<PAGE>
As filed with the Securities and Exchange Commission on April 7, 1998.
Registration No. 333-
- --------------------------------------------------------------------------------
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
DELTA AIR LINES, INC.
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 58-0218548
- ------------------------------- ------------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
Hartsfield Atlanta International Airport, Atlanta, Georgia 30320
- ----------------------------------------------------------- ----------
(Address of Principal Executive Offices) (Zip Code)
1989 STOCK INCENTIVE PLAN
OF DELTA AIR LINES, INC.
------------------------------------
(Full title of the plan)
Robert S. Harkey, Esq.
Senior Vice President - General Counsel & Secretary
Delta Air Lines, Inc.
Hartsfield Atlanta International Airport
Atlanta, Georgia 30320
----------------------------------------------------------
(Name and address of agent for service)
(404) 715-2387
-------------------------------------------------------------
(Telephone number, including area code, of agent for service)
___________________________
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
Proposed Proposed
Title of maximum maximum
securities Amount offering aggregate Amount of
to be to be price per offering registration
registered registered (1) share (2) price (2) fee
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock,
par value $3.00 per share 3,800,000 shares $117.00 $444,600,000 $131,157
Rights (3) -- -- -- --
- -------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) In addition, pursuant to Rule 416(a) under the Securities Act of 1933, this
registration statement also covers an indeterminate number of shares of
Common Stock of Registrant which may become issuable pursuant to
Registrant's 1989 Stock Incentive Plan by reason of applicable anti-
dilution provisions.
(2) Estimated solely for the purpose of computing the registration fee pursuant
to Rule 457(h) under the Securities Act of 1933, on the basis of the
average of the high and low sales prices per share of Common Stock of
Registrant as reported on the New York Stock Exchange on April 2, 1998.
(3) Each share of Common Stock of Registrant includes one preferred stock
purchase right ("Right") to be issued pursuant to the terms and conditions
of the Rights Agreement dated as of October 24, 1996, between Registrant
and First Chicago Trust Company of New York, as Rights Agent. Each Right,
when exercisable, would entitle its registered holder to purchase one one-
hundredth of a share of Series D Junior Participating Preferred Stock of
Registrant at an exercise price of $300, subject to adjustment in certain
circumstances. The Rights will expire at the close of business on November
4, 2006, unless earlier exchanged or redeemed by Registrant.
Pursuant to Rule 429, this Registration Statement also relates to 8,070,240
shares of Common Stock of the Company reserved for issuance under the Plan as of
December 31, 1997 which were previously registered under a Form S-8 Registration
Statement (File No. 33-52045).
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The following documents have been previously filed by Delta Air Lines, Inc.
("Delta" or the "Company") with the Securities and Exchange Commission and are
hereby incorporated by reference into this Registration Statement as of their
respective dates:
(a) Annual Report on Form 10-K for the fiscal year ended June 30, 1997;
(b) Quarterly Report on Form 10-Q for the quarter ended September 30,
1997;
(c) Quarterly Report on Form 10-Q for the quarter ended December 31, 1997;
and
(d) The description of the Company's Common Stock which is contained in
its registration statement filed under Section 12 of the Securities Exchange Act
of 1934 (the "Exchange Act"), including all amendments and reports filed for the
purpose of updating such description.
All documents filed by the Company pursuant to Sections 13(a), 13(c), 14 or
15(d) of the Exchange Act subsequent to the date of this Registration Statement
and prior to the filing of a post-effective amendment to this Registration
Statement that indicates that all securities registered hereunder have been sold
or that deregisters all such securities then remaining unsold shall be deemed to
be incorporated by reference into this Registration Statement and to be a part
hereof from the date of filing of such documents. Any statement contained in a
document incorporated or deemed incorporated by reference herein shall be deemed
to be modified or superseded for purposes of this Registration Statement to the
extent that a statement contained herein or in any other subsequently filed
document which also is or is deemed to be incorporated by reference herein
modifies or supersedes such statement. Any such statement so modified or
superseded shall not be deemed, except as so modified or superseded, to
constitute a part of this Registration Statement.
ITEM 4. DESCRIPTION OF SECURITIES.
Not applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
The legality of the shares of Common Stock and the Rights attached thereto
has been passed upon for the Company by Robert S. Harkey, Esq., Senior Vice
President - General Counsel & Secretary of the Company. At March 31, 1998, Mr.
Harkey beneficially owned 11,327 shares of Common Stock of the Company; had
options to purchase 66,500 shares of Common Stock of the Company under the Plan;
and beneficially owned 86 shares of Series B ESOP Convertible Preferred Stock of
the Company.
-2-
<PAGE>
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 102 of the Delaware General Corporation Law ("DGCL") allows a
corporation to eliminate or limit the personal liability of directors of a
corporation to the corporation or to its stockholders for monetary damages for a
breach of fiduciary duty as a director, except (i) for breach of the director's
duty of loyalty, (ii) for acts or omissions not in good faith or which involve
intentional misconduct or a knowing violation of law, (iii) for certain unlawful
dividends and stock repurchases or (iv) for any transaction from which the
director derived an improper personal benefit. Article Eighteenth of the
Certificate of Incorporation of Delta provides that no director shall be
personally liable to Delta or its stockholders for monetary damages for any
breach of his fiduciary duty as a director, except as provided in Section 102 of
the DGCL.
Section 145 of the DGCL provides that in the case of any action other than
one by or in the right of the corporation, a corporation may indemnify any
person who was or is a party or is threatened to be made a party to any
threatened, pending or completed action, suit or proceeding, whether civil,
criminal, administrative or investigative, by reason of the fact that such
person is or was a director, officer, employee or agent of the corporation, or
is or was serving at the request of the corporation in such capacity on behalf
of another corporation, partnership, joint venture, trust or other enterprise,
against expenses (including attorneys' fees), judgments, fines and amounts paid
in settlement actually and reasonably incurred by him in connection with such
action if he acted in good faith and in a manner he reasonably believed to be in
or not opposed to the best interests of the corporation and, with respect to any
criminal action or proceeding, had no reasonable cause to believe his conduct
was unlawful.
Section 145 of the DGCL provides that in the case of an action by or in the
right of a corporation to procure a judgment in its favor, a corporation may
indemnify any person who was or is a party or is threatened to be made a party
to any threatened, pending or completed action or suit by reason of the fact
that such person is or was a director, officer, employee or agent of the
corporation, or is or was serving at the request of the corporation in such
capacity on behalf of another corporation, partnership, joint venture, trust or
other enterprise, against expenses (including attorneys' fees) actually and
reasonably incurred by him in connection with the defense or settlement of such
action or suit if he acted under standards similar to those set forth in the
preceding paragraph, except that no indemnification may be made in respect of
any action or claim as to which such person shall have been adjudged to be
liable to the corporation unless a court determines that such person is fairly
and reasonably entitled to indemnification.
Article Tenth of Delta's Certificate of Incorporation provides that Delta
shall to the extent permitted by law indemnify any person for all liabilities
incurred by or imposed upon him as a result of any actual or threatened action,
suit or proceeding, whether civil, criminal, administrative or investigative, in
which he shall be involved by reason of that fact that he is or was serving as a
director, officer or employee of Delta, or, that, at the request of Delta, he is
or was serving another corporation or enterprise in any capacity.
Delta has purchased and maintains at its expense, on behalf of directors
and officers, insurance, within certain limits, covering liabilities that may be
incurred by them in such capacities.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not applicable.
-3-
<PAGE>
ITEM 8. EXHIBITS.
4.1 Delta's Certificate of Incorporation (Filed as Exhibit 4.1 to Delta's
Registration Statement on Form S-8 (Registration No. 333-16471)).*
4.2 Delta's By-Laws (Filed as Exhibit 3.2 to Delta's Quarterly Report on
Form 10-Q for the quarter ended December 31, 1997).*
4.3 Rights Agreement dated as of October 24, 1996, between Delta and
First Chicago Trust Company of New York, as Rights Agent (Filed as
Exhibit 1 to Delta's Form 8-A/A Registration Statement dated November
4, 1996).*
4.4 1989 Stock Incentive Plan of Delta Air Lines, Inc., as amended.
5 Opinion of Robert S. Harkey, Esq., regarding legality of shares being
registered.
15 Arthur Andersen LLP letter regarding unaudited financial information.
23(a) Consent of Robert S. Harkey, Esq. (included in Exhibit 5).
23(b) Consent of Arthur Andersen LLP.
24 Powers of Attorney.
- --------------------------------
* Incorporated herein by reference.
ITEM 9. UNDERTAKINGS.
The undersigned registrant hereby undertakes:
(a) (1) To file, during any period in which offers or sales are being made,
a post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after the
effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set
forth in the registration statement;
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the registration statement
or any material change to such information in the registration
statement;
provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if
the registration statement is on Form S-8, and the information required to be
included in a post-effective amendment by those paragraphs is contained in
periodic reports filed with or furnished to the Commission by the registrant
pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 that are
incorporated by reference in the registration statement.
-4-
<PAGE>
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed to be
a new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of the
offering.
(b) That, for purposes of determining any liability under the Securities Act of
1933, each filing of the registrant's annual report pursuant to Section 13(a) or
Section 15(d) of the Securities Exchange Act of 1934 (and, where applicable,
each filing of an employee benefit plan's annual report pursuant to Section
15(d) of the Securities Exchange Act of 1934) that is incorporated by reference
in the registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of the
registrant pursuant to the provisions referred to in Item 6 of this registration
statement, or otherwise, the registrant has been advised that in the opinion of
the Securities and Exchange Commission such indemnification is against public
policy as expressed in the Act and is, therefore, unenforceable. In the event
that a claim for indemnification against such liabilities (other than the
payment by the registrant of expenses incurred or paid by a director, officer or
controlling person of the registrant in the successful defense of any action,
suit or proceeding) is asserted by such director, officer or controlling person
in connection with the securities being registered, the registrant will, unless
in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the Act and
will be governed by the final adjudication of such issue.
-5-
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Atlanta, and State of Georgia, on the 6th day of
April, 1998.
DELTA AIR LINES, INC.
By: /s/ Leo F. Mullin
------------------------------
Leo F. Mullin
President and Chief Executive
Officer
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below on the 6th day of April, 1998, by
the following persons on behalf of the registrant and in the capacities
indicated.
SIGNATURE TITLE
- --------- -----
/s/ Leo F. Mullin Director, President and
- ----------------------------- Chief Executive Officer
Leo F. Mullin (Principal Executive Officer)
Edwin L. Artzt* Director
- -----------------------------
Edwin L. Artzt
Henry A. Biedenharn, III* Director
- -----------------------------
Henry A. Biedenharn, III
James L. Broadhead* Director
- -----------------------------
James L. Broadhead
Edward H. Budd* Director
- -----------------------------
Edward H. Budd
R. Eugene Cartledge* Director
- -----------------------------
R. Eugene Cartledge
-6-
<PAGE>
Mary Johnston Evans* Director
- -----------------------------
Mary Johnston Evans
Gerald Grinstein* Non-Executive Chairman of the Board
- ----------------------------- and Director
Gerald Grinstein
Jesse Hill, Jr.* Director
- -----------------------------
Jesse Hill, Jr.
Andrew J. Young* Director
- -----------------------------
Andrew J. Young
/s/ Edward H. West Chief Financial Officer (Acting)
- ----------------------------- (Principal Financial Officer
Edward H. West and Principal Accounting Officer)
*By: /s/ Edward H. West Attorney-In-Fact
- -----------------------------
Edward H. West
-7-
<PAGE>
EXHIBIT INDEX
Exhibit No. Description of Exhibits
- ---------------- --------------------------------------------------------------
4.1 Delta's Certificate of Incorporation (Filed as Exhibit 4.1 to
Delta's Registration Statement on Form S-8 (Registration No.
333-16471)).*
4.2 Delta's By-Laws (Filed as exhibit 3.2 to Delta's Quarterly
Report on Form 10-Q for the quarter ended December 31, 1997).*
4.3 Rights Agreement dated as of October 24, 1996, between Delta
and First Chicago Trust Company of New York, as Rights Agent
(Filed as Exhibit 1 to Delta's Form 8-A/A Registration
Statement dated November 4, 1996).*
4.4 1989 Stock Incentive Plan of Delta Air Lines, Inc., as amended
5 Opinion of Robert S. Harkey, Esq., regarding legality of
shares being registered.
15 Arthur Andersen LLP letter regarding unaudited financial
information.
23(a) Consent of Robert S. Harkey, Esq. (included in Exhibit 5).
23(b) Consent of Arthur Andersen LLP
24 Powers of Attorney.
- ---------------
* Incorporated herein by reference.
-8-
<PAGE>
EXHIBIT 4.4
-----------
1989 STOCK INCENTIVE PLAN
OF
DELTA AIR LINES, INC.
---------------------
As Amended Effective October 23, 1997
SECTION 1. Purpose; Definitions.
The purpose of this plan, which shall be known as the "1989 Stock Incentive Plan
of Delta Air Lines, Inc." (the "Plan"), is to promote the interests of Delta Air
Lines, Inc. (the "Company") by attracting and retaining in its employment
persons of outstanding ability, and to provide present and future officers and
key employees of the Company, or any of its present or future Subsidiaries,
greater incentive to make material contributions to the success of the Company
by increasing their proprietary interest in the welfare and success of the
Company through increased direct stock ownership and other incentives related to
the value of the stock, all to the benefit of the Company and its shareholders.
For purposes of the Plan, the following terms shall be defined as set forth
below:
"Affiliate" and "Associate" have the respective meanings accorded to such
terms in Rule 12b-2 under the Exchange Act as in effect on July 24, 1997.
"Beneficial Ownership". A Person shall be deemed the "Beneficial Owner"
of, and shall be deemed to " beneficially own," securities pursuant to Rule
13d-3 under the Exchange Act as in effect on July 24, 1997.
"Board" or "Board of Directors" means the Board of Directors of the
Company.
"Change in Control" means, and shall be deemed to have occurred upon, the
first to occur of any of the following events:
(a) Any Person (other than an Excluded Person) acquires, together with
all Affiliates and Associates of such Person, Beneficial Ownership of
securities representing 20% or more of the combined voting power of the
Voting Stock then outstanding, unless such Person acquires Beneficial
Ownership of 20% or more of the combined voting power of the Voting Stock
then outstanding solely as a result of an acquisition of Voting Stock by
the Company which, by reducing the Voting Stock outstanding, increases
the proportionate Voting Stock beneficially owned by such Person
(together with all Affiliates and Associates of such Person) to 20% or
more of the combined voting power of the Voting Stock then outstanding;
provided, that if a Person shall become the Beneficial Owner of 20% or
--------
more of the combined voting power of the Voting Stock then outstanding by
reason of such Voting Stock acquisition by the Company and shall
thereafter become the Beneficial Owner of any additional Voting Stock
which causes the proportionate voting power of Voting Stock beneficially
owned by such Person to increase to 20% or more of the combined voting
power of the Voting Stock then outstanding, such Person shall, upon
becoming the
<PAGE>
Beneficial Owner of such additional Voting Stock, be deemed to have
become the Beneficial Owner of 20% or more of the combined voting power
of the Voting Stock then outstanding other than solely as a result of
such Voting Stock acquisition by the Company;
(b) During any period of two consecutive years (not including any
period prior to July 24, 1997), individuals who at the beginning of such
period constitute the Board (and any new Director, whose election by the
Board or nomination for election by the Company's stockholders was
approved by a vote of at least two-thirds of the Directors then still in
office who either were Directors at the beginning of the period or whose
election or nomination for election was so approved), cease for any
reason to constitute a majority of Directors then constituting the Board;
(c) A reorganization, merger or consolidation of the Company is
consummated, in each case, unless, immediately following such
reorganization, merger or consolidation, (i) more than 50% of,
respectively, the then outstanding shares of common stock of the
corporation resulting from such reorganization, merger or consolidation
and the combined voting power of the then outstanding voting securities
of such corporation entitled to vote generally in the election of
directors is then beneficially owned, directly or indirectly, by all or
substantially all of the individuals and entities who were the beneficial
owners of the Voting Stock outstanding immediately prior to such
reorganization, merger or consolidation, (ii) no Person (but excluding
for this purpose any Excluded Person and any Person beneficially owning,
immediately prior to such reorganization, merger or consolidation,
directly or indirectly, 20% or more of the voting power of the
outstanding Voting Stock) beneficially owns, directly or indirectly, 20%
or more of, respectively, the then outstanding shares of common stock of
the corporation resulting from such reorganization, merger or
consolidation or the combined voting power of the then outstanding voting
securities of such corporation entitled to vote generally in the election
of directors and (iii) at least a majority of the members of the board of
directors of the corporation resulting from such reorganization, merger
or consolidation were members of the Board at the time of the execution
of the initial agreement providing for such reorganization, merger or
consolidation; or
(d) The shareholders of the Company approve (i) a complete liquidation
or dissolution of the Company or (ii) the sale or other disposition of
all or substantially all of the assets of the Company, other than to any
corporation with respect to which, immediately following such sale or
other disposition, (A) more than 50% of, respectively, the then
outstanding shares of common stock of such corporation and the combined
voting power of the then outstanding voting securities of such
corporation entitled to vote generally in the election of directors is
then beneficially owned, directly or indirectly, by all or substantially
all of the individuals and entities who were the beneficial owners of the
Voting Stock outstanding immediately prior to such sale or other
disposition of assets, (B) no Person (but excluding for this purpose any
Excluded Person and any Person beneficially owning, immediately prior to
such sale or other
-2-
<PAGE>
disposition, directly or indirectly, 20% or more of the voting power of
the outstanding Voting Stock) beneficially owns, directly or indirectly,
20% or more of, respectively, the then outstanding shares of common stock
of such corporation or the combined voting power of the then outstanding
voting securities of such corporation entitled to vote generally in the
election of directors and (C) at least a majority of the members of the
board of directors of such corporation were members of the Board at the
time of the execution of the initial agreement or action of the Board
providing for such sale or other disposition of assets of the Company.
Notwithstanding the foregoing, in no event shall a Change in Control be
deemed to have occurred (i) as a result of the formation of a Holding
Company, or (ii) with respect to a Participant, if Participant is part of a
"group," within the meaning of Section 13(d)(3) of the Exchange Act as in
effect on July 24, 1997, which consummates the Change in Control
transaction. In addition, for purposes of the definition of Change in
Control a Person engaged in business as an underwriter of securities shall
not be deemed to be the Beneficial Owner of, or to "beneficially own," any
securities acquired through such Person's participation in good faith in a
firm commitment underwriting until the expiration of forty days after the
date of such acquisition.
"Code" means the Internal Revenue Code of 1986, as amended from time to
time, and any successor thereto.
"Committee" means the Committee referred to in Section 2 of the Plan. If at
any time no Committee shall be designated, then the functions of the
Committee specified in the Plan shall be exercised by the Board.
"Disability" means disability as determined under the disability plan of
the Company or Subsidiary of the Company applicable to the Participant.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Excluded Person" means (i) the Company; (ii) any of the Company's
Subsidiaries; (iii) any Holding Company; (iv) any employee benefit plan of
the Company, any of its Subsidiaries or a Holding Company; or (v) any
Person organized, appointed or established by the Company, any of its
Subsidiaries or a Holding Company for or pursuant to the terms of any plan
described in clause (iv).
"Fair Market Value" means, as of any given date, the opening or closing
price, as determined by the Committee, of the Stock on the New York Stock
Exchange or, if no sale of Stock occurs on the New York Stock Exchange on
such date, the opening or closing price, as determined by the Committee, of
the Stock on said exchange on the last preceding day on which such sale
occurred.
"Holding Company" means an entity that becomes a holding company for the
Company or its businesses as a part of any reorganization, merger,
consolidation or other transaction,
-3-
<PAGE>
provided that the outstanding shares of common stock of such entity and the
combined voting power of the then outstanding voting securities of such
entity entitled to vote generally in the election of directors is,
immediately after such reorganization, merger, consolidation or other
transaction, beneficially owned, directly or indirectly, by all or
substantially all of the individuals and entities who were the beneficial
owners, respectively, of the Voting Stock outstanding immediately prior to
such reorganization, merger, consolidation or other transaction in
substantially the same proportions as their ownership, immediately prior to
such reorganization, merger, consolidation or other transaction, of such
outstanding Voting Stock.
"Incentive Stock Option" means any Stock Option intended to be and
designated as an "Incentive Stock Option" within the meaning of Section 422
of the Code.
"Non-Qualified Stock Option" means any Stock Option that is not an
Incentive Stock Option.
"Other Stock-Based Award" means an award under Section 8 below of Stock or
that is valued in whole or in part by reference to, or is otherwise based
on, Stock.
"Option Price" means the price specified in Section 5 below.
"Participant" means the recipient of an award under the Plan.
"Person" means an individual, corporation, partnership, association, trust
or any other entity or organization.
"Plan" means the 1989 Stock Incentive Plan of Delta Air Lines, Inc., as
amended from time to time.
"Restricted Stock" means Stock granted under an award pursuant to Section 7
below which is subject to the restrictions specified therein.
"Retirement" means retirement from active employment with the Company or
any Subsidiary of the Company pursuant to the retirement or pension plan of
such entity applicable to the Participant.
"Stock" means the Common Stock, $3.00 par value, of the Company.
"Stock Appreciation Right" means a right granted under an award pursuant to
Section 6 below to receive an amount equal to the excess of the Fair Market
Value of the shares of Stock covered by such right over the Option Price
applicable to such shares, as specified in Section 6 below.
"Stock Option" or "Option" means any option to purchase shares of Stock
granted pursuant to Section 5 below.
-4-
<PAGE>
"Subsidiary" of any Person means any other Person of which securities or
other ownership interests having voting power to elect a majority of the
board of directors or other Persons performing similar functions are at the
time directly or indirectly owned by such Person.
"Voting Stock " means securities of the Company entitled to vote generally
in the election of members of the Board.
SECTION 2. Administration.
The Plan shall be administered by a Committee of the Board of Directors,
designated by the Board and to be comprised of not less than three members of
the Board. Each director, while serving as a member of the Committee, shall be
considered to be acting in his capacity as a director of the Company. Members of
the Committee shall be appointed from time to time for such terms as the Board
shall determine, and may be removed by the Board at any time with or without
cause. Subject to the provisions of the Plan, the Committee shall have sole and
complete authority to construe and interpret the Plan, to establish, amend and
rescind appropriate rules and regulations relating to the Plan, to determine the
persons to whom and the time or times at which to grant awards thereunder, to
administer the Plan, and to take all such steps and make all such determinations
in connection with the Plan and the awards granted thereunder as it may deem
necessary or advisable to carry out the provisions and intent of the Plan. All
determinations of the Committee shall be by a majority of its members, and its
determinations shall be final and conclusive for all purposes and upon all
persons, including but without limitation, the Company, the Committee, the
directors, officers and employees of the Company, the Participants and their
respective successors in interest.
Except as provided in the Plan, the Committee may make awards under Sections 5,
6, 7 and 8 of this Plan either alone or in such combinations as it deems
appropriate, and awards need not be the same with respect to each Participant.
When granting Stock Options under Section 5 of this Plan, the Committee shall
designate the Stock Option as either an Incentive Stock Option or a Non-
Qualified Stock Option. The Committee shall also designate whether the Stock
Option is granted with Stock Appreciation Rights.
SECTION 3. Stock Subject to Plan.
The total number of shares of Stock reserved and available for distribution
under the Plan shall be 6,000,000, which shall be increased to 9,800,000
effective January 1, 1998, subject to adjustment as provided in this Section.
Stock issued under the Plan may be either authorized and unissued shares or
treasury shares.
The aggregate number of shares of Restricted Stock and non-performance based
Other Stock-Based Awards that may be granted on or after January 1, 1998 under
Sections 7 and 8 of this Plan, respectively, to all Participants under the Plan
shall not exceed 1,200,000 over the term of the Plan, subject to adjustment as
provided in this Section.
-5-
<PAGE>
To the extent that any award under the Plan, or any portion thereof, is settled
in cash rather than in shares of Stock, the number of shares of Stock subject to
such award, less the number of shares of Stock issued, if any, in connection
with such settlement, shall again be available for distribution in connection
with future awards under the Plan. Subject to Section 6(d) below, if any shares
of Stock subject to a Stock Option cease to be subject to such Option for any
reason other than the exercise of such Option, or if any shares of Stock subject
to a Restricted Stock award or Other Stock-Based Award are forfeited or any such
award otherwise terminates, in whole or part, without a payment being made to
the Participant in the form of Stock, the shares of Stock previously subject to
such Option or award shall again be available for distribution in connection
with future awards under the Plan.
In the event of any merger, reorganization, consolidation, recapitalization,
Stock dividend, Stock split or other change in corporate structure affecting the
Stock, the Committee, in its sole discretion, shall make such modifications,
substitutions or adjustments as it deems necessary to reflect such change so as
to prevent the deletion or enlargement of rights, including but not limited to,
modifications, substitutions, or adjustments in the aggregate number of shares
reserved for issuance under the Plan, in the number and Option Price of shares
subject to outstanding Options or Stock Appreciation Rights granted under the
Plan, in the number of shares subject to other outstanding awards granted under
the Plan, and in any limitation on the aggregate number of awards which may be
granted under the Plan to any individual Participant or to all Participants,
provided that the number of shares subject to any award shall always be a whole
number.
SECTION 4. Eligibility.
Officers and other key employees of the Company and its Subsidiaries who are
responsible for or contribute to the management, growth and/or profitability of
the Company and/or its Subsidiaries, as determined by the Committee, are
eligible to be granted awards under the Plan.
SECTION 5. Stock Options.
Award Limitation
For awards granted on or before December 31, 1997, the number of shares of Stock
subject to Stock Options that may be awarded to an individual Participant under
the Plan shall not exceed ten percent of the maximum total number of shares of
Stock reserved for distribution under Section 3 of the Plan. For awards granted
on or after January 1, 1998, the maximum number of shares of Stock subject to
Stock Options that may be awarded to an individual Participant under the Plan
shall not exceed 350,000 per calendar year.
Grant
Subject to the provisions of the Plan, the Committee shall have sole and
complete authority to determine the persons to whom Stock Options shall be
granted, the number of shares to be covered by each Stock Option and the
conditions and limitations, if any, in addition to those set forth in this
Section 5, applicable to such Stock Options. The Committee shall have the
authority
-6-
<PAGE>
to grant both Incentive Stock Options and Non-Qualified Stock Options. In the
case of Incentive Stock Options, the terms and conditions of such grants shall
be subject to and comply with the requirements of Section 422 of the Code, as
from time to time amended, and any implementing regulations. Each such award
shall be confirmed by an agreement executed by the Committee and the
Participant, which agreement shall contain such provisions as the Committee
determines to be necessary or appropriate to carry out the intent of this Plan
with respect to such award. Unless otherwise determined by the Committee, each
such agreement shall provide that the Option (and any related Stock Appreciation
Right) is not transferable by the Participant otherwise than by will, by the
laws of descent and distribution, or by a written designation referred to in
Section 10(c) below, and is exercisable, during the Participant's lifetime, only
by such Participant.
Option Price
The Committee shall establish the Option Price at the time each Stock Option is
granted, which price shall not be less than 100% of the Fair Market Value of the
Stock on the date of grant. The Option Price shall be the price payable by the
Participant for a share of Stock upon the exercise of a Stock Option. The Option
Price shall be subject to adjustment in accordance with the provisions of
Section 3 hereof.
Exercise
The Committee shall determine when a Stock Option shall become exercisable, and
may provide that a Stock Option is exercisable in installments, provided that no
Stock Option shall be exercisable earlier than one (1) year or later than ten
(10) years after the date of grant, except that the one (1) year limitation
shall not apply: (a) if a Participant dies prior to one (1) year after the date
of grant, in which event the Option may be exercised as provided in Section 10
hereof; (b) if the Participant's employment is terminated under circumstances
designated by the Committee in its discretion; or (c) if there occurs a Change
in Control.
The Option Price of each share as to which an Option is exercised shall be paid
in full at or before the time of settlement of such exercise. Such payment shall
be made in cash, or, subject to the consent of the Committee and to such
limitations as the Committee may impose, by tender of shares of unrestricted
Stock valued at Fair Market Value as of the date of exercise, or by a
combination of cash and shares of unrestricted Stock.
Incentive Stock Options
Anything in the Plan to the contrary notwithstanding, no term of this Plan
relating to Incentive Stock Options shall be interpreted, amended or altered,
nor shall any discretion or authority granted under the Plan be so exercised, so
as to disqualify the Plan under Section 422 of the Code, or, without the consent
of the Participant(s) affected, to disqualify any Incentive Stock Option under
such Section 422.
To the extent permitted under Section 422 of the Code or the applicable
regulations thereunder or any applicable Internal Revenue Service pronouncement,
and subject to such terms and conditions
-7-
<PAGE>
as the Committee shall prescribe, any Incentive Stock Option that does not
continue to comply with the requirements of the Code shall be treated as a Non-
Qualified Stock Option.
SECTION 6. Stock Appreciation Rights.
Award Limitation
The maximum number of shares of Stock subject to Stock Appreciation Rights that
may be awarded to an individual Participant under the Plan shall not exceed the
limit specified in Section 5 of the Plan.
Grant
Subject to the provisions of the Plan, the Committee shall have sole and
complete authority to determine the persons who shall receive Stock Appreciation
Rights and the number of shares of Stock with respect to which each Stock
Appreciation Right is granted. Stock Appreciation Rights may be granted only in
conjunction with Stock Options granted under the Plan. Whenever Stock
Appreciation Rights are granted, they shall be provided for in the agreement
referred to in Section 5 above, or an amendment thereto.
A Stock Appreciation Right or applicable portion thereof granted in conjunction
with a given Stock Option shall terminate and no longer be exercisable upon the
termination or exercise of the related Stock Option, and a Stock Option or
applicable portion thereof granted in conjunction with a Stock Appreciation
Right shall terminate and no longer be exercisable upon the termination or
exercise of the related Stock Appreciation Right.
Terms and Conditions
Stock Appreciation Rights shall be exercisable in accordance with procedures
established by the Committee and shall be subject to such terms and conditions,
not inconsistent with the provisions of the Plan, as shall be determined from
time to time by the Committee, in addition to the following:
(a) Stock Appreciation Rights shall be exercisable only at such time or times
and to the extent that the Stock Options to which they relate shall be
exercisable in accordance with the provisions of Section 5 of the Plan.
(b) Upon the exercise of a Stock Appreciation Right, a Participant shall be
entitled to receive an amount in cash or shares of Stock or a combination
thereof, as determined by the Committee, equal in value to the excess of the
Fair Market Value of one share of Stock over the Option Price per share
specified in the related Stock Option multiplied by the number of shares in
respect of which the Stock Appreciation Right shall have been exercised. The
Fair Market Value used to determine the amount payable (and the number of shares
payable to the extent that the payment is in the form of Stock) shall be the
Fair Market Value on the last trading day preceding the date of exercise of the
Stock Appreciation Right or, if so specified by the Committee, the highest Fair
-8-
<PAGE>
Market Value during the applicable period referred to in the related award
agreement, in which the Stock Appreciation Right is exercised.
(c) Stock Appreciation Rights shall be transferable only when and to the extent
that the related Stock Option would be transferable under Section 5 of the Plan.
(d) Upon the exercise of a Stock Appreciation Right, the Stock Option or part
thereof to which such Stock Appreciation Right is related shall be deemed to
have been exercised for the purpose of the limitation set forth in Section 3 of
the Plan on the number of shares of Stock to be issued under the Plan, but only
to the extent of the number of shares actually issued, if any, upon the exercise
of the Stock Appreciation Right.
SECTION 7. Restricted Stock.
Award Limitation
The maximum number of shares of Restricted Stock that may be awarded under
Section 7 of the Plan to an individual Participant under the Plan is 200,000 per
calendar year.
Grant
Subject to the provisions of the Plan, the Committee shall have sole and
complete authority to determine the persons to whom, and the time or times at
which, grants of Restricted Stock will be made, the number of shares to be
awarded, the price (if any) to be paid by the recipient of Restricted Stock, the
time or times within which such awards may be subject to forfeiture, and all
other terms and conditions of the awards.
The Committee may condition the grant of Restricted Stock upon the attainment of
specified performance goals or such other factors as the Committee may
determine, in its sole discretion.
Each Restricted Stock award shall be confirmed by an agreement executed by the
Committee and the Participant, which agreement shall contain such provisions as
the Committee determines to be necessary or appropriate to carry out the intent
of this Plan with respect to such award.
Each Participant receiving a Restricted Stock award shall be issued a Stock
certificate in respect of such shares of Restricted Stock. Such certificate
shall be registered in the name of such Participant, and shall bear an
appropriate legend referring to the terms, conditions, and restrictions
applicable to such award.
The Committee shall require that Stock certificates evidencing such shares be
held by the Company until the restrictions thereon shall have lapsed, and that,
as a condition of any Restricted Stock award, the Participant shall have
delivered to the Company a stock power, endorsed in blank, relating to the Stock
covered by such award.
-9-
<PAGE>
Restrictions and Conditions
The shares of Restricted Stock awarded pursuant to this Section 7 shall be
subject to the following restrictions and conditions:
(a) During a period set by the Committee commencing with the date of such award
(the "Restriction Period"), the Participant shall not be permitted to sell,
transfer, pledge or assign shares of Restricted Stock awarded under the Plan.
Within these limits, the Committee, in its sole discretion, may provide for the
lapse of such restrictions in installments and may accelerate or waive such
restrictions in whole or in part, based on service, performance and/or such
other factors or criteria as the Committee may determine.
(b) Except as provided in this paragraph (b) and paragraph (a) above, the
Participant shall have, with respect to the shares of Restricted Stock, all of
the rights of a shareholder of the Company, including the right to vote the
shares, and the right to receive any cash dividends. The Committee, in its sole
discretion, as determined at the time of award, may provide that the payment of
cash dividends shall or may be deferred and, if the Committee so determines,
reinvested in additional shares of Stock or Restricted Stock to the extent
shares are available under Section 3, or otherwise reinvested. Pursuant to
Section 3 above, Stock dividends issued with respect to Restricted Stock shall
be treated as additional shares of Restricted Stock that are subject to the same
restrictions and other terms and conditions that apply to the shares with
respect to which such dividends are issued.
(c) Upon termination of a Participant's employment with the Company or any
Subsidiary of the Company for any reason during the Restriction Period, all
shares still subject to restriction will vest, or be forfeited, in accordance
with the terms and conditions established by the Committee in the award
agreement.
(d) If and when the Restriction Period expires without a prior forfeiture of the
Restricted Stock subject to such Restriction Period, certificates for an
appropriate number of unrestricted shares of Stock shall be delivered promptly
to the Participant, and the certificates for the shares of Restricted Stock
shall be canceled.
SECTION 8. Other Stock-Based Awards.
Award Limitation
The maximum number of shares of Stock subject to Other Stock-Based Awards that
may be awarded under Section 8 of the Plan to an individual Participant under
the Plan is 200,000 per calendar year.
Grant
Other Stock-Based Awards may be granted either alone or in addition to or in
conjunction with other awards under this Plan. Awards under this section may
include, but are not limited to, the
-10-
<PAGE>
grant of Stock upon the continued employment of a Participant for a specified
period of time, the payment of cash or Stock based upon the performance of the
Stock or other criteria, or the grant of securities convertible into Stock.
Subject to the provisions of the Plan, the Committee shall have sole and
complete authority to determine the persons to whom and the time or times at
which such awards shall be made, the number of shares of Stock or other
securities, if any, to be granted pursuant to such awards, and all other
conditions of the awards. Any such award shall be subject to an agreement
between the Company and the Participant.
Each Other Stock-Based Award shall be confirmed by an agreement executed by the
Committee and the Participant, which agreement shall contain such provisions as
the Committee determines to be necessary or appropriate to carry out the intent
of this Plan with respect to such award.
Performance-Based Awards
The Committee may, in its discretion, grant Other Stock-Based Awards to a
Participant with the intent that such awards qualify as "performance-based
compensation" under Section 162(m) of the Code. These awards may consist of
Performance Units or Performance Shares.
A Performance Unit is a right, denominated in cash or cash units, to receive, at
a specified future date, payment in cash or Stock, as determined by the
Committee, of an amount which is to be determined based on the extent to which
specified performance goals are satisfied. At the time of granting the awards,
the Committee, in the award agreement or by other Plan rules, shall determine
the base value of the unit, the performance factors applicable to the
determination of the ultimate payment value of the Performance Unit as set forth
below and the period over which performance will be measured.
A Performance Share is a right, granted in the form of Stock or stock units
equivalent to Stock, to receive, at a specified future date, payment in cash or
Stock, as determined by the Committee, of an amount which is to be determined
based on the extent to which specified performance goals are satisfied. Each
Performance Share shall have an initial value equal to the Fair Market Value of
a share of Stock on the date of grant. At the time of granting the awards, the
Committee, in the award agreement or by other Plan rules, shall determine the
performance factors applicable to the number of Performance Shares to be earned
as set forth below and the period over which performance will be measured.
The performance factors selected by the Committee in respect of Performance
Units and Performance Shares shall be based on any one or more of the following:
total shareholder return; return on equity, assets, capital or investment;
operating, pre-tax or after-tax profit levels expressed in either absolute
dollars, earnings per share, or increases of the same; revenues or revenue
growth; Stock price; cash flow; economic or cash value added; results of
customer satisfaction surveys; and other measures of quality, safety,
productivity or process improvement. Such performance goals may be determined
solely by reference to the performance of the Company, a Subsidiary of the
Company, or a division or unit of any of the foregoing, or based on
-11-
<PAGE>
comparisons of any of the performance measures relative to other companies.
These factors shall have a minimum performance standard below which no amount
will be paid, a target performance standard and a maximum performance standard
above which no additional payments will be made. The applicable performance
period shall not exceed 10 years.
Prior to payment of any performance-based award intended to qualify under
Section 162(m) of the Code, the Committee shall certify in writing that the
performance goals and any other material terms of the award were in fact
satisfied, all in a manner consistent with the applicable regulations under
Section 162(m) of the Code.
Performance-based awards may be paid in a lump sum or in installments following
the close of the performance period or, in accordance with procedures
established by the Committee, on a deferred basis.
Terms and Conditions
In addition to the terms and conditions specified in the award agreement, Other
Stock-Based Awards made pursuant to this Section 8 shall be subject to the
following:
(a) Unless otherwise determined by the Committee, any shares of Stock subject to
awards made under this Section 8 may not be sold, assigned, transferred, pledged
or otherwise encumbered prior to the date on which the shares are issued, or, if
later, the date on which any applicable restriction, performance or deferral
period lapses.
(b) If specified by the Committee in the award agreement, the recipient of an
award under this Section 8 shall be entitled to receive, currently or on a
deferred basis, interest or dividends or dividend equivalents with respect to
the Stock or other securities covered by the award, and the Committee may
provide that such amounts (if any) shall be deemed to have been reinvested in
additional Stock or otherwise reinvested.
(c) The award agreement with respect to any Other Stock-Based Award shall
contain provisions dealing with the disposition of such award in the event of a
termination of the Participant's employment prior to the exercise, realization
or payment of such award, whether such termination occurs because of Retirement,
Disability, death or other reason, with such provisions to take account of the
specific nature and purpose of the award.
SECTION 9. Change in Control.
Upon the occurrence of a Change in Control:
(a) All outstanding Stock Options and Stock Appreciation Rights shall become
immediately vested, exercisable and nonforfeitable and shall remain vested,
exercisable and nonforfeitable during their remaining terms.
-12-
<PAGE>
(b) Any Restriction Period and other restrictions imposed on outstanding non-
performance based Restricted Stock and Other Stock-Based Awards shall lapse.
(c) Each outstanding award of performance-based Restricted Stock and Other
Stock-Based Awards shall be paid in an amount equal to the greater of (i) the
actual award payable to the Participant for the applicable performance period,
calculated as if the performance period had ended on the date of the Change in
Control, and (ii) the target award payable to Participant for that performance
period, in each case prorated to reflect the portion of the performance period
elapsed through the date of the Change in Control. The applicable amount shall
be paid in the form of cash or Stock, in accordance with the terms of the
applicable award agreement, promptly after the Change in Control.
SECTION 10. Termination of Employment, Retirement, Disability, Death and
Voluntary Demotion.
Unless otherwise determined by the Committee, the following shall apply to
awards under Sections 5 and 6 of the Plan:
(a) If a Participant's employment shall be terminated by the Company or a
Subsidiary of the Company, or if a Participant resigns from employment with the
Company or a Subsidiary of the Company, the Stock Options or Stock Appreciation
Rights held by such Participant shall be forfeited unless the Committee
authorizes the exercise of such Stock Options or Stock Appreciation Rights,
provided that any such exercise shall be permissible only for a period of up to
four (4) months following such termination or resignation and only if such
exercise is otherwise permissible under the Plan and the applicable award
agreement.
(b) With respect to awards made prior to October 28, 1993, a Participant whose
employment is terminated because of his Retirement or Disability shall be
treated as though he remains in active employment, unless the applicable award
agreement is amended to shorten the exercise period following Retirement or
Disability. With respect to awards made on or after October 28, 1993, a
Participant whose employment is terminated because of his Retirement or
Disability may exercise his outstanding Stock Options or Stock Appreciation
Rights only during the shorter of the exercise period remaining under the
applicable award agreement or the three years after such Retirement or
Disability. In the case of an exercise under either of the two preceding
sentences, such exercise must otherwise comply with the Plan and the applicable
award agreement. Notwithstanding the preceding sentences, however, if a
Participant's employment is terminated because of Retirement prior to his normal
retirement date (as determined under the retirement or pension plan of the
Company or Subsidiary of the Company applicable to the Participant) and,
within two years after such early Retirement and without the Committee's
approval, such Participant directly or indirectly provides management or
executive services (whether as a consultant, advisor, officer or director) to
any Person who is in direct and substantial competition with the air
transportation business of the Company or its Subsidiaries, then such
Participant shall immediately forfeit any Stock Options and Stock Appreciation
Rights held by him. Because of the broad and extensive scope of the Company's
air transportation business, the restrictions contained in this provision are
intended to extend to management or executive services which are
-13-
<PAGE>
directly related to the provision of air transportation services into, within,
or from the United States, as no smaller geographical restriction will
adequately protect the legitimate business interests of the Company.
(c) With respect to awards made prior to October 28, 1993, in the event of the
death of a Participant while employed by the Company or a Subsidiary of the
Company or while covered by Section 10(b) above, such Participant's Stock
Options or Stock Appreciation Rights may only be exercised within one year after
the Participant's death, unless the applicable award agreement is amended to
provide a maximum exercise period of up to three years as described in the next
sentence. With respect to awards made on or after October 28, 1993, in the
event of the death of a Participant while employed by the Company or a
Subsidiary of the Company, such Participant's Stock Options or Stock
Appreciation Rights may be exercised only within the shorter of the exercise
period remaining under the applicable award agreement or the three years after
the Participant's death. In the case of an exercise under either of the two
preceding sentences, such exercise may be made by the person or persons named in
a written designation by the Participant delivered to and approved by the
Committee, or if there is no such approved designation, by the executor or
administrator of the Participant's estate or such other personal representative,
legatee or devisee, as may be designated in the Participant's last will and
testament; provided, however, that such exercise must otherwise comply with the
Plan and the applicable award agreement.
(d) In the event that prior to or after the time that a Stock Option or Stock
Appreciation Right first becomes exercisable, a Participant either voluntarily
suggests and later accepts a demotion, or is involuntarily demoted, to a job
involving lesser responsibilities than those of the job held by the Participant
at the time of an award hereunder, the Committee may in its sole discretion, not
later than six months from the date of the demotion, revoke or modify such award
in any manner as it deems appropriate under the circumstances. The Committee
shall determine in its sole discretion what constitutes a demotion to a job
involving lesser responsibilities for purposes of this Section 10(d).
(e) Notwithstanding anything in Section 10(a)-(d) above to the contrary, if a
Participant resigns from employment with the Company and coincident with such
resignation becomes an employee of WORLDSPAN L.P. ("WORLDSPAN") or of
TransQuest, such Participant shall be treated as though he remains in active
employment with the Company with respect to Stock Options and Stock Appreciation
Rights outstanding at the time of such resignation; provided, however, that,
after becoming an employee of WORLDSPAN or TransQuest coincident with his
resignation from the Company:
(i) If a Participant's employment is terminated by WORLDSPAN or TransQuest,
or if a Participant resigns from employment with WORLDSPAN or TransQuest
(other than if such Participant becomes an employee of the Company or a
Subsidiary of the Company coincident with his resignation from WORLDSPAN or
TransQuest), the Stock Options or Stock Appreciation Rights held by such
Participant shall be forfeited unless the Committee authorizes the exercise
of such Stock Options or Stock Appreciation Rights, provided that any such
exercise shall be permissible only for a period of up to four (4) months
following such termination or resignation and only if such exercise is
otherwise permissible under the
-14-
<PAGE>
Plan and the applicable award agreement; and provided further that if a
Participant resigns from WORLDSPAN or TransQuest and coincident with such
resignation becomes an employee of the Company or a Subsidiary of the
Company, such Participant shall, subject to Sections 10(a)-(d) above, be
treated as in active employment with the Company.
(ii) If a Participant's employment with WORLDSPAN or TransQuest is
terminated because of his retirement or disability under WORLDSPAN's or
TransQuest's retirement or disability plan applicable to such Participant,
such Participant's Stock Options or Stock Appreciation Rights may only be
exercised during the shorter of the exercise period remaining under the
applicable award agreement or the three years after such retirement or
disability; provided, however, that such exercise must otherwise comply
with the Plan and the applicable award agreement. Notwithstanding the
preceding sentence, however, if a Participant's employment is terminated
because of retirement prior to his normal retirement date (as determined
under WORLDSPAN's or TransQuest's retirement or pension plan applicable to
the Participant) and, within two years after such early retirement and
without the Committee's approval, such Participant directly or indirectly
provides management or executive services (whether as a consultant,
advisor, officer or director) to any Person who is in direct and
substantial competition with the air transportation business of the Company
or its Subsidiaries, then such Participant shall immediately forfeit any
Stock Options and Stock Appreciation Rights held by him. Because of the
broad and extensive scope of the Company's air transportation business, the
restrictions contained in this provision are intended to extend to
management or executive services which are directly related to the
provision of air transportation services into, within, or from the United
States, as no smaller geographical restriction will adequately protect the
legitimate business interests of the Company.
(iii) If a Participant dies while employed by WORLDSPAN or TransQuest or
while covered by Section 10(e)(ii) above, such Participant's Stock Options
or Stock Appreciation Rights may only be exercised within the shorter of
the exercise period remaining under the applicable award agreement or the
three years after the Participant's death by the person or persons named in
a written designation by the Participant delivered to and approved by the
Committee, or if there is no such approved designation, by the executor or
administrator of the Participant's estate or such other personal
representative, legatee or devisee, as may be designated in the
Participant's last will and testament; provided, however, that such
exercise must otherwise comply with the Plan and the applicable award
agreement.
(iv) If prior to the time that a Stock Option or Stock Appreciation Right
is exercisable, a Participant voluntarily suggests and later accepts a
demotion to a job involving lesser responsibilities than those of the job
held by the Participant at the time of first becoming an employee of
WORLDSPAN or TransQuest, the Committee in its sole discretion may revoke or
modify such award as it deems appropriate under the circumstances.
-15-
<PAGE>
SECTION 11. Amendments and Termination.
The Board may amend, alter, or discontinue the Plan, but no amendment,
alteration, or discontinuation shall be made which would impair the rights of a
Participant under a Stock Option, Stock Appreciation Right, Restricted Stock
award, or Other Stock-Based Award theretofore granted, without the Participant's
consent, or which, without the approval of the Company's stockholders, would
cause the Plan not to continue to comply with Rule 16b-3 under the Exchange Act,
or any successor to such Rule.
The Committee may amend the terms of any Stock Option or other award theretofore
granted, including but not limited to extending the time during which awards
granted prior to October 28, 1993 may be exercised to the full period of time
permitted by the Plan; provided, however, that, subject to Section 3 above, no
such amendment shall impair the rights of any Participant without the
Participant's consent, except as provided in Section 10(d) above.
Subject to the above provisions, the Board shall have broad authority to amend
the Plan to take into account changes in applicable securities and tax laws and
accounting rules, as well as other developments.
SECTION 12. General Provisions.
(a) The Committee may require each person purchasing shares pursuant to a Stock
Option, Stock Appreciation Right or other award under the Plan to represent to
and agree with the Company in writing that such person is acquiring the shares
without a view to distribution thereof. The certificates for such shares may
include any legend which the Committee deems appropriate to reflect any
restrictions on transfer.
All certificates for shares of Stock or other securities delivered under the
Plan shall be subject to such stock-transfer orders and other restrictions as
the Committee may deem advisable under the rules, regulations, and other
requirements of the Securities and Exchange Commission, any stock exchange upon
which the Stock is then listed, and any applicable Federal or state securities
law, and the Committee may cause a legend or legends to be put on any such
certificates to make appropriate references to such restrictions. Except as
otherwise provided in the Plan, Participants shall have no rights as
stockholders of Stock covered by an award prior to the issuance of a Stock
certificate to such Participant.
(b) Nothing contained in this Plan shall prevent the Board from adopting other
or additional compensation arrangements, subject to stockholder approval if such
approval is required; and such arrangements may be either generally applicable
or applicable only in specific cases.
(c) The adoption of the Plan shall not confer upon any employee of the Company
or any Subsidiary of the Company any right to continued employment with the
Company or a Subsidiary of the Company, as the case may be, nor shall it
interfere in any way with the right of the
-16-
<PAGE>
Company or a Subsidiary of the Company to terminate the employment of any of its
employees at any time.
(d) No later than the date as of which an amount first becomes includible in the
gross income of the Participant for Federal income tax purposes with respect to
any award under the Plan, the Participant shall pay to the Company, or make
arrangements satisfactory to the Company regarding the payment of, any Federal,
state, or local taxes of any kind required by law to be withheld with respect to
such amount. Subject to the consent of the Committee and to such limitations as
the Committee may impose, withholding obligations may be settled with Stock,
including Stock that is part of the award that gives rise to the withholding
requirement. The obligations of the Company under the Plan shall be conditioned
on such payment or arrangements and the Company and its Subsidiaries shall, to
the extent permitted by law, have the right to deduct any such taxes from any
payment of any kind otherwise due to the Participant.
(e) The Plan and all awards made and actions taken thereunder shall be governed
by and construed in accordance with the laws of the State of Georgia.
(f) Agreements with respect to awards pursuant to the Plan may contain, in
addition to terms and conditions prescribed in the Plan, such other terms and
conditions as the Committee may deem appropriate provided such terms and
conditions are not inconsistent with the provisions of the Plan.
SECTION 13. Effective Date of Plan.
The Plan as originally adopted was approved by the stockholders of the Company
and became effective as of January 1, 1989.
SECTION 14. Term of Plan.
No Stock Option, Stock Appreciation Right, Restricted Stock award or Other
Stock-Based Award shall be granted pursuant to the Plan on or after January 1,
2004, but awards granted prior to January 1, 2004 may extend beyond that date.
NOTE: The foregoing is the original 1989 Stock Incentive Plan as adopted by
Delta Air Lines' Board of Directors on July 28, 1988, for effectiveness on
January 1, 1989, and as amended April 26, 1990, January 24, 1991, July 22, 1993,
October 28, 1993, October 27, 1994, January 26, 1995, July 24, 1997 and October
23, 1997.
/s/ Robert S. Harkey
--------------------------------------
Robert S. Harkey
Senior Vice President - General Counsel
& Secretary
-17-
<PAGE>
EXHIBIT 5
---------
April 6, 1998
Delta Air Lines, Inc.
Hartsfield Atlanta International Airport
Atlanta, Georgia 30320
Re: Delta Air Lines, Inc. --
Form S-8 Registration Statement
-------------------------------
Dear Sirs:
I am Senior Vice President - General Counsel of Delta Air Lines, Inc., a
Delaware corporation (the "Company"), and as such am familiar with the actions
taken by the Company in connection with the preparation and filing with the
Securities and Exchange Commission pursuant to the Securities Act of 1933, as
amended, of a Registration Statement on Form S-8 (the "Registration Statement")
relating to (i) an additional 3,800,000 shares (the "Shares") of the Company's
Common Stock, par value $3.00 per share (the "Common Stock"), to be offered
pursuant to the 1989 Stock Incentive Plan of Delta Air Lines, Inc., as amended
(the "Plan"), and (ii) rights (the "Rights") to be issued with and attached to
the Shares pursuant to the Rights Agreement dated as of October 24, 1996 (the
"Rights Agreement"), between the Company and First Chicago Trust Company of New
York, as Rights Agent.
In this connection, I or counsel under my supervision have examined originals
or copies, certified or otherwise identified to our satisfaction, of (i) the
Plan, (ii) the Company's Certificate of Incorporation and By-Laws, (iii) the
Rights Agreement, (iv) resolutions adopted by the Company's Board of Directors,
and (v) such other documents as I have deemed necessary or appropriate as a
basis for the opinion set forth herein.
Based upon the foregoing, I am of the opinion that the Shares and, assuming
that the Rights Agreement has been duly authorized, executed and delivered by
the Rights Agent (as such term is defined in the Rights Agreement), the Rights
attached thereto, when issued under the Plan are duly authorized and, when
certificates for the Shares are duly executed and delivered pursuant to the
Plan, and in each case upon payment to the Company of any price for such Shares
provided for in the Plan (which price is assumed herein to be in no event less
than the par value of the Shares being issued upon such payment), the Shares and
the Rights attached thereto will be validly issued, fully paid and
nonassessable.
<PAGE>
Delta Air Lines, Inc.
April 6, 1998
Page 2
In connection with the foregoing opinion, I note that the question whether
the Board of Directors of the Company might be required to redeem the Rights at
some future time will depend upon the facts and circumstances existing at that
time and, accordingly, is beyond the scope of such opinion.
I am qualified to practice law in the State of Georgia and I do not purport
to be an expert on, or to express any opinion herein concerning, any laws other
than the laws of the State of Georgia, the corporate laws of the State of
Delaware and the federal laws of the United States.
I hereby consent to the filing of this opinion as an Exhibit to the
Registration Statement. In giving such consent, I do not admit I am in the
category of persons whose consent is required under Section 7 of the Securities
Act of 1933, as amended.
Very truly yours,
/s/ Robert S. Harkey
---------------------------------------
Senior Vice President - General Counsel
& Secretary
<PAGE>
EXHIBIT 15
----------
ARTHUR ANDERSEN LLP
To Delta Air Lines, Inc.:
We are aware that Delta Air Lines, Inc. has incorporated by reference in this
Registration Statement on Form S-8 (relating to the 1989 Stock Incentive Plan of
Delta Air Lines, Inc., as amended) its Form 10-Q for the quarters ended
September 30, 1997 and December 31, 1997, which include our reports dated
October 31, 1997 and January 30, 1998, respectively, covering the unaudited
interim financial information contained therein. Pursuant to Regulation C of
the Securities Act of 1933 (the "Act"), those reports are not considered a part
of the Registration Statement prepared or certified by our firm or reports
prepared or certified by our firm within the meaning of Sections 7 and 11 of the
Act.
/s/ ARTHUR ANDERSEN LLP
Atlanta, Georgia
April 3, 1998
<PAGE>
EXHIBIT 23(b)
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
- -----------------------------------------
As independent public accountants, we hereby consent to the incorporation by
reference in this Registration Statement on Form S-8 (relating to the 1989 Stock
Incentive Plan of Delta Air Lines, Inc., as amended) of our reports dated August
15, 1997 included or incorporated by reference in Delta Air Lines, Inc.'s Annual
Report on Form 10-K for the fiscal year ended June 30, 1997 and to all
references to our firm included in this Registration Statement.
/s/ ARTHUR ANDERSEN LLP
Atlanta, Georgia
April 3, 1998
<PAGE>
EXHIBIT 24
----------
POWER OF ATTORNEY
I hereby constitute and appoint Leo F. Mullin and Edward H. West, and each
of them separately, as my true and lawful attorneys-in-fact and agents, with
full power of substitution, for me and in my name, in any and all capacities, to
sign on my behalf (1) one or more registration statements to be filed by Delta
Air Lines, Inc. ("Delta") on Form S-8 or other appropriate form, or any
amendment or supplement thereto, for the registration under the Securities Act
of 1933, as amended, of an additional 3,800,000 shares of Common Stock, par
value $3.00 per share, of Delta in connection with the 1989 Stock Incentive Plan
of Delta, (2) any application for registration or qualification (or exemption
therefrom) of such securities under the Blue Sky or other federal or state
securities laws and regulations, and (3) any other document or instrument deemed
necessary or appropriate by any of them in connection with such application for
registration or qualification (or exemption therefrom); and to file any such
registration statement, amendment, supplement, application, or other document or
instrument with the Securities and Exchange Commission or other appropriate
agency pursuant to applicable federal and state securities laws and regulations.
IN WITNESS WHEREOF, I have hereunto set my hand this 24th day of March,
1998.
/s/ Edwin L. Artzt
-----------------------------
Edwin L. Artzt
Director
Delta Air Lines, Inc.
<PAGE>
POWER OF ATTORNEY
I hereby constitute and appoint Leo F. Mullin and Edward H. West, and each
of them separately, as my true and lawful attorneys-in-fact and agents, with
full power of substitution, for me and in my name, in any and all capacities, to
sign on my behalf (1) one or more registration statements to be filed by Delta
Air Lines, Inc. ("Delta") on Form S-8 or other appropriate form, or any
amendment or supplement thereto, for the registration under the Securities Act
of 1933, as amended, of an additional 3,800,000 shares of Common Stock, par
value $3.00 per share, of Delta in connection with the 1989 Stock Incentive Plan
of Delta, (2) any application for registration or qualification (or exemption
therefrom) of such securities under the Blue Sky or other federal or state
securities laws and regulations, and (3) any other document or instrument deemed
necessary or appropriate by any of them in connection with such application for
registration or qualification (or exemption therefrom); and to file any such
registration statement, amendment, supplement, application, or other document or
instrument with the Securities and Exchange Commission or other appropriate
agency pursuant to applicable federal and state securities laws and regulations.
IN WITNESS WHEREOF, I have hereunto set my hand this 24th day of March,
1998.
/s/ Henry A. Biedenharn, III
--------------------------------
Henry A. Biedenharn, III
Director
Delta Air Lines, Inc.
<PAGE>
POWER OF ATTORNEY
I hereby constitute and appoint Leo F. Mullin and Edward H. West, and each
of them separately, as my true and lawful attorneys-in-fact and agents, with
full power of substitution, for me and in my name, in any and all capacities, to
sign on my behalf (1) one or more registration statements to be filed by Delta
Air Lines, Inc. ("Delta") on Form S-8 or other appropriate form, or any
amendment or supplement thereto, for the registration under the Securities Act
of 1933, as amended, of an additional 3,800,000 shares of Common Stock, par
value $3.00 per share, of Delta in connection with the 1989 Stock Incentive Plan
of Delta, (2) any application for registration or qualification (or exemption
therefrom) of such securities under the Blue Sky or other federal or state
securities laws and regulations, and (3) any other document or instrument deemed
necessary or appropriate by any of them in connection with such application for
registration or qualification (or exemption therefrom); and to file any such
registration statement, amendment, supplement, application, or other document or
instrument with the Securities and Exchange Commission or other appropriate
agency pursuant to applicable federal and state securities laws and regulations.
IN WITNESS WHEREOF, I have hereunto set my hand this 20th day of March,
1998.
/s/ James L. Broadhead
--------------------------------
James L. Broadhead
Director
Delta Air Lines, Inc.
<PAGE>
POWER OF ATTORNEY
I hereby constitute and appoint Leo F. Mullin and Edward H. West, and each
of them separately, as my true and lawful attorneys-in-fact and agents, with
full power of substitution, for me and in my name, in any and all capacities, to
sign on my behalf (1) one or more registration statements to be filed by Delta
Air Lines, Inc. ("Delta") on Form S-8 or other appropriate form, or any
amendment or supplement thereto, for the registration under the Securities Act
of 1933, as amended, of an additional 3,800,000 shares of Common Stock, par
value $3.00 per share, of Delta in connection with the 1989 Stock Incentive Plan
of Delta, (2) any application for registration or qualification (or exemption
therefrom) of such securities under the Blue Sky or other federal or state
securities laws and regulations, and (3) any other document or instrument deemed
necessary or appropriate by any of them in connection with such application for
registration or qualification (or exemption therefrom); and to file any such
registration statement, amendment, supplement, application, or other document or
instrument with the Securities and Exchange Commission or other appropriate
agency pursuant to applicable federal and state securities laws and regulations.
IN WITNESS WHEREOF, I have hereunto set my hand this 24th day of March,
1998.
/s/ Edward H. Budd
-----------------------------
Edward H. Budd
Director
Delta Air Lines, Inc.
<PAGE>
POWER OF ATTORNEY
I hereby constitute and appoint Leo F. Mullin and Edward H. West, and each
of them separately, as my true and lawful attorneys-in-fact and agents, with
full power of substitution, for me and in my name, in any and all capacities, to
sign on my behalf (1) one or more registration statements to be filed by Delta
Air Lines, Inc. ("Delta") on Form S-8 or other appropriate form, or any
amendment or supplement thereto, for the registration under the Securities Act
of 1933, as amended, of an additional 3,800,000 shares of Common Stock, par
value $3.00 per share, of Delta in connection with the 1989 Stock Incentive Plan
of Delta, (2) any application for registration or qualification (or exemption
therefrom) of such securities under the Blue Sky or other federal or state
securities laws and regulations, and (3) any other document or instrument deemed
necessary or appropriate by any of them in connection with such application for
registration or qualification (or exemption therefrom); and to file any such
registration statement, amendment, supplement, application, or other document or
instrument with the Securities and Exchange Commission or other appropriate
agency pursuant to applicable federal and state securities laws and regulations.
IN WITNESS WHEREOF, I have hereunto set my hand this 24th day of March,
1998.
/s/ R. Eugene Cartledge
--------------------------------
R. Eugene Cartledge
Director
Delta Air Lines, Inc.
<PAGE>
POWER OF ATTORNEY
I hereby constitute and appoint Leo F. Mullin and Edward H. West, and each
of them separately, as my true and lawful attorneys-in-fact and agents, with
full power of substitution, for me and in my name, in any and all capacities, to
sign on my behalf (1) one or more registration statements to be filed by Delta
Air Lines, Inc. ("Delta") on Form S-8 or other appropriate form, or any
amendment or supplement thereto, for the registration under the Securities Act
of 1933, as amended, of an additional 3,800,000 shares of Common Stock, par
value $3.00 per share, of Delta in connection with the 1989 Stock Incentive Plan
of Delta, (2) any application for registration or qualification (or exemption
therefrom) of such securities under the Blue Sky or other federal or state
securities laws and regulations, and (3) any other document or instrument deemed
necessary or appropriate by any of them in connection with such application for
registration or qualification (or exemption therefrom); and to file any such
registration statement, amendment, supplement, application, or other document or
instrument with the Securities and Exchange Commission or other appropriate
agency pursuant to applicable federal and state securities laws and regulations.
IN WITNESS WHEREOF, I have hereunto set my hand this 24th day of March,
1998.
/s/ Mary Johnston Evans
--------------------------------
Mary Johnston Evans
Director
Delta Air Lines, Inc.
<PAGE>
POWER OF ATTORNEY
I hereby constitute and appoint Leo F. Mullin and Edward H. West, and each
of them separately, as my true and lawful attorneys-in-fact and agents, with
full power of substitution, for me and in my name, in any and all capacities, to
sign on my behalf (1) one or more registration statements to be filed by Delta
Air Lines, Inc. ("Delta") on Form S-8 or other appropriate form, or any
amendment or supplement thereto, for the registration under the Securities Act
of 1933, as amended, of an additional 3,800,000 shares of Common Stock, par
value $3.00 per share, of Delta in connection with the 1989 Stock Incentive Plan
of Delta, (2) any application for registration or qualification (or exemption
therefrom) of such securities under the Blue Sky or other federal or state
securities laws and regulations, and (3) any other document or instrument deemed
necessary or appropriate by any of them in connection with such application for
registration or qualification (or exemption therefrom); and to file any such
registration statement, amendment, supplement, application, or other document or
instrument with the Securities and Exchange Commission or other appropriate
agency pursuant to applicable federal and state securities laws and regulations.
IN WITNESS WHEREOF, I have hereunto set my hand this 24th day of March,
1998.
/s/ Gerald Grinstein
--------------------------------
Gerald Grinstein
Director
Delta Air Lines, Inc.
<PAGE>
POWER OF ATTORNEY
I hereby constitute and appoint Leo F. Mullin and Edward H. West, and each
of them separately, as my true and lawful attorneys-in-fact and agents, with
full power of substitution, for me and in my name, in any and all capacities, to
sign on my behalf (1) one or more registration statements to be filed by Delta
Air Lines, Inc. ("Delta") on Form S-8 or other appropriate form, or any
amendment or supplement thereto, for the registration under the Securities Act
of 1933, as amended, of an additional 3,800,000 shares of Common Stock, par
value $3.00 per share, of Delta in connection with the 1989 Stock Incentive Plan
of Delta, (2) any application for registration or qualification (or exemption
therefrom) of such securities under the Blue Sky or other federal or state
securities laws and regulations, and (3) any other document or instrument deemed
necessary or appropriate by any of them in connection with such application for
registration or qualification (or exemption therefrom); and to file any such
registration statement, amendment, supplement, application, or other document or
instrument with the Securities and Exchange Commission or other appropriate
agency pursuant to applicable federal and state securities laws and regulations.
IN WITNESS WHEREOF, I have hereunto set my hand this 24th day of March,
1998.
/s/ Jesse Hill, Jr.
--------------------------------
Jesse Hill, Jr.
Director
Delta Air Lines, Inc.
<PAGE>
POWER OF ATTORNEY
I hereby constitute and appoint Leo F. Mullin and Edward H. West, and each
of them separately, as my true and lawful attorneys-in-fact and agents, with
full power of substitution, for me and in my name, in any and all capacities, to
sign on my behalf (1) one or more registration statements to be filed by Delta
Air Lines, Inc. ("Delta") on Form S-8 or other appropriate form, or any
amendment or supplement thereto, for the registration under the Securities Act
of 1933, as amended, of an additional 3,800,000 shares of Common Stock, par
value $3.00 per share, of Delta in connection with the 1989 Stock Incentive Plan
of Delta, (2) any application for registration or qualification (or exemption
therefrom) of such securities under the Blue Sky or other federal or state
securities laws and regulations, and (3) any other document or instrument deemed
necessary or appropriate by any of them in connection with such application for
registration or qualification (or exemption therefrom); and to file any such
registration statement, amendment, supplement, application, or other document or
instrument with the Securities and Exchange Commission or other appropriate
agency pursuant to applicable federal and state securities laws and regulations.
IN WITNESS WHEREOF, I have hereunto set my hand this 24th day of March,
1998.
/s/ Andrew J. Young
--------------------------------
Andrew J. Young
Director
Delta Air Lines, Inc.
