United Airlines 2007 Annual Report Download - page 22

Any inability to retain or attract significant numbers of qualified management and other personnel could adversely affect its business.
The Company could be adversely affected by an outbreak of a disease that affects travel behavior.
An outbreak of a disease that affects travel demand or travel behavior, such as Severe Acute Respiratory Syndrome ("SARS") or avian flu, or other illness,
could have a material adverse impact on the Company's business, financial condition and results of operations.
Certain provisions of UAL's Governance Documents could discourage or delay changes of control or changes to the Board of Directors of UAL.
Certain provisions of the amended and restated certificate of incorporation and amended and restated bylaws of UAL (the "Governance Documents") may
make it difficult for stockholders to change the composition of UAL's Board of Directors and may discourage takeover attempts that some of its stockholders
may consider beneficial.
Certain provisions of the Governance Documents may have the effect of delaying or preventing changes in control if UAL's Board of Directors determines
that such changes in control are not in the best interests of UAL and its stockholders.
These provisions of the Governance Documents are not intended to prevent a takeover, but are intended to protect and maximize the value of UAL's
stockholders' interests. While these provisions have the effect of encouraging persons seeking to acquire control of UAL to negotiate with the UAL Board of
Directors, they could enable the Board of Directors to prevent a transaction that some, or a majority, of its stockholders might believe to be in their best interests
and, in that case, may prevent or discourage attempts to remove and replace incumbent directors.
The issuance of UAL's contingent senior unsecured notes could adversely impact results of operations, liquidity and financial position and could cause
dilution to the interests of its existing stockholders.
In connection with the Company's emergence from Chapter 11 bankruptcy protection, UAL is obligated under an indenture to issue to the PBGC 8% senior
unsecured notes with an aggregate principal amount of up to $500 million in up to eight equal tranches of $62.5 million (with no more than one tranche issued as
a result of each issuance trigger event) upon the occurrence of certain financial triggering events. An issuance trigger event occurs when the Company's
EBITDAR (as defined in the indenture) exceeds $3.5 billion over the prior twelve months ending June 30 or December 31 of any applicable fiscal year,
beginning with the fiscal year ending December 31, 2009 and ending with the fiscal year ending December 31, 2017. However, if the issuance of a tranche would
cause a default under any other securities then existing, UAL may satisfy its obligations with respect to such tranche by issuing UAL common stock having a
market value equal to $62.5 million. The issuance of these notes could adversely impact the Company's results of operations because of increased interest
expense related to the notes and adversely impact its financial position or liquidity due to increased cash required to meet interest and principal payments. If
common stock is issued in lieu of debt, this could cause additional dilution to existing UAL stockholders. See Risks Related to UAL's Common Stock, below, for
additional information regarding other risks related to our common stock.
Risks Related to UAL's Common Stock
UAL's common stock has a limited trading history and its market price may be volatile.
Because UAL's common stock began trading on the NASDAQ National Market on February 2, 2006, there is limited trading history. The market price of its
common stock may fluctuate substantially due to a variety of factors, many of which are beyond UAL's control.
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Source: UNITED AIR LINES INC, 10-K, February 29, 2008