UAL CORPORATION
Retirement Plan for Outside Directors, as Supplemented March 30, 1995
I. Effective Date
The provisions of this plan shall be effective for any Eligible
Director (as defined below) who terminates his/her service with UAL
Corporation (the 'Corporation') on or after January 1, 1987 (the
'Effective Date') thereto. Notwithstanding the foregoing, the
provisions of this plan which become operable upon the occurrence of
a Change in Control (as hereinafter defined) shall not apply to any
participant who first becomes an Outside Director (as hereinafter
defined) subsequent to the Change in Control which occurred on July
12, 1994 (the 'Recapitalization') and who as of March 30, 1995, has
not satisfied the months of service requirement entitling such
participant to benefits hereunder (a 'Subsequent Director'). With
respect to each Subsequent Director, the plan shall be read and
interpreted as if the provisions hereof pertaining to a Change in
Control were deleted herefrom, and no Subsequent Director shall be
entitled to any benefits under, or to enforce any provisions of, this
plan that apply to or became operative as a result of a Change in
Control.
II. Purpose
This Plan is designed to assist the Corporation in attracting
and retaining as directors individuals of superior talent, ability
and achievement.
III. Eligibility
An Eligible Director entitled to benefits under this Plan shall
be any Outside Director (as defined below) of the Corporation who has
served as a director for at least sixty months, and who retires from
the Corporation's Board of Directors or otherwise terminates service
as a member of such Board of Directors on or after the Effective
Date. An Outside Director shall be a director of the Corporation who
is not entitled to receive employee pension benefits from the
Corporation or from any of its subsidiaries.
IV. Benefits
1. An Eligible Director who retires or otherwise terminates service
as a member of the Corporation's Board of Directors at or after
age 70, shall receive annually for life a percentage of the
annual retainer in effect for directors as of the Effective Date
or as of the date of the director's retirement, whichever is
greater (the 'Applicable Annual Retainer'), in accordance with
the following schedule based on his/her months of service as a
director:
At least 60 but less than 72 months of service - 50%
At least 72 but less than 84 months of service - 60%
At least 84 but less than 96 months of service - 70%
At least 96 but less than 108 months of service - 80%
At least 108 but less than 120 months of service - 90%
120 or more months of service - 100%
Notwithstanding the foregoing, with respect to an Eligible
Director who is an Outside Director immediately prior to a
Change in Control (as defined below) and who thereafter
retires or otherwise terminates service as a member of the
Corporation's Board of Directors in connection with such
Change in Control or at any time thereafter, and regardless
of such Eligible Director's age at the time of such retirement
or other termination or service, 'Applicable Annual Retainer'
shall mean the greatest of (a) the annual retainer in effect for
directors on January 1, 1987, (b) the annual retainer in effect
or directors immediately prior to the Change in Control and (c)
the annual retainer in effect for directors on the date of such
retirement or other termination of service.
2. An Eligible Director who retires or otherwise terminates service
prior to age 70 shall receive annually for a period equal to the
lesser of (a) the number of months of his/her service as a
director of the Corporation, or (b) his/her life, the percentage
of the Applicable Annual Retainer (determined after giving
effect to the last sentence of Section I of Article IV hereof)
determined in accordance with the schedule set forth in Section
1 of Article IV hereof.
3. Benefits under this Plan shall be payable on or about the 5th
day of each February, May, August and November (the 'Payment
Months'). Payments shall commence in the Payment Month
immediately after an Eligible Director's retirement.
4. If a retired Eligible Director dies, leaving a surviving spouse,
before receiving payments under the Plan for a period ('Minimum
Payment Period') equal to the lesser of (a) 120 months, or (b)
his/her months of service as a director of the Corporation,
his/her surviving spouse shall be entitled to payments hereunder
for a period equal to the lesser of (a) the lifetime of the
surviving spouse, or (b) the balance of the Minimum Payment
Period.
5. For purposes of this Plan, a 'Change in Control' shall be deemed
to have occurred if (A) any 'person' (as such term is used in
Sections 13(d) and 14(d) of the Securities Exchange Act of 1934,
as amended (the 'Exchange Act')), is or becomes the 'beneficial
owner' (as defined in Rule 13d-3 under the Exchange Act),
directly or indirectly, of securities of the Company
representing 25% or more of the combined voting power of the
Company's then outstanding securities (such percentage ownership
to be determined in the manner provided in Rule
13-3(d)(1)(i) under the Exchange Act); or (B) during any period
of two consecutive years or portion thereof (not including any
period prior to the execution of this Amendment), individuals
who at the beginning of such period constitute the Board and any
new director (other than a director designated by a person who
has entered into an agreement with the Company to effect a
transaction described in clause (A) or (C) of this Subsection)
whose election by the Board or nomination for election by the
Company's shareholders was approved by a vote of at least two-
thirds (2/3) of the directors then still in office who either
were directors at the beginning of the period or whose election
or nomination for election was previously so approved, cease for
any reason to constitute a majority thereof; or (C) the
shareholders of the Company approve a merger or consolidation of
the Company with any other corporation (or similar transaction),
other than a merger or consolidation (or similar transaction)
which would result in the voting securities of the Company
outstanding immediately prior thereto continuing to represent
(either by remaining outstanding or by being converted into
voting securities of the surviving entity) at least 80% of the
combined voting power of the voting securities of the Company or
such surviving entity outstanding immediately after such merger,
consolidation or similar transaction (either alone or in
combination with new or additional voting securities held by
management of the Company and its subsidiaries) or the
shareholders of the Company approve a plan of complete
liquidation of the Company or an agreement for the sale or
disposition by the Company of all or substantially all of the
Company's assets. For purposes of (I) clause (A) of the
preceding sentence, beneficial ownership of securities of United
Air Lines, Inc. ('United') representing 25% or more of the
combined voting power of United's then outstanding securities
shall be deemed to constitute such beneficial ownership of the
Company and (II) clause (C) of the preceding sentence, the
approval by the shareholders of United of a plan of complete
liquidation of United or an agreement for the sale or
disposition by United of all or substantially all of United's
assets shall be deemed to constitute approval by the
shareholders of the Company of such events in respect of the
Company.
6. For purposes of this Article IV an Outside Director who is an
Outside Director immediately prior to a Change in Control and
who retires or otherwise terminates service in connection with
such Change in Control or at any time thereafter (a) shall be
deemed to have served as a director of the Corporation for a
period of months equal to the greater of (i) his or her actual
period of service plus 36 or (ii) 60 (and 'his/her months of
service' (as used in Section 1 above) and phrases of similar
import in this Plan shall be calculated by giving effect to such
deemed service) and (b) shall be deemed to be 3 years older than
his/her actual age at the time of his/her retirement or other
termination of service.
V. Administration
The Plan shall be administered by the Corporation's Executive
Committee (the 'Committee'). The Committee shall have plenary
authority in its discretion, but subject to the provisions of the
Plan, to interpret the Plan, and to make all determinations deemed
advisable for the administration of the Plan. The determinations of
the Committee shall be conclusive and binding on all interested
parties.
VI. Miscellaneous
1. Amendment and Termination. The Committee may amend, modify,
suspend, or terminate the Plan at any time prior to the
occurrence of a Change in Control, without the consent of the
participants but, in the event of any such amendment,
modification, suspension, or termination, benefit payments which
have already accrued, are payable in the future, or are being
paid, will continue in accordance with the Plan as in effect
prior to such amendment, modification, suspension, or
termination. Upon or subsequent to the occurrence of a Change
in Control, the Committee may amend, modify, suspend or
terminate the Plan only with the consent of all participants
herein.
2. Rights of Directors. Neither the establishment of the Plan nor
any action hereafter taken by the Corporation or the Committee
shall be construed as giving to any director any vested right to
a benefit from the Plan beyond the terms of the Plan.
3. Liability. Neither the Board of Directors of the Corporation
nor any member of the Committee nor any person to whom any of
them may delegate any duty or power in connection with
administering the Plan shall be personally liable for any action
or failure to act with respect to the Plan.
4. Nonassignability. Benefits payable under the Plan shall not be
subject in any manner to anticipation, assignment, pledge,
alienation, or charge by an Eligible Director or his/her
surviving spouse; nor shall any such benefits be in any manner
liable for or subject to the debts or any other liabilities of
the Eligible Director or his/her surviving spouse; nor shall any
interest of any Eligible Director or his/her surviving spouse
under the Plan be subject to garnishment, attachment, lien, or
levy of any kind.
Retirement Plan for Outside Directors - UAL Corp.
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