{"id":40004,"date":"2015-09-17T11:25:58","date_gmt":"2015-09-17T16:25:58","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-legal\/contracts\/uncategorized\/incentive-compensation-and-profit-sharing-plan-ual-corp.html"},"modified":"2015-09-17T11:25:58","modified_gmt":"2015-09-17T16:25:58","slug":"incentive-compensation-and-profit-sharing-plan-ual-corp","status":"publish","type":"corporate_contracts","link":"https:\/\/corporate.findlaw.com\/contracts\/compensation\/incentive-compensation-and-profit-sharing-plan-ual-corp.html","title":{"rendered":"Incentive Compensation and Profit Sharing Plan &#8211; UAL Corp."},"content":{"rendered":"<pre>                         UAL CORPORATION\n                                \n         INCENTIVE COMPENSATION AND PROFIT SHARING PLAN\n                                \n                                \n                                \n                                \nI.  PURPOSE\n\n     In an effort to maintain a position of leadership in the\nfast-growing and highly competitive business segments in which\nUAL Corporation (the 'Company') competes, it is necessary to\npromote financial interests of the Company and its corporate\naffiliates (the 'Subsidiaries'), including its growth, by (A)\nattracting and retaining highly qualified executives possessing\noutstanding ability, (B) motivating executives and other\nmanagement employees by means of performance related incentives,\nand (C) providing incentive compensation opportunities which are\ncompetitive with those of major corporations.  The Incentive\nCompensation Plan (the 'Plan') hereinafter described is designed\nto assist the Company in attaining these objectives.\n\nII.  ADMINISTRATION OF THE PLAN\n\n     1.  The Company is responsible for the general\nadministration of the Plan, except as to matters expressly\nreserved in this Plan to the Compensation Administration\nCommittee of the Board of Directors of the Company (the 'Board'),\nwith respect to all grants to any 'covered employee' within the\nmeaning of Section 162(m) of the Internal Revenue Code of 1986,\nas amended (the 'Code') and regulations promulgated thereunder\n(the 'Covered Employees'), and to the Compensation Committee of\nthe Board with respect to all other grants.  Unless specifically\nnamed, the Compensation Administration Committee or Compensation\nCommittee, whichever is applicable in the context, will herein be\ncalled the 'Committee.'  Determinations, decisions and actions of\nthe Company or the Committee in connection with the construction,\ninterpretation, administration, or application of the Plan will\nbe final, conclusive, and binding upon any Participant and any\nperson claiming under or through the Participant.  Neither the\nCompany nor any member of the Committee will be liable for any\ndetermination, decision, or action made with respect to the Plan\nor any Incentive Award granted, or Profit Sharing Payments made,\nunder the Plan.\n\n     2.  A Participant's rights and interests in any Incentive\nAward or Profit Sharing Amount under the Plan may not be assigned\nor transferred and are not subject to attachment, garnishment,\nexecution, or other creditor's processes.\n\n     3.  If a Participant transfers employment classifications\nduring a calendar year, the amount of the Participant's Incentive\nCompensation Payments or Profit Sharing Payments for that\ncalendar year shall be based on the amount of the Participant's\ncompensation that he\/she receives during that calendar year as an\nIncentive Compensation Participant or Profit Sharing Participant,\nas the case may be.\n\n     4.  The Incentive Compensation Plan may at any time  be\namended, modified, or terminated, as the Board, in its\ndiscretion, determines.  The Profit Sharing Plan may at any time\nbe amended, modified, or terminated, as the Company. in its\ndiscretion, determines. Such amendment, modification, or\ntermination of the Incentive Compensation Plan or the Profit\nSharing Plan will not require the consent, ratification, or\napproval of any party, including any Participant.\n\n     5.  The Plan does not constitute a contract of employment,\nand participation in the Plan will not give any employee the\nright to be retained in the service of the Company or its\nSubsidiaries.\n\n     6.  This Plan and all determinations made and actions taken\npursuant hereto will be governed and construed by the internal\nlaws of the State of Illinois.\n\nIII.  DEFINITIONS\n\n     1.  Award Year -- The calendar year for which Incentive\nAwards, if any, are calculated under the Plan.\n\n     2.  Financial Objectives -- Financial performance goals\nestablished by the Company and approved by the Committee at the\nbeginning of an Award Year.  Financial Objectives may apply to\noverall Company and Subsidiaries performance in selected areas\nand\/or to performance of major business segments of the Company\nand Subsidiaries.\n\n     3.  Financial Performance Factor -- The numerical factor\ndetermined by the Company shortly after the Award Year by\ncomparing actual performance during such Award Year to the\napplicable Financial Objectives previously established for such\nAward Year.\n\n     4.  Incentive Compensation Participant -- A person who is a\nsenior or a key management employee of the Company or one or more\nSubsidiaries and who is designated as an Incentive Compensation\nParticipant for an Award Year by the Company or the Committee.\nDesignation as an Incentive Compensation Participant will apply\nonly for the Award Year for which the designation is made.  The\nCompany may, in its sole discretion, designate certain management\nemployees as Special Incentive Compensation Participants for an\nAward Year.\n\n     5.  Incentive Compensation Plan --  The provisions of this\nPlan as applied to Incentive Compensation Participants.\n\n     6.  Individual Performance Objectives -- Goals and\nobjectives established by the Company (or by the Compensation\nAdministration Committee in the case of Covered Employees) for\neach Incentive Compensation Participant.\n\n     7.  Individual Performance Factor -- The numerical factor\ndetermined with respect to the Plan by the Company (or by the\nCompensation Administration Committee in the case of Covered\nEmployees) shortly after the Award Year, based upon an evaluation\nas to the extent to which an Incentive Compensation Participant\nin the Plan achieved the Individual Performance Objectives\nestablished for him\/her.  Such evaluation will be wholly\ndiscretionary and subjective on the part of the Company or the\nCompensation Administration Committee, as the case may be.\n\n     8.  Incentive Awards -- The dollar value of awards made to\nIncentive Compensation Participants under the Plan.\nNotwithstanding any other provisions of the Plan, in no event may\nthe total Incentive Award for any Award Year for any Incentive\nCompensation Participant exceed 100% of his\/her base salary for\nthe Award Year.\n\n     9.  Incentive Opportunity -- The amount, determined by the\nCompany and approved by the Committee, as appropriate, at the\nbeginning of an Award Year, that an Incentive Compensation\nParticipant may receive as an Incentive Award under the Plan.\nThe Incentive Opportunity will be stated as a percentage of an\nIncentive Compensation Participant's annual base salary for an\nAward Year (prorated for a partial year's participation).  If an\nIncentive Compensation Participant held more than one eligible\nposition in the Award Year, his\/her Incentive Opportunity will be\ndetermined on a prorated basis.  The Incentive Opportunity for a\nSpecial Incentive Compensation Participant shall be stated as a\ndollar amount rather than as a percentage of his\/her annual base\nsalary for the Award Year.\n\n     10.  Participant -- An Incentive Compensation Participant or\na Profit Sharing Participant, whichever is applicable.\n\n     11.  Profit Sharing Goals -- The collective Financial\nObjectives for the Company and its Subsidiaries for the Profit\nSharing Year that coincides with the Award Year for which the\nFinancial Objectives are established as determined by the\nCompany.  For purposes of determining the amount of Profit\nSharing Payments, the Profit Sharing Goals for a particular\nProfit Sharing Year shall be separately stated as a threshold\ngoal, a target goal and a maximum goal.\n\n     12.  Profit Sharing Participant -- A person who, on his\/her\nEmployee Service Record Form UG 100 or any successor thereof, is\nclassified, for at least part of the Profit Sharing Year for\nwhich the Profit Sharing Payment is being made, as a regular full-\ntime or regular part-time management employee, is not an\nIncentive Compensation Participant and, on December 31 of that\nProfit Sharing Year, is actively employed in any job\nclassification, has retired.\n\n     13.  Profit Sharing Payments -- The amount to which Profit\nSharing Participants are entitled for a Profit Sharing Year, as\ndetermined under Section V of the Plan.\n\n     14.  Profit Sharing Plan --  The provisions of this Plan as\napplied to Profit Sharing Participants.\n\n     15.  Profit Sharing Year -- The calendar year.  Unless the\nCompany specifically otherwise determines, Profit Sharing\nPayments shall be made only for 1997, 1998, and 1999 in the\nsubsequent calendar year.\n\n     16.  Profit Sharing Wages -- The amount of a Profit Sharing\nParticipant's taxable wages for the Profit Sharing Year,\nincreased by the amount of his\/her pre-tax contributions under\nany qualified Code Section 401(k) plan or Code Section 125\ncafeteria plan and any HMO premium deductions for the Profit\nSharing Year, and decreased by the amount of any extraordinary\npayments such as moving expense reimbursements, Pride Awards and\nCode Section 125 cafeteria plan reimbursements for the Profit\nSharing Year\n     \n\nIV.  INCENTIVE COMPENSATION PAYMENTS\n\nA.  Participation\n\n     1.  Incentive Compensation Participants will be determined\nannually by the Company or the Committee from among key and\nsenior management employees of the Company and its Subsidiaries.\nThis determination will allow participation only for the Award\nYear concerned.\n\n     2.  If an Incentive Compensation Participant's employment\nwith the Company or its Subsidiaries is terminated during an\nAward Year, the appropriate Incentive Award under the Plan, if\nany, for such Participant will be subject to the sole discretion\nof the Company's Chairman (or to the sole discretion of the\nCompensation Administration Committee in case of the termination\nof employment of a Covered Employee).  A transfer of employment\nbetween the Company and any of its Subsidiaries will not be\nconsidered a termination of employment.\n\nB.  Computation of Incentive Awards\n\n     1.  The Incentive Award for an Award Year for an Incentive\nCompensation Participant will be the product of the Incentive\nCompensation Participant's Incentive Opportunity modified by the\nFinancial Performance Factor and Individual Performance Factor,\nmultiplied by the Incentive Compensation Participant's applicable\nbase salary.  No Incentive Award will be made to an Incentive\nCompensation Participant for an Award Year in which his\/her\napplicable Financial Performance Factor is below threshold level.\nHowever, the Chairman of the Company, with Committee approval,\nmay waive the applicable Financial Performance Factor threshold\nrequirement.\n\n     2.  Total payments to all Incentive Compensation\nParticipants will be limited to 5% of Pre-Tax Income in any given\nAward Year.  If total calculated Incentive Awards exceed 5% of\nPre-Tax Income, payments will be made on a prorated basis.\n\nC.  Payment of Awards\n\n     1.  Subject to Paragraph 2 below, payment of Incentive\nAwards will be made in cash on or about April 1 of the year\nfollowing the Award Year; provided, however, that an Incentive\nAward may be deferred at the election of an Incentive\nCompensation Participant in the manner described in Paragraph 2\nbelow.\n\n     2.  An Incentive Compensation Participant may elect, on or\nbefore December 31 of the year preceding an Award Year, to defer\nreceipt of all or any portion of his\/her Incentive Award to a\nsubsequent calendar year.  An Incentive Compensation Participant\nwill receive payment of a deferred Incentive Award in a lump sum\nin January of the earliest of:  (1) the deferral calendar year\nselected by the Incentive Compensation Participant; (2) the\ncalendar year immediately after the Incentive Compensation\nParticipant's retirement under the United Air Lines, Management\nand Salaried Pension Plan, (3) the calendar year after the\nIncentive Compensation Participant's termination of employment\nwith the Company or Subsidiaries for other reasons, provided that\na transfer of employment from the Company or one of its\nSubsidiaries to the Company or another of its Subsidiaries will\nnot be considered a termination of employment; (4) the occurrence\nof an 'Unforeseeable Emergency,' provided that a distribution\npursuant to this clause (4) shall not exceed the amount\nreasonably needed to satisfy the emergency need; or (5) any other\ntime elected by the Incentive Compensation Participant, provided\nthat upon making such an election, the Incentive Compensation\nParticipant shall be entitled to receive 90% of the amounts then\ncredited to him\/her under the Plan and shall forfeit the\nremaining 10% of such amount.  The amounts deferred will be\ncredited annually with compound interest at the prime rate in\neffect during the deferral period at the end of the calendar\nquarter, as reported by The Wall Street Journal.  All deferred\nIncentive Awards will be reflected in the Company's books as\ngeneral unsecured and unfunded obligations of the Company.  No\ntrust in favor of any Incentive Compensation Participant will be\nimplied.  Deferral elections will be irrevocable by an Incentive\nCompensation Participant.  For purposes of this paragraph,\n'Unforeseeable Emergency' shall mean a severe financial hardship\nto the Incentive Compensation Participant resulting from a sudden\nand unexpected illness or accident of the Incentive Compensation\nParticipant or of his\/her dependent (as defined in Section 152(a)\nof the Code), loss of the Incentive Compensation Participant's\nproperty due to casualty, or other similar extraordinary and\nunforeseeable circumstances arising as a result of events beyond\nthe control of the Incentive Compensation Participant.  The\ncircumstances that will constitute an Unforeseeable Emergency\nwill depend upon the facts of each case, but, in any case,\npayment under clause (4) above may not be made to the extent that\nsuch hardship is or may be relieved (i) through reimbursement or\ncompensation by insurance or otherwise, (ii) by liquidation of\nthe Incentive Compensation Participant's assets, to the extent\nthe liquidation of such assets would not itself cause severe\nfinancial hardship, or (iii) by cessation of deferrals under the\nPlan.\n\nD.  Special Incentive Compensation Rules\n\n     1.  Notwithstanding any other provision of this Plan to the\ncontrary:  Incentive Awards with respect to an Award Year for any\nIncentive Compensation Participant who is a Covered Employee with\nrespect to such Award Year (i) may not exceed $900,000 and (ii)\nshall be determined by reference to a formula which shall define\nthe Incentive Award by reference to the attainment by the Company\nof one or more target levels of pre-tax income (as determined\nunder generally accepted accounting principles but without regard\nto any items (whether gains or losses) otherwise included therein\nrelating to (a) the UAL Corporation Employee Stock Ownership\nPlan, the UAL Corporation Supplemental ESOP, or the trusts\nrelating thereto, (b) any event or occurrence that the\nCompensation Administration Committee determines to be either not\ndirectly related to the operations of the Company or not within\nthe reasonable control of the Company's management, (c) this\nPlan, and (d) the Company's 1988 Restricted Stock Plan) for such\nAward Year.  Such target level(s) and the formula referred to\nabove shall be determined by the Compensation Administration\nCommittee prior to the commencement of such Award Year (or at\nsuch later time as may be permissible under Section 162(m) of the\nCode). The Compensation Administration Committee shall determine\nand certify whether such target levels of pre-tax income have\nbeen met.  Notwithstanding the foregoing, the Compensation\nAdministration Committee may, in its sole discretion, reduce the\nIncentive Award otherwise determined pursuant to such formula.\n\nV.  PROFIT SHARING PAYMENTS\n\nA.  Participation\n\n     Each Profit Sharing Participant shall be entitled to a\nProfit Sharing Payment in the amount, if any, as determined below\nfor each Profit Sharing Year in which he\/she satisfies the\ndefinition of the term 'Profit Sharing Participant.'\n\nB.  Computation of Profit Sharing Payments\n\nThe amount of Profit Sharing Payment to be made to a Profit\nSharing Participant for a Profit Sharing Year is the product of\nhis\/her Profit Sharing Wages for the Profit Sharing Year,\nmultiplied by the percentage determined under the following\ntable, on the basis of the performance of the Company and its\nSubsidiaries relative to its Profit Sharing Goals for the Profit\nSharing Year:\n          \n     Profit Sharing Goal      Percentage of Profit Sharing Wages\n     -------------------      ----------------------------------\n          \n     Less Than Threshold                  0%\n        Threshold                         1.00%\n          Target                          2.55%\n         Maximum                          3.75%\n          \nIf the Company and its Subsidiaries achieve a Profit Sharing Goal\nof at least the Threshold and between any two of the levels set\nforth in the schedule above, the applicable Percentage of Profit\nSharing Wages shall be the amount determined by linear\ninterpolation between the two levels of Profit Sharing Goals.\n\nC.  Payment\n\n     Profit Sharing Payments for a Profit Sharing Year will be\nmade to Profit Sharing Participants no later than March 31 of the\ncalendar year following the Profit Sharing Year for which the\nProfit Sharing Payments are made.\n<\/pre>\n","protected":false},"template":"","meta":{"_acf_changed":false,"_stopmodifiedupdate":true,"_modified_date":"","_cloudinary_featured_overwrite":false},"corporate_contracts_companies":[9136],"corporate_contracts_industries":[9521],"corporate_contracts_types":[9539,9546],"class_list":["post-40004","corporate_contracts","type-corporate_contracts","status-publish","hentry","corporate_contracts_companies-ual-corp","corporate_contracts_industries-transportation__air","corporate_contracts_types-compensation","corporate_contracts_types-compensation__incentive"],"acf":[],"_links":{"self":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts\/40004","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts"}],"about":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/types\/corporate_contracts"}],"wp:attachment":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/media?parent=40004"}],"wp:term":[{"taxonomy":"corporate_contracts_companies","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_companies?post=40004"},{"taxonomy":"corporate_contracts_industries","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_industries?post=40004"},{"taxonomy":"corporate_contracts_types","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_types?post=40004"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}