Annual Report — [x] Reg. S-K Item 405 — Form 10-K
Filing Table of Contents
Document/Exhibit Description Pages Size
1: 10-K405 Form 10-K for Fiscal Year End December 31, 1998 73 391K
2: EX-3.2 Bylaws of Amr, Amended November 18, 1998 23 57K
4: EX-10.15 Deferred Compensation Agreement - Edward Brennan 3 16K
5: EX-10.19 Deferred Compensation Agreement - Armando Codina 2 14K
6: EX-10.23 Deferred Compensation Agreement - Charles Fisher 2 15K
7: EX-10.27 Deferred Compensation Agreement - Charles Pistor 2 15K
3: EX-10.3 Compensation & Benefit Agreement 9 38K
8: EX-10.30 Deferred Compensation Agreement - Judith Rodin 2 14K
9: EX-10.34 1998 Long-Term Incentive Plan 19 77K
10: EX-10.37 Current Form of Stock Option Agreement 5 23K
11: EX-10.41 Current Form of Career Equity Program 8 29K
12: EX-10.42 Current Form of Career Equity Program-Non Officers 5 24K
13: EX-10.42(A) Current Form of Career Equity Program-Sr. 8 30K
Officers
14: EX-10.50 Performance Share Program for the Years 1999-2001 4 23K
15: EX-10.52 Amr Corporation 1987 Executive Deferral Plan 12 39K
16: EX-10.56 1999 Employee Profit Sharing Plan 5 22K
17: EX-10.60 American Airlines, Inc. 1999 Incentive Comp. Plan 6 26K
18: EX-10.61 Termination Benefits Agreement - Gerard J. Arpey 29 85K
19: EX-10.62 Termination Benefits Agreement - Robert W. Baker 29 85K
20: EX-10.63 Termination Benefits Agreement - Peter M. Bowler 29 85K
21: EX-10.64 Termination Benefits Agreement - Donald J. Carty 29 84K
22: EX-10.65 Termination Benefits Agreement - Peter J. Dolara 29 85K
23: EX-10.66 Termination Benefits Agreement - Daniel P. Garton 29 85K
24: EX-10.67 Termination Benefits Agreement - Michael W. Gunn 29 84K
25: EX-10.68 Termination Benefits Agreement - Thomas J. Kiernan 29 85K
26: EX-10.69 Termination Benefits Agreement - David L. Kruse 29 85K
27: EX-10.70 Termination Benefits Agreement - Charles Marlett 29 85K
28: EX-10.71 Termination Benefits Agreement - Anne McNamara 29 85K
29: EX-10.76 Aircraft Purchase Agreement 44 93K
30: EX-12 Computation of Ratio of Earnings to Fixed Charges 1 11K
31: EX-21 Subsidiaries of the Registrant 3 25K
32: EX-23 Consent of Independent Auditors 1 12K
33: EX-27.1 Financial Data Schedule 1 12K
34: EX-27.2 Restated Financial Data Schedule 1 12K
35: EX-27.3 Restated Financial Data Schedule 1 12K
EX-10.56 — 1999 Employee Profit Sharing Plan
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EXHIBIT 10.56
AMERICAN AIRLINES, INC.
1999 EMPLOYEE PROFIT SHARING PLAN
Purpose
The purpose of the 1999 American Airlines Employee Profit Sharing Plan ("Plan")
is to provide participating employees with a sense of commitment to, and direct
financial interest in, the success of American Airlines, Inc.
("American").
Definitions
Capitalized terms not otherwise defined in the Plan will have the meanings set
forth in the 1998 Long Term Incentive Plan, as amended.
"AMR" is defined as AMR Corporation.
"American" is defined as AMR Corporation less AMR subsidiaries other than
American Airlines, Inc.
"Committee" is defined as the AMR Incentive Compensation Committee.
"Fund" is defined as the profit sharing fund, if any, accumulated in accordance
with this plan.
"Qualified Earnings" is defined as base pay, overtime, holiday pay, skill
premiums, longevity pay, sick pay, vacation pay, shift differential, market rate
differential, overrides and license premiums and does not include such things as
travel and incidental expenses, moving expenses, relocation allowance (COLA),
payouts from any retirement plan, disability payments, Workers Compensation
payments, imputed income from D-3 service charges or Company provided life
insurance, nor does it include any special monetary awards or allowances such as
IdeAAs in Action payments, lump sum payments, or incentive compensation or
profit sharing payments.
"Plan Earnings" is defined as the sum of American's pre-tax income, interest
expense, aircraft rental expense, AMR Minority Interest Expense, and any
accruals for American's Pilot Variable Compensation Plan, TWU Profit Sharing
Plan, Employee Profit Sharing Plan, and Incentive Compensation Plan, less
Calculated Amortization of Operating Leases and any accounting adjustments or
extraordinary or unusual items which may be added or deducted at the discretion
of the Committee and approved by the Board of Directors.
1
"Adjusted Investment" is defined as the sum of American's notes payable, current
maturities of long term debt and capital leases, long term debt, capital leases,
present value of operating leases, and stockholders' equity, and any
extraordinary or unusual items which may be added or deducted at the discretion
of the Committee and the Board of Directors.
"Present Value of Operating Leases" is defined as the present value of the lease
payments required under American's aircraft operating leases over the remaining
lease term, calculated using a discount rate of Prime plus one percent. Amounts
for 3/31/99, 6/30/99, and 9/30/99 are computed by determining the difference
between the Present Value of Operating Leases as of 12/31/99 and 12/31/98 and
allocating that difference evenly over the four quarters of 1999.
"AMR Minority Interest Expense" is defined as outside stockholder's ownership in
AMR subsidiaries other than American Airlines, Inc.
"Capitalized Value of Operating Leases" is defined as the initial present value
of the lease payments required under American's aircraft operating leases over
the initial stated lease term, calculated using a discount rate of Prime plus
one percent.
"Calculated Amortization of Operating Leases" is defined as the amortization
expense associated with the Capitalized Value of Operating Leases and is
determined by the straight line method over the lease term.
"Prime" is defined as the base rate on Corporate Loans posted by at least 75% of
the 30 largest U.S. banks which is published daily in the Wall Street Journal.
"Average Adjusted Investment" is defined as the sum of Adjusted Investment as of
12/31/98, 3/31/99, 6/30/99, and 9/30/99, divided by four.
"Return on Investment" or "ROI" is defined as Plan Earnings divided by Average
Adjusted Investment, stated as a percentage.
"Affiliate" is defined as a subsidiary of AMR or any entity that is designated
by the Board as a participating employer under the Plan, provided that AMR
directly or indirectly owns at least 20% of the combined voting power of all
classes of stock of such entity.
Eligibility for Participation
In order to be eligible for a profit sharing award, the individual must:
o Have worked during the plan year as a regular full-time or part-time
employee at American in a participating workgroup (flight attendant,
reservations, coordinator/planner, airport agent, support staff, management
levels 04 and below).
2
o Must have completed six consecutive months of service as a regular employee
at American or an Affiliate during his/her tenure. If the six months
service requirement is fulfilled during the plan year, eligible earnings
from the time worked at American during those six months will be included
in the award calculation.
o Must be actively employed at American or an Affiliate at the time awards
are paid. If at the time awards are paid under the Plan, an individual has
retired from American or an Affiliate, has been laid off, is on a leave of
absence with re-instatement rights, is disabled or has died, the award
which the individual otherwise would have received under the Plan but for
such retirement, lay-off, leave, disability or death may be paid to the
individual or his/her estate in the event of death, at the discretion of
the Committee.
Notwithstanding the foregoing, however, an employee will not be eligible to
participate in the Plan if such employee is, at the same time, eligible to
participate in:
i) the 1999 American Airlines Incentive Compensation Plan for Officers
and Key Employees,
ii) the Pilot Profit Sharing (as implemented in 1997),
iii) the TWU Profit Sharing Plan for members of the Transport Workers
Union (as implemented in 1995 and revised in 1996),
iv) any incentive compensation, profit sharing, commission or other bonus
plan for employees of any division of American, or
v) any incentive compensation, profit sharing, commission or other bonus
plan sponsored by an Affiliate.
Profit Sharing awards will be determined on a proportionate basis for
participation in more than one plan. Employees who transfer from/to Affiliates
or any other plan described above, and satisfy aforementioned eligibility
requirements, will receive awards from each plan on a proportionate basis.
The Profit Sharing Fund Accumulation
Performance will be measured by ROI and the Fund will accumulate based on that
performance. The Fund is established at 1% of Qualified Earnings when ROI is
equal to 6.4%. The fund will accumulate on a straight-line basis at the rate of
0.583% of qualified earnings for each additional point of ROI.
The profit sharing fund will not exceed an amount equal to 8% of Qualified
Earnings at levels of ROI above 18.4%.
3
Award Distribution
For domestic employees, individual awards will be distributed based on an
employee's Qualified Earnings for the Plan year multiplied by the appropriate
percentage of Qualified Earnings based upon the ROI achieved for the Plan year.
The percent of Qualified Earnings used for fund accumulation and award
distribution will be the same.
A portion of the Fund will be allocated for international employees based on
eligible international employees' Qualified Earnings as a percentage of eligible
employees' total Qualified Earnings. This portion of the Fund will be set aside
for distribution at the discretion of the appropriate Officer, subject only to
the Committee's approval.
Administration
The Plan will be administered by a Committee comprised of officers of American
appointed by the Chairman of AMR. The Committee will have authority to
administer and interpret the Plan, establish administrative rules, determine
eligibility and take any other action necessary for the proper and efficient
operation of the Plan. The amount, if any, of the Fund shall be computed by the
General Auditor of American based on a certification of ROI by American's
independent auditors. A summary of awards under the Plan shall be provided to
the Board of Directors at the first regular meeting following determination of
the awards.
Method of Payment
The Committee shall determine the method of payment of awards. Awards shall be
paid as soon as practicable after audited financial statements for the year 1999
are available. Individuals, except retirees, may elect to defer their awards
into the 401(k) plan established by American.
General
Neither this Plan nor any action taken thereunder shall be construed as giving
to any employee or participant the right to be retained in the employ of
American or any Affiliate.
Nothing in the Plan shall be deemed to give any employee any right,
contractually or otherwise, to participate in the Plan or in any benefits
thereunder, other than the right to receive payment of such award as may have
been expressly determined by the Committee.
4
In the event of any act of God, war, natural disaster, aircraft grounding,
revocation of operating certificate, terrorism, strike, lockout, labor dispute,
work stoppage, fire, epidemic or quarantine restriction, act of government,
critical materials shortage, or any other act beyond the control of the Company,
whether similar or dissimilar, (each a "Force Majeure Event"), which Force
Majeure Event affects the Company or its Subsidiaries or its Affiliates, the
Board of Directors of the Company, at its sole discretion, may (i) terminate or
(ii) suspend, delay, defer (for such period of time as the Board may deem
necessary), or substitute any payments due currently or in the future under the
Plan, including, but not limited to, any payments that have accrued to the
benefit of participants but have not yet been paid.
In consideration of the employee's privilege to participate in the Plan, the
employee agrees (i) not to disclose any trade secrets of, or other
confidential/restricted information of, American, to any unauthorized party and,
(ii) not to make any unauthorized use of such trade secrets or confidential or
restricted information during his or her employment with American or after such
employment is terminated, and (iii) not to solicit any current employees of
American or any subsidiaries of AMR Corporation to join the employee at his or
her new place of employment after his or her employment with American is
terminated.
The Committee may amend, suspend, or terminate the Plan at any time.
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