UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For Quarter Ended March 31, 1995, Commission File Number 1-6033
UAL CORPORATION
(Exact name of Registrant as specified in its charter)
Delaware 36-2675207
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1200 East Algonquin Road, Elk Grove Township, Illinois 60007
Mailing Address: P. O. Box 66919, Chicago, Illinois 60666
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (708) 952-4000
Indicate by check mark whether the Registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months (or
for such shorter period that the Registrant was required to file
such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes X No
Indicate the number of shares outstanding of each of the issuer's
classes of common stock, as of the latest practicable date.
Outstanding at
Class April 27, 1995
Common Stock ($0.01 par value) 12,389,263
UAL Corporation and Subsidiary Companies Report on Form 10-Q
For the Quarter Ended March 31, 1995
Index
Part I. Financial Information Page No.
Item 1. Financial statements:
Condensed statement of consolidated 3
financial position - as of March 31, 1995
(unaudited) and December 31, 1994
Statement of consolidated operations 5
(unaudited) - for the three months
ended March 31, 1995 and 1994
Condensed statement of consolidated 6
cash flows (unaudited) - for the three
months ended March 31, 1995 and 1994
Notes to consolidated financial 7
statements (unaudited)
Item 2. Management's discussion and analysis 11
of financial condition and results of
operations
Part II. Other Information
Item 1. Legal Proceedings 16
Item 6. Exhibits and Reports on Form 8-K 16
Signatures 20
Exhibit Index 21
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
UAL Corporation and Subsidiary Companies
Condensed Statement of Consolidated Financial Position
(In Millions)
March 31,
1995 December 31,
Assets (Unaudited) 1994
Current assets:
Cash and cash equivalents $ 529 $ 500
Short-term investments 1,176 1,032
Receivables, net 988 889
Inventories, net 294 285
Deferred income taxes 152 151
Prepaid expenses and other 268 335
3,407 3,192
Operating property and equipment:
Owned 10,853 10,824
Accumulated depreciation and amortization (4,897) (4,786)
5,956 6,038
Capital leases 1,132 1,132
Accumulated amortization (460) (447)
672 685
6,628 6,723
Other assets:
Intangibles, net 799 814
Deferred income taxes 494 480
Other 493 555
1,786 1,849
$11,821 $11,764
See accompanying notes to consolidated financial statements.
UAL Corporation and Subsidiary Companies
Condensed Statement of Consolidated Financial Position
(In Millions)
March 31,
1995 December 31,
Liabilities and Stockholders' Equity (Unaudited) 1994
Current liabilities:
Short-term borrowings $ 269 $ 269
Current portions of long-term debt
and capital lease obligations 203 460
Advance ticket sales 1,275 1,020
Accounts payable 596 651
Other 2,567 2,506
4,910 4,906
Long-term debt 2,893 2,887
Long-term obligations under capital leases 699 730
Other liabilities and deferred credits:
Deferred pension liability 574 520
Postretirement benefit liability 1,169 1,148
Deferred gains 1,340 1,363
Other 414 477
3,497 3,508
Minority interest 51 49
Stockholders' equity:
Preferred stock - -
Common stock at par - -
Additional capital invested 1,383 1,287
Retained earnings (deficit) (1,348) (1,335)
Unearned ESOP preferred stock (81) (83)
Other (183) (185)
(229) (316)
Commitments and contingent liabilities
(See note)
$11,821 $11,764
See accompanying notes to consolidated financial statements.
UAL Corporation and Subsidiary Companies
Statement of Consolidated Operations (Unaudited)
(In Millions, Except Per Share)
Three Months
Ended March 31
1995 1994
Operating revenues:
Passenger $2,920 $2,771
Cargo 175 164
Other operating revenues 239 260
3,334 3,195
Operating expenses:
Salaries and related costs 1,113 1,202
ESOP compensation expense 89 -
Aircraft fuel 378 370
Commissions 342 334
Aircraft rent 249 226
Purchased services 239 218
Depreciation and amortization 163 178
Landing fees and other rent 169 152
Food services 119 91
Aircraft maintenance 107 109
Personnel expenses 63 59
Other operating expenses 265 292
3,296 3,231
Earnings (loss) from operations 38 (36)
Other income (expense):
Interest expense (102) (83)
Interest capitalized 12 10
Interest income 22 17
Equity in earnings of affiliates 14 6
Miscellaneous, net 22 (22)
(32) (72)
Earnings (loss) before income taxes and
cumulative effect of accounting change 6 (108)
Provision (credit) for income taxes 3 (37)
Earnings (loss) before cumulative
effect of accounting change 3 (71)
Cumulative effect of accounting change,
net of tax - (26)
Net earnings (loss) $ 3 $ (97)
Per share:
Loss before cumulative effect of
accounting change $(1.05) $(3.31)
Cumulative effect of accounting change - (1.06)
Net loss $(1.05) $(4.37)
Average shares 12.3 24.5
See accompanying notes to consolidated financial statements.
UAL Corporation and Subsidiary Companies
Condensed Statement of Consolidated Cash Flows (Unaudited)
(In Millions)
Three Months
Ended March 31
1995 1994
Cash and cash equivalents at beginning of
period $ 500 $ 437
Cash flows from operating activities 454 317
Cash flows from investing activities:
Additions to property and equipment (82) (75)
Proceeds on disposition of property and
equipment 132 96
Decrease (increase) in short-term
investments (145) 387
Other, net (4) 6
(99) 414
Cash flows from financing activities:
Repayment of long-term debt (267) (13)
Principal payments under capital
lease obligations (41) (55)
Decrease in short-term borrowings - (46)
Other, net (18) (8)
(326) (122)
Increase in cash and cash equivalents 29 609
Cash and cash equivalents at end of period $ 529 $ 1,046
Cash paid during the period for:
Interest (net of amounts capitalized) $ 79 $ 85
Income taxes $ 5 $ 1
Non-cash transactions:
Long-term debt incurred in connection
with additions to equipment $ 4 $ 5
Unrealized loss on investments $ 2 $ 3
See accompanying notes to consolidated financial statements.
UAL Corporation and Subsidiary Companies
Notes to Consolidated Financial Statements (Unaudited)
The Company
UAL Corporation ("UAL") is a holding company whose principal
subsidiary is United Air Lines, Inc. ("United").
Interim Financial Statements
The consolidated financial statements included herein have been
prepared pursuant to the rules and regulations of the Securities and
Exchange Commission. Certain information and footnote disclosures
normally included in financial statements prepared in accordance with
generally accepted accounting principles have been condensed or omitted
pursuant to or as permitted by such rules and regulations, although UAL
believes that the disclosures are adequate to make the information
presented not misleading. In management's opinion, all adjustments
(which, except for the effects of the employee investment transaction,
include only normal recurring adjustments) necessary for a fair
presentation of the results of operations for the three month periods
have been made. These financial statements should be read in
conjunction with the consolidated financial statements and footnotes
thereto included in UAL's Annual Report on Form 10-K for the year 1994.
ESOP Compensation Expense
"ESOP compensation expense" in the 1995 first quarter represents
the estimated average fair value of ESOP convertible preferred stock
committed to be released to employees for the period, net of amounts
used to satisfy dividend requirements for previously allocated ESOP
convertible preferred shares, under Employee Stock Ownership Plans which
were created as a part of the July 1994 employee investment transaction
and recapitalization.
Other Income (Expense) - Miscellaneous
Included in "Miscellaneous, net" in the first quarter of 1995 was
a $38 million gain on disposition of aircraft owned by Air Wisconsin,
Inc. Included in the first quarter of 1994 was a charge of $19 million
for costs incurred in connection with the employee investment
transaction. In addition, the 1995 and 1994 periods included foreign
exchange losses of $8 million and $1 million, respectively.
Income Taxes
The provision for income taxes for the first quarter of 1995 is
based on the estimated annual effective tax rate, which differs from the
federal statutory rate of 35% principally due to state income taxes and
certain nondeductible expenses. The credit for income taxes for the
first quarter of 1994 was based on the actual effective tax rate for the
quarter, and includes the effects of nondeductible expenses related to
the employee investment transaction and recapitalization. Deferred tax
assets are recognized based upon UAL's history of operating earnings and
expectations for future taxable income.
Accounting Change
UAL adopted Statement of Financial Accounting Standards ("SFAS")
No. 112, "Employers' Accounting for Postemployment Benefits," effective
January 1, 1994. The effect of adopting SFAS No. 112 was a cumulative
charge for recognition of the transition liability of $42 million,
before tax benefits of $16 million.
Per Share Amounts
Per share amounts were based on weighted average common shares
outstanding and were calculated after providing for cash dividends on
preferred stock of $13 million and $9 million in the first quarter of
1995 and 1994, respectively, and stock dividends on ESOP convertible
preferred stock of $3 million in the first quarter of 1995. Common
stock equivalents, including ESOP shares outstanding or committed to be
released, were not included in the computations as they did not have a
dilutive effect.
In connection with the July 1994 recapitalization, each old common
share was exchanged for one half new common share. As required under
generally accepted accounting principles for transactions of this type,
the historical weighted average shares outstanding have not been
restated. Thus, direct comparisons between first quarter 1995 and 1994
per share amounts are not meaningful.
Affiliates
United owns 38% of the Galileo International Partnership
("Galileo") through a wholly-owned subsidiary. United's investment in
Galileo, which owns the Apollo and Galileo computer reservations
systems, is carried on the equity basis. United also owns 77% of the
Apollo Travel Services Partnership and its accounts are consolidated.
Under operating agreements with Galileo, United purchases computer
reservation services from Galileo and provides marketing, sales and
communication services to Galileo. Revenues derived from the sale of
services to Galileo amounted to approximately $62 million in the 1995
first quarter and $59 million in the 1994 first quarter. The cost to
United of services purchased from Galileo amounted to approximately $25
million in the 1995 first quarter and $21 million in the 1994 first
quarter.
Long-term Debt
In addition to scheduled principal payments in the first quarter
of 1995, United repaid $150 million in principal amount of debentures
and $101 million in principal amount of secured notes, resulting in an
insignificant loss.
Contingencies and Commitments
UAL has certain contingencies resulting from litigation and claims
(including environmental issues) incident to the ordinary course of
business. Management believes, after considering a number of factors,
including (but not limited to) the views of legal counsel, the nature of
contingencies to which UAL is subject and its prior experience, that the
ultimate disposition of these contingencies is not expected to
materially affect UAL's consolidated financial position or results of
operations.
At March 31, 1995, commitments for the purchase of property and
equipment, principally aircraft, approximated $3.9 billion, after
deducting advance payments. An estimated $1.2 billion will be spent
during the remainder of 1995, $0.7 billion in 1996, $1.3 billion in
1997, $0.4 billion in 1998 and $0.3 billion in 1999 and therafter. The
major commitments are for the purchase of thirty-four B777 aircraft
which are expected to be delivered between 1995 and 1999.
In addition to the B777 order, United has arrangements with Airbus
Industrie and International Aero Engines to lease an additional 24 A320
aircraft, which are scheduled for delivery through 1998. At March 31,
1995, United also had options for an additional 156 B737 aircraft, 36
B757 aircraft, 34 B777 aircraft, 44 B747 aircraft, 8 B767 aircraft and
48 A320 aircraft. These amounts reflect the recent cancellation of
certain options. Under the terms of certain of these remaining options
which are exercisable during 1996 and 1997, United would forfeit
significant deposits on such options it does not exercise. In April
1995, United confirmed options for two B747 aircraft and ordered four
B757 aircraft, agreeing to take delivery of the aircraft in 1996. The
four B757 orders replace options for two B767 aircraft. These orders
will increase United's capital expenditures in 1996 by approximately
$0.5 billion.
Sale of Aircraft
In the first quarter of 1995, Air Wisconsin, Inc. sold ten Dash 8
aircraft to Mesa Airlines. The sale resulted in a pre-tax gain of $38
million. In connection with the sale, United agreed to a ten-year
extension of its United Express marketing agreement with Mesa Airlines.
Exchange of Debentures for Preferred Stock
In April 1995, UAL issued $600 million in principal amount of
6 3/8% convertible subordinated debentures due 2025 in exchange for all
outstanding shares of its Series A convertible preferred stock. The
debentures are convertible into a combination of $541.90 in cash and
approximately 3.192 shares of UAL common stock (equivalent to a
conversion price of $143.50 per share of common stock) for each $1,000
in principal amount.
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
LIQUIDITY AND CAPITAL RESOURCES
UAL's total of cash and cash equivalents and short-term
investments was $1.705 billion at March 31, 1995, compared to $1.532
billion at December 31, 1994. Cash flows from operating activities
amounted to $454 million. Investing activities, excluding the increase
in short-term investments, resulted in cash flows of $46 million.
Financing activities included principal payments under debt and capital
lease obligations of $267 million and $41 million, respectively.
In the first quarter of 1995, United took delivery of five A320
aircraft under operating leases. Property additions, including aircraft
spare parts, amounted to $82 million. Property dispositions, including
the sale of Dash 8 aircraft by Air Wisconsin, Inc., resulted in proceeds
of $132 million.
At March 31, 1995, commitments for the purchase of property and
equipment, principally aircraft, approximated $3.9 billion, after
deducting advance payments. An estimated $1.2 billion will be spent
during the remainder of 1995, $0.7 billion in 1996, $1.3 billion in
1997, $0.4 billion in 1998 and $0.3 billion in 1999 and thereafter. The
major commitments are for the purchase of thirty-four B777 aircraft
which are expected to be delivered between 1995 and 1999.
In addition to aircraft orders, United has arrangements with
Airbus Industrie and International Aero Engines to lease 24 A320
aircraft, which are scheduled for delivery through 1998. At March 31,
1995, United also had options for an additional 156 B737 aircraft, 36
B757 aircraft, 34 B777 aircraft, 44 B747 aircraft, 8 B767 aircraft and
48 A320 aircraft. Under the terms of certain of these options which are
exercisable during 1996 and 1997, United would forfeit significant
deposits on such options it does not exercise.
In April 1995, United confirmed options for two B747 aircraft and
ordered four B757 aircraft, agreeing to take delivery of the aircraft in
1996. The four B757 orders replace options for two B767 aircraft.
These orders will increase United's capital expenditures in 1996 by
approximately $0.5 billion. Also in April 1995, United announced that,
under a revised fleet plan, it would use most of the new aircraft to be
delivered through 1997 to replace older aircraft in its fleet. As a
result, the number of aircraft in United's operating fleet is expected
to increase by 19 during that time, compared to an increase of 48
aircraft called for by United's previous fleet plan. Funds necessary to
finance aircraft acquisitions are expected to be obtained from
internally generated funds, irrevocable external financing arrangements
or other external sources.
At March 31, 1995, UAL and United had an effective shelf
registration statement on file with the Securities and Exchange
Commission to offer up to $1.035 billion of securities, including
secured and unsecured debt, equipment trust and pass through
certificates, equity or a combination thereof. UAL's ability to issue
equity securities is limited by its certificate of incorporation, which
was restated in connection with the recapitalization. In the second
quarter of 1995, United expects to issue pass through certificates under
the shelf registration statement to finance or refinance certain
aircraft under operating leases.
RESULTS OF OPERATIONS
UAL's results of operations for interim periods are not
necessarily indicative of those for an entire year, as a result of
seasonal factors to which United is subject. First and fourth quarter
results are normally affected by reduced travel demand in the fall and
winter and United's operations, particularly at its Chicago and Denver
hubs, are adversely affected by winter weather on occasion.
The results of operations in the airline business historically
fluctuate significantly in response to general economic conditions.
This is because small fluctuations in yield (passenger revenue per
revenue passenger mile) and cost per available seat mile can have a
significant effect on operating results. UAL anticipates industrywide
fare levels, increasing low-cost competition, general economic
conditions, fuel costs, international governmental policies and other
factors will continue to affect its operating results.
The July 1994 employee investment transaction and recapitalization
resulted in wage and benefit reductions and work-rule changes which were
designed to reduce cash operating expenses. These cash expense
reductions are offset by non-cash compensation charges for stock
periodically committed to be released to employees under the ESOPs and
additional interest expense on the debentures issued at the time of the
recapitalization.
As a result of the recapitalization, UAL's capital structure
became more highly leveraged. With the increase in debt and reduction
in equity resulting from the recapitalization, UAL's exposure to certain
industry risks could be greater than might have been the case prior to
the recapitalization. In addition, the transaction resulted in new
labor agreements for certain employee groups and a new corporate
governance structure, which was designed to achieve balance between the
various employee-owner groups and public stockholders. The new labor
agreements and governance structure could inhibit management's ability
to alter strategy in a volatile, competitive industry by restricting
certain operating and financing activities, including the sale of assets
and the issuance of equity securities and the ability to furlough
employees. UAL's ability to react to competition may be hampered
further by the fixed long-term nature of these various agreements. The
success of the recapitalization is dependent upon a number of factors,
including the state of the competitive environment in the airline
industry, competitive responses to United's efforts, United's ability to
achieve enduring cost savings through productivity improvements and the
renegotiation of labor agreements at the end of the investment period.
In the first quarter of 1995, United implemented a new travel
agency commission payment plan that offers a maximum of $50 for
round-trip domestic tickets and a maximum of $25 for one-way domestic
tickets. The new commission plan resulted in a slight reduction of
United's commission expense in the first quarter of 1995; however, it is
expected to have a more significant impact in future quarters.
Litigation challenging this payment plan is pending.
Summary of Results and Impact of Recapitalization
UAL's earnings from operations were $38 million in the first
quarter of 1995, an improvement of $74 million from an operating loss of
$36 million in the first quarter of 1994. UAL's net earnings in the
first quarter of 1995 were $3 million (a loss of $1.05 per share after
preferred stock dividends), compared to a net loss of $97 million in the
first quarter of 1994 ($4.37 per share). The 1994 loss includes a $26
million after tax charge for the cumulative effect of adopting Statement
of Financial Accounting Standards No. 112, "Employers' Accounting for
Postemployment Benefits," which UAL adopted effective January 1, 1994.
In connection with the recapitalization, each share of old common
stock was converted to one half share of new common stock (and cash in
lieu of fractional shares) and $84.81 in cash. As a result, the number
of outstanding shares was reduced proportionately. Accordingly, the
weighted average shares in the earnings per share calculations are based
on the number of old common shares outstanding prior to the
recapitalization and the reduced number of new common shares outstanding
subsequent to the transaction. Thus, a direct comparison between first
quarter 1995 and 1994 per share amounts is not meaningful. The ESOP
shares outstanding or committed to be released were not included in the
1995 first quarter earnings per share computation as they did not have a
dilutive effect.
Management believes that a more complete understanding of UAL's
results can be gained by viewing them on a pro forma, "fully
distributed" basis. This approach considers all ESOP shares which will
ultimately be distributed to employees throughout the ESOP (rather than
just the shares committed to be released) to be immediately outstanding
and thus fully distributed. Consistent with this method, the ESOP
compensation expense is excluded from fully distributed net earnings and
ESOP convertible preferred stock dividends are excluded from earnings
attributable to common stockholders. On a fully distributed basis,
UAL's net earnings for the 1995 first quarter would have been $59
million ($1.50 per share) compared to $3 million (loss of $1.05 per
share) as reported under generally accepted accounting principles.
Specific factors affecting UAL's consolidated operations for the
first quarter of 1995 are described below.
First Quarter 1995 Compared with First Quarter 1994.
Operating revenues increased $139 million (4%). However, United's
revenue per available seat mile decreased 1% to 8.83 cents. Passenger
revenues increased $149 million (5%) due principally to an 8% increase
in revenue passenger miles, partially offset by a 2% decrease in yield
to 11.56 cents. Domestic revenue passenger miles increased 10%, Pacific
increased 8% and Latin America increased 3%. Atlantic revenue passenger
miles decreased 4%. Available seat miles increased 6% systemwide, as
increases of 16% and 4% on Pacific and Domestic routes, respectively,
were partially offset by a 4% decrease in the Atlantic. As a result,
United's system passenger load factor increased 1.6 points to 67.0%.
Cargo revenues increased $11 million (7%), as both freight and
mail revenues increased due to higher cargo volumes. Other operating
revenues decreased $21 million (8%) due to a decrease in fuel sales.
Operating expenses increased $65 million (2%); however, United's
cost per available seat mile decreased 3% from 9.04 cents to 8.73 cents,
including ESOP compensation expense. Without the ESOP compensation
expense, United's 1995 first quarter cost per available seat mile would
have been 8.49 cents. ESOP compensation expense of $89 million in the
1995 first quarter represents the estimated average fair value of ESOP
stock committed to be released to employees for the quarter, net of
amounts used to satisfy dividend requirements for previously allocated
ESOP convertible preferred shares. Food services increased $28 million
(31%) due to the new catering arrangements resulting from the 1994 sale
of flight kitchens and increased passenger volumes. Aircraft rent
increased $23 million (10%) as a result of new aircraft acquired on
operating leases. Purchased services increased $21 million (10%) due
principally to volume-related increases in computer reservations fees
and credit card discounts. Landing fees and other rent increased $17
million (11%) due to increased facilities rent, partially due to new
facilities at Denver, and increased landing fees as the number of
departures increased 10%. Aircraft fuel expense increased $8 million
(2%) as a 5% increase in consumption was partially offset by a 3%
decrease in the average price per gallon of fuel to 56.8 cents. Other
operating expenses decreased $27 million (9%) due mainly to lower fuel
sales.
Salaries and related costs decreased $89 million (7%) primarily
due to savings resulting from ESOP related wage and benefit concessions.
Depreciation and amortization expense decreased $15 million (8%), as
certain assets, principally B727 aircraft, are now fully depreciated.
Other expense amounted to $32 million in the first quarter of 1995
compared to $72 million in the first quarter of 1994. Interest expense
increased $19 million (23%) due primarily to interest on the debentures
issued in connection with the recapitalization. Included in
"Miscellaneous, net" in the first quarter of 1995 was a $38 million gain
on the disposition of ten Dash 8 aircraft owned by Air Wisconsin, Inc.
Included in the first quarter of 1994 was a charge of $19 million for
costs incurred in connection with the employee investment transaction.
In addition, the 1995 and 1994 periods included foreign exchange losses
of $8 million and $1 million, respectively.
Part II
Other Information
Item 1. Legal Proceedings.
In Re Airline Travel Agency Commission Litigation. On
February 13, l995 and dates thereafter United Air Lines, Inc.
("United"), a wholly owned subsidiary of UAL Corporation ("UAL"),
and six other airlines were sued in various courts around the
nation by travel agents and the American Society of Travel Agents
claiming as a class action that the carriers acted collusively in
violation of federal antitrust laws when they imposed a cap on
ticket sales commissions payable to travel agencies by the
carriers. Most of the suits are now consolidated before the
federal court in Minneapolis. A discovery and motion filing
schedule has been established by this court, which provides for a
hearing on July 7, 1995 on plaintiffs' motion for a preliminary
injunction and the carriers' motion for summary judgment. A multi-
district panel will decide on May 19 whether all the cases should
be consolidated in Minneapolis or, as requested by some
plaintiffs, in Philadelphia. As relief, the plaintiffs seek an
order declaring the carriers commission cap action to be illegal
and the recovery of damages (trebled) to the agencies resulting
from that action.
Summers et al. v. State Street Bank and Trust Company et al.
On April 14, 1995, plaintiffs filed a class action complaint
against State Street Bank and Trust Company ("State Street"), the
UAL Corporation Employee Stock Ownership Plan and the UAL
Corporation Supplemental Employee Stock Ownership Plan (together,
the "Plans") in the United States District Court for the Northern
District of Illinois. The complaint is brought on behalf of a
putative class of all persons who are, or were as of July 12,
1994, participants or beneficiaries of the Plans. Plaintiffs
allege that State Street breached various fiduciary duties under
the Employee Retirement Income Security Act of 1974 ("ERISA") in
connection with the 1994 purchase of UAL preferred stock by the
Plans. The Plans are nominal defendants; no relief is sought from
them. The complaint seeks a declaration that State Street
violated ERISA, restoration to the Plans by State Street of the
amount of an alleged "overpayment" for the stock, and other
relief. United is obligated, subject to certain exceptions, to
indemnify State Street for part or all of an adverse judgment and
State Street's defense costs.
Item 6. Exhibits and Reports on Form 8-K.
(a)Exhibit 4.1 - Indenture dated as of April 3, 1995
between UAL Corporation and The Bank of New York, as
Trustee.
Exhibit 4.2 - Officer's Certificate relating to UAL
Corporation's 6-3/8% Convertible Subordinated
Debentures due 2025.
Exhibit 4.3 - Form of UAL Corporation's 6-3/8%
Convertible Subordinated Debenture due 2025.
Exhibit 10.1 - First Amendment to UAL Corporation
Supplemental ESOP, dated February 22, 1995 and
effective as of July 12, 1994.
Exhibit 10.2 - Letter Agreement Amendment No. 6-1162-MMF-
077 dated April 3, 1995 to the Agreement dated December
18, 1990 between The Boeing Company and United (and
United Worldwide Corporation) for acquisition of 777-200
aircraft (as previously amended and supplemented, the
"777-200 Purchase Agreement" (filed as Exhibit 10.7 to
UAL's annual report on Form 10-K for the year ended
December 31, 1990, and supplements thereto filed as (i)
Exhibits 10.1, 10.2 and 10.22 to UAL's quarterly report
on Form 10-Q for the quarter ended June 30, 1993, (ii)
Exhibit 10.2 to UAL's annual report on Form 10-K for the
year ended December 31, 1993, (iii) Exhibit 10.14 to
UAL's quarterly report on Form 10-Q for the quarter ended
June 30, 1994, and (iv) Exhibits 10.27 and 10.28 to UAL's
annual report on Form 10-K for the year ended December
31, 1994)). (Exhibit 10.2 hereto is filed with a request
for confidential treatment of certain portions.)
Exhibit 10.3 - Letter Agreement Amendment No. 6-1162-RCN-
837 dated February 17, 1995 to the 777-200 Purchase
Agreement. (Exhibit 10.3 hereto is filed with a request
for confidential treatment of certain portions.)
Exhibit 10.4 - Supplemental Agreement No. 6 dated as of
April 13, 1995 to the Agreement dated December 18, 1990
between The Boeing Company and United (and United
Worldwide Corporation) for acquisition of 747-400
aircraft (as previously amended and supplemented, the
"747-400 Purchase Agreement" (filed as Exhibit 10.8 to
UAL's annual report on Form 10-K for the year ended
December 31, 1990, and supplements thereto filed as (i)
Exhibits 10.4 and 10.5 to UAL's annual report on Form 10-
K for the year ended December 31, 1991, (ii) Exhibits
10.3, 10.4, 10.5, 10.6 and 10.22 to UAL's quarterly
report on Form 10-Q for the quarter ended June 30, 1993,
(iii) Exhibit 10.3 to UAL's annual report on Form 10-K
for the year ended December 31, 1993, (iv) Exhibit 10.14
to UAL's quarterly report on Form 10-Q for the quarter
ended June 30, 1994, and (v) Exhibits 10.29 and 10.30 to
UAL's annual report on Form 10-K for the year ended
December 31, 1994)). (Exhibit 10.4 hereto is filed with
a request for confidential treatment of certain
portions.)
Exhibit 10.5 - Letter Agreement Amendment 6-1162-DLJ-
891R2 dated April 13, 1995 to the 747-400 Purchase
Agreement. (Exhibit 10.5 hereto is filed with a request
for confidential treatment of certain portions.)
Exhibit 10.6 - Letter Agreement Amendment 6-1162-MMF-084
dated April 13, 1995 to the 747-400 Purchase Agreement.
(Exhibit 10.6 hereto is filed with a request for
confidential treatment of certain portions.)
Exhibit 10.7 - Letter Agreement Amendment 6-1162-RCN-870
dated April 13, 1995 to the 747-400 Purchase Agreement.
(Exhibit 10.7 hereto is filed with a request for
confidential treatment of certain portions.)
Exhibit 10.8 - Change Order No. 1 dated April 13, 1995 to
the 747-400 Purchase Agreement. (Exhibit 10.8 hereto is
filed with a request for confidential treatment of
certain portions.)
Exhibit 10.9 - Supplemental Agreement No. 5 dated as of
April 13, 1995 to the Agreement dated April 26, 1989
between The Boeing Company and United for acquisition of
757-200 and 737 aircraft (as relates solely to the 757-
200 aircraft and as previously amended and supplemented,
the "757-200 Purchase Agreement" (filed as Exhibit 10(K)
to UAL's Form 10-K for the year ended December 31, 1989,
and supplements thereto filed as (i) Exhibits 10.14,
10.15, 10.16, 10.17, 10.18, 10.19, and 10.22 to UAL's
Quarterly Report on Form 10-Q for the quarter ended June
30, 1993, and (ii) Exhibit 10.14 to UAL's quarterly
report on Form 10-Q for the quarter ended June 30,
1994)). (Exhibit 10.9 hereto is filed with a request for
confidential treatment of certain portions.)
Exhibit 10.10 - Supplemental Agreement No. 11 dated as of
April 13, 1995 to the Agreement dated March 1, 1990
between The Boeing Company and United for acquisition of
767-300ER aircraft (as previously amended and
supplemented, the "767-300ER Purchase Agreement" (filed
as Exhibit 10(L) to UAL's Form 10-K for the year ended
December 31, 1989, and supplements thereto filed as (i)
Exhibits 10.7, 10.8, 10.9, 10.10, 10.11, 10.12, 10.13 and
10.22 to UAL's Quarterly Report on Form 10-Q for the
quarter ended June 30, 1993, and (ii) Exhibit 10.14 to
UAL's quarterly report on Form 10-Q for the quarter ended
June 30, 1994)). (Exhibit 10.10 hereto is filed with a
request for confidential treatment of certain portions.)
Exhibit 10.11 - Letter Agreement Amendment 6-1162-DLJ-
472R2 dated April 13, 1995 to the 767-300ER Purchase
Agreement. (Exhibit 10.11 hereto is filed with a request
for confidential treatment of certain portions.)
Exhibit 10.12 - Agreement dated as of March 24, 1995 between
United, UAL and James M. Guyette.
Exhibit 11 - Calculation of fully diluted net
earnings per share.
Exhibit 12.1 - Computation of Ratio of
Earnings to Fixed Charges.
Exhibit 12.2 - Computation of Ratio of
Earnings to Fixed Charges and Preferred Stock
Dividend Requirements.
Exhibit 27 - Financial Data Schedule.
(b)Form 8-K dated February 28, 1995 to report Selected
Financial Data, Management's Discussion and Analysis of
Financial Condition and Results of Operations and audited
financial statements for, among other things, the year
ended December 31, 1994.
Form 8-K dated March 21, 1995 to report News For
Investors issued to investors and analysts by UAL
Corporation.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the Registrant has duly caused this report to be signed on
its behalf by the undersigned thereunto duly authorized.
UAL CORPORATION
By: /s/ Gerald Greenwald
Gerald Greenwald
Chairman and Chief
Executive Officer
By: /s/ Douglas A. Hacker
Douglas A. Hacker
Senior Vice President - Finance
(Principal Financial
and Accounting Officer)
Dated: May 1, 1995
Exhibit Index
Exhibit No. Description
4.1 Indenture dated as of April 3, 1995 between UAL
Corporation and The Bank of New York, as Trustee.
4.2 Officer's Certificate relating to UAL
Corporation's 6-3/8% Convertible Subordinated
Debentures due 2025.
4.3 Form of UAL Corporation's 6-3/8% Convertible
Subordinated Debenture due 2025.
10.1 First Amendment to UAL Corporation Supplemental
ESOP, dated February 22, 1995 and effective as of
July 12, 1994.
10.2 Letter Agreement Amendment No. 6-1162-MMF-077 dated
April 3, 1995 to the Agreement dated December 18, 1990
between The Boeing Company and United (and United
Worldwide Corporation) for acquisition of 777-200
aircraft (as previously amended and supplemented, the
"777-200 Purchase Agreement" (filed as Exhibit 10.7 to
UAL's annual report on Form 10-K for the year ended
December 31, 1990, and supplements thereto filed as (i)
Exhibits 10.1, 10.2 and 10.22 to UAL's quarterly report
on Form 10-Q for the quarter ended June 30, 1993, (ii)
Exhibit 10.2 to UAL's annual report on Form 10-K for the
year ended December 31, 1993, (iii) Exhibit 10.14 to
UAL's quarterly report on Form 10-Q for the quarter
ended June 30, 1994, and (iv) Exhibits 10.27 and 10.28
to UAL's annual report on Form 10-K for the year ended
December 31, 1994)). (Exhibit 10.2 hereto is filed with
a request for confidential treatment of certain
portions.)
10.3 Letter Agreement Amendment No. 6-1162-RCN-837 dated
February 17, 1995 to the 777-200 Purchase Agreement.
(Exhibit 10.3 hereto is filed with a request for
confidential treatment of certain portions.)
10.4 Supplemental Agreement No. 6 dated as of April 13,
1995 to the Agreement dated December 18, 1990 between
The Boeing Company and United (and United Worldwide
Corporation) for acquisition of 747-400 aircraft (as
previously amended and supplemented, the "747-400
Purchase Agreement" (filed as Exhibit 10.8 to UAL's
annual report on Form 10-K for the year ended December
31, 1990, and supplements thereto filed as (i) Exhibits
10.4 and 10.5 to UAL's annual report on Form 10-K for
the year ended December 31, 1991, (ii) Exhibits 10.3,
10.4, 10.5, 10.6 and 10.22 to UAL's quarterly report on
Form 10-Q for the quarter ended June 30, 1993, (iii)
Exhibit 10.3 to UAL's annual report on Form 10-K for the
year ended December 31, 1993, (iv) Exhibit 10.14 to
UAL's quarterly report on Form 10-Q for the quarter
ended June 30, 1994, and (v) Exhibits 10.29 and 10.30 to
UAL's annual report on Form 10-K for the year ended
December 31, 1994)). (Exhibit 10.4 hereto is filed with
a request for confidential treatment of certain
portions.)
10.5 Letter Agreement Amendment 6-1162-DLJ-891R2 dated
April 13, 1995 to the 747-400 Purchase Agreement.
(Exhibit 10.5 hereto is filed with a request for
confidential treatment of certain portions.)
10.6 Letter Agreement Amendment 6-1162-MMF-084 dated
April 13, 1995 to the 747-400 Purchase Agreement.
(Exhibit 10.6 hereto is filed with a request for
confidential treatment of certain portions.)
10.7 Letter Agreement Amendment 6-1162-RCN-870 dated
April 13, 1995 to the 747-400 Purchase Agreement.
(Exhibit 10.7 hereto is filed with a request for
confidential treatment of certain portions.)
10.8 Change Order No. 1 dated April 13, 1995 to the 747-
400 Purchase Agreement. (Exhibit 10.8 hereto is filed
with a request for confidential treatment of certain
portions.)
10.9 Supplemental Agreement No. 5 dated as of April 13,
1995 to the Agreement dated April 26, 1989 between The
Boeing Company and United for acquisition of 757-200 and
737 aircraft (as relates solely to the 757-200 aircraft
and as previously amended and supplemented, the "757-200
Purchase Agreement" (filed as Exhibit 10(K) to UAL's
Form 10-K for the year ended December 31, 1989, and
supplements thereto filed as (i) Exhibits 10.14, 10.15,
10.16, 10.17, 10.18, 10.19, and 10.22 to UAL's Quarterly
Report on Form 10-Q for the quarter ended June 30, 1993,
and (ii) Exhibit 10.14 to UAL's quarterly report on Form
10-Q for the quarter ended June 30, 1994)). (Exhibit
10.9 hereto is filed with a request for confidential
treatment of certain portions.)
10.10 Supplemental Agreement No. 11 dated as of April 13,
1995 to the Agreement dated March 1, 1990 between The
Boeing Company and United for acquisition of 767-300ER
aircraft (as previously amended and supplemented, the
"767-300ER Purchase Agreement" (filed as Exhibit 10(L)
to UAL's Form 10-K for the year ended December 31, 1989,
and supplements thereto filed as (i) Exhibits 10.7,
10.8, 10.9, 10.10, 10.11, 10.12, 10.13 and 10.22 to
UAL's Quarterly Report on Form 10-Q for the quarter
ended June 30, 1993, and (ii) Exhibit 10.14 to UAL's
quarterly report on Form 10-Q for the quarter ended June
30, 1994)). (Exhibit 10.10 hereto is filed with a
request for confidential treatment of certain portions.)
10.11 Letter Agreement Amendment 6-1162-DLJ-472R2 dated
April 13, 1995 to the 767-300ER Purchase Agreement.
(Exhibit 10.11 hereto is filed with a request for
confidential treatment of certain portions.)
10.12 Agreement dated as of March 24, 1995 between United, UAL
and James M. Guyette.
11 Calculation of fully diluted net earnings per
share.
12.1 Computation of Ratio of Earnings to Fixed
Charges.
12.2 Computation of Ratio of Earnings to Fixed
Charges and Preferred Stock Dividend Requirements.
27 Financial Data Schedule.