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EXHIBIT 10.11
[As amended through July 18, 1995]
DELTA AIR LINES, INC.
EXECUTIVE DEFERRED COMPENSATION PLAN
ARTICLE 1. ESTABLISHMENT AND PURPOSES
1.1 ESTABLISHMENT. Delta Air Lines, Inc., a Delaware corporation
(the "Company"), hereby establishes, effective as of July 1, 1994, a deferred
compensation plan for key employees as described herein, which shall be known
as the "Delta Air Lines, Inc. Executive Deferred Compensation Plan" (the
"Plan").
1.2 PURPOSE. The purpose of the Plan is to provide certain key
employees of the Company with the opportunity to voluntarily defer a portion of
their compensation, subject to the terms of the Plan. By adopting the Plan,
the Company desires to enhance its ability to attract and retain employees of
outstanding competence.
ARTICLE 2. DEFINITIONS
Whenever used herein, the following terms shall have the meanings set
forth below, and, when the defined meaning is intended, the term is
capitalized:
(a) "Board" or "Board of Directors" means the Board of Directors
of the Company.
(b) "Bonus" means any incentive award based on an assessment of
performance, payable by the Company to a Participant with
respect to the Participant's services during a given fiscal
year of the Company, and shall be deemed earned only upon
award by the Company. For purposes of the Plan, "Bonus" shall
not include incentive awards which relate to a period
exceeding one (1) fiscal year.
(c) "Change in Control" shall be deemed to have occurred:
(i) Fifteen (15) days after a public announcement that
any person (as that term is used in Section 13(d) and
14(d) of the Securities Exchange Act of 1934, as
amended), without prior approval of the Board, has
acquired, either directly or indirectly, beneficial
ownership of securities representing twenty percent
(20%) or more of the total votes that could be cast
by the holders of all the Company's outstanding
securities entitled to vote in elections of
Directors; or
(ii) When individuals constituting the Board as of the
Effective Date (or the successors of such individuals
nominated by a Board of Directors on which such
individuals or such successors constituted a
majority) cease to constitute a majority of the Board
of Directors.
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(d) "Code" means the Internal Revenue Code of 1986, as amended.
(e) "Committee" means a committee of two (2) or more individuals,
appointed by the Board to administer the Plan, pursuant to
Article 3 herein.
(f) "Company" means Delta Air Lines, Inc., a Delaware corporation
(including any and all Subsidiaries), and any successor
thereto.
(g) "Compensation" means the gross Salary, Bonus, Long-Term
Awards, and other payments eligible for deferral under the
Plan, which are payable to a Participant with respect to
services performed during a specified period.
(h) "Disability" means a disability which would qualify the
Participant for Long-Term Disability benefits as defined in
Section 4.03 of the Delta Family-Care Disability and
Survivorship Plan, as may be amended from time to time.
(i) "Effective Date" means the date the Plan becomes effective, as
set forth in Section 1.1 herein.
(j) "Employee" means a full-time, salaried employee of the Company.
(k) "ERISA" means the Employee Retirement Income Security Act of
1974, as amended from time to time, or any successor Act
thereto.
(l) "Long-Term Award" means any cash award (other than cash
payment in connection with any stock option or stock
appreciation right awards under the 1989 Stock Incentive Plan)
payable to a Participant pursuant to a Company program which
establishes incentive award opportunities which are contingent
upon performance which is measured over periods greater than
one (1) year.
(m) "Participant" means an Employee who has elected to participate
in the Plan.
(n) "Salary" means all regular, basic wages, before reduction for
amounts deferred pursuant to the Plan or any other plan of the
Company, payable in cash to a Participant for services to be
rendered during the calendar year, exclusive of any Bonus,
Long-Term Awards, other special fees, awards, or incentive
compensation, allowances, or amounts designated by the Company
as payment toward or reimbursement of expenses.
(o) "Subsidiary" means any corporation (other than the Company) in
which the Company or a Subsidiary of the Company owns fifty
percent (50%) or more of the total combined voting power of
all classes of stock.
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ARTICLE 3. ADMINISTRATION
3.1 AUTHORITY OF THE COMMITTEE. The Plan shall initially be
administered by the Personnel, Compensation & Nominating Committee of the
Board. Subject to the terms of this Plan, the Board may appoint a successor
Committee to administer the Plan. The members of the Committee shall be
appointed by, must be members of, and shall serve at the discretion of the
Board.
Subject to the provisions herein, the Committee shall have the
exclusive discretion to select Employees for participation in the Plan; to
determine the terms and conditions of each Employee's participation in the
Plan; to construe and interpret the Plan and any agreement or instrument
entered into under the Plan; to establish, amend, or waive rules and
regulations for the Plan's administration; to amend (subject to the provisions
of Article 9 herein) the terms and conditions of the Plan and any agreement
entered into under the Plan; and to make other determinations which may be
necessary or advisable for the administration of the Plan. Subject to the
terms of the Plan, the Committee may delegate any or all of its authority
granted under the Plan to an executive or executives of the Company.
3.2 CLAIMS PROCEDURE. If a request for benefits by a Participant
or beneficiary is wholly or partially denied, the Committee will provide such
claimant written notice setting forth the denial. A review procedure is
available upon written request by the claimant to the Committee within 90 days
after the date of the Committee's written notice of the denial of the claim,
and includes the right to examine pertinent documents and submit issues and
comments in writing to the Committee. The decision on review will be made
within 90 days after receipt of the request for review, unless circumstances
warrant an extension of time not to exceed an additional 90 days, and shall be
in writing. If a decision on review is not made within such period, the
Participant's claim shall be deemed denied.
3.3 DECISIONS BINDING. All determinations and decisions of the
Committee as to any disputed question arising under the Plan, including
questions of construction and interpretation, shall be final, conclusive and
binding on all parties.
ARTICLE 4. ELIGIBILITY AND PARTICIPATION
4.1 ELIGIBILITY. Employees eligible to participate in the Plan
include key policy-makers and decision-makers of the Company, as selected by
the Committee in its sole discretion. It is the intent of the Company to
extend eligibility only to those executives who comprise a select group of
management or highly compensated employees, such that the Plan will qualify for
treatment as a "Top Hat" plan under ERISA.
In the event a Participant no longer meets the requirements for
participation in the Plan, such Participant shall become an inactive
Participant, retaining all the rights described under the Plan, except the
right to make any further deferrals, until such time that the Participant again
becomes an active Participant.
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4.2 PARTICIPATION. Participation in the Plan shall be determined
annually by the Committee based upon the criteria set forth in Section 4.1
herein. Employees who are chosen to participate in the Plan in any given year
shall be so notified in writing.
4.3 PARTIAL YEAR ELIGIBILITY. In the event that an Employee first
becomes eligible to participate in the Plan during any given year, such
Employee shall as soon as practicable be so notified in writing by the Company
and provided with an "Election to Defer Form," which must be completed by the
Employee as provided in Section 5.2 herein; provided, however, that such
Employee may only make an election to defer with respect to that portion of his
or her Compensation for such year which is to be paid after the date of filing
of the deferral election.
4.4 NO RIGHT TO PARTICIPATE. No Employee shall have the right to
be selected as a Participant, or, having been so selected for any given year,
to be selected again as a Participant for any other year.
ARTICLE 5. DEFERRAL OPPORTUNITY
5.1 AMOUNT WHICH MAY BE DEFERRED. A Participant may elect to
defer up to one hundred percent (100%) of eligible components of Compensation,
including but not limited to Salary, Bonus and Long-Term Awards, in any given
year; provided, however, that the Committee shall have sole discretion to
designate which components of Compensation are eligible for deferral elections
under the Plan in any such year. The minimum amount of any single eligible
component of Compensation which may be deferred in any given year is the lesser
of ten percent (10%) of such component or ten thousand dollars ($10,000). In
addition, an election to defer Compensation in any given year shall be
expressed by each Participant in increments of either ten percent (10%) of the
applicable component of Compensation or ten thousand dollars ($10,000).
5.2 DEFERRAL ELECTION. Participants shall make their elections to
defer Bonuses under the Plan for a given fiscal year not later than (a) thirty
(30) days prior to the beginning of such fiscal year or (b) if Participants are
notified after the beginning of the fiscal year of their selection to
participate in the Plan for such fiscal year or a partial fiscal year, within
thirty (30) days of receipt of such notice. Elections to defer Salary under
the Plan for a given calendar year shall be made not later than (x) thirty (30)
days prior to the beginning of such calendar year or (y) if Participants are
notified after the beginning of the calendar year of their selection to
participate in the Plan for such calendar year or a partial calendar year,
within thirty (30) days of receipt of such notice. Elections to defer
Long-Term Awards and other payments eligible for deferral under the Plan shall
be made in accordance with the foregoing rules for fiscal or calendar years, as
the Committee deems appropriate. All deferral elections shall be irrevocable;
shall relate solely to amounts earned after the filing of a deferral election
with the Committee; and shall be made on an "Election to Defer Form," as
described herein.
Participants shall make the following irrevocable elections on each
"Election to Defer Form":
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(a) The amount to be deferred with respect to each eligible
component of Compensation for the specified year;
(b) The length of the deferral period with respect to each
eligible component of Compensation, pursuant to the terms of
Section 5.3 herein;
(c) The form of payment to be made to the Participant at the end
of the deferral period(s), pursuant to the terms of Section
5.4 herein; and
(d) The interest rate alternative(s) with respect to deferrals of
Compensation, pursuant to Section 6.2 herein.
5.3 LENGTH OF DEFERRAL. The deferral periods elected by each
Participant with respect to deferrals of Compensation for any given year shall
be selected from among the choices specified by the Committee. The Committee
shall specify one or more deferral periods which are at least one (1) year
following the end of the calendar year in which the Compensation is earned, and
no greater than ten (10) years following such date; provided, that in no event
shall the deferral period extend beyond the end of the calendar year in which
the Participant reaches the age of 65. If the Committee does not specify one
or more deferral periods, the deferral period choices shall be five (5) years
and ten (10) years. Notwithstanding the deferral periods elected by a
Participant, payment of deferred amounts and accumulated interest thereon shall
be made to the Participant, or the Participant's beneficiary designated
pursuant to Section 6.4 hereof, as the case may be, in a single lump sum in the
event the Participant's employment with the Company is terminated by reason of
death or Disability at any time prior to scheduled payment of deferred amounts
and interest thereon. Such payment following employment termination shall be
made in cash, within thirty (30) days after the effective date of termination
of the Participant's employment.
5.4 PAYMENT OF DEFERRED AMOUNTS. Subject to the provisions of
Section 5.5, 5.6 and Article 9 of the Plan, Participants shall receive payment
of deferred amounts, together with interest earned thereon, at the end of the
deferral period in a single lump-sum cash payment or, if approved by the
Committee, by the Participant electing another means of payment such as in
installments. If alternative methods for receiving payment are approved by the
Committee, elections of the method of payment shall be made by the Participant
within the same time periods as required in Section 5.2 of the Plan.
(a) LUMP-SUM PAYMENT. A lump sum payment shall be made in cash
within sixty (60) days of the end of the deferral period
specified by the Participant, as described in Sections 5.2 and
5.3 herein.
(b) INSTALLMENT PAYMENTS. If approved by the Committee,
Participants may elect payout in annual installments, with a
minimum number of installments of two (2), and a maximum of
fifteen (15). The initial payment shall be made in cash
within sixty (60) days after the commencement date selected by
the Participant pursuant
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to Sections 5.2 and 5.3 herein. The remaining installment
payments shall be made in cash each year thereafter, until the
Participant's entire deferred compensation account has been
paid. Interest shall accrue on the deferred amounts in the
Participant's deferred compensation account, as provided in
Section 6.2 of the Plan. The amount of each installment
payment shall be equal to the balance remaining in the
Participant's deferred compensation account immediately prior
to each such payment, multiplied by a fraction, the numerator
of which is one (1), and the denominator of which is the
number of installment payments remaining.
(c) ALTERNATIVE PAYMENT SCHEDULE. If approved by the Committee, a
Participant may elect an alternate payment schedule.
5.5 FINANCIAL HARDSHIP. The Committee shall have the authority to
alter the timing or manner of payment of deferred amounts in the event that the
Participant establishes, to the satisfaction of the Committee, severe financial
hardship. In such event, the Committee may, in its sole discretion:
(a) Authorize the cessation of deferrals by such Participant under
the Plan;
(b) Provide that all, or a portion, of the amount previously
deferred by the Participant shall immediately be paid in a
lump-sum cash payment;
(c) Provide that all, or a portion, of the installments payable
over a period of time shall immediately be paid in a lump-sum
cash payment; or
(d) Provide for another installment payment schedule as deemed
appropriate by the Committee under the circumstances.
For purposes of this Section 5.5, "severe financial hardship" shall
mean any financial hardship resulting from extraordinary and unforeseeable
circumstances arising as a result of one or more recent events beyond the
control of the Participant. In any event, payment may not be made to the
extent such emergency is or may be relieved: (i) through reimbursement or
compensation by insurance or otherwise; (ii) by liquidation of the
Participant's assets, to the extent the liquidation of such assets would not
itself cause severe financial hardship; or (iii) by cessation of existing
deferrals or new deferrals under the Plan.
Withdrawals of deferred amounts because of a severe financial hardship
may only be permitted to the extent reasonably necessary to satisfy the
hardship. Examples of what are not considered to be severe financial hardships
include the need to send a Participant's child to college or the desire to
purchase a home. The Participant's account will be credited with earnings (and
debited for any losses) in accordance with the Plan up to the date of
distribution.
The severity of the financial hardship shall be judged by the
Committee. The Committee's decision with respect to the severity of financial
hardship and the manner in which, if at all, the Participant's future deferral
opportunities shall be eliminated, and/or the manner in which, if at all,
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the payment of deferred amounts to the Participant shall be altered or
modified, shall be final, conclusive and not subject to appeal.
5.6 CHANGE IN CONTROL. Notwithstanding any provision contained in
the Plan, in the event of a Change in Control, the Committee in its sole
discretion may direct that all or certain Participants shall be entitled to an
immediate lump sum payment of their deferred amounts, together with interest
earned thereon.
ARTICLE 6. DEFERRED COMPENSATION ACCOUNTS
6.1 PARTICIPANTS' ACCOUNTS. The Company shall establish and
maintain an individual bookkeeping account for deferrals made by each
Participant under Article 5 herein. Each account shall be credited as of the
date the amount deferred otherwise would have become due and payable to the
Participant.
6.2 INTEREST ON DEFERRED AMOUNTS. Compensation deferred under
Article 5 shall accrue interest on a basis to be specified by the Committee,
consistent with the provisions of Section 162(m) of the Code and the rules and
regulations promulgated thereunder, at a rate equal to the return on the rate
of return choice(s) selected by the Participant from among the alternatives
specified by the Committee from time to time. Interest credited on deferred
amounts (less the amount of any debits for any losses) shall be paid out to
Participants at the same time and in the same manner as the underlying deferred
amounts.
6.3 CHARGES AGAINST ACCOUNTS. There shall be charged against each
Participant's deferred compensation account any payments made to the
Participant or to his or her beneficiary.
6.4 DESIGNATION OF BENEFICIARY. Each Participant may designate a
beneficiary or beneficiaries (who may be named contingently or successively)
who, upon the Participant's death, will receive the amounts that otherwise
would have been paid to the Participant under the Plan. All designations shall
be signed by the Participant, and shall be in such form as prescribed by the
Committee. Each designation shall be effective as of the date received from
the Participant by the Corporate Secretary of the Company.
Participants may change their designations of beneficiary on a form
prescribed by the Committee. The payment of amounts deferred under the Plan
shall be in accordance with the last unrevoked written designation of
beneficiary that has been signed by the Participant and delivered by the
Participant to the Corporate Secretary of the Company prior to the
Participant's death.
In the event that all the beneficiaries named by a Participant
pursuant to this Section 6.4 predecease the Participant, the deferred amounts
that would have been paid to the Participant or the Participant's beneficiaries
shall be paid to the Participant's estate.
In the event a Participant does not designate a beneficiary, or for
any reason such designation is ineffective, in whole or in part, the amounts
that otherwise would have been paid to
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the Participant or the Participant's beneficiaries under the Plan shall
be paid to the Participant's estate.
ARTICLE 7. RIGHTS OF PARTICIPANTS
7.1 CONTRACTUAL OBLIGATION. The Plan shall create a contractual
obligation on the part of the Company to make payments from the Participants'
accounts when due. Payment of account balances shall be made out of the
general funds of the Company.
7.2 UNSECURED INTEREST. No Participant, or party claiming an
interest in deferred amounts or contributions through a Participant, shall have
any interest whatsoever in any specific asset of the Company. To the extent
that any party acquires a right to receive payments under the Plan, such right
shall be equivalent to that of an unsecured general creditor of the Company.
The Company may establish one or more trusts, with such trustee(s) as
the Committee may approve, for the purpose of providing for the payment of
deferred amounts. Any such trust created by the Company will conform to the
terms of the model trust approved by the Internal Revenue Service pursuant to
Revenue Procedure 92-64, or any amendment thereof or successor procedure
thereto. Such trust or trusts may be irrevocable, but the assets thereof shall
be subject to the claims of the Company's general creditors. To the extent any
deferred amounts under the Plan are actually paid from any such trust, the
Company shall have no further obligation with respect thereto, but to the
extent not so paid, such deferred amounts shall remain the obligation of, and
shall be paid by, the Company.
7.3 EMPLOYMENT. Nothing in the Plan shall interfere with nor
limit in any way the right of the Company to terminate any Participant's
employment at any time, nor confer upon any Participant any right to continue
in the employ of the Company.
ARTICLE 8. WITHHOLDING OF TAXES
The Company shall withhold from an employee's regular compensation
from the Company an amount sufficient to satisfy foreign, Federal, state, and
local income or other withholding tax requirements with regard to amounts
deferred under the Plan. However, the Company reserves the right to institute
alternative methods for satisfying the applicable income and withholding tax
requirements.
ARTICLE 9. AMENDMENT AND TERMINATION
The Company hereby reserves the right to amend, modify or terminate
the Plan at any time by action of the Committee or the Board of Directors.
Except as described below in this Article 9, no such amendment, modification or
termination shall in any material manner adversely affect any Participant's
rights to deferred amounts, contributions or interest earned thereon, without
the consent of the Participant.
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The Plan is intended to be an unfunded plan maintained primarily to
provide deferred compensation benefits for a select group of "management or
highly compensated employees" within the meaning of Sections 201, 301 and 401
of ERISA, and therefore to be exempt from the provisions of Parts 2, 3 and 4 of
Title I of ERISA. Accordingly, the Board may terminate the Plan and commence
termination payout for all or certain Participants, or remove certain employees
as Participants, if it is determined by the United States Department of Labor
or a court of competent jurisdiction that the Plan constitutes an employee
pension benefit plan within the meaning of Section 3(2) of ERISA which is not
so exempt. If payout is commenced pursuant to the operation of this Article 9,
the payment of such amounts shall be made in a lump sum regardless of the
manner selected by each Participant under Section 5.4 herein as applicable.
ARTICLE 10. MISCELLANEOUS
10.1 NOTICE. Any notice or filing required or permitted to be
given to the Company under the Plan shall be sufficient if in writing and hand
delivered, or sent by registered or certified mail to the Corporate Secretary
of the Company. Notice to the Corporate Secretary, if mailed, shall be
addressed to the principal executive offices of the Company. Notice mailed to
a Participant shall be at such address as is given in the records of the
Company. Notices shall be deemed given as of the date of delivery or, if
delivery is made by mail, as of the date shown on the postmark on the receipt
for registration or certification.
10.2 NONTRANSFERABILITY. Participants' rights to deferred amounts
and interest earned thereon under the Plan may not be sold, transferred,
assigned or otherwise alienated or hypothecated other than by will or by the
laws of descent and distribution. In no event shall the Company make any
payment under the Plan to any assignee or creditor of a Participant.
10.3 SEVERABILITY. In the event any provision of the Plan shall be
held illegal or invalid for any reason, the illegality or invalidity shall not
affect the remaining parts of the Plan, and the Plan shall be construed and
enforced as if the illegal or invalid provision had not been included.
10.4 GENDER AND NUMBER. Except where otherwise indicated by the
context, any masculine term used herein also shall include the feminine; the
plural shall include the singular, and the singular shall include the plural.
10.5 COSTS OF THE PLAN. All costs of implementing and
administering the Plan shall be borne by the Company.
10.6 APPLICABLE LAW. The Plan shall be construed and enforced in
accordance with the provisions of ERISA. In the event that ERISA is not
applicable or does not preempt State law, the laws of the State of Georgia
shall govern.
10.7 SUCCESSORS. All obligations of the Company under the Plan
shall be binding on any successor to the Company, whether the existence of such
successor is the result of a direct or indirect purchase, merger,
consolidation, or otherwise, of all or substantially all of the business and/or
assets of the Company.
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