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DELTA AIR LINES INC /DE/ (DAL)
10-K
Annual report pursuant to section 13 and 15(d)
Filed on 02/16/2011
Filed Period 12/31/2010

Table of contents

  • Page 1
    DELTA AIR LINES INC /DE/ (DAL) 10-K Annual report pursuant to section 13 and 15(d) Filed on 02/16/2011 Filed Period 12/31/2010

  • Page 2
    ..., D.C. 20549 FORM 10-K þ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2010 or o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission File Number 001-5424 DELTA AIR LINES...

  • Page 3
    ... of Operations-2009 GAAP Compared to 2008 Combined Financial Condition and Liquidity Contractual Obligations Critical Accounting Policies and Estimates Supplemental information Glossary of Defined Terms ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK ITEM 8. FINANCIAL STATEMENTS...

  • Page 4
    ... ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES PART IV ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES...

  • Page 5
    ... Airline Industry" in "Item 1A. Risk Factors" of this Form 10-K. All forward-looking statements speak only as of the date made, and we undertake no obligation to publicly update or revise any forward-looking statements to reflect events or circumstances that may arise after the date of this report...

  • Page 6
    ...world. Our global route network gives us a presence in every major domestic and international market. Our route network is centered around the hub system we operate at airports in Amsterdam, Atlanta, Cincinnati, Detroit, Memphis, Minneapolis-St. Paul, New York-JFK, Paris-Charles de Gaulle, Salt Lake...

  • Page 7
    ...2 years. One goal of SkyTeam is to link the route networks of the member airlines, providing opportunities for increased connecting traffic while offering enhanced customer service through mutual codesharing arrangements, reciprocal frequent flyer and lounge programs and coordinated cargo operations...

  • Page 8
    ... global network, our cargo operations are able to connect all of the world's major freight gateways. We generate cargo revenues in domestic and international markets primarily through the use of cargo space on regularly scheduled passenger aircraft. We are a member of SkyTeam Cargo, a global airline...

  • Page 9
    ... in Atlanta, Cincinnati, Detroit, Memphis, Minneapolis-St. Paul, New York-JFK and Salt Lake City either directly at those airports or at the hubs of other airlines that are located in close proximity to our hubs. We also face competition in smaller to medium-sized markets from regional jet operators...

  • Page 10
    ... authority to operate domestic and international air transportation (including the carriage of passengers and cargo). Except for constraints imposed by regulations regarding "Essential Air Services," which are applicable to certain small communities, airlines may terminate service to a city without...

  • Page 11
    ... Newark in the New York City area. Our operations at these airports generally require the allocation of slots or analogous regulatory authorities. Similarly, our operations at Tokyo's Narita Airport, London's Gatwick and Heathrow airports and other international airports are regulated by local slot...

  • Page 12
    ... Air Fleet program (the "CRAF Program"), which permits the U.S. military to use the aircraft and crew resources of participating U.S. airlines during airlift emergencies, national emergencies or times of war. We have agreed to make available under the CRAF Program a portion of our international long...

  • Page 13
    ... Date on which Collective Bargaining Agreement Becomes Amendable Employee Group Union Delta Pilots Delta Flight Superintendents (Dispatchers) Comair Pilots Comair Maintenance Employees Comair Flight Attendants 10,900 350 1,100 350 700 ALPA PAFCA ALPA IAM IBT December 31, 2012 December 31, 2013...

  • Page 14
    ...below-wing airport customer service employees, cargo warehouse employees and related positions Includes technical operations supply attendants, stock clerks and stores utility employees Includes above-wing airport customer service agents, cargo sales agents and passenger reservations sales agents 10

  • Page 15
    ... well as flight dispatchers, meteorologists and aircraft maintenance technicians and related Technical Operations employees has been resolved. Executive Officers Richard H. Anderson, Age 55: Chief Executive Officer of Delta since September 1, 2007; Executive Vice President of UnitedHealth Group and...

  • Page 16
    ... Vice President-General Counsel of Northwest (1990-1994); Vice President-General Counsel and Secretary of Continental Airlines (1986-1990). Additional Information We make available free of charge on our website our Annual Report on Form 10-K, our Quarterly Reports on Form 10-Q, our Current Reports...

  • Page 17
    ... in fuel costs or disruptions in fuel supplies could have additional negative effects on us. Our funding obligations with respect to defined benefit pension plans we sponsor is significant and can vary materially because of changes in investment asset returns and values. The recent financial crisis...

  • Page 18
    ... the terms of their collective bargaining agreements, those carriers may be subject to work interruptions or stoppages, subject to the requirements of the Railway Labor Act, which could have a negative impact on our operations. Completion of the integration of the Delta and Northwest Airlines...

  • Page 19
    ...operations. Our business is heavily dependent on our operations at the Atlanta airport and at our other hub airports in Amsterdam, Cincinnati, Detroit, Memphis, Minneapolis-St. Paul, New York-JFK, Paris-Charles de Gaulle, Salt Lake City and Tokyo-Narita. Each of these hub operations includes flights...

  • Page 20
    .... We utilize the services of third party providers in a number of areas in support of our operations that are integral to our business, including third party carriers in the Delta Connection program. While we have agreements with these providers that define expected service performance, we do not...

  • Page 21
    ... in Atlanta, Cincinnati, Detroit, Memphis, Minneapolis-St. Paul, New York-JFK and Salt Lake City either directly at those airports or at the hubs of other airlines that are located in close proximity to our hubs. We also face competition in smaller to medium-sized markets from regional jet operators...

  • Page 22
    ... FAA's regulations. Other laws, regulations, taxes and airport rates and charges have also been imposed from time to time that significantly increase the cost of airline operations or reduce revenues. The industry is heavily taxed. For example, the Aviation and Transportation Security Act mandates...

  • Page 23
    ... amount of insurance coverage available to commercial air carriers for liability to persons (other than employees or passengers) for claims resulting from acts of terrorism, war or similar events and (2) increased the premiums for such coverage and for aviation insurance in general. Since September...

  • Page 24
    Table of Contents ITEM 2. PROPERTIES Flight Equipment Our operating fleet at December 31, 2010 is summarized in the following table: Current Fleet Aircraft Type Owned Capital Lease Operating Lease Total Average Age Passenger Aircraft: B-737-700 B-737-800 B-747-400 B-757-200 B-757-300 B-767-300 B-...

  • Page 25
    ... hotel and flight kitchen located near Tokyo's Narita International Airport. We lease ticket counter and other terminal space, operating areas and air cargo facilities in most of the airports that we serve. At most airports, we have entered into use agreements which provide for the non-exclusive use...

  • Page 26
    ... of Contents During the December 2010 quarter, we began a redevelopment project at JFK, where we currently operate primarily at Terminal 2 for domestic flights and Terminal 3 for international flights under leases with the Port Authority of New York and New Jersey ("Port Authority"). We estimate...

  • Page 27
    ...OF EQUITY SECURITIES Market Information Our common stock is listed on the New York Stock Exchange. The following table sets forth for the periods indicated the highest and lowest sales price for our common stock as reported on the NYSE. Common Stock High Low Fiscal 2009 First Quarter Second Quarter...

  • Page 28
    ...Holdings plc, SkyWest, Inc., Southwest Airlines Company, TAM S.A. ADS, United Continental Holdings, Inc., and US Airways Group, Inc. Issuer Purchases of Equity Securities We withheld the following shares of common stock to satisfy tax withholding obligations during the December 2010 quarter from the...

  • Page 29
    ...share data) Year Ended December 31, 2010(1) 2009(2) 2008(3) Operating revenue Operating expense Operating income (loss) Interest expense, net Miscellaneous, net Income (loss) before reorganization items, net Reorganization items, net Income (loss) before income taxes Income tax (provision) benefit...

  • Page 30
    ... purchase agreements; full-time equivalent employees excludes employees of contract carriers we do not own. Successor December 31, 2009 2008 Predecessor December 31, 2006 (in millions) 2010 2007 Total assets Long-term debt and capital leases (including current maturities) Stockholders' equity...

  • Page 31
    ... Contents ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS General Information We provide scheduled air transportation for passengers and cargo throughout the United States ("U.S.") and around the world. On October 29, 2008 (the "Closing Date"), a wholly...

  • Page 32
    ... in revenue. Profit sharing. We recorded $313 million related to our broad-based employee profit sharing plans for 2010. We did not record any profit sharing expense in 2009. Our broad-based profit sharing plans provide that, for each year in which we have an annual pre-tax profit (as defined in...

  • Page 33
    ... 2009. This change is attributable to the following: (Unfavorable) Favorable vs. Year Ended December 31, 2009 (in millions) Loss on extinguishment of debt Net interest expense Mark-to-market adjustments on the ineffective portion of fuel hedge contracts Foreign currency exchange rates Amortization...

  • Page 34
    ...2008 Northwest January 1 to October 29 Combined Year Ended December 31 2009 GAAP vs. 2008 Combined % Increase Increase (Decrease) (Decrease) (in millions) Passenger: Domestic Atlantic Pacific Latin America Total Mainline Regional carriers Total passenger revenue Cargo Other Total operating revenue...

  • Page 35
    ... and related costs increased $289 million due to (1) pay increases for pilot and non-pilot frontline employees, (2) higher pension expense from a decline in the value of our defined benefit plan assets as a result of market conditions and (3) Delta airline tickets awarded to employees as part...

  • Page 36
    ... (Unfavorable) 2009 GAAP vs. 2008 Combined (in millions) Miscellaneous, net Impairment in 2008 of minority ownership interest Foreign currency exchange rates Mark-to-market adjustments on the ineffective portion of fuel hedge contracts Loss on investments in 2008 Other Total miscellaneous, net 32...

  • Page 37
    ... Airport ("JFK") is one of the world's busiest airports in one of the most competitive airline markets. We currently operate primarily at Terminal 2 for domestic flights and Terminal 3, which was constructed in 1960, for international flights under leases with the Port Authority of New York and New...

  • Page 38
    ...American Express. The 2010 modification changed the SkyMiles Usage Period to a three-year period beginning in December 2011 from a two-year period beginning in December 2010. Pension Obligations. We sponsor a defined benefit pension plan for eligible non-pilot pre-Merger Delta employees and retirees...

  • Page 39
    ...in advance ticket sales due to the slowing economy and (5) the payment of $158 million in 2008 under our broad-based employee profit sharing plan related to 2007. Cash used in operating activities was partially offset by cash flows driven by a $3.5 billion increase in operating revenue, $2.0 billion...

  • Page 40
    ... agreements with these airlines are included in contract carrier obligations below. 2011 2012 2013 Contractual Obligations by Year 2014 2015 Thereafter Total (in millions) Long-term debt Principal amount Interest payments Contract carrier obligations Operating lease payments Employee benefit...

  • Page 41
    ... such as credit card companies, hotels and car rental agencies. We also sell mileage credits to non-airline businesses, customers and other airlines. Mileage credits can be redeemed for air travel on Delta and participating airlines, membership in our Sky Club and other program awards. We use the...

  • Page 42
    ... in our market capitalization, (2) an increase in fuel prices, (3) declining passenger mile yields, (4) lower passenger demand as a result of the weakened U.S. and global economy, (5) interruption to our operations due to an employee strike, terrorist attack, or other reasons, (6) changes to the...

  • Page 43
    ...for sale. To determine whether impairments exist for aircraft used in operations, we group assets at the fleet-type level (the lowest level for which there are identifiable cash flows) and then estimate future cash flows based on projections of capacity, passenger mile yield, fuel costs, labor costs...

  • Page 44
    ...and projected market performance of assets; statutory requirements; and demographic data for participants. For additional information about our defined benefit pension plans, see Note 10 of the Notes to the Consolidated Financial Statements. Recent Accounting Standards In October 2009, the Financial...

  • Page 45
    ... our recurring operational performance. Year Ended December 31, (in millions) 2010 2009 Operating income (loss) Item excluded: Restructuring and merger-related items Operating income excluding special items $ $ 2,217 450 2,667 $ $ (324) 407 83 Glossary of Defined Terms ASM-Available Seat Mile...

  • Page 46
    ...2011, our open fuel hedge position is as follows: Contract Fair Value at January 31, 2011 Based Upon $92 per Barrel of Crude Oil (in millions, unless otherwise stated) Weighted Average Contract Strike Price per Gallon Percentage of Projected Fuel Requirements Hedged Year ending December 31, 2011...

  • Page 47
    ... currency-denominated operating revenue and expense. Our largest exposures come from the Japanese yen and Canadian dollar. To manage exchange rate risk, we attempt to execute both our international revenue and expense transactions in the same foreign currency to the extent practicable. Changes in...

  • Page 48
    ...31, 2010 and 2009 Consolidated Statements of Operations for the years ended December 31, 2010, 2009 and 2008 Consolidated Statements of Cash Flows for the years ended December 31, 2010, 2009 and 2008 Consolidated Statements of Stockholders' Equity for the years ended December 31, 2010, 2009 and 2008...

  • Page 49
    ... of Delta Air Lines, Inc. (the Company) as of December 31, 2010 and 2009, and the related consolidated statements of operations, stockholders' equity, and cash flows for the years ended December 31, 2010, 2009 and 2008. These financial statements are the responsibility of the Company's management...

  • Page 50
    ...: Current maturities of long-term debt and capital leases Air traffic liability Accounts payable Frequent flyer deferred revenue Accrued salaries and related benefits Taxes payable Other accrued liabilities Total current liabilities Noncurrent Liabilities: Long-term debt and capital leases Pension...

  • Page 51
    ...in millions, except per share data) 2010 Year Ended December 31, 2009 2008 Operating Revenue: Passenger: Mainline Regional carriers Total passenger revenue Cargo Other Total operating revenue Operating Expense: Aircraft fuel and related taxes Salaries and related costs Contract carrier arrangements...

  • Page 52
    ... the Merger Proceeds from sales of flight equipment Other, net Net cash (used in) provided by investing activities Cash Flows From Financing Activities: Payments on long-term debt and capital lease obligations Proceeds from long-term obligations Proceeds from American Express Agreement Payment of...

  • Page 53
    ... equity awards (Treasury shares withheld for payment of taxes, $6.77 per share)(1) Stock options exercised Balance at December 31, 2009 Comprehensive income: Net income Other comprehensive loss Total comprehensive income Shares of common stock issued pursuant to Delta's Plan of Reorganization Shares...

  • Page 54
    ... ACCOUNTING POLICIES Background Delta Air Lines, Inc., a Delaware corporation, provides scheduled air transportation for passengers and cargo throughout the United States ("U.S.") and around the world. On October 29, 2008 (the "Closing Date"), a wholly-owned subsidiary of Delta merged (the "Merger...

  • Page 55
    ...Bad debt expense and write-offs were not material for the years ended December 31, 2010, 2009 and 2008. Derivative Financial Instruments Our results of operations are significantly impacted by changes in aircraft fuel prices, interest rates and foreign currency exchange rates. In an effort to manage...

  • Page 56
    ... in jet fuel prices Entire amount of change in fair value of hedge is recorded in aircraft fuel expense and related taxes (2) In the Merger, we assumed Northwest's outstanding hedge contracts, which included fuel, interest rate and foreign currency cash flow hedges. On the Closing Date, we...

  • Page 57
    ...and car rental agencies. We also sell mileage credits to non-airline businesses, customers and other airlines. Mileage credits can be redeemed for air travel on Delta and participating airlines, membership in our Sky Club and other program awards. In the Merger, we assumed Northwest's frequent flyer...

  • Page 58
    ...We capitalize certain internal and external costs incurred to develop and implement software. For the years ended December 31, 2010, 2009 and 2008, we recorded $71 million, $95 million and $99 million, respectively, for amortization of capitalized software. The net book value of these assets totaled...

  • Page 59
    ...for sale. To determine whether impairments exist for aircraft used in operations, we group assets at the fleet-type level (the lowest level for which there are identifiable cash flows) and then estimate future cash flows based on projections of capacity, passenger mile yield, fuel costs, labor costs...

  • Page 60
    ... value. Income Taxes We account for deferred income taxes under the liability method. We recognize deferred tax assets and liabilities based on the tax effects of temporary differences between the financial statement and tax bases of assets and liabilities, as measured by current enacted tax rates...

  • Page 61
    ...Statements of Operations when the related revenue is recognized. Equity-Based Compensation We measure the cost of employee services in exchange for an award of equity instruments based on the grant-date fair value of the award. The fair value of our stock options is estimated using an option pricing...

  • Page 62
    ... assets or liabilities; Cost approach. Amount that would be required to replace the service capacity of an asset (replacement cost); and Income approach. Techniques to convert future amounts to a single present amount based on market expectations (including present value techniques, option-pricing...

  • Page 63
    ... to 0.999 based on interest rates applicable to the maturity dates of the respective contracts. Option contracts are valued under the income approach using option pricing models based on data either readily observable in public markets, derived from public markets or provided by counterparties who...

  • Page 64
    ... net of the related benefit obligation in pension, postretirement, and related benefits on our Consolidated Balance Sheets. For additional information regarding benefit plan assets, see Note 10. (in millions) December 31, 2010 Level 1 Level 2 Level 3 Valuation Technique Common stock U.S. Non...

  • Page 65
    ...Common Stock. Common stock is valued at the closing price reported on the active market on which the individual securities are traded. Mutual and Commingled Funds. These funds are valued using the net asset value divided by the number of shares outstanding, which is based on quoted market prices of...

  • Page 66
    ... information about our debt: December 31, (in millions) 2010 2009 Total debt at par value Unamortized discount, net Net carrying amount Fair value(1) (1) $ $ $ 15,442 (935) 14,507 15,400 $ $ $ 18,068 (1,403) 16,665 15,400 The aggregate fair value of debt was based primarily on reported market...

  • Page 67
    ...our open fuel hedge position is as follows: Percentage of Projected Fuel Requirements Hedged Fair Value at December 31, 2010 (in millions, unless otherwise stated) 2011 2012 Total 36% 1 $ $ 328 24 352 In the Merger, we assumed all of Northwest's outstanding fuel hedge contracts. On the Closing...

  • Page 68
    ...) Income Year Ended December 31, 2009(1) 2008(1) 2010 2009 2008 2010 2010 2009 2008 (in millions) Designated as hedges Fuel hedge swaps, collars, and call options $ 153 $ 1,268 Interest rate swaps and call options (28) 51 Foreign currency exchange forwards and collars (73) 11 Total designated...

  • Page 69
    ... sale of mileage credits under our SkyMiles Program to participating airlines and non-airline businesses such as credit card companies, hotels and car rental agencies. The credit risk associated with these receivables is minimal and that the allowance for uncollectible accounts that we have provided...

  • Page 70
    ... 2008, we experienced a significant decline in market capitalization primarily from record high fuel prices and overall airline industry conditions. In addition, the announcement of our intention to merge with Northwest established a stock exchange ratio based on the relative valuation of Delta...

  • Page 71
    ... debt American Express Agreement Clayton County Bonds, Series 2009 due in installments from 2014 to 2035 Other unsecured debt due in installments from 2011 to 2030 Total unsecured debt Total secured and unsecured debt Unamortized discount, net Total debt Less: current maturities Total long-term debt...

  • Page 72
    ... to net income ("EBITDAR") to (2) the sum of gross cash interest expense, cash aircraft rent expense and the interest portion of our capitalized lease obligations, for successive trailing 12-month periods ending at each quarter-end date through the maturity date of the respective Senior Secured Exit...

  • Page 73
    ... under fuel hedging arrangements incurred prior to the closing date of the Senior Secured Credit Facilities) to (2) the sum of cash interest expense plus cash aircraft rent expense plus the interest portion of Delta's capitalized lease obligations) in each case for the 12-month period ending as...

  • Page 74
    .... In addition, in the event (1) the collateral coverage ratio (defined as the ratio of aggregate current market value of the collateral to the sum of the aggregate outstanding exposure under the Senior Secured Credit Facilities and certain obligations with equal rights to payment and collateral, the...

  • Page 75
    ... delivered and financed in 2009 and for general corporate purposes. The remaining $347 million was held in escrow and used to refinance 22 aircraft that secured our 2000-1 EETC prior to its maturity in November 2010. The 2009-1 EETC has a weighted average fixed interest rate of 8.1% and has a final...

  • Page 76
    ...credit card holders may check their first bag for free on every Delta flight through June 2013, (2) changes the SkyMiles Usage Period to a three-year period beginning in December 2011 from a two-year period beginning in December 2010, and (3) gives American Express the option to extend the agreement...

  • Page 77
    ..., net Less: current obligations under capital leases Long-term capital lease obligations Operating Leases Contract Carrier Aircraft Lease Payments(2) $ $ 214 193 160 130 124 404 1,225 (487) 738 7 (119) 626 Years Ending December 31, (in millions) Delta Lease Payments(1) Total 2011 2012 2013...

  • Page 78
    ... the scheduling, pricing, reservations, ticketing and seat inventories of those aircraft and retain the revenues associated with those flights. 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...

  • Page 79
    ... shows the available seat miles ("ASMs") and revenue passenger miles ("RPMs") operated for us under capacity purchase agreements with our Contract Carriers. It excludes Comair for all years presented, and also excludes Compass and Mesaba for the years ended December 31, 2009 and 2008: (in millions...

  • Page 80
    ... early stages or the plaintiff does not specify the damages being sought. Credit Card Processing Agreements Our VISA/MasterCard and American Express credit card processing agreements provide that no cash reserve ("Reserve") is required, and no withholding of payment related to receivables collected...

  • Page 81
    ...which Collective Bargaining Agreement Becomes Amendable Employee Group Union Delta Pilots Delta Flight Superintendents (Dispatchers) Comair Pilots Comair Maintenance Employees Comair Flight Attendants 77 10,900 350 1,100 350 700 ALPA PAFCA ALPA IAM IBT December 31, 2012 December 31, 2013 March...

  • Page 82
    ... the December 2010 quarter, we began a redevelopment project at John F. Kennedy International Airport ("JFK"). At JFK, we currently operate primarily at Terminal 2 for domestic flights and Terminal 3 for international flights under leases with the Port Authority of New York and New Jersey ("Port...

  • Page 83
    ...use of terminal facilities at JFK were approximately $135 million in 2010, and we estimate our future annual payments will be approximately $200 million after the project is complete in 2016. Future payments will vary based on our share of total passenger and baggage counts at Terminal 4, the number...

  • Page 84
    ...) 2010 2009 Deferred tax assets: Net operating loss carryforwards Pension postretirement and other benefits AMT credit carryforward Deferred revenue Rent expense Reorganization items, net Fuel hedge derivatives Other temporary differences Valuation allowance Total deferred tax assets Deferred tax...

  • Page 85
    ... tax benefits in interest expense and operating expense, respectively. The impact related to interest and penalties on our Consolidated Statements of Operations for the years ended December 31, 2010, 2009 and 2008 was not material. We are currently under audit by the IRS for the 2008, 2009 and 2010...

  • Page 86
    ...family members. Defined Benefit Pension Plans. We sponsor a defined benefit pension plan for eligible pre-Merger non-pilot Delta employees and retirees (the "Delta NonPilot Plan") and defined benefit pension plans for eligible pre-Merger Northwest employees and retirees (the "Northwest Pension Plans...

  • Page 87
    ... all employees are eligible for benefits under these plans in the event of a participant's death and/or disability. Benefit obligations, fair value of plan assets, and funded status were: Pension Benefits December 31, 2010 2009 Other Postretirement and Postemployment Benefits December 31, 2010 2009...

  • Page 88
    ... Year Ended December 31, 2010 2009 2008 (in millions) Service cost Interest cost Expected return on plan assets Amortization of prior service cost Recognized net actuarial (gain) loss Settlement charge, net Special termination benefits Net periodic cost Defined contribution plan costs Total cost...

  • Page 89
    ... based in part on a review of historical asset returns, but also emphasize current market conditions to develop estimates of future risk and return. Plan Assets. We have adopted and implemented investment policies for our defined benefit pension plans and disability and survivorship plan for pilots...

  • Page 90
    ...sponsor defined benefit pension plans for eligible employees in certain foreign countries. These plans did not have a material impact on our Consolidated Financial Statements in any period presented. Profit Sharing Program. Our broad based employee profit sharing program provides that, for each year...

  • Page 91
    ... public announcement on April 14, 2008 of the then planned Merger and (2) capitalized Merger-related transaction costs. The purchase price also included the fair value of Delta stock options and other equity awards issued on the Closing Date in exchange for similar securities of Northwest. Northwest...

  • Page 92
    ... Other current assets Property and equipment Goodwill Identifiable intangible assets Other noncurrent assets Long-term debt and capital leases Pension and postretirement related benefits Air traffic liability and frequent flyer deferred revenue Other liabilities assumed Total purchase price...

  • Page 93
    ... for awards with installment vesting. The following table shows non-cash equity compensation expense recognized in salaries and related costs on our Consolidated Statements of Operations: (in millions) 2010 Year Ended December 31, 2009 2008 Restricted stock Stock options Performance shares Total...

  • Page 94
    ... to the closing price of Delta common stock on the grant date. Generally, outstanding employee stock options vest over several years and have a 10-year term, subject to the employee's continued employment. We determine the fair value of stock options at the grant date using an option pricing model...

  • Page 95
    ... chief operating decision maker and used in resource allocation and performance assessments. We are managed as a single business unit that provides air transportation for passengers and cargo. This allows us to benefit from an integrated revenue pricing and route network. Our flight equipment forms...

  • Page 96
    ... of Northwest operations into Delta, including costs related to information technology, employee relocation, employee training, and re-branding of aircraft and stations. In 2008, merger-related items primarily relate to non-cash charges related to the issuance or vesting of employee equity awards in...

  • Page 97
    ...'s Plan of Reorganization. The following table shows our computation of basic and diluted earnings (loss) per share: (in millions, except per share data) Year Ended December 31, 2010 2009 2008 Net income (loss) Basic weighted average shares outstanding Dilutive effects of share based awards Diluted...

  • Page 98
    ...at a fixed rate of 6.375% per year and has a final maturity in January 2016. We received $75 million in net proceeds from the 2010-2B EETC at the closing of the offering. The remaining $59 million is being held in escrow until we refinance other aircraft, including 10 aircraft currently securing our...

  • Page 99
    ...31, 2009, Northwest merged with and into Delta, ending Northwest's separate existence. We are currently integrating policies, processes, people, technology and operations for the combined company. Management will continue to evaluate our internal control over financial reporting as we execute Merger...

  • Page 100
    ... sheets of Delta Air Lines, Inc. as of December 31, 2010 and 2009, and the related consolidated statements of operations, stockholders' equity, and cash flows for the years ended December 31, 2010, 2009 and 2008 of Delta Air Lines, Inc. and our report dated February 15, 2011 expressed an unqualified...

  • Page 101
    ... table provides information about the number of shares of common stock that may be issued under the 2007 Performance Compensation Plan, Delta's only equity compensation plan, as of December 31, 2010. (b) WeightedAverage Exercise Price of Outstanding Options, Warrants and Rights (c) No. of Securities...

  • Page 102
    ..., 2010, 2009 and 2008 Consolidated Statements of Cash Flows for the years ended December 31, 2010, 2009 and 2008 Consolidated Statements of Stockholders' Equity for the years ended December 31, 2010, 2009 and 2008 Notes to the Consolidated Financial Statements (2). The schedule required by this item...

  • Page 103
    ...thereunto duly authorized, on the 15th day of February, 2011. DELTA AIR LINES, INC. By: /s/ Richard H. Anderson Richard H. Anderson Chief Executive Officer Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below on the 15th day of February, 2011 by the...

  • Page 104
    ..., and Calyon New York Brand and RBS Securities Corporation, as co-documentation agents (Filed as Exhibit 10.1(a) to Delta's Quarterly Report on Form 10-Q for the quarter ended June 30, 2009).* Second Lien Term Loan and Guaranty Agreement, dated as of April 30, 2007, among Delta Air Lines, Inc...

  • Page 105
    ... to Northwest's Quarterly Report on Form 10-Q for the quarter ended March 31, 2008).* Form of Award Agreement for Non-Qualified Stock Options Granted to Employees under the Northwest Airlines Corporation 2007 Stock Incentive Plan (Filed as Exhibit 99.5 to Northwest's Current Report on Form 8-K filed...

  • Page 106
    ... to Form of Award Agreement for Non-Qualified Stock Options Granted to Directors under the Northwest Airlines Corporation 2007 Stock Incentive Plan (Filed as Exhibit 10.6 to Northwest's Quarterly Report on Form 10-Q for the quarter ended March 31, 2008).* Form of Offer of Employment dated October 31...

  • Page 107
    Exhibit 10.4 EXECUTION ANCHOR TENANT AGREEMENT dated as of December 9, 2010 between JFK INTERNATIONAL AIR TERMINAL LLC and DELTA AIR LINES, INC.

  • Page 108
    ... Section 2.02. Use Rights Section 2.03. Additional Phase I Gates; Hardstand Positions Section 2.04. Nonresidential Real Property; Non-Severable Section 2.05. Noninterference ARTICLE 3. TERM Section 3.01. Effective Date Of This Agreement; Duration Of Agreement Term ARTICLE 4. REPRESENTATION AND...

  • Page 109
    ... 8.01. Use Section 8.02. Operation As Air Terminal Section 8.03. Port Authority Rules And Regulations Section 8.04. Terminal 4 Rules And Regulations Section 8.05. Ramp Services And Passenger Handling Section 8.06. In-flight Meals; etc. Section 8.07. FIDS And BIDS Section 8.08. Public Address And...

  • Page 110
    .... Use of IAT Gates Section 13.03. Mutual Agreement During Airport-wide or Terminal-wide Irregular Operations ARTICLE 14. CONCESSIONS Section 14.01. Concessions Operations Section 14.02. Concession Master Plan Section 14.03. Failure To Perform Concession Management Services ARTICLE 15. BOOKS, RECORDS...

  • Page 111
    ... Assignment by IAT; Recognition, Non-Disturbance, Attornment and Consent Agreement ARTICLE 19. TAXES Section 19.01. Delta Responsibility For Taxes Section 19.02. IAT Responsibility For Taxes Section 19.03. Delta Tax Liens ARTICLE 20. INSURANCE Section 20.01. IAT Insurance Section 20.02. Property...

  • Page 112
    ...Interest In Terminal 4 Section 22.04. Restoration; Relocation; Adjustment To Rent Section 22.05. Payment Of Awards Section 22.06. Sale In ...ARTICLE 26. DELTA EVENT OF DEFAULT; IAT REMEDIES Section 26.01. Delta Event Of Default Section 26.02. Monetary Default Section 26.03. Non-monetary Default Section...

  • Page 113
    ....01. Disclosure, Confidentiality And Public Announcements Section 31.02. Confidential Information Section 31.03. Survival ARTICLE 32. OTHER REQUIREMENTS Section 32.01. Federal Airport Aid Assurances ARTICLE 33. DISCRIMINATION AGAINST INDIVIDUALS Section 33.01. Port/IAT Lease; Federal Law Section 33...

  • Page 114
    ... Releases Section 34.04. Post-Term Obligations Section 34.05. Remedial Standards Section 34.06. Agents and Contractors Section 34.07. Environmental Information Section 34.08. Access Section 34.09. Third Parties Section 34.10. Survival ARTICLE 35. PHASE II/III OPTIONS Section 35.01. Phase II...

  • Page 115
    ...Contract Language Reserved Reserved Form of Recognition, Non-Disturbance, Attornment and Consent Agreement Reserved Form of License Agreement between IAT and Scheduled Aircraft Operators (other than ATA Airline Sublessees) for use of Delta Gates and Delta Hardstand Positions Form of Letter of Credit

  • Page 116
    ... place of business at 1030 Delta Boulevard, Atlanta, Georgia 30354 (together with its permitted successors and assigns "Delta"). WITNESSETH: WHEREAS, the City owns the Airport which includes the Terminal 4 Site on which Terminal 4 is located; and WHEREAS, the Port Authority currently leases the land...

  • Page 117
    ... or President or Vice President and Chief Financial Officer of JFK IAT Member, and (ii) with respect to Delta, any Delta employee with the title of Director - Corporate Real Estate, Senior Vice President - Finance, Vice President - Corporate Real Estate, Vice President-Airport Customer Service-JFK...

  • Page 118
    ... Date or the Termination Date (as applicable). "AOA" means the air operation areas as defined in 49 C.F.R. § 1542.203 now or hereafter located on the Airport. "Approved Contractor" means any third party contractor that possesses the required permits from the Port Authority to perform the services...

  • Page 119
    ... IAT acknowledge that Delta shall pay Delta's Share of ATA Permitted Remediation Costs. "ATA Airline Sublease" means a Sublease made by Delta to any Delta Affiliate Carrier, or IAT to any Contract Carrier, in each case in accordance with the terms of the Port/IAT Lease, this Agreement and the Port...

  • Page 120
    ...the land on which the Airport is located. "Basis of Design" means, collectively, (i) Delta Air Lines JFK Terminal 4 Concourse B Extension Basis of Design, Job Number 132040; (ii) Delta Air Lines JFK Terminal 4 Headhouse Expansion Basis of Design, Job Number 132040; and (iii) Passenger Bridge T3 / T4...

  • Page 121
    ...the Construction Administration Services Agreement, dated as of April 13, 2010, between Delta and the Construction Administrator, as approved by IAT and as amended or replaced from time to time in accordance with the terms of this Agreement. "Construction Contract Assignment Agreement" is defined in...

  • Page 122
    ...Defense Notice" is defined in Section 24.03. "Delta Affiliate Carrier" means (i) any Scheduled Aircraft Operator that has been granted by the United States Department of Transportation immunity from the United States antitrust laws with respect to an international airline alliance with Delta, or (ii...

  • Page 123
    ... officers, directors, employees, agents, invitees and contractors. "Delta Schedule" is defined in Section 13.01(a). "Delta Space" is defined in Section 2.01(d). "Delta Space Permit" means the John F. Kennedy International Airport Terminal 4 Space Permit, dated as of January 1, 2009, between...

  • Page 124
    determination, divided by the total number of passengers arriving and departing from Terminal 4 during the applicable period; provided that, under no circumstance shall Delta's Share of ATA Permitted Remediation Costs include any Assumed Environmental Damages consisting of costs or expenses related ...

  • Page 125
    .... "Force Majeure Events" is defined in Section 36.01. "GAAP" means generally accepted accounting principles in the United States as in effect from time to time as promulgated by the Financial Accounting Standards Board, which establishes standards for financial accounting and reporting that are...

  • Page 126
    ... Handling Services", which include, but are not limited to, passenger ticketing, passenger assistance and passenger information services. "Hardstand Position" means a remote aircraft parking position on the Terminal 4 Site not located at a Gate. "Hazardous Substance" is defined in the Port/IAT Lease...

  • Page 127
    ... other than Delta (including for shared use by IAT and one or more such Sublessees) for office, clubroom, passenger lounge, storage or other purposes, or that are not otherwise open to the general public, wherever such space may be located from time to time. "IAT Parties" is defined in Section...

  • Page 128
    ..." means the long-term plans for the development of the Terminal 4 Site and the Terminal 3 Site as shown in Exhibit B attached hereto, which resulted from the cooperative planning efforts of Delta, IAT and the Port Authority, and which may change from time to time by agreement among Delta, IAT and...

  • Page 129
    ... B of Terminal 4 to add 11 regional jet Gates as shown on Exhibit B, page 2. "Phase II Space" is defined in Section 35.01. "Phase II/III Option" is defined in Section 35.01. "Phase III" means the final phase of the Master Plan as it may change from time to time by agreement among Delta, IAT and...

  • Page 130
    ... at the Airport in order to facilitate the availability of the applicable Gates for Delta's use as provided for in this Agreement, that shall provide, inter alia, that such Contract Carriers will not be forced to leave Terminal 4. IAT will periodically consult with the Airport General Manager during...

  • Page 131
    ... that, the cost of employees of Delta allocable to design, construction and completion of the Phase I IAT Project shall not exceed $1,000,000. "Public Aircraft Facilities" is defined in the Port/IAT Lease and means the following facilities, as they may from time to time be provided and maintained by...

  • Page 132
    ... 6 Debt Service (as such term is defined in the Port/IAT Lease). "Semi-Annual Period" means each period commencing on December 1, or the Effective Date if this Agreement becomes effective after December 1 of a calendar year and before June 1 of the immediately succeeding calendar year, and ending on...

  • Page 133
    ...this Agreement expires or terminates prior to such November 30. "Series 6 Bond Documents" means the Series 6 Bonds and the documents related thereto listed in Schedule 4-2. "Series 6 Bonds" means The Port of Authority of New York and New Jersey, Special Project Bonds, Series 6, JFK International Air...

  • Page 134
    ....01. "Taxiways" is defined in the Port/IAT Lease. "Tax Lien" means the imposition of a lien, levy or charge by a Governmental Authority against the Delta Premises, Terminal 4 or the Airport resulting from the failure to pay taxes. "Term" means the period from and including the Effective Date to and...

  • Page 135
    ... and building fixtures now or hereafter located on the Terminal 4 Site, and (iii) the related aircraft parking, apron, ramp, taxiway and other aircraft operations areas, and has the same meaning as the term "Premises" under the Port/IAT Lease. "Terminal 4 Gate Use Fee" is defined in Schedule...

  • Page 136
    ... and its agencies, departments, bureaus, boards and instrumentalities. "Unrestricted Cash" means the sum of the line items "Cash" and "Short-Term Investments" in Delta's most recent publicly available financial statements, or if not publicly available, as provided to Bond Insurer, whether audited or...

  • Page 137
    ... of immediate borrowing availability under committed credit agreements, for which Delta is in compliance and is the borrower. (b) Capitalized terms used but not defined herein have the meanings assigned to them in the Port/IAT Lease. The substantive meaning of the capitalized terms set forth herein...

  • Page 138
    ... at issue contains a covenant, representation or warranty of such party; (xvi) all obligations of either party to this Agreement shall be satisfied by such party at such party's sole cost and expense; and (xvii) all rights and powers granted to either party hereunder shall be deemed to be coupled...

  • Page 139
    ... reasons related to the Phase I IAT Project, IAT shall use reasonable efforts to provide comparable Hardstand Positions, both in number and location, to replace any such unavailable Hardstand Positions, and IAT's failure to provide such comparable Hardstand Positions shall not constitute a breach of...

  • Page 140
    ... in the Headhouse, including Location Number 112.021 in the West Arrivals Hall, shown as "Delta Space" on Exhibit A-1, pages 1 and 7; (8) Three curbside check-in counters by door #3 on the Departures Level of Terminal 4 shown on Exhibit A-1, pages 4 and 9; (9) Use rights with respect to a portion...

  • Page 141
    ... and benefit during the Term to be occupied and used pursuant to this Agreement by Delta, its ATA Airline Sublessees and their respective officers, employees, passengers, customers, patrons, contractors, suppliers and invitees (subject to the proviso set forth in Section 2.01(a)(i)(3), in which case...

  • Page 142
    ...IAT Lease) located on the Airport and connections thereto appurtenant to the Delta Gates from time to time, to use the same to distribute fuel for Delta and its ATA Airline Sublessees, all in accordance with the applicable provisions of the Port/IAT Lease and the Port Authority Rules and Regulations...

  • Page 143
    ... 2.01(a)(ii)(6) has been prepared based on such assumption) that all ground support equipment reasonably required to support the operations of the applicable Contract Carriers at the applicable Gates and Hardstand Positions at Terminal 4 and the operation of the Delta Premises can be accommodated on...

  • Page 144
    ... the Delta Space. (b) Delta agrees that it will use, and will cause its Sublessees to use, commercially reasonable efforts not to unreasonably hinder, impede, or interfere with IAT's and its Sublessees' rights, benefits, obligations and responsibilities under this Agreement, or the Port/IAT Lease or...

  • Page 145
    ...01. Effective Date Of This Agreement; Duration Of Agreement Term. This Agreement shall become effective on the Effective Date, and the leasehold estate created in this Agreement shall then begin, provided that, Delta's right to possession of the Delta Premises as the same may exist from time to time...

  • Page 146
    ... of New York. IAT is duly authorized to conduct business under the Laws of each jurisdiction where such qualification is required, including the State of New York. (d) Power. IAT has all requisite limited liability company power and authority to enter into, execute and deliver this Agreement and...

  • Page 147
    ... to IAT, all rules, regulations and orders of the Port Authority applicable to IAT and all indentures, agreements and other instruments binding upon IAT, in each case, to the extent the noncompliance with which would have a material adverse effect on (i) IAT's ability to perform or comply with...

  • Page 148
    ...to terminate any right or accelerate the payment or performance of any obligation of Delta thereunder, and (iv) result in the creation or imposition of any lien on any asset of Delta. (f) Compliance with Laws and Agreements. Delta is in compliance in all material respects with all Laws and orders of...

  • Page 149
    ... to a legitimate business purpose, but rather to disadvantage Delta during an Event of Default; provided, further, that, if IAT determines (after reasonable consultation with Delta) that any insurance required pursuant to the terms of the Port/IAT Lease is not available on commercially reasonable...

  • Page 150
    ... Bonds), fees, charges or payments required to be paid by IAT under the Port/IAT Lease, except for Delta's share thereof to be paid by Delta to IAT as expressly provided in this Agreement; (ii) other than as expressly provided in Section 21.04 (regarding insurance carried by Delta) or in Section 24...

  • Page 151
    ...the Trustee[s], if required) may agree or on the effective date of any revocation of the Port Authority Consent to Sublease, provided that, (i) this Agreement shall not terminate or expire in connection with any assignment or foreclosure of the Port/IAT Lease, or the execution of a New Lease, by the...

  • Page 152
    ... to perform, any activities or services at the Airport for which the Port Authority requires the payment of fees and/or the issuance of a Port Authority permit, unless Delta pays such required fees and/or obtains such required permit. (k) In the event that IAT terminates the Port/IAT Lease pursuant...

  • Page 153
    ... II and Phase III; provided that, during an Event of Default by Delta in respect of Delta's obligations regarding performing the Phase I IAT Project in accordance with Article 6, Delta's consent shall not be required for any financing or refinancing of the Terminal 4 Project Bonds if such financing...

  • Page 154
    applicable provisions of the Port/IAT Lease and the Bond Documents, any amount paid or payable (as the case may be, a "Reimbursement") to Delta by the Construction Administrator, any Approved Contractor, any Construction Contractor, any insurance provider, any Governmental Authority or any other ...

  • Page 155
    ...and other changes relating thereto in effect as of the date hereof, including all Change Orders (as defined in the Port/IAT Lease), that have been approved by IAT and Delta. IAT and Delta hereby acknowledge and agree that they have approved the documents listed on said Schedule 6-1 ("Base Line Plans...

  • Page 156
    ... to pay Project Costs or reimburse Delta for Project Costs, subject to receipt from Delta of (x) the Standard Draw Documentation (appropriately completed), and (y) the applicable information referenced in Schedule 6-3 together with the supporting documentation as may be reasonably required in...

  • Page 157
    ... that, failure to obtain such language in the applicable Phase I IAT Project Construction Contract shall not preclude Delta from hiring such contractor. Subject at all times to the other provisions of this Agreement, provided that no Delta Event of Default shall have occurred and is then continuing...

  • Page 158
    ... Consent and Agreement and/or the Phase I IAT Project Construction Contract, as applicable. Upon an election by IAT as set forth in the preceding sentence, (i) Delta's right to request draws from the proceeds of the Terminal 4 Project Bonds shall terminate, and (ii) provided that any changes to and...

  • Page 159
    ... Event. Delta and IAT shall work cooperatively to avoid such Cost Overruns through mutually and reasonably agreed reductions in scope, extensions of delivery dates, changes in design or materials, changes in terms of Phase I IAT Project Construction Contracts and/or the Phase I IAT Project Contract...

  • Page 160
    ...Lease, (iv) applicable Port Authority Rules and Regulations and approvals, and (v) the provisions of this Section 6.04 and the other applicable provisions of this Agreement. (b) Delta's trade fixtures shall be designed and installed to meet Delta's requirements and specifications. Delta has provided...

  • Page 161
    ... Port Authority pursuant to this Agreement or the Port/IAT Lease, shall remain the property of Delta and shall be removable at any time by Delta, including upon the expiration or termination of the Term, provided that, Delta shall repair any damage to the Delta Premises caused by the removal thereof...

  • Page 162
    ... Regulations, the Terminal 4 Rules and Regulations, the Terminal 4 Security Plan and other requirements under Law or as required by any Governmental Authority, the Port Authority, Delta, the Construction Administrator, Delta's contractors, subcontractors, consultants, suppliers and service providers...

  • Page 163
    ...responsible party), set forth on Schedule 6-4, which shall govern the process flow, project management and day-to-day operations in connection with the construction of the Phase I IAT Project, in each case subject to the terms of this Agreement, including the requirements of Section 10.04 in respect...

  • Page 164
    ...DBO in respect of the rental for the Delta Premises (inclusive of any and all charges for O&M Services) (i) the cost of all debt service (net of interest on any reserve and sinking fund accounts if such interest is available for payment of such debt service) and financing costs payable in respect of...

  • Page 165
    ... certified public accountant (in the case of annual statements), setting forth actual ATA Permitted O&M Expenses and the actual amount of ATA Permitted O&M Expenses for Common Space (by category of expense), passenger activity and actual Delta Rent, actual credits to Delta for Terminal 4 Gate Use...

  • Page 166
    ... result from Delta's failure to timely pay to IAT any amounts due and payable by Delta to IAT under this Agreement, provided that IAT has used commercially reasonable efforts to satisfy such payment obligations to the Port Authority through the use of other funds available to IAT in order to avoid...

  • Page 167
    ... the Delta Premises for office facilities or other operations other than for office facilities or other operations that are directly related to the day-to-day operations at the Airport. Section 8.02. Operation As Air Terminal. At all times during the Term, IAT shall operate Terminal 4 as an airline...

  • Page 168
    ...its passengers using premium lounge areas and/or its employees, provided that, Delta shall be responsible for any fees required by the Port/IAT Lease in connection therewith. Section 8.07. FIDS And BIDS. IAT shall provide and operate the hardware and software providing flight and baggage information...

  • Page 169
    ... the Terminal 4 Rules and Regulations, provided that, Delta's right to use the FIDS and BIDS, to have direct access to input information directly into such systems and to make flight information and baggage information available to the public shall be limited to information relating to Delta, Delta...

  • Page 170
    ...Parking Space Permit is in effect, and IAT shall be managing the hardstand positions on the Terminal 3 Site, IAT shall credit Delta Rent for each use of a hardstand parking position on the Terminal 3 Site by a Scheduled Aircraft Operator (other than Delta or any Delta Affiliate Carrier) in an amount...

  • Page 171
    ... license for the term of this Agreement to (i) display Delta's name, trade name and certain service marks as each exists from time to time (the "Delta Marks") on the FIDS and directional and operational signage, and at other locations in Terminal 4 for the purpose of providing informational and/or...

  • Page 172
    ..., non-transferable, limited license for the term of this Agreement to display IAT's and/or IAT's name, trade name and certain service marks as each exists from time to time (the "IAT Marks") in Delta advertising, brochures or other marketing and informational material relating to Terminal 4, subject...

  • Page 173
    ... anything herein to the contrary, to the extent that IAT's consent is required for Delta's use of same, IAT hereby irrevocably grants to Delta the right to use during the Term the names "Terminal 4" and "Terminal Four" or any other name by which Terminal 4 is commonly known from time to time. 58

  • Page 174
    ... standards for a common use international gateway airport terminal in a major city or such other standard established by the Management Committee from time to time (the "Terminal 4 O&M Performance Standards"). Section 9.04. Delta Janitorial Services. Delta may elect to provide cleaning and rubbish...

  • Page 175
    ... condition. If IAT does not perform such Emergency Repairs with ten (10) days of receipt of notice from Delta, or such shorter period as may be reasonably necessary to protect against an imminent threat to life, material property damage or security of the Delta Premises, Delta may (after making such...

  • Page 176
    ... Committee shall report directly to the Management Committee. Insofar as the Operations Advisory Committee's recommendations impact Contract Carriers, such policies shall be reasonable, equitable and nondiscriminatory and shall at all times comply with the requirements of the Port/IAT Lease. The...

  • Page 177
    ... IAT with respect to the location of Contract Carrier operations on the Delta Space as set forth in Article 13; (x) establishing subcommittees as necessary from time to time to address particular matters identified by IAT and/or Delta and to report to the Management Committee with respect thereto...

  • Page 178
    ...; Calculation of Delta Rent And Adjusted Terminal Management Fees. (a) Not later than September 1 of each calendar year, Delta shall prepare and furnish to IAT a statement of Delta's and Delta Affiliate Carriers' actual to date and projected flight and passenger usage for the current Annual Period...

  • Page 179
    ... rent statement for the applicable Annual Period, itemized in detail reasonably requested by Delta, projecting the amounts of the Delta Rent (including any anticipated credits attributable to the Terminal 4 Gate Use Fees or Terminal 4 Hardstand Use Fees) and the Adjusted Terminal Management Fees...

  • Page 180
    ...(ii) 50% of the Capital Improvements Reserve Fund Requirement (as defined in the Port/IAT Lease) during such Annual Period without the approval of Delta. Notwithstanding any of the foregoing, in the event of an emergency or if an expenditure is necessary to comply with applicable Law or the Port/IAT...

  • Page 181
    ....02. Terminal 4 Security. (a) The "Terminal 4 Security Plan" means the Terminal 4 Security Plan, current as of the Effective Date, established by IAT and submitted to the Port Authority, setting forth the security rules, regulations and procedures relating to the use and operation of Terminal 4, as...

  • Page 182
    ... by the Port/IAT Lease, the Port Authority Rules and Regulations, the Port Authority Airport Security Program, the Terminal 4 Rules and Regulations, and the Terminal 4 Security Plan (as applicable). Delta shall provide all applications, background checks and other information required by the Port...

  • Page 183
    ... 4 to install signage pursuant to Section 12.04, provided that, in all cases such Alterations are in compliance with the Terminal 4 Rules and Regulations and could not reasonably be expected to materially adversely affect the operation and use by IAT and its Sublessees of any other portions of...

  • Page 184
    ... throughout Terminal 4 operational and directional signage in compliance with Port Authority Rules and Regulations and any other applicable Law. Section 12.05. Mechanic's And Materialman's Liens. No work performed by IAT, on the one hand, or Delta, on the other hand, pursuant to this Agreement or...

  • Page 185
    ...shall be asserted by the Construction Contractor against Terminal 4, the Airport or the interest of IAT or the Trustee (or any nominee, transferee or assignee thereof) under the Port/IAT Lease or this Agreement by reason of any work performed for or materials furnished by the Construction Contractor...

  • Page 186
    ... available Delta Gates and Delta Hardstand Positions subject to the times, slot lengths and other conditions that are so scheduled. (b) Delta shall, subject to the Terminal 4 Rules and Regulations, have first priority for scheduling and use for Delta and Delta Affiliate Carrier flights at the Delta...

  • Page 187
    ... equal to the Terminal 4 Hardstand Use Fee. (v) As a condition precedent to the use of any of the Delta Gates or the Delta Hardstand Positions by any Scheduled Aircraft Operator other than Delta or Delta Affiliate Carriers, IAT will obtain from such Scheduled Aircraft Operator, duly executed by such...

  • Page 188
    ... shall solicit Scheduled Aircraft Operators to become Contract Carriers for such designated Delta Gates, for a term acceptable to Delta (provided that Delta's identification of available Delta Space shall be exercised for legitimate business purposes consistent with the Delta network plan and shall...

  • Page 189
    ... and operational matters) to schedule such Delta or Delta Affiliate Carrier flight to an IAT Gate or Hardstand Position if permitted by the schedule established in accordance with Section 13.01(a). For each use of an IAT Gate by Delta or a Delta Affiliate Carrier, Delta shall pay IAT the Terminal...

  • Page 190
    ...I IAT Project Construction Period in order to allow time for IAT's development and implementation of the Concession Master Plan prior to Phase I DBO. Thereafter the Concessions Subcommittee shall meet at such times as may be required to address issues related to the performance under, and changes to...

  • Page 191
    ... of Concession Space, (iv) addressing any nuisance affecting the Delta Premises resulting from the operations of adjacent Concession Space, and (v) reviewing signage and promotion for concessions, concessions mix, concession performance, and concession standards, rules and regulations. Section 14.03...

  • Page 192
    ... and IAT all travel costs and expenses for Port Authority and IAT auditors and other representatives in connection with any audit at locations outside the Port of New York District, Delta may make said records and books of account available to the Port Authority and IAT at Delta's offices or the...

  • Page 193
    ... to the extent provided for in said Section 60(e)) of the Port/IAT Lease, during ordinary business hours, at Terminal 4 or another location in the Port of New York District, or, on the condition that such Delta Recordkeeper shall pay to the Port Authority and IAT all travel costs and expenses for...

  • Page 194
    ...Delta's prior fiscal year total passenger revenue as determined based on Delta's annual filing on Form 10-K with the SEC (a "Liquidity Trigger"), or (y) Delta's credit card processors have commenced a holdback on payment processing (a "Holdback Trigger"), Delta shall promptly either (i) deliver cash...

  • Page 195
    ... 6 Bonds outstanding, Delta agrees to provide to the Bond Insurer (i) monthly reports reflecting Delta's total Liquidity, within ten (10) Business Days following the end of each calendar month (each, a "Liquidity Report"), and (ii) Delta's annual and quarterly Forms 10-K and 10-Q filed with the SEC...

  • Page 196
    ..., IAT shall enter into operating agreements with such Delta Affiliate Carrier containing appropriate indemnification and insurance provisions for the benefit of IAT, and the Port Authority together with requirements for complying with the Terminal 4 Rules and Regulations. Delta shall be entitled to...

  • Page 197
    ...the net worth of Delta at the time of such transaction. (e) No provision of this Agreement, including the rights, benefits and easements granted in Article 2, is intended to or shall be interpreted as providing to Delta or its Sublessees or their respective officers, employees, passengers, customers...

  • Page 198
    ... and Consent Agreement. Delta understands and agrees that (i) IAT may pledge and assign to the Port Authority, as security for IAT's performance of its obligations due to (x) the Port Authority under the Port/IAT Lease and (y) the Trustee and the holders of the Terminal 4 Project Bonds under...

  • Page 199
    ... the foreclosure of such Delta Tax Lien against Delta's interest under this Agreement, the Delta Premises, Terminal 4 and/or the Airport (as the case may be), (ii) deliver a copy such release or discharge to IAT, (iii) file or record such discharge or release in such offices as are necessary to...

  • Page 200
    ... to certain construction work, IAT shall at all times during the Term, purchase, provide and maintain in effect, all insurance (including coverages, limits, insureds and endorsements) required pursuant to the Port/IAT Lease (but excluding the construction period insurance that was required of IAT...

  • Page 201
    ... and employers' liability insurance, shall name IAT, JFK IAT Member, Schiphol USA Inc., the Trustee, the Port Authority and the City as additional insureds and shall provide that such policies may not be materially changed, altered, or canceled by the insurer during their term without first...

  • Page 202
    ...Days after the Effective Date if the same are in effect on the Effective Date, or, if not required to be in effect on the Effective Date, within five Business Days after such insurance has been obtained), and, thereafter, prior to the expiration of the applicable policies of insurance or reinsurance...

  • Page 203
    ... 20.07. Other Insurance By Delta. Delta shall, at all times during the Term, purchase, provide and maintain in effect in its own name as insured, workers' compensation and employers' liability insurance with respect to Delta's activities or as may be required by the Port/IAT Lease or as otherwise...

  • Page 204
    ... so as to minimize the time that the damaged portions of Terminal 4 are out of service, in accordance with the as-built plans and specifications, as modified in accordance with the provisions of Article 12. (b) If Delta wishes to perform any repair or restoration work with respect to any damaged...

  • Page 205
    ... accordance with Article 20 hereof. IAT and Delta agree that any shortfalls in the insurance proceeds available for the cost of such restoration or building of Terminal 4 resulting from either party's failure to obtain and maintain required insurance, unless a party's failure to obtain and maintain...

  • Page 206
    ... of, Terminal 4 or the Delta Premises, by fire or other casualty, and Section 227 of the Real Property Law of the State of New York providing for such a contingency in the absence of express agreement, and any other law of like import now or hereafter in force, shall have no application in such case...

  • Page 207
    ... of the Terminal 4 Project Bonds, including all accrued interest and premium payments, if any, thereon; (ii) To Delta, a pro rata portion of the remaining proceeds of the Taking calculated based on the Delta Space in comparison to the total useable area of the building located on Terminal 4 in...

  • Page 208
    ...at its option, terminate this Agreement effective on the date of Taking upon notice to IAT delivered within ten (10) days after the Taking. If this Agreement is so terminated by Delta, that portion, if any, of the net proceeds (after payment of the Terminal 4 Project Bonds) of the damages awarded in...

  • Page 209
    ..., any and all awards or damages or other payments paid or payable to IAT or Delta as a result of condemnation or the exercise of the power of eminent domain shall be applied to the retirement of the Terminal 4 Project Bonds if and to the extent required by the Terminal 4 Project Bond Documents. Upon...

  • Page 210
    ... in accordance with the provisions of this Agreement as soon as is reasonably practicable. IAT agrees to use commercially reasonable efforts to pursue any remedies (in consultation with Delta) available to IAT or otherwise permitted under the Port/IAT Lease to remedy such suspension of utilities as...

  • Page 211
    ..., officers, employees, agents, representatives, contractors, passengers and invitees, and others using the Delta Space with the consent of Delta, except the IAT Users (collectively, "Delta Users") in, on or at Terminal 4, (iv) Delta's breach of, or failure to perform, any term, condition, agreement...

  • Page 212
    ...shall survive the expiration or termination of this Agreement with respect to occurrences during the Term. Section 24.03. Procedures for Third Party Claims. (a) In the event that any IAT Party or Delta Party (an "Indemnified Party") receives notice of the assertion of any claim for Damages or of the...

  • Page 213
    ... term thereof the giving by each claimant or plaintiff to each Indemnified Party which is subject to the applicable claim, or a party to the applicable action...would materially interfere with or adversely affect the business, operations or assets of the Indemnified Party. (e) Notwithstanding anything ...

  • Page 214
    ... and tear excepted, on or before the Expiration Date or Termination Date, as applicable, or at such time as IAT exercises its right to reenter the Delta Premises pursuant to Section 26.05(c) or otherwise under applicable Law. If Delta fails to peacefully vacate and deliver to IAT possession of the...

  • Page 215
    ... the date paid by IAT to the date repaid by Delta) at the rate per annum equal to the Prime Rate plus 2% (but not in excess of the highest rate permitted under applicable Law). (b) Upon the expiration or termination of this Agreement, upon IAT's request, Delta shall remove its signage as required by...

  • Page 216
    ...03. Non-monetary Default. It shall be an Event of Default if any one or more of the of the following events shall have occurred and be continuing beyond the applicable cure period set forth in Section 26.04: (a) Delta shall fail to perform or observe any material term, covenant, agreement, condition...

  • Page 217
    ...as such term is defined in the Port/IAT Lease) has been delivered by the Port Authority in accordance with the terms of the Port/IAT Lease; or (f) Delta shall fail to cause a Letter of Credit or Cash Deposit to be provided as required by Section 16.04 of this Agreement within three (3) Business Days...

  • Page 218
    ... under applicable Law, in its discretion and at its option, pursue any one or more of the following remedies, upon not less than 10 Business Days notice to Delta: (a) bring a suit, action or proceeding (summary or otherwise) to distrain for or collect, file a proof of claim in any Delta bankruptcy...

  • Page 219
    ...or any portion thereof, the damages owed by Delta hereunder shall be the net amount after giving effect to the amounts IAT receives from such reletting or reuse); and/or (d) terminate this Agreement, in which event Delta shall promptly vacate the Delta Premises and surrender the same to IAT pursuant...

  • Page 220
    ... a result of an Event of Default under this Agreement by Delta, and IAT hereby agrees to forego any rights and remedies it may have for the recovery of consequential, punitive or exemplary damages and damage awards to the extent the same are multiples of direct or other damages as provided by Law or...

  • Page 221
    ... have failed to pay, or credit, to Delta, when due and after the expiration of the applicable cure period set forth in Section 27.05, any payment of any amount required to be paid by IAT to Delta pursuant to this Agreement. Section 27.03. Non-monetary Default. It shall be an IAT Event of Default if...

  • Page 222
    ... 10 Business Days notice to IAT: (a) bring a suit, action or proceeding (summary or otherwise) before any court of competent jurisdiction for any charges, payments or credits required to be paid or credited by IAT to Delta pursuant to this Agreement that are due and owing to Delta, and for all costs...

  • Page 223
    ... other applicable agreement, under applicable Law or otherwise, subject to the provisions of this Agreement limiting or restricting liability or remedies. However, notwithstanding anything herein to the contrary, Delta shall not be entitled to have a judgment or award for, or to collect or receive...

  • Page 224
    ... Arbitration Rules of the American Arbitration Association (or any organization successor thereto) then in effect, in accordance with Title 9 of the United States Code and in accordance with the provisions of this Agreement. The arbitration shall take place in The City of New York. Disputes...

  • Page 225
    ... not add to, subtract from or otherwise modify the provisions of this Agreement, but shall base its decision and award upon and give effect to the provisions and intent of this Agreement. The decision and award shall be in writing and contain a statement of facts and the reasons for the decision and...

  • Page 226
    .... The provisions of this subsection (f) are subject in all cases to the provisions of Article 29. (g) The provision for the resolution by arbitration of any such claim, controversy or dispute where it is specifically provided in this Agreement that the same shall be submitted to arbitration shall...

  • Page 227
    ... Expenses. Without duplication of any other provision of this Agreement with respect to attorney's fees and similar expenses, in the event that (i) IAT or Delta is found to have breached this Agreement by a final, non-appealable judgment, award or other decision in any action, suit, arbitration or...

  • Page 228
    ... of the Terminal 4 Project Bond Documents, (x) the Trustee[s], any nominee of the Trustee[s], the Bond Insurer, any successor to IAT, any Interim Terminal Operator or any Qualified Terminal Operator and (y) (i) any officer, committee member, director, manager, managing director, employee, agent or...

  • Page 229
    ... of their respective Affiliates, officers, directors, members or employees to disclose to any other Person, or use for the first party's own benefit (other than in connection with the transactions contemplated by this Agreement), directly or indirectly, any Confidential Information belonging to the...

  • Page 230
    Section 31.03. Survival. This Article 31 shall survive the expiration or termination of this Agreement. 115

  • Page 231
    ... at the time or times when and to the extent that the Port Authority may direct. (b) Without limiting the generality of Section 32.01(a), this Agreement is subject to the requirements of the U.S. Department of Transportation's regulations promulgated at 49 C.F.R. Pt. 23, Subpart F. Delta agrees that...

  • Page 232
    ... anything set forth in this Agreement, neither Delta nor Delta's employees, officers, directors and agents shall discriminate in the conduct of Delta's operations at Terminal 4 against any individual in violation of Sections 290-301 of the New York State Executive Law (or any successor statute...

  • Page 233
    ... with every award or agreement for concessions or consumer services at Terminal 4, shall throughout the term of this Agreement commit itself to and use good faith efforts to implement an extensive program of affirmative action, to ensure maximum opportunities for employment and contracting by...

  • Page 234
    ... or award for concessions or consumer services at Terminal 4; however, this Section 33.04(c) is not intended to negate or supersede any such rights granted elsewhere in this Agreement. Section 33.05. Benefit Of The Port Authority. Except as otherwise provided herein, the agreements made by Delta in...

  • Page 235
    ..., its commissioners, officers, agents or employees, the governmental nature of the Port Authority, or the provisions of any statutes respecting suits against the Port Authority, without first obtaining the consent of the general counsel of the Port Authority; provided, that, the election by Delta in...

  • Page 236
    .... (a) Delta and Delta's officers, directors and employees shall comply with, and shall use commercially reasonable efforts to cause Delta's agents, contractors, invitees, Affiliates and Sublessees to comply with, all Environmental Requirements relating to (i) their respective operations and...

  • Page 237
    ... shall be performed (i) to achieve a concentration of Hazardous Substances applicable to non-residential property under then applicable Environmental Requirements or, if more stringent, the requirements set forth in the Port/IAT Lease, (ii) cost effectively, including through the use of monitoring...

  • Page 238
    ... Requirements. All reasonable requests for such information shall be fulfilled within a reasonable period of time at the requesting party's cost and expense. Section 34.08. Access. (a) Without limiting anything contained in this Agreement, IAT and its respective officers, employees, agents...

  • Page 239
    ...exercise its rights under this Section 34.08 after the end of the Term. Delta shall indemnify the IAT Parties for any Damages incurred by them as a result of the negligence of Delta or Delta's officers, employees, agents, representatives, designees, and independent contractors in the exercise of any...

  • Page 240
    ... Delta and taking into account any requirements under the Port/IAT Lease, including any requirements that Terminal 4 remain the "terminal of last resort" for 24/7 international arrivals at the Airport; (c) assurance to IAT that the quality and efficacy of the operations and construction of Terminal...

  • Page 241
    ... Delta; (f) Delta and IAT shall cooperate in good faith with each other in amending this Agreement as may reasonably be necessary to reflect the final terms of this Agreement with respect to the applicable Option Space and as required by the Port Authority, the Port/IAT Lease, the Terminal 4 Project...

  • Page 242
    consents, waivers and variances necessary or desirable to obtain the desired financing and prevent any such violation or default. 127

  • Page 243
    ... such party's control (collectively, "Force Majeure Events"), in all cases only to the extent that a Force Majeure Event directly affects such specific obligations under this Agreement, provided that, the foregoing shall not limit Delta's obligations in respect of cost overruns pursuant to Section...

  • Page 244
    ...addressee has changed its addresses by notice as provided herein, at its addresses set forth in the most-recent change-of-address notice: (i) If to IAT: JFK International Air Terminal LLC John F. Kennedy International Airport (Terminal 4) Room 161-022 Jamaica, New York 11430 Attention: President Fax...

  • Page 245
    ...without first addressing with the Port the objections, if any, raised by Delta (or if Delta fails to respond during the applicable time period, IAT may approve or reject such Condition Survey Contractor and/or Condition Survey Contract in accordance with the Port/IAT Lease); provided that, Delta and...

  • Page 246
    ... Sub-Cost Centers, provided that the benefit of the associated Approved 2026 Capital Repair accrues to the appropriate Terminal Sub-Cost Center (the "Additional Re-lifing Rental"). (d) Following each semi-annual reconciliation performed by IAT in accordance with Section 7.04 of this Agreement with...

  • Page 247
    ... replacement of) up-graded technology, systems or other improvements not located at and serving Terminal 4 as of the Effective Date; and (ii) "Costs of the 2026 Capital Repairs" means and include (i) the costs of performing any Approved 2026 Capital Repairs actually performed in connection with the...

  • Page 248
    ...BY JURY OF ANY CLAIM, DISPUTE OR CONTROVERSY BROUGHT BEFORE A COURT THAT ARISES OUT OF, RELATES TO OR IS CONNECTED WITH THIS AGREEMENT, THE USE OR OPERATION OF ANY PART OF TERMINAL 4 OR ANY BREACH OF OR FAILURE TO PERFORM ANY PROMISE, TERM, COVENANT, AGREEMENT, CONDITION, REPRESENTATION, WARRANTY OR...

  • Page 249
    ... the Budget, IAT shall not be required to provide confidential information related to the rates and charges paid by ATA Airline Sublessees under their particular Sublease, or IAT's employee compensation (other than head count and departmental cost basis used in preparing the Budget). [remainder of...

  • Page 250
    ... WHEREOF the parties have executed and delivered this Agreement as of the date first written above. JFK INTERNATIONAL AIR TERMINAL LLC By: /s/ Michael E. Sibilia Name: Title: Michael E. Sibilia Chief Financial Officer [signatures continued on next page] [Anchor Tenant Agreement Signature Page]

  • Page 251
    DELTA AIR LINES, INC. By: /s/ John W. Boatright Name: John W. Boatright Title: Vice President - Corporate Real Estate [Anchor Tenant Agreement Signature Page]

  • Page 252
    EXHIBIT A-1 Pre-DBO Premises; Location of Delta Premises; Concession Space; Concourse A; Delta Hardstand Positions [see attached]

  • Page 253
    EXHIBIT A-2 Location of Perimeter Dig Area; FIS Facility; Terminal 2-4 Connector Area [see attached]

  • Page 254
    EXHIBIT A-2-1 Triangle Plume [see attached]

  • Page 255
    EXHIBIT B Master Plan [see attached]

  • Page 256
    EXHIBIT C Approved Signage Locations [see attached]

  • Page 257
    EXHIBIT D Form of Construction Contract Assignment Agreement [see attached]

  • Page 258
    EXHIBIT E Form of Contractor Consent and Agreement (Construction Administration Agreement and Major Contracts) [see attached]

  • Page 259
    EXHIBIT F Non-Major Contract Stipulated Contract Language [see attached]

  • Page 260
    EXHIBIT G RESERVED

  • Page 261
    EXHIBIT H-1 RESERVED

  • Page 262
    EXHIBIT H-2 Form of Recognition, Non-Disturbance, Attornment and Consent Agreement [see attached]

  • Page 263
    EXHIBIT I RESERVED

  • Page 264
    EXHIBIT J Form of License Agreement between IAT and Scheduled Aircraft Operators (other than ATA Airline Sublessees) for use of Delta Gates and Delta Hardstand Positions [see attached]

  • Page 265
    EXHIBIT K Form of Letter of Credit [see attached]

  • Page 266
    SCHEDULE 1-1 ATA Permitted O&M Expenses [see attached]

  • Page 267
    SCHEDULE 4-1 Port/IAT Lease [see attached]

  • Page 268
    SCHEDULE 4-2 Series 6 Bond Documents [see attached]

  • Page 269
    SCHEDULE 4-3 Series 8 Bond Documents [see attached]

  • Page 270
    SCHEDULE 4-4 Transaction Documents [see attached]

  • Page 271
    SCHEDULE 6-1 Approved Phase I IAT Project Contract Documents NONE

  • Page 272
    SCHEDULE 6-2 Phase I IAT Project Contract Documents Pending Approval [see attached]

  • Page 273
    SCHEDULE 6-3 Standard Draw Documentation [see attached]

  • Page 274
    SCHEDULE 6-4 Phase I IAT Project Management Structure [see attached]

  • Page 275
    SCHEDULE 7-1 Pre-DBO Rent (with per gate increases) [see attached]

  • Page 276
    SCHEDULE 7-2 RESERVED

  • Page 277
    SCHEDULE 7-3(a) Post-DBO Rent [see attached]

  • Page 278
    SCHEDULE 7-3(b) Terminal 4 Gate Use Fee/Terminal 4 Hardstand Use Fee [see attached]

  • Page 279
    SCHEDULE 7-4 Adjusted Terminal Management Fees [see attached]

  • Page 280
    SCHEDULE 8-1 Port Authority Rules and Regulations [see attached]

  • Page 281
    SCHEDULE 8-2 Terminal 4 Rules and Regulations [see attached]

  • Page 282
    SCHEDULE 8-3 Terminal 3 Parking Fee [see attached]

  • Page 283
    SCHEDULE 10-1 Committee Representatives [see attached]

  • Page 284
    SCHEDULE 10-2 Pro Forma Budget [see attached]

  • Page 285
    SCHEDULE 36-1 Agreements Surviving Execution of this Agreement NONE

  • Page 286
    Exhibit A-1 Pre-DBO Premises; Location of Delta Premises; Concession Space; Concourse A; Delta Hardstand Positions Is a DRAWING

  • Page 287
    Exhibit A-2 Location of Perimeter Dig Area; FIS Facility; Terminal 2-4 Connector Area Is a DRAWING

  • Page 288
    Exhibit A-2-1 Triangle Plume Is a DRAWING

  • Page 289
    Exhibit B Master Plan Is a DRAWING

  • Page 290
    Curbside / Exterior Exterior Delta Branded sign on new curbside "V" column similar to new curbside check-in canopy structure Curbside Check-In Delta branded millwork & signage at new curbside check-in area and canopy structure ATA Lease Exhibit C November 23rd, 2010 1

  • Page 291
    Delta Check-In Check-In Rows 1 & 2 Delta branded millwork at check-in positions & freestanding kiosk Overhead suspended Lobby Information Display monitors and graphics behind check-in positions ATA Lease Exhibit C November 23rd, 2010 2

  • Page 292
    Sky Priority Check-In Sky Priority Check-In Delta branded millwork, backwall & graphics at Sky Priority check-in area ATA Lease Exhibit C November 23rd, 2010 3

  • Page 293
    Gate Holdroom Typical Holdroom Delta branded millwork at gate counter & backwall; wall graphics; suspended Gate Information Display monitors Wall graphics subject to coordination with advertising program ATA Lease Exhibit C November 23rd, 2010 4

  • Page 294
    Delta Sky Club Entrance Concourse level entry to Sky Club Sky Club branded signage on concourse and within lobby visible from concourse ATA Lease Exhibit C November 23rd, 2010 5

  • Page 295
    ASSIGNMENT OF CONSTRUCTION CONTRACTS, PLANS AND SPECIFICATIONS, AND SERVICE AND OTHER CONTRACTS by DELTA AIR LINES, INC., a Delaware corporation, as assignor to JFK INTERNATIONAL AIR TERMINAL LLC, a New York limited liability company, as assignee Dated as of [November] __, 2010 Record and Return to:

  • Page 296
    ... T H: WHEREAS, Assignee has developed and operates an air passenger terminal facility on certain premises located at John F. Kennedy International Airport, Jamaica, New York and more particularly described on Exhibit A attached hereto (the "Premises"), pursuant to a lease made effective as of May 13...

  • Page 297
    ... in connection with the ATA, including the 2010 Expansion Project. "Other Contracts" means each and every contract, agreement or license now or hereafter in effect which affects or relates to the development, use, occupancy, operation, management, ownership, demolition, maintenance or control of the...

  • Page 298
    ..., operation and management of the ATA Premises or the 2010 Expansion Project, other than the Construction Agreements, the Plans and Specifications, Service Agreements and the Permits. "Permits" means all building permits, environmental permits, governmental permits, utility permits, land-use permits...

  • Page 299
    ... Premises or the 2010 Expansion Project (items (a) through (f) being herein collectively referred to as the...agreement, condition and covenant to be performed on its part under each of the Assigned Rights; (b) Promptly forward copies to the Assignee, but in any event not later than five (5) business...

  • Page 300
    ...interest rate provided for in Section 7.07 of the ATA (the "Default Rate") from the date so incurred, until paid. 7. Default by Assignor. Upon and at any time after an Event of Default, and regardless of the adequacy of the security for the Obligations, the authority of the Assignor to perform under...

  • Page 301
    ... or corporation in or about the ATA Premises or the 2010 Expansion Project, except for any claims, injury or damages arising out of or resulting from any gross negligence, willful misconduct or bad faith of the Assignee. (b) At any time after the occurrence and during the continuance of an Event of...

  • Page 302
    ... any of its rights and remedies under law or equity or under the ATA or this Assignment, or any of the Obligations, or under the laws of the state in which the ATA Premises is located. 11. No Merger. So long as any of the Obligations secured hereby shall remain unpaid or unsatisfied, unless the...

  • Page 303
    ... such address by registered or certified mail, postage prepaid. The Assignor shall from time to time designate, in writing, any office within the Port of New York District and an officer or representative whose regular place of business is at such office upon whom notices and requests may be served...

  • Page 304
    ...(x) Commissioner, director, employee, committee member, manager, managing director, officer, agent, representative nor any (y) owner, shareholder, member, partner, controlling Person, principal or ultimate beneficial owner in each case, whether direct or indirect, of the Assignee or any Affiliate of...

  • Page 305
    ... or shall make any claim under or in connection with this Assignment, against (i) any member of the Assignee, or (ii) any of the Affiliates of the Assignee or of any such member, or (iii) any (A) officer, committee member, director, manager, managing director, employee, agent, representative, or...

  • Page 306
    ... and benefit of the Assignor, the Port Authority, the Assignee and the Trustee, and their respective successors and assigns (but in the case of ...the assigns of the Assignor, only to the extent permitted hereunder or thereunder); that no other person or persons shall have any right at any time...

  • Page 307
    IN WITNESS WHEREOF, the parties hereto have caused this Assignment to be executed and delivered as of the day and year first above written. ASSIGNOR: DELTA AIR LINES, INC. By: Name: Title: JFK INTERNATIONAL AIR TERMINAL LLC By: Name: Title:

  • Page 308
    ... known, who, being by me duly sworn, did depose and say that his office is at _____, New York, New York; that he is the _____ of Delta Air Lines, Inc., a company described in and which executed the foregoing Assignment; and that he signed his name thereto by order of the Board of Directors. Notary

  • Page 309
    ... did depose and say that his office is located at _____, New York, New York _____; that, he is the _____ of JFK International Air Terminal LLC, the limited liability company described in and which executed the foregoing Assignment; and that he signed his name thereto by order of its Members. Notary

  • Page 310
    Exhibit B Consent and Agreement

  • Page 311
    EXHIBIT E [FORM OF] CONSENT AND AGREEMENT from [Name of Contractor] to JFK INTERNATIONAL AIR TERMINAL LLC and BANK OF NEW YORK MELLON, As Trustee Dated as of ,

  • Page 312
    ... Party"), to JFK INTERNATIONAL AIR TERMINAL LLC, a New York limited liability company (the "Company") and Bank of New York Mellon, a national banking association, as Trustee (the "Trustee"). RECITALS A. The Contracting Party and Delta Air Lines, Inc., a Delaware corporation ("Delta") have entered...

  • Page 313
    ..., without limitation, all of Delta's rights to receive performance, benefits and all payments (if any) due and to become due to Delta under or with respect to the Assigned Agreement (collectively, the "Assigned Interests"). 1.2 Subsequent Developer. The Contracting Party agrees that, if (i) the...

  • Page 314
    ...Assigned Agreement as required by Section 1.8 of this Consent, and (y) during such time as any Curing Party is pursuing to cure such default or other breach by Delta in accordance with this Section 1.4, the Contracting Party will not exercise any right it may have to terminate or suspend performance...

  • Page 315
    ..., the Trustee (or any Trustee Designee) nor any Subsequent Developer, as applicable, shall be obligated or required to (a) perform any of Delta's obligations under the Assigned Agreement, or (b) take any action to collect or enforce any claim for payment assigned under the Security Agreements. 4

  • Page 316
    ... in the manner and as and when required by the Assigned Agreement to such other person, entity or account as shall be specified from time to time by the Company, the Trustee (or any Trustee Designee) or any Subsequent Developer, as applicable, to the Contracting Party in writing. Nothing in this...

  • Page 317
    ... or under applicable Law, the Contracting Party shall perform its obligations under the Assigned Agreement. 5. Miscellaneous. 5.1 Notices. Any communications between the parties hereto or notices provided herein to be given shall (subject to this Section 5.1) be given to the following addresses: If...

  • Page 318
    ...amends any term or provision of the Assigned Agreement, then, in such instance, this Consent may only be amended by an instrument in writing signed by the Contracting Party, the Company, the Trustee and Delta. 5.6 Successors and Assigns. This Consent shall bind and benefit the Contracting Party, the...

  • Page 319
    (including, without limitation, the Assigned Agreement), the terms, conditions and provisions of this Consent shall prevail. [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK] 8

  • Page 320
    IN WITNESS WHEREOF, the Contracting Party, by its officer duly authorized, intending to be legally bound, has caused this Consent to be duly executed and delivered as of the date first above written. [Name of Contractor] By: Name: Title: CONTRACTOR CONSENT 9

  • Page 321
    ... to an Anchor Tenant Agreement with JFK International Air Terminal LLC ("Company"), dated as of [DATE] (the "Lease"), and that Delta is required by the terms and provisions of the Lease to include certain provisions in all construction and engineering contracts that are executed and delivered in...

  • Page 322
    ...] against Terminal 4, the Airport or the interest of the Company or the Bond Trustee under the [Port/IAT Lease] by reason of any work performed for or materials furnished by [Contracting Party] under this Agreement, it being understood that all work is being performed for the credit of Delta and for...

  • Page 323
    ..., the Port Authority and JFK International Air Terminal LLC, a New York limited liability company ("IAT"), entered into an Agreement of Lease (having Port Authority lease number AYC-685) on May 13, 1997 for the development, construction and operation of a passenger terminal ("Terminal 4") on certain...

  • Page 324
    ... Amended and Restated Quota Share Reinsurance Agreement effective as of January 1, 2009 between MBIA and MBIA Insurance Corp. of Illinois, now known as National Public Finance Guarantee Corporation; and WHEREAS, the payment of Debt Service on the Series 6 Bonds is secured by (i) a Leasehold Mortgage...

  • Page 325
    ...Capitalized Terms. Capitalized terms used herein and not otherwise defined in this Agreement shall have the respective meanings ascribed to them in the Terminal 4 Lease or in the Anchor Tenant Agreement. Subordination. Subject to the terms of this Agreement, the Anchor Tenant Agreement and the terms...

  • Page 326
    ...of the surrender thereof by IAT, whether voluntary, involuntary, or by operation of law, at any time prior to the expiration date of the Anchor Tenant Agreement (collectively with a Foreclosure Action, a "Terminal 4 Lease Termination") where the Trustee (or any successor to the Trustee in connection...

  • Page 327
    ... Operator shall promptly execute and deliver such agreements or other instruments, in recordable form, as may be necessary or appropriate to evidence such non-disturbance. (iv) If the Replacement Operator becomes a Successor Sublessor (as defined in Section 3), it shall be bound by all the terms...

  • Page 328
    ...action nor sent or received any notice to terminate the Anchor Tenant Agreement. The Trustee has not commenced any action or sent or received any notice for the termination of the Terminal 4 Project Bond Documents to which it is a party or the Terminal 4 Lease. Consents. Delta understands and agrees...

  • Page 329
    ...days after the end of the IAT Cure Period, Delta agrees that it shall accept such performance by the Trustee (or any Replacement Operator) or the Bond Insurer of any covenant, condition or agreement on IAT's part to be performed under the Anchor Tenant Agreement in order to cure the Event of Default...

  • Page 330
    ... with the terms of Section 80 of the Terminal 4 Lease or, in the case of the Trustee, Section 23 of the Indenture. Any notice, if given to Delta, must be addressed as follows: Delta Air Lines, Inc. Corporate Real Estate, Dept. 877 1030 Delta Boulevard Atlanta, Georgia 30354 Attention: Vice President...

  • Page 331
    ... Insurer, must be addressed as follows: MBIA Insurance Corporation c/o National Public Finance Guarantee Corporation 113 King Street Armonk, NY 10504 Attention: Insured Portfolio Surveillance Fax: (914) 765-3799 15. Successors and Assigns. This Agreement will be binding upon and inure to the benefit...

  • Page 332
    IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first written above. DELTA AIR LINES, INC. By: Name: Title: THE BANK OF NEW YORK MELLON, Trustee By: Name: Title: Acknowledged and Agreed: JFK International Air Terminal LLC By: Name: Title:

  • Page 333
    ...Scheduled Aircraft Operators (other than ATA Airline Sublessees) for use of Delta Gates and Delta Hardstand Positions JOHN F. KENNEDY INTERNATIONAL AIRPORT TERMINAL 4 - LICENSE AGREEMENT JFK International Air Terminal LLC, a New York limited liability company ("JFK IAT"), with an address at Terminal...

  • Page 334
    EFFECTIVE DATE: This Agreement is executed in three original copies. JFK INTERNATIONAL AIR TERMINAL LLC By: Alain Maca President By: Michael E. Sibilia Chief Financial Officer 2 [Airline] By: Name: Title:

  • Page 335
    ... on behalf of JFK IAT and made generally available by JFK IAT to Terminal 4 Air Carriers, and/or, if designated by JFK IAT, the Delta Gates/Hardstands, for the use in enplaning, deplaning and transiting of persons, cargo and baggage, including the common use check-in and ticketing counter space and...

  • Page 336
    ... each case by schedule and not by actual departure and/or arrival time). (b) Airline shall pay any other fees and charges, including the Overtime Gate Parking Fee, which applies in the event Airline's aircraft remains parked at a gate beyond the time allocated to that aircraft, the Common Use Check...

  • Page 337
    ... flight departing from or arriving at Terminal 4. JFK IAT represents and warrants that it shall use any Passenger Manifest for verification of passenger counts only and shall otherwise keep any information provided therein confidential. Airline shall maintain in accordance with accepted accounting...

  • Page 338
    ... JFK IAT requires Airline to pre-pay any (estimated) fee or other payment required by this Agreement consistent with any JFK IAT credit policy adopted by JFK IAT from time to time. Except for security deposits and any other amounts deposited with JFK IAT in connection with the payment of insurance...

  • Page 339
    .... By executing this Agreement and as a condition to its effectiveness, Airline hereby agrees to pay on demand to the Terminal 4 Airline Consortium ("TFAC") for carriers operating at Terminal 4 its share (as allocated by the association) of the direct and indirect costs incurred by TFAC for providing...

  • Page 340
    ... with Laws. (a) General: In connection with the use of the Terminal 4 Facilities, or the exercise of its rights under this Agreement, Airline (including its officers, employees and agents) shall comply with all applicable laws, codes, regulations, ordinances, rules and orders of federal, state...

  • Page 341
    ...JFK International Air Terminal LLC, its members, the Port Authority, the City of New York, JFK IAT Member LLC, Schiphol USA Inc., and Delta Air Lines, Inc. as additional insureds and shall provide that such policies may not be materially changed, altered, or canceled by the insurer during their term...

  • Page 342
    ...and pledge certain revenues and receipts under this Agreement. 12.3 JFK IAT's Dealings with the Port Authority, the City of New York and Delta. Airline acknowledges that JFK IAT leases Terminal 4 from the Port Authority which in turn leases the Airport from the City of New York, and that JFK IAT has...

  • Page 343
    ...remedies given in this Agreement, may, upon 3 days notice to Airline, (i) suspend services to Airline, including gate access, (ii) require prior payment of applicable fees upon arrival or prior to departure or (iii) exercise any remedy provided by law or in equity. The exercise by JFK IAT of any one...

  • Page 344
    ...necessary or desirable to secure and provide for the payment of Special Revenue Bonds, including the creation of reserves therefor. (d) ATA: This Agreement shall be and remain subordinate to the provisions of the ATA between JFK IAT and Delta with respect to the Delta Gates/ Hardstands. 14.6 Notices...

  • Page 345
    ...or execution of a new lease for Terminal 4, or (b) the Port Authority, at the Port Authority's option, under other circumstances, for the balance of the unexpired term of this Agreement. 14.14 Port Authority Fees. Airline shall be prohibited from performing an activity or services at the Airport for...

  • Page 346
    EXHIBIT A Passenger Fees License Agreement 14

  • Page 347
    ... (10%) or more interest in, Airline: (1) has ever used a name, trade name or abbreviated name or federal taxpayer identification number other than the ones reported to the Lessee in connection with the Sublease; (2) has ever been party to an agreement which was terminated by the Port Authority, for...

  • Page 348
    ... the amount of such payment to account number 291545 for the account of JFK International Air Terminal LLC, JFK IAT Revenue Fund, Attention: Controller. The term "Business Day" shall mean a day on which commercial banks are not authorized or required to close in New York City. 5. This Standby Letter...

  • Page 349
    EXHIBIT K Exhibit 1 [Date] [L/C Bank] [Address] Reference is made to the irrevocable Standby Letter of credit no. _____ dated _____ which has been established by you in favor of JFK International Air Terminal LLC. The undersigned, the beneficiary of and account party, respectively, under the said ...

  • Page 350
    ... 2010 ("Anchor Tenant Agreement") between the Beneficiary and the Account Party. or [b] Both (a) the date of this demand for payment and certificate is not earlier than 60 days prior to the Expiration Date (as defined in clause (iii) of Section 3 of said Standby Letter of Credit) and Delta Air Lines...

  • Page 351
    ... expenses) paid to or for employees employed for the benefit of Project Operations. As used in this paragraph (a): (i) "Fringe benefits" shall mean the items of cost which the Lessee is obligated to payor incur pursuant to applicable collective bargaining agreements or which the Lessee otherwise...

  • Page 352
    ... to trade publications, over-time meals or transportation, uniforms, business travel expenses, pension plans, welfare and training funds, and health, life, accident, or other such types of insurance; and (4) any other payment made or cost incurred by agreement with such employees and personnel...

  • Page 353
    ..., without limitation, excise taxes, New York City sales and use tax and taxes on utilities or on the provision of utility services but excluding New York State Corporation Franchise tax, New York City General Corporation tax and New York City Unincorporated Business tax. (1) Costs and fees incurred...

  • Page 354
    ... in the conduct of or relating to the operation of a first-class international airline terminal. Each of the items of cost enumerated in this Exhibit above shall be treated as a current expense. In no event shall any cost or expenditure be included in Permitted O&M Expenses more than once even...

  • Page 355
    ... are included in Gross Revenues. (h) Any payment, fee, disbursement or other cost, or part thereof, to any third party contractor, agent, supplier, or other party whatsoever, that is above the fair market value under the circumstances for the good or service that is being provided except to the...

  • Page 356
    SCHEDULE 4-1 Port/IAT Lease 1. Agreement of Lease between The Port Authority of New York and New Jersey (the "Port Authority") and JFK International Air Terminal LLC, a New York limited liability company ("JFK IAT"), dated as of May 13, 1997, bearing Port Authority agreement number AYC-685 2. ...

  • Page 357
    ..., (j) Assignment of Construction Contracts, Plans and Specifications, and Service and Other Contracts, (k) Assignment of Tenant Leases and Rents, (l) Port Authority Financing Consent and Agreement, (m) Lease Assignment, and (n) Any other Security Document defined as such in the Lease relating to the...

  • Page 358
    ..., (j) 2010 Assignment of Construction Contracts, Plans and Specifications, and Service and Other Contracts, (k) Assignment of Tenant Leases and Rents, (l) Port Authority Financing Consent and Agreement, (m) Any Parity Resolution, (n) Lease Assignment, and (o) Any other Security Document defined as...

  • Page 359
    SCHEDULE 4-4 Transaction Documents Assignment of Construction Contracts, Plans and Specifications, and Service and Other Contracts, dated as of December 9, 2010, between Delta Airlines, Inc., a Delaware corporation, as assignor, and JFK International Air Terminal LLC, a New York limited liability ...

  • Page 360
    SCHEDULE 6-1 Approved Phase I IAT Project Contract Documents NONE

  • Page 361
    Schedule 6-2 Phase I IAT Project Contract Documents Pending Approval

  • Page 362
    SCHEDULE 6-3 TO THE ANCHOR TENANT AGREEMENT, STANDARD DRAW DOCUMENT [Date] JFK International Air Terminal LLC [Address] Draw Document Number [ ] This Standard Draw Document is delivered pursuant to Section 6.01(f) of the Anchor Tenant Agreement, dated as of _____, 2010, between JFK International Air...

  • Page 363
    ... a 2010 Expansion Project Cost and is a proper charge against the Series 8 Account in the Construction Fund; (ii) Schedule 1 to this Standard Draw Document describes in reasonable detail, except in the case of a Series 8 Debt Service Requisition, the purpose for which the obligation to pay (or...

  • Page 364
    Schedule 1 Standard Draw Document Number [ Address/ Wiring Instructions ] Element of the 2010 Expansion Project Name of Payee Amount to be Paid Purpose 3

  • Page 365
    Schedule 2 Standard Draw Document Number [ ] Set forth below is a summary of payments and expenditures for 2010 Expansion Project Costs from the Series 8 Bond Proceeds as of the date of this Standard Draw Document: Costs Previously Paid and/or Requisitioned Costs Included in This Standard Draw ...

  • Page 366
    ... Support D. Brown, PE - AECOM M. Chalmers, RA - AECOM Design Manager K. Seabolt KDS Architecture On-site Design Coordination BHS JFKIAT Finance M. Sibilia R. van Veen Delta Bond Trustee Executive Committee Alain Maca - JFKIAT John Boatright - Delta Internal Auditor SCHEDULE 6-4 Phase I IAT Project...

  • Page 367
    ...) equal monthly installments, which shall be increased as of the first day of each calendar year by an amount equal to (x) the then existing rate multiplied by (y) the Annual Percentage Increase. 3) Delta Support Space Location Numbers 172.004, 172.006, 172.010, 272.054, 272.076, 272.030 and 114.106...

  • Page 368
    ... first day of each calendar year by an amount equal to (x) the then existing rate multiplied by (y) the Annual Percentage Increase For purposes of this Schedule 7-1 only, "Annual Percentage Increase" means the percentage increase, as set forth below: 2011 - 2.5% 2012 - 2.5% 2013 - 2.0% 2014 - 2.0% 2

  • Page 369
    ... 7-3. All tables provided herein are to illustrate the rent calculation methodology and actual rents will change from year to year based on actual costs, occupancy, and utilization by both Contract Carriers and Delta. Capitalized terms used but not defined in the body of the Agreement shall have the...

  • Page 370
    ..., or (y) the Percentage Methodology established pursuant to Section VI below; provided that, if at any time the Delta Premises includes sixteen (16) Delta Gates located in Original Terminal 4, then (i) for each Annual Period (or portion thereof) Delta shall receive a credit against the Post-DBO Rent...

  • Page 371
    ... any allocation to Delta of Series 6 First Additional Land Rental (as such term is defined in the Port/IAT Lease) and shall be included in Post-DBO Rent through December 1, 2025. "Series 8 Bonds Debt Service" shall mean the actual annual principal, interest and other scheduled annual payments to be...

  • Page 372
    ... the Airfield Cost Center would include, among other items, ramp repair, ramp striping, ramp security, snow removal, fod removal, and other expenses of a similar nature customarily allocated to operation and maintenance of an airport ramp position). As of the date of this Agreement, the percentages...

  • Page 373
    ... • Remote Aircraft Parking Positions with Fuel Pits. • Remote Aircraft Parking Positions - Group V. • Remote Aircraft Parking Positions - Group IV. The number and type of parking positions referred to above (collectively referred to as the "Aircraft Parking Positions") may change over time. As...

  • Page 374
    ... Sub-Cost Center Requirement" and the "Cost Per Aircraft Parking Position". TABLE B Allocation of Airfield Cost to Original Terminal 4 Gates 3 Allocation Percentage Costs per Parking Position 4 Total Allocation Percentage by Sub-Cost Center Column Airfield Sub-Cost Center 1 Current Number of...

  • Page 375
    ... Additional Land Rental Charge and Lessee Terminal Management Funds shall be allocated to all of the Airfield Sub-Cost Centers in Table C, except for the Expansion Gate Parking Positions, in accordance with the allocation percentages in column 4 of Table B. The Series 8 Bonds Debt Service and the...

  • Page 376
    ...replacement thereof. The costs calculated pursuant to the allocations in Sections III.B.1-4 above shall be summed by Airfield Sub-Cost Center, and divided by the number of Aircraft Parking Positions in each Sub-Cost Center, to determine the Rental Rate Per Aircraft Parking Position as illustrated in...

  • Page 377
    ... Fuel Pits 4 Remote Aircraft Parking Positions Group V 5 Remote Aircraft Parking Positions Group IV Column 6 Total Ground Rental Capital Charge Additional Capital Charge Lessee Terminal Management Funds Series 6 First Additional Land Rental ATA Direct O&M Expenses ATA Indirect O&M Expenses Debt...

  • Page 378
    ... above shall be further allocated to the Terminal Sub-Cost Centers as provided below. 1. Ground Rental shall be allocated to all Terminal Sub-Cost Centers based on the following fixed percentages in column 2 of Table D, which are derived from the respective number of acres occupied by the footprint...

  • Page 379
    ... the consent of Delta or a Delta Affiliate Carrier using the Delta Space, and that exclusively benefits (a) Delta or one or more Delta Affiliate Carriers; and/or (b) the Delta Space and/or (c ) areas of Terminal 4 that only serve the Delta Space or Delta's operations in the Delta Premises shall be...

  • Page 380
    ... a Delta Affiliate Carrier and "non-Delta Flights" means all other flights operating at Terminal 4. "Delta Passengers" means passengers of Delta or a Delta Affiliate Carrier. "International Arrival Passenger" means a passenger arriving at Terminal 4 who is considered by the United States Customs and...

  • Page 381
    ... A Ground Rental Capital Charge Additional Capital Charge Lessee Terminal Management Funds Series 6 First Additional Land Rental Debt Service on Series 8 Bonds Series 8 First Additional Land Rental ATA Direct O&M Expenses ATA Indirect O&M Expenses Total Sub-Cost Center Requirement 1,670,378...

  • Page 382
    ... Original Headhouse Phase I Phase I Headhouse Original Concourse B Concourse B Total (for Improvements Concourse A Concourse B Bus Gate Expansion verification) (Divided by) Usable Area1 Cost Per ft2 of Usable Area Series 8 & FALR Cost Per ft2 of Usable Area ATA Permitted O&M Expenses Per ft2 of...

  • Page 383
    TABLE G Square footage of Usable Area by Functional Areas within the Terminal Sub-Cost Centers (Each Functional Area is defined below based on the respective areas identified as such on Annex 7-3, page 16) Column Functional Area 1 Original Headhouse 2 Phase I Headhouse Improvements 3 Concourse A 4 ...

  • Page 384
    ...Preferential IAT Space - Exclusive/Preferential Customs/FIS Space (Headhouse) Customs/Sterile Area (Concourse) Domestic Baggage Claim Space Capital Domestic Baggage Claim Space O&M Baggage Recheck Space Checked Baggage Screening Space Total Terminal Sub-Cost Center Requirement: 4,184,287 33,960...

  • Page 385
    ... I Delta Share of Terminal Functional Area Requirement for each Terminal Functional Area Functional Area Allocation Methodology Estimated Delta Allocation Delta Space - Exclusive/ Preferential Customs/FIS Space (Headhouse) Actual Square Feet Actual Square Feet International Arriving Passengers in...

  • Page 386
    ... Space shall be a pro rata share of the Checked Baggage Screening Space Functional Area Requirement for the applicable period, based upon the ratio for the applicable period of the number of bags inducted into the Baggage System from the Terminal 4 ticket lobby for Delta Flights to the total -18-

  • Page 387
    ...bags inducted into the Baggage System from the Terminal 4 ticket lobby for the applicable period. C. Delta Additional Rents and Credits Adjusted Terminal Management Fee (100% allocated to Delta without regard to space occupied by Delta at Terminal 4) shall be payable in equal monthly payments based...

  • Page 388
    D. Delta Total Rent: Based on the above cost center allocations and functional area allocations based on occupancy/usage, the Total Post-DBO Rent would be calculated as follows: Table J Total Delta Post-DBO Rent Cost Center/Sub-Cost Center Delta Allocated Share Airfield Original Headhouse Expansion...

  • Page 389
    ... Debt Service on the Series 8 Bonds and the Series 8 First Additional Land Rental. Calculate the component of Post-DBO Rent allocable to the Original Terminal 4 Airfield Costs as shown in Table K-1 below. TABLE K-1 Delta Share of Original Terminal 4 Airfield Costs Cost Per Aircraft Parking Position...

  • Page 390
    ... Original Terminal 4. TABLE K-2 Delta Share of Original Headhouse Sub-Cost Center Requirement Sub-Cost Center Requirement From Table H Functional Area Delta Share Delta Rent Delta Space - Exclusive/Preferential Customs/FIS Space (Headhouse) Customs/Sterile Area (Concourse) Domestic Baggage Claim...

  • Page 391
    ...Delta Share of Original Concourse B Sub-Cost Center Requirement Sub-Cost Center Requirement From Table H Functional Area Delta Share Delta Rent Exclusive/Preferential Customs/FIS Space (Headhouse) Customs/Sterile Area (Concourse) Domestic Baggage Claim Space Baggage Recheck Space Checked Baggage...

  • Page 392
    ...Delta Share of Concourse B Bus Gate Sub-Cost Center Requirement Sub-Cost Center Requirement From Table H Functional Area Delta Share Delta Rent Exclusive/Preferential Customs/FIS Space (Headhouse) Customs/Sterile Area (Concourse) Domestic Baggage Claim Space Baggage Recheck Space Checked Baggage...

  • Page 393
    ... Percentage (calculated in Table K-6 above) to Table L below. TABLE L Number of Delta Gates located in Original Terminal 4 Delta's Share of Original Terminal 4 Requirement 7 8 9 10 11 12 13 14 15 16 40.0% 46.7% 53.3% 60.0% 66.7% 73.3% 80.0% 86.7% 93.3% 100.0% G. When the Percentage Methodology...

  • Page 394
    ... of the Terminal 4 Gate Use Fee and the Terminal 4 Hardstand Use Fee as defined in this Schedule 7-3(b) make reference to certain information, tables, and definitions set forth in Schedule 7-3(a) (Calculation and Payment of Post-DBO Delta Rent) which are based on current estimates available to the...

  • Page 395
    ... established by dividing the Daily Gate Cost Allocation by the Average Turn Number. C. Where applicable, the Terminal 4 Gate Use Fee will be paid or credited, as the case may be, for each Turn. A "Turn" means the arrival and departure of an aircraft, excluding returns to ramp not involving a change...

  • Page 396
    C. The "Terminal 4 Hardstand Use Fee" will be determined by multiplying the Hourly Hardstand Cost Allocation by the number of hours (counting any partial hour as a complete hour) of each use of a Hardstand Position subject to the Terminal 4 Hardstand Use Fee pursuant to the terms of the Agreement. 3

  • Page 397
    .... "JFK IAT Effective Date" means the "Effective Date" as such term is defined in the JFK IAT Member LLC Agreement. "JFK Passengers" means, for any Semi-Annual Period, the "JFK Total Passengers" including revenue, non-revenue, international and domestic passengers, shown in the Annual Traffic Report...

  • Page 398
    ...to the Base Fee pursuant to the Port/IAT Lease. (ii) Terminal 4 Square Footage Adjustment. (A) Effective on the first day of the first Alternative Annual Period commencing on or after Phase I DBO, the Adjusted Terminal Management Fee with respect to the Semi-Annual Period commencing on such date (as...

  • Page 399
    ... Change occurs and the applicable Adjustment Date for such change, in each case relative to a one hundred eighty (180) day period; provided, however, that for purposes of determining the Adjusted Terminal Management Fee with respect to the Semi-Annual Period immediately succeeding the Semi-Annual...

  • Page 400
    ... is the total number of JFK Passengers during the Alternative Annual Period immediately preceding the Latest Year. (v) Partial Semi-Annual Periods. If IAT is dissolved or liquidated pursuant to Article VII of the JFK IAT Member LLC Agreement or otherwise, the Adjusted Terminal Management Fee for...

  • Page 401
    ... held on July 26, 2007, and amended at a meeting of that body on May 22, 2008. Issued by The Port Authority of New York & New Jersey - Aviation Department. Together with such Airport bulletins issued from time to time by the Managers as necessary to amend the Port Authority Rules and Regulations.

  • Page 402
    SCHEDULE 8-2 Terminal 4 Rules and Regulations 1. JFK INTERNATIONAL AIR TERMINAL, LLC TERMINAL 4 - AIRSIDE OPERATIONS GUIDE 2. JFK INTERNATIONAL AIR TERMINAL, LLC TERMINAL 4 OPERATIONS MANUAL Effective as of April 2006 Including: Attachment 1: Solicitation Attachment 2: Quality and Customer Service ...

  • Page 403
    SCHEDULE 8-3 Terminal 3 Parking Fees Capitalized terms used but not defined in the body of the Agreement shall have the meanings assigned to such terms in this Schedule 8-3. The "Terminal 3 Parking Fee" shall be determined by multiplying the amount of time a Contract Carrier or Other JFK Carrier is ...

  • Page 404
    ... that would have been accrued and paid at the First Deferred Area IB Ground Rental Rate (as defined in the Port/Delta Lease) had the Terminal 3 Site Surrender Date (as defined in the Port/Delta Lease) occurred by the end of the twenty-fourth (24th) month from and including the month in which the...

  • Page 405
    EXHIBIT A to Schedule 8-3 Terminal 3 Hardstand Parking Position Rental Calculation [see attached] Exh. A to Sch. 8-3

  • Page 406
    ... Rental rate is based on current AYC-325 rate through 2017. Terminal 3 Ground Rent assumed deferred from 5/1/2013 through 5/1/2015. Terminal 3 Deferred Ground Rent is amortized at the long bond rate through 2020. Based on Delta equity investment at Terminal 3 site amortized for 10 years at 6% (long...

  • Page 407
    ... Representatives Trilateral Committee • Delta Corporate Real Estate Vice President • SUSA Inc. President • President Management Committee • President • Delta Director Corporate Real Estate Operations Advisory Committee • Delta Vice President - Airport Customer Service JFK • IAT COO...

  • Page 408
    ... Total Airline Revenue Retail Revenue Other Income Total Income Expenses: Personnel Maintenance Outsourced Labor Utilities General & Administrative Ground Rent Total Operating Expenses Net Operating Income Facility Rent Net Income Before Interest Interest Income Net Income Prior to Reserves Payments...

  • Page 409
    SCHEDULE 36-1 Agreements Surviving Execution of this Agreement [NONE]

  • Page 410
    ...-Term Incentive Program (the "2011 LTIP") is a long term incentive program sponsored by Delta Air Lines, Inc. ("Delta" or the "Company") that is intended to closely: (a) link pay and performance by providing management employees with a compensation opportunity based on Delta's achieving key business...

  • Page 411
    ... Employment. Subject to the terms of the 2007 Performance Plan and the 2011 LTIP, the Restrictions shall lapse and be of no further force or effect with respect to one-half of the Shares of Restricted Stock on February 1, 2012 ("First Installment Date") and the remaining one-half on February 1, 2013...

  • Page 412
    ...is employed by an Affiliate at the time the Company sells or otherwise divests itself of such Affiliate) on or after a Change in Control but prior to the second anniversary of such Change in Control, any Restrictions in effect shall immediately lapse on the date of such Termination of Employment and...

  • Page 413
    ... any, of a Performance Award will be made (A) in Shares, calculated based on the Conversion Formula (as defined below), to each Participant who is employed by the Company as an executive vice president or more senior officer or holds the position of general counsel or chief financial officer of the...

  • Page 414
    ... amount of the payout for the Performance Award if it is paid in cash; and B = the closing price of a Share on the New York Stock Exchange on the later of (1) date that the Committee approves the payouts, if any, of the Performance Awards to the Executive Officer Participants following the Committee...

  • Page 415
    ... Net Debt. (4) (5) "Market Value of Equity" means the total number of Shares of Common Stock outstanding on December 31, 2010 multiplied by $12.60 (the closing price of a Share of Common Stock on the New York Stock Exchange on that date), which value shall remain constant during the Performance...

  • Page 416
    ... internal financial statements using the following formula (A+B-C), subject to Section 4(b)(v)(B), where: A = Total gross long term debt and capital leases (including current maturities) that reflects Delta's actual obligations to lenders or lessors, including any adjustments from the book value...

  • Page 417
    ... Group and any other airline, including another member of the Industry Composite Group (an "Airline Merger"), Cumulative Revenue Growth for the surviving company will be calculated on a combined basis as if the Airline Merger had occurred on January 1, 2010 and Average Annual Operating Income...

  • Page 418
    ... the end of 2012, in which case such payment shall be made as soon as administratively practicable after March 15, 2013. (vii) Accelerated Vesting/Forfeiture upon Termination of Employment. The Performance Awards are subject to the following terms and conditions. (A) Without Cause or For Good Reason...

  • Page 419
    ... for Good Reason or Retirement) prior to the end of the workday on December 31, 2013, the Participant will immediately forfeit any unpaid portion of the Performance Award as of the date of such Termination of Employment. In the event that a Participant incurs a Termination of Employment by reason...

  • Page 420
    ... receive Restricted Stock Units as specified in the Participant's Award Agreement (the "RSU"). (ii) Grant Date. The Grant Date of the RSUs will be determined in accordance with the Company's Equity Award Grant Policy, as in effect from time to time, and set forth in the Participant's Award Agreement...

  • Page 421
    ... with any payment or consideration in the nature of value or compensation to or for the Participant's benefit under any other agreement with or plan of Delta, shall be subject to reduction as set forth in Section 4(e) of the 2009 Delta Air Lines, Inc. Officer and Director Severance Plan, which...

  • Page 422
    ...: (i) any long-term award made to a Participant under the 2007 Performance Plan, (ii) any other equity-based awards or other incentive compensation awards made to a Participant by any of Delta (or any Affiliate or former Affiliate), (iii) any retention payment or special travel benefits provided to...

  • Page 423
    ... operations, marketing plans and strategies, alliance agreements and relationships, its compensation and incentive programs for employees, and the business methods used by Delta and its employees, and other information which derives economic value, actual or potential, from not being generally...

  • Page 424
    ...all alliance agreements, plans and processes; all plans, strategies, and agreements related to the sale of assets; all third party provider agreements, relationships, and strategies; all business methods and processes used by Delta and its employees; all personally identifiable information regarding...

  • Page 425
    ..., reports, personnel information (including benefit files, training records, customer lists, operating procedure manuals, safety manuals, financial statements, price lists and the like), relating to the business of Delta, with which you come in contact in the course of your employment (hereinafter...

  • Page 426
    ...-Vice President-Compensation, Benefits and Services Delta Air Lines, Inc. (b) Injunctive Relief in Aid of Arbitration; Forum Selection. You hereby acknowledge and agree that the provisions contained in Section 2 of this Agreement are reasonably necessary to protect the legitimate business interests...

  • Page 427
    ... provision set forth in Section 2(g) of this Agreement to the extent required to be in compliance with any applicable law or regulation or Delta's internal clawback policy, as it may be amended from time to time. 7. Acknowledgement. By signing this Agreement: (a) you acknowledge that you have had...

  • Page 428
    ...the 2011 LTIP. You and Delta, each intending to be bound legally, agree to the matters set forth above by signing this Agreement, all as of the date set forth below. DELTA AIR LINES, INC. By: Name: Robert L. Kight Title: Vice President Compensation, Benefits and Services PARTICIPANT [NAME] Date: -6-

  • Page 429
    ... Management Incentive Plan (the "MIP") is an annual incentive program sponsored by Delta Air Lines, Inc. ("Delta" or the "Company") that is intended to closely: (a) link pay and performance by providing management employees with a compensation opportunity based on Delta's achieving key business plan...

  • Page 430
    ... who is employed by the Company as an executive vice president or more senior officer or holds the position of general counsel or chief financial officer of the Company ("Executive Officer Participant"), as discussed in Section 7(b) below. (b) Performance Measures. The performance measures used will...

  • Page 431
    ... Financial, Operational, Customer Service, Leadership Effectiveness, and Individual Performance, are based on the achievement of the target performance level with respect to each applicable performance measure (except that Financial Performance also requires a payout under the Profit Sharing Program...

  • Page 432
    ... pre-tax income calculated in accordance with Generally Accepted Accounting Principles in the United States and as reported in the Company's public securities filings but excluding: (a) all asset write downs related to long term assets, (b) gains or losses with respect to employee equity securities...

  • Page 433
    .... (c) Customer Service Performance Measures. The Customer Service Performance measures for 2011 will be measured based on the percentage point increase in Delta's annual Net Promoter Score ("NPS") from the 2010 calendar year to the 2011 calendar year, with (i) Delta's NPS performance attributable to...

  • Page 434
    ... of the required Financial Performance, Operational Performance and Customer Service Performance results and (ii) where applicable, Leadership Effectiveness Performance results have been determined and an LPM evaluation has been completed, but in no event later than March 15, 2012, unless it...

  • Page 435
    ... cash; and B = the closing price of a Share on the New York Stock Exchange on the later of (1) the date that the Committee approves the payouts, if any, to the Executive Officer Participants under the MIP following the Committee's certification of the achievement of the required performance measures...

  • Page 436
    ...to the terms of the 2007 Plan. In the event any Executive Officer Participant's MIP Award is converted to MIP Restricted Stock, such Participant will receive a written notice of such conversion with the details thereof as soon as practicable after the MIP Payment Date. 8. Change in Employment Status...

  • Page 437
    ... a Termination of Employment by the Company without Cause, or (2) for any other reason that entitles such Participant to benefits under the Delta Air Lines, Inc. 2009 Officer and Director Severance Plan (the "Severance Plan"). Subject to the Participant's execution of a waiver and release of claims...

  • Page 438
    ... year in which the Termination of Employment occurs. "Pro Rata MIP Payment" means the result of the following formula: W Ã- Z/12, where: W = the Participant's Target MIP Award; and Z = the number of calendar months the Participant was actively employed by Delta during 2011 in a MIP-eligible position...

  • Page 439
    ... she provides appropriate evidence that he or she is entitled to an exception to the five-year limit on uniformed service as set forth in USERRA. 9. Treatment of Payments Under Benefit Plans or Programs. MIP payments, which for an Executive Officer Participant who receives MIP Restricted Stock means...

  • Page 440
    ... internal clawback policy, as it may be amended from time to time, if the Committee determines that a vice president or more senior officer level Participant has engaged in fraud or misconduct that caused, in whole or in part, the need for a required restatement of Delta's financial statements filed...

  • Page 441
    ... system on time operations for the month. On time operations are defined as the number of flights that arrive at the scheduled destination within 15 minutes of the scheduled arrival time. Divide the result of D.2 by the result of D.1 for a combined Delta Connection system on-time performance measure...

  • Page 442
    ... of Delta common stock issued prior to the effective date of Delta's emergence from bankruptcy on April 30, 2007; (2) the issuance of new Delta common stock and certain debt securities in accordance with Delta's Joint Plan of Reorganization; and (3) the application of fresh start reporting...

  • Page 443
    ...Delta Air Lines Dublin Limited Delta Air Lines Private Limited Delta Private Jets, Inc. Delta Sky Club, Inc. Epsilon Trading, LLC Kappa Capital Management, LLC MLT Inc. Montana Enterprises, Inc. New Sky, Ltd. Northwest Aerospace Training Corporation Northwest Airlines Charitable Foundation Northwest...

  • Page 444
    ... to Delta Air Lines, Inc. 2007 Performance Compensation Plan, Registration Statement No. 333-151060 on Form S-8 pertaining to Northwest Airlines Corporation 2007 Stock Incentive Plan, and Registration Statement No. 333-167811 on Form S-3 pertaining to Pass Through Certificates; of our reports dated...

  • Page 445
    ...respects the financial condition, results of operations and cash flows of Delta as of, and for, the periods presented in this report; 4. Delta's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15...

  • Page 446
    ...respects the financial condition, results of operations and cash flows of Delta as of, and for, the periods presented in this report; 4. Delta's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15...

  • Page 447
    ...with the filing on the date hereof with the Securities and Exchange Commission of the Annual Report on Form 10-K of Delta Air Lines, Inc. ("Delta") for the fiscal year ended December 31, 2010 (the "Report"). Each of the undersigned, the Chief Executive Officer and the Senior Vice President and Chief...