Employment Agreement [Waiver] - Delta Air Lines Inc., Leo F. Mullin and Frederick W. Reid
SUMMARY OF WAIVER ("WAIVER") DATED AS OF JULY 24, 2003 EXECUTED BY EACH OF MR.
MULLIN AND MR. REID AS A RESULT OF DELTA'S CONTRACT WITH THE UNITED STATES OF
AMERICA DATED MAY 6, 2003 (THE "GOVERNMENT CONTRACT") PURSUANT TO THE EMERGENCY
WARTIME SUPPLEMENTAL APPROPRIATIONS ACT OF 2003 (THE "APPROPRIATIONS ACT")
Pursuant to the Appropriations Act, we entered into the Government Contract,
which was filed with our Form 10-Q for the quarter ended March 31, 2003. Under
the Government Contract, we agreed to limit the Total Cash Compensation of our
Executive Officers (each as defined in the Government Contract) for the
12-month period beginning April 1, 2003.
We subsequently entered into the Waiver with each of Mr. Mullin and Mr. Reid.
Under the Waiver, Mr. Mullin and Mr. Reid agreed to waive their right to any
compensation that would cause us to violate the Government Contract. As
consideration for these agreements, we waived our right, in certain
circumstances, to reduce the amount of the performance-based restricted stock
award that is payable to them in 2004.
<PAGE>
WAIVER
Waiver (this "WAIVER") dated as of July 24, 2003 by and between Delta Air
Lines, Inc., a Delaware corporation (the "COMPANY"), and ("EXECUTIVE").
WHEREAS, pursuant to the Emergency Wartime Supplemental Appropriations Act
of 2003, the Company entered into an agreement with the United States of America
dated May 6, 2003 (the "GOVERNMENT CONTRACT");
WHEREAS, pursuant to Paragraph 4.1 of the Government Contract, the Company
has agreed to limit the "Total Cash Compensation" of its "Executive Officers"
(each as defined in the Government Contract) for a 12-month period beginning
April 1, 2003; and
WHEREAS, the Company and Executive have determined that it is in the best
interest of the Company and Executive for Executive to waive certain
compensation to which Executive may be otherwise entitled to the extent
necessary for the Company to comply with Paragraph 4.1 of the Government
Contract;
NOW, THEREFORE, in consideration of the foregoing, the agreements set
forth below and other good and valuable consideration, the receipt of which is
hereby acknowledged, the parties hereto, intending to be legally bound, agree as
follows:
Section 1. Waiver of Certain Compensation in Connection With the
Government Contract. Notwithstanding anything in any agreement, understanding,
plan or program to the contrary, in the event the Personnel & Compensation
Committee of the Board of Directors of the Company (the "COMPENSATION
COMMITTEE") shall determine in its reasonable discretion that making any payment
or providing any benefit to which Executive may be otherwise entitled under any
agreement or understanding with the Company or pursuant to any plan or program
of the Company (a "PAYMENT") would cause the Company to violate its agreement
under Paragraph 4.1 of the Government Contract, Executive hereby agrees that he
shall not be entitled to such payment and/or benefit and, instead, the
Compensation Committee shall reduce such payment(s) and/or benefit(s) by an
amount, determined by the Compensation Committee in its reasonable discretion,
such that the Company shall not be in such violation. Further, Executive hereby
agrees that in the event the Compensation Committee determines in its reasonable
discretion that any payment to Executive (including any reimbursement of
expenses) would cause the Company to violate Paragraph 4.1 of the Government
Contract (such payment, an "Excess Payment"), upon notification from the
Compensation Committee, Executive shall promptly repay such Excess Payment to
the Company. In addition, Executive hereby agrees that the Company shall have
the right (a) to set-
2
<PAGE>
off any Excess Amount against any obligation to make a payment or honor a
commitment to Executive and (b) to postpone any Payment for a reasonable period
of time to enable the Compensation Committee to determine whether such Payment
would constitute an Excess Payment.
Section 2. Waiver of Company's Negative Discretion in Connection with
Long-Term Performance Award. In consideration for Executive's waiver of certain
rights and privileges as set forth herein, provided that Executive's employment
with the Company continues through December 31, 2003, the Company hereby waives
the Compensation Committee's right pursuant to Section 6 of Executive's
Performance-Based Restricted Stock Agreement dated January 25, 2001 (the
"PERFORMANCE AGREEMENT") to reduce the amount of Executive's performance award
payable in calendar year 2004 thereunder.
Section 3. Effectiveness. This Waiver shall be effective as of the date
first above written.
Section 4. Effect of Waiver. Except as waived hereby, all of the
provisions of any affected agreement, plan or program, including the Performance
Plan, shall remain in full force and effect without modification or waiver.
Section 5. Entire Agreement. This Waiver constitutes the entire agreement
between the Company and Executive with respect to the subject matter hereof, and
supersedes any other prior agreement, written or oral, between the parties with
respect thereto. This Waiver may only be amended by written instrument signed by
both the Company and Executive.
Section 6. Governing Law. This Waiver shall be governed by and construed
in accordance with laws of the State of Georgia without reference to principles
of conflict of laws.
Section 7. Successors. This Waiver shall be binding upon Executive's
personal and legal representatives, executors, administrators, successors,
heirs, distributees, devisees and legatees.
IN WITNESS WHEREOF, the Company and Executive have executed this Waiver.
EXECUTIVE DELTA AIR LINES, INC.
/s/ By: /s/ David Goode
------------------------------- -----------------------------------
Name: David Goode
Title: Chairman, Personnel &
Compensation Committee
3