Delta Air Lines Commences Tender Offers and Consent Solicitation for Its 9-1/2% Senior Secured Notes Due 2014 and 11-3/4% Senior Second Lien Notes Due 2015
ATLANTA, Oct. 1, 2012 /PRNewswire/ — Delta Air Lines, Inc. (NYSE: DAL) today announced the commencement of cash tender offers relating to any and all of its $600,000,000 current outstanding principal amount of 9½% Senior Secured Notes due 2014 (the “9½% Notes“) and its $306,185,000 current outstanding principal amount of 11¾% Senior Second Lien Notes due 2015 (the “11¾% Notes,” and together with the 9½% Notes, the “Notes“) and its solicitation of consents from the holders of the Notes to adopt certain amendments to the indentures governing the Notes.
The Notes and other information related to the tender offers are listed below:
Current Principal Amount Outstanding Early Tender Payment(1) Series of Notes Offer Consideration(1) Total Consideration(1) Early Tender CUSIP Nos. Deadline Expiration Time --- ---------- -------- --------------- 91/2% 5:00 P.M. Eastern Time, 11:59 P.M. Eastern Time, Senior October 15, 2012 October 29, 2012 Secured Notes due 2014 247361ZC5 $600,000,000 $1,022.50 $30.00 $1,052.50 U24740AH2 113/4% 5:00 P.M. Eastern Time, 11:59 P.M. Eastern Time, Senior October 15, 2012 October 29, 2012 Second Lien Notes due 2015(2) 247361ZE1 $306,185,000(3) $1,065.00 $30.00 $1,095.00 U24740AJ8
(1) For each $1,000 principal amount of Notes, excluding accrued but unpaid interest thereon, which interest will be paid in addition to the Offer Consideration or the Total Consideration, as applicable. The Total Consideration includes the Early Tender Payment.
(2) The current interest rate of the 11¾% Notes is 12¼% due to additional interest applicable to these Notes.
(3) Excludes Notes held by the Company.
The tender offers are scheduled to expire at 11:59 P.M., Eastern Time, on October 29, 2012, unless extended or earlier terminated (the “Expiration Time“). Holders who validly tender their Notes and deliver their consents by 5:00 P.M., Eastern Time, on October 15, 2012, unless extended or earlier terminated (the “Early Tender Deadline“), will receive $1,052.50 and $1,095.00 per $1,000 principal amount of 9½% Notes and 11¾% Notes, respectively, (the “Total Consideration“) if such Notes are accepted for purchase, which includes an early tender payment of $30.00 per $1,000 principal amount of Notes (the “Early Tender Payment“). Holders who validly tender their Notes and deliver their consents after the Early Tender Deadline but by the Expiration Time will receive $1,022.50 and $1,065.00 per $1,000 principal amount of 9½% Notes and 11¾% Notes, respectively, (the “Offer Consideration“) if such Notes are accepted for purchase. Holders whose tendered Notes are accepted for purchase will also receive accrued and unpaid interest from the most recent interest payment date for the Notes, to, but not including, the applicable payment date for the Notes in the tender offers.
Holders who validly tender their Notes and deliver their consents by the Early Tender Deadline, and whose Notes are accepted for purchase, will receive payment promptly after the Early Tender Deadline. Holders who validly tender their Notes and deliver their consents after the Early Tender Deadline but by the Expiration Time, and whose Notes are accepted for purchase, will receive payment promptly after the Expiration Time.
The tender offers are subject to the satisfaction or waiver of certain conditions, including a financing condition and general conditions. The consents are being solicited to eliminate substantially all of the protective covenants and certain events of default contained in the indentures governing the Notes and–if 75% of holders participate–release the collateral securing the Notes. Holders may not tender their Notes without delivering consents or deliver consents without tendering their Notes.
Noteholders may withdraw tenders and revoke consents at any time prior to the earlier of (1) 5:00 P.M., Eastern Time, on October 15, 2012 and (2) the date on which a supplemental indenture is entered into with respect to such series of Notes (the “Withdrawal Deadline“), which is expected to promptly follow receipt of the consents of a majority the outstanding amount of such series.
Delta has retained Barclays Capital Inc. and Goldman, Sachs & Co. to serve as the Dealer Managers for the tender offers and consent solicitation. Questions regarding the tender offers and consent solicitation may be directed to Barclays Capital Inc. at (800) 438-3242 (U.S. toll-free) or (212) 528-7581 (collect) or Goldman, Sachs & Co. at (800) 828-3182 (U.S. toll-free) or (212) 357-6436 (collect). You may also contact your broker, dealer, commercial bank or trust company or other nominee for assistance.
The complete terms and conditions of the tender offers and consent solicitation are described in the Offer to Purchase and Consent Solicitation Statement dated October 1, 2012 and the related Consent and Letter of Transmittal, copies of which may be obtained by contacting D.F. King & Co., Inc., as Tender Agent and Information Agent, at (800) 769-4414 (U.S. toll-free) or (212) 269-5550 (banks and brokers). The Offer to Purchase and related Consent and Letter of Transmittal also address certain U.S. federal income tax consequences. Holders should seek their own advice based on their particular circumstances from an independent tax advisor.
None of Delta, the Dealer Managers, the Tender Agent or the Information Agent makes any recommendations as to whether holders should tender their Notes pursuant to the tender offers or consent to the proposed indenture amendments, and no one has been authorized by any of them to make such recommendations. Holders must make their own decisions as to whether to tender Notes and deliver consents, and, if so, the principal amount of Notes to tender.
This press release does not constitute an offer to purchase, a solicitation of an offer to sell nor a solicitation of consents with respect to, any Notes or other securities, nor shall there be any purchase of Notes or solicitation of consents in any state or jurisdiction in which such offer, solicitation or purchase would be unlawful prior to the registration or qualification under the securities laws of any such jurisdiction. The tender offers and consent solicitation are being made solely by the Offer to Purchase and Consent Solicitation Statement dated October 1, 2012 and related Consent and Letter of Transmittal. In any jurisdiction where the laws require the tender offers and consent solicitation to be made by a licensed broker or dealer, they will be deemed made on behalf of Delta by Barclays Capital Inc., Goldman, Sachs & Co. or one or more registered brokers or dealers under the laws of such jurisdiction. The tender offers and consent solicitation are not being made in any jurisdiction in which the making or acceptance thereof would not be in compliance with the laws of such jurisdiction.
Delta Air Lines serves more than 160 million customers each year. During the past year, Delta was named domestic “Airline of the Year” by the readers of Travel Weekly magazine, was named the “Top Tech-Friendly U.S. Airline” by PCWorld magazine for its innovation in technology, won the Business Travel News Annual Airline Survey and was the recipient of 12 Executive Travel Magazine Leading Edge Awards for U.S. airlines. With an industry-leading global network, Delta and the Delta Connection carriers offer service to nearly 320 destinations in 60 countries on six continents. Headquartered in Atlanta, Delta employs 80,000 employees worldwide and operates a mainline fleet of more than 700 aircraft. A founding member of the SkyTeam global alliance, Delta participates in the industry’s leading trans-Atlantic joint venture with Air France-KLM and Alitalia. Including its worldwide alliance partners, Delta offers customers more than 13,000 daily flights, with hubs in Amsterdam, Atlanta, Cincinnati, Detroit, Memphis, Minneapolis-St. Paul, New York-LaGuardia, New York-JFK, Paris-Charles de Gaulle, Salt Lake City and Tokyo-Narita. The airline’s service includes the SkyMiles frequent flier program, a world-class airline loyalty program; the award-winning BusinessElite service; and more than 50 Delta Sky Clubs in airports worldwide. Delta is investing more than $3 billion through 2013 in airport facilities and global products, services and technology to enhance the customer experience in the air and on the ground. Customers can check in for flights, print boarding passes, check bags and review flight status at delta.com.
Statements in this press release that are not historical facts, including statements regarding our estimates, expectations, beliefs, intentions, projections or strategies for the future, may be “forward-looking statements” as defined in the Private Securities Litigation Reform Act of 1995. All forward-looking statements involve a number of risks and uncertainties that could cause actual results to differ materially from the estimates, expectations, beliefs, intentions, projections and strategies reflected in or suggested by the forward-looking statements. These risks and uncertainties include, but are not limited to, the cost of aircraft fuel; the impact of posting collateral in connection with our fuel hedge contracts; the impact of significant funding obligations with respect to defined benefit pension plans; the impact that our indebtedness may have on our financial and operating activities and our ability to incur additional debt; the restrictions that financial covenants in our financing agreements will have on our financial and business operations; labor issues; interruptions or disruptions in service at one of our hub airports; our increasing dependence on technology in our operations; the ability of our credit card processors to take significant holdbacks in certain circumstances; the possible effects of accidents involving our aircraft; the effects of weather, natural disasters and seasonality on our business; the effects of an extended disruption in services provided by third party regional carriers; our ability to retain management and key employees; competitive conditions in the airline industry; the effects of the rapid spread of contagious illnesses; and the effects of terrorist attacks.
Additional information concerning risks and uncertainties that could cause differences between actual results and forward-looking statements is contained in our Securities and Exchange Commission filings, including our Annual Report on Form 10-K for the fiscal year ended Dec. 31, 2011 and our Quarterly Report on Form 10-Q for the fiscal quarter ended June 30, 2012. Caution should be taken not to place undue reliance on our forward-looking statements, which represent our views only as of October 1, 2012, and which we have no current intention to update.
SOURCE Delta Air Lines, Inc.