Delta Airlines 2007 Annual Report Download - page 46

Table of Contents
Index to Financial Statements
Defined Benefit Pension Plans ("DB Plans"). During 2007, we contributed approximately $116 million to our DB Plans. Under our settlement
agreement with the PBGC, the Pilot Plan was terminated effective September 2, 2006. In addition, our non-qualified defined benefit pension plans for pilots
were terminated effective September 2, 2006.
Effective December 31, 2005, future pay and service accruals under the Non-Pilot Plan were frozen. 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 defined benefit plans for non-pilot employees. As a result, no further benefits will be paid from these non-qualified plans. The Pension Protection
Act of 2006 allows us to reduce the funding obligations for the Non-Pilot Plan over the next several years. While this legislation makes our funding
obligations for the Non-Pilot Plan more predictable, factors outside our control will continue to have an impact on the funding requirements for that plan.
Estimates of future funding requirements for the Non-Pilot Plan are based on various assumptions, including, among other things, the actual and
projected market performance of assets of the Non-Pilot Plan; statutory requirements; the terms of the Non-Pilot Plan; and demographic data for participants
in the Non-Pilot Plan, including the number of participants and the rate of participant attrition.
Assuming current funding rules, we estimate that the funding requirements under the Non-Pilot Plan for 2008 to 2012 will aggregate approximately
$500 million.
Contract Carrier Agreements. We have long-term capacity purchase agreements with several regional air carriers. Under these agreements, the 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 revenue. 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.
Under these long-term capacity purchase agreements, we are obligated to pay certain minimum fixed obligations, which are included in the table above.
The remaining estimated expense is not included in the table because this expense is contingent based on the costs associated with the operation of contract
carrier flights by those air carriers as well as rates that are unknown at this time. We cannot reasonably estimate at this time our expense under the contract
carrier agreements in 2008 and thereafter.
For information regarding payments we may be required to make in connection with certain terminations of our capacity purchase agreements with
Chautauqua and Shuttle America, see "Contingencies Related to Termination of Contract Carrier Agreements" in Note 8 of the Notes to the Consolidated
Financial Statements.
FIN 48. We adopted FIN 48 on January 1, 2007. The total amount of unrecognized tax benefits on the Consolidated Balance Sheet at December 31,
2007 is $143 million. We have accrued $54 million for the payment of interest and $8 million for the payment of penalties related to these unrecognized tax
benefits.
We are currently under audit by the Internal Revenue Service for the 2005 and 2006 tax years.
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