Delta recently used their SkyMiles program to raise $9 billion. As part of this mortgage they had to agree to not devalue the SkyMiles program according to this SEC filing:
Delta and SMIP are also prohibited from substantially reducing the SkyMiles program business or modifying the terms of the SkyMiles program in a manner that would reasonably be expected to materially impair repayment of the SkyMiles Financing obligations (described as a “Payment Material Adverse Effect” in the Indenture and the New Credit Facility), and Delta and its subsidiaries are prohibited from changing the policies and procedures of the SkyMiles program in a manner that would reasonably be expected to have a Payment Material Adverse Effect or operating a competing loyalty program.
The non devaluation clause is pretty vague, as long as it doesn’t materially impair repayment of SkyMiles Financing obligations then Delta can basically do as they please. There is also a non-compete clause, those backing the financing obviously don’t want to end up in a situation where Delta just creates a new mileage program (similar to what was going to happen with Aeroplan).
Hat tip to VFTW
