Torbjorn Enqvist

About Torbjorn Enqvist

Executive Vice President and Chief Operations Officer of United Airlines Holdings, Inc. (UAL) since July 2022; age 53. Previously Chief Customer Officer (2021–2022) and multiple senior operations and customer roles since 2010; joined Continental Airlines in 1996 . Company performance during 2024 included pre-tax margin of 7.3% (8.1% adjusted), diluted EPS $9.45 ($10.61 adjusted), operating cash flow $9.4B and free cash flow $3.4B, with total operating revenue of $57.1B (+6.2% YoY), informing high incentive payouts across the executive team . UAL’s 2024 Short-Term Incentive (STI) paid at 175% of target based on financial, customer and operational goals, reinforcing pay-for-performance alignment for NEOs including Enqvist .

Past Roles

External Roles

• Not disclosed in company filings reviewed.

Fixed Compensation

Notes:

• 2024 STI program paid at 175% of target for NEOs based on performance certification .
• 2024 base salary rate increases effective April 1, 2024 .

Performance Compensation

Annual STI design and outcomes (2024)

• Payout curve: 50% entry, 100% target, 200% max .

Long-Term Incentive (LTI) program – Awards impacting Enqvist

Additional notes:

• 2024 “stretch” (max) valuation disclosure shows Enqvist 2024 PBRSUs max value $2,428,204 and Retention LTI max value $4,654,994 (for disclosure sensitivity) .
• 2023 STI context: Company achieved a formulaic payout of 139% with relative adjusted EBITDA margin exceeding stretch by 2.7 points and positive reliability metrics exceeding target .

Equity outstanding/vesting (as of 12/31/24)

Vesting structures: time-based RSUs vest ratably over three years; annual PBRSUs vest on a 3-year cliff; Retention LTI PBRSUs vest in thirds tied to specific fiscal measurement windows (Jun 30, 2025/2026/2027) .

Equity Ownership & Alignment

• Beneficial ownership: 82,358 shares; <1% of outstanding UAL shares .
• Executive stock ownership guidelines: Enqvist must hold 3x base salary; executives must retain 50% of net shares until compliant; all NEOs compliant in latest review .
• Hedging & pledging: Prohibited for officers/directors; no short sales, options, collars, or pledging permitted under policy .

Employment Terms

• Severance (Executive Severance Plan): Upon involuntary termination without cause or resignation for good reason, cash severance equals 2x (base salary + target annual bonus), plus 24 months of welfare benefits at employee rates, outplacement (12 months), and lifetime flight benefits (annual cap; no tax gross-up) .
• Change-in-control: Double trigger. No payments/benefits unless qualifying termination occurs within two years post-CIC; time-based RSUs vest in full at termination; PBRSUs measured at target on CIC with settlement at end of performance period or on qualifying termination .
• Early retirement eligibility: Enqvist was eligible for early retirement as of Dec 31, 2024, which enables pro-rata treatment for certain awards if conditions met; CARP distributions available by annuity or lump sum if eligible at termination (lump sum not available if not retirement-eligible) .
• Quantified 12/31/24 separation values (illustrative): Cash severance $3,960,000; equity acceleration $7,725,469 (retirement/resignation), $11,912,712 (death/disability), $23,010,273 (CIC with qualifying termination); transformation cash $950,000 (retirement/death/disability) or $1,875,000 (CIC); continuation coverage $50,400; life insurance $2,640,000; outplacement $25,000; flight benefits $66,378 .
• Pension: Frozen Continental Airlines Retirement Plan (CARP) PVAB $251,555; 17.4 years of credited service through Dec 31, 2013 .
• Clawback: Mandatory Dodd-Frank/Nasdaq restatement recoupment for Section 16 officers and discretionary 3-year lookback for significant legal/compliance violations for officers VP+ .

Multi-Year Compensation Snapshot (NEO table excerpts)

Note: 2024 STI payout determined at 175% of target overall .

Compensation Structure Analysis

• Increased at-risk pay weight: 2024 PBRSUs shifted to 80% financial metrics (Adjusted EPS and Relative Adjusted Pre-tax Margin), with strategic goals at 20% and a TSR modifier on 2024 PBRSUs, enhancing alignment with shareholder value creation .
• Special retention PBRSUs (Jul 2024): Granted to address sector retention risk and tie outcomes to earnings and margins across 2025–2027 windows; vesting in thirds with performance gates .
• No hedging/pledging; robust clawback; standardized severance; double-trigger CIC; no excise tax gross-ups; features generally shareholder-friendly .
• Say-on-Pay support averaged 92% over last three years, indicating broad investor endorsement of compensation design .

Risk Indicators & Red Flags

• Pledging/hedging: Prohibited under policy (mitigates alignment risk) .
• Option repricing: Not permitted without shareholder approval under LTI plan .
• Clawback: Strong mandatory and discretionary scope (recoupment risk mitigant) .
• Retirement eligibility: Enqvist’s retirement eligibility can reduce forfeiture risk and may facilitate pro-rata vesting, slightly lowering retention friction relative to non-eligible executives .

Investment Implications

• Pay-for-performance alignment is strong: 2024 STI paid 175% amid robust financial and operational delivery; LTI now 80% earnings/margin with a TSR lever, increasing sensitivity to shareholder value creation .
• Retention dynamics: Special PBRSU retention award through 2027 plus outstanding PBRSUs/RSUs create continued vesting and performance milestones that can curb near-term selling pressure; retirement eligibility introduces some flexibility in separations but also reduces forfeiture risk .
• Downside protections and governance: Double-trigger CIC, standardized severance (2x salary+bonus), robust clawback, and anti-hedging/pledging collectively balance incentives with governance discipline, limiting shareholder-unfriendly outcomes .
• Skin-in-the-game: Beneficial ownership of 82,358 shares plus sizable unvested equity and 3x salary ownership guideline drive alignment; NEOs are reported in compliance .