Appendix D

Distribution Agreement

LETTER OF AGREEMENT

between

UNITED AIR LINES, INC.

and

THE FLIGHT ATTENDANTS

in the service of

UNITED AIR LINES, INC.

as represented by

ASSOCIATION OF FLIGHT ATTENDANTS - CWA, AFL-CIO

THIS LETTER OF AGREEMENT is made and entered into in accordance with the Railway Labor Act by and between UNITED AIR LINES, INC. (hereinafter referred to as the “Company”) and the ASSOCIATION OF FLIGHT ATTENDANTS – CWA (hereinafter referred to as “AFA” or the “Association”).

WHEREAS UAL, the Company, and the AFA-CWA have reached agreement concerning the revisions to the 2003 – 2009 Flight Attendant Agreement necessary for the Company to emerge from Chapter 11; and

WHEREAS the AFA-CWA has agreed to modifications to the Letter of Agreement on pages 266 –268 of the 2003 – 2009 Flight Attendant Agreement;

THEREFORE the parties to this Letter of Agreement hereby agree to the following:

1. Section 2 of the Distribution Agreement to the 2003 – 2009 Flight Attendant Agreement (the “Distribution Agreement”) is hereby amended to read in its entirety as follows:
   
   

   In consideration for the Flight Attendant contract revisions under the Section 1113(c) Restructuring Agreement reached between UAL, the Company, and AFA-CWA effective May 1, 2003 (the “2003 Restructuring Agreement”), which modifies the parties’ 1996 collective bargaining agreement (“1996 Agreement”), and in consideration of the Flight Attendant contract revisions under the revisions to the 2003 Flight Attendant Agreement effective in 2005 (the “2005 – 2010 Flight Attendant Agreement”), any plan of reorganization proposed or supported by UAL and the Company as proposed and/or amended from time to time (the “Plan”), shall provide that, on or as soon as reasonably practicable after the effective date of such Plan, the Flight Attendant group will receive a percentage distribution of the equity, securities and/or other consideration provided to general unsecured creditors under the Plan (the “Distribution”) calculated by the following formula:

   A/(A+B), where:

   A is the sum of (i) $775,995,145, representing the dollar value of 30 months of average cost reductions under the 2003 Restructuring Agreement as reasonably measured under Labor Model 1.1A FINAL, and (ii) $216,667,000 – representing the dollar value of 20 months of average cost reductions under the 2005 – 2010 Flight Attendant Agreement as reasonably measured by the Final 2004 Labor Model (the “AFA Amount”); and

   B is the total amount of all other allowed prepetition general unsecured claims against the Debtors (UAL and its 27 debtor subsidiaries).
   

2. Section 3 of the Distribution Agreement is hereby amended to read in its entirety as follows:
   
   

   In the event the other employees of the Company receive a Distribution in excess of 20 months of average cost reductions (as measured by the Final 2004 Labor Model) in connection with the 2005 labor cost reductions (the "Other Employee Distribution"), the $216,667,000 amount described in paragraph 2 of this Distribution Agreement shall instead equal the product of (x) $216,667,000 and (y) a fraction, the numerator of which is the actual amount of the Other Employee Distribution, and the denominator of which is 20 months of average cost reductions (as measured by the Final 2004 Labor Model) for all other employees.
   

3. Section 5 of the Distribution Agreement is hereby amended to read in its entirety as follows:

   Following approval of the Distribution Agreement, and prior to the effective date of the Plan, AFA (in consultation with the Company) will develop a reasonable method for allocating the Distribution or Alternative Distribution as applicable (which allocation will distribute all of the Distribution or Alternative Distribution to the AFA members). The Company (in consultation with AFA) will develop and implement a mechanism and timetable for issuing the Distribution or Alternative Distribution to the AFA members, which would take into account tax, legal, corporate liquidity and securities concerns as well as practical considerations.
   

4. Except as revised in the preceding paragraphs, the Distribution Agreement shall remain unchanged and in full force and effect.

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