Delta Airlines 2004 Annual Report Download - page 92

Table of Contents
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
proceedings because, for example, the litigation is in its early stages or the plaintiff does not specify the damages being sought. Although the ultimate
outcome of these matters cannot be predicted with certainty and could have a material adverse effect on our Consolidated Financial Statements, management
believes that the resolution of these actions will not have a material adverse effect on our Consolidated Financial Statements.
Other Contingencies
Regional Airports Improvement Corporation ("RAIC")
We are obligated under a facilities sublease with the RAIC to pay the bond trustee rent in an amount sufficient to pay the debt service on $47 million in
Facilities Sublease Revenue Bonds. These bonds were issued in 1985 to finance the construction of certain airport and terminal facilities we lease at Los
Angeles International Airport. We also provide a guarantee to the bond trustee covering payment of the debt service.
General Indemnifications
We are the lessee under many real estate leases. It is common in these commercial lease transactions for us, as the lessee, to agree to indemnify the lessor
and other related third parties for tort, environmental and other liabilities that arise out of or relate to our use or occupancy of the leased premises. This type of
indemnity would typically make us responsible to indemnified parties for liabilities arising out of the conduct of, among others, contractors, licensees and
invitees at or in connection with the use or occupancy of the leased premises. This indemnity often extends to related liabilities arising from the negligence of
the indemnified parties, but usually excludes any liabilities caused by either their sole or gross negligence and their willful misconduct.
Our aircraft and other equipment lease and financing agreements typically contain provisions requiring us, as the lessee or obligor, to indemnify the other
parties to those agreements, including certain related parties, against virtually any liabilities that might arise from the condition, use or operation of the aircraft
or such other equipment.
We believe that our insurance would cover most of our exposure to such liabilities and related indemnities associated with the types of lease and financing
agreements described above, including real estate leases.
Certain of our aircraft and other financing transactions include provisions which require us to make payments to preserve an expected economic return to
the lenders if that economic return is diminished due to certain changes in law or regulations. In certain of these financing transactions, we also bear the risk
of certain changes in tax laws that would subject payments to non-U.S. lenders to withholding taxes.
We cannot reasonably estimate our potential future payments under the indemnities and related provisions described above because we cannot predict
when and under what circumstances these provisions may be triggered.
Employees Under Collective Bargaining Agreements
At December 31, 2004, we had a total of approximately 69,150 full-time equivalent employees. Approximately 18% of these employees, including all of
our pilots, are represented by labor unions.
ASA is in collective bargaining negotiations with the Air Line Pilots Association, International ("ALPA") and the Association of Flight Attendants
("AFA"), which represent ASA's approximately 1,515 pilots and 885 flight attendants, respectively. ASA's collective bargaining agreements with ALPA and
AFA became amendable in September 2002 and September 2003, respectively.
Comair is in collective bargaining negotiations with the International Association of Machinists and Aerospace Workers, which represents Comair's
approximately 485 maintenance employees. The maintenance employees rejected a tentative agreement to amend their existing agreement that became
amendable in May 2004, which Comair had reached with the union's negotiating committee, but Comair expects negotiations to continue. In addition, Comair
is negotiating with the International Brotherhood of Teamsters, which represents
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