Delta Airlines 2014 Annual Report Download - page 425

(v) Vesting .
(A) General.
Subject to the terms of the 2007 Performance Plan, the 2015 LTIP, and all other conditions
included in any applicable Award Agreement, the Performance Award shall vest, as described in this Section 4(b)(v), as
of the end of the Performance Period to the extent that the Company’
s actual performance results meet or exceed
Threshold level with respect to Average Annual Operating Income Margin, Customer Service Performance and/or
Return on Invested Capital, as applicable and as described below. For purposes of Average Annual Operating Income
Margin, the Company’s performance is compared against the Composite Performance of the Industry Composite Group.
(B) Committee’s Authority.
In determining the Average Annual Operating Income Margin for Delta and each
member of the Industry Composite Group and the Return on Invested Capital for Delta, the Committee shall make such
adjustments with respect to any subject company as is necessary to ensure the results are comparable, including, without
limitation, differences in accounting policies, practices, guidelines, reclassifications or restatements (for example, fuel
hedging, purchase accounting adjustments associated with mergers, acquisitions or divestures, or fresh start accounting
as a result of emergence from bankruptcy). Without limiting the generality of the forgoing, the Committee shall (i) make
such determinations based on financial data filed by the subject company with the U.S. Department of Transportation or
otherwise and (ii) exclude from any calculation any item of gain, loss, or expense to be extraordinary or unusual in
nature or infrequent in occurrence.
(C) Impact of Certain Events.
A company shall be automatically removed from the Industry Composite Group
in the event that any of the following occur during or with respect to the Performance Period: (i) such company ceases to
maintain or does not timely prepare publicly available statements of operations prepared in accordance with GAAP;
(ii) such company is not the surviving entity in any merger, consolidation, or other non-
bankruptcy reorganization (or
survives only as a subsidiary of an entity other than a previously wholly owned subsidiary of such company); (iii) such
company sells, leases, or exchanges all or substantially all of its assets to any other person or entity (other than a
previously wholly owned subsidiary of such company); (iv) such company is dissolved and liquidated; or (v) more than
20% of such company's revenues (determined on a consolidated basis based on the regularly prepared and publicly
available statements of operations of such company prepared in accordance with GAAP) for any fiscal year of such
company are attributable to the operation of businesses other than such company's airline business and such company
does not provide publicly available statements of operations with respect to its airline business that are separate from the
statements of operations provided with respect to its other businesses.
(D) Transactions Between Airlines.
To the extent reasonably practicable, in the event of a merger,
consolidation, or similar transaction during the Performance Period between Delta and any other airline, including a
member of the Industry Composite Group, or between any member of the Industry Composite Group and any other
airline, including another member of the Industry Composite Group (an “ Airline Merger ”),
Average Annual Operating
Income Margin for any such company involved in an Airline Merger will be calculated on a combined basis as if the
Airline Merger had occurred on January 1, 2015, removing the effects of purchase accounting-
related adjustments.
Furthermore, to the extent reasonably practicable, in the event of an acquisition or divestiture, or similar transaction
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