In addition, employees
terminated for cause, as determined by such employee’s applicable subsidiary,
shall forfeit any Award under this Plan, regardless of their employment status
on the last day of the quarter. Notwithstanding the foregoing, contract
employees or independent contractors as classified by Alaska or Horizon, as
applicable, shall be excluded from participation hereunder, regardless of
whether an agency or court subsequently re-classifies such individuals as
employees of Alaska or Horizon. An Eligible Employee who meets all the
requirements for an Award is a “Plan Participant." Participation in the Plan
does not guarantee that any Award will be paid if applicable operational targets
are not achieved.

2. ACCRUAL OF AWARDS
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An Award will accrue for each Participant as of the close of business of the
last day of any quarter in which the applicable Subsidiary has achieved one or
more of the performance goals set forth in Exhibit A. Each Subsidiary does not
need to achieve all of the performance goals in a given quarter to accrue an
Award; each goal reached in a given Target Period (as defined in Exhibit A) will
apply separately towards the Award to that Subsidiary’s Participants for that
quarter.

3. PAYMENT OF AWARDS

Accrued Awards will be paid quarterly. The Company will use reasonable efforts
to pay accrued Awards to Participants within sixty (60) days after the end of
each calendar quarter. The Company may pay Awards through regular payroll or by
separate check in the Company’s discretion, and in either case the Company may
withhold applicable taxes and garnishments from such payments. The Company will
pay a deceased Participant's Award to the beneficiary designated by the
Participant for purposes of the Company's group term life insurance plan
covering the deceased Participant, and in the absence of any designation, will
be paid to the Participant’s estate.

4. ESTABLISHMENT OF PERFORMANCE GOALS

The Compensation and Leadership Development Committee of the Board (the
“Compensation Committee”) will establish the periodic performance goals for each
Plan year during the life of this Plan, and will provide an exhibit to this Plan
that outlines goals and the payout amounts for each goal. Each such attachment
will be labeled “Exhibit A: Operational Performance Rewards Plan Goals and Award
Levels for [year]” and communicated to eligible employees.

5. AMENDMENT; TERMINATION; INTERPETATION

The Board, acting through the Compensation Committee, retains the right at any
time to modify the Plan in any manner that it deems appropriate or to terminate
the Plan, provided that no amendment or termination shall be effective sooner
than the first day of the month following the Compensation Committee’s action on
such amendment or termination. No termination of the Plan shall affect Awards
accrued before the effective date of termination. Management may interpret or
amend this Plan Description with respect to administrative issues that do not
affect benefit amounts and are not otherwise material to the overall benefits
provided by the Plan. The Compensation Committee shall have discretion to
interpret and resolve any material issue or dispute under the Plan, and its
decision concerning any aspect of the operation of the Plan will be final and
conclusive. The Compensation Committee will review the Plan annually and may
make changes to the Plan and/or Exhibit A for the next Plan year.

6. CLAWBACK POLICY
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Awards are subject to the terms of the Company’s recoupment, clawback or similar
policy as it may be in effect from time to time, as well as any similar
provisions of applicable law, any of which could in certain circumstances
require forfeiture of the Awards and repayment or forfeiture of any cash
received with respect to the Awards.

7. MISCELLANEOUS

This description, including its attachments, constitutes the entire
understanding relating to the Plan, and supersedes all prior oral or written
agreements, representations or commitments relating to the Plan or any Award.
This Plan is not a commitment of the Company, Alaska or Horizon, to any officer
or employee of any such company to continue that individual in its employ for
any reason. Any employee who files suit against his or her employer for wrongful
termination shall automatically cease to be a Participant. This description and
the rights and obligations provided for herein shall be construed and
interpreted in accordance with the law of the state of Washington, excluding its
conflicts of law rules.

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