Delta Air Lines today announced that it has completed a private placement
of $325 million aggregate principal amount of 2-7/8 percent Convertible
Senior Notes due 2024, issued to a qualified institutional buyer pursuant
to Rule 144A under the Securities Act of 1933, as amended (the “Securities
The net proceeds from the offering were made available for general
Delta has granted the initial purchaser of the notes a 30-day option to
purchase up to an additional $65 million principal amount of the notes.
Interest on the notes will be 2-7/8 percent per $1,000 principal amount
and will be payable in cash in arrears semi-annually through Feb. 18,
2024. Each note will be convertible into Delta common stock at a
conversion rate of 73.6106 shares per $1,000 principal amount of notes
(subject to adjustment in certain circumstances), which is equivalent to a
conversion price of approximately $13.59 per share of Delta common stock.
Holders of the notes may convert their notes only if (i) the price of
Delta’s common stock reaches a specified threshold; (ii) the trading price
for the notes falls below certain thresholds; (iii) the notes have been
called for redemption; or (iv) specified corporate transactions occur.
Delta may redeem all or some of the notes for cash at any time on or after
Feb. 21, 2009, at a redemption price equal to the principal amount of the
notes plus any accrued and unpaid interest to the redemption date. Holders
may require Delta to repurchase the notes on Feb. 18 of 2009, 2014 and
2019, or in other specified circumstances, at a repurchase price equal to
the principal amount due plus any accrued and unpaid interest to the
The notes being offered and the common stock issuable upon conversion of
the notes have not been registered under the Securities Act, or any state
securities laws, and unless so registered, may not be offered or sold in
the United States except pursuant to an exemption from, or in a
transaction not subject to, the registration requirements of the
Securities Act and applicable state securities laws.