Earnings (Loss) Per Share

9 Months Ended

Sep. 30, 2021

EARNINGS (LOSS) PER SHARE

The computations of UAL's basic and diluted earnings (loss) per share are set forth below (in millions, except per share amounts):


	Three Months Ended September 30,				Nine Months Ended September 30,
	2021		2020		2021		2020

Earnings (loss) available to common stockholders	$	473	$	(1,841)	$	(1,318)	$	(5,172)

Basic weighted-average shares outstanding	323.7		291.0		321.3		273.5
Dilutive effect of employee stock awards	3.0		—		—		—
Dilutive effect of stock warrants	2.3		—		—		—
Diluted weighted-average shares outstanding	329.0		291.0		321.3		273.5

Earnings (loss) per share, basic	$	1.46	$	(6.33)	$	(4.10)	$	(18.91)
Earnings (loss) per share, diluted	$	1.44	$	(6.33)	$	(4.10)	$	(18.91)

During the first quarter of 2021, UAL entered into a warrant agreement with Treasury pursuant to which UAL issued to Treasury warrants to purchase up to approximately 2.0 million shares of UAL common stock (the "PSP2 Warrants"). The relative fair value of the PSP2 Warrants was calculated using a Black-Scholes options pricing model, and approximately $56 million was recorded within stockholders' equity with an offset to the CARES Act grant credit. During the second quarter of 2021, UAL entered into an additional warrant agreement with Treasury, pursuant to which UAL issued to Treasury warrants to purchase up to approximately 1.5 million shares of UAL common stock (the "PSP3 Warrants"). The relative fair value of the PSP3 Warrants was calculated using a Black-Scholes options pricing model, and approximately $43 million was recorded within stockholders' equity with an offset to the CARES Act grant credit. The PSP2 Warrants and PSP3 Warrants are exercisable either through net share settlement in cash or in shares of UAL common stock, at UAL's option. The PSP2 Warrants and PSP3 Warrants contain customary anti-dilution provisions and registration rights and are freely transferable. Pursuant to the terms of the PSP2 Warrants and PSP3 Warrants, warrant holders do not have any voting rights. As of September 30, 2021, the Company had the following warrants outstanding:


Warrant Description		Number of Shares of UAL Common Stock (in millions)	Exercise Price		Expiration Dates
PSP1 Warrants (a)		4.8	$	31.50	4/20/2025	—	9/30/2025
CARES Act Loan Warrants		1.7	31.50		9/28/2025
PSP2 Warrants		2.0	43.26		1/15/2026	—	4/29/2026
PSP3 Warrants		1.5	53.92		4/29/2026	—	6/10/2026
Total		10.0

(a)	Warrants issued in connection with the $1.5 billion 10-year senior unsecured promissory note with Treasury provided under the Payroll Support Program of the CARES Act ("PSP1").

On June 15, 2020, UAL entered into an equity distribution agreement relating to the issuance and sale from time to time by UAL (the "2020 ATM Offering"), of up to 28 million shares of UAL common stock. In the first quarter of 2021, the Company sold approximately 7 million shares at an average price of $42.98 per share, with net proceeds to the Company of approximately $282 million. With these sales, the Company sold all of the shares authorized under the 2020 ATM Offering.

On March 3, 2021, the Company entered into an equity distribution agreement (the "Distribution Agreement") with several financial institutions (collectively, the "Managers"), relating to the issuance and sale from time to time by UAL (the "2021 ATM Offering"), through the Managers, of up to 37 million shares of UAL common stock (the "2021 ATM Shares"). Sales of the 2021 ATM Shares under the Distribution Agreement may be made in any transactions that are deemed to be "at the market offerings" as defined in Rule 415 under the Securities Act of 1933, as amended. Under the terms of the Distribution Agreement, UAL may also sell the 2021 ATM Shares to any Manager, as principal for its own account, at a price agreed upon at the time of sale. If UAL sells the 2021 ATM Shares to a Manager as principal, UAL will enter into a separate terms agreement with such

Manager. During the nine months ended September 30, 2021, approximately 4 million shares were sold in the 2021 ATM Offering at an average price of $57.50 per share, with net proceeds to the Company totaling approximately $250 million.