DEFERRED SHARE AWARD AGREEMENT
This Deferred Share Award Agreement (the "Agreement")
is effective as of July 23, 2007, by and between AMR
Corporation, a Delaware corporation (the "Corporation"), and
[FIRST NAME LAST NAME], employee number [EMPLOYEE NUMBER]
(the "Employee"), an officer or key employee of one of the
Corporation's Subsidiaries.
WHEREAS, pursuant to the AMR Corporation 1998 Long Term
Incentive Plan, as amended (the "LTIP"), and as adopted by
the Board of Directors of the Corporation (the "Board"), the
Compensation Committee of the Board (the "Committee") has
determined that the Employee is an officer or key employee
and has further determined to make an award of deferred
stock from and pursuant to the LTIP (the "Award") to the
Employee as an inducement for the Employee to remain an
employee of one of the Corporation's Subsidiaries.
NOW, THEREFORE, the Corporation and the Employee hereby
agree as follows:
1. Grant of Award.
Subject to the terms and conditions of this Agreement,
the Employee is hereby granted the Award effective as of
July 23, 2007 (the "Grant Date"), in respect to [NUMBER]
shares of the Corporation's Common Stock (the "Shares").
Subject to the terms and conditions of this Agreement, the
Shares covered by the Award will vest, if at all, in
accordance with Section 2 hereof, on July 23, 2010 (such
date hereby established as the "Vesting Date" of the Award).
2. Distribution of Award.
Distribution with respect to the Award will occur, if
at all, in accordance with the following terms and
conditions:
(a) If the Employee is on the payroll of a Subsidiary
that is wholly-owned, directly or indirectly, by the
Corporation as of the Vesting Date, the Shares covered by
the Award will be paid by the Corporation to the Employee on
or about the Vesting Date.
(b) In the event the Employee's employment with a
Subsidiary of the Corporation is terminated prior to the
Vesting Date due to the Employee's death, Disability (as
defined in Section 409A(a)(2)(C) of the Internal Revenue
Code of 1986, as amended (the "Code")), Retirement or
termination not for Cause (each an "Early Termination"), the
Shares covered by the Award will vest on a pro-rata basis
and will be paid to the Employee (or, in the event of the
Employee's death, the Employee's designated beneficiary for
the purposes of the Award, or in the absence of an effective
beneficiary designation, the Employee's estate). The pro-
rata basis will be a percentage where: (i) the denominator
of which is 36, and (ii) the numerator of which is the
number of months from the Grant Date through the month of
Early Termination, inclusive. The Shares comprising the pro-
rata Award will be paid by the Corporation to the Employee
(or, in the event of the Employee's death, the Employee's
designated beneficiary for the purposes of the Award, or in
the absence of an effective beneficiary designation, the
Employee's estate) on or about the Vesting Date, subject to
Section 2(e) of this Agreement. Notwithstanding the
foregoing, in no event will a payment be provided to the
Employee unless and until the Employee's Retirement or
termination not for Cause constitutes a "separation from
service" for purposes of Treasury Regulation 1.409A-1(h) or
successor guidance thereto.
(c) In the event of a Change in Control of the
Corporation prior to the payment of the Shares subject to
the Award, such payment will be made within 60 days of the
date of the Change in Control. In such event, the Vesting
Date will be the date of the Change in Control. The term
"Change in Control" is defined for purposes of this
Agreement in Section 5.
(d) Notwithstanding the terms of Sections 2(a), 2(b)
and 2(c), the Award will be forfeited in its entirety if
prior to the Vesting Date:
(i) the Employee's employment with a Subsidiary
of the Corporation is terminated for Cause,
or if the Employee terminates such employment
prior to his or her Retirement;
(ii) the Employee becomes an employee of a
Subsidiary that is not wholly-owned, directly
or indirectly, by the Corporation; or
(iii)the Employee takes a leave of absence without
reinstatement rights, unless otherwise agreed in
writing between the Corporation (or a Subsidiary
or Affiliate thereof) and the Employee.
(e) Notwithstanding the third sentence of Section 2(b)
above, if the Employee is a "specified employee" pursuant to
Treasury Regulation 1.409A-1(i) or successor guidance
thereto, any payment on account of his or her Retirement or
termination not for Cause shall be delayed until the earlier
of: (i) the sixth month anniversary of the date of
separation from employment due to Retirement or termination
not for Cause, or (ii) the date of the Employee's death.
(f) To the extent the Shares covered by the Award are
otherwise payable pursuant to this Agreement and except as
otherwise provided herein, such Shares will be paid on the
applicable dates and events specified in herein (each a
"Payment Date"); provided however, in no event shall any
such payment be made later than the 15th day of the third
month of the calendar year immediately following the
calendar year in which the Payment Date occurs.
(g) The amount of the Shares paid hereunder shall be
reduced by the aggregate amount of federal, state, and local
income and payroll taxes that are required to be withheld in
connection with the payment of such Shares.
3. Transfer Restrictions.
Unless otherwise permitted by the Committee, this award
is non-transferable, other than by will or by the laws of
descent and distribution, and may not be assigned, pledged
or hypothecated and will not be subject to execution,
attachment or similar process. Upon any attempt by the
Employee (or the Employee's successor in the interest after
the Employee's death) to effect any such disposition, or
upon the levy of any such process, the Award may immediately
become null and void, at the discretion of the Committee.
4. [Intentionally omitted]
5. Miscellaneous.
This Agreement (a) will be binding upon and inure to
the benefit of any successor of the Corporation, (b) will be
governed by the laws of the State of Texas and any
applicable laws of the United States, and (c) may not be
amended without the written consent of both the Corporation
and the Employee. Notwithstanding the foregoing, this
Agreement may be amended from time to time without the
written consent of the Employee pursuant to Section 7 below
and as permitted by the LTIP (or its successor). No
contract or right of employment will be implied by this
Agreement.
In consideration of the Employee's privilege to receive
the Award under this Agreement, the Employee agrees: (i) not
to disclose any trade secrets of, or other confidential or
restricted information of the Corporation or any of its
Subsidiaries to any unauthorized party; (ii) not to make any
unauthorized use of such trade secrets or confidential or
restricted information during or after his or her employment
with any Subsidiary of the Corporation; and (iii) not to
solicit any then current employees of any Subsidiary of the
Corporation to join the employee at his or her new place of
employment after such employment has terminated. The
failure by the employee to abide by the foregoing
obligations shall result in his or her award being forfeited
in its entirety.
For purposes of Section 2(c), the term "Change in
Control" will mean a "change in ownership" or "change in
effective control" or "change in ownership of the assets" of
the Corporation, as determined pursuant to Treasury
Regulation 1.409A-3(i)(5) or successor guidance thereto.
The Employee shall not have the right to defer any
payment of the Shares covered by the Award. Except as
provided in this Agreement, the Committee and Corporation
will not accelerate the payment of any of the Shares covered
by the Award.
Notwithstanding anything in this Agreement to the
contrary, the Committee may elect, at any time and from time
to time, in lieu of issuing all or any portion of the
Shares, to make substitutions for such Shares, all to the
effect that the Employee will receive cash or other
marketable property of a value equivalent to what the
Employee would have received upon a payment of Shares.
Additionally, notwithstanding anything to the contrary
contained in this Agreement, (i) any obligation of the
Corporation to pay or distribute any shares under this
Agreement is subject to and conditioned upon the Corporation
having sufficient stock in the LTIP or another shareholder-
approved equity compensation plan to satisfy all payments or
distributions under this Agreement and the LTIP, and (ii)
any obligation of the Corporation to pay or distribute cash
or any other property under this Agreement is subject to and
conditioned upon the Corporation having the right to do so
without violating the terms of any covenant or agreement of
the Corporation or any of its Subsidiaries.
To the extent the Award is forfeited, any and all
rights of the Employee under this Agreement shall cease and
terminate with respect to such forfeited Award, or portion
thereof, without any further obligation on the part of the
Corporation.
Capitalized terms not otherwise defined herein shall
have the meanings set forth for such terms in the LTIP (or
its successor).
6. Adjustments in Awards.
In the event of a stock dividend, stock split, merger,
consolidation, re-organization, re-capitalization or other
change in the corporate structure of the Corporation,
appropriate adjustments shall be made by the Board of
Directors to the Award.
7. Section 409A Compliance.
This Agreement is intended to avoid, and not otherwise
be subject to, the income inclusion requirements, interest
and penalty taxes of Section 409A of the Code, and the
regulations and other guidance issued thereunder, and shall
be interpreted in a manner consistent with that intent.
Notwithstanding the foregoing, in the event there is a
failure to comply with Section 409A of the Code, the
Corporation and the Committee shall have the discretion to
accelerate the time of payment of the Shares covered by the
Award, but only to the extent of the amount required to be
included in income as a result of such failure. Amendments
to this Agreement and/or the LTIP (or its successor) may be
made by the Corporation, without the Employee's consent, in
order to ensure compliance with Section 409A of the Code and
the regulations and other guidance issued thereunder.
8. Securities Law Requirements.
Notwithstanding any provision in this Agreement to the
contrary, the Corporation shall not be required to make any
distribution of Shares pursuant to this Award during such
period that the Corporation reasonably anticipates that such
distribution will violate federal securities laws or other
applicable law. The Corporation may require the Employee to
furnish to the Corporation, prior to the issuance of any
Shares hereunder, an agreement, in such form as the
Corporation may from time to time deem appropriate, in which
the Employee represents that the Shares acquired by him or
her hereunder are being acquired for investment and not with
a view to the sale or distribution thereof.
IN WITNESS HEREOF, this Agreement is entered into as of
the date first above written.
Employee AMR CORPORATION
_______________________ __________________________
Kenneth W. Wimberly
Corporate Secretary
Grant of Deferred
Shares
July 23, 2007
# of
Deferred
Shares
Officer Granted
Name
G. J. Arpey 20,000
T. W. Horton 7,500
D. P. Garton 10,700
G. F. Kennedy 4,250
W. R. Reding 4,250