SC TO-C

As filed with the Securities and Exchange Commission on April 7, 2003

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE TO

Tender Offer Statement under Section 14(d)(1) or 13(e)

of the Securities Exchange Act of 1934

DELTA AIR LINES, INC.

(Name of Subject Company (Issuer) and Filing Person (Offeror))

Options to Purchase Common Stock, Par Value $1.50 Per Share

(Title of Class of Securities underlying options)

247361108

(CUSIP Number of Class of Securities)

Robert S. Harkey

Senior Vice President-General Counsel & Secretary

Delta Air Lines, Inc.

Hartsfield Atlanta International Airport

Atlanta, Georgia 30320

TELEPHONE: (404) 715-2600

FACSIMILE: (404) 715-2233

(Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications on behalf of Filing Person)

Copy to:

Elizabeth G. Wren, Esq.

Kilpatrick Stockton LLP

3500 One Wachovia Center

301 S. College Street

Charlotte, North Carolina 28202

(704) 338-5123

Calculation of Filing Fee*

Transaction valuation*	Amount of Filing Fee
Not Applicable	Not Applicable

* No filing fee is required because this filing contains only preliminary communications made before the commencement of a tender offer.

[   ]	Check box if any part of the fee is offset as provided by Rule 0-11(a)(2) and identify the filing with which the offsetting fee was previously paid.
	Identify the previous filing by registration statement number, or the form or schedule and the date of its filing.

Amount Previously Paid: Not Applicable	Filing Party: Not Applicable
Form or Registration No.: Not Applicable	Date Filed: Not Applicable

[X]	Check the box if the filing relates solely to preliminary communications made before the commencement of a tender offer.
	Check the appropriate boxes below to designate any transactions to which the statement relates:
[   ]	Third-party tender offer subject to Rule 14d-1.
[X]	Issuer tender offer subject to Rule 13e-4.
[   ]	Going-private transaction subject to Rule 13e-3.
[   ]	Amendment to Schedule 13D under Rule 13d-2.
	Check the following box if the filing is a final amendment reporting the results of the tender offer. [   ]

2

Attached is a presentation about a proposal contained in the Notice of Annual Meeting of Shareowners and Proxy Statement of Delta Air Lines, Inc. for its Annual Meeting of Shareowners to be held on April 25, 2003. The presentation concerns proposed amendments to Delta’s 2000 Performance Compensation Plan, DeltaShare Stock Option Plan and Pilots Stock Option Plan (collectively, the “Plans”) to authorize Delta to undertake a stock option exchange program (the “Exchange Program”). The presentation is being posted on Delta’s intranet site and made available to employees.

The presentation does not constitute an offer to holders of options to purchase Delta Common Stock to exchange their options. If Delta’s shareowners approve the amendments to the Plans, the Exchange Program may be commenced in the discretion of Delta’s Board of Directors within a reasonable time following shareowner approval, but the Board could choose not to proceed with the Exchange Program.

At the time the Exchange Program is commenced, Delta will provide to option holders who are eligible to participate in the Exchange Program written materials explaining the terms, conditions and timing of the Exchange Program. Persons who are eligible to participate in the Exchange Program should read these written materials carefully when they become available because they will contain important information about the Exchange Program. Delta will also post these written materials on its website, www. delta.com, and file the materials with the Securities and Exchange Commission as part of a tender offer statement. Delta shareowners and option holders will be able to obtain these written materials and other documents filed by Delta with the Securities and Exchange Commission free of charge from the Securities and Exchange Commission’s website at www.sec.gov.

Item 12. Exhibits.

Exhibit No.	Description
99.2	Power Point presentation concerning proposed amendments to the Plans that would authorize a stock option exchange program.

3

INDEX TO EXHIBITS

Exhibit No.	Description
99.2	Power Point presentation concerning proposed amendments to the Plans that would authorize a stock option exchange program.

4 EX-99.2 3 g81839exv99w2.htm EX-99.2 POWERPOINT PRESENTATION

Exhibit 99.2

Summary of the Stock Option Exchange Program _________ Under Proposed Amendments to 2000 Performance Compensation Plan and SkyShares - the DeltaShare Stock Option Plan and Pilots Stock Option Plan ___________ Proxy Statement Proposal 3

Introduction At the April 25 shareowners meeting, shareowners will be asked to approve amendments to the SkyShares plans and the management equity compensation plan. If shareowners approve the amendments, Delta could conduct a stock option exchange program for eligible option holders in the SkyShares and management plans. Eligible employees could later decide if they want to participate in a stock option exchange program. If the amendments are not approved by shareowners, eligible employees would not have the opportunity to participate in a stock option exchange program. The following slides summarize the key elements of a stock option exchange program under proposal 3 of Delta's Proxy Statement dated March 25, 2003. For a full description, see pages 34-39 of the Proxy Statement. 2

Why is Delta proposing an option exchange? Stock options provide incentives to retain and motivate employees and align their interests with shareowners. All SkyShares (37.4 million shares) and management options (21.1 million shares) are underwater (i.e., options have an exercise price greater than the stock's current market value). Current market value would have to increase three to seven times for current options to be "in the money". Significantly underwater options do not accomplish the retention and performance incentives and alignment of employee interests with those of shareowners. 3

Two approaches to a stock option exchange: 1. Cancel current options and grant replacement options on the same day. Requires variable accounting and therefore a compensation expense charge to Delta's earnings (FAS 123) 2. Cancel current options and grant replacement options at least 6 months and 1 day after the date of cancellation of current options. Avoids variable accounting (APB 25) Delta is proposing approach #2 above, the "6 month and 1 day" waiting period, to avoid variable accounting for the grant of replacement options. How will the exchange work? 4

Option Exchange Design Elements Exchange Format During an offering period of no less than 20 business days, eligible employees can elect to cancel outstanding options in exchange for a grant of a lesser number of replacement options at least 6 months and 1 day after cancellation of outstanding options. Eligible Options Options granted from 1995 through 2002 at an exercise price of $25 or more. Note that the October 2002 grant at $10.53 is excluded. Exercise Price The exercise price of the replacement options will be the closing price of Delta common stock on the NYSE on the date replacement options are granted (at least 6 months and 1 day after cancellation of outstanding options). 5

Option Term Each replacement option will have a term equal to the remaining term of the associated canceled option. For example, if a canceled option had a term of 3 years and 4 months remaining at cancellation, then the associated replacement option would have a term of 3 years and 4 months from the date of its grant. Exercisability All replacement options granted under SkyShares will become exercisable one year after their grant date. Replacement options granted under the management plan will become exercisable over two years (50% each on the first and second anniversaries of their grant date), and replacement options for executive officers will become exercisable over four years (25% on each of the first four anniversaries of their grant date). Replacement options granted in exchange for the approximately 120,000 outstanding options granted in 1995 will become exercisable in full on the first anniversary of their grant date due to the limited option term remaining at the time the replacement options are granted. Option Exchange Design Elements 6

Exchange Ratios This is a "value-for-value" exchange, i.e., at the time of the Annual Meeting, the aggregate value of options eligible for cancellation is intended to be approximately equivalent to the aggregate value of the replacement options that would be associated with the eligible options. Mercer Human Resource Consulting, a nationally recognized consulting firm, worked with Delta to value the canceled and replacement options and to develop exchange ratios in accordance with standard practice, all of which have been approved by Delta's Board of Directors. The value of the canceled and replacement options and exchange ratios was determined using the Black-Scholes stock option valuation model. 7 Option Exchange Design Elements

Exchange Ratios The exchange of canceled options for replacement options will be based on the following ratios: Tier Grant Date Exchange Ratio 1 1995 - 1999 get 1 replacement option by giving up 3 current options 2 2000 - 2001 get 1 replacement option by giving up 2 current options 3 2002 get 1 replacement option by giving up 1.5 current options Options within a tier must be exchanged on an all-or-nothing basis. All SkyShares options fall within Tier 1. Fractional options will be rounded up to the nearest whole option. Replacement options become exercisable and non-forfeitable on a change in control of Delta. Eligible options include only those granted between 1995 and 2002 with an exercise price of $25 or greater. Option Exchange Design Elements 8

Eligible Participants Eligibility to participate in the exchange program will be generally limited to "eligible employees" of Delta and its wholly-owned subsidiaries who hold eligible options -- active employees and those on military and short-term leaves defined by the Personnel & Compensation Committee of the Board. To be eligible to participate in the program, an employee must be an "eligible employee" on each of the following dates: Date the exchange program commences Last day of the offering period to participate in the exchange Date replacement options are granted Chairman and CEO, Leo Mullin, and other members of the Board of Directors will be excluded from the exchange program. Option Exchange Design Elements 9

Provisions Applicable Only to Replacement Stock Options Granted to Mr. Reid, Ms. Burns, Ms. Escarra and Mr. Colman ("Executive Officers") Executive Officers who participate in the exchange program will: receive only 90% of the replacement stock options to which he or she would be entitled under the exchange ratios be required to hold for one year the underlying common stock received upon exercise of replacement options, subject to limited exceptions. Replacement options granted to Executive Officers will become exercisable in 25% increments on each of the first four anniversaries of their grant date. Option Exchange Design Elements 10

EX-99.2

EX-99.2 POWERPOINT PRESENTATION