Delta Airlines 2012 Annual Report Download - page 382

A = The Initial Value;
B = The cumulative amount starting as of January 1, 2013 and ending as of the last day of the
applicable calendar quarter of the Company's pre-
tax income determined in accordance with GAAP,
but (i) excluding: (1) items present in the line item “restructuring and other items”
or such similar line
item; (2) mark-to-
market adjustments for fuel hedges recorded in periods other than the settlement
period; and (3) other special, unusual, or nonrecurring items which are disclosed in publicly available
filings with the SEC and (ii) including expenses due to amortization of post-
employment benefit losses
in AOCI that have occurred during the Performance Period; and
C = in the event that the Company pays a dividend or issues or repurchases additional
Common Stock for cash during the Performance Period (but excluding the exercise of any employee
stock option for cash or any other issuance of Common Stock to employees), (i) the gross cash
proceeds of the equity issuance or (ii) the gross cash payments for the equity repurchase or dividends,
before adjustment for any applicable fees or charges associated therewith.
A = Total gross long term debt and capital leases (including current maturities) that reflect
Delta's actual obligations to lenders or lessors, including any adjustments from the book value to reflect
premiums or discounts that may be amortizing;
B = Annual aircraft rent expense multiplied by seven; and
C = Unrestricted cash, cash equivalents and short-term investments.
(v) Vesting .
(A) General.
Subject to the terms of the 2007 Performance Plan, the 2013 LTIP, and all other conditions
included in any applicable Award Agreement, the
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(4) “Adjusted Book Value of Equity”
for Delta shall be calculated quarterly based on its regularly
prepared internal financial statements (i) with an initial starting value for the quarter ending December
31, 2012 (the “ Initial Value ”) equal
to the book value of equity determined in accordance with
GAAP as of December 31, 2012, but excluding the impact of gains or losses as of December 31, 2012
associated with (1) the cumulative pension and other post-
employment retirement benefits net balance
recorded in AOCI; (2) the derivative contracts and associated items net balance recorded in AOCI; and
(3) the deferred tax asset valuation allowance balance and (ii) using the following formula for each
subsequent quarter thereafter, (A+B+C), where:
(5) “Adjusted Net Debt”
for Delta shall be calculated quarterly based on its regularly prepared internal
financial statements using the following formula (A+B-C), subject to Section 4(b)(v)(B), where: