Delta Airlines 2002 Annual Report Download - page 74

ARTICLE 6
CERTAIN TAX PAYMENTS
Section 6.01. Gross-Up Payment. In the event Executive becomes entitled
to benefits under Section 4.01 or Article 5 hereof, the Company shall pay to
Executive an additional lump sum payment (the "Gross-Up Payment"), in cash,
equal to the sum of the amounts, if any, described in paragraphs (a) and (b)
below:
(a) Executive shall be entitled under this paragraph to the sum of (i) the
present value of all of Executive's applicable federal, state and local taxes
arising due to payments or coverage provided under Section 4.01(d) or 4.01(e),
to the extent such payments or coverage are provided in respect of benefits or
coverage which, if provided to Executive while employed by the Company, would
not have been taxable to Executive, and (ii) an additional amount such that
after payment by Executive of all of Executive's applicable federal, state and
local taxes on such additional amount, Executive will retain an amount
sufficient to pay the total of Executive's applicable federal, state and local
taxes arising due to the payment required pursuant to clause (i) above. For
purposes of clause (i) above, present value shall be determined using the
appropriate "applicable federal rate" promulgated by the Treasury Department
under Code Section 1274(d) for the month in which the Gross-Up Payment is made,
assuming that all taxes will be paid on the due date therefore (without regard
to extensions).
(b) If any portion of the Severance Benefits or any other payment under
this Agreement, or under any other agreement with or plan of the Company,
including but not limited to stock options and other long-term incentives (in
the aggregate "Total Payments") would be subject to the excise tax imposed by
Section 4999 of the Code or any interest or penalties with respect to such
excise tax (such excise tax, together with any such interest and penalties, are
hereinafter collectively referred to as the "Excise Tax"), then Executive shall
be entitled under this paragraph to an additional amount such that after payment
by Executive of all of Executive's applicable federal, state and local taxes,
including any Excise Tax, imposed upon such additional amount, Executive will
retain an amount sufficient to pay the Excise Tax imposed on the Total Payments.
The amounts payable under this Section 6.01 shall be paid by the Company
as soon as practicable (but in no event more than 30 days) after the occurrence
of the events giving rise to Executive's right to benefits under Section 4.01 or
Article 5.
Section 6.02. Determinations. In the event of a Change in Control, all
determinations required to be made under this Article 6, including the amount of
the Gross-Up Payment, whether a payment is required under Paragraph (b) of
Section 6.01, and the assumptions to be used in determining the Gross-Up
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