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EXHIBIT 10.6
NON-QUALIFIED STOCK OPTION AWARD AGREEMENT
UNDER THE 1989 STOCK INCENTIVE PLAN
July 27, 2000
[Name]
The 1989 Stock Incentive Plan, as amended (the "Plan"), is a
stock-based incentive compensation plan for officers and key employees of Delta
Air Lines, Inc. (the "Company") and its Subsidiaries. The Plan is administered
by the Personnel & Compensation Committee of the Company's Board of Directors
(the "Committee"). The Committee has selected you to receive an award of a
Non-Qualified Stock Option under Section 5 of the Plan, effective as of July 27,
2000, and has requested me, on behalf of the Company, to provide this Agreement
to you.
In consideration of the mutual covenants herein contained and for other
good and valuable consideration, the Company and you, as an employee of the
Company or one or more of its Subsidiaries, hereby agree as follows:
1. Grant of Award; Acknowledgments; Capitalized Terms. The Company hereby
grants to you a Non-Qualified Stock Option ("Stock Option") covering XX,XXX
shares (the "Option Shares") of Stock, as defined in the Plan, a copy of which
has been provided to you. This award is in all respects made subject to the
terms and conditions of the Plan and, in the event of any conflict between the
Plan and this Agreement, the Plan shall control. You acknowledge that you (a)
have had a full and adequate opportunity to read this Agreement and the Plan;
(b) agree to all of the terms and conditions thereof for yourself, any
designated beneficiary and your heirs, executors, administrators or personal
representatives; and (c) have received, and had a full and adequate opportunity
to read, the Prospectus relating to the Plan. Capitalized terms which are used
but not defined in this Agreement shall have the meanings set forth in the Plan.
2. Option Price. The Option Price of the Stock Option covered by this
award shall be $52.7500, the closing price of the Stock on the New York Stock
Exchange on July 27, 2000, the date of this award.
3. Exercise Period - General Rule. Subject to the terms and conditions of
the Plan and this Agreement, the Stock Option (a) shall become exercisable with
respect to 25% of the Option Shares on each of July 27, 2001, 2002, 2003 and
2004; and (b) shall be exercisable through and including July 26, 2010.
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This document constitutes part of a prospectus covering securities that have
been registered under the Securities Act of 1933.
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4. Special Rules Regarding Stock Option Exercise Period. The Stock Option
exercise period set forth in Paragraph 3 of this Agreement is subject to the
following terms and conditions (which shall apply in lieu of the provisions of
Section 10 of the Plan):
a. Termination of Employment Because of Retirement or Disability.
If your employment with the Company terminates due to Retirement or Disability,
the Stock Option (whether or not then exercisable under Paragraph 3 of this
Agreement) may be exercised, in whole or in part, to the extent not previously
exercised, forfeited, revoked or modified, only during the period (i) beginning
on the later of (A) July 27, 2001 or (B) the date your employment with the
Company terminates due to Retirement or Disability; and (ii) ending on and
including the earlier of (A) July 26, 2010 or (B) the third anniversary of the
date your employment with the Company terminates due to Retirement or
Disability.
b. Termination of Employment Because of Death. If you die while
employed by the Company, the Stock Option (whether or not then exercisable under
Paragraph 3 of this Agreement) may be exercised, in whole or in part, to the
extent not previously exercised, forfeited, revoked or modified, only during the
period (i) beginning on the date of your death; and (ii) ending on and including
the earlier of (A) July 26, 2010 or (B) the third anniversary of the date of
your death.
c. Death After Termination of Employment Because of Retirement or
Disability. If you die after your employment with the Company terminates due to
Retirement or Disability, the Stock Option (whether or not then exercisable
under Paragraph 4(a) of this Agreement) may be exercised, in whole or in part,
to the extent not previously exercised, forfeited, revoked or modified, only
during the period (i) beginning on the date of your death; and (ii) ending on
and including the earlier of (A) July 26, 2010 or (B) the third anniversary of
the date your employment with the Company terminates due to Retirement or
Disability.
d. Termination of Employment for Reasons Other than Retirement,
Disability or Death. If your employment with the Company terminates for any
reason other than Retirement, Disability or death, the Stock Option (whether or
not then exercisable under Paragraph 3 of this Agreement), to the extent not
previously exercised, shall be forfeited at the time of such termination of
employment.
e. Definition of Retirement. For purposes of Paragraphs 4 and 8
of this Agreement, "Retirement" means retirement from employment with the
Company or any of its Subsidiaries pursuant to the qualified defined benefit
retirement plan of such entity applicable to you. If you are an Employee of a
Subsidiary of the Company which does not have in effect a qualified defined
benefit retirement plan at the time you cease employment with such Subsidiary
(other than cessation of employment due to death, Disability, or transfer to the
Company or any of its other Subsidiaries), Retirement from such Subsidiary shall
mean your cessation of employment with that Subsidiary at or after age 55.
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f. Definitions. For purposes of Paragraphs 4 and 8 of this
Agreement, (i) employment with the Company includes employment with any
Subsidiary of the Company; and (ii) termination of employment with the Company
means you are no longer an employee of the Company or any of its Subsidiaries.
5. Stock Option Exercise Procedures. Subject to the terms and conditions
of the Plan and this Agreement, you (or, pursuant to Paragraph 7 of this
Agreement, a party acting on your behalf after your death) may exercise the
Stock Option in whole or, from time to time, in part pursuant to the procedures
described in the Prospectus relating to the Plan or as otherwise specified by
the Company from time to time. Payment of the full purchase price of the shares
of Stock covered by the exercise shall be made in the manner prescribed by the
Committee from time to time. If the Committee, in its sole discretion, shall
determine that it is appropriate to do so, such payment may be made in whole or
in part by tender of shares of unrestricted Stock, as set forth in Section 5 of
the Plan, subject to such requirements or procedures as the Committee may
specify.
6. Tax Withholding. The Company may in its sole discretion withhold from
the shares of Stock issued to you a sufficient number of shares of Stock based
on its fair market value on the date of exercise to cover any amounts which the
Company is required to withhold to comply with withholding requirements of
federal, state, local or foreign tax laws, rules or regulations. The fair market
value for purposes of the second sentence of this paragraph shall be as
determined by the Committee.
7. Restrictions on Transferability. The Stock Option is not transferable
otherwise than by will, by the laws of descent and distribution, or by a written
designation referred to in Section 10(c) of the Plan, and is exercisable during
your lifetime only by you. In the event that the Stock Option is to be exercised
by any person other than you, the written notice referred to in Paragraph 5 of
this Agreement shall be accompanied by appropriate proof of the right of such
person to exercise the Stock Option.
8. Forfeiture, Revocation or Modification of Award. In addition to
Paragraph 4(d) of this Agreement (and in lieu of the provisions of Section 10 of
the Plan), the Stock Option shall be subject to forfeiture, revocation or
modification as follows:
a. Non-Competition Agreement After Early Retirement. If your
employment with the Company terminates due to Retirement prior to age 65, if you
are not then on the pilot seniority list of the Company or any of its
Subsidiaries, or age 60, if you are then on such a seniority list, and, within
two years after such Retirement and without the Committee's approval, you
directly or indirectly provide 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, the Stock Option (whether or not then exercisable under
Paragraph 4(a) of this Agreement) shall be forfeited at the time you first
provide such management or executive services. Because of the broad and
extensive scope of the Company's air transportation business, you acknowledge
that the restrictions in this paragraph are intended to extend to management or
executive services which are directly related to the
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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.
b. Demotion. If, prior to July 27, 2004, you voluntarily suggest
and then accept a demotion, or are involuntarily demoted, to a position with the
Company or any of its Subsidiaries involving lesser responsibilities than those
of the job held by you on July 27, 2000, the Committee may in its sole
discretion, not later than six months from the date of the demotion, revoke or
modify the Stock Option in any manner it deems appropriate under the
circumstances. The Committee will determine in its sole discretion what
constitutes a demotion to a job involving lesser responsibilities under this
paragraph.
9. Federal Securities Law; Company Policies. You acknowledge that the
federal securities laws and/or the Company's policies regarding trading in its
securities may limit or restrict your right to buy or sell shares of Stock,
including, without limitation, sales of Stock to exercise the Stock Option or
sales of Stock acquired pursuant to the exercise of the Stock Option. You agree
to comply with such federal securities law requirements and Company policies, as
such laws and policies are amended from time to time.
10. Miscellaneous
a. Authority of the Committee. The Committee has the sole and
complete authority to construe and interpret the Plan and this Agreement. All
determinations of the Committee shall be final and conclusive for all purposes
and upon all persons. The Committee shall be under no obligation to construe
this Agreement or treat the Stock Option in a manner consistent with the
treatment provided with respect to other Stock Options or Participants.
b. No Rights as Shareholder. You will not have any rights to
dividends nor any other rights of a shareholder with respect to the Option
Shares until the Option Shares have been issued following a valid exercise of
the Stock Option.
c. Entire Agreement. Subject to any written executive retention
protection agreement, if any, entered into between and executed by you and the
Company, this Agreement and the Plan constitute the entire agreement between you
and the Company with respect to the subject matter hereof. This Agreement may
not be amended except by a writing signed by the parties.
This Agreement has been prepared in duplicate. Please note your
acceptance in the space provided therefor and return one original to the Vice
President - Global Rewards & Recognition (Dept. 959-ATG) for the Company's
records.
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IN WITNESS WHEREOF, the Company, acting through the Committee, and you
have executed this Agreement, all as of the date first written above.
DELTA AIR LINES, INC.
By:
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Leo F. Mullin
Chairman of the Board and
Chief Executive Officer
PARTICIPANT
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