CHICAGO–(BUSINESS WIRE)–

Fitch Ratings has affirmed the ratings of Industrial Development
Corporation (IDC) of the Port of Seattle’s special facilities revenue
bonds, series 2012 (Delta Air Lines, Inc. Project) at ‘B+’. The rating
Outlook is Positive.

KEY RATING DRIVERS

The rating takes into consideration the following factors: (i) Delta Air
Lines, Inc.’s (DAL’s) credit quality (ii) the structure of the
transaction (iii) Fitch’s view on the likelihood of affirmation of this
lease and ultimate recovery for bondholders in a potential
restructuring. Unlike most airport revenue bonds which are viewed as
unsecured claims of the airline, bondholders in this issue are secured
by the lease between DAL and the Port of Seattle for the property which
holds DAL’s hanger facility.

The issuing entity is the IDC of the Port of Seattle, but it has a
limited obligation on the rated bonds. These bonds are serviced
exclusively by the lease payments from DAL under its financing lease
agreement with the IDC, and DAL also provides an unsecured guarantee.
Furthermore, the bond is secured by the original lease agreement between
DAL and the Port of Seattle for the hanger facility, which enables the
bond trustee to re-lease the facility to a new tenant if DAL decides to
reject the lease in a potential bankruptcy. Accordingly, Fitch believes
that recovery for bondholders in these notes would be higher than DAL
unsecured debt in the event DAL rejected this lease in a potential
restructuring. While this supports recovery in a downside scenario,
Fitch’s base case view is that DAL would likely affirm this lease
obligation in a potential filing (as it did before when Northwest filed
in 2005) given the strategic importance of SEA to DAL. Although SEA is
not a hub or major airport for DAL, it is an important gateway for the
airline on the west coast and a profit center for its maintenance
services.

Fitch has affirmed the following:

Industrial Development Corporation (IDC) of the Port of Seattle special
facilities revenue refunding bonds, series 2012

(Delta Air Lines, Inc. Project):

–$66 million due April 1, 2030 at ‘B+’.

Fitch currently rates Delta Air Lines, Inc. as follows:

–Issuer Default Rating ‘B+’;

–$1.2 billion senior secured revolving credit facility due 2016
‘BB+/RR1’;

–$1.4 billion senior secured term loan due 2017 ‘BB+/RR1’.

Additional information is available at ‘www.fitchratings.com‘

Applicable Criteria and Related Research:

–‘Corporate Rating Methodology’ (Aug. 5, 2013);

–‘Recovery Ratings and Notching Criteria for Nonfinancial Corporate
Issuers’ (Nov. 13, 2012).

Applicable Criteria and Related Research:

Corporate Rating Methodology – Effective from 8 August 2012 – 5 August
2013

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=684460

Recovery Ratings and Notching Criteria for Non-Financial Corporate
Issuers

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=693773

Additional Disclosure

Solicitation Status

http://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=802296

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Fitch Ratings
Primary Analyst
Joe Rohlena, CFA, +1-312-368-3112
Associate Director
Fitch Ratings, Inc.
70 W. Madison Street
Chicago, IL 60602
or
Secondary Analyst
Craig Fraser, +1-212-908-0310
Managing Director
or
Committee Chairperson
Jason Paraschac, +1-212-908-0746
Senior Director
or
Media Relations
Brian Bertsch, +1-212-908-0549 (New York)
brian.bertsch@fitchratings.com