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R
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
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Or
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o
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
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Large accelerated filer
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R
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Accelerated filer
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o
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Non-accelerated filer
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o
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Smaller reporting company
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o
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(Do not check if a smaller reporting company)
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Page Number
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(in millions, except share data)
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September 30, 2011
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December 31, 2010
|
||||
ASSETS
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|||||||
Current Assets:
|
|
|
|
||||
Cash and cash equivalents
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$
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2,307
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|
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$
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2,892
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Short-term investments
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958
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|
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718
|
|
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Restricted cash, cash equivalents and short-term investments
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405
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409
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|
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Accounts receivable, net of an allowance for uncollectible accounts of $39 and $40
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at September 30, 2011 and December 31, 2010, respectively
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1,816
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1,456
|
|
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Expendable parts and supplies inventories, net of an allowance for obsolescence of $96 and $104
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at September 30, 2011 and December 31, 2010, respectively
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380
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318
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|
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Deferred income taxes, net
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396
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355
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Prepaid expenses and other
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1,067
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1,159
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Total current assets
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7,329
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7,307
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Property and Equipment, Net:
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Property and equipment, net of accumulated depreciation and amortization of $5,172 and $4,164
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|
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at September 30, 2011 and December 31, 2010, respectively
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20,256
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20,307
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Other Assets:
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Goodwill
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9,794
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9,794
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Identifiable intangibles, net of accumulated amortization of $582 and $530
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|
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|
||||
at September 30, 2011 and December 31, 2010, respectively
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4,697
|
|
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4,749
|
|
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Other noncurrent assets
|
960
|
|
|
1,031
|
|
||
Total other assets
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15,451
|
|
|
15,574
|
|
||
Total assets
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$
|
43,036
|
|
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$
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43,188
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LIABILITIES AND STOCKHOLDERS' EQUITY
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|||||||
Current Liabilities:
|
|
|
|
||||
Current maturities of long-term debt and capital leases
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$
|
1,937
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|
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$
|
2,073
|
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Air traffic liability
|
4,072
|
|
|
3,306
|
|
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Accounts payable
|
1,641
|
|
|
1,713
|
|
||
Frequent flyer deferred revenue
|
1,701
|
|
|
1,690
|
|
||
Accrued salaries and related benefits
|
1,203
|
|
|
1,370
|
|
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Taxes payable
|
597
|
|
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579
|
|
||
Other accrued liabilities
|
861
|
|
|
654
|
|
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Total current liabilities
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12,012
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|
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11,385
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|
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Noncurrent Liabilities:
|
|
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Long-term debt and capital leases
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12,557
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|
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13,179
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|
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Pension, postretirement and related benefits
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11,250
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|
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11,493
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|
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Frequent flyer deferred revenue
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2,604
|
|
|
2,777
|
|
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Deferred income taxes, net
|
1,967
|
|
|
1,924
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|
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Other noncurrent liabilities
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1,424
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|
|
1,533
|
|
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Total noncurrent liabilities
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29,802
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|
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30,906
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Commitments and Contingencies
|
|
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Stockholders' Equity:
|
|
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Common stock at $0.0001 par value; 1,500,000,000 shares authorized, 861,436,003 and 847,716,723
|
|
|
|
||||
shares issued at September 30, 2011 and December 31, 2010, respectively
|
—
|
|
|
—
|
|
||
Additional paid-in capital
|
13,983
|
|
|
13,926
|
|
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Accumulated deficit
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(8,823
|
)
|
|
(9,252
|
)
|
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Accumulated other comprehensive loss
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(3,724
|
)
|
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(3,578
|
)
|
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Treasury stock, at cost, 14,291,523 and 12,993,100 shares at September 30, 2011 and
|
|
|
|
||||
December 31, 2010, respectively
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(214
|
)
|
|
(199
|
)
|
||
Total stockholders' equity
|
1,222
|
|
|
897
|
|
||
Total liabilities and stockholders' equity
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$
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43,036
|
|
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$
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43,188
|
|
|
|
|
|
||||
The accompanying notes are an integral part of these Condensed Consolidated Financial Statements.
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Three Months Ended September 30,
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Nine Months Ended September 30,
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||||||||||||
(in millions, except per share data)
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2011
|
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2010
|
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2011
|
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2010
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||||||||
Operating Revenue:
|
|
|
|
|
|
|
|
||||||||
Passenger:
|
|
|
|
|
|
|
|
||||||||
Mainline
|
$
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6,857
|
|
|
$
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6,204
|
|
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$
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18,198
|
|
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$
|
16,170
|
|
Regional carriers
|
1,711
|
|
|
1,571
|
|
|
4,836
|
|
|
4,420
|
|
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Total passenger revenue
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8,568
|
|
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7,775
|
|
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23,034
|
|
|
20,590
|
|
||||
Cargo
|
257
|
|
|
227
|
|
|
771
|
|
|
614
|
|
||||
Other
|
991
|
|
|
948
|
|
|
2,911
|
|
|
2,762
|
|
||||
Total operating revenue
|
9,816
|
|
|
8,950
|
|
|
26,716
|
|
|
23,966
|
|
||||
|
|
|
|
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|
|
|
||||||||
Operating Expense:
|
|
|
|
|
|
|
|
||||||||
Aircraft fuel and related taxes
|
2,881
|
|
|
2,023
|
|
|
7,710
|
|
|
5,666
|
|
||||
Salaries and related costs
|
1,717
|
|
|
1,669
|
|
|
5,183
|
|
|
5,043
|
|
||||
Contract carrier arrangements
|
1,432
|
|
|
1,236
|
|
|
4,142
|
|
|
3,125
|
|
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Aircraft maintenance materials and outside repairs
|
428
|
|
|
405
|
|
|
1,398
|
|
|
1,174
|
|
||||
Passenger commissions and other selling expenses
|
480
|
|
|
404
|
|
|
1,289
|
|
|
1,145
|
|
||||
Contracted services
|
419
|
|
|
398
|
|
|
1,259
|
|
|
1,156
|
|
||||
Depreciation and amortization
|
384
|
|
|
375
|
|
|
1,141
|
|
|
1,139
|
|
||||
Landing fees and other rents
|
342
|
|
|
331
|
|
|
975
|
|
|
968
|
|
||||
Passenger service
|
207
|
|
|
190
|
|
|
552
|
|
|
493
|
|
||||
Aircraft rent
|
72
|
|
|
92
|
|
|
224
|
|
|
305
|
|
||||
Profit sharing
|
167
|
|
|
185
|
|
|
175
|
|
|
275
|
|
||||
Restructuring and other items
|
3
|
|
|
206
|
|
|
154
|
|
|
342
|
|
||||
Other
|
424
|
|
|
433
|
|
|
1,265
|
|
|
1,212
|
|
||||
Total operating expense
|
8,956
|
|
|
7,947
|
|
|
25,467
|
|
|
22,043
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Operating Income
|
860
|
|
|
1,003
|
|
|
1,249
|
|
|
1,923
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Other (Expense) Income:
|
|
|
|
|
|
|
|
||||||||
Interest expense, net
|
(229
|
)
|
|
(249
|
)
|
|
(683
|
)
|
|
(750
|
)
|
||||
Amortization of debt discount, net
|
(48
|
)
|
|
(53
|
)
|
|
(141
|
)
|
|
(170
|
)
|
||||
Loss on extinguishment of debt
|
(5
|
)
|
|
(360
|
)
|
|
(38
|
)
|
|
(360
|
)
|
||||
Miscellaneous, net
|
(31
|
)
|
|
25
|
|
|
(35
|
)
|
|
(55
|
)
|
||||
Total other expense, net
|
(313
|
)
|
|
(637
|
)
|
|
(897
|
)
|
|
(1,335
|
)
|
||||
|
|
|
|
|
|
|
|
||||||||
Income Before Income Taxes
|
547
|
|
|
366
|
|
|
352
|
|
|
588
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Income Tax Benefit (Provision)
|
2
|
|
|
(3
|
)
|
|
77
|
|
|
(14
|
)
|
||||
|
|
|
|
|
|
|
|
||||||||
Net Income
|
$
|
549
|
|
|
$
|
363
|
|
|
$
|
429
|
|
|
$
|
574
|
|
|
|
|
|
|
|
|
|
||||||||
Basic Earnings Per Share
|
$
|
0.66
|
|
|
$
|
0.43
|
|
|
$
|
0.51
|
|
|
$
|
0.69
|
|
Diluted Earnings Per Share
|
$
|
0.65
|
|
|
$
|
0.43
|
|
|
$
|
0.51
|
|
|
$
|
0.68
|
|
|
|
|
|
|
|
|
|
||||||||
The accompanying notes are an integral part of these Condensed Consolidated Financial Statements.
|
|
Nine Months Ended September 30,
|
||||||
(in millions)
|
2011
|
|
2010
|
||||
Net Cash Provided By Operating Activities
|
$
|
1,676
|
|
|
$
|
2,514
|
|
|
|
|
|
||||
Cash Flows From Investing Activities:
|
|
|
|
||||
Property and equipment additions:
|
|
|
|
||||
Flight equipment, including advance payments
|
(676
|
)
|
|
(753
|
)
|
||
Ground property and equipment, including technology
|
(210
|
)
|
|
(168
|
)
|
||
Purchase of investments
|
(719
|
)
|
|
(451
|
)
|
||
Redemption of investments
|
503
|
|
|
—
|
|
||
Other, net
|
16
|
|
|
15
|
|
||
Net cash used in investing activities
|
(1,086
|
)
|
|
(1,357
|
)
|
||
|
|
|
|
||||
Cash Flows From Financing Activities:
|
|
|
|
||||
Payments on long-term debt and capital lease obligations
|
(3,426
|
)
|
|
(2,546
|
)
|
||
Proceeds from long-term obligations
|
2,380
|
|
|
223
|
|
||
Debt issuance costs
|
(62
|
)
|
|
—
|
|
||
Restricted cash and cash equivalents
|
(84
|
)
|
|
—
|
|
||
Other, net
|
17
|
|
|
(5
|
)
|
||
Net cash used in financing activities
|
(1,175
|
)
|
|
(2,328
|
)
|
||
|
|
|
|
||||
Net Decrease in Cash and Cash Equivalents
|
(585
|
)
|
|
(1,171
|
)
|
||
Cash and cash equivalents at beginning of period
|
2,892
|
|
|
4,607
|
|
||
Cash and cash equivalents at end of period
|
$
|
2,307
|
|
|
$
|
3,436
|
|
|
|
|
|
||||
Non-cash transactions:
|
|
|
|
||||
Flight equipment under capital leases
|
$
|
98
|
|
|
$
|
203
|
|
JFK redevelopment project funded by third parties
|
70
|
|
|
—
|
|
||
Debt relief through vendor negotiations
|
—
|
|
|
160
|
|
||
Debt discount on American Express Agreement
|
—
|
|
|
110
|
|
||
|
|
|
|
||||
The accompanying notes are an integral part of these Condensed Consolidated Financial Statements.
|
(in millions)
|
September 30, 2011
|
Level 1
|
Level 2
|
Level 3
|
||||||||
Cash equivalents
|
$
|
2,082
|
|
$
|
2,082
|
|
$
|
—
|
|
$
|
—
|
|
Short-term investments
|
958
|
|
958
|
|
—
|
|
—
|
|
||||
Restricted cash equivalents and short-term investments
|
441
|
|
441
|
|
—
|
|
—
|
|
||||
Long-term investments
|
134
|
|
—
|
|
25
|
|
109
|
|
||||
Hedge derivatives, net
|
|
|
|
|
||||||||
Fuel hedge contracts
|
(119
|
)
|
—
|
|
(119
|
)
|
—
|
|
||||
Interest rate contracts
|
(119
|
)
|
—
|
|
(119
|
)
|
—
|
|
||||
Foreign currency exchange contracts
|
(92
|
)
|
—
|
|
(92
|
)
|
—
|
|
(in millions)
|
December 31, 2010
|
Level 1
|
Level 2
|
Level 3
|
||||||||
Cash equivalents
|
$
|
2,696
|
|
$
|
2,696
|
|
$
|
—
|
|
$
|
—
|
|
Short-term investments
|
718
|
|
718
|
|
—
|
|
—
|
|
||||
Restricted cash equivalents and short-term investments
|
440
|
|
440
|
|
—
|
|
—
|
|
||||
Long-term investments
|
144
|
|
—
|
|
25
|
|
119
|
|
||||
Hedge derivatives, net
|
|
|
|
|
||||||||
Fuel hedge contracts
|
351
|
|
—
|
|
351
|
|
—
|
|
||||
Interest rate contracts
|
(74
|
)
|
—
|
|
(74
|
)
|
—
|
|
||||
Foreign currency exchange contracts
|
(96
|
)
|
—
|
|
(96
|
)
|
—
|
|
•
|
Fuel Derivatives.
Our fuel derivative instruments generally consist of (1) single and multi-structured option contracts, (2) swap contracts and (3) futures contracts. Heating oil, crude oil and jet fuel are the underlying commodities for these instruments. 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 regularly trade in public markets. Volatilities used in these valuations ranged from
16% to 52%
depending on the maturity dates, underlying commodities and strike prices of the option contracts. Swap and futures contracts are valued under the income approach using a discounted cash flow model based on data either readily observable or derived from public markets. Discount factors used in these valuations ranged from
0.995 to 0.999
based on interest rates applicable to the maturity dates of the swap and futures contracts.
|
•
|
Interest Rate Derivatives.
Our interest rate derivative instruments consist of swap contracts and are valued primarily based on data readily observable in public markets.
|
•
|
Foreign Currency Derivatives.
Our foreign currency derivative instruments consist of Japanese yen and Canadian dollar forward contracts and are valued based on data readily observable in public markets.
|
(in millions)
|
September 30,
2011 |
December 31,
2010 |
||||
Total debt at par value
|
$
|
14,543
|
|
$
|
15,442
|
|
Unamortized discount, net
|
(793
|
)
|
(935
|
)
|
||
Net carrying amount
|
$
|
13,750
|
|
$
|
14,507
|
|
Fair value
|
$
|
14,200
|
|
$
|
15,400
|
|
|
Effective Portion Recognized in Other Comprehensive Income (Loss)
|
|
Effective Portion Reclassified from Accumulated Other Comprehensive Loss to Earnings
|
|
Ineffective Portion Recognized in Other (Expense) Income
|
|||||||||||||||
(in millions)
|
2011
|
2010
|
|
2011
|
2010
|
|
2011
|
2010
|
||||||||||||
Three Months Ended September 30
|
|
|
|
|
|
|
|
|
||||||||||||
Fuel hedge contracts
(1)
|
$
|
(70
|
)
|
$
|
165
|
|
|
$
|
68
|
|
$
|
(66
|
)
|
|
$
|
—
|
|
$
|
12
|
|
Interest rate contracts
(2)
|
(51
|
)
|
(16
|
)
|
|
—
|
|
(1
|
)
|
|
—
|
|
—
|
|
||||||
Foreign currency exchange contracts
(3)
|
(22
|
)
|
(25
|
)
|
|
(31
|
)
|
(12
|
)
|
|
—
|
|
—
|
|
||||||
Total designated
|
$
|
(143
|
)
|
$
|
124
|
|
|
$
|
37
|
|
$
|
(79
|
)
|
|
$
|
—
|
|
$
|
12
|
|
Nine Months Ended September 30
|
|
|
|
|
|
|
|
|
||||||||||||
Fuel hedge contracts
(1)
|
$
|
(136
|
)
|
$
|
(61
|
)
|
|
$
|
202
|
|
$
|
(92
|
)
|
|
$
|
(10
|
)
|
$
|
(25
|
)
|
Interest rate contracts
(2)
|
(44
|
)
|
(55
|
)
|
|
—
|
|
(1
|
)
|
|
—
|
|
—
|
|
||||||
Foreign currency exchange contracts
(3)
|
4
|
|
(33
|
)
|
|
(53
|
)
|
(21
|
)
|
|
—
|
|
—
|
|
||||||
Total designated
|
$
|
(176
|
)
|
$
|
(149
|
)
|
|
$
|
149
|
|
$
|
(114
|
)
|
|
$
|
(10
|
)
|
$
|
(25
|
)
|
(1)
|
Gains (losses) on fuel hedge contracts reclassified from accumulated other comprehensive loss are recorded in aircraft fuel and related taxes. For the
three and nine months ended September 30, 2011
, we recorded mark-to-market losses of
$179 million
and
$99 million
, respectively, related to contracts that were not designated as hedges in aircraft fuel and related taxes.
|
(2)
|
Gains (losses) on interest rate contracts reclassified from accumulated other comprehensive loss are recorded in interest expense.
|
(3)
|
Gains (losses) on foreign currency exchange contracts reclassified from accumulated other comprehensive loss are recorded in passenger revenue.
|
(in millions, unless otherwise stated)
|
Notional Balance
|
Maturity Date
|
Prepaid Expenses
and Other Assets
|
Other Noncurrent Assets
|
Other Accrued Liabilities
|
Other Noncurrent Liabilities
|
Hedge Margin Receivable (Payable), net
|
||||||||||
As of September 30, 2011:
|
|
|
|
|
|
|
|
||||||||||
Designated as hedges
|
|
|
|
|
|
|
|
||||||||||
Interest rate contracts
|
$1,014
|
December 2012 -
May 2019 |
$
|
—
|
|
$
|
—
|
|
$
|
(59
|
)
|
$
|
(60
|
)
|
|
||
Foreign currency exchange contracts
|
137.3 billion Japanese yen; 370 million Canadian dollars
|
October 2011 - April 2014
|
11
|
|
11
|
|
(63
|
)
|
(51
|
)
|
|
||||||
Total designated
|
|
|
11
|
|
11
|
|
(122
|
)
|
(111
|
)
|
|
||||||
Not designated as hedges
|
|
|
|
|
|
|
|
||||||||||
Fuel hedge contracts
|
1.9 billion gallons - heating oil, crude oil and jet fuel
|
October 2011 -
December 2012 |
97
|
|
—
|
|
(213
|
)
|
(3
|
)
|
|
||||||
Total derivative instruments
|
|
|
$
|
108
|
|
$
|
11
|
|
$
|
(335
|
)
|
$
|
(114
|
)
|
$
|
27
|
|
As of December 31, 2010:
|
|
|
|
|
|
|
|
||||||||||
Designated as hedges
|
|
|
|
|
|
|
|
||||||||||
Fuel hedge contracts
|
1.5 billion gallons - crude oil
|
January 2011 -
February 2012 |
$
|
328
|
|
$
|
24
|
|
$
|
—
|
|
$
|
—
|
|
|
||
Interest rate contracts
|
$1,143
|
August 2011 -
May 2019 |
—
|
|
—
|
|
(35
|
)
|
(39
|
)
|
|
||||||
Foreign currency exchange contracts
|
141.1 billion Japanese yen; 233 million Canadian dollars
|
January 2011 -
November 2013 |
—
|
|
—
|
|
(60
|
)
|
(36
|
)
|
|
||||||
Total designated
|
|
|
328
|
|
24
|
|
(95
|
)
|
(75
|
)
|
|
||||||
Not designated as hedges
|
|
|
|
|
|
|
|
||||||||||
Fuel hedge contracts
|
192 million gallons - crude oil and crude oil products
|
January 2011 -
December 2011 |
27
|
|
14
|
|
(19
|
)
|
(8
|
)
|
|
||||||
Total derivative instruments
|
|
|
$
|
355
|
|
$
|
38
|
|
$
|
(114
|
)
|
$
|
(83
|
)
|
$
|
(119
|
)
|
(In millions, unless otherwise stated)
|
March 2011 Quarter Proceeds Received
|
September 2011 Quarter Proceeds Received
|
Total Principal
|
Fixed Interest Rate
|
Offering Completion Date
|
Final Maturity Date
|
Collateral
|
|||||||||
2010-1B
|
$
|
100
|
|
$
|
—
|
|
$
|
100
|
|
|
6.375%
|
February 2011
|
January 2016
|
24
|
|
aircraft
|
2010-2A
|
51
|
|
153
|
|
474
|
|
(1)
|
4.950%
|
November 2010
|
May 2019
|
28
|
|
aircraft
|
|||
2010-2B
|
92
|
|
43
|
|
135
|
|
|
6.750%
|
February 2011
|
November 2015
|
28
|
|
aircraft
(2)
|
|||
2011-1A
|
—
|
|
293
|
|
293
|
|
|
5.300%
|
April 2011
|
April 2019
|
26
|
|
aircraft
|
|||
2011-1B
|
—
|
|
102
|
|
102
|
|
|
7.125%
|
August 2011
|
October 2014
|
26
|
|
aircraft
(3)
|
|||
Total
|
$
|
243
|
|
$
|
591
|
|
$
|
1,104
|
|
|
|
|
|
|
|
(1)
|
In November 2010, we received and used
$270 million
in proceeds from the 2010-2A EETC to finance or refinance
12
aircraft.
|
(2)
|
The 2010-2B EETC is secured by the same
28
aircraft that secure the 2010-2A EETC.
|
(3)
|
The 2011-1B EETC is secured by the same
26
aircraft that secure the 2011-1A EETC.
|
•
|
a minimum fixed charge coverage ratio (defined as the ratio of (1) earnings before interest, taxes, depreciation, amortization and aircraft rent, and other adjustments to (2) the sum of gross cash interest expense (including the interest portion of our capitalized lease obligations) and cash aircraft rent expense, for successive trailing 12-month periods ending at each quarter-end date through the last maturity date of the Senior Secured Credit Facilities), which minimum ratio is
1.20:1
;
|
•
|
not less than
$1.0 billion
of unrestricted cash, cash equivalents and permitted investments and maintain
$2.0 billion
of unrestricted cash, cash equivalents and permitted investments plus unused commitments available under the Revolving Credit Facility and any other revolving credit facilities;
|
•
|
a minimum total collateral coverage ratio (defined as the ratio of (1) certain of the Collateral that meets specified eligibility standards to (2) the sum of the aggregate outstanding obligations under the Senior Secured Credit Facilities and the aggregate amount of certain hedging obligations then outstanding (the "Total Obligations")) of
1.67:1
at all times; and
|
•
|
a minimum non-route collateral coverage ratio (defined as the ratio of (1) certain of the Collateral that meets specified eligibility standards other than non-Pacific international routes to (2) the Total Obligations) of
0.75:1
at all times.
|
Years Ending December 31,
(in millions)
|
Total Secured and Unsecured Debt
|
Amortization of Debt Discount, net
|
|
||||||
Three months ending December 31, 2011
|
$
|
432
|
|
$
|
(53
|
)
|
|
||
2012
|
1,848
|
|
(201
|
)
|
|
||||
2013
|
1,578
|
|
(165
|
)
|
|
||||
2014
|
2,417
|
|
(111
|
)
|
|
||||
2015
|
1,439
|
|
(76
|
)
|
|
||||
Thereafter
|
6,829
|
|
(187
|
)
|
|
||||
Total
|
$
|
14,543
|
|
$
|
(793
|
)
|
$
|
13,750
|
|
Years Ending December 31,
(in millions)
|
|
||
Three months ending December 31, 2011
|
$
|
30
|
|
2012
|
215
|
|
|
2013
|
530
|
|
|
2014
|
745
|
|
|
2015
|
760
|
|
|
2016
|
760
|
|
|
Thereafter
|
3,810
|
|
|
Total
|
$
|
6,850
|
|
|
Pension Benefits
|
|
Other Postretirement and
Postemployment Benefits
|
||||||||||
(in millions)
|
2011
|
2010
|
|
2011
|
2010
|
||||||||
Three Months Ended September 30
|
|
|
|
|
|
||||||||
Service cost
|
$
|
—
|
|
$
|
—
|
|
|
$
|
13
|
|
$
|
14
|
|
Interest cost
|
242
|
|
245
|
|
|
45
|
|
49
|
|
||||
Expected return on plan assets
|
(181
|
)
|
(169
|
)
|
|
(22
|
)
|
(22
|
)
|
||||
Amortization of prior service benefit
|
—
|
|
—
|
|
|
(1
|
)
|
(1
|
)
|
||||
Recognized net actuarial loss (gain)
|
14
|
|
12
|
|
|
(3
|
)
|
(1
|
)
|
||||
Settlements
|
—
|
|
4
|
|
|
—
|
|
—
|
|
||||
Net periodic cost
|
$
|
75
|
|
$
|
92
|
|
|
$
|
32
|
|
$
|
39
|
|
Nine Months Ended September 30
|
|
|
|
|
|
||||||||
Service cost
|
$
|
—
|
|
$
|
—
|
|
|
$
|
39
|
|
$
|
44
|
|
Interest cost
|
726
|
|
737
|
|
|
135
|
|
147
|
|
||||
Expected return on plan assets
|
(543
|
)
|
(508
|
)
|
|
(67
|
)
|
(68
|
)
|
||||
Amortization of prior service benefit
|
—
|
|
—
|
|
|
(2
|
)
|
(3
|
)
|
||||
Recognized net actuarial loss (gain)
|
42
|
|
36
|
|
|
(9
|
)
|
(3
|
)
|
||||
Settlements
|
—
|
|
10
|
|
|
—
|
|
—
|
|
||||
Net periodic cost
|
$
|
225
|
|
$
|
275
|
|
|
$
|
96
|
|
$
|
117
|
|
(in millions)
|
Pension and Other Benefits Liabilities
|
Derivative Instruments
(1)
|
Valuation Allowance
|
Total
|
||||||||
Balance at December 31, 2010
|
$
|
(2,053
|
)
|
$
|
(312
|
)
|
$
|
(1,213
|
)
|
$
|
(3,578
|
)
|
Changes in fair value
|
—
|
|
214
|
|
—
|
|
214
|
|
||||
Reclassification into earnings
|
10
|
|
(49
|
)
|
—
|
|
(39
|
)
|
||||
Tax effect
|
(4
|
)
|
(61
|
)
|
65
|
|
—
|
|
||||
Balance at March 31, 2011
|
$
|
(2,047
|
)
|
$
|
(208
|
)
|
$
|
(1,148
|
)
|
$
|
(3,403
|
)
|
Changes in fair value
|
—
|
|
(135
|
)
|
—
|
|
(135
|
)
|
||||
Reclassification into earnings
|
8
|
|
(63
|
)
|
—
|
|
(55
|
)
|
||||
Tax effect
|
(3
|
)
|
73
|
|
(70
|
)
|
—
|
|
||||
Balance at June 30, 2011
|
$
|
(2,042
|
)
|
$
|
(333
|
)
|
$
|
(1,218
|
)
|
$
|
(3,593
|
)
|
Changes in fair value
|
—
|
|
(106
|
)
|
—
|
|
(106
|
)
|
||||
Reclassification into earnings
|
12
|
|
(37
|
)
|
—
|
|
(25
|
)
|
||||
Tax effect
|
(5
|
)
|
54
|
|
(49
|
)
|
—
|
|
||||
Balance at September 30, 2011
|
$
|
(2,035
|
)
|
$
|
(422
|
)
|
$
|
(1,267
|
)
|
$
|
(3,724
|
)
|
(1)
|
Includes
$321 million
of deferred income tax expense that will remain in accumulated other comprehensive loss until all amounts in accumulated other comprehensive loss that relate to fuel derivatives which were designated as accounting hedges are recognized in the Consolidated Statement of Operations. For additional information see Note 9.
|
|
Three Months Ended September 30,
|
Nine Months Ended September 30,
|
||||||||||
(in millions)
|
2011
|
2010
|
2011
|
2010
|
||||||||
Severance and related costs
|
$
|
3
|
|
$
|
7
|
|
$
|
83
|
|
$
|
15
|
|
Facilities and fleet
|
—
|
|
146
|
|
71
|
|
182
|
|
||||
Merger-related items
|
—
|
|
53
|
|
—
|
|
145
|
|
||||
Total restructuring and other items
|
$
|
3
|
|
$
|
206
|
|
$
|
154
|
|
$
|
342
|
|
(in millions)
|
Severance and Related Costs
|
Facilities and Other
|
Total
|
||||||
Balance as of December 31, 2010
|
$
|
20
|
|
$
|
85
|
|
$
|
105
|
|
Additional cost and expenses
|
83
|
|
—
|
|
83
|
|
|||
Payments
|
(14
|
)
|
(18
|
)
|
(32
|
)
|
|||
Balance as of September 30, 2011
|
$
|
89
|
|
$
|
67
|
|
$
|
156
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||
(in millions, except per share data)
|
2011
|
2010
|
|
2011
|
2010
|
||||||||
Net income
|
$
|
549
|
|
$
|
363
|
|
|
$
|
429
|
|
$
|
574
|
|
|
|
|
|
|
|
||||||||
Basic weighted average shares outstanding
|
838
|
|
835
|
|
|
838
|
|
834
|
|
||||
Dilutive effects of share based awards
|
6
|
7
|
|
|
6
|
|
8
|
|
|||||
Diluted weighted average shares outstanding
|
844
|
842
|
|
|
844
|
842
|
|
||||||
|
|
|
|
|
|
||||||||
Basic earnings per share
|
$
|
0.66
|
|
$
|
0.43
|
|
|
$
|
0.51
|
|
$
|
0.69
|
|
Diluted earnings per share
|
$
|
0.65
|
|
$
|
0.43
|
|
|
$
|
0.51
|
|
$
|
0.68
|
|
|
|
|
|
|
|
||||||||
Antidilutive common stock equivalents excluded from diluted earnings per share
|
26
|
25
|
|
|
25
|
23
|
|
•
|
Adjusting fares in response to higher fuel prices and continuing to grow our revenues by providing new products and services, such as our new Economy Comfort product;
|
•
|
Reducing December 2011 quarter system capacity by 4-5% year-over-year, focused in markets where revenues do not cover higher fuel costs. Domestic capacity is expected to decrease 3-5%, which includes the retirement of less efficient aircraft. Our transatlantic capacity is expected to decrease 10-12%, as we work with our joint venture partners, AirFrance-KLM and Alitalia, to reduce our combined fourth quarter transatlantic capacity;
|
•
|
Retiring our least efficient aircraft, including the DC9-50 and regional turboprop fleets and 50-seat regional jets;
|
•
|
Resizing our workforce through voluntary workforce reduction programs. Approximately 2,000 employees elected to participate in those programs; and
|
•
|
Consolidating facilities in Atlanta, Minneapolis, Cincinnati and Memphis.
|
|
Three Months Ended September 30,
|
|
|
||||||||
(in millions)
|
2011
|
2010
|
Increase
|
% Increase
|
|||||||
Passenger:
|
|
|
|
|
|||||||
Mainline
|
$
|
6,857
|
|
$
|
6,204
|
|
$
|
653
|
|
11
|
%
|
Regional carriers
|
1,711
|
|
1,571
|
|
140
|
|
9
|
%
|
|||
Total passenger revenue
|
8,568
|
|
7,775
|
|
793
|
|
10
|
%
|
|||
Cargo
|
257
|
|
227
|
|
30
|
|
13
|
%
|
|||
Other
|
991
|
|
948
|
|
43
|
|
5
|
%
|
|||
Total operating revenue
|
$
|
9,816
|
|
$
|
8,950
|
|
$
|
866
|
|
10
|
%
|
|
|
Increase (Decrease)
vs. Three Months Ended September 30, 2010
|
||||||||||||||
(in millions)
|
Three Months Ended September 30, 2011
|
Passenger Revenue
|
RPMs
(1)
(Traffic)
|
ASMs
(2)
(Capacity)
|
Passenger Mile Yield
|
PRASM
(3)
|
Load Factor
|
|||||||||
Domestic
|
$
|
3,536
|
|
10
|
%
|
(1
|
)%
|
(2
|
)%
|
10
|
%
|
12
|
%
|
1.2
|
|
pts
|
Atlantic
|
1,796
|
|
6
|
%
|
(4
|
)%
|
(4
|
)%
|
10
|
%
|
10
|
%
|
0.3
|
|
pts
|
|
Pacific
|
1,073
|
|
22
|
%
|
9
|
%
|
14
|
%
|
12
|
%
|
7
|
%
|
(4.4
|
)
|
pts
|
|
Latin America
|
452
|
|
14
|
%
|
1
|
%
|
1
|
%
|
12
|
%
|
13
|
%
|
0.5
|
|
pts
|
|
Total Mainline
|
6,857
|
|
11
|
%
|
—
|
%
|
—
|
%
|
11
|
%
|
11
|
%
|
0.1
|
|
pts
|
|
Regional carriers
|
1,711
|
|
9
|
%
|
(1
|
)%
|
(3
|
)%
|
10
|
%
|
12
|
%
|
1.3
|
|
pts
|
|
Total passenger revenue
|
$
|
8,568
|
|
10
|
%
|
—
|
%
|
(1
|
)%
|
11
|
%
|
11
|
%
|
0.2
|
|
pts
|
(1)
|
Revenue passenger miles (“RPMs”)
|
(2)
|
Available seat miles (“ASMs”)
|
(3)
|
Passenger revenue per ASM (“PRASM”)
|
•
|
Domestic
. Domestic mainline passenger revenue increased
10%
due to a
12%
improvement in PRASM on a
2%
decline in capacity. The improvement in PRASM reflects a higher passenger mile yield driven by fare increases and an approximate $70 million benefit from the suspension of the FAA excise taxes for a short period during the September 2011 quarter.
|
•
|
International
. International mainline passenger revenue increased
12%
due to a
10%
improvement in PRASM on a
2%
capacity increase. Passenger mile yield increased
11%
, reflecting increased business and leisure travel and increased fares, including fuel surcharges. Atlantic passenger revenue increased
6%
due to a
10%
improvement in passenger mile yield on a
4%
decline in capacity. We intend to continue reducing capacity in the Atlantic market during the December 2011 quarter to align with expected demand. Pacific passenger revenue increased
22%
due to an improvement in passenger mile yield and a stronger revenue environment, partially offset by the continuing effects of the March 2011 events in Japan. Latin America passenger revenue increased
14%
from a stronger revenue environment for both business and leisure travel with higher PRASM and passenger mile yield driven by fare increases.
|
|
Three Months Ended September 30,
|
Increase (Decrease)
|
% Increase (Decrease)
|
||||||||
(in millions)
|
2011
|
2010
|
|||||||||
Aircraft fuel and related taxes
|
$
|
2,881
|
|
$
|
2,023
|
|
$
|
858
|
|
42
|
%
|
Salaries and related costs
|
1,717
|
|
1,669
|
|
48
|
|
3
|
%
|
|||
Contract carrier arrangements
|
1,432
|
|
1,236
|
|
196
|
|
16
|
%
|
|||
Aircraft maintenance materials and outside repairs
|
428
|
|
405
|
|
23
|
|
6
|
%
|
|||
Passenger commissions and other selling expenses
|
480
|
|
404
|
|
76
|
|
19
|
%
|
|||
Contracted services
|
419
|
|
398
|
|
21
|
|
5
|
%
|
|||
Depreciation and amortization
|
384
|
|
375
|
|
9
|
|
2
|
%
|
|||
Landing fees and other rents
|
342
|
|
331
|
|
11
|
|
3
|
%
|
|||
Passenger service
|
207
|
|
190
|
|
17
|
|
9
|
%
|
|||
Aircraft rent
|
72
|
|
92
|
|
(20
|
)
|
(22
|
)%
|
|||
Profit sharing
|
167
|
|
185
|
|
(18
|
)
|
(10
|
)%
|
|||
Restructuring and other items
|
3
|
|
206
|
|
(203
|
)
|
(99
|
)%
|
|||
Other
|
424
|
|
433
|
|
(9
|
)
|
(2
|
)%
|
|||
Total operating expense
|
$
|
8,956
|
|
$
|
7,947
|
|
$
|
1,009
|
|
13
|
%
|
(in millions)
|
Favorable (Unfavorable) vs. Three Months Ended September 30, 2010
|
||
Interest expense, net
|
$
|
20
|
|
Amortization of debt discount, net
|
5
|
|
|
Loss on extinguishment of debt
(1)
|
355
|
|
|
Mark-to-market adjustments on the ineffective portion of fuel hedge contracts
|
(12
|
)
|
|
Foreign currency exchange rates
|
(34
|
)
|
|
Other
|
(10
|
)
|
|
Total other expense, net
|
$
|
324
|
|
(1)
|
During the September 2010 quarter, we recorded a $360 million loss on the extinguishment of debt.
|
|
Nine Months Ended September 30,
|
|
|
||||||||
(in millions)
|
2011
|
2010
|
Increase
|
% Increase
|
|||||||
Passenger:
|
|
|
|
|
|||||||
Mainline
|
$
|
18,198
|
|
$
|
16,170
|
|
$
|
2,028
|
|
13
|
%
|
Regional carriers
|
4,836
|
|
4,420
|
|
416
|
|
9
|
%
|
|||
Total passenger revenue
|
23,034
|
|
20,590
|
|
2,444
|
|
12
|
%
|
|||
Cargo
|
771
|
|
614
|
|
157
|
|
26
|
%
|
|||
Other
|
2,911
|
|
2,762
|
|
149
|
|
5
|
%
|
|||
Total operating revenue
|
$
|
26,716
|
|
$
|
23,966
|
|
$
|
2,750
|
|
11
|
%
|
|
|
Increase (Decrease)
vs. Nine Months Ended September 30, 2010
|
||||||||||||||
(in millions)
|
Nine Months Ended September 30, 2011
|
Passenger
Revenue
|
RPMs
(Traffic)
|
ASMs
(Capacity)
|
Passenger Mile
Yield
|
PRASM
|
Load
Factor
|
|||||||||
Domestic
|
$
|
9,912
|
|
11
|
%
|
—
|
%
|
—
|
%
|
11
|
%
|
11
|
%
|
(0.2
|
)
|
pts
|
Atlantic
|
4,364
|
|
11
|
%
|
2
|
%
|
5
|
%
|
9
|
%
|
6
|
%
|
(2.9
|
)
|
pts
|
|
Pacific
|
2,549
|
|
22
|
%
|
7
|
%
|
14
|
%
|
14
|
%
|
8
|
%
|
(4.8
|
)
|
pts
|
|
Latin America
|
1,373
|
|
14
|
%
|
(2
|
)%
|
(1
|
)%
|
16
|
%
|
15
|
%
|
(0.9
|
)
|
pts
|
|
Total Mainline
|
18,198
|
|
13
|
%
|
1
|
%
|
3
|
%
|
11
|
%
|
9
|
%
|
(1.5
|
)
|
pts
|
|
Regional carriers
|
4,836
|
|
9
|
%
|
(3
|
)%
|
(2
|
)%
|
12
|
%
|
12
|
%
|
(0.4
|
)
|
pts
|
|
Total passenger revenue
|
$
|
23,034
|
|
12
|
%
|
1
|
%
|
2
|
%
|
11
|
%
|
9
|
%
|
(1.3
|
)
|
pts
|
•
|
Domestic
. Domestic mainline passenger revenue increased
11%
due to an
11%
improvement in PRASM while capacity remained flat. The improvement in PRASM reflects higher passenger mile yield driven by fare increases and a $70 million benefit from the suspension of the FAA excise taxes for a short period during the September 2011 quarter.
|
•
|
International
. International mainline passenger revenue increased
15%
due to an
8%
improvement in PRASM on a
6%
capacity increase. Passenger mile yield increased
12%
, reflecting increased business and leisure travel and increased fares, including fuel surcharges. Atlantic passenger revenue increased
11%
while PRASM increased
6%
. We and the industry faced overcapacity, particularly in the March 2011 quarter, which prevented us from increasing ticket prices sufficiently to cover higher fuel prices. We intend to continue reducing capacity in the Atlantic market during the December 2011 quarter to align with expected demand. Pacific passenger revenue increased
22%
as a result of an improvement in passenger mile yield and a stronger revenue environment, partially offset by the negative impact from the March 2011 events in Japan. Latin America passenger revenue benefited from higher passenger mile yield driven by fare increases.
|
|
Nine Months Ended September 30,
|
Increase (Decrease)
|
% Increase (Decrease)
|
||||||||
(in millions)
|
2011
|
2010
|
|||||||||
Aircraft fuel and related taxes
|
$
|
7,710
|
|
$
|
5,666
|
|
$
|
2,044
|
|
36
|
%
|
Salaries and related costs
|
5,183
|
|
5,043
|
|
140
|
|
3
|
%
|
|||
Contract carrier arrangements
|
4,142
|
|
3,125
|
|
1,017
|
|
33
|
%
|
|||
Aircraft maintenance materials and outside repairs
|
1,398
|
|
1,174
|
|
224
|
|
19
|
%
|
|||
Passenger commissions and other selling expenses
|
1,289
|
|
1,145
|
|
144
|
|
13
|
%
|
|||
Contracted services
|
1,259
|
|
1,156
|
|
103
|
|
9
|
%
|
|||
Depreciation and amortization
|
1,141
|
|
1,139
|
|
2
|
|
—
|
%
|
|||
Landing fees and other rents
|
975
|
|
968
|
|
7
|
|
1
|
%
|
|||
Passenger service
|
552
|
|
493
|
|
59
|
|
12
|
%
|
|||
Aircraft rent
|
224
|
|
305
|
|
(81
|
)
|
(27
|
)%
|
|||
Profit sharing
|
175
|
|
275
|
|
(100
|
)
|
(36
|
)%
|
|||
Restructuring and other items
|
154
|
|
342
|
|
(188
|
)
|
(55
|
)%
|
|||
Other
|
1,265
|
|
1,212
|
|
53
|
|
4
|
%
|
|||
Total operating expense
|
$
|
25,467
|
|
$
|
22,043
|
|
$
|
3,424
|
|
16
|
%
|
•
|
During the nine months ended September 30, 2011, we recorded an
$83 million
charge primarily related to severance costs associated with voluntary workforce reduction programs offered to align staffing with planned capacity reductions and a
$71 million
charge related to our facilities consolidation and fleet assessments.
|
•
|
During the nine months ended September 30, 2010, we recorded $182 million in asset impairment charges related to the Comair fleet reduction initiative and retired dedicated freighter aircraft and a $145 million charge for merger-related items associated with Northwest and the integration of Northwest operations into Delta.
|
(in millions)
|
Favorable (Unfavorable) vs. Nine Months Ended September 30, 2010
|
||
Interest expense, net
|
$
|
67
|
|
Amortization of debt discount, net
|
29
|
|
|
Loss on extinguishment of debt
(1)
|
322
|
|
|
Mark-to-market adjustments on the ineffective portion of fuel hedge contracts
|
15
|
|
|
Foreign currency exchange rates
|
8
|
|
|
Other
|
(3
|
)
|
|
Total other expense, net
|
$
|
438
|
|
(1)
|
During the nine months ended September 30, 2010, we recorded a $360 million loss on the extinguishment of debt.
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||||
|
2011
|
2010
|
|
2011
|
2010
|
||||||||||||
Consolidated
(1)
:
|
|
|
|
|
|
|
|
|
|
||||||||
Revenue passenger miles (millions)
|
54,497
|
|
54,675
|
|
|
147,792
|
|
146,936
|
|
||||||||
Available seat miles (millions)
|
63,262
|
|
63,658
|
|
|
179,622
|
|
175,657
|
|
||||||||
Passenger mile yield
|
15.72
|
|
¢
|
14.22
|
|
¢
|
|
15.59
|
|
¢
|
14.01
|
|
¢
|
||||
Passenger revenue per available seat mile
|
13.54
|
|
¢
|
12.21
|
|
¢
|
|
12.82
|
|
¢
|
11.72
|
|
¢
|
||||
Operating cost per available seat mile
|
14.16
|
|
¢
|
12.48
|
|
¢
|
|
14.18
|
|
¢
|
12.55
|
|
¢
|
||||
Passenger load factor
|
86.1
|
|
%
|
85.9
|
|
%
|
|
82.3
|
|
%
|
83.6
|
|
%
|
||||
Fuel gallons consumed (millions)
|
1,044
|
|
1,051
|
|
|
2,955
|
|
2,887
|
|
||||||||
Average price per fuel gallon
(2)
|
$
|
3.29
|
|
|
$
|
2.29
|
|
|
|
$
|
3.14
|
|
|
$
|
2.28
|
|
|
Average price per fuel gallon, adjusted
(3)
|
$
|
3.09
|
|
|
$
|
2.29
|
|
|
|
$
|
3.07
|
|
|
$
|
2.28
|
|
|
Full-time equivalent employees, end of period
|
79,709
|
|
79,005
|
|
|
79,709
|
|
79,005
|
|
||||||||
Mainline:
|
|
|
|
|
|
|
|
|
|
||||||||
Revenue passenger miles (millions)
|
47,881
|
|
47,984
|
|
|
129,247
|
|
127,913
|
|
||||||||
Available seat miles (millions)
|
55,107
|
|
55,276
|
|
|
155,967
|
|
151,528
|
|
||||||||
Operating cost per available seat mile
|
13.13
|
|
¢
|
11.29
|
|
¢
|
|
13.06
|
|
¢
|
11.45
|
|
¢
|
||||
Fuel gallons consumed (millions)
|
853
|
|
856
|
|
|
2,406
|
|
2,335
|
|
||||||||
Average price per fuel gallon
(2)
|
$
|
3.29
|
|
|
$
|
2.29
|
|
|
|
$
|
3.11
|
|
|
$
|
2.28
|
|
|
Average price per fuel gallon, adjusted
(3)
|
$
|
3.05
|
|
|
$
|
2.29
|
|
|
|
$
|
3.03
|
|
|
$
|
2.28
|
|
|
(1)
|
Includes the operations of our contract carriers under capacity purchase agreements, except full-time equivalent employees which excludes employees of contract carriers that we do not own.
|
(2)
|
Includes the impact of fuel hedge activity.
|
(3)
|
Adjusted for mark-to-market adjustments for fuel hedges recorded in periods other than the settlement period (a non-GAAP financial measure as defined in "Supplemental Information" below).
|
|
Current Fleet
(1)(2)
|
|
|
|||||||||||
Aircraft Type
|
Owned
|
Capital Lease
|
Operating Lease
|
Total
|
Average Age
|
Commitments
(3)
|
Options
(4)
|
|||||||
B-737-700
|
10
|
|
—
|
|
—
|
|
10
|
|
2.7
|
|
—
|
|
—
|
|
B-737-800
|
73
|
|
—
|
|
—
|
|
73
|
|
10.7
|
|
—
|
|
—
|
|
B-737-900ER
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
100
|
|
30
|
|
B-747-400
|
4
|
|
8
|
|
3
|
|
15
|
|
18.3
|
|
—
|
|
—
|
|
B-757-200
|
90
|
|
37
|
|
33
|
|
160
|
|
18.5
|
|
—
|
|
—
|
|
B-757-300
|
16
|
|
—
|
|
—
|
|
16
|
|
8.6
|
|
—
|
|
—
|
|
B-767-300
|
10
|
|
2
|
|
4
|
|
16
|
|
20.7
|
|
—
|
|
—
|
|
B-767-300ER
|
50
|
|
3
|
|
4
|
|
57
|
|
15.4
|
|
—
|
|
4
|
|
B-767-400ER
|
21
|
|
—
|
|
—
|
|
21
|
|
10.6
|
|
—
|
|
8
|
|
B-777-200ER
|
8
|
|
—
|
|
—
|
|
8
|
|
11.7
|
|
—
|
|
—
|
|
B-777-200LR
|
10
|
|
—
|
|
—
|
|
10
|
|
2.5
|
|
—
|
|
14
|
|
B-787-8
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
18
|
|
—
|
|
A319-100
|
55
|
|
—
|
|
2
|
|
57
|
|
9.7
|
|
—
|
|
—
|
|
A320-200
|
41
|
|
—
|
|
28
|
|
69
|
|
16.6
|
|
—
|
|
—
|
|
A330-200
|
11
|
|
—
|
|
—
|
|
11
|
|
6.5
|
|
—
|
|
—
|
|
A330-300
|
21
|
|
—
|
|
—
|
|
21
|
|
6.1
|
|
—
|
|
—
|
|
MD-88
|
66
|
|
51
|
|
—
|
|
117
|
|
21.2
|
|
—
|
|
—
|
|
MD-90
|
28
|
|
—
|
|
—
|
|
28
|
|
14.9
|
|
11
|
|
7
|
|
DC9-50
|
27
|
|
—
|
|
—
|
|
27
|
|
33.3
|
|
—
|
|
—
|
|
CRJ-100
|
16
|
|
11
|
|
17
|
|
44
|
|
13.6
|
|
—
|
|
—
|
|
CRJ-200
|
—
|
|
—
|
|
2
|
|
2
|
|
16.4
|
|
—
|
|
—
|
|
CRJ-700
|
15
|
|
—
|
|
—
|
|
15
|
|
7.9
|
|
—
|
|
—
|
|
CRJ-900
|
13
|
|
—
|
|
—
|
|
13
|
|
3.8
|
|
—
|
|
—
|
|
Embraer 175
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
36
|
|
Total Aircraft
|
585
|
|
112
|
|
93
|
|
790
|
|
15.5
|
|
129
|
|
99
|
|
(1)
|
Excludes all grounded aircraft, including 15 CRJ-100/200, 12 DC9, ten SAAB 340B+, eight B-757-200, one B-747-400 and one B-767-300ER aircraft that were grounded during the nine months ended September 30, 2011.
|
(2)
|
Excludes 179 CRJ-200, 51 CRJ-900, 40 Embraer 170/175, 14 SAAB 340+ and 12 CRJ-700 aircraft, which we own or lease and which are operated by third party contract carriers on our behalf. These aircraft are included in the third party contract carriers table below.
|
(3)
|
Excludes our orders for five A319-100 and two A320-200 aircraft because we have the right to cancel these orders.
|
(4)
|
Aircraft options have scheduled delivery slots.
|
•
|
Entered into an agreement with Boeing to purchase 100 B-737-900ER aircraft;
|
•
|
Purchased ten previously owned MD-90 aircraft and one leased B-767-300 aircraft; and
|
•
|
Leased six MD-90 aircraft and one B-757-200 aircraft.
|
|
Fleet Type
|
|
||||||||||||||
Carrier
|
CRJ-200
|
CRJ-700
|
CRJ-900
|
ERJ-145
|
Embraer 170
|
Embraer 175
|
SAAB 340+
|
Total
|
||||||||
Atlantic Southeast Airlines, Inc.
|
99
|
|
46
|
|
10
|
|
—
|
|
—
|
|
—
|
|
—
|
|
155
|
|
Pinnacle
|
122
|
|
—
|
|
16
|
|
—
|
|
—
|
|
—
|
|
—
|
|
138
|
|
SkyWest Airlines, Inc.
|
58
|
|
18
|
|
21
|
|
—
|
|
—
|
|
—
|
|
—
|
|
97
|
|
Chautauqua Airlines, Inc.
|
—
|
|
—
|
|
—
|
|
24
|
|
—
|
|
—
|
|
—
|
|
24
|
|
Compass
|
—
|
|
—
|
|
—
|
|
—
|
|
3
|
|
36
|
|
—
|
|
39
|
|
Mesaba
|
19
|
|
—
|
|
41
|
|
—
|
|
—
|
|
—
|
|
14
|
|
74
|
|
Shuttle America Corporation
|
—
|
|
—
|
|
—
|
|
—
|
|
11
|
|
16
|
|
—
|
|
27
|
|
Total
|
298
|
|
64
|
|
88
|
|
24
|
|
14
|
|
52
|
|
14
|
|
554
|
|
•
|
2010-1B EETC.
We completed a $100 million offering of Pass Through Certificates, Series 2010-1B (the “2010-1B EETC”), through a pass through trust. The 2010-1B EETC, which is secured by 24 aircraft, bears interest at a fixed rate of 6.375% per year and has a final maturity in January 2016.
|
•
|
2010-2A EETC.
We used $204 million in proceeds previously held in escrow under our Pass Through Certificates, Series 2010-2A EETC (the "2010-2A EETC"), to refinance 16 aircraft.
|
•
|
2010-2B EETC.
We completed a $135 million offering of Pass Through Certificates, Series 2010-2B (the “2010-2B EETC”), through a pass through trust. The 2010-2B EETC, which is secured by 28 aircraft, bears interest at a fixed rate of 6.75% per year and has a final maturity in November 2015.
|
•
|
2011-1A EETC.
We completed a $293 million offering of Pass Through Certificates, Series 2011-1A (the “2011-1A EETC”), through a pass through trust. The 2011-1A EETC, which is secured by 26 aircraft, bears interest at a fixed rate of 5.3% per year and has a final maturity in April 2019.
|
•
|
2011-1B EETC.
We completed a $102 million offering of Pass Through Certificates, Series 2011-1B (the “2011-1B EETC”), through a pass through trust. The 2011-1B EETC, which is secured by 26 aircraft, bears interest at a fixed rate of 7.125% per year and has a final maturity in October 2014.
|
•
|
2001-1 EETC.
We paid $746 million to retire the outstanding principal amount under the Pass Through Certificates, Series 2001-1 EETC ("the "2001-1 EETC"), which resulted in the release of 36 aircraft that had secured the 2001-1 EETC. We used 10 of those aircraft as security for the 2010-2 EETC and the remaining 26 aircraft to secure the 2011-1 EETC.
|
•
|
Pacific Routes Term Loan Facility.
We amended our $250 million first-lien term loan facility (the "Pacific Routes Term Loan Facility") to, among other things, reduce the interest rate and extend the maturity date from September 2013 to March 2016. At September 30, 2011, the Pacific Routes Term Loan Facility had an interest rate of 4.25% per annum.
|
•
|
Senior Secured Credit Facilities.
We entered into senior secured first-lien credit facilities (the "Senior Secured Credit Facilities") to borrow up to $2.6 billion. In connection with entering into the Senior Secured Credit Facilities, we retired outstanding loans under our $2.5 billion senior secured exit financing facilities and terminated those facilities and an existing $100 million revolving credit facility. The Senior Secured Credit Facilities bear interest at a variable rate equal to LIBOR (subject to a 1.25% floor) or another index rate, in each case plus a specified margin and have final maturities in April 2016 and 2017. At September 30, 2011, the outstanding balances under the Senior Secured Credit Facilities had an interest rate of 5.5% per annum.
|
•
|
Aircraft fuel and related taxes.
Management believes the volatility in fuel prices impacts the comparability of year-over-year financial performance.
|
•
|
Ancillary businesses
. Ancillary businesses are not related to the generation of a seat mile. These businesses include aircraft maintenance and staffing services we provide to third parties and our vacation wholesale operations.
|
•
|
Mark-to-market ("MTM") adjustments for fuel hedges recorded in periods other than the settlement period.
Management believes the adjustment of this item is helpful to evaluate our financial results in the period shown.
|
•
|
Profit sharing.
Management believes the exclusion of this item provides a more meaningful comparison of our results to the airline industry and our prior year results.
|
•
|
Restructuring and other items.
Management believes the exclusion of this item is helpful to investors to evaluate our recurring operational performance.
|
|
Three Months Ended September 30,
|
|||||
|
2011
|
2010
|
||||
CASM
|
14.16
|
|
¢
|
12.48
|
|
¢
|
Items excluded:
|
|
|
|
|
||
Aircraft fuel and related taxes
|
(5.09
|
)
|
|
(3.77
|
)
|
|
Ancillary businesses
|
(0.38
|
)
|
|
(0.26
|
)
|
|
MTM adjustments for fuel hedges recorded in periods other than the settlement period
|
(0.33
|
)
|
|
—
|
|
|
Profit sharing
|
(0.26
|
)
|
|
(0.29
|
)
|
|
Restructuring and other items
|
—
|
|
|
(0.32
|
)
|
|
CASM-Ex
|
8.10
|
|
¢
|
7.84
|
|
¢
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||
|
2011
|
2010
|
|
2011
|
2010
|
||||||||
Consolidated
(1)
:
|
|
|
|
|
|
||||||||
Average price per fuel gallon
(2)
|
$
|
3.29
|
|
$
|
2.29
|
|
|
$
|
3.14
|
|
$
|
2.28
|
|
MTM adjustments for fuel hedges recorded in periods other than the settlement period
|
(0.20
|
)
|
—
|
|
|
(0.07
|
)
|
—
|
|
||||
Average price per fuel gallon, adjusted
|
$
|
3.09
|
|
$
|
2.29
|
|
|
$
|
3.07
|
|
$
|
2.28
|
|
Mainline:
|
|
|
|
|
|
||||||||
Average price per fuel gallon
(2)
|
$
|
3.29
|
|
$
|
2.29
|
|
|
$
|
3.11
|
|
$
|
2.28
|
|
MTM adjustments for fuel hedges recorded in periods other than the settlement period
|
(0.24
|
)
|
—
|
|
|
(0.08
|
)
|
—
|
|
||||
Average price per fuel gallon, adjusted
|
$
|
3.05
|
|
$
|
2.29
|
|
|
$
|
3.03
|
|
$
|
2.28
|
|
(1)
|
Includes fuel expense incurred under contract carriers arrangements.
|
(2)
|
Includes the impact of fuel hedge activity.
|
|
Three Months Ending December 31, 2011
|
|
Year Ending December 31, 2012
|
Fuel Hedge Margin (Posted to) Received from Counterparties
|
||||||||||||||||||
(in millions)
|
Decrease (Increase) to Unhedged Fuel Cost
(1)
|
Hedge Gain (Loss)
(2)
|
Net Impact
|
|
Decrease (Increase) to Unhedged Fuel Cost
(1)
|
Hedge Gain (Loss)
(2)
|
Net Impact
|
|||||||||||||||
+ 20%
|
$
|
(510
|
)
|
$
|
190
|
|
$
|
(320
|
)
|
|
$
|
(2,070
|
)
|
$
|
240
|
|
$
|
(1,830
|
)
|
$
|
60
|
|
- 20%
|
510
|
|
(390
|
)
|
120
|
|
|
2,070
|
|
(330
|
)
|
1,740
|
|
(660
|
)
|
(1)
|
Projections based upon the (increase) decrease to unhedged fuel cost as compared to the jet fuel price per gallon of $2.83, excluding transportation costs and taxes, at September 30, 2011 and estimated fuel consumption of 905 million and 3.8 billion gallons for the three months ending December 31, 2011 and year ending December 31, 2012, respectively.
|
(2)
|
Projections based on average futures prices by contract settlement month compared to futures prices at September 30, 2011.
|
Atlanta, Georgia
|
/s/ Ernst & Young LLP
|
October 25, 2011
|
|
|
Total Number of Shares Purchased
(1)
|
Average Price Paid Per Share
|
Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs
(1)
|
Maximum Number (or Approximate Dollar Value) of Shares That May Yet Be Purchased Under the Plan or Programs
|
||||
July 1-31, 2011
|
4,800
|
|
$
|
8.53
|
|
4,800
|
|
(1)
|
August 1-31, 2011
|
—
|
|
$
|
—
|
|
—
|
|
(1)
|
September 1-30, 2011
|
5,339
|
|
$
|
7.51
|
|
5,339
|
|
(1)
|
Total
|
10,139
|
|
|
10,139
|
|
|
(1)
|
Shares were withheld from employees to satisfy certain tax withholding obligations due in connection with grants of stock under our 2007 Performance Compensation Plan. The 2007 Performance Compensation Plan provides for the withholding of shares to satisfy tax obligations. It does not specify a maximum number of shares that can be withheld for this purpose.
|
10.1
|
Supplemental Agreement No. 13 to Purchase Agreement Number 2022, dated August 24, 2011, between The Boeing Company and Delta relating to Boeing Model 737NG Aircraft (the “B-737NG Purchase Agreement”)
**
|
10.2
|
Letter Agreements, dated August 24, 2011, relating to the B-737NG Purchase Agreement
**
|
10.3(a)
|
Aircraft General Terms Agreement, dated October 21, 1997, between Boeing and Delta (filed as Exhibit 10.6 to Delta's Quarterly Report on Form 10-Q for the quarter ended December 31, 1997)
* / **
|
10.3(b)
|
Letter Agreement, dated August 24, 2011, relating to Revisions to Aircraft General Terms Agreement dated October 21, 1997 and the B-737NG Purchase Agreement
**
|
15
|
Letter from Ernst & Young LLP regarding unaudited interim financial information
|
31.1
|
Certification by Delta's Chief Executive Officer with respect to Delta's Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2011
|
31.2
|
Certification by Delta's Senior Vice President and Chief Financial Officer with respect to Delta's Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2011
|
32
|
Certification pursuant to Section 1350 of Chapter 63 of Title 18 of the United States Code by Delta's Chief Executive Officer and Senior Vice President and Chief Financial Officer with respect to Delta's Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2011
|
101.INS
|
XBRL Instance Document
|
101.SCH
|
XBRL Taxonomy Extension Schema Document
|
101.CAL
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
101.DEF
|
XBRL Taxonomy Extension Definition Linkbase Document
|
101.LAB
|
XBRL Taxonomy Extension Labels Linkbase Document
|
101.PRE
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
|
Delta Air Lines, Inc.
|
|
(Registrant)
|
|
|
|
/s/ H
ANK
H
ALTER
|
|
Hank Halter
|
|
Senior Vice President and Chief Financial Officer
|
|
(Principal Financial and Accounting Officer)
|
October 25, 2011
|
|
|
TABLE OF CONTENTS
|
|
ARTICLES
|
|
SA
NUMBER
|
1
|
Quantity, Model and Description
|
|
2
|
Delivery Schedule
|
|
3
|
Price
|
|
4
|
Payment
|
|
5
|
Miscellaneous
|
|
TABLE
|
|
|
1Q.
|
Aircraft Delivery, Description, Price and Advance Payments
|
SA‑13
|
2A.
|
[***]
(intentionally deleted)
|
SA‑13, Article 3
|
EXHIBITS
|
|
|
A.
|
Aircraft Configuration for 737‑832 Aircraft
|
SA‑8
|
A2.
|
Aircraft Configuration for 737‑732 Aircraft
|
SA‑9
|
A3.
|
Aircraft Configuration for 737‑732 Aircraft
|
SA‑9
|
A4.
|
Revised Aircraft Configuration for 737‑832 Aircraft
|
SA‑12
|
A5.
|
Aircraft Configuration for 737‑932ER Aircraft
|
SA‑13
|
D2.
|
Escalation Adjustment
|
SA‑8
|
SUPPLEMENTAL EXHIBITS
|
|
|
BFE.
|
Buyer Furnished Equipment Variables
|
SA‑8
|
BFE1.
|
Buyer Furnished Equipment Variables
|
SA‑8
|
BFE2.
|
Buyer Furnished Equipment Variables for 737NG
|
SA‑13
|
CS1.
|
Customer Support Variables
|
|
CS2.
|
Customer Support Variables for 737‑700 Aircraft
|
SA‑8
|
CS3
|
Customer Support Variables for 737‑900ER Aircraft
|
SA‑13
|
EE1.
|
Engine Escalation
|
|
[***]
|
[***]
|
[***]
|
SLP1.
|
Service Life Policy Components
|
|
|
TABLE OF CONTENTS, continued
|
|
LETTER AGR
EEMENTS
|
|
SA
NUMBER
|
6‑1162‑RLL‑2147
|
Airframe Maintenance Cost Protection Program
|
|
6‑1162‑RLL‑2191
|
Multiple Aircraft Operating Weights
|
|
6‑1162‑RLL‑2198
|
Delivery Price Adjustment
|
|
6‑1162‑RLL‑2233
|
Aircraft Performance Guarantees for 737‑632, 732 and 832 Aircraft
|
|
6‑1162‑RLL‑2234R7
|
Special Matters
|
SA‑13
|
[***]
|
[***]
|
[***]
|
6‑1162‑RLL‑2241
|
Promotion Support
|
SA‑13, Article 7
|
6‑1162‑RLL‑2242
|
1997 and 1998 Escalation Sharing
|
|
[***]
|
[***]
|
|
6‑1162‑RLL‑2244
|
Performance Retention Commitment
|
|
6‑1162‑RLL‑2245
|
Certain Contractual Matters
(intentionally deleted)
|
SA‑13
|
6‑1162‑RLL‑2247
|
[***]
|
SA‑13,
[***]
|
6‑1162‑RLL‑3709
|
[***]
|
SA‑13,
[***]
|
6‑1162‑RLL‑2251
|
Total Cost Team
|
|
6‑1162‑RLL‑2400
|
Open Configuration Matters
|
|
6‑1162‑RLL‑2424R1
|
Engine Matters
|
|
6‑1162‑KSW‑6090
|
Performance Guarantees 737‑732 Aircraft
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
6‑1162‑KSW‑6238
|
Aircraft Performance Guarantees for 737‑732 Aircraft
|
SA‑9
|
6‑1162‑MMO‑0480
|
Aircraft Performance Guarantees for 737‑832 Aircraft
|
SA‑11
|
DAL‑PA‑02022‑LA‑1104472
|
Revision to AGTA‑DAL Terms
|
SA‑13
|
|
TABLE OF CONTENTS, continued
|
|
LETTER AGR
EEMENTS
|
|
SA
NUMBER
|
[***]
|
[***]
|
SA‑13
|
DAL‑PA‑2022‑LA-1104482
|
[***] for 737‑932ER Aircraft
|
SA‑13
|
DAL‑PA‑2022‑LA‑1104483
|
[***] Guarantee
|
SA-13
|
DAL‑PA‑2022‑LA‑1104484
|
Open Configuration Matters for 737‑932ER Aircraft
|
SA-13
|
DAL‑PA‑02022‑LA‑1104485
|
[***] Guarantees for 737‑932ER Aircraft
|
SA-13
|
DAL-PA-2022-LA-1105848
|
Agreement for [***]
|
SA-13
|
DAL‑PA‑2022‑LA‑1104487
|
[***]
|
SA-13
|
DAL-PA-2022-LA-1105850
|
[***]
|
SA-13
|
DAL-PA-2022-LA-1105858
|
Option Aircraft
|
SA-13
|
DAL-PA-2022-LA-1105843
|
[***]
|
SA-13
|
DAL-PA-2022-LA-1105849
|
[***]
|
SA-13
|
DAL-PA-2022-LA-1104480
|
[***]
|
SA-13
|
Supplemental Exhibit
|
Title
|
[***]
|
[***]
|
Letter Agreements
|
Title
|
6‑1162‑RLL‑2241
|
Promotional Support
|
[***]
|
[***]
|
[***]
|
[***]
|
delta air lines, inc.
By
/s/ Nathaniel Pieper
Its
Vice President -
Fleet Strategy & Transactions
|
THE BOEING COMPANY
By
/s/ Mark Orenstein
Its
Attorney-in-Fact
|
Airframe Model/MTOW:
|
737-900ER
|
[***]
|
|
Detail Specification:
|
|
|
[***]
|
|
Engine Model/Thrust:
|
CFM56-7B26
|
[***]
|
|
Airframe Price Base Year/Escalation Formula:
|
Jul-10
|
[***]
|
||
Airframe Price:
|
|
[***]
|
|
Engine Price Base Year/Escalation Formula:
|
[***]
|
[***]
|
||
Optional Features:
|
|
[***]
|
|
|
|
|
|
|
Sub-Total of Airframe and Features:
|
[***]
|
|
Airframe Escalation Data:
|
|
|
|
||
Engine Price (Per Aircraft):
|
|
[***]
|
|
Base Year Index (ECI):
|
|
[***]
|
|
|
Aircraft Basic Price (Excluding BFE/SPE):
|
[***]
|
|
Base Year Index (CPI):
|
|
[***]
|
|
||
Buyer Furnished Equipment (BFE) Estimate:
|
[***]
|
|
|
|
|
|
|
|
Seller Purchased Equipment (SPE) Estimate:
|
[***]
|
|
|
|
|
|
|
|
Deposit per Aircraft:
|
|
[***]
|
|
|
|
|
|
|
|
|
Escalation
|
|
|
Escalation Estimate
|
[***](Amts. Due/Mos. Prior to Delivery):
|
|||
Delivery
|
Number of
|
Factor
|
|
|
Adv Payment Base
|
[***]
|
[***]
|
[***]
|
[***]
|
Date
|
Aircraft
|
(Airframe)
|
|
|
Price Per A/P
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
Airframe Model/MTOW:
|
737-900ER
|
[***]
|
|
Detail Specification:
|
|
|
[***]
|
|
Engine Model/Thrust:
|
CFM56-7B26
|
[***]
|
|
Airframe Price Base Year/Escalation Formula:
|
Jul-10
|
[***]
|
||
Airframe Price:
|
|
[***]
|
|
Engine Price Base Year/Escalation Formula:
|
[***]
|
[***]
|
||
Optional Features:
|
|
[***]
|
|
|
|
|
|
|
Sub-Total of Airframe and Features:
|
[***]
|
|
Airframe Escalation Data:
|
|
|
|
||
Engine Price (Per Aircraft):
|
|
[***]
|
|
Base Year Index (ECI):
|
|
[***]
|
|
|
Aircraft Basic Price (Excluding BFE/SPE):
|
[***]
|
|
Base Year Index (CPI):
|
|
[***]
|
|
||
Buyer Furnished Equipment (BFE) Estimate:
|
[***]
|
|
|
|
|
|
|
|
Seller Purchased Equipment (SPE) Estimate:
|
[***]
|
|
|
|
|
|
|
|
Deposit per Aircraft:
|
|
[***]
|
|
|
|
|
|
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
Airframe Model/MTOW:
|
737-900ER
|
[***]
|
|
Detail Specification:
|
|
|
[***]
|
|
Engine Model/Thrust:
|
CFM56-7B26
|
[***]
|
|
Airframe Price Base Year/Escalation Formula:
|
Jul-10
|
[***]
|
||
Airframe Price:
|
|
[***]
|
|
Engine Price Base Year/Escalation Formula:
|
[***]
|
[***]
|
||
Optional Features:
|
|
[***]
|
|
|
|
|
|
|
Sub-Total of Airframe and Features:
|
[***]
|
|
Airframe Escalation Data:
|
|
|
|
||
Engine Price (Per Aircraft):
|
|
[***]
|
|
Base Year Index (ECI):
|
|
[***]
|
|
|
Aircraft Basic Price (Excluding BFE/SPE):
|
[***]
|
|
Base Year Index (CPI):
|
|
[***]
|
|
||
Buyer Furnished Equipment (BFE) Estimate:
|
[***]
|
|
|
|
|
|
|
|
Seller Purchased Equipment (SPE) Estimate:
|
[***]
|
|
|
|
|
|
|
|
Deposit per Aircraft:
|
|
[***]
|
|
|
|
|
|
|
|
|
Escalation
|
|
|
Escalation Estimate
|
[***](Amts. Due/Mos. Prior to Delivery):
|
|||
Delivery
|
Number of
|
Factor
|
|
|
Adv Payment Base
|
[***]
|
[***]
|
[***]
|
[***]
|
Date
|
Aircraft
|
(Airframe)
|
|
|
Price Per A/P
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
Airframe Model/MTOW:
|
737-900ER
|
[***]
|
|
Detail Specification:
|
|
|
[***]
|
|
Engine Model/Thrust:
|
CFM56-7B26
|
[***]
|
|
Airframe Price Base Year/Escalation Formula:
|
Jul-10
|
[***]
|
||
Airframe Price:
|
|
[***]
|
|
Engine Price Base Year/Escalation Formula:
|
[***]
|
[***]
|
||
Optional Features:
|
|
[***]
|
|
|
|
|
|
|
Sub-Total of Airframe and Features:
|
[***]
|
|
Airframe Escalation Data:
|
|
|
|
||
Engine Price (Per Aircraft):
|
|
[***]
|
|
Base Year Index (ECI):
|
|
[***]
|
|
|
Aircraft Basic Price (Excluding BFE/SPE):
|
[***]
|
|
Base Year Index (CPI):
|
|
[***]
|
|
||
Buyer Furnished Equipment (BFE) Estimate:
|
[***]
|
|
|
|
|
|
|
|
Seller Purchased Equipment (SPE) Estimate:
|
[***]
|
|
|
|
|
|
|
|
Deposit per Aircraft:
|
|
[***]
|
|
|
|
|
|
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
Airframe Model/MTOW:
|
737-900ER
|
[***]
|
|
Detail Specification:
|
|
|
[***]
|
|
Engine Model/Thrust:
|
CFM56-7B26
|
[***]
|
|
Airframe Price Base Year/Escalation Formula:
|
Jul-10
|
[***]
|
||
Airframe Price:
|
|
[***]
|
|
Engine Price Base Year/Escalation Formula:
|
[***]
|
[***]
|
||
Optional Features:
|
|
[***]
|
|
|
|
|
|
|
Sub-Total of Airframe and Features:
|
[***]
|
|
Airframe Escalation Data:
|
|
|
|
||
Engine Price (Per Aircraft):
|
|
[***]
|
|
Base Year Index (ECI):
|
|
[***]
|
|
|
Aircraft Basic Price (Excluding BFE/SPE):
|
[***]
|
|
Base Year Index (CPI):
|
|
[***]
|
|
||
Buyer Furnished Equipment (BFE) Estimate:
|
[***]
|
|
|
|
|
|
|
|
Seller Purchased Equipment (SPE) Estimate:
|
[***]
|
|
|
|
|
|
|
|
Deposit per Aircraft:
|
|
[***]
|
|
|
|
|
|
|
|
|
Escalation
|
|
|
Escalation Estimate
|
[***](Amts. Due/Mos. Prior to Delivery):
|
|||
Delivery
|
Number of
|
Factor
|
|
|
Adv Payment Base
|
[***]
|
[***]
|
[***]
|
[***]
|
Date
|
Aircraft
|
(Airframe)
|
|
|
Price Per A/P
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
Airframe Model/MTOW:
|
737-900ER
|
[***]
|
|
Detail Specification:
|
|
|
[***]
|
|
Engine Model/Thrust:
|
CFM56-7B26
|
[***]
|
|
Airframe Price Base Year/Escalation Formula:
|
Jul-10
|
[***]
|
||
Airframe Price:
|
|
[***]
|
|
Engine Price Base Year/Escalation Formula:
|
[***]
|
[***]
|
||
Optional Features:
|
|
[***]
|
|
|
|
|
|
|
Sub-Total of Airframe and Features:
|
[***]
|
|
Airframe Escalation Data:
|
|
|
|
||
Engine Price (Per Aircraft):
|
|
[***]
|
|
Base Year Index (ECI):
|
|
[***]
|
|
|
Aircraft Basic Price (Excluding BFE/SPE):
|
[***]
|
|
Base Year Index (CPI):
|
|
[***]
|
|
||
Buyer Furnished Equipment (BFE) Estimate:
|
[***]
|
|
|
|
|
|
|
|
Seller Purchased Equipment (SPE) Estimate:
|
[***]
|
|
|
|
|
|
|
|
Deposit per Aircraft:
|
|
[***]
|
|
|
|
|
|
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
1.
|
Supplier Selection
.
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
|
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[***]
|
[***]
|
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[***]
|
[***]
|
2.
|
On-dock Dates and Other Information
.
|
3.
|
Additional Delivery Requirements - Import
.
|
[***]
|
[***]
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|
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|
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|
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|
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|
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|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
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|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
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|
[***]
|
[***]
|
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[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
1.
|
Maintenance Training
.
|
2.
|
Flight Training
.
|
3.
|
Planning Assistance
.
|
4.
|
Technical Data and Documents
.
|
Reference:
|
Purchase Agreement Nos. 2022 and 2026 (the
Purchase Agreement
) between The Boeing Company (Boeing) and Delta Air Lines, Inc. (
Customer
) relating to 737‑632/‑732/‑832
/‑932ER,
777‑232IGW and 777‑232LR aircraft (the Aircraft).
|
Subject:
|
[***]
|
References: 1)
|
Purchase Agreement No. PA‑02022 (
Purchase Agreement
) between The Boeing Company (
Boeing
) and Delta Air Lines, Inc. (
Customer
) relating to Model 737‑732/‑832/‑932ER‑ aircraft (
Aircraft
); and
|
2)
|
Aircraft General Terms Agreement AGTA‑DAL dated October 21, 1997 (
AGTA
)
|
1.
|
[***]
|
7.
|
Confidential Treatment
.
|
THE BOEING COMPANY
|
||
|
||
By
|
/s/ Mark Orenstein
|
|
|
||
Its
|
Attorney‑In‑Fact
|
|
|
||
ACCEPTED AND AGREED TO this
|
||
|
||
Date:
|
August 24, 2011
|
|
|
||
Delta Air Lines, Inc.
|
||
|
||
By:
|
/s/ Nathaniel Pieper
|
|
|
||
Its:
|
Vice President - Fleet Strategy & Transactions
|
Subject:
|
[***]
|
Reference:
|
Purchase Agreement No. PA-02022 (
Purchase Agreement
) between The Boeing Company (
Boeing
) and Delta Air Lines, Inc. (
Customer
) relating to Model 737-900ER aircraft with Winglets (
Aircraft
)
|
1.
|
[***]
|
9.
|
[***]
|
10.
|
Assignment
.
|
11.
|
Confidential Treatment
.
|
THE BOEING COMPANY
|
||
|
||
By
|
/s/ Mark Orenstein
|
|
|
||
Its
|
Attorney-In-Fact
|
|
|
||
ACCEPTED AND AGREED TO this
|
||
|
||
Date:
|
August 24, 2011
|
|
|
||
Delta Air Lines, Inc.
|
||
|
||
By
|
/s/ Nathaniel Pieper
|
|
|
||
Its
|
Vice President - Fleet Strategy & Transactions
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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Subject:
|
[***] Guarantee
|
Reference:
|
Purchase Agreement No. PA-02022 (
Purchase Agreement
) between The Boeing Company (
Boeing
) and Delta Air Lines, Inc. (
Customer
) relating to Model 737-900ER aircraft (
Aircraft
)
|
THE BOEING COMPANY
|
||
|
||
By
|
/s/ Mark Orenstein
|
|
|
||
Its
|
Attorney-In-Fact
|
|
|
||
ACCEPTED AND AGREED TO this
|
||
|
||
Date:
|
August 24, 2011
|
|
|
||
DELTA AIR LINES, INC.
|
||
|
||
By
|
/s/ Nathaniel Pieper
|
|
|
||
Its
|
Vice President - Fleet Strategy & Transactions
|
[***]
|
|||||
[***]
|
[***]
|
[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
|
[***]
|
[***]
|
|
|
|
|
|
|
|
|
Reference:
|
Letter Agreement No. DAL-PA-02022-LA-1104483 to Agreement No. PA-02022 (
Purchase Agreement
) [***]
|
Subject:
|
Data reported pursuant to Article 6 of the referenced Letter Agreement.
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
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[***]
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[***]
|
|
[***]
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|
[***]
|
|
[***]
|
|
[***]
|
|
[***]
|
|
Delta Air Lines, Inc.
|
|
|
|
By
|
|
|
|
Its
|
|
Reference:
|
Letter Agreement No. DAL-PA-02022-LA-1104483 to Agreement No. PA-02022 (
Purchase Agreement
) and [***]
|
Subject:
|
Data reported pursuant to Article 7 of the referenced Letter Agreement.
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
|
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|
[***]
|
[***]
|
[***]
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[***]
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[***]
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[***]
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[***]
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[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|||||
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|||||
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
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[***]
|
[***]
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[***]
|
[***]
|
[***]
|
[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
|
[***]
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[***]
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[***]
|
[***]
|
[***]
|
[***]
|
|||||
[***]
|
[***]
|
[***]
|
[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
|
[***]
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[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|||||
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|||||
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
THE BOEING COMPANY
|
|
|
|
Reported By
|
|
|
|
Its
|
|
|
|
Date
|
|
Reference:
|
Letter Agreement No. DAL-PA-02022-LA-1104483 to Agreement No. PA-02022 (
Purchase Agreement
) and [***]
|
Subject:
|
Data reported pursuant to Article 5.3 of the referenced Letter Agreement.
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
Subject:
|
Open Configuration Matters
|
Reference:
|
Purchase Agreement No. PA-02022 (
Purchase Agreement
) between The Boeing Company (
Boeing
) and Delta Air Lines, Inc. (
Customer
) relating to Model 737-732/-832/-932ER aircraft
|
THE BOEING COMPANY
|
||
|
||
By
|
/s/ Mark Orenstein
|
|
|
||
Its
|
Attorney-In-Fact
|
|
|
||
ACCEPTED AND AGREED TO this
|
||
|
||
Date:
|
August 24, 2011
|
|
|
||
DELTA AIR LINES, INC.
|
||
|
||
By:
|
/s/ Nathaniel Pieper
|
|
|
||
Its:
|
Vice President - Fleet Strategy & Transactions
|
Subject:
|
[***] Guarantees
|
Reference:
|
Purchase Agreement No. PA-2022 (
Purchase Agreement
) between The Boeing Company (
Boeing
) and Delta Air Lines, Inc. (
Customer
) relating to Model
737-732/-832/-932
aircraft.
|
THE BOEING COMPANY
|
||
|
||
By
|
/s/ Mark Orenstein
|
|
|
||
Its
|
Attorney-In-Fact
|
|
|
||
ACCEPTED AND AGREED TO this
|
||
|
||
Date:
|
August 24, 2011
|
|
|
||
Delta Air Lines, Inc.
|
||
|
||
By
|
/s/ Nathaniel Pieper
|
|
|
||
Its
|
Vice President - Fleet Strategy & Transactions
|
Subject:
|
Agreement for [***]
|
Reference:
|
Purchase Agreement No. PA-02022 (
Purchase Agreement
) between The Boeing Company (
Boeing
) and Delta Air Lines, Inc. (
Customer
) relating to Model
737-732/-832/-932
aircraft.
|
THE BOEING COMPANY
|
||
|
||
By
|
/s/ Mark Orenstein
|
|
|
||
Its
|
Attorney-In-Fact
|
|
|
||
ACCEPTED AND AGREED TO this
|
||
|
||
Date:
|
August 24, 2011
|
|
|
||
DELTA AIR LINES, INC.
|
||
|
||
By
|
/s/ Nathaniel Pieper
|
|
|
||
Its
|
Vice President - Fleet Strategy & Transactions
|
Subject:
|
[***]
|
Reference:
|
Purchase Agreement No. PA-02022 (
Purchase Agreement
) between The Boeing Company (
Boeing
) and Delta Air Lines, Inc. (
Customer
) relating to Model 737-900ER aircraft (
Aircraft
)
|
THE BOEING COMPANY
|
||
|
||
By
|
/s/ Mark Orenstein
|
|
|
||
Its
|
Attorney-In-Fact
|
|
|
||
ACCEPTED AND AGREED TO this
|
||
|
||
Date:
|
August 24, 2011
|
|
|
||
DELTA AIR LINES, INC.
|
||
|
||
By
|
/s/ Nathaniel Pieper
|
|
|
||
Its
|
Vice President - Fleet Strategy & Transactions
|
Subject:
|
[***]
|
Reference:
|
Purchase Agreement No. 2022 (
Purchase Agreement
) between The Boeing Company (
Boeing
) and Delta Air Lines, Inc. (
Customer
) relating to Model 737-732/-832/-932ER aircraft (
Aircraft
)
|
THE BOEING COMPANY
|
||
|
||
By
|
/s/ Mark Orenstein
|
|
|
||
Its
|
Attorney-In-Fact
|
|
|
||
ACCEPTED AND AGREED TO this
|
||
|
||
Date:
|
August 24, 2011
|
|
|
||
DELTA AIR LINES, INC.
|
||
|
||
By
|
/s/ Nathaniel Pieper
|
|
|
||
Its
|
Vice President - Fleet Strategy & Transactions
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
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|
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|
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|
[***]
|
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|
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|
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|
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|
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|
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|
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|
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|
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|
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|
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|
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|
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|
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|
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|
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|
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|
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|
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|
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|
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|
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|
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|
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|
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|
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|
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|
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|
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|
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|
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|
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|
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|
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|
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|
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|
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|
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|
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|
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|
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|
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|
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|
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|
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|
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|
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|
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|
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|
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|
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|
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|
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|
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|
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|
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|
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|
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|
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|
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|
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|
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|
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|
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|
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|
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|
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|
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|
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|
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|
[***]
|
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|
[***]
|
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|
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|
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|
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|
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|
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|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
Subject:
|
Option Aircraft
|
Reference:
|
Purchase Agreement No. PA-02022 (
Purchase Agreement
) between The Boeing Company (
Boeing
) and Delta Air Lines, Inc. (
Customer
) relating to Model 737-900ER aircraft (
Aircraft
)
|
THE BOEING COMPANY
|
||
|
||
By
|
/s/ Mark Orenstein
|
|
|
||
Its
|
Attorney-In-Fact
|
|
|
||
ACCEPTED AND AGREED TO this
|
||
|
||
Date:
|
August 24, 2011
|
|
|
||
Delta Air Lines, Inc.
|
||
|
||
By
|
/s/ Nathaniel Pieper
|
|
|
||
Its
|
Vice President - Fleet Strategy & Transactions
|
Airframe Model/MTOW:
|
737-900ER
|
[***]
|
|
Detail Specification:
|
|
|
|
|
[***]
|
4Q10 External Fcst
|
|
|
Engine Model/Thrust:
|
CFM56-7B26
|
[***]
|
|
Airframe Price Base Year/Escalation Formula:
|
|
|
[***]
|
[***]
|
||||
Airframe Price:
|
|
[***]
|
|
Engine Price Base Year/Escalation Formula:
|
|
|
N/A
|
[***]
|
||||
Optional Features:
|
|
[***]
|
|
|
|
|
|
|
|
|
|
|
Sub-Total of Airframe and Features:
|
[***]
|
|
Airframe Escalation Data:
|
|
|
|
|
|
|
|||
Engine Price (Per Aircraft):
|
|
[***]
|
|
Base Year Index (ECI):
|
|
|
|
[***]
|
|
|
||
Aircraft Basic Price (Excluding BFE/SPE):
|
[***]
|
|
Base Year Index (CPI):
|
|
|
|
[***]
|
|
|
|||
Buyer Furnished Equipment (BFE) Estimate:
|
[***]
|
|
|
|
|
|
|
|
|
|
||
Seller Purchased Equipment (SPE) Estimate:
|
[***]
|
|
|
|
|
|
|
|
|
|
||
[***]
|
|
|
[***]
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Escalation
|
|
|
Escalation Estimate
|
[***] (Amts. Due/Mos. Prior to Delivery):
|
|
|
|
|
|
|
Delivery
|
Number of
|
Factor
|
|
|
Adv Payment Base
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
Date
|
Aircraft
|
(Airframe)
|
|
|
Price Per A/P
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
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|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
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|
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|
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|
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|
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|
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|
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|
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|
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|
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|
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|
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|
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|
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[***]
|
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|
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|
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|
[***]
|
[***]
|
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|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
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|
[***]
|
[***]
|
[***]
|
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|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
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[***]
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[***]
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|
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[***]
|
[***]
|
[***]
|
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|
[***]
|
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|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
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|
[***]
|
[***]
|
[***]
|
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|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
[***]
|
[***]
|
[***]
|
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|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
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|
[***]
|
[***]
|
[***]
|
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|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
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|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
[***]
|
[***]
|
[***]
|
|
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
|
Subject:
|
[***]
|
Reference:
|
Purchase Agreement No. PA-02022 (
Purchase Agreement
) between The Boeing Company (
Boeing
) and Delta Air Lines, Inc. (
Customer
) relating to Model 737-900ER aircraft (
Aircraft
)
|
THE BOEING COMPANY
|
||
|
||
By
|
/s/ Mark Orenstein
|
|
|
||
Its
|
Attorney-In-Fact
|
|
|
||
ACCEPTED AND AGREED TO this
|
||
|
||
Date:
|
August 24, 2011
|
|
|
||
Delta Air Lines, Inc.
|
||
|
||
By
|
/s/ Nathaniel Pieper
|
|
|
||
Its
|
Vice President - Fleet Strategy & Transactions
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
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[***]
|
[***]
|
[***]
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[***]
|
[***]
|
[***]
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[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
[***]
|
Subject:
|
[***]
|
Reference:
|
Purchase Agreement No. PA‑02022 (
Purchase Agreement
) between The Boeing Company (
Boeing
) and Delta Air Lines, Inc. (
Customer
) relating to Model 737‑732/‑832/‑932ER aircraft
|
2.
|
[***]
|
3.
|
[***]
|
THE BOEING COMPANY
|
||
|
||
By
|
/s/ Mark Orenstein
|
|
|
||
Its
|
Attorney-In-Fact
|
|
|
||
ACCEPTED AND AGREED TO this
|
||
|
||
Date:
|
August 24, 2011
|
|
|
||
DELTA AIR LINES, INC.
|
||
|
||
By
|
/s/ Nathaniel Pieper
|
|
|
||
Its
|
Vice President - Fleet Strategy & Transactions
|
References: (1)
|
Letter Agreement 6‑1162‑RLL‑2245, entitled “
Certain Contractual Matters
” [***], between The Boeing Company (
Boeing
) and Delta Air Lines, Inc. (
Customer
).
|
(2)
|
Purchase Agreement Nos. 2022, 2023, 2024, 2025, and 2026 (the
Purchase Agreements
) between Boeing and Customer relating to Model 737-632/-732/-832/-932ER, 757-232, 767-332/332ER, 767-432, and 777-232IGW/-232ER/-232LR/-300ER aircraft, respectively.
|
(3)
|
Aircraft General Terms Agreement, dated as of October 21, 1997, between Boeing and Customer, identified as AGTA‑DAL (
AGTA
).
|
Recitals: (1)
|
[***]
|
(2)
|
[***]
|
(3)
|
[***]
|
8.
|
Effectiveness
.
|
Subject:
|
Revisions to Aircraft General Terms Agreement AGTA-DAL dated October 21, 1997 (
AGTA
) Terms
|
Reference:
|
Purchase Agreement Nos. 2022, 2023, 2024, 2025 and 2026 (the
Purchase Agreements
) between The Boeing Company (
Boeing
) and Delta Air Lines, Inc. (
Customer
) relating to Model 737-632/-732/-832/-932ER, 757-232, 767-332/332ER, 767-432, 777-232IGW/-232ER/-232LR aircraft (
Aircraft
)
|
1.
|
The 737-600 is no longer offerable under this Purchase Agreement. All references to the 737-600 are hereby deleted and shall be deemed to be of no further effect.
|
2.
|
Article 1,
Definitions, Subject Matter of Sale and Annual Fleet Plan Review
is amended as follows:
|
THE BOEING COMPANY
|
||
|
||
By
|
/s/ Mark Orenstein
|
|
|
||
Its
|
Attorney-In-Fact
|
|
|
||
ACCEPTED AND AGREED TO this
|
||
|
||
Date:
|
August 24, 2011
|
|
|
||
DELTA AIR LINES, INC.
|
||
|
||
By:
|
/s/ Nathaniel Pieper
|
|
|
||
Its:
|
Vice President - Fleet Strategy & Transactions
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Delta Air Lines, Inc. (“Delta”) for the quarterly period ended
September 30, 2011
;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material 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(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for Delta and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to Delta, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of Delta's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in Delta's internal control over financial reporting that occurred during Delta's most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, Delta's internal control over financial reporting; and
|
5.
|
Delta's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to Delta's auditors and the Audit Committee of Delta's Board of Directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect Delta's ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in Delta's internal control over financial reporting.
|
October 25, 2011
|
/s/ Richard H. Anderson
|
|
Richard H. Anderson
|
|
Chief Executive Officer
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Delta Air Lines, Inc. (“Delta”) for the quarterly period ended
September 30, 2011
;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material 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(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for Delta and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to Delta, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of Delta's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in Delta's internal control over financial reporting that occurred during Delta's most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, Delta's internal control over financial reporting; and
|
5.
|
Delta's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to Delta's auditors and the Audit Committee of Delta's Board of Directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect Delta's ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in Delta's internal control over financial reporting.
|
October 25, 2011
|
/s/ Hank Halter
|
|
Hank Halter
|
|
Senior Vice President and
Chief Financial Officer
|
1.
|
such Report fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934; and
|
2.
|
the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of Delta.
|
|
/s/ Richard H. Anderson
|
|
Richard H. Anderson
|
|
Chief Executive Officer
|
|
|
|
/s/ Hank Halter
|
|
Hank Halter
|
|
Senior Vice President and
Chief Financial Officer
|
|
|