Delta Airlines 2007 Annual Report Download - page 100

Table of Contents
Index to Financial Statements
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Our aircraft order commitments as of December 31, 2007 consist of firm orders to purchase eight B-777-200LR aircraft, 10 B-737-700 aircraft, 40
B-737-800 aircraft and 18 CRJ-900 aircraft as discussed below. Our firm orders to purchase 40 B-737-800 aircraft include 38 B-737-800 aircraft, which we
have entered into definitive agreements to sell to third parties immediately following delivery of these aircraft to us by the manufacturer. These sales will
reduce our future commitments by approximately $1.6 billion during the period from 2008 through 2010.
During 2007, we entered into agreements with Bombardier Inc. ("Bombardier") to purchase 44 CRJ-900 aircraft for delivery between August 2007 and
February 2010. These aircraft will be delivered in two-class, 76 seat configuration. We have available to us long-term, secured financing commitments to fund
a substantial portion of the aircraft purchase price for these orders. We expect these CRJ-900 aircraft will be operated by regional air carriers under our
contract carrier agreements. Our agreements with Bombardier permit us to assign to other carriers our CRJ-900 aircraft orders and related support provisions.
In April 2007, we assigned to a regional air carrier our orders to purchase 16 CRJ-900 aircraft. The remaining CRJ-900 aircraft are scheduled for delivery
between August 2007 and May 2009. As of December 31, 2007, we had accepted delivery of 10 aircraft.
The above table does not include any commitments by us for the CRJ-900 Assigned Aircraft because the regional air carrier is required to purchase and
make the related payments for those aircraft. While we would be required to purchase the CRJ-900 Assigned Aircraft in the event of a default by the regional
air carrier of its purchase obligation, we currently believe such an event is not likely.
At December 31, 2007, we had (1) agreements to lease an additional three B-757-200ER aircraft and (2) a letter of intent to lease one additional
B-757-200ER aircraft, which we entered into a final agreement in January 2008. We accepted delivery of two aircraft in January 2008, and expect to receive
the remaining two aircraft in the March 2008 quarter.
Contract Carrier Agreements
Delta Connection Carriers
As of December 31, 2007, we had contract carrier agreements with 10 regional air carriers, including our wholly owned subsidiary, Comair. As
discussed below, one carrier ceased operations in January 2008.
Capacity Purchase Agreements. During the eight months ended December 31, 2007 and the four months ended April 30, 2007, seven regional air
carriers operated for us (in addition to Comair) pursuant to capacity purchase agreements. Under these agreements, the regional air carriers operate some or all
of their aircraft using our flight code, and we schedule those aircraft, sell the seats on those flights and retain the related revenues. We pay those airlines an
amount, as defined in the applicable agreement, which is based on a determination of their cost of operating those flights and other factors intended to
approximate market rates for those services. We have entered into more than one capacity purchase agreement with three of these carriers. For the years
ending 2008, 2009, 2010, 2011, 2012 and thereafter, we have Contract Carrier obligations of $2.4 billion, $2.5 billion, $2.6 billion, $2.6 billion, $2.5 billion
and $14.0 billion, respectively. These amounts represent our minimum fixed obligation under our Contract Carrier agreements with Atlantic Southeast
Airlines, Inc. ("ASA"), Chautauqua, ExpressJet Airlines, Inc. ("ExpressJet"), Freedom, Pinnacle Airlines, Inc. ("Pinnacle"), Shuttle America, and SkyWest
Airlines, Inc. ("SkyWest Airlines") (excluding contract carrier lease payments accounted for as operating leases, which are described in Note 7).
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