Delta Airlines 2007 Annual Report Download - page 110

Table of Contents
Index to Financial Statements
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Disability and Survivorship Plans. We amended the disability and survivorship plan for pilots ("Pilot D&S Plan") to replace survivor benefits and basic
life insurance coverage with limited term life insurance for pilots who retire on or after January 1, 2008. This amendment reduced the APBO for the Pilot
D&S Plan by $65 million. We had previously amended the disability and survivorship plan for non-pilots to provide that survivor benefits will not be paid for
such employees who either die while in active employment after July 1, 2010 or retire after such date.
Western Pilot Plan. We agreed to terminate in a standard termination the Western Airlines, Inc. Pilots Defined Benefit Pension Plan, which is a separate
frozen qualified defined benefit plan for certain pilots formerly employed by Western Airlines.
During 2007, in connection with our bankruptcy proceedings, we restructured our retiree benefit programs as follows:
Non-Pilot Pension Plans. Effective April 1, 2007, we elected the alternative funding schedule under Section 402(a)(1) of the Pension Protection Act of
2006 with respect to the Non-Pilot Plan. We also rejected in bankruptcy our non-qualified pension plans for non-pilot employees. As a result, no further
benefits will be paid from these non-qualified plans.
Claims associated with changes made in the Chapter 11 reorganization and obligations related to our defined benefit plans, other postretirement benefit
plans, and certain postemployment benefits were classified as liabilities subject to compromise as of December 31, 2006, as these obligations were impacted
by our Chapter 11 proceedings. For additional information, see "Liabilities Subject to Compromise" in Note 1.
Defined Benefit Pension and Other Postretirement and Postemployment Benefit Plans
Defined Benefit Pension Plan. We sponsor the Non-Pilot Plan, which provides a retirement benefit based on a combination of a final average earnings
formula and a cash balance formula, subject to the terms of that plan. Effective December 31, 2005, future pay and service accruals under the Non-Pilot Plan
were frozen. We estimate that the funding requirements under our Non-Pilot Plan will be approximately $100 million in 2008.
Postretirement Healthcare Plans. We sponsor healthcare plans that provide benefits to substantially all Delta retirees and their eligible dependents who
are under age 65. Benefits under these plans are funded from our current assets and are subject to co-payments, deductibles and other limits as described in the
plans. As explained above, (1) non-pilot employees are not eligible for company provided post-retirement healthcare coverage after age 65, except for a
limited subsidy for certain retirees, and (2) pilots who retire after June 1, 2006 are not eligible for subsidized post-age 65 healthcare coverage although they
may purchase such coverage at full cost and certain pilots who retired on or before June 1, 2006 are eligible for a limited subsidy.
Postemployment Plans. We provide certain other welfare benefits to eligible former or inactive employees after employment, but before retirement,
primarily as part of the disability and survivorship plans. These disability and survivorship plans provide benefits to substantially all Delta employees as a
result of a participant's death or disability. As discussed above, survivor benefits have been replaced with limited term life insurance coverage for pilots
retiring on or after January 1, 2008. Additionally, survivor benefits will not be paid for non-pilot employees who either die while in active employment after
July 1, 2010 or retire after such date.
SFAS 158. On December 31, 2006, we adopted the recognition and disclosure provisions of SFAS No. 158 "Employers Accounting for Defined Benefit
Pension and Other Postretirement Plans, an amendment of SFAS Nos. 87, 88, 106, 132(R)" ("SFAS 158"). SFAS 158 required that we recognize the funded
status of our defined
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