DELTA AIR LINES, INC. (NYSE:DAL) Files An 8-K Entry into a Material Definitive Agreement
Item1.01 Entry into a Material Definitive Agreement
On March9, 2017, Delta Air Lines, Inc. (Delta or we) entered into
an underwriting agreement (the Underwriting Agreement) with
Barclays Capital Inc., Goldman, Sachs Co., J.P. Morgan Securities
LLC and Morgan Stanley Co. LLC as the representatives of the
underwriters named therein (the Underwriters), to issue and sell
$2.0 billion in aggregate principal amount of unsecured notes,
consisting of $1,000,000,000 in aggregate principal amount of our
2.875% Notes due 2020 (the 2020 Notes) and $1,000,000,000 in
aggregate principal amount of our 3.625% Notes due 2022 (the 2022
Notes and, together with the 2020 Notes, the Notes). The
Underwriting Agreement includes customary representations,
warranties and covenants, including an agreement to indemnify the
Underwriters against certain liabilities. The public offering of
the Notes was completed on March14, 2017. The Notes were
registered under the Securities Act of 1933, as amended, to an
automatic shelf registration statement on Form S-3ASR (File
No.333-216463) (the Registration Statement), filed with the
Securities and Exchange Commission (the Commission) on March6,
2017, and a related prospectus, including a prospectus
supplement, filed with the Commission. The above description of
the Underwriting Agreement does not purport to be complete and is
qualified in its entirety by reference to the Underwriting
Agreement, filed herewith as Exhibit 1.1, and incorporated herein
by reference.
The Notes were issued under an indenture, dated as of March6,
2017 (the Base Indenture), as supplemented by that certain First
Supplemental Indenture, dated March14, 2017 (the Supplemental
Indenture and, together with the Base Indenture, the Indenture),
each between the Company and U.S. Bank National Association, as
trustee.The Base Indenture was filed as Exhibit 4.1 to the
Registration Statement and is incorporated herein by reference.
The Supplemental Indenture is filed herewith as Exhibit 4.1 and
incorporated herein by reference.
The Notes are our direct, unsecured and unsubordinated
obligations. The Notes rank pari passu, or equal, in
right of payment, with all of our other unsubordinated
indebtedness and senior in right of payment to all of our future
subordinated debt. We will pay interest semi-annually in arrears
for the 2020 Notes on March13 and September13 of each year,
beginning on September13, 2017, and for the 2022 Notes on March15
and September15 of each year, beginning on September15, 2017. The
2020 Notes will mature on March13, 2020, and the 2022 Notes will
mature on March15, 2022.
The Indenture contains certain covenants that, among other
things, limit our ability to incur liens securing indebtedness
for borrowed money or capital leases and engage in mergers and
consolidations or transfer all or substantially all of our
assets, in each case subject to a number of important exceptions
as specified in the Indenture. The Indenture also contains
customary event of default provisions.
We may redeem the 2020 Notes at our option at any time prior to
the maturity date of the 2020 Notes, in whole or in part, at the
applicable redemption price, plus accrued and unpaid interest on
the principal amount of the Notes to be redeemed to the date of
redemption. We may redeem the 2022 Notes at our option at any
time prior to February15, 2022 (one month prior to the maturity
date of the 2022 Notes), in whole or in part, at the applicable
redemption price, plus accrued and unpaid interest thereon to the
date of redemption. At any time on or after February15, 2022 (one
month prior to the maturity date of the 2022 Notes), we may
redeem the 2022 Notes, in whole or in part, at a redemption price
equal to 50% of the principal amount of the Notes to be redeemed,
plus accrued and unpaid interest thereon to the date of
redemption. If we experience a Change of Control (as defined in
the Supplemental Indenture) and a ratings decline of either
series of Notes by two of the Ratings Agencies (as defined in the
Supplemental Indenture) to a rating below investment grade within
a certain period of time following a Change of Control or public
notice of the occurrence of a Change of Control, we must offer to
repurchase such series at a price equal to 101% of the principal
amount of such series, plus accrued and unpaid interest thereon
to the repurchase date.
We intend to use the net proceeds from the offering of the Notes
to fund discretionary contributions to our defined benefit plans.
The foregoing descriptions of the Underwriting Agreement, the
Notes, the Base Indenture and the Supplemental Indenture are
summaries only and are qualified in their entirety by reference
to the full text of such documents. The forms of the Notes issued
to the Indenture are filed herewith as Exhibits 4.2 and 4.3, and
the terms and conditions thereof are incorporated by reference
herein. The forms of the Notes are also filed with reference to,
and are hereby incorporated by reference into, the Registration
Statement.
The agreements included as exhibits to this Current Report on
Form 8-K are included to provide information regarding their
terms and are not intended to provide any other factual or
disclosure information about Delta or the other parties to the
agreements. The agreements may contain representations and
warranties by each of the parties to the applicable agreement.
These representations and warranties have been made solely for
the benefit of the other parties to the applicable agreement and:
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should not in all instances be treated as categorical statements of fact, but rather as a way of allocating the risk to one of the parties if those statements prove to be inaccurate; |
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may have been qualified by disclosures that were made to the other party in connection with the negotiation of the applicable agreement, which disclosures would not necessarily be reflected in the agreement; |
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may apply standards of materiality in a way that is different from what may be viewed as material to other investors; and |
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were made only as of the date of the applicable agreement or such other date or dates as may be specified in the agreement and are subject to more recent developments. |
Accordingly, these representations and warranties may not
describe the actual state of affairs as of the date they were
made or at any other time. Additional information about Delta may
be found elsewhere in this Current Report on Form 8-K and our
other public filings, which are available without charge through
the Commissions website at http://www.sec.gov.
Item2.03 Creation of a Direct Financial Obligation or an
Obligation under an Off-Balance Sheet Arrangement of a
Registrant
The information set forth in Item1.01 of this Current Report on
Form 8-K is incorporated herein by reference, insofar as it
relates to the creation of a direct financial obligation.
Item8.01 Other Events.
In connection with the offering of the Notes, we are filing the
legal opinions relating to the offering as Exhibits 5.1 and 5.2
to this Current Report on Form 8-K, which legal opinions are
incorporated by reference into the Registration Statement.
Item9.01 Financial Statements and Exhibits.
(d) Exhibits.
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Exhibit1.1 |
Underwriting Agreement, dated March9, 2017, by and among Delta Air Lines, Inc., as issuer, and Barclays Capital Inc., Goldman, Sachs Co., J.P. Morgan Securities LLC and Morgan Stanley Co. LLC, as representatives of the several underwriters named therein |
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Exhibit 4.1 |
First Supplemental Indenture, dated as of March 14, 2017, between Delta Air Lines, Inc. and U.S. Bank National Association, as Trustee |
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Exhibit 4.2 |
Form of Delta Air Lines, Inc. 2.875% Notes due 2020 | |
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Exhibit 4.3 |
Form of Delta Air Lines, Inc. 3.625% Notes due 2022 | |
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Exhibit 5.1 |
Opinion of Kilpatrick Townsend Stockton LLP | |
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Exhibit 5.2 |
Opinion of Alan T. Rosselot, Esq., Assistant General Counsel of Delta Air Lines, Inc. |
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Exhibit23.1 |
Consent of Kilpatrick Townsend Stockton LLP (included in Exhibit 5.1) |
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Exhibit23.2 |
Consent of Alan T. Rosselot, Esq., Assistant General Counsel of Delta Air Lines, Inc. (included in Exhibit 5.2) |
About DELTA AIR LINES, INC. (NYSE:DAL)
Delta Air Lines, Inc. provides scheduled air transportation for passengers and cargo throughout the United States and around the world. The Company’s operates through segments, including Airline Segment and Refinery Segment. The Airline segment is managed as a single business unit that provides scheduled air transportation for passengers and cargo throughout the United States and around the world and other ancillary airline services. The Refinery Segment produces gasoline, diesel and jet fuel. Its wholly owned subsidiaries, Monroe Energy, LLC and MIPC, LLC operate the Trainer refinery and related assets located near Philadelphia, Pennsylvania. The Company also offers cargo services, aircraft maintenance, repair and overhaul (MRO), staffing services for third parties, vacation wholesale operations and private jet operations. DELTA AIR LINES, INC. (NYSE:DAL) Recent Trading Information
DELTA AIR LINES, INC. (NYSE:DAL) closed its last trading session down -1.07 at 46.28 with 6,995,340 shares trading hands.