Exhibit E: Letter of Understanding – Fees

January 1, 2006

Mr. Gregory E. Davidowitch, President
United Master Executive Council
Association of Flight Attendants-CWA, AFL-CIO
6250 N. River Road, Suite 4020
Rosemont, IL 60018

Re: Fees

Dear Greg:

This Letter confirms the parties’ agreement regarding the AFA-CWA’s fees in the recent negotiations regarding a replacement retirement plan for Flight Attendants:

1. The Company shall reimburse the AFA-CWA for the reasonable, documented, actual fees and out-of-pocket expenses incurred by the AFA-CWA in connection with the review, design, negotiation, approval and ratification of this Letter of Agreement (its “Expenses”) including: the reasonable, actual fees and expenses of the AFA-CWA’s outside pension and other professional advisors (in each case based on normal hourly rates for actual time expended) up to a maximum, aggregate total of $200,000.00, which shall be paid on the Exit Date.  The Company shall not reimburse AFA-CWA for any legal fees or expenses incurred in AFA-CWA’s litigation of the matters set forth in paragraph 1 of the Letter of Agreement.

2. The parties acknowledge and agree that the Company’s agreement to reimburse the AFA-CWA for fees and expenses under the Letter of Agreement is a result of the special circumstances created by the parties’ desire to engage in extraordinary negotiations as part of the Company’s bankruptcy reorganization.

Sincerely,

John Nelson
Director Labor Relations
Onboard Service

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