Document:

UAL CORPORATION

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<TYPE> EX-10.16

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Exhibit 10.16

 

 

 

UAL CORPORATION

 

EMPLOYEE STOCK OWNERSHIP PLAN

 

TRUST AGREEMENT

 

 

Between

 

UAL CORPORATION

 

 

and

 

STATE STREET BANK AND TRUST COMPANY

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

July 12, 1994

 

 

 

 

 

 

 

 

TABLE OF CONTENTS

	 	RECITALS	1
	 	 	 
	ARTICLE I	DEFINITIONS	3
	 	 	 
	ARTICLE II	ESTABLISHMENT
OF THE TRUST	4
	 	 	 
	ARTICLE III	POWERS OF
TRUSTEE	5
	 	 	 
	ARTICLE IV	ADMINISTRATION	14
	 	 	 
	ARTICLE V	PAYMENTS
OF BENEFITS AND EXPENSES	16
	 	 	 
	ARTICLE VI	LIABILITY
AND INDEMNIFICATION OF THE TRUSTEE	17
	 	 	 
	ARTICLE VII	ACCOUNTING
OF THE TRUSTEE	19
	 	 	 
	ARTICLE VIII	REMOVAL AND
RESIGNATION OF THE TRUSTEE	21
	 	 	 
	ARTICLE IX	AMENDMENT
AND TERMINATION	21
	 	 	 
	ARTICLE X	LEVERAGED
ACQUISITIONS OF QUALIFYING STOCK	22
	 	 	 
	ARTICLE XI	MISCELLANEOUS	24
	 	 	 

 

 

 

 

UAL CORPORATION

EMPLOYEE STOCK OWNERSHIP PLAN

TRUST AGREEMENT

    THIS AGREEMENT
has been made as of the 12th day of July, 1994, between UAL CORPORATION,
a corporation organized under the laws of the State of Delaware with its
principal place of business in Elk Grove Township, Illinois (hereinafter
referred to as the "Company"), and STATE STREET BANK AND TRUST COMPANY,
a Massachusetts trust company with its principal place of business at 225
Franklin Street, Boston, Massachusetts (hereinafter referred to as the
"Trustee").

 

 

RECITALS

    WHEREAS, the Company
has adopted the UAL Corporation Employee Stock Ownership Plan (the "Plan")
for the benefit of certain employees of the Company and its Affiliates;
and

 

 

    WHEREAS, the Plan
consists of two portions, a "leveraged" portion (Part A) that is intended
to be an employee stock ownership plan and an "unleveraged" portion (Part
B); and

 

 

    WHEREAS, Part
A consists of both a stock bonus plan component and a money purchase pension
plan component and Part B consists solely of a stock bonus component; and

 

 

    WHEREAS, the Plan
provides for the establishment of a trust (the "Trust") to hold, invest
and administer amounts contributed under both Part A and Part B of the
Plan; and

 

 

    WHEREAS, in order
to effectuate the Plan, the Company desires to establish a Trust, designed
to meet the applicable requirements of the Internal Revenue Code of 1986,
as amended (the "Code"), and the Employee Retirement Income Security Act
of 1974, as amended ("ERISA"); and

 

 

    WHEREAS, Part
A and Part B are intended to qualify under Section 401 (a) of the Code
and Part A is intended to qualify under Section 4975(e)(7) of the Code
and to meet the requirements of Section 4975(d)(3) of the Code, and the
Trust is intended to be exempt from federal income taxation under Section
501(a) of the Code; and

 

 

    WHEREAS, the authority
to manage and control the operation and administration of the Plan is vested
in the UAL Employee Stock Ownership Plan ESOP Committee, as named fiduciary
as provided in the Plan, which named fiduciary shall have such authorities
and shall be subject to such duties with respect to the Trust as are specified
in this Agreement and the Plan; and

 

 

    WHEREAS, cash,
property and/or Company Stock (as hereinafter defined) will from time to
time be contributed to or purchased by the Trustee, which assets, as and
when received by the Trustee, will constitute a trust fund to be held for
the exclusive benefit of the participating employees under the Plan or
their beneficiaries and to defray reasonable expenses of administering
the Plan; and

 

 

    WHEREAS, the Company
desires the Trustee to hold and administer such trust fund and the Trustee
is willing to hold and administer such trust fund pursuant to the terms
of this Agreement:

 

 

    NOW, THEREFORE,
in consideration of the premises and of the mutual covenants herein contained,
and intending to be legally bound hereby, the Company and the Trustee do
hereby covenant and agree as follows:

 

 

 

 

 

 

 

 

ARTICLE I

 
DEFINITIONS

Definitions. All defined terms
used herein have the meaning assigned to them in the Plan, except as otherwise
provided herein, and unless the context otherwise requires or unless specifically
provided, all provisions of this Agreement shall apply to both Part A and
Part B. The following terms as used in this Agreement have the meaning
indicated unless the context requires otherwise:

 

 

1.1 "Affiliate" means any corporation,
trade or business, which, at the time of reference, is together with the
Company, a member of a controlled group of corporations, a group of trades
or businesses (whether or not incorporated) under common control or an
affiliated service group, as described in Code sections 415(b), 414 (c)
and 414(m), respectively, or any other organization treated as a single
employer under Code section 414(o); provided, however, that, where the
context so requires, the term "Affiliate" shall be construed to give full
effect to the provisions of Code sections 409(1)(4) and 415(h).

 

 

1.2 "Acquisition Loan" means a loan
(or other extension of credit, including an installment obligation to a
party in interest (as defined in ERISA Section 3(14)) incurred by the Trustee
in connection with the purchase of Qualifying Employer Securities.

 

 

1.3 "Beneficiary" means the person
or persons to whom a deceased Participant's benefits are payable under
the Plan.

 

 

1.4 "Board of Directors" means the
Board of Directors of the Company.

 

 

1.5 "Company" means UAL Corporation
and any successor thereto.

 

 

1.6 "Company Stock" means anystock
issued by the Company (or a corporation which is a member of the same controlled
group) which meet the requirements of Section 407 of ERISA or Section 409(1)
of the Code.

 

 

1.7 "Employee Group" means "Employee
Group" as defined in the Plan.

 

 

1.8 "ERISA" means the Employee Retirement
Income Security Act of 1974, as amended, and all successor laws thereto.

 

 

1.9 "ESOP Committee" means the committee
appointed to administer the Plan pursuant to Section 11 thereof.

 

1.10 "Fund" means the contributions
of cash or property reasonably acceptable to the Trustee, including, but
not limited to, Company Stock deposited with or purchased by the Trustee
and held under this Trust by the Trustee, any property into which the same
or any part thereof may from time to time be converted, and any appreciation
therein or income thereon less any depreciation therein, any losses thereon
and any distributions or payments therefrom.

 

 

1.11 "Participant" means an employee
of the Company or any Affiliate or any other person who has an account
balance under the Plan.

 

 

1.12 "Prohibited Transaction" means
a prohibited transaction under Sections 406 of ERISA and/or Section 4975(c)(1)
of the Code which is not exempt under Section 408 of ERISA or Sections
4975(c)(2) or 4975(d) of the Code, as the case may be.

 

1.13 "Qualifying Employer Securities"
means shares of stock, common or preferred, issued by the Company (or a
corporation which is a member of the same controlled group) which meets
the requirements of Section 409(1) of the Code.

 

 

ARTICLE II

 

ESTABLISHMENT OF THE TRUST

2.1 The Company hereby establishes
with the Trustee a trust for the purpose of holding and administering the
Fund in accordance with this Agreement.

 

 

2.2 Notwithstanding anything to the
contrary in this Agreement, or in any amendment thereto, except as otherwise
provided under ERISA, the Company, the ESOP Committee and the Trustee shall
discharge their respective duties with respect to the Fund for, and the
Fund shall be used solely for and not diverted from, the exclusive purposes
of providing benefits for Participants and their Beneficiaries and defraying
reasonable expenses of administering the Plan. Notwithstanding the preceding
sentence, however, contributions shall be returned by the Trustee to the
Company at the direction of the ESOP Committee if (i) the ESOP Committee
certifies in writing to the Trustee that one or more of the circumstances
listed below exist and (ii) prior to any such return of contributions,
appropriate arrangements shall have been made to protect the substantive
rights of each Employee Group under the Plan:

 

 

2.2.1 if a contribution is made
by the Company by reason of a mistake of fact, the contribution or the
then current value thereof, if less, shall be returned to the Company without
interest within one year after it was paid to the Trustee;

 

 
2.2.2. if the deduction of a contribution
is disallowed by the Internal Revenue Service, the contribution, or the
then current value thereof, if less, to the extent the deduction is disallowed
shall be returned to the Company without interest within one year after
the disallowance; and

 

 

2.2.3. if the initial qualification
of the Plan under Sections 401, 409 and 4975(e)(7) of the Code is denied,
the entire Fund or the then current value thereof, if less, shall be returned
to the Company without interest within one year after such qualification
has been denied.

 

 

2.3 The Trustee shall receive any contributions
paid to it in cash, in Company Stock or in other property acceptable to
it. All contributions so received, together with the income therefrom and
any other increment thereon, shall be held, managed and administered by
the Trustee pursuant to the terms of this Agreement without distinction
between principal and income and without liability for the payment of interest
thereon. The Trustee shall not be responsible for the collection of any
contributions to the Plan, or for the determination of the amount or frequency
of any contribution required by the Plan or the provisions of the Code
or ERISA, which responsibilities shall be borne solely by the ESOP Committee.

 

 

ARTICLE III

 

POWERS OF TRUSTEE

3.1 The Trustee shall maintain books
of account and records with respect to the Fund. The Fund shall be held
by the Trustee in trust and dealt with in accordance with the provisions
of this Agreement. The Trustee shall take all action necessary to implement
any written directions received from the ESOP Committee and shall conform
to procedures established by the ESOP Committee for disbursement of funds
in accordance with the terms of the Plan.

 

 

3.2 It shall be the duty of the Trustee
(a) to hold, invest and reinvest the Fund in accordance with the provisions
of this Agreement, and (b) to pay moneys therefrom in accordance with the
written directions of the ESOP Committee.

 

 

3.3 Subject to Paragraphs 3.6, 3.7
and 3.8, at the direction of the ESOP Committee, the Trustee shall invest
the assets of the Fund exclusively in Company Stock (except for di minimis
investments in cash or cash equivalents pending investment in Company Stock
or pending distributions to Participants); provided, however, that the
portion of the Fund attributable to Part A of the Plan is intended to be
invested primarily in Qualifying Employer Securities. To the extent that
Company contributions are made in Company Stock, the Trustee shall retain
such Company Stock unless otherwise directed by the ESOP Committee. To
the extent Company contributions are made in cash and are not used to pay
principal or interest on an Acquisition Loan pursuant to Article X or to
pay expenses of the Fund, the Trustee shall, at the direction of the ESOP
Committee, acquire Company Stock. If at the time Company Stock is to be
purchased, the Company has outstanding more than one class of Company Stock,
the ESOP Committee shall direct the Trustee as to which class of Company
Stock shall be purchased. Subject to Paragraph 3.8, the Trustee may rely
in good faith without liability upon the valuation of Company Stock as
determined by the ESOP Committee. The Trustee may also, at the direction
of the ESOP Committee, invest the Fund in temporary investments other than
Company Stock, may hold such portion of the Fund in such investments as
may be required under the investment diversification provision of the Plan,
may hold such portion of the Fund uninvested as the ESOP Committee deems
advisable for making distributions under the Plan, may invest assets of
the Fund in short-term investments bearing a reasonable rate of interest,
including without limitation, deposits in, or short-term instruments of,
the Trustee, or in one or more short-term collective investment funds administered
by the Trustee as trustee thereof for the collective investment of assets
of employee pension or profit-sharing trusts, as long as each such collective
investment fund constitutes a qualified trust under the applicable provisions
of the Code (and while any portion of the Fund is so invested, such collective
investment funds shall constitute part of the Plan to the extent of such
investment, and the instrument creating such funds shall constitute part
of this Agreement).

 

 

3.4 The Trustee shall have no duty
hereunder to determine or inquire into whether any directions received
from the ESOP Committee in accordance with the terms of this Agreement
represent proper and lawful decisions or result in Prohibited Transactions.
The Trustee shall have no duty to review any investment to be acquired,
held or disposed of pursuant to such instructions from the ESOP Committee.
If the Trustee does not receive written directions with respect to any
part of the Fund subject to the ESOP Committee's direction (including,
without limitation, income, sale proceeds or contributions), the Trustee
shall, pending receipt of such directions, hold and invest such amount
in short-term securities as provided in Paragraph 3.3 hereof.

 

3.5 In addition to, and not in limitation
of, the powers now, or which may later become, vested in it, the Trustee
shall have the following powers; provided, however, that the Trustee's
exercise of such powers shall be consistent with and subject to all other
provisions of this Agreement, and provided further that, subject to the
provisions of Paragraph 3.6, 3.7, and 3.8, the powers set forth in Paragraphs
3.5.1, 3.5.2, 3.5.3, and 3.5.4 shall be exercised by the Trustee only to
the extent and in the manner directed by the ESOP Committee, a Participant
or a Beneficiary in accordance with the terms of this Agreement, except
as otherwise required by ERISA:

 

 

3.5.1 To hold, invest and reinvest
the principal or income of the Trust in bonds, common or preferred stock,
other securities, or other personal, real or mixed tangible or intangible
property, including any securities issued by the Company or its Affiliates
(including investment in deposits with Trustee which bear a reasonable
interest rate, including without limitation investments in trust savings
accounts, certificates of deposit, time certificates or similar investments
or deposits maintained by the Trustee);

 

 
3.5.2 To exercise voting rights either
in person or by proxy, with respect to any securities or other property,
and generally to exercise with respect to the Fund all rights, powers and
privileges as may be lawfully exercised by any person owning similar property
in his own right;

 

 

3.5.3 To exercise any options, conversion
rights, put rights, or rights to subscribe for additional stocks, bonds
or other securities appurtenant to any securities or other property held
by it, and to make any necessary payments in connection with such exercise,
and to join in, dissent from, and oppose the reorganization, consolidation,
recapitalization, liquidation, merger or sale of corporate property with
respect to any corporations or property in which it may be interested as
Trustee;

 

 

3.5.4 To compromise, compound, and
settle any debt or obligation owing to or from it as Trustee, and to reduce
or increase the rate of interest on, extend or otherwise modify, foreclose
upon default, or otherwise enforce any such obligation;

 

 

3.5.5 To sue or defend suits or legal
proceedings to enforce or protect any interest of the Trust, and to represent
the Trust in all suits or legal proceedings in any court or before any
other administrative agency, body or tribunal, provided that the Trustee
is indemnified to the Trustee's satisfaction against liability and expenses;

3.5.6 To hold any property
at any place, except that it shall not maintain the indicia of ownership
of any assets of the Fund outside the jurisdiction of the district courts
of the United States except as permitted by regulations issued by the Secretary
of Labor of the United States under ERISA Section 404(b);

3.5.7 To make, execute,
acknowledge and deliver assignments, agreements and other instruments;

 
3.5.8 To register any securities
held by it hereunder in its own name or in the name of a nominee with or
without the addition of words indicating that such securities are held
in a fiduciary capacity, to permit securities or other property to be held
by or in the name of others, to hold any securities in bearer form and
to deposit any securities or other property in a depository, clearing corporation
or similar corporation, either domestic or foreign; provided, however,
that the records of the Trustee shall at all times show that any such property
held or registered in the name of another is part of the Fund;

 
3.5.9 To employ legal counsel,
brokers and other advisors, agents or employees to perform services for
the Fund or to advise it with respect to its duties and obligations under
this Agreement and in connection with the Trust, and to pay them reasonablecompensation
from the Fund, to the extent not paid directly by the Company or an Affiliate;

 
3.5.10 In accordance with
the applicable provisions of the Plan and subject to Paragraph 3.8, to
obtain an Acquisition Loan in such amounts and upon such terms and conditions
as shall be deemed advisable or proper to carry out the purposes of the
Trust, and, in connection therewith, to issue its promissory note as Trustee,
to pledge any securities or other property of the Fund for the repayment
of such Acquisition Loan and to repay from time to time the principal and
interest on, and to take any other action with respect to, such Acquisition
Loan; provided that if such Acquisition Loan is from, or guaranteed by,
a "party of interest" within the meaning of Section 3(14) of ERISA, the
requirements of Article X shall be satisfied;

 
3.5.11 To open and make
use of banking accounts including checking accounts, which accounts, if
bearing a reasonable rate of interest or if checking accounts, may be with
the Trustee.

 
3.6 Voting of Company Stock

3.6.1 Allocated Shares. Each
Participant (or Beneficiary) as a named fiduciary within the meaning of
ERISA section 403(a)(1), in accordance with the procedures hereinafter
set forth, may direct the Trustee with respect to the votes of the shares
of Company Stock allocated to his ESOP Stock Account, and the Trustee shall
follow the directions of those Participants (and Beneficiaries) who provide
timely instructions to the Trustee; provided that, notwithstanding the
foregoing, the Trustee shall vote the shares of Company Stock allocated
to the Part B Accounts of the Participants who are (or were) members of
the ALPA Employee Group but who are not Employees (or allocated to the
Part B Accounts of their Beneficiaries.)

 

 
3.6.2 Unallocated and Uninstructed
Shares.

 

 
(i) Part A. Each active Participant
(which shall be defined for purposes of Sections 3.6 and 3.7 to mean a
Participant who is an Employee) who directed the Trustee with respect to
the shares allocated to his Account under Part A in accordance with Section
3.6.1 may, again as a named fiduciary, direct the Trustee with respect
to a portion of both the number of shares of Company Stock held in the
Loan Suspense Account and the number of such shares allocated to any Participant's
Account under Part A for which no instructions were timely received by
the Trustee. Such portion shall be determined as follows:

 

 

(A) Such portion shall be limited
to the sum of: (I) the number of shares of Company Stock held in the Loan
Suspense Account reserved for allocation to such Participant's Employee
Group, plus (ii) the number of shares of Company Stock allocated to the
Accounts of Participants in such Participant's Employee Group under Part
A for which no instructions were timely received.

 

 

(B) The number of shares of Company
Stock determined under clause (i)(A) shall be multiplied by a fraction,
the numerator of which is the number of shares of Company Stock allocable
to Part A that such Participant directed the Trustee in accordance with
Section 3.6.1 and the denominator of which is the aggregate number of shares
allocable to Part A that were directed by active Participants in the same
Employee Group in accordance with Section 3.6.1.

 

 

(C) Such Participant, as a named
fiduciary, shall be entitled to direct the Trustee with respect to the
number of shares determined under clause (i)(B).

(ii) Part B. Each active Participant
who directed the Trustee with respect to shares allocated to his Account
under Part B in accordance with Section 3.6.1(a) may, again as a named
fiduciary, direct the Trustee with respect to a portion of the number of
such shares allocated to any Participant's Account under Part B for which
no instructions were timely received by the Trustee. Such portion
shall be determined as follows:

 

 

(A) Such portion shall be limited
to the number of shares of Company Stock allocated to the Accounts of Participants
in such Participant's Employee Group under Part B for which no instructions
were timely received.

 

 

(B) The number of shares of Company
Stock as determined under clause (ii)(A) shall be multiplied by a fraction,
the numerator of which is the number of shares of Common Stock allocable
to Part B that such Participant directed the Trustee in accordance with
Section
3.6.1 and the denominator of which is the aggregate number of shares allocable
to Part B that were directed by active Participants in the same Employee
Group in accordance with Section 3.6.1.

 

 

(C) Such Participant, as a named
fiduciary, shall be entitled to direct the Trustee with respect to the
number of shares determined under clause (ii)(B).

 

 

3.6.3 Procedure. Such directions
shall be provided directly to the Trustee and shall be held in confidence
and not be divulged or released to any other person. Within a reasonable
time prior to each annual or special meeting of holders of Company Stock,
the ESOP Committee shall furnish to all Participants (and Beneficiaries)
entitled to direct the Trustee as to the voting of shares of Company Stock,
copies of any proxy solicitation material provided to holders of voting
Company Stock generally together with appropriate instruction forms or
cards andinformation concerning the method of providing such instructions
to the Trustee. To the extent permitted by law, if the Trustee cannot follow
directions of Participants (or Beneficiaries), the ESOP Committee shall
direct the Trustee.

 

 

Notwithstanding any other provision
of this Agreement or the Plan, the Trustee shall not be obligated to follow
the direction of a named fiduciary unless such direction is in accordance
with the terms of the Plan and is proper within the meaning of Section
403 (a) of ERISA and is not contrary to ERISA.

 

3.7 _Control Transactions and
Certain Dispositions of Company Stock.

 

 

3.7.1 General. The provisions
of this Section 3.7 shall apply in the event a Control Transaction is commenced
or proposed by a person or persons. In the event a Control Transaction
is commenced or proposed, the ESOP Committee, promptly after receiving
notice, shall transfer certain of the ESOP Committee's record keeping functions
under the Plan to an independent record keeper (which if the Trustee consents
in writing, may be the Trustee). The functions so transferred shall be
those necessary to preserve the confidentiality of any directions given
by the Participants (and Beneficiaries) in connection with the Control
Transaction. Within a reasonable time after a Control Transaction is commenced,
the ESOP Committee shall furnish to all Participants (and Beneficiaries)
entitled, as hereinafter set forth, to direct the Trustee with respect
to the Control Transaction, copies of all offering material provided to
holders of Company Stock generally, together with appropriate instruction
forms or cards and information concerning the method of providing such
instructions to the Trustee. Except as otherwise required by ERISA, the
Trustee shall have no discretion or authority to sell, exchange, transfer,
convert or otherwise dispose of any of such shares of Company Stock pursuant
to such Control Transaction, except to the extent that the Trustee is timely
directed to do so in writing as follows:

 

 
(i) Allocated Shares. Each
Participant (or Beneficiary) to whose ESOP Stock Account shares of Company
Stock have been allocated may, as a named fiduciary within the meaning
of ERISA section 403(a)(1), direct the Trustee with respect to the sale,
exchange, transfer, conversion or other disposition of the shares of Company
Stock allocated to his ESOP Stock Account, and the Trustee shall follow
the directions of those Participants (and Beneficiaries) who provide timely
instructions to the Trustee.

 

 
(ii) Unallocated and Uninstructed
Shares.

(A) Part A. Each active
Participant who directed the Trustee with respect to shares allocated to
his Account under Part A in accordance with Section 3.7.1(i) may, again
as a named fiduciary, direct the Trustee with respect to a portion of both
the number of shares of Company Stock held in the Loan Suspense Account
and the number of such shares allocated to any Participant's Account under
Part A for which no instructions were timely received by the Trustee. Such
portion shall be determined as follows:

(I) Such portion shall be limited to
the sum of: (x) the number of shares of Company Stock held in the Loan
Suspense Account reserved for allocation to such Participant's Employee
Group, plus (y) the number of shares of Company Stock allocated to the
Accounts of Participants in such Participant's Employee Group under Part
A for which no instructions were timely received.

 

 
(II) The number of shares of Company
Stock determined under clause (ii)(a)(I) shall be multiplied by a fraction,
the numerator of which is the number of shares of Company Stock allocable
to Part A that such Participant directed the Trustee in accordance with
Section 3.7.1(i) and the denominator of which is the aggregate number of
shares allocable to Part A that were directed by active Participants in
the same Employee Group in accordance with Section 3.7.1(i).

 

 

(III) Such Participant, as a named
fiduciary, shall be entitled to direct the Trustee with respect to the
number of shares determined under clause

(ii)(A)(II).

 

 

(B) Part B. Each active Participant
who directed the Trustee with respect to shares allocated to his Account
under Part B in accordance with Section 3.7.1(i) may, again as a named
fiduciary, direct the Trustee with respect to a portion of the number of
such shares allocated to any Participant's Account under Part B for which
no instructions were timely received by the Trustee. Such portion shall
be determined as follows:

 

 

(I) Such portion shall be limited
to the number of shares of Company Stock allocated to the Accounts of Participants
in such Participant's Employee Group under Part B for which no instructions
were timely received.

 

 
(II) The number of shares of Company
Stock determined under clause (ii)(B)(I) shall be multiplied by a fraction,
the numerator of which is the number of shares of Company Stock allocable
to Part B that such Participant directed the Trustee in accordance with
Section 3.7.1(a)(i) and the denominator of which is the aggregate number
of shares allocable to Part B that were directed by active Participants
in the same Employee Group in accordance with Section 3.7.1(a)(i).

 

 

(III) Such Participant, as a named
fiduciary, shall be entitled to direct the Trustee with respect to the
number of shares determined under clause (ii)(B)(II).

All such instructions from Participants
(and Beneficiaries) shall be provided directly to the independent record
keeper which, if different from the Trustee, shall then instruct the Trustee
as to the amount of shares to be sold, tendered, exchanged, converted or
otherwise disposed of in accordance with the above directions. To the extent
the Trustee cannot follow Participant (or Beneficiary) instructions, the
ESOP Committee, as a named fiduciary, shall direct the Trustee. Except
as contemplated by the foregoing or as required to facilitate the making
of Plan distributions or diversification elections or as required by law,
the Trustee shall have no authority to dispose of Company Stock in a Control
Transaction or otherwise.

 

 

Notwithstanding any other provision
of this Agreement or the Plan, the Trustee shall not be obligated to follow
the direction of a named fiduciary unless such direction is in accordance
with the terms of the Plan and is proper within the meaning of Section
403(a) of ERISA and is not contrary to ERISA.

 

 

3.7.2 Records. Following any
Control Transaction that has resulted in the sale or exchange of any shares
of Company Stock held in the Plan, the record keeper shall continue to
maintain on a confidential basis the Accounts of Participants (and Beneficiaries)
to whose Accounts shares of Company Stock were allocated at any time during
such offer, until complete distribution of such Accounts or such earlier
time as the record keeper determines that the transfer of the record keeping
functions back to the ESOP Committee will not violate the confidentiality
of the directions given by the Participants (and Beneficiaries). In the
event that there is no sale or exchange of any shares of Company Stock
held in the Plan pursuant to the Control Transaction, the record keepershall
transfer back to the ESOP Committee the record keeping functions; provided,
however, that the record keeper shall keep confidential any instructions
which it may receive from Participants (and Beneficiaries) relating to
the Control Transaction.

 

 

3.7.3 Proceeds. For purposes
of allocating the proceeds of any sale or exchange pursuant to a Control
Transaction, the ESOP Committee or the independent record keeper, as the
case may be, shall determine the portion, expressed as a percentage, of
shares of each class tendered by the Trustee that were actually sold or
exchanged (the "applicable percentage" for that class). For each class,
the ESOP Committee or the independent record keeper, as the case may be,
shall then treat as having been sold or exchanged from the portion of the
Loan Suspense Account applicable to that Employee Group and each of the
individual Accounts of Participants (and Beneficiaries) that number of
shares (of that class) that is obtained by multiplying (i) the applicable
percentage for that class, times (ii) the total number of shares in such
Account of that class that were directed to be tendered or exchanged or
sold in connection with the Control Transaction. The adjustments to individual
Accounts shall be made by the ESOP Committee or the independent record
keeper, as the case may be, on information supplied by the Company, the
ESOP Committee or the Trustee.

 

3.8 Notwithstanding any other provisions
of this Agreement or the Plan, the purchase of Qualifying Employer Securities
pursuant to the ESOP Preferred Stock Purchase Agreement dated March 25,
1994, as amended, or pursuant to any Additional Acquisition Loans (including
loans to effect Section 8.2 (e) of the Plan and Section 1.6 (g) of the
Recapitalization Agreement) among the Trustee and the Company shall be
effected by the Trustee without direction from the ESOP Committee pursuant
to the Trustee's determination, in the exercise of its reasonable judgment
after consultation with such advisors as it reasonably deems necessary,
that such transaction is in the best interests of the Participants and
Beneficiaries and that the purchase transaction and the terms and conditions
of any Acquisition Loan entered into in connection with the above-described
Purchase Agreement are in compliance with all applicable provisions of
the Code and ERISA.

 

 

3.9 In addition to, and not in limitation
of, the powers vested and to be vested in it by law or enumerated in this
Article III, the Trustee shall have the power to take any action with respect
to the Fund as is appropriate and helpful in carrying out the purposes
of this Agreement, subject to any directions of the ESOP Committee or the
Participants (or Beneficiaries) as provided herein.

 

 

ARTICLE IV

ADMINISTRATION

4.1 The ESOP Committee shall represent
the Company in dealing with the Trustee under this Agreement. Until it
receives written notice that a person is no longer a member of the ESOP
Committee, the Trustee shall be fully protected in assuming that the person
is still a member of the ESOP Committee. The Company shall cause to be
delivered to the Trustee a specimen signature of each member as well as
that of any designee of the ESOP Committee appointed pursuant to Paragraph
4.2. The members of the ESOP Committee shall be "named fiduciaries"
within the meaning of ERISA Section 402(a) with respect to the Plan.

 

 

4.2 The Trustee may rely (and shall
be fully protected in relying) on any written communication signed by a
majority of the members of the ESOP Committee as being authorized by, and
reflecting the action of, the ESOP Committee. If the Trustee is advised
in writing by a majority of the members of the ESOP Committee that directives
to the Trustee will be signed by a person or persons designated by the
ESOP Committee, the Trustee may rely on communications signed by the person
or persons so named as a directive reflecting the action of the ESOP Committee.

 

 

4.3 The Trustee shall have only those
duties specified in this Agreement or specified in the Plan and expressly
incorporated herein by reference. In the event of any conflict between
the provisions of the Plan and this Agreement, the provisions of this Agreement
shall control. The Trustee shall have no responsibility to administer or
interpret the Plan, to enforce payment of any contributions to the Fund
or to see that the Fund is adequate to meet the liabilities of the Plan.

 

 

4.4 The Company or anyone acting
on its behalf may at any time employ the Trustee in its corporate capacity
as agent to perform any act or to keep any records in connection with the
administration of the Plan. Any such agency relationship shall be established
by a separate written agreement between the Company and the Trustee and
the existence of such arrangement shall not affect its responsibility or
liability as Trustee under this Agreement.

 

 

4.5 Notwithstanding any other provision
of the Plan or this Agreement, the Trustee shall not be obligated to follow
the direction of a named fiduciary unless such direction is in accordance
with the terms of the Plan or this Agreement and is proper under ERISA
Section 403(a)(2) and not contrary to Title I of ERISA.

 

 

4.6 With respect to the exercise
of any fiduciary responsibility with respect to the Plan or the Trust,
including, without limitation, the voting, sale, exchange, other disposition
or conversion of Company Stock, the Trustee and any other relevant fiduciary
may, to the extent permitted by law, take into consideration any relevant
economic factors affecting the interests of current and future Participants
(and Beneficiaries), including, but not limited to, the prospect
for continued Employee enfranchisement through the voting power of Company
Stock held in the Trust, the prospect for future benefits under the Plan
as a result of the prospective release and allocation of Qualifying Employer
Securities held in the Loan Suspense Account and the prospect for future
employment with the Company and its Affiliates.

 

 

ARTICLE V

 

 

PAYMENTS OF BENEFITS AND EXPENSES

5.1 Except as otherwise provided
in Paragraph 5.3, the Trustee shall pay benefits and administrative expenses
under the Plan only when it receives (and in accordance with) written instructions
from the ESOP Committee, indicating the amount of the payment and the name
and address of the recipient. The Trustee shall have no duty to inquire
into whether any payment the ESOP Committee instructs it to make is consistent
with the terms of the Plan or applicable law or otherwise proper. Any payment
made by the Trustee in accordance with such instructions shall be a complete
discharge and acquittance to the Trustee. If the ESOP Committee advises
the Trustee that benefits have become payable respecting a Participant's
interest in the Fund, but does not instruct the Trustee as to the manner
of payment, the Trustee shall hold the Participant's interest in the Trust
until it receives written instructions from the ESOP Committee as to the
manner of payment. The Trustee shall not pay benefits from the Fund without
such instructions, even though it may be informed from other sources, including,
without limitation, a Participant (or beneficiary), that benefits are payable
under the Plan. The Trustee shall have no responsibility to determine when,
to whom, or in what amounts benefits and expenses are payable under the
Plan.

 

 

5.2 The Trustee shall distribute
benefits in the manner described in the Plan and as directed by the ESOP
Committee.

 

 

5.3 The Trustee shall receive as
compensation for its services as Trustee such amounts as may, from time
to time, be agreed upon in writing between the Company and the Trustee.
Such compensation and, in accordance with the applicable provisions of
ERISA and the Code, all reasonable and proper expenses incurred by the
Trustee in the administration of the Trust, including reasonable legal
counsel fees, shall be paid by the Company.

 

 

5.4 The Company intends that the
Plan shall at all times qualify under Code Sections 401(a), 409 and, to
the extent applicable, 4975(e)(7) and that the Trust hereby established
shall at all times be tax exempt under Section 501(a) of the Code, or successor
provisions. However, any taxes that may be levied upon or in respect of
the Fund shall be paid from the Fund. The Trustee shall promptly notify
the ESOP Committee of any proposed taxes (other than stock transfer taxes)
of which it receives notice and may assume that any such taxes are lawfully
levied or assessed, unless the ESOP Committee advises it in writing to
the contrary within fifteen (15) days after receiving the above notice
from the Trustee. In such case, the Trustee, if requested by the ESOP Committee
in writing, shall contest the

validity of such taxes in any manner
deemed appropriate by the

ESOP Committee; the Company may
itself contest the validity of

any such taxes, in which case the
ESOP Committee shall so notify

the Trustee and the Trustee shall
have no responsibility or

liability respecting such contest.
If any party to this Agreement contests any such proposed levy, the other
party shall provide such information and cooperation as the party conductingthe
contest shall reasonably request.

 

 

ARTICLE VI

 

LIABILITY AND INDEMNIFICATION
OF THE TRUSTEE

6.1 The Trustee shall not be responsible
for computing or collecting contributions due under the Plan.

 

 

6.2 The Trustee in its corporate
capacity shall not be liable for claims of any persons arising under the
Plan; such claims shall be limited to the Fund. The Trustee shall not be
liable to make distributions or payments of any kind unless sufficient
funds are available therefor in the Fund. The Trustee shall be responsible
only for such money and other property as are actually received by it as
Trustee under this Agreement.

 

 

6.3 The Trustee may consult with
legal counsel with respect to the meaning and construction of this Agreement
or its powers, obligations and conduct hereunder, and the written
opinion of such counsel will, to the extent permitted by law, be full and
complete protection in respect of any action taken or omitted by the Trustee
hereunder in good faith and in accordance with the opinion of such counsel.

 

 

6.4 The Trustee shall have no liability
other than as imposed by law and this Agreement.

 

 

6.5 The Trustee shall be fully protected
in acting upon any instrument, certificate, or paper delivered by the Company,
the ESOP Committee, any Participant, (or Beneficiary) acting as a named
fiduciary and believed by the Trustee to be genuine and to be signed or
presented by the proper person or persons, and the Trustee shall be under
no duty to make any investigation or inquiry as to any statement contained
in any such writing, but may accept the same as conclusive evidence of
the truth and accuracy of the statements therein contained.

 

 

6.6 To the extent permitted by applicable
law, the Trustee shall be indemnified by the Company and UAL against any
and all liabilities, settlements, judgments, losses, costs, and expenses
(including reasonable legal fees and expenses) of whatever kind and nature
which may be imposed on, incurred by or asserted against the Trustee by
reason of the performance or nonperformance of its trustee function under
this Agreement, except to the extent such action or inaction constituted
negligence, willful misconduct or failure to act in good faith on the part
of the Trustee.

 

 

6.7 All notices, requests, demands
and other communications hereunder or with respect hereto shall be in writing
and shall be deemed to have been fully given if telegraphed, telecopied
or telefaxed, mailed by registered or certified mail, or personally delivered
(or delivered by courier) as follows:

 

 

If to the Company, to:

 

 
By Mail

UAL Corporation

P.O. Box #66919

Chicago, IL 60666

Attention: Corporate Secretary

 

 

By Courier

UAL Corporation

1200 Algonquin Road

Elk Grove Township, IL 60007

Attention: Corporate Secretary

 

 
If to the Trustee, to:

 

State Street Bank and Trust Company

225 Franklin Street

Boston, MA 02110

Attention: UAL ESOP Administration

 

 

or to such other address or addresses
as any party hereto may furnish to the other party in writing.

 

 

6.8 Whenever the Trustee shall deem
it desirable for a matter to be proved or established before taking, permitting
or omitting any act, the matter (unless other evidence in respect thereof
is specifically prescribed in this Agreement) may be deemed to be conclusively
established by a certification signed by a majority of the members of the
ESOP Committee and delivered to the Trustee, and the Trustee shall be fully
protected in relying on such an instrument.

 

 

6.9 If a dispute arises as to the
payment of any funds or delivery of any assets by the Trustee, the Trustee
may withhold such payment or delivery until the dispute is determined by
a court of competent jurisdiction or finally settled in writing by the
parties concerned.

 

 

ARTICLE VII

 

 

ACCOUNTING OF THE TRUSTEE

7.1 The Trustee shall keep accurate
and detailed accounts of all its transactions (including receipts and disbursements)
under this Agreement. These records shall be open to inspection and audit
during regular business hours of the Trustee by the ESOP Committee or any
person or persons designated by the ESOP Committee or the Company in a
written instrument

filed with the Trustee. If mutually
agreed upon in a separate

writing by the ESOP Committee and
the Trustee, the Trustee shall

establish and maintain accountsfor
Participants which shall show

their respective interests, determined
in accordance with the

terms of the Plan, in the Fund;
provided, however, that to the

extent that such accounts are kept
by the Trustee on the basis of

information furnished or caused
to be furnished to it by the ESOP

Committee, the Trustee shall have
no responsibility for the

accuracy of any information so furnished.
All such accounts and

records shall be preserved (in original
form, or on microfilm,

magnetic tape or any other similar
process) for such period as

the Trustee may determine, but the
Trustee may destroy such

accounts and records only after
first notifying the ESOP

Committee and the Company in writing
at least ninety (90) days in

advance of its intention to do so
and transferring to the ESOP

Committee or the Company any such
accounts and records requested.

 

 

7.2 Within sixty (60) days after
the close of each fiscal year of the Plan, the Trustee's removal or resignation
as Trustee hereunder, or the termination of the Plan or this Agreement,
the Trustee shall file with the ESOP Committee an account setting forth
all its transactions (including all receipts and disbursements) under this
Agreement during such year, or during the period from the close of the
last preceding fiscal year of the Plan to the effective date of its removal
or resignation or the termination of the Plan or this Agreement, and showing
all property (including its costs and fair market value) held by it hereunder
at the end of such accounting period; provided, however, that in the event
shares of Company Stock are then held in the Trust and a final valuation
report, if necessary, with respect to such Company Stock for any such accounting
period is not received by the Trustee within thirty (30) days of the date
the Trustee is required to render an accounting under the foregoing provision,
then the Trustee shall not be required to render such account until thirty
(30) days from the date such valuation report is received by the Trustee.
The ESOP Committee and the Trustee may agree in writing that similar accounts
will be prepared by the Trustee and filed with the ESOP Committee at more
frequent intervals. No person or persons (including, without limitation,
the Company and the ESOP Committee) shall be entitled to any further or
different accounting by the Trustee, except as may be required by law.

 

 

7.3 Twenty-four (24) months after
the filing with the ESOP Committee of the annual accounts for the 1994
and 1995 fiscal years of the Trust and twelve (12) months after the filing
with the ESOP Committee of any other account under Paragraph 7.2, the Trustee
shall be forever released and discharged from any liability or accountability
to the Company and the ESOP Committee with respect to the transactions
shown or reflected on the account, except with respect to any acts or transactions
as to which the ESOP Committee, within the applicable period, files written
objections with the Trustee. The written approval of the ESOP Committee
of any account filed by the Trustee, or the ESOP Committee's failure to
file written objections within the applicable period, shall be a settlement
of such account as against the Company and the ESOP Committee, and shall
forever release and discharge the Trustee from any liability or accountability
to the Company and the ESOP Committee with respect to the transaction shown
or reflected on such account. If a statement of objection is filed by the
ESOP Committee and the ESOP Committee is satisfied that its objections
should be withdrawn or if the account is adjusted to its satisfaction,
the ESOP Committee shall indicate its approval of the account in a written
statement filed with the Trustee and the Trustee shall be forever released
and discharged from all liability and accountability to the Company and
the ESOP Committee in accordance with the immediately preceding sentence.
If an objection is not settled by the ESOP Committee and the Trustee, the
Trustee may commence a proceeding for a judicial settlement of the account
in any court of competent jurisdiction; the only parties that need be joined
in such a proceeding are the Trustee, the ESOP Committee, the Company and
such other parties whose participation is required by law.

 

 

ARTICLE VIII

 

 

REMOVAL AND RESIGNATION OF THE
TRUSTEE

8.1 The Trustee may resign as Trustee
under this Agreement at any time by a written instrument delivered to the
Company giving notice of such resignation, which shall be effective sixty
(60) days after receipt or at such other time as is agreed by the Company
and the Trustee. The Trustee may be removed at any time by the Company
(with the consent of the Air Line Pilot Association, International
and the International Association of Machinists and Aerospaceworkers)
by an instrument in writing and delivered to the Trustee, which shall be
effective sixty (60) days after receipt or at such other time as is agreed
between the Company and the Trustee.

 

 

8.2 If a vacancy in the office of
trustee of the Trust occurs, the Company (with the consent of the Air Line
Pilot Association, International and the International Association of Machinists
and Aerospace Workers) shall appoint a successor trustee and shall deliver
to the Trustee copies of (a) a written; instrument executed by the Company
appointing such successor, and (b) a written instrument executed by the
successor in which it accepts such appointment. Such instruments shall
indicate their effective date.

 

 

8.3 If the Trustee resigns or is
removed, it shall deliver all assets of the Fund in its possession to a
successor trustee as soon as is reasonably practicable after the settlement
of its account or at such earlier time as shall be agreed on by the Company,
the Trustee and the successor trustee.

 

 

ARTICLE IX

 

 

AMENDMENT AND TERMINATION

9.1 This Agreement may be amended
at anytime and from time to time by the Company (with the consent of the
Air Line Pilot Association, International and the International Association
of Machinists and Aerospace Workers) by a written instrument duly
acknowledged and delivered to the Trustee setting forth the terms of the
amendment; provided that no amendment affecting rights, duties, responsibilities
or liability of the Trustee may be made without the Trustee's consent.
The instrument of amendment shall state to the Trustee that the amendment
does not permit any part of the Fund to be used for or diverted to purposes
other than the exclusive benefit of Participants and their beneficiaries
or the payment of reasonable expenses of administering the Plan and Trust,
as specified in Paragraph 2.2 hereof. The instrument of amendment shall
specify its effective date and amendments may, with the Trustee's consent,
if applicable, be made effective retroactively.

 

 

9.2 If the ESOP Committee certifies
to the Trustee that the Plan is or has been terminated, the Trustee shall
hold and/or dispose of the Fund in accordance with the ESOP Committee's
written instructions. The ESOP Committee shall certify in writing to the
Trustee that the disposition directed: (a) except as provided in Paragraph
2.2, does not result in any part of the Fund being used for or diverted
to purposes other than the exclusive benefit of Participants and their
Beneficiaries and the payment of reasonable expenses (including the repayment
of any outstanding Acquisition Loans) of administering the Plan and Trust,
(b) is in accordance with the applicable provisions of the Code, ERISA
and any other applicable laws, and (c) does not result in a Prohibited
Transaction. If the Plan is terminated with respect to a group of persons
under the Plan, the portion of the Trust attributable to such group shall
be held and disposed of in accordance with the written instructions of
the ESOP Committee which shall be given in conformity with the provisions
of the Plan, the Code and ERISA. The Trustee may, however, reserve such
reasonable sum of money as it deems advisable for payment for the settlement
of its accounts or for payment of taxes that may be assessed on or in respect
of the Fund or the income thereof. This Agreement shall terminate upon
the termination of the Plan as provided herein and the disposition of the
Fund as provided herein.

 

 

ARTICLE X

 

LEVERAGED ACQUISITIONS OF STOCK

10.1 It is specifically contemplated
that the Trust will operate pursuant  to a leveraged employee stock
ownership plan with respect to Part A of the  Plan and that the Trustee
will incur several Acquisition Loans in connection with the acquisition
of Qualifying Employer Securities. Any Acquisition Loan shall meet all
of the requirements necessary to constitute an "exempt loan" within the
meaning of Treasury Regulation Section 54.4975-7(b)(1)(iii) and shall be
used primarily for the benefit of the Participants and their Beneficiaries.
The proceeds of any Acquisition Loan shall be used, within a reasonable
time after the Acquisition Loan is obtained, only to purchase Qualifying
Employer Securities or to repay such Acquisition Loan or a prior Acquisition
Loan. Any Acquisition Loan shall provide for no more than a reasonable
rate of interest and must be without recourse against the Plan and Trust.
The number of years to maturity under the Acquisition Loan must be definitely
ascertainable at all times. The Acquisition Loan may not be payable at
the demand of any person, except in the case of a default. The only assets
of the Trust that may be given as collateral for an Acquisition Loan are
shares of Qualifying Employer Securities acquired with the Acquisition
Loan, shares of Qualifying Employer Securities that were used as collateral
on prior Acquisition Loans repaid with the proceeds of the current Acquisition
Loan and all Qualifying Employer Securities received as consideration pursuant
to a Control Transaction or acquired with proceeds received pursuant to
a Control Transaction. In the event that Qualifying Employer Securities
are used as collateral for an Acquisition Loan, such Qualifying Employer
Securities shall be released from such encumbrance in accordance with the
provisions of the Plan and applicable Treasury Regulations. No person entitled
to payment under an Acquisition Loan shall be entitled to payment from
the Trust other than from shares of Qualifying Employer Securities acquired
with the Acquisition Loan which are collateral for the Acquisition Loan,
Company contributions made under the Plan for the purpose of satisfying
an Acquisition Loan, earnings attributable to such Qualifying Employer
Securities and such Company contributions (other than contributions of
Qualifying Employer Securities), and such other assets, if any, as to which
recourse may be permitted under Section 4975 of the Code. Payments of principal
and interest on an Acquisition Loan shall be made by the Trustee only from
(1) Company contributions (other than contributions of Qualifying Employer
Securities) made under the Plan for the purpose of satisfying such Acquisition
Loan, earnings on such contributions and earnings on shares of Qualifying
Employer Securities acquired with the proceeds of such Acquisition Loan,
including, but not limited to, cash dividends received by the Trust with
respect to such shares of Qualifying Employer Securities, whether or not
allocated to the accounts of Participants (or Beneficiaries), (2) the proceeds
of a subsequent Acquisition Loan made to repay the prior Acquisition Loan,
and/or (3) unless otherwise agreed in the definitive documentation pertaining
to such Acquisition Loan, the proceeds of the sale of any collateralized
shares of Qualifying Employer Securities acquired with the proceeds of
such Acquisition Loan; provided, however, that the Trustee shall in no
event be required to apply such proceeds of sale to repay principal and
interest on an Acquisition Loan if, in the written opinion of counsel to
the Trustee, such action would constitute a Prohibited Transaction or a
breach of the Trustee's fiduciary duties under ERISA. In the event of a
default under an Acquisition Loan, the value of Trust assets transferred
to the lender shall not exceed the amount of the default, provided further
that if the lender is a "party in interest" within the meaning of
ERISA Section 3(14) or a "disqualified person" within the meaning of Section
4975(e)(2) of the Code, a transfer of Trust assets upon default shall be
made only if, and to the extent of, the Trust's failure to meet the Acquisition
Loan's payment schedule.

 

 

ARTICLE XI

 

 

MISCELLANEOUS

11.1 This Agreement shall be binding
upon, and the powers granted to the Company and the Trustee, respectively,
shall be exercisable by, the respective successors and assigns of the Company
and the Trustee. Any corporation which shall, by merger, consolidation,
purchase or otherwise, succeed to substantially all the trust business
of the Trustee shall, upon such succession and without any appointment
or other action by the Company, be and become successor trustee hereunder,
upon notification to the Company.

 

 

11.2 No right or claim in or to the
Fund or any assets thereof shall be subject in any manner to anticipation,
alienation, sale, transfer, assignment, pledge, encumbrance or charge,
and any attempt to so anticipate, alienate, sell, transfer, assign, pledge,
encumber or charge shall be void and shall not be recognized by the Trustee,
except to such extent as may be legally required (e.g., as otherwise provided
in the Plan with respect to qualified domestic relations orders). No such
right or claim shall be liable for or subject to the debts, contracts,
liabilities, engagements or torts of the person entitled thereto.

 

 

11.3 This Agreement shall be administered,
construed and enforced in accordance with ERISA, and to the extent not
governed by ERISA, in accordance with the laws of the Commonwealth of Massachusetts.

 

 

11.4 One or more of the Company's
Affiliates may, with the approval of the Board of Directors, by resolution
of its own board of directors adopt the Trust if such subsidiary shall
have adopted the Plan or any part thereof. Each such Affiliate which has
adopted this Trust shall be deemed a party to this Agreement and all references
herein to "Company" shall be deemed as to include such Related Company,
except as the context may otherwise require.

 

 

11.5 For all purposes of the Plan
and Trust, all valuations of Stock which is not readily tradable on an
established securities market will be made by an "independent appraiser"
within the meaning of Section 401(a)(28)(C) of the Code.

 

 

11.6 Headings of Articles are inserted
for convenience of reference. They are not part of this Agreement and shall
not be considered in construing it.

 

 

11.7 This Agreement may be executed
in any number of counterparts, each of which shall be considered an original
even through no others are produced.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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IN WITNESS WHEREOF, the Company and
the Trustee have caused this Agreement to be executed by their duly authorized
officers and their respective corporate seals to be hereunto affixed as
of the day and year first above written.

 

 

 

 
	Attest:	UAL CORPORATION
	 	 
	BY: /s/Francesca
M. Maher	BY: /s/Joseph
R. O'Gorman
	TITLE: Vice
President	TITLE: Executive
Vice President
	 	 
	Attest: 	STATE STREET
BANK AND TRUST 
	 	COMPANY
	 	 
	BY: /s/Denise
R. Courcy	BY: Kelly
Driscoll
	TITLE: Assistant
Vice President	TITLE: Vice
President
	      
and Associate Counsel	 

</HTML>

</TEXT>

</DOCUMENT>UAL CORPORATION

<DOCUMENT>

<TYPE> EX-10.17

<TEXT>

<HTML> 

Exhibit 10.17

 

 

UAL CORPORATION

SUPPLEMENTAL ESOP

 

 

Effective as of July 12, 1994

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Table of Contents

                                         
                                          
                                       
Page

ARTICLE 1 Scope of Plan and Definitions                                   
                       
1

ARTICLE 2 Participation and Allocations                                   
                        
4

ARTICLE 3 Payment of Benefits                                    
                                   
12

ARTICLE 4 Administration of Plan                                    
                               
15

ARTICLE 5 Amendment and Termination                                   
                     
16

ARTICLE 6 Miscellaneous Provisions                                   
                           
16

 

 

UAL CORPORATION

SUPPLEMENTAL ESOP

Effective as of July 12, 1994

 

 

 

ARTICLE 1

Scope of Plan and Definitions

1.1     Purpose and Scope of Plan

1.2     Terms Defined in the ESOP. For all purposes
of this Plan, capitalized terms, unless defined herein, shall have the
meanings specified in the ESOP, unless a different meaning is plainly required
by the context.

1.3     Definitions. As used in the Plan, the following
capitalized terms have the meanings set forth below, unless a different
meaning is plainly required by the context:

(a) "Account" means bookkeeping account (including a Share Subaccount
and a Cash Subaccount) maintained by the Company to record a Participant's
interest in the Plan (and to the extent applicable, the Supplemental Trust)
that is credited with Convertible Shares, Voting Shares, Common Stock and
other amounts as provided in Article Two.

(b) "Additional Shares" means the number of additional shares, if any,
of ESOP Preferred Stock, Convertible Shares and Voting Shares to be issued
or credited by the Company in accordance with Sections 1.6 and 1.10 of
the Recapitalization Agreement. Any reference herein to Additional Shares
shall only be applicable when, if and to the extent that Additional Shares
are determined to be issuable in accordance with Sections 1.6 and 1.10
of the Recapitalization Agreement.

(c) "Beneficiary" means the beneficiary or beneficiaries designated
by a Participant under the ESOP, unless the Participant selects a different
Beneficiary in accordance with Section 3.4 hereunder.

(d) "Committee" means the ESOP Committee, excluding the members appointed
by the IAM.

(e) "Common Stock" means the common stock of the Company, par value
$.O1 per share or non-equity units that are treated as fictional book-entry
shares of Common Stock if allocated hereunder.

(f) "Company" means UAL Corporation and any successor corporation or
entity to the Company by merger, consolidation or otherwise.

(g) "Compensation" means compensation as defined in the ESOP modified
by ignoring both (i) the limitations on compensation under Section 401(a)(17)
of the Code and (ii) the ESOP rule that limits compensation to four times
the dollar limit under Code Section 415(c)(1)(A).

(h) "Convertible Shares" means the Class 2 ESOP Convertible Preferred
Stock of the Company or non-equity units that are treated as fictional
book-entry Convertible Shares if allocated hereunder.

(i) "Effective Date" means July 12, 1994.

(j) "Eligible Employee" means an "eligible employee" as defined in ESOP,
provided, that, except for purposes of Sections 2.3(a)(i) and 2.4(f), no
member of the IAM Employee Group shall be an Eligible Employee.

(k) "ESOP" means the UAL Corporation Employee Stock Ownership Plan (together
with its related trust), effective July 12, 1994, as such plan and trust
may be amended from time to time.

(1) "ESOP Preferred Stock" means the Class 1 ESOP Convertible Preferred
Stock of the Company.

(m) "ESOP Participant" means any participant under the ESOP.

(n) "Fair Market Value" means, for any
date, the closing price of the Common Stock on that date on the New York
Stock Exchange as reported on the Composite Tape and published in the Wall
Street Journal for that date, or, if there is no trading of the Common
Stock
on the date in question, then the closing price of the Common Stock, so
reported and published, on the next preceding date on which there was trading
in the Common Stock.

(o) "Fixed Dividend" shall mean the fixed dividend as defined in Section
3.1 (b) of the ESOP.

(p) "Highly Compensated Participant" means each Participant whose Compensation
for the Plan Year exceeds the limitation on compensation set forth in section
401(a)(17) of the Code for that Plan Year. Once a Participant becomes a
Highly Compensated Participant, he shall remain a Highly Compensated Participant
even if his Compensation in a subsequent Plan Year is less than the applicable
section 401(a)(17) limit for that Plan Year.

(q) "Participant" means an ESOP Participant who has an Account under
this Plan, provided, that, except for purposes of Sections 2.3(a)(i) and
2.4(f), no member of the IAM Employee Group shall be a Participant.

(r) "Phantom Suspense Account" means a single bookkeeping account maintained
by the Company pursuant to the terms of this Plan and the ESOP (Part B)
which operates in a similar fashion as the Loan Suspense Account.

(s) "Plan" means the UAL Corporation Supplemental ESOP as set forth
herein, effective as of July 12, 1994, as amended from time to time.

(t) "Qualified Plans" means the ESOP and other tax-qualified plans maintained
by the Company or one of its Affiliates in which any ESOP Participant participates.

(u) "Release Fraction" means for any Plan Year, the number of months
(or fractions thereof) in that Plan Year divided by the number of months
(including fractional months) from the beginning of the Plan Year until
the end of the 69-month period commencing on the Effective Date. For this
purpose, the last Plan Year shall end at the end of the 69-month period
commencing on the Effective Date.

(v) "Supplemental Trust" means the UAL Corporation Supplemental ESOP
Trust and the various trusts created thereby.

(w) "Tax Limitations" means (i) the limits on annual additions under
section 415 of the Code, including the limitation set forth in section
415(c)(6) of the Code applicable to employee stock ownership plans and
the combined limits set forth in section 415(e) of the Code, (ii) with
respect to Highly Compensated Participants only, the limitation on compensation
under section 401(a)(17) of the Code, and/or (iii) the limitations imposed
by section 401(a)(4) of the Code.

(x) "Trustee" means the trustee or trustees from time to time in office
under the Supplemental Trust.

(y) "Voting Shares" means (i) with respect to Participants who are members
of the ALPA Employee Group, the Class P ESOP Voting Junior Preferred Stock
of the Company ("Class P Voting Shares"), (ii) with respect to Participants
who are members of the IAM Employee Group, the Class M Voting Junior Preferred
Stock of the Company ("Class M Voting Shares"), and (iii) with respect
to Participants who are members of the Management and Salaried Employee
Group, the Class S ESOP Voting Junior Preferred Stock of the Company ("Class
S Voting Shares").

(z) "Valuation Date" shall be defined in accordance with the ESOP, provided
that the date of the Company's dissolution, liquidation or Insolvency (as
defined in the Supplemental Trust) shall also be a Valuation Date for purposes
of Article Three.

1.4     Other Provisions. The terms defined in Sections
1.2 and 1.3 of the Plan shall apply equally to both singular and plural.
The masculine pronoun, whenever used, shall include the feminine. When
used in the Plan, the words "hereof," "herein" and "hereunder" and words
of similar import shall refer to the Plan as a whole and not to any particular
provision of the Plan, unless otherwise specified.

1.5     Special Rules. The following provisions
of the ESOP shall be hereby incorporated into the Plan, with such modifications
as are appropriate, provided that such provisions shall be construed in
a manner consistent with, and subject to limitation by, the purpose and
scope of the Plan (as set forth in Section 1. l) and the Supplemental Trust:

(a) Section 2.3 of the ESOP;
(b) Section 3.4 of the ESOP;

(c) Section 4.1 of the ESOP (except as otherwise provided in the Plan
and the Supplemental Trust);

(d) Section 4.2 of the ESOP;

(e) Section 4.4 of the ESOP; and

(f) Section 7.10 of the ESOP.

 

 

 

 

 

 

 

 

 

 

ARTICLE 2
Participation and Allocations

2.1     Participation. An Eligible Employee shall
become a Participant on the Valuation Date when an Account on his behalf
is first credited with Voting Shares or Convertible Shares under this Plan.
Notwithstanding any other provision of this Plan to the contrary, except
for purposes of Sections 2.3(a)(i) and 2.4(f), no ESOP Participant who
is a member of the IAM Employee Group shall become a Participant hereunder
or receive any credits, allocations or benefits pursuant to this Plan.

2.2     Number of Voting Shares and Convertible
Shares Released Each Valuation Date.

(a) The maximum number of Convertible Shares issued under this Plan
and the ESOP (Part B) shall be 3,862,063 and the maximum number of Voting
Shares issued under this Plan and the ESOP (Part B) shall be 17,675,345,
consisting of 8,171,312 Class P Voting Shares, 6,562,856 Class M Voting
Shares, and 2,941,177 Class S Voting Shares; provided that, on the December
31, 1995 Valuation Date (and after the allocations described in Section
2.4(f) are completed), the maximum number of Convertible Shares and Voting
Shares shall be increased to reflect the number of Additional Shares (other
than shares of ESOP Preferred Stock) determined in accordance with Section
1.10 of the Recapitalization Agreement. Said Voting Shares shall be contributed
by the Company, from time to time, to the Supplemental Trust and ESOP (Part
B).

(b) On the Effective Date, the Phantom Suspense Account shall be credited
with the number of Voting Shares and Convertible Shares provided in subsection
(a) above.

(c) As of the Valuation Date for each Plan Year, the total number of
Voting Shares released from the Phantom Suspense Account shall equal the
number of unreleased Voting Shares held in the Phantom Suspense Account
immediately before such release multiplied by the Release Fraction for
that Plan Year.

(d) As of the Valuation Date for each Plan Year, the total number of
Convertible Shares released from the Phantom Suspense Account shall equal
the number of unreleased Convertible Shares held in the Phantom Suspense
Account immediately before such release multiplied by the Release Fraction
for that Plan Year.

(e) As of the Valuation Date for each Plan Year, the total number of
shares of Company Stock other than Voting Shares and Convertible Shares,
(for example, shares of Common Stock received upon the conversion of Convertible
Shares) released from the Phantom Suspense Account shall equal the number
of unreleased shares of such Company Stock held in the Phantom Suspense
Account immediately before such release multiplied by the Release Fraction
for that Plan Year.

2.3     General Allocation Provisions.

a) As of each Valuation Date, after the allocations pursuant to Sections
2.5(c) and (d), allocations of Voting Shares and Convertible Shares and
Common Stock released from the Phantom Suspense Account shall be made in
the following order:

(i) Section 5.4(c)(i) of the ESOP generally provides that, subject
to the Tax Limitations, one Voting Share released from the Phantom Suspense
Account shall be contributed by the Company to ESOP (Part B) and allocated
to the Participant's account thereunder for each share of ESOP Preferred
Stock allocated to that Participant under ESOP (Part A) on that Valuation
Date. To the extent that any Voting Shares cannot be allocated (due to
the Tax Limitations) to the Participant's account under ESOP (Part B) pursuant
to the foregoing provisions of ESOP (Part B), Voting Shares released from
the Phantom Suspense Account shall be contributed to the Supplemental Trust
by the Company and allocated to that Participant's Account hereunder.
(ii) Second, each Participant shall receive an allocation of Voting
Shares and Convertible Shares pursuant to Section 2.4; and

(iii) Third, Voting Shares, Convertible Shares and Common Stock allocated
to each Participant's Account hereunder shall be reduced pursuant to Section
2.7.

(b) The Voting Shares allocated under this Plan (and contributed to the
Supplemental Trust) or contributed to the ESOP (Part B) pursuant
to the terms thereof shall be of the appropriate class for each Participant.

(c) Each Convertible Share that is released from the Phantom Suspense
Account shall be either (i) in accordance with the terms of ESOP (Part
B),
contributed by the Company (or transferred from the Supplemental Trust)
to ESOP (Part B), or (ii) allocated to Participants' Accounts hereunder.
Each Voting Share released from the Phantom Suspense Account shall be either
(i) in accordance with the terms of ESOP (Part B), contributed by the
Company directly to ESOP (Part B) or (ii) allocated to Participants' Accounts
hereunder (in which case the Company shall contribute a Voting Share to
the Supplemental Trust).

2.4     Allocation of Convertible Shares and Voting
Shares to Individual Accounts. On each Valuation Date, after the allocations
of Voting Shares described in Section 2.3(a)(i) have been made, the remaining
Voting Shares and Convertible Shares released from the Phantom Suspense
Account shall be allocated, on an Employee Group-by-Employee Group basis,
as follows:

(a) For each ESOP Participant, a "Hypothetical Share Number" shall be
calculated for the Valuation Date. This number shall equal the number of
shares of ESOP Preferred Stock that would have been allocated to the ESOP
Participant under ESOP (Part A) on such Valuation Date if:

(i) all the shares of Preferred Stock to be issued pursuant to the
Recapitalization Agreement (including, with respect to Valuation Dates
occurring on or after December 31, 1995 and after the allocation in subsection
(f) below, any Additional Shares of Preferred Stock issued or to be issued)
had been (I) purchased by the Trust under a single loan on the Effective
Date and held under the Loan Suspense Account pursuant to ESOP (Part A),
and (II) in the case of such shares of Preferred Stock which are Convertible
Shares, considered ESOP Preferred Stock having the same fair market value
as the ESOP Preferred Stock that was allocated under ESOP (Part A); provided,
however, that such Convertible Shares shall not, except as provided in
clause (v) below, be considered to bear any dividends;
(ii) the Convertible Shares referred to in the immediately preceding
clause (i) were released under ESOP (Part A) ratably over the 69 months
starting on the Effective Date;

(iii) Section 5.4(a)(i)(A) of the ESOP were applied by allocating the
ESOP Preferred Stock (including the Convertible Shares described in clause
(i) above) among the Employee Groups as follows: ALPA Employee Group--46.23
% , IAM Employee Group--37.13 % , and Management and Salaried Employee
Group--16.64%;

(iv) allocations under the ESOP (Part A) were made (A) without regard
to the Tax Limitations, (B) without regard to clauses (ii), (iv), (v),
(vi) or (vii) of 5.4(a) of the ESOP and (C) were based on Compensation
rather than the definition of compensation in the ESOP; and

(v) each Convertible Share which was in fact allocated on a prior Valuation
Date to Participants' or Beneficiaries' Accounts hereunder or contributed
to ESOP (Part B) and allocated to Participants' or Beneficiaries' accounts
thereunder were, after the date of such allocation, ESOP Preferred Stock
held by ESOP (Part A) bearing the same Fixed Dividend (but not any other
dividends) as the ESOP Preferred Stock that was allocated under ESOP (Part
A). By way of illustration, assume a member of the ALPA Employee Group
has a total of 130 Convertible Shares allocated to his Accounts hereunder
and 70 Convertible Shares allocated to his accounts under ESOP (Part B).
Assume further that each share of ESOP Preferred Stock allocated under
the ESOP (Part A) has a value of $100 and pays an $8 Fixed Dividend, no
dividends are paid on the Common Stock, and that each Convertible Share
has a $75 value. For purposes of making the allocations under this clause
(v), such individual shall be treated as having received a dividend of
$1600 with respect to the 200 Convertible Shares allocated hereunder and
under Part B. For purposes of calculating the Hypothetical Share Number,
that individual shall receive an allocation of 16 Convertible Shares to
make up for such dividend, notwithstanding the fact that the value of the
Convertible Shares is $75/share.

(b) The "Actual Share Number" for each ESOP Participant for a Valuation
Date shall equal the actual number of shares of ESOP Preferred Stock that
are allocated to such Participant under ESOP (Part A) on that Valuation
Date.

(c) For each ESOP Participant, the difference, if any, between the Hypothetical
Share Number and the Actual Share Number shall be referred to as the Tentative
Allocation; provided, however, that, except for purposes of subsection
(f), the Tentative Allocation for any member of the IAM Employee Group
shall be zero. If the sum of the Tentative Allocations (ignoring negative
Tentative Allocations) for all Participants in an Employee Group exceeds
the number of Convertible Shares released from the Phantom Suspense Account
for the Valuation Date under Section 2.2 to all such Participants' Accounts
(for that Employee Group), each Tentative Allocation for Participants of
that Employee Group shall be proportionately reduced.

(d) For each ESOP Participant, the number of Convertible Shares and
Voting Shares to be transferred from the Supplemental Trust or contributed
by the Company to ESOP (Part B) pursuant to the terms of ESOP (Part B)
(excluding the Voting Shares described in Section 2.3(a)(i) and Section
2.7) shall be the same and shall equal the least of the following:

(i) the maximum number, if any, of Convertible Shares and Voting Shares
that can be allocated to the ESOP Participant on the Valuation Date under
the ESOP (Part B) without causing ESOP or any other Qualified Plan
to violate Code Section 415 or Code Section 401(a)(4) (if applicable);
(ii) the Tentative Allocation, if any; or

(iii) the excess of the Hypothetical Share Number (calculated for this
purpose only by applying Section 401(x)(17) of the Code) over the Actual
Share Number, if any. The Hypothetical Share Number described in this clause
(iii) shall be determined by recalculating the allocations made on the
current and all prior Valuation Dates by assuming the Participant's Compensation
for each Plan Year had been limited to the amounts then allowed under Code
Section 401(x)(17). Accordingly, for purposes of calculating the Hypothetical
Share Number under this clause (iii), (A) the Participants' Compensation
in the current Plan Year shall be limited to the amount provided by Code
Section 401(x)(17) and (B) the amount of dividends allocated to each ESOP
Participant's Account during the Plan Year shall be calculated by assuming
the allocation of the ESOP Preferred Stock made on earlier Valuation Dates
was also based on Compensation, as limited by the Code Section 401(x)(17)
limit then in effect.

Such number shall be referred to as the "Part B Number."

(e) The number of Convertible Shares and Voting Shares allocated to each
Participant's Account on a Valuation Date shall equal the excess, if any,
of the Tentative Allocation for that Participant over the Part B Number
for that Participant, as described in subsection (d). All such Convertible
Shares and Voting Shares shall be allocated to the Participant's Account
as of such Valuation Date.

(f) Prior to the December 31, 1995 Valuation Date, the aggregate Hypothetical
Share Numbers for all Participants for the 1994 Plan Year shall be retroactively
increased by an additional number equal to X multiplied by Y; where X is
the total number of shares of Preferred Stock to be issued as Additional
Shares and Y is the Release Fraction for December 31, 1994. Such shares
shall be divided among the Employee Groups in accordance with Section 2.4(a)(iii)
and allocated to Participants based upon 1994 data (that is, 1994 Compensation
and Wage Investments, as applicable). The excess of such new Hypothetical
Share Number for the 1994 Plan Year over the Hypothetical Share Number
previously determined for 1994 shall be credited hereunder or allocated
under ESOP (Part B) in accordance with subsections (d) and (e) above, provided
that the number in (d)(i) shall be calculated and credited as if the contributions
were attributable to 1995, rather than 1994, unless the additional aggregate
Part B Number shares are contributed to the ESOP no later than September
15, 1995. The calculations required by this clause (f) shall be performed
prior to calculating the regular allocations for the 1995 year. The additional
Convertible Shares credited pursuant to this clause (f) shall, for all
purposes, including Section 2.4(a)(v), be allocated as of December 31,
1994.

(g) To the extent any interpretive issues arise in calculating Tentative
Allocations, such issues shall be resolved, to the extent possible, by
effectuating the purpose of the Plan, as set forth in Section 1.1; provided,
however, that no such resolution shall increase the number of Voting Shares
or Convertible Shares that may be allocated under the Plan and the ESOP
(Part B). It is also intended that, for each Convertible Share allocated
to a Participant's Account under this Plan, a Voting Share shall also be
allocated to the Participant's Account; for each Convertible Share or share
of ESOP Preferred Stock allocated to an ESOP Participant under the ESOP
(Part A and Part B), a Voting Share shall be contributed to the
ESOP (Part B) and allocated to the ESOP Participant's account under ESOP
(Part B). To the extent that any shares of Company Stock are converted
into shares of Common Stock prior to the end of the Wage Investment Period,
an appropriate number of shares of Common Stock will be contributed (if
applicable) and allocated hereunder in lieu of the Company Stock that would
have been contributed and/or allocated hereunder and, if appropriate, the
number of Convertible Shares and/or ESOP Preferred Stock shares set forth
in various places in this Plan shall be revised; provided, however, except
to the extent Voting Shares are converted into shares of Common Stock,
the calculation of the number of Voting Shares to be contributed and allocated
shall continue as if no shares of Company Stock had been converted.

2.5     Accounts.

(a) Participants' Accounts. The Company shall establish Accounts for
each Participant to record the interest of each Participant under the Plan
and, with respect to Voting Shares (and in the circumstances described
in Sections 6.1 (e) or 6.9(b) hereof, the Convertible Shares), under the
Supplemental Trust. Subject to Section 2.7, Voting Shares allocated to
Participants' Accounts under this Plan shall be contributed to and held
in the Supplemental Trust.

(b) Voting Shares and Convertible Shares. Voting Shares and Convertible
Shares shall be credited to each Participant's Share Subaccount under the
Plan in accordance with Section 2.4.

(c) Cash Dividends and Other Cash Distributions.

(i) If the Company pays a cash dividend or makes a cash distribution
with respect to its Convertible Shares or Common Stock, each Participant's
Account shall be credited with an amount equal to the dividends and distributions
that would have been payable with respect to the Convertible Shares and
Common Stock credited to his Account on the applicable record date had
such shares been outstanding.
(ii) In addition, if the Company pays a cash dividend or makes a cash
distribution with respect to Convertible Shares, an amount, equal to the
dividends or distribution that would have been paid on the number of Convertible
Shares then held in the Phantom Suspense Account had such shares been previously
issued, shall be credited to Participants' Accounts, pro rata, according
to the sum of the number of the Convertible Shares allocated to each Participant's
Account hereunder and to each ESOP Participant's account under ESOP (Part
B) on the applicable record date.

(iii) Amounts credited under clauses (i) and (ii) above shall be deemed
immediately invested in Common Stock. The aggregate number of shares of
Common Stock deemed acquired under the Supplemental Plan with such dividends
or distributions shall equal the aggregate deemed dividend or distribution
under clauses (i) and (ii) divided by the Fair Market Value of the Common
Stock on the applicable payment date. Such Common Stock shall be allocated
to Participants' Share Subaccounts hereunder, pro rata, based on
the dollar amounts credited under clauses (i) and (ii) above to the Participants'
Accounts hereunder. The dollar amounts credited to Participants'
Accounts under clauses (i) and (ii) above shall be debited accordingly.

(d) Other Income Adjustments. All other income (net of expenses), gains
and losses (whether or not realized) on investments in the Supplemental
Trust (excluding Company Stock) that are not used to purchase additional
shares of Common Stock by a Valuation Date shall be allocated to Participants'
Cash Subaccounts as of such Valuation Date, pro rata, based on Account
balances. Such amounts shall be deemed reinvested in Common Stock in accordance
with the principles of Section 2.5(c)(iii) based on the Fair Market Value
of the Common Stock on the Valuation Date.

(e) Statements. Each Participant shall receive a statement of the balance
in his Account at least annually.

(f) Construction. References hereunder to the "issuance" of shares shall
be understood, where appropriate, as references to the crediting of such
shares on a book-entry basis even if not explicitly so stated. The book-entry
accounts to be maintained under this Plan are intended to record (on a
"deemed" basis) the economic equivalent of the benefits that Participants
would have accumulated if the relevant shares of stock had been credited
to actual accounts in a non-taxable trust for their benefit under a defined
contribution plan (but without duplication of benefits provided through
another mechanism). Accordingly, appropriate book-entries and adjustments
shall be made to equitably record the receipt or distribution of securities,
property or cash (to the extent not specifically addressed herein) that
would have occurred had the actual shares been maintained in a trusteed
account and ultimately distributed therefrom. This subsection (f) shall
not be construed as authorizing the creation of other mechanisms for the
provision of the benefits referred to in this subsection.

2.6     Vesting. Except as described in Section
2.7, each Participant shall be one hundred percent vested in the value
of his Accounts at all times.

2.7     Flowback.

(a) Beginning in the Plan Year after an ESOP Participant becomes a Participant
and continuing each Plan Year thereafter, the number of Voting Shares,
Convertible Shares and Common Stock allocated to his Account shall be reduced
in accordance with this Section 2.7. On the last Valuation Date of each
such Plan Year, the Participant's Voting Shares, Convertible Shares and
Common Stock Shares (including any such shares allocated in a prior Plan
Year due to limitations under Code section 401(a)(17)) and Common Stock
Shares shall be reduced:

(i) First, by the number, if any, of Voting Shares allocated to his
Account hereunder in excess of the number of Convertible Shares allocated
hereunder to the extent such number may be transferred from the Supplemental
Trust to ESOP (Part B) hereunder without disqualifying the ESOP or any
other Qualified Plan; provided, however, that the amount transferred may
include any such shares that were not previously contributed or transferred
to ESOP (Part B) because of the limitations of Code section 401(a)(17);
(ii) Second, by the maximum number of Convertible Shares and Voting
Shares (such numbers to be the same) that may be contributed by the Company
(or transferred from the Supplemental Trust) to ESOP (Part B) without disqualifying
the ESOP or any other Qualified Plan; provided, however, that the amount
contributed or transferred may include any such shares that were not previously
contributed or transferred to ESOP (Part B) because of the limitations
of Code section 401(a)(17); and

(iii) Third, by the maximum number of shares of Common Stock that may
be transferred from the Supplemental Trust or contributed by the Company
to ESOP (Part B) without disqualifying the ESOP or any other Qualified
Plan; provided, however, that the amount transferred or contributed may
include any shares that were not previously contributed or transferred
to ESOP (Part B) because of the limitations of Code section 401(a)(17).

The reductions described in the preceding sentence shall not include any
Voting Shares, Convertible Shares or Common Stock allocated in the current
Plan Year.

(b) As soon as practicable after the end of the Plan Year (but before
the time prescribed for filing the Employer's federal income tax return
for that Plan Year), the Company shall direct the Trustee to transfer from
the Supplemental Trust or contribute to the ESOP (Part B) that number of
Voting Shares, Convertible Shares and Common Stock equal to the sum of
the applicable reductions calculated for each Participant under this Section
2.7.

2.8     Voting Shares and Convertible Shares Contributed
or Transferred to the ESOP (Part B) or Supplemental Trust.

 

 

ARTICLE 3

Payment of Benefits

3.1     Commencement and Form of Payment.

(a) Notwithstanding any provision of this Plan to the contrary, no Participant
shall receive a distribution of any Voting Shares or Convertible Shares.
Prior to any distribution, all Voting Shares and Convertible Shares held
in the Participant's Account to be distributed shall be deemed converted
into Common Stock (and cash for any fractional share).

(b) Unless the Participant elects otherwise,

(i) as soon as practicable following the Valuation Date coinciding
with or next following the later of the Participant's termination of employment
with the Employer and its Affiliates and December 31, 1995, the Company
shall pay to such Participant (or, if such Participant is not living at
the time for payment, to such Participant's Beneficiary) the value of the
Participant's vested Account; and
(ii) payments of a Participant's Account shall be trade in a lump sum
in actual shares of Common Stock and cash. The number of shares of Common
Stock distributed shall equal the number of shares of Common Stock credited
to the Participant's Account (after converting the Convertible Shares and
Voting Shares allocated to the Participant's Account). In addition, the
Participant shall receive cash for any fractional share of Common Stock
(after the above conversions and based on the Fair Market Value of the
Common Stock on the last day of the month prior to the distribution) and
the value of the Participant's Cash Subaccount credited to the Participant's
Account as of the Valuation Date described in clause (i).

(c) The Participant (but not a Beneficiary) may make, modify or revoke
one or more of the following elections (on a form provided by the ESOP
Committee):

(i) an election that, if the Participant terminates employment prior
to the end of the Wage Investment Period, distributions shall commence
as soon as practicable after the end of the Wage Investment Period;
(ii) an election to receive payments in a series of five substantially
equal annual installments (each such installment to be paid by converting
the same proportion of Convertible Shares, Voting Shares and Common Stock
then held in the Participant's Account);

(iii) an election to receive the entire distribution in shares of Common
Stock (except for fractional shares), in which case the Company shall apply
an amount equal to the Cash Subaccount (net of all costs involved in such
purchase) to the purchase of Common Stock in the open market. The number
of shares of Common Stock distributed shall equal (A) the number of shares
described in Section 3.1(b)(ii) plus (B) the number of shares of Common
Stock that can be so acquired with amounts described in the preceding sentence;
and

(iv) an election to receive the entire distribution in cash, in which
case the Company may sell the number of shares of Common Stock that would
have been distributed to the Participant pursuant to Section 3.1(b)(ii)
if no such election had been made. The distribution shall equal the value
of the Cash Subaccount plus the proceeds (net of selling expenses) realized
(or that would have been realized had the sale been made) from the sale
of the shares of Common Stock described in the preceding sentence.

(v) Notwithstanding clauses (i)-(iv) above, any such election (or modification
or revocation thereof) shall be void unless made at least one year prior
to the Participant's termination of employment with the Employer (and its
Affiliates) or prior to January 1, 1995.

(d) The Participant may also make, modify or revoke an election (on a form
provided by the Committee) that, in the event the Participant dies before
benefits have commenced, benefits shall be paid to the Participant's Beneficiary
in accordance with clauses (i), (ii), (iii) and/or (iv) of subsection (c).
Any such election (or modification or revocation thereof) may be made at
any time by the Participant. A Beneficiary may not make, modify or revoke
any such election.

3.2     No Loans, In-service Payments or Withdrawals.
No Participant shall be allowed to borrow from the Plan. No withdrawal
or payment of benefits shall be allowed before a Participant terminates
employment with the Company and its Affiliates.

3.3     No Diversification Rights. A Participant
may not direct the Trustee as to the investment of his Account, even if
the Participant is permitted to diversify his account under the ESOP pursuant
to Section 7.1 of the ESOP.

3.4     Beneficiary Designation.

(a) Unless a Participant designates a different Beneficiary, in accordance
with the provisions of subsection (b), his Beneficiary shall be his beneficiary
under the ESOP.

(b) In order to designate a Beneficiary other than the beneficiary designated
under the ESOP, the Participant shall sign a form furnished by the Committee,
designating any legal or natural person or persons (who may be designated
contingently or successively) to whom his benefits are to be paid if he
dies before he receives all of his benefits; provided, however, that if
a married Participant designates a Beneficiary other than his spouse, his
spouse must consent in writing to such designation and acknowledge in writing
the effect of such designation, and such consent and acknowledgement must
be witnessed by a notary public. Any designation by an unmarried Participant
shall be rendered ineffective by any subsequent marriage and any consent
of a spouse shall be effective only as to that spouse. A Beneficiary designation
form will be effective only when the signed form is filed with the Committee
while the Participant is alive and will cancel all Beneficiary designation
forms signed earlier. If a deceased Participant fails to designate a Beneficiary
as provided above (or if the designated Beneficiary dies before the Participant
or before receiving complete payment of the Participant's benefits), the
Company shall pay and, if applicable, the ESOP Committee shall direct the
Trustee to pay the Participant's benefits as follows:

(i) first, to the surviving spouse of the Participant, if any;
(ii) second, to the children (including any adopted children) of the
Participant, per stirpes; and

(iii) third, if the Participant leaves no surviving spouse or has no
descendants pursuant to paragraph (b) above, to the estate of the last
to die of the Participant or his designated Beneficiary.

Upon the dissolution of marriage of a Participant, any designation of
the Participant's former spouse as a Beneficiary shall be treated as though
the Participant's former spouse had predeceased the Participant, unless
(i) the Participant executes another Beneficiary designation that complies
with this Section 3.4 and that clearly names such former spouse as a Beneficiary,
or (ii) a court order presented to the Committee prior to distribution
on behalf of the Participant explicitly requires the Participant to continue
to maintain the former spouse as the Beneficiary. In any case in which
the Participant's former spouse is treated under the Participant's Beneficiary
designation as having predeceased the Participant, no heirs or other beneficiaries
of the former spouse shall receive benefits from the Plan as a Beneficiary
of the Participant except as provided otherwise in the Participant's Beneficiary
designation.

3.5     Facility of Payment.

(a) Subject to subsection (b), if, in the opinion of the Committee,
a Participant or Beneficiary is under a legal disability or is in any way
incapacitated so as to be unable to manage his financial affairs, until
claim is made by a conservator or other person legally charged with the
care of his person or of his estate, the Committee may (but shall not be
required to) direct the Company to make payment to a relative or friend
of such person for his benefit. Thereafter, any benefits under the Plan
to which such Participant or Beneficiary is entitled shall be paid to such
conservator or other person legally charged with the care of his person
or his estate.

(b) In the event any amount is payable under the Plan to a minor, payment
shall not be made to the minor, but instead shall be paid (i) to that person's
then living parent(s) to act as custodian, (ii) if that person's parents
are then divorced, and one parent is the sole custodial parent, to such
custodial parent, or (iii) if no parent of that person is then living,
to a custodian selected by the Committee to hold the funds for the minor
under the Uniform Transfers or Gifts to Minors Act in effect in the jurisdiction
in which the minor resides. If no parent is living and the Committee decides
not to select another custodian to hold the funds for the minor, payment
shall be made to the duly appointed and currently acting guardian of the
estate for the minor or, if no guardian of the estate for the minor is
duly appointed and currently acting within 60 days after the date the amount
becomes payable, payment shall be deposited with the court having jurisdiction
over the estate of the minor.

(c) Any payment under this Section 3.5 shall discharge, to that extent,
the obligation of the Company and the Employer to pay benefits under the
Plan with respect to such Participant, Beneficiary or minor.

 

 

ARTICLE 4

Administration of Plan

4.1     General. The Company shall be the administrator
of the Plan. The Committee shall have the rights, duties and obligations
set forth herein.

4.2     Incorporation of ESOP Provisions. Section
11 (excluding Section 11.1) and all of Section 12 of the ESOP are incorporated
by reference, with such modifications as are appropriate; provided, however,
that:

(a) The Committee shall consist of four members: three members appointed
by ALPA and one member appointed by the Company.

(b) All references to the IAM Committee members appointed by the IAM
or the IAM Employee Group shall be deleted.

(c) A quorum shall consist of at least three members, including the
member appointed by the Company.

(d) The proviso to the first sentence of Section 11.3 shall not be incorporated
by reference.

(e) The last sentence of Section 11.7 shall not be incorporated by reference;
provided that the Company shall use its reasonable best efforts to cover
the ALPA and, if applicable, IAM Committee members (if such members are
employees) with liability insurance coverage for their activities as Committee
members comparable to any insurance provided for the Salaried and Management
Employee Group Committee member.

(f) All meetings of the Committee shall be held on the same day as a
meeting of the ESOP Committee under the ESOP.

(g) No expenses or indemnities shall be incurred or paid hereunder which
are duplicative of expenses or indemnities incurred or paid pursuant to
the ESOP.

(h) Except with respect to matters solely relating to this Plan, the
Committee will not employ any person or delegate any matter to any person
who has not been employed by the ESOP Committee under the ESOP.

(i) Notwithstanding the above and the definition of "Committee", clauses
(a), (b) and (c) shall be disregarded with respect to any issue involving
Voting Shares allocated to the IAM Employee Group under this Plan if any
Voting Shares are allocated to an Account of a Participant who is a member
of the IAM Employee Group.

4.3     Decisions of Committee under ESOP. Notwithstanding
any provision of this Plan any matter (including any decision by the Committee
with respect to an appeal of a claim of a Participant (or Beneficiary))
under the ESOP shall be binding hereunder to the extent the matter (or
claim) is substantially the same as a matter (or claim made by the same
Participant (or Beneficiary)) to be decided hereunder.

 

 

ARTICLE 5

Amendment and Termination

5.1     Amendment. While the Company expects and
intends to continue the Plan, the Company must necessarily reserve, and
does hereby reserve, the right to amend the Plan at any time, except that
no amendment may be adopted, without the approval of ALPA, provided, that.
with respect to amendments adopted which are described in Section 13.1(b)
or (d) of the ESOP (which subsections shall be treated as appropriately
modified to the extent necessary to reflect the circumstances of this Plan)
the need for joint approval shall be modified, and provided further that
no amendment which would affect the allocation of the Class M Voting Shares
shall be adopted without the approval of the IAM.

5.2     Termination. Subject to the approval of
ALPA and IAM, the Plan will terminate as to all of the Employees on any
date specified by the Board. Notwithstanding the preceding sentence, the
approval of the IAM will only be required if Class M Voting Shares reserved
for allocation have been transferred or contributed to the Supplemental
Trust.

5.3     Effect of Amendment or Termination. Any
amendment, modification, or termination shall not reduce, alter, or impair
any rights under the Plan as to amounts credited to the Accounts of Participants
under the Plan as of the date of such amendment, modification or termination.

 

 

ARTICLE 6

Miscellaneous Provisions

6.1     Source of Payments.

(a) It is intended that this Plan and the benefits thereunder be unfunded
and unsecured for tax purposes and for purposes of Title I of ERISA:

(b) Notwithstanding any other provisions of the Plan, the obligation
under this Plan to a Participant or Beneficiary is a liability of the Company
and the Participant's Employer, except to the extent paid from the Supplemental
Trust. Liabilities of the Company and each Participant's Employer to any
Participant or Beneficiary pursuant to the Plan shall be those of a debtor
pursuant only to the contractual obligations created by the Plan; no such
obligation of the Company and a Participant's Employer shall be deemed
to be secured by any pledge or other encumbrance on any property of the
Company, such Participant's Employer or otherwise. To the extent that any
Participant or Beneficiary acquires a right to receive payment from the
Company or a Participant's Employer under the Plan, such right shall be
no greater than the right of an unsecured general creditor of the Company
and Participant's Employer. No Employer or Affiliate shall, by virtue of
any provisions of the Plan or by any action of any person, be deemed to
be a trustee or other fiduciary of any property for any Participant or
Beneficiary.

(c)     (i) The creation and funding of the Supplemental
Trust shall not create a security interest in the property of such trust
in favor of Participants or Beneficiaries or otherwise cause a "funding"
of the Plan or Trust inconsistent with Section 6.1 (a) hereof.

(ii) It is intended that Voting Shares may be deposited in and distributed
from the Supplemental Trust directly to Participants and Beneficiaries
(after conversion to Common Stock), provided that the Trustee may transfer
the Voting Shares to the Company for prompt distribution of Plan benefits
to Participants and Beneficiaries.
(iii) Except as provided in (e) below, it is intended that the Convertible
Shares not be deposited in the Supplemental Trust.

(d) The Company Stock credited under this Plan shall be used solely as
a device for the measurement and determination of the amounts to be paid
as benefits under this Plan. Each Participant's rights with respect to
such shares is limited to the right to receive a distribution of Plan benefits
as herein provided. No. Participant shall be entitled to any voting or
dividend rights or any other rights of a shareholder with respect to shares
credited under this Plan until due issuance of shares to him. Prior to
such due issuance, such shares, whether or not held by the Supplemental
Trust, shall not be treated as property owned or beneficially owned by
the Participant.

(e) ALPA may at any time direct that, in addition to Voting Stock previously
delivered to the Supplemental Trust, all other Company Stock credited under
this Plan (including unreleased Company Stock credited to the Phantom Suspense
Account) be delivered by the Company to the Trustee of the Supplemental
Trust for retention and distribution in a manner corresponding to the treatment
of Voting Shares hereunder. Such delivery shall be made as soon as possible
following ALPA's request in accordance with Section 1(h) of the Supplemental
Trust; the Company shall make any amendments to the Plan or Supplemental
Trust agreement as ALFA may reasonably request to clarify further operation
of the Plan and Trust to reflect delivery of such shares (in lieu of the
book-entry system provided for herein) in the manner contemplated by Schedules
1.6(b)(iii) and 1.6(b)(iv), respectively, to the unamended Agreement and
Plan of Recapitalization dated as of March 25, 1994 among the Company,
ALPA and the IAM, but such delivery shall not await the making of those
amendments.

6.2     Transfer Restrictions Provisions.

(a) This Plan and the issuance or transfer of shares of Common Stock
(and/or the payment of money) pursuant thereto are subject to all applicable
Federal and state laws, rules and regulations, to the rights, preferences,
limitations, and restrictions set forth in the Company's Certificate of
Incorporation and Bylaws, and to such approvals by any regulatory or governmental
agency (including without limitation "no action" positions of the Securities
and Exchange Commission) which may, in the opinion of counsel for the Company,
be necessary or advisable in connection therewith. Without limiting the
generality of the foregoing, no shares shall be issued by the Company,
nor cash payments made by the Company, unless and until all legal requirements
applicable to the issuance or payment have, in the opinion of counsel to
the Company, been complied with. In connection with any stock issuance
or transfer, the person acquiring the shares shall, if requested by the
Company, give assurances satisfactory to counsel to the Company in respect
to such matters as the Company may deem desirable to assure compliance
with all applicable legal requirements and the Company's Certificate of
Incorporation and Bylaws.

(b) The Company shall at all times maintain an effective registration
statement under the Securities Act of 1933 and timely comply with the reporting
requirements under the Securities Exchange Act of 1934 with respect to
the shares of Common Stock. The Company shall obtain any other federal,
state or local approvals as may be necessary from time to time to enable
the Trustee to consummate any desired conversion or disposition of the
shares of Company Stock. Notwithstanding the foregoing, there shall be
no public sale or distribution of Common Stock without the consent of UAL
during the seven days prior to or ninety days after any registration statement
relating to an underwritten sale of securities of UAL has become effective.

6.3     Inalienability of Benefits. No benefit payable
under, or interest in, the Plan shall be subject in any manner to anticipation,
alienation, sale, transfer, assignment, pledge, encumbrance, or charge,
and any attempt to do so shall be void. Any such benefit or interest shall
not in any manner be liable for or subject to garnishment, attachment,
execution, or levy or liable for or subject to the debts, contracts, liabilities,
engagements, or torts of any Participant or Beneficiary. If the Committee
finds that any Participant or Beneficiary has become bankrupt or that any
attempt has been made to anticipate, alienate, sell, transfer, assign,
pledge, encumber, or charge any benefit payable under, or interest in,
the Plan, the Committee shall hold or apply such benefit or interest or
any part thereof to or for the benefit of such Participant or Beneficiary.

6.4     No Right of Employment. Nothing contained
herein nor any action taken under the provisions hereof shall be construed
as giving any Participant the right to be retained in the employ of any
Employer or its Affiliates.

6.5     Withholding. The Company or the Trustee,
-as directed by the Company, shall withhold from any payment hereunder
any required amount of income and other taxes. Notwithstanding the foregoing,
if the Company, in its sole discretion, determines that the Participant
is subject to income or other tax withholding prior to the payment of benefits
hereunder, all such amounts shall be withheld from the compensation otherwise
payable by the Employer to the Participant. The Committee will provide
to the Company all information reasonably requested by the Company to calculate
the appropriate withholding amount. In accordance with written instructions
from the Company, the Trustee shall sell such number of shares of Common
Stock (after converting the Voting Shares, if necessary) necessary to provide
the required withholding with respect to benefits payable from the Supplemental
Trust. The Trustee will remit any amounts so withheld as instructed by
the Committee, including to the Company or the Employer if so instructed
by the Committee. The withholding of any taxes hereunder shall not affect
the determination of whether a Participant has received the benefits to
which he is entitled to under the Plan.

6.6 Headings. The headings of the sections in the Plan are placed herein
for convenience of

reference; in the case of any conflict, the text of the Plan, rather
than such heading, shall control.

6.7     Construction. Except to the extent governed
by federal law, the Plan shall be construed, regulated, and administered
in accordance with the laws of the State of Illinois. If any provision
shall be held by a court of competent jurisdiction to be invalid and unenforceable,
the remaining provisions of this Plan shall continue to be fully effective.
To the extent possible, each provision of the Plan shall be administered,
interpreted and construed to carry out the intent of the Plan as set forth
in Section 1.1 and Section 2.4(g); provided, that in no event shall the
number of Voting Shares and Convertible Shares allocated or credited under
this Plan and ESOP (Part B) exceed the maximum number set forth in Section
2.2(a) (including any Additional Shares). Any provision that cannot be
administered, interpreted and construed to carry out the intent of the
Plan set forth in Section 6.1(a) shall, to that extent, be disregarded.

6.8     Receipt and Release. Any payment to any
Participant or Beneficiary in accordance with the provisions of this Plan
shall, to the extent thereof, be in full satisfaction of all claims against
the Company with respect to this Plan and the Committee tray require such
Participant or Beneficiary, as a condition precedent to such payment, to
execute a receipt and release to such effect. If any Participant or Beneficiary
is determined by the Committee to be incompetent by reason of physical
or mental disability (including minority) to give a valid receipt and release,
the Committee may cause the payment or payments becoming due to such person
to be made to another person for his benefit without responsibility on
the part of the Committee or the Company to follow the application of such
funds.

6.9     Voting; Control Transaction.

(a) The Committee shall instruct the Trustee how all shares of Company
Stock held by the Supplemental Trust shall be voted. In the case of a Control
Transaction with respect to the shares, the Committee shall instruct the
Trustee whether to exchange or tender such shares or otherwise how to respond.
In either case, the Committee shall consider the sentiments of the Participants,
but shall not be required to take any particular action in response thereto.
The Company and the Trustee agree to amend the Plan and Supplemental Trust
to provide for pass-through voting and response rights for all Employee
Groups in the manner set forth in the ESOP if directed to do so by ALPA
in writing (which notice shall also constitute approval of ALPA).

(b) Notwithstanding any provision of the Plan or Supplemental Trust
that requires exclusive investment in Company Stock, the following additional
rules shall apply in the case of a Control Transaction: (i) if ALPA so
requests in writing, all Convertible Shares credited under this Plan (including
such shares credited to the Phantom Suspense Account) and all Voting Shares
credited to the Phantom Suspense Account shall be delivered by the Company
to the Supplemental Trust and the Plan and Supplemental Trust shall be
amended, such delivery and amendments to be in accordance with Section
6.1(e) hereof, provided that at ALPA's request, such delivery may be subject
to the same conditions for the sale of ESOP Preferred to the ESOP set forth
in Section 8.2(e) of the ESOP; (ii) to the extent possible, all proceeds
from any sale or exchange of Voting Shares and Convertible Shares shall
be reinvested in "appropriate securities," as defined in Section 8.2(d)
of the ESOP and the Plan shall continue; and (iii) if the Trustee is unable
so to invest, the Company shall make appropriate arrangements reasonably
satisfactory to ALPA, it being the present intention that those arrangements
should parallel those established for the ESOP. In the case of a Control
Transaction, if ALPA does not request that the Convertible Shares and Voting
Shares be delivered to the Supplemental Trust, the Company shall make appropriate
arrangements, reasonably satisfactory to ALPA, to protect the substantive
economic interests of the affected Employee Groups, it being the present
intention that these arrangements shall parallel those established for
the ESOP.

6.10     Notices. Any notice or document required
to be filed with the Committee under the Plan shall be provided in a manner
consistent with Section 15.4 of the ESOP, which terms are hereby incorporated
into this Plan to the extent consistent with the terms hereof.

6.11     Evidence. Evidence required of anyone under
the Plan may be by certificate, affidavit, document or other information
which the person acting on it considers pertinent and reliable, and signed,
made or presented by the proper party or patties.

6.12     Action by Employer. Any action required
or permitted to be taken by an Employer under the Plan shall be by resolution
of its board of directors or by a person or persons authorized by its board
of directors.

6.13     Execution. To record the adoption of this
Plan, the undersigned duly authorized officers of the Company have caused
this document to be executed and to bear the corporate seal of the Company,
all as of the Effective Date.

6.14     Cooperation. At the request of ALPA, the
Company agrees that it will (a) use reasonable efforts to submit and otherwise
cooperate in obtaining an IRS ruling that the contemplated operation of
the Plan and the Supplemental Trust will not result in current income tax
taxation to any Participant or Beneficiary, and (b) adopt such amendments
to this Plan and the Supplemental Trust as may be reasonably requested
by ALPA for the purposes of further protection against such taxability,
provided such amendments do not materially increase the costs of operating
the Plan and Supplemental Trust. By accepting the Plan and any Supplemental
Trust, the Trustee shall thereby have agreed to acknowledge and accept
any such amendment.

6.15     Adjustments. This Plan contains various
references to ESOP Preferred Stock, Convertible Shares and to various numbers
of such shares. If and to the extent appropriate, an appropriate revision
shall be made to such references if the Preferred Stock and/or Convertible
Shares are changed into, or exchanged for, a different number or kind of
shares or securities of the Company through a reorganization or merger,
or through a combination, recapitalization, reclassification. stock consolidation
or otherwise.

 

 

IN WITNESS WHEREOF, the Company has caused this Plan to be executed
this 12th day of July 1994.

 

 

                                          
                   
UAL CORPORATION

 

 

                                      
                       
By: /s/ J.R. O'Gorman

 

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