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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF
THE SECURITIES EXCHANGE ACT OF 1934
FOR THE FISCAL YEAR ENDED JUNE 30, 1997
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF
THE SECURITIES EXCHANGE ACT OF 1934
COMMISSION FILE NUMBER 1-5424
DELTA AIR LINES, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 58-0218548
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
HARTSFIELD ATLANTA INTERNATIONAL AIRPORT 30320
ATLANTA, GEORGIA (Zip Code)
(Address of principal executive offices)
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA (404) 715-2600
CODE:
SECURITIES REGISTERED PURSUANT TO SECTION 12(B) OF THE ACT:
NAME OF EACH EXCHANGE ON
TITLE OF EACH CLASS WHICH REGISTERED
Common Stock, par value $3.00 per share New York Stock Exchange
Preferred Stock Purchase Rights New York Stock Exchange
SECURITIES REGISTERED PURSUANT TO SECTION 12(G) OF THE ACT:
None
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes [X] No [ ]
Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [ ]
The aggregate market value of the voting and non-voting common equity held
by non-affiliates of the registrant as of August 29, 1997, was approximately
$6,367,210,000. As of August 29, 1997, 73,722,230 shares of the registrant's
common stock were outstanding.
DOCUMENTS INCORPORATED BY REFERENCE
Parts I and II of this Form 10-K incorporate by reference certain
information from the registrant's 1997 Annual Report to Stockholders. Part III
of this Form 10-K incorporates by reference certain information from the
registrant's definitive Proxy Statement dated September 15, 1997, for its Annual
Meeting of Stockholders to be held on October 23, 1997.
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DELTA AIR LINES, INC.
PART I
ITEM 1. BUSINESS
General Description
Delta Air Lines, Inc. ("Delta" or the "Company") is a major air carrier
providing scheduled air transportation for passengers, freight and mail over a
network of routes throughout the United States and abroad. Based on calendar
1996 data, Delta is the largest United States airline as measured by aircraft
departures and passengers enplaned, and the third largest United States airline
as measured by operating revenues and revenue passenger miles flown. As of
August 15, 1997, the Company served 149 domestic cities in 42 states, the
District of Columbia, Puerto Rico and the United States Virgin Islands, as well
as 41 cities in 25 foreign countries.
An important characteristic of Delta's domestic route system is its four
hub airports in Atlanta, Cincinnati, Dallas-Fort Worth and Salt Lake City. Each
of these hub operations includes Delta flights that gather and distribute
traffic from markets in the geographic region surrounding the hub to other major
cities and to other Delta hubs. These hubs also provide connecting passengers
with access to Delta's international gateway at New York's Kennedy Airport and
its Pacific gateway in Portland, Oregon.
Delta conducts operations in various foreign countries, principally in
North America, Europe and Asia. Operating revenues from the Company's foreign
operations were approximately $2.8 billion, $2.7 billion and $2.8 billion in the
years ended June 30, 1997, 1996 and 1995, respectively.
For the year ended June 30, 1997, passenger revenues accounted for 92% of
Delta's operating revenues. Cargo revenues, which include freight and mail,
accounted for 4% of Delta's operating revenues, and other sources accounted for
4% of the Company's operating revenues.
Delta's operating results for any interim period are not necessarily
indicative of operating results for an entire year because of seasonal
variations in the demand for air travel. In general, demand for air travel is
higher in the June and September quarters, particularly in international
markets, because there is more vacation travel during these periods than during
the remainder of the year. Demand for air travel, especially by leisure and
other discretionary customers, is also affected by factors such as general
economic conditions and fare levels.
Delta is incorporated under the laws of the State of Delaware. Its
principal executive offices are located at Hartsfield Atlanta International
Airport, Atlanta, Georgia 30320, and its telephone number is (404) 715-2600.
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Regulatory Environment
While the United States Department of Transportation (the "DOT") and the
Federal Aviation Administration (the "FAA") exercise regulatory authority over
air carriers under the Federal Aviation Act of 1958, as amended (the "Act"),
most domestic economic regulation of passenger and freight services was
eliminated pursuant to the Airline Deregulation Act of 1978 and other statutes
amending the Act. The DOT has jurisdiction over international tariffs and
pricing; international routes; computer reservations systems; and certain
economic and consumer protection matters such as advertising, denied boarding
compensation, baggage liability and smoking aboard aircraft. The FAA regulates
flying operations generally, including control of navigable air space, flight
personnel, aircraft certification and maintenance, and other matters affecting
air safety. The United States Department of Justice has jurisdiction over
airline competition matters, including mergers and acquisitions.
As a result of the economic deregulation of the industry, any air carrier
which the DOT finds "fit" to operate is given unrestricted authority to operate
domestic air transportation (including the carriage of passengers and cargo).
Authority to operate international routes continues to be regulated by the DOT
and by the foreign governments involved. International route awards are also
subject to the approval of the President of the United States for conformance
with national defense and foreign policy objectives.
The economic deregulation of the industry permits unfettered competition
with respect to domestic routes, services, fares and rates, and Delta faces
significant competition on its routes. Except for constraints imposed by the
Act's Essential Air Service provisions, which are applicable to certain small
communities, airlines may terminate service to a city without restriction.
The FAA has implemented a number of requirements which are incorporated
into Delta's maintenance programs. These matters relate to, among other things,
inspection and maintenance of aging aircraft, and corrosion control.
Delta is also subject to various other federal, state, local and foreign
laws and regulations. The United States Postal Service has authority over
certain aspects of the transportation of mail, and rates for the carriage of
domestic mail are determined through negotiations or competitive bidding. The
Communications Act of 1934, as amended, governs Delta's use and operation of
radio facilities. Labor relations in the airline industry are generally governed
by the Railway Labor Act. Environmental matters (including noise pollution) are
regulated by various federal, state and local governmental entities.
Fares and Rates
Airlines are permitted to set domestic ticket prices without governmental
regulation, and the industry is characterized by substantial price competition.
International fares and rates are subject to the jurisdiction of the DOT and
governments of the foreign countries involved. Most international markets are
characterized by significant price competition and substantial commissions,
overrides and discounts to travel agents, brokers and wholesalers.
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The system passenger mile yield declined 2% in fiscal 1997 compared to
fiscal 1996. The domestic passenger mile yield decreased 3%, reflecting the
Company's use of more competitive pricing strategies; the continued presence of
low-cost, low-fare carriers in domestic markets served by Delta; and the March
7, 1997 reimposition of the United States transportation excise tax. The
international passenger mile yield decreased 2%, due to the Company's use of
more competitive pricing strategies.
Delta expects that low-fare competition is likely to continue in domestic
and international markets. If price reductions are not offset by increases in
traffic or changes in the mix of traffic that improve the passenger mile yield,
Delta's operating results will be adversely affected.
Competition and Route Authority
All domestic routes served by Delta are subject to competition from both
new and existing carriers, and service over virtually all of Delta's domestic
routes is highly competitive. On most of its principal domestic routes, the
Company competes with at least one, and usually more than one, major airline.
Delta also competes with regional and national carriers, all-cargo carriers,
charter airlines and, particularly on its shorter routes, with surface
transportation. Service over most of Delta's international routes is also highly
competitive.
International alliances between foreign and domestic carriers, such as the
marketing and code-sharing arrangements between KLM-Royal Dutch Airlines and
Northwest Airlines, Inc., and among Lufthansa German Airlines, Scandinavian
Airline Systems and United Air Lines, Inc., have significantly increased
competition in international markets. A proposed marketing alliance between
British Airways Plc and American Airlines, Inc. is under review by United States
governmental authorities. Through code-sharing arrangements with United States
carriers, foreign carriers have obtained access to interior United States
passenger traffic. Similarly, United States carriers have increased their
ability to sell transatlantic services and destinations to and beyond European
cities.
On June 14, 1996, Delta, Swissair, Sabena and Austrian Airlines received
antitrust immunity from the DOT to pursue a global marketing alliance. The
alliance agreements, which were effective as of February 1, 1997, establish the
framework that allowed these four carriers to form a transatlantic air transport
system which links Delta's domestic system with the European hubs of Swissair,
Sabena and Austrian Airlines. The alliance enables the carriers to pursue a
coordinated approach to worldwide sales and marketing; common pricing and
inventory control; coordination of airline schedules and route planning; and the
pooling of revenues on certain code-share flights.
Delta's flight operations are authorized by certificates of public
convenience and necessity and, to a limited extent, by exemptions issued by the
DOT. The requisite approvals of other governments for international operations
are provided by bilateral agreements with, or permits issued by, foreign
countries. Because international air transportation is governed by bilateral or
other agreements between the United States and the foreign country or countries
involved, changes in United States or foreign government aviation policies could
result in the alteration or termination of such agreements, diminish the value
of Delta's international route authorities or
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otherwise affect Delta's international operations. Bilateral agreements between
the United States and various foreign countries served by Delta are subject to
renegotiation from time to time.
Certain of Delta's international route authorities are subject to periodic
renewal requirements. Delta requests extension of these authorities when and as
appropriate. While the DOT usually renews temporary authorities on routes where
the authorized carrier is providing a reasonable level of service, there is no
assurance of this result. Dormant authority may not be renewed in some cases,
especially where another United States carrier indicates a willingness to
provide service.
Code-Sharing
Delta has entered into marketing agreements with certain foreign carriers
to maintain or improve Delta's access to international markets. Under these dual
designator code-sharing arrangements, Delta and the foreign carriers publish
their respective airline designator codes on a single flight operation, thereby
allowing Delta and the foreign carrier to provide joint service with one
aircraft rather than operating separate services with two aircraft.
Most of Delta's international code-sharing arrangements operate in
discrete international city pairs. Delta purchases seats that are marketed under
Delta's "DL" designator code and sells seats that are marketed under foreign
carriers' two-letter designator code pursuant to code-sharing arrangements with
certain foreign airlines. In addition to its agreements with Swissair, Sabena
and Austrian Airlines, as of August 15, 1997, Delta had code-sharing agreements
with eleven foreign carriers.
Airport Access
Operations at four major United States and certain foreign airports served
by Delta are regulated by governmental entities through "slot" allocations. Each
slot represents the authorization to land at or take off from the particular
airport during a specified time period. In the United States, the FAA regulates
slot allocations at Kennedy Airport in New York, La Guardia Airport in New York,
National Airport in Washington, D. C., and O'Hare International Airport in
Chicago. The Delta Shuttle requires slot allocations at La Guardia and National
Airports, as do Delta's other operations at those four airports. Certain foreign
airports also have slot allocations.
Delta currently has sufficient slot authorizations to operate its existing
flights, and has generally been able to obtain slots to expand its operations
and to change its schedules. There is no assurance, however, that Delta will be
able to obtain slots for these purposes in the future because, among other
reasons, slot allocations are subject to changes in governmental policies.
Delta Express
On October 1, 1996, Delta began Delta Express, a low-fare,
leisure-oriented operation which provides service from certain cities in the
Northeast and Midwest to Orlando and four other
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Florida destinations. Delta Express operates a dedicated fleet of 25 B-737-200
aircraft. Effective October 1, 1997, Delta Express will offer 126 daily non-stop
flights to 16 cities.
The Delta Connection Program
Delta has marketing agreements with four air carriers serving principally
the following areas of the United States: Atlantic Southeast Airlines, Inc.
("ASA") operates in the Southeast through Atlanta and in the Southwest through
Dallas-Fort Worth; Business Express, Inc. operates in the Northeast through
Boston and New York; Comair, Inc. ("Comair") serves Florida and operates in the
Midwest through Cincinnati; and SkyWest Airlines, Inc. ("SkyWest") serves
California and operates in other western states through Salt Lake City. These
carriers, which are known as "Delta Connection" airlines, use Delta's "DL" code
on their flights and exchange connecting traffic with Delta. At June 30, 1997,
Delta held equity interests in ASA Holdings, Inc. (the parent of ASA), Comair
Holdings, Inc. (the parent of Comair) and SkyWest, Inc. (the parent of SkyWest)
of 27%, 21% and 15%, respectively.
Computer Reservation System Partnership
Delta owns 38% of WORLDSPAN, L.P. ("WORLDSPAN"), a Delaware limited
partnership which operates and markets a computer reservation system ("CRS") and
related systems for the travel industry. Northwest Airlines, Inc., Trans World
Airlines, Inc. and ABACUS Distribution Systems Pte Ltd. own 32%, 25% and 5%,
respectively, of WORLDSPAN.
CRS services are used primarily by travel agents to book airline, hotel,
car rental and other travel reservations and issue airline tickets. CRS services
are provided by several companies in the United States and worldwide. In the
United States, other CRS competitors are SABRE (owned primarily by AMR, Inc.),
Galileo International, Inc. (owned by United Air Lines, Inc., US Airways, Inc.
and certain foreign carriers) and AMADEUS (owned by Continental Airlines, Inc.,
and certain foreign carriers). CRS vendors are subject to regulations
promulgated by the DOT and certain foreign governments.
The CRS industry is highly competitive. Delta believes that, based on the
number of travel agents in the United States using a CRS, WORLDSPAN ranks third,
behind SABRE and the Galileo International, Inc. in market share among travel
agents in the United States.
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Fuel
Delta's operations are significantly affected by the availability and
price of jet fuel. Based on the Company's fiscal 1997 jet fuel consumption, a
one-cent change in the average annual price per gallon of jet fuel would have
caused an approximately $26 million change in Delta's annual fuel costs. The
following table shows Delta's jet fuel consumption and costs for fiscal years
1993-1997.
Gallons Percent of
Fiscal Consumed Cost Average Price Operating
Year (Millions) (Millions) Per Gallon Expenses*
------ ---------- ---------- ------------- ---------
1993 2,529 $1,592 62.95(cent) 13%
1994 2,550 1,411 55.34 12
1995 2,533 1,370 54.09 12
1996 2,500 1,464 58.53 13
1997 2,599 1,723 66.28 14
- -------------
* Excluding restructuring and other non-recurring charges
Aircraft fuel expense increased 18% in fiscal 1997 compared to fiscal
1996, as the average fuel price per gallon rose 13% to 66.28(cent), and fuel
gallons consumed increased 4%.
Changes in jet fuel prices have industry-wide impact and benefit or harm
Delta's competitors as well as Delta. Accordingly, lower jet fuel prices may be
offset by increased price competition and lower revenues for all air carriers.
Moreover, there can be no assurance that Delta will be able to increase its
fares in response to any future increases in fuel prices.
Delta's jet fuel contracts do not provide material protection against
price increases or for assured availability of supplies. The Company purchases
most of its jet fuel from petroleum refiners under contracts which establish the
price based on various market indices. The Company also purchases aircraft fuel
on the spot market, from off-shore sources and under contracts which permit the
refiners to set the price and give the Company the right to terminate upon short
notice if the price is unacceptable. Information regarding Delta's fuel hedging
program is set forth in Note 4 of the Notes to Consolidated Financial Statements
on page 36 of Delta's 1997 Annual Report to Stockholders, and is incorporated
herein by reference.
Although Delta is currently able to obtain adequate supplies of jet fuel,
it is impossible to predict the future availability or price of jet fuel.
Political disruptions in the oil producing countries, changes in government
policy concerning aircraft fuel production, transportation or marketing, changes
in aircraft fuel production capacity, environmental concerns and other
unpredictable events may result in fuel supply shortages and fuel price
increases in the future. Such shortages and price increases could have a
material adverse effect on Delta's business.
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Personnel
At June 30, 1997, Delta employed 63,441 full-time equivalent personnel,
compared to 60,289 full-time equivalent personnel at June 30, 1996.
The following table presents certain information concerning Delta's
domestic collective bargaining agreements.
Approximate
Number of Contract
Personnel Amendable
Personnel Group Represented Union Date
- --------------- ------------ ------------------- ---------------
Pilots 8,400 Air Line Pilots May 2, 2000
Association,
International
Flight 190 Professional Airline January 1, 1998
Superintendents Flight Control
Association
Delta's relations with labor unions in the United States are governed by
the Railway Labor Act. Under the Railway Labor Act, a labor union seeking to
represent a craft or class of employees is required to file with the National
Mediation Board ("NMB") an application alleging a representation dispute, along
with representation cards signed by at least 35% of the employees in that craft
or class. The NMB then investigates the dispute and, if it finds the labor union
has obtained a sufficient number of representation cards, will conduct an
election to determine whether to certify the labor union as the collective
bargaining representative of that craft or class.
On September 16, 1997, the Transport Workers Union of America filed an
application with the NMB seeking to represent an alleged craft or class
consisting of Delta's approximately 8,000 "Fleet Service" employees for purposes
of collective bargaining. The NMB is investigating the application. The outcome
of this matter cannot presently be determined.
Approximately 2,200 of Delta's personnel are based outside the United
States. Delta personnel in certain foreign countries are represented by labor
organizations.
Environmental Matters
The Airport Noise and Capacity Act of 1990 (the "ANCA") requires the
phase-out of Stage 2 aircraft by December 31, 1999, subject to certain
exceptions. In 1991, the FAA issued regulations which implement the ANCA by
requiring air carriers to reduce (by modification or retirement) the number of
Stage 2 aircraft operated by 25% by December 31, 1994, 50% by December 31, 1996,
75% by December 31, 1998, and 100% by December 31, 1999.
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Alternatively, a carrier may satisfy the regulations by operating a fleet that
is at least 55%, 65%, 75% and 100% Stage 3 by the respective dates set forth in
the preceding sentence.
Delta complied with the ANCA's December 31, 1994 and 1996 requirements. As
of September 9, 1997, Delta operated 407 Stage 3 aircraft, constituting 73% of
its fleet. The Company expects to comply with the ANCA's (1) December 31, 1998
requirement by operating a fleet comprised of at least 75% Stage 3 aircraft; and
(2) December 31, 1999 requirement by hushkitting or retiring its remaining Stage
2 aircraft. Delta has entered into definitive agreements to purchase Stage 3
engine hushkits for a number of its B-727-200 and B-737-200 aircraft.
The ANCA recognizes the rights of operators of airports with noise
problems to implement local noise abatement procedures so long as such
procedures do not interfere unreasonably with interstate or foreign commerce or
the national air transportation system. It generally provides that local noise
restrictions on Stage 3 aircraft first effective after October 1, 1990, require
FAA approval, and establishes a regulatory notice and review process for local
restrictions on Stage 2 aircraft first proposed after October 1, 1990. While
Delta has had sufficient scheduling flexibility to accommodate local noise
restrictions in the past, the Company's operations could be adversely impacted
if locally-imposed regulations become more restrictive or widespread.
The European Union has adopted a uniform policy requiring member states to
phase-out Stage 2 aircraft. Under the policy provisions, the phase-out of Stage
2 aircraft began on April 1, 1995, and will extend for seven years. Each Stage 2
aircraft will be assured a 25 year operating life, but not extending beyond
April 1, 2002. Delta anticipates it will be able to comply with this Stage 2
aircraft phase-out program, which will apply at all airports in the member
states. Other local European airport regulations which penalize or restrict
operations by Stage 2 aircraft have not in the past had an adverse effect on
Delta's operations. Delta's operations could be adversely impacted, however, if
such regulations become more restrictive or widespread.
The United States Environmental Protection Agency (the "EPA") is
authorized to regulate aircraft emissions. The engines on Delta's aircraft
comply with the applicable EPA standards.
Delta has been identified by the EPA as a potentially responsible party (a
"PRP") with respect to the following federal Superfund Sites: the Operating
Industries, Inc. Site in Monterey Park, California; the Peak Oil Site in Tampa,
Florida; the Petroleum Products Corporation Site in Pembroke Park, Florida; and
the Safety Engineered Disposal Site in Hillsboro, Ohio. Delta's alleged
volumetric contribution at each of these sites is small when compared to the
total contributions of all PRPs at that site. Delta is currently aware of soil
and/or ground water contamination present on its current or former leaseholds at
several domestic airports; the Company has a program in place to investigate
and, if appropriate, remediate these sites. Management presently believes that
the resolution of these matters is not likely to have a material adverse effect
on the Company's consolidated financial condition, results of operations or
liquidity.
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Frequent Flyer Program
Delta, like other major airlines, has established a frequent flyer program
offering incentives to maximize travel on Delta. This program allows
participants to accrue mileage for travel awards while flying on Delta, the
Delta Connection carriers and participating airlines. Mileage credit may also be
accrued for the use of certain services offered by program partners such as
hotels, car rental agencies and credit card companies. Delta reserves the right
to terminate the program with six months advance notice, and to change the
program's terms and conditions at any time without notice.
Effective May 1, 1995, Delta modified its frequent flyer program in
certain respects. The modifications included reducing the threshold for a free
travel award from 30,000 miles to 25,000 miles; making free travel awards more
readily transferable; providing that miles earned expire in certain
circumstances; and reducing minimum mileage credit.
Mileage credits earned can be redeemed for free or upgraded air travel,
for membership in Delta's Crown Room Club and for other program partner awards.
Travel awards are subject to certain transfer restrictions and, in most cases,
blackout dates and capacity controlled seating. Miles earned prior to May 1,
1995 do not expire so long as Delta has a frequent flyer program. Miles earned
on or after May 1, 1995 are valid for 36 months from the month of the
participant's last qualifying Delta or Delta Connection flight; every time a
participant completes a qualifying Delta or Delta Connection flight, his mileage
balance is extended for another 36 months.
Delta accounts for its frequent flyer program obligations by recording a
liability for the estimated incremental cost of flight awards the Company
expects to be redeemed. The estimated incremental cost associated with a flight
award does not include any contribution to overhead or profit. Such incremental
cost is based on Delta's system average cost per passenger for fuel; food and
food supplies; passenger insurance, injuries, losses and damages; interrupted
trips and oversales; porter service; ticket forms; bag tags; boarding forms;
in-flight entertainment; and customs. Delta does not record a liability for
mileage earned by participants who have not reached the level to become eligible
for a free travel award. Delta believes this exclusion is immaterial and
appropriate because the large majority of these participants are not expected to
earn a free flight award. Delta does not account for the redemption of
non-travel awards since the cost of these awards to Delta is negligible.
Delta estimated the potential number of roundtrip flight awards
outstanding to be 8.8 million at June 30, 1995, 8.6 million at June 30, 1996 and
9.1 million at June 30, 1997. Of these earned awards, Delta expected that
approximately 5.7 million, 5.7 million and 6.0 million, respectively, would be
redeemed. At June 30, 1995, 1996 and 1997, Delta had recorded a liability for
these awards of $101 million, $103 million and $122 million, respectively. The
difference between the roundtrip awards outstanding and the awards expected to
be redeemed is the estimate, based on historical data, of awards which will (1)
never be redeemed; (2) be redeemed for something other than a free trip; or (3)
be redeemed on another carrier participating in the program.
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Frequent flyer program participants flew 2.0 million, 1.7 million and 1.7
million free round-trips in fiscal years 1995, 1996 and 1997, respectively.
These round-trips accounted for approximately 8%, 8% and 6% of the total
passenger miles flown for the respective periods. Delta believes that the low
percentage of free passenger miles, its load factor and the restrictions applied
to free travel awards minimize the displacement of revenue passengers.
The DOT is conducting a review of the frequent flyer programs of the
larger U.S. airlines. The focus of the review relates to limitations placed by
the carriers on the availability of award seats and the adequacy of consumer
notices concerning such limitations.
Civil Reserve Air Fleet Program
Delta is a participant in the Civil Reserve Air Fleet Program pursuant to
which the Company has agreed to make available, during the period beginning
October 1, 1997 and ending September 30, 1998, up to 21 of its international
range aircraft for use by the United States military under certain stages of
readiness related to national emergencies.
ITEM 2. PROPERTIES
Flight Equipment
Information relating to Delta's aircraft fleet is set forth in the charts
titled "Aircraft Fleet at June 30, 1997" and "Aircraft Delivery Schedules" on
page 13, and in Notes 8 and 9 of the Notes to Consolidated Financial Statements
on pages 40-41, of Delta's 1997 Annual Report to Stockholders, and is
incorporated herein by reference.
Delta's long-term aircraft fleet plan is to simplify its fleet by reducing
aircraft family types from six to three, while replacing older aircraft types
with newer Boeing 767 and 737 aircraft over several years. The Company plans to
remove all L-1011 aircraft from transatlantic service by the end of fiscal 1998,
and to retire all L-1011 aircraft from its fleet within the next several years.
Ground Facilities
Delta leases most of the land and buildings that it occupies. The
Company's largest aircraft maintenance base, various computer, cargo, flight
kitchen and training facilities and most of its principal offices are located at
or near Hartsfield Atlanta International Airport in Atlanta, Georgia, on land
leased from the City of Atlanta under long-term leases. Delta owns a portion of
its principal offices, its Atlanta reservations center and other improved and
unimproved real property in Atlanta, as well as a limited number of radio
transmitting and receiving sites and certain other facilities.
Delta leases ticket counter and other terminal space, operating areas and
air cargo facilities in most of the airports which it serves. These leases
generally run for periods of from less than one year to thirty years or more,
and contain provisions for periodic adjustment of lease rates. At
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most airports which it serves, Delta has entered into use agreements which
provide for the non-exclusive use of runways, taxiways, and other facilities;
landing fees under these agreements normally are based on the number of landings
and weight of aircraft. The Company also leases aircraft maintenance facilities
at certain airports, generally under long-term leases which cover the cost of
providing, operating and maintaining such facilities. In addition, Delta leases
marketing, ticket and reservations offices in certain major cities which it
serves; these leases are generally for shorter terms than the airport leases.
Additional information relating to Delta's ground facilities is set forth in
Notes 4, 8 and 9 of the Notes to Consolidated Financial Statements on pages 36,
and 40-41, of Delta's 1997 Annual Report to Stockholders, and is incorporated
herein by reference.
In recent years, some airports have increased or sought to increase the
rates charged to airlines to levels that, in the airlines' opinion, are
unreasonable. The extent to which such charges are limited by statute or
regulation and the ability of airlines to contest such charges has been subject
to litigation and to administrative proceedings before the DOT. If the
limitations on such charges are relaxed or the ability of airlines to challenge
such charges is restricted, the rates charged by airports to airlines may
increase substantially.
ITEM 3. LEGAL PROCEEDINGS
On November 2, 1995, Delta reached an agreement with Trans World Airlines,
Inc. ("TWA") to lease ten takeoff/landing slots ("Slots") at New York's La
Guardia Airport ("La Guardia"). On November 9, 1995, ValuJet Airlines, Inc.
("ValuJet") filed suit against Delta and TWA in the United States District Court
for the Northern District of Georgia. ValuJet alleges, among other things, that
(1) TWA breached an alleged agreement to lease the Slots to ValuJet; (2) Delta
tortiously interfered with the alleged contract between ValuJet and TWA; (3)
Delta and TWA conspired to restrain trade in violation of Section 1 of the
Sherman Act; and (4) Delta engaged in acts of monopolization and attempted
monopolization in violation of Section 2 of the Sherman Act. ValuJet, which has
requested a jury trial, is seeking injunctive relief, unspecified compensatory
damages, treble damages under the antitrust laws, punitive damages, costs and
attorney's fees, and such other relief as the District Court deems appropriate.
On December 7, 1995, Delta filed its answer denying liability and asserting
various affirmative defenses. On July 12, 1996, the District Court granted TWA's
motion for summary judgment in whole, granted Delta's motion for summary
judgment with respect to ValuJet's claims of tortious interference and
conspiracy, and denied Delta's motion for summary judgment with respect to
ValuJet's remaining claims under Section 2 of the Sherman Act on the ground that
those claims were not subject to resolution without further discovery. On August
14, 1997, the District Court denied Delta's renewed motion for summary judgment
with respect to ValuJet's claims under Section 2 of the Sherman Act. Delta
intends to defend this matter vigorously.
Delta received a Civil Investigative Demand from the United States
Department of Justice requesting information and documents concerning Delta's
lease of the Slots. Delta has responded to this request.
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Delta is also a defendant in certain other legal actions relating to
alleged employment discrimination practices, other matters concerning past and
present employees, environmental issues and other matters concerning Delta's
business. Although the ultimate outcome of these matters and the matters
discussed above in this Item 3 cannot be predicted with certainty and could have
a material adverse effect on Delta's consolidated financial condition, results
of operations or liquidity, management presently believes that the resolution of
these actions is not likely to have a material adverse effect on Delta's
consolidated financial condition, results of operations or liquidity.
For a discussion of certain environmental matters, see "ITEM 1. Business -
Environmental Matters" on pages 7-8 of this Form 10-K.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
Not applicable.
EXECUTIVE OFFICERS OF THE REGISTRANT
Certain information concerning Delta's executive officers follows. Unless
otherwise indicated, all positions shown are with Delta. There are no family
relationships between any of Delta's executive officers.
Leo F. Mullin Mr. Mullin has been President and Chief Executive
Officer of Delta since August 14, 1997. He was
Vice Chairman of Unicom Corporation and its
principal subsidiary, Commonwealth Edison Company,
from 1995 through August 13, 1997. Mr. Mullin was
an executive of First Chicago Corporation from
1981 to 1995, serving as that company's President
and Chief Operating Officer from 1993 to 1995, and
as Chairman and Chief Executive Officer of
American National Bank, a subsidiary of First
Chicago Corporation, from 1991 to 1993. Age 54.
Maurice W. Worth Chief Operating Officer, August 14, 1997 to date;
Acting Chief Executive Officer, August 1, 1997
through August 13, 1997; Executive Vice President -
Customer Service and Acting Chief Operating
Officer, May 12, 1997 through July 31, 1997;
Executive Vice President - Customer Service,
September 13, 1995 through May 11, 1997; Senior
Vice President - Personnel, May 1991 through
September 12, 1995; Vice President - Personnel,
November 1989 through April 1991. Age 57.
12
14
Harry C. Alger Executive Vice President - Operations, March 1993
to date; Senior Vice President - Operations,
February 1992 through February 1993; Vice
President - Flight Operations, August 1987 through
January 1992. Age 59.
Robert W. Coggin Executive Vice President - Marketing, September
13, 1995 to date; Senior Vice President -
Marketing, August 1992 through September 12,
1995; Senior Vice President - Marketing
Development and Planning, February 1992 through
July 1992; Vice President - Marketing
Development and Planning, November 1991 through
January 1992; Vice President - Marketing
Development, November 1988 through October 1991.
Age 61.
Robert G. Adams Senior Vice President - Personnel, November 1,
1996 to date; Vice President - Personnel,
September 16, 1995 through October 31, 1996; Vice
President - Personnel Services, November 1, 1993
through September 15, 1995; Assistant Vice
President - Personnel Services, August 1, 1993
through October 31, 1993; Assistant Vice President
- Personnel - International, November 1, 1991
through July 31, 1993; Vice President - Human
Resources, Pan American World Airways, Inc., 1982
through October 31, 1991. Age 59.
Robert S. Harkey Senior Vice President - General Counsel and
Secretary, November 1994 to date; Senior Vice
President - General Counsel, November 1990 through
October 1994; Vice President - General Counsel,
November 1988 through October 1990. Age 56.
Thomas J. Roeck, Jr. Senior Vice President - Finance and Chief
Financial Officer, June 1988 to date. Age 53.
13
15
PART II
ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
Information required by this item is set forth under "Common Stock",
"Number of Shareholders" and "Market Prices and Dividends" on page 52 of Delta's
1997 Annual Report to Stockholders, and is incorporated herein by reference.
Under the Delta Air Lines, Inc. Directors' Deferred Compensation Plan
("Plan"), members of the Company's Board of Directors may defer for a specified
period all or any part of their cash compensation earned as a director. A
participating director may choose an investment return on the deferred amount
from among the 17 investment return choices available under the Delta
Family-Care Savings Plan, a qualified defined contribution pension plan for
eligible Delta personnel. One of the investment return choices under the Delta
Family-Care Savings Plan is a fund invested primarily in Delta's common stock
("Delta Common Stock Fund"). During the quarter ended June 30, 1997,
participants in the Plan deferred a total of $39,750 in the Delta Common Stock
Fund investment return choice (equivalent to approximately 463 shares of Delta
common stock at prevailing market prices). These transactions were not
registered under the Securities Act of 1933, as amended, in reliance on Section
4(2) of such Act.
ITEM 6. SELECTED FINANCIAL DATA
Information required by this item is set forth on pages 50-51 of Delta's
1997 Annual Report to Stockholders, and is incorporated herein by reference.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Information required by this item is set forth on pages 21-27 of Delta's
1997 Annual Report to Stockholders, and is incorporated herein by reference.
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Information required by this item is set forth under "Market Risks
Associated With Financial Instruments" on page 25, and in Note 4 of the Notes to
Consolidated Financial Statements on page 36, of Delta's 1997 Annual Report to
Stockholders, and is incorporated herein by reference.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
Information required by this item is set forth on pages 28-48, and in
"Report of Independent Public Accountants" on page 49, of Delta's 1997 Annual
Report to Stockholders, and is incorporated herein by reference.
14
16
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE
Not applicable.
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
Information required by this item is set forth on pages 5-7, and under
"Other Matters Involving Directors and Executive Officers - Section 16(a)
Beneficial Ownership Reporting Compliance" on page 22, of Delta's Proxy
Statement dated September 15, 1997, and is incorporated herein by reference.
Certain information regarding executive officers is contained in Part I of this
Form 10-K.
ITEM 11. EXECUTIVE COMPENSATION
Information required by this item is set forth on pages 4, and 16-22, of
Delta's Proxy Statement dated September 15, 1997, and is incorporated herein by
reference.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
Information required by this item is set forth on pages 8-10 of Delta's
Proxy Statement dated September 15, 1997, and is incorporated herein by
reference.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Mr. George D. Busbee and Mr. Peter D. Sutherland are members of the
Company's Board of Directors. Mr. Busbee is of counsel to the law firm of King
& Spalding, which provided certain legal services to the Company in fiscal 1997
and is expected to provide similar services in fiscal 1998. Mr. Sutherland is a
general partner of Goldman, Sachs & Co., which provided certain investment
banking services to the Company in fiscal 1997 and is expected to provide
similar services in fiscal 1998.
Additional information required by this item is set forth on pages 20-22
of Delta's Proxy Statement dated September 15, 1997, and is incorporated herein
by reference.
15
17
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K
(a)(1), (2). The financial statements and schedule required by this item are
listed in the Index to Consolidated Financial Statements and Schedule on page 19
of this Form 10-K.
(3). The exhibits required by this item are listed in the Exhibit
Index on pages 24-26 of this Form 10-K. The management contracts and
compensatory plans or arrangements required to be filed as an exhibit to this
Form 10-K are listed as Exhibit 10.1 and Exhibits 10.7 to 10.16 in the Exhibit
Index.
(b) During the quarter ended June 30, 1997, Delta did not file any
Current Reports on Form 8-K.
16
18
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized, on the 26th day of
September, 1997.
DELTA AIR LINES, INC.
By: /s/ Leo F. Mullin
--------------------------------------
Leo F. Mullin
President and Chief Executive Officer
Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below on the 26th day of September, 1997 by the following
persons on behalf of the registrant and in the capacities indicated.
Signature Title
--------- -----
Edwin L. Artzt* Director
- -------------------------------
Edwin L. Artzt
Henry A. Biedenharn, III* Director
- -------------------------------
Henry A. Biedenharn, III
James L. Broadhead* Director
- -------------------------------
James L. Broadhead
Edward H. Budd* Director
- -------------------------------
Edward H. Budd
George D. Busbee* Director
- -------------------------------
George D. Busbee
R. Eugene Cartledge* Director
- -------------------------------
R. Eugene Cartledge
17
19
Signature Title
Mary Johnston Evans* Director
- -------------------------------
Mary Johnston Evans
Gerald Grinstein* Non-executive Chairman of the Board
- -------------------------------
Gerald Grinstein
Jesse Hill, Jr.* Director
- -------------------------------
Jesse Hill, Jr.
/s/ Leo F. Mullin President and Chief Executive
- ------------------------------- Officer and a Director
Leo F. Mullin (Principal Executive Officer)
/s/ Thomas J. Roeck, Jr. Senior Vice President-Finance
- ------------------------------- and Chief Financial Officer
Thomas J. Roeck, Jr. (Principal Financial Officer
and Principal Accounting Officer)
Peter D. Sutherland* Director
- -------------------------------
Peter D. Sutherland
Andrew J. Young* Director
- -------------------------------
Andrew J. Young
*By: /s/ Thomas J. Roeck, Jr. Attorney-In-Fact
---------------------------
Thomas J. Roeck, Jr.
18
20
INDEX TO CONSOLIDATED FINANCIAL STATEMENTS AND SCHEDULE
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS - Incorporated herein by reference to
"Report of Independent Public Accountants" on page 49 of Delta's 1997
Annual Report to Stockholders.
FINANCIAL STATEMENTS - All of which are incorporated herein by reference to
Delta's 1997 Annual Report to Stockholders.
Consolidated Balance Sheets - June 30, 1997 and 1996
Consolidated Statements of Operations for the years ended June 30, 1997,
1996 and 1995
Consolidated Statements of Cash Flows for the years ended June 30, 1997,
1996 and 1995
Consolidated Statements of Shareholders' Equity for the years ended June
30, 1997, 1996 and 1995
Notes to Consolidated Financial Statements - June 30, 1997, 1996 and 1995
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS ON SCHEDULE
SCHEDULE SUPPORTING FINANCIAL STATEMENTS:
Schedule
Number
-------
II Valuation and Qualifying Accounts for the fiscal years ended June
30, 1997, 1996 and 1995
All other schedules have been omitted as not applicable.
19
21
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS ON SCHEDULE
To Delta Air Lines, Inc.:
We have audited, in accordance with generally accepted auditing standards, the
consolidated financial statements included in Delta Air Lines, Inc.'s annual
report to stockholders incorporated by reference in this Form 10-K and have
issued our report thereon dated August 15, 1997. Our audit was made for the
purpose of forming an opinion on those statements taken as a whole. The schedule
listed in the accompanying index is the responsibility of the Company's
management, is presented for purposes of complying with the Securities and
Exchange Commission's rules, and is not part of the basic financial statements.
The schedule has been subjected to the auditing procedures applied in the audit
of the basic financial statements and, in our opinion, fairly states in all
material respects the financial data required to be set forth therein in
relation to the basic consolidated financial statements taken as a whole.
ARTHUR ANDERSEN LLP
Atlanta, Georgia
August 15, 1997
20
22
SCHEDULE II
DELTA AIR LINES, INC.
VALUATION AND QUALIFYING ACCOUNTS
FOR THE FISCAL YEAR ENDED JUNE 30, 1997
(Amounts in Millions)
Column A Column B Column C Column D Column E
Additions
---------
Charged to
Balance at Charged to Other Balance at
Beginning of Costs and Accounts- Deductions- End of
Description Period Expenses describe describe Period
----------- ------------ ----------- ----------- ----------- -----------
DEDUCTION (INCREASE) IN THE
BALANCE SHEET FROM THE
ASSET TO WHICH IT APPLIES:
Allowance for uncollectible
accounts receivable: $ 44 $ 30 - $ 26 (a) $ 48
Allowance for unrealized gains
on marketable equity
securities: $(206) - - $ 40 (b) $(166)
(a) Represents write-off of accounts considered to be uncollectible, less
collections.
(b) Represents net unrealized loss recognized resulting from changes in market
values.
21
23
SCHEDULE II
DELTA AIR LINES, INC.
VALUATION AND QUALIFYING ACCOUNTS
FOR THE FISCAL YEAR ENDED JUNE 30, 1996
(Amounts in Millions)
Column A Column B Column C Column D Column E
Additions
---------
Charged to
Balance at Charged to Other Balance at
Beginning of Costs and Accounts- Deductions- End of
Description Period Expenses describe describe Period
----------- ------------ ----------- ----------- ------------ -----------
DEDUCTION (INCREASE) IN THE
BALANCE SHEET FROM THE
ASSET TO WHICH IT APPLIES:
Allowance for uncollectible
accounts receivable: $ 29 $ 15 - - $ 44
Allowance for unrealized
gains on marketable equity
securities: $(131) - $(75) (a) - $(206)
(a) Represents net unrealized gain recognized resulting from changes in market
values.
22
24
SCHEDULE II
DELTA AIR LINES, INC.
VALUATION AND QUALIFYING ACCOUNTS
FOR THE FISCAL YEAR ENDED JUNE 30, 1995
(Amounts in Millions)
Column A Column B Column C Column D Column E
Additions
Charged to
Balance at Charged to Other Balance at
Beginning of Costs and Accounts- Deductions- End of
Description Period Expenses describe describe Period
----------- ------------ ---------- ----------- ----------- ----------
DEDUCTION (INCREASE) IN THE
BALANCE SHEET FROM THE
ASSET TO WHICH IT APPLIES:
Allowance for uncollectible
accounts receivable: $ 50 $ 21 - $ 42 (a) $ 29
Allowance for unrealized
gains on marketable equity
securities: $(85) - $(46) (b) - $(131)
(a) Represents write-off of accounts considered to be uncollectible, less
collections.
(b) Represents net unrealized gain recognized resulting from changes in market
values.
23
25
EXHIBIT INDEX
3.1 Delta's Certificate of Incorporation (Filed as Exhibit 4.1 to Delta's
Registration Statement on Form S-8 (Registration No. 333-16471)).*
3.2 Delta's By-Laws (Filed as Exhibit 3 to Delta's Current Report on Form
8-K dated November 17, 1993).*
4.1 Rights Agreement dated as of October 24, 1996, between Delta and First
Chicago Trust Company of New York, as Rights Agent (Filed as Exhibit 1 to
Delta's Form 8-A/A Registration Statement dated November 4, 1996).*
4.2 Certificate of Designations, Preferences and Rights of Series B ESOP
Convertible Preferred Stock and Series D Junior Participating Preferred Stock
(Filed as part of Exhibit 3.1 of this Form 10-K).
4.3 Indenture dated as of March 1, 1983, between Delta and The Citizens
and Southern National Bank, Trustee, as supplemented by the First and Second
Supplemental Indentures thereto dated as of January 27, 1986 and May 26, 1989,
respectively (Filed as Exhibit 4 to Delta's Registration Statement on Form S-3
(Registration No. 2-82412), Exhibit 4(b) to Delta's Registration Statement on
Form S-3 (Registration No. 33-2972), and Exhibit 4.5 to Delta's Annual Report on
Form 10-K for the year ended June 30, 1989).*
4.4 Agreement dated May 31, 1989, among Delta, The Citizens and Southern
National Bank and The Citizens and Southern National Bank of Florida relating to
the appointment of a successor trustee under the Indenture dated as of March 1,
1983, as supplemented, between Delta and The Citizens and Southern National Bank
(Filed as Exhibit 4.6 to Delta's Annual Report on Form 10-K for the year ended
June 30, 1989).*
4.5 Indenture dated as of April 30, 1990, between Delta and The Citizens
and Southern National Bank of Florida, Trustee (Filed as Exhibit 4(a) to
Amendment No. 1 to Delta's Registration Statement on Form S-3 (Registration No.
33-34523)).*
4.6 Indenture dated as of May 1, 1991, between Delta and The Citizens and
Southern National Bank of Florida, Trustee (Filed as Exhibit 4 to Delta's
Registration Statement on Form S-3 (Registration No. 33-40190)).*
4.7 Credit Agreement dated as of May 2, 1997, by and among Delta, Certain
Banks and NationsBank, N.A. (South), as Agent Bank.
4.8 Note Purchase Agreement dated February 22, 1990, among the Delta
Family-Care Savings Plan, Issuer, Delta, Guarantor, and Various Lenders relating
to the Guaranteed Serial ESOP Notes (Filed as Exhibit 10 to Delta's Current
Report on Form 8-K dated April 25, 1990).*
24
26
4.9 Indenture of Trust dated as of August 1, 1993, among Delta, Fidelity
Management Trust Company, ESOP Trustee, and Wilmington Trust Company, Trustee,
relating to the Guaranteed Serial ESOP Notes (Filed as Exhibit 4.12 to Delta's
Annual Report on Form 10-K for the year ended June 30, 1993).*
Delta is not filing any other instruments evidencing any indebtedness
because the total amount of securities authorized under any single such
instrument does not exceed 10% of the total assets of Delta and its subsidiaries
on a consolidated basis. Copies of such instruments will be furnished to the
Securities and Exchange Commission upon request.
10.1 Delta's Incentive Compensation Plan, as amended (Filed as Appendix A
to Delta's Proxy Statement dated September 16, 1996).*
10.2 Stock Purchase Agreement dated July 10, 1989, between Delta and
Swissair, Swiss Air Transport Company Ltd. (Filed as Exhibit 10.2 to Delta's
Current Report on Form 8-K dated July 24, 1989).*
10.3 Stock Purchase Agreement dated August 21, 1989, between Delta and
Swissair, Swiss Air Transport Company Ltd. (Filed as Exhibit 10.9 to Delta's
Annual Report on Form 10-K for the year ended June 30, 1989).*
10.4 Stock Purchase Agreement dated October 26, 1989, between Singapore
Airlines Limited and Delta (Filed as Exhibit 10.1 to Delta's Current Report on
Form 8-K dated November 2, 1989).*
10.5 Stock Purchase Agreement dated October 26, 1989, between Delta and
Singapore Airlines Limited (Filed as Exhibit 10.2 to Delta's Current Report on
Form 8-K dated November 2, 1989).*
10.6 Sixth Amended and Restated Limited Partnership Agreement of
WORLDSPAN, L.P. dated as of April 30, 1993 (Filed as Exhibit 10.6 to Delta's
Annual Report on Form 10-K for the year ended June 30, 1993).*
10.7 Employment Agreement dated July 29, 1987, between Delta and Mr.
Ronald W. Allen, as amended by the Amendments thereto dated February 1, 1992,
August 15, 1992, October 28, 1993, and August 16, 1996 (Filed as Exhibit 10.8 to
Delta's Annual Report on Form 10-K for the year ended June 30, 1987, Exhibit 10
to Delta's Quarterly Report on Form 10-Q for the quarter ended March 31, 1992,
Exhibit 10.13 to Delta's Annual Report on Form 10-K for the year ended June 30,
1992, Exhibit 10 to Delta's Quarterly Report on Form 10-Q for the quarter ended
December 31, 1993 and Exhibit 10.9 to Delta's Annual Report on Form 10-K for the
year ended June 30, 1996).*
10.8 Agreement dated as of July 31, 1997 between Delta and Mr. Ronald W.
Allen.
25
27
10.9 Delta's 1989 Stock Incentive Plan, as amended (Filed as Exhibit
10.10 to Delta's Annual Report on Form 10-K for the year ended June 30, 1996).*
10.10 Delta's Executive Deferred Compensation Plan, as amended (Filed as
Exhibit 10.11 to Delta's Annual Report on Form 10-K for the year ended June 30,
1995).*
10.11 Directors' Deferred Compensation Plan (Filed as Exhibit 10.12 to
Delta's Annual Report on Form 10-K for the year ended June 30, 1996).*
10.12 Directors' Charitable Award Program (Filed as Exhibit 10.14 to
Delta's Annual Report on Form 10-K for the year ended June 30, 1993).*
10.13 1991 Delta Excess Benefit Plan, The Delta Supplemental Excess
Benefit Plan and Form of Excess Benefit Plan Agreement (Filed as Exhibit 10.18
to Delta's Annual Report on Form 10-K for the year ended June 30, 1992).*
10.14 Delta's Non-employee Directors' Stock Plan (Filed as Exhibit 4.5 to
Delta's Registration Statement on Form S-8 (Registration No. 33-65391)).*
10.15 Form of Stock Option and Restricted Stock Award Agreements under
1989 Stock Incentive Plan (Filed as Exhibit 10.17 to Delta's Annual Report on
Form 10-K for the year ended June 30, 1996).*
10.16 Forms of Executive Retention Protection Agreements for Certain
Officers.
10.17 Agreement dated April 29, 1996, between Delta and The Air Line
Pilots in the service of Delta as represented by the Air Line Pilots
Association, International (Filed as Exhibit 10 to Delta's Quarterly Report on
Form 10-Q for the Quarter ended March 31, 1996).*
11. Statement regarding computation of per share earnings for the years
ended June 30, 1997, 1996 and 1995.
12. Statement regarding computation of ratio of earnings to fixed charges
for the years ended June 30, 1997, 1996, 1995, 1994 and 1993.
13. Portions of Delta's 1997 Annual Report to Stockholders.
18. Letter re Change in Accounting Principles.
23. Consent of Arthur Andersen LLP.
24. Powers of Attorney.
27. Financial Data Schedule.
- ----------------------------
*Incorporated herein by reference
26