S-3

As filed with the Securities and Exchange Commission on August 22, 2003

Registration No. 333-            

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM S-3

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 Incorporation or Organization)	(I.R.S. Employer Identification Number)

Hartsfield Atlanta International Airport

Atlanta, Georgia 30320

(404) 715-2000

(Address, Including Zip Code, and Telephone Number, Including Area Code, of Registrant’s Principal Executive Offices)

Robert S. Harkey, Esq.

Senior Vice President-General Counsel and Secretary

Delta Air Lines, Inc.

P.O. Box 20706

Atlanta, Georgia 30320-6001

(404) 715-2387

(Name, Address, Including Zip Code, and Telephone Number, Including Area Code, of Agent For Service)

Copy to:

Francis J. Morison, Esq.

Davis Polk & Wardwell

450 Lexington Avenue

New York, NY 10017

(212) 450-4000

Approximate date of commencement of proposed sale to the public:  From time to time after this Registration Statement becomes effective.

If the only securities being registered on this Form are being offered pursuant to dividend or interest reinvestment plans, please check the following box.  ¨

If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, other than securities offered only in connection with dividend or interest reinvestment plans, check the following box.  x

If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.  ¨

If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.  ¨

If delivery of the prospectus is expected to be made pursuant to Rule 434, please check the following box.  ¨

CALCULATION OF REGISTRATION FEE

Title of Securities to be Registered	Amount to be Registered			Proposed Maximum Offering Price Per Unit(1)		Proposed Maximum Aggregate Offering Price(1)			Amount of Registration Fee
8.00% Convertible Senior Notes due 2023	$	350,000,000	(2)	100	%	$	350,000,000	(2)	$	28,315
Common Stock, par value $1.50 per share and related rights		12,500,005	(3)	(3	)		(3	)		(3	)

(1) Estimated solely for the purpose of calculating the registration fee pursuant to rule 457(o) of the Securities Act of 1933, as amended, and exclusive of any accrued interest, if any.

(2) Represents the aggregate outstanding principal amount of 8.00% Convertible Senior Notes due 2023.

(3) Represents the number of shares of our common stock that are issuable upon conversion of the 8.00% Convertible Senior Notes due 2023 registered hereby at an initial conversion price of $28.00 per share. Pursuant to rule 416 under the Securities Act, the number of shares of common stock registered hereby shall include an indeterminate number of shares of common stock that may be issued in connection with a stock split, stock dividend, recapitalization or similar event. No separate consideration will be received for the shares of our common stock issuable upon conversion of the 8.00% Convertible Senior Notes due 2023 and, therefore, no registration fee is required pursuant to Rule 457(i) under the Securities Act.

The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the Registration Statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine.

THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. THESE SECURITIES MAY NOT BE SOLD UNTIL THE REGISTRATION STATEMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE. THIS PROSPECTUS IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT SOLICITING AN OFFER TO BUY THESE SECURITIES IN ANY STATE WHERE THE OFFER OR SALE IS NOT PERMITTED.

SUBJECT TO COMPLETION, DATED AUGUST 22, 2003

PROSPECTUS

$350,000,000

8.00% Convertible Senior Notes due 2023 and the

Common Stock Issuable Upon Conversion of the

8.00% Convertible Senior Notes due 2023

We issued $350 million principal amount of the 8.00% Convertible Senior Notes due 2023 in private placements in June 2003. This prospectus will be used by selling securityholders to resell their debt securities and the common stock issuable upon conversion of the debt securities. We will not receive any of the proceeds from the sale of these securities.

Interest on the notes is payable on June 3 and December 3 of each year, beginning on December 3, 2003.

The notes are convertible by holders into shares of our common stock at a conversion price of $28.00 per share (subject to adjustment), which is equivalent to a conversion rate of approximately 35.7143 shares per $1,000 principal amount of notes, under the following circumstances: (1) if the price of our common stock reaches, or the trading price of the notes falls below, specific thresholds, (2) if we call the notes for redemption, or (3) upon the occurrence of certain corporate transactions.

Our common stock is listed on the New York Stock Exchange under the symbol “DAL.” The last reported price of our common stock on August 21, 2003 was $12.41 per share.

The notes will mature on June 3, 2023. We may redeem all or a portion of the notes at any time on or after June 5, 2008 at 100% of the principal amount of the notes, plus any accrued and unpaid interest.

Holders of the notes may require us to purchase all or a portion of their notes in cash at a purchase price equal to 100% of the principal amount of notes, plus accrued and unpaid interest, on June 3, 2008, June 3, 2013 and June 3, 2018 or upon a designated event.

The notes will be our senior unsecured obligations and will rank equal in right of payment to all of our other existing and future senior unsecured indebtedness. The notes will be effectively subordinated to all of our existing and future secured indebtedness to the extent of the assets securing that indebtedness. The notes will be structurally subordinated to all liabilities of our subsidiaries.

Investing in these securities involves certain risks. See “ Risk Factors” beginning on page 9.

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved these securities, or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.

The date of this prospectus is             , 2003

TABLE OF CONTENTS

	Page
Forward-Looking Statements	2
Where You Can Find More Information	2
Prospectus Summary	3
Risk Factors	9
The Company	16
Recent Developments	16
Use of Proceeds	17
Common Stock and Dividend Data	17
Description of Notes	19
Description of Capital Stock	36
Selling Securityholders	40
Certain U.S. Federal Income Tax Consequences	41
Plan of Distribution	45
Validity of the Securities	48
Experts	48

Unless the context otherwise requires, the terms “Delta,” “we,” “us,” and “our” refer to Delta Air Lines, Inc.

This prospectus is part of a registration statement that we filed with the SEC using a “shelf” registration or continuous offering process. Under this shelf process, selling securityholders may from time to time sell the securities described in this prospectus in one or more offerings.

This prospectus provides you with a general description of the securities that the selling securityholders may offer. Each time a selling securityholder sells securities, the selling securityholders are required to provide you with a prospectus and/or a prospectus supplement containing specific information about the selling securityholder and the terms of the securities being offered. A prospectus supplement may include other special considerations applicable to those securities. The prospectus supplement may also add, update or change information in this prospectus. If there is any inconsistency between the information in this prospectus and any prospectus supplement, you should rely on the information in that prospectus supplement. You should read both this prospectus and any prospectus supplement together with the additional information described under the heading “Where You Can Find More Information.”

The registration statement containing this prospectus, including the exhibits to the registration statement, provides additional information about us and the securities offered under this prospectus. The registration statement, including the exhibits, can be read on the SEC web site or at the SEC offices mentioned under the heading “Where You Can Find More Information.”

You should rely only on the information contained in this document and in the information to which we have referred you. We have not authorized anyone to provide you with information that is different. This prospectus may only be used where it is legal to sell these securities. The information in this prospectus may only be accurate on the date of this prospectus.

FORWARD-LOOKING STATEMENTS

This prospectus contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”) and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) which represent Delta’s expectations or beliefs concerning future events. When used in this prospectus, and in documents incorporated by reference, the words “expects,” “plans,” “anticipates”, and similar expressions are intended to identify forward-looking statements. All forward-looking statements in this prospectus are based upon information available to us on the date of this prospectus. We undertake no obligation to update publicly or revise any forward-looking statement, whether as a result of new information, future events or otherwise. Forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from historic experience or our expectations. Additional information concerning these and other factors is contained in our SEC filings, including but not limited to Delta’s Forms 10-K, 10-Q and 8-K.

WHERE YOU CAN FIND MORE INFORMATION

Delta files annual, quarterly and special reports, proxy statements and other information with the SEC. You may read and copy any document filed by Delta at the SEC’s public reference rooms at 450 Fifth Street, NW, Washington, D.C. 20549. Please call the SEC at 1-800-SEC-0330 for further information on the public reference rooms. Delta’s SEC filings are also available to the public over the internet at http://www.sec.gov.

We incorporate by reference the documents listed below and any filings made with the SEC under Section 13(a), 13(c), 14 or 15(d) of the Exchange Act after the date of this prospectus and prior to the termination of this offering (other than current reports furnished on Form 8-K under Items 9 and 12).

• Annual Report on Form 10-K for the fiscal year ended December 31, 2002.

• Quarterly Reports on Form 10-Q for the quarters ended March 31, 2003 and June 30, 2003.

• Current Reports on Form 8-K filed January 16, 2003, March 10, 2003, March 25, 2003*, April 17, 2003*, April 23, 2003, May 27, 2003, May 29, 2003, June 2, 2003, July 1, 2003, July 17, 2003*, July 25, 2003 and August 13, 2003.

* Reports submitted to the SEC under Item 9, Regulation FD Disclosure and Item 12, Results of Operations and Financial Condition. Pursuant to General Instruction B(2) and (6) of Form 8-K, the reports submitted under Items 9 and 12 are not deemed to be “filed” for the purpose of Section 18 of the Exchange Act, and Delta is not subject to the liabilities of that section. Delta is not incorporating and will not incorporate by reference future filings of these reports into a filing under the Securities Act or the Exchange Act or into this prospectus.

The information incorporated by reference in this prospectus is considered to be a part of this prospectus, and information that we file later with the SEC, prior to the termination of this offering, will automatically update and supersede this information.

Any party to whom this prospectus is delivered may request a copy of these filings (other than any exhibits unless specifically incorporated by reference into this prospectus), at no cost, by writing or telephoning Delta at Delta Air Lines, Inc., Investor Relations, Dept. No. 829, P.O. Box 20706, Atlanta, GA 30320, telephone no. (404) 715-2600.

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PROSPECTUS SUMMARY

This summary may not contain all the information that may be important to you. You should read the entire prospectus, including the financial data and related notes included in this prospectus and other information incorporated by reference herein, before making an investment decision.

The Offering

Issuer	Delta Air Lines, Inc., a Delaware corporation.
Securities Offered	$350,000,000 aggregate principal amount of 8.00% Convertible Senior Notes due 2023.
Offering Price	100% of the principal amount of the notes, plus accrued interest, if any, from June 2, 2003.
Maturity	June 3, 2023.
Interest Payment Dates	June 3 and December 3 of each year, commencing on December 3, 2003.
Conversion Rights	The notes are convertible at the option of the holder prior to maturity, into shares of our common stock at a conversion price of $28.00 per share, subject to adjustment, which is equivalent to an initial conversion rate of approximately 35.7143 shares per $1,000 principal amount of notes, under any of the following circumstances: (i)     during any calendar quarter after the quarter ending June 30, 2003, if the last reported sale price of our common stock for at least 20 trading days during the period of 30 consecutive trading days ending on the last trading day of the immediately preceding calendar quarter is greater than or equal to 130% of the conversion price per share of our common stock; (ii)    during the five-business-day period following any ten consecutive trading days in which the average of the trading prices for the notes was less than 98% of the average closing sale price of our common stock multiplied by the conversion rate; (iii)  if the notes have been called for redemption by us; or (iv)   upon the occurrence of specified corporate transactions described under “Description of Notes—Conversion Rights—Conversion Upon Specified Corporate Transactions.” The conversion rate may be adjusted upon the occurrence of certain events, but it will not be adjusted for any accrued and unpaid interest.

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Optional Redemption	On or after June 5, 2008, upon at least 30 days’ notice, we may redeem for cash all or a portion of the notes at any time for a price equal to 100% of the principal amount of the notes to be redeemed, plus any accrued and unpaid interest to but excluding the redemption date. See “Description of Notes—Optional Redemption.”
Purchase of Notes by Us at the Option of the Holder	Holders of the notes will have the right to require us to purchase all or a portion of their notes for cash on June 3, 2008, June 3, 2013 and June 3, 2018, each of which we refer to as a purchase date. In each case, we will pay a purchase price equal to 100% of the principal amount of notes to be purchased, plus any accrued and unpaid interest, to but excluding the purchase date. See “Description of Notes—Purchase of Notes by Us at the Option of the Holder” and “Risk Factors—We may be unable to repay or repurchase the notes.”
Repurchase at the Option of Holders Upon a Designated Event	Upon a designated event (as defined herein), holders of the notes will have the right to require us to repurchase all or a portion of their notes at a purchase price equal to 100% of the principal amount of the notes to be repurchased, plus any accrued and unpaid interest to but excluding the date of the repurchase. See “Description of Notes—Repurchase at Option of Holders Upon a Designated Event” and “Risk Factors—We may be unable to repay or repurchase the notes.”
Ranking	The notes are our senior unsecured obligations and are rank equal in right of payment to all of our other existing and future senior unsecured indebtedness. The notes are effectively subordinated to all of our existing and future secured indebtedness to the extent of the assets securing that indebtedness. The notes are structurally subordinated to all liabilities of our subsidiaries. As of June 30, 2003, we had approximately $12.2 billion of total consolidated indebtedness; $5.9 billion of secured indebtedness (excluding secured indebtedness of our subsidiaries); and approximately $1.8 billion of subsidiary indebtedness.
Events of Default	The following will be events of default under the indenture for the notes: •      we fail to pay principal of any note when due; •      we fail to pay interest or liquidated damages, if any, on any note when due and that default continues for 30 days or more;

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	•      we fail to comply with or observe any other covenant or warranty in the indenture or in the notes and that failure continues for 60 days or more after written notice as provided in the indenture; •      we fail to pay any designated event repurchase price when due; •      we or any of our restricted subsidiaries (as defined herein) fail to pay when due, either at its final stated maturity or upon acceleration thereof, any indebtedness (other than indebtedness which is non-recourse to us or any restricted subsidiary) for money borrowed equal to $75 million or more and such failure is not cured, or the acceleration is not rescinded or annulled, within 30 days after written notice as provided in the indenture; and •      certain events of our bankruptcy, insolvency or reorganization. See “Description of Notes—Events of Default and Remedies.”
Registration Rights	We have agreed to file a shelf registration statement under the Securities Act relating to resales of the notes and the common stock issuable upon their conversion. If such registration statement is not filed or has not become effective within the time periods set forth herein, we will be required to pay additional amounts to holders of the notes and holders of the common stock issued upon conversion of the notes. See “Description of Notes—Registration Rights.”
Book-entry Form	The notes were issued in book-entry form and are represented by permanent global certificates deposited with, or on behalf of, The Depository Trust Company (“DTC”) and registered in the name of a nominee of DTC. Beneficial interests in any of the notes will be shown on, and transfers of the notes will be effected only through, records maintained by DTC or its nominee and any such interest may not be exchanged for certificated securities, except under limited circumstances.
Use of Proceeds	We will not receive any of the proceeds from the sale by the selling securityholder of the notes and the common stock issuable upon conversion of the notes.
Trading	The notes are currently eligible for trading on the PORTAL Market of the National Association of Securities Dealers, Inc. (the “PORTAL Market”); however, notes sold using this prospectus will no longer be eligible for trading in the PORTAL Market. Our common stock is quoted on the New York Stock Exchange under the symbol “DAL.”

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Selected Financial and Operating Data

The following table presents selected financial and operating data of Delta. We derived the annual historical financial data from Delta’s audited consolidated financial statements and the notes thereto. The audited consolidated financial statements as of December 31, 2002 and 2001 and for the years ended December 31, 2002, 2001 and 2000 are incorporated by reference in this prospectus and the selected financial and operating data should be read in conjunction with those financial statements. The consolidated financial data as of June 30, 2003 and for the six months ended June 30, 2003 and 2002 were derived from Delta’s unaudited consolidated financial statements and may not be indicative of results for the year as a whole. See “Where You Can Find More Information.”

	Six months ended June 30,						Years ended December 31,
	2003(1)			2002(2)			2002(3)			2001(4)			2000(5)			1999(6)			1998
	(unaudited)
Statement of Operations Data (in millions, except per share data):
Operating revenues	$	6,462		$	6,577		$	13,305		$	13,879		$	16,741		$	14,883		$	14,312
Operating expenses		6,801			7,139			14,614			15,481			15,104			13,565			12,509
Operating income (loss)		(339	)		(562	)		(1,309	)		(1,602	)		1,637			1,318			1,803
Interest expense, net(7)		338			296			610			410			257			126			66
Net income (loss) before cumulative effect of change in accounting principle		(282	)		(583	)		(1,272	)		(1,216	)		928			1,262			1,078
Net income (loss)		(282	)		(583	)		(1,272	)		(1,216	)		828			1,208			1,078
Earnings (loss) per share before cumulative effect of changes in accounting principle(8):
Basic		(2.35	)		(4.79	)		(10.44	)		(9.99	)		7.39			9.05			7.22
Diluted		(2.35	)		(4.79	)		(10.44	)		(9.99	)		7.05			8.52			6.87
Earnings (loss) per share(8):
Basic		(2.35	)		(4.79	)		(10.44	)		(9.99	)		6.58			8.66			7.22
Diluted		(2.35	)		(4.79	)		(10.44	)		(9.99	)		6.28			8.15			6.87
Other Data:
Ratio of earnings (loss) to fixed charges(9)		0.44	x		(0.40	x)		(0.51	x)		(0.51	x)		2.37	x		3.55	x		3.45	x
Operating Statistics:
Revenue passengers enplaned (thousands)		50,879			52,045			107,048			104,943			119,930			110,083			105,304
Available seat miles (millions)(10)		65,238			69,599			141,719			147,837			154,974			147,073			142,154
Revenue passenger miles (millions)(11)		46,958			49,549			102,029			101,717			112,998			106,165			103,342
Operating revenue per available seat mile		9.90	¢		9.45	¢		9.39	¢		9.39	¢		10.80	¢		10.12	¢		10.07	¢
Passenger mile yield(12)		12.73	¢		12.30	¢		12.08	¢		12.74	¢		13.86	¢		13.14	¢		12.99	¢
Operating cost per available seat mile		10.42	¢		10.26	¢		10.31	¢		10.47	¢		9.75	¢		9.22	¢		8.80	¢
Passenger load factor(13)		71.98	%		71.19	%		71.99	%		68.80	%		72.91	%		72.18	%		72.70	%
Breakeven passenger load factor(14)		76.06	%		77.76	%		79.64	%		77.31	%		65.29	%		65.37	%		62.94	%

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	As of June 30,		As of December 31,
	2003		2002		2001		2000		1999		1998(15)
	(unaudited)										(unaudited)
Balance Sheet Data (in millions):
Cash and cash equivalents	$	2,815	$	1,969	$	2,210	$	1,364	$	1,623	$	618
Total assets		25,557		24,720		23,605		21,931		19,942		14,727
Current liabilities		6,373		6,455		6,403		5,245		5,514		4,456
Long-term debt (less current maturities)(16)		11,343		10,074		8,279		5,797		4,144		1,524
Obligations under capital leases (less current obligations)		83		100		68		99		159		196
Shareowners’ equity		679		893		3,769		5,343		4,908		4,077

(1) Includes a $43 million pretax charge for the cost of pension and postretirement obligations for participants in Delta’s 2002 workforce reduction programs; a $398 million pretax reduction of operating expenses for passenger and air carrier security fee reimbursements received from the U.S. government under the Emergency Wartime Supplemental Appropriations Act (the “Appropriations Act”); a $279 million pretax gain from the sale of Delta’s equity investment in Worldspan, L.P.; and a $29 million pretax charge for other income and expense items.

(2) Includes a $63 million pretax expense for the temporary carrying costs associated with surplus pilots and grounded aircraft resulting from capacity reductions implemented in November 2001, as well as related requalification training and relocation costs for certain pilots; and a $43 million pretax charge for fair value adjustments of SFAS 133 derivatives.

(3) Includes a $439 million pretax charge for asset writedowns, restructuring and related items primarily associated with changes to Delta’s fleet plan and its 2002 workforce reduction programs; a $34 million pretax gain for compensation received under the Air Transportation Safety and System Stabilization Act (the “Stabilization Act”); and a $94 million net pretax charge for other income and expense items.

(4) Includes a $1.1 billion pretax charge for asset writedowns, restructuring and related items primarily associated with the effects of the September 11, 2001 terrorist attacks on our business; a $634 million pretax gain from Stabilization Act compensation; and a $186 million net pretax gain for other income and expense items.

(5) Includes a $108 million pretax charge for restructuring and related items primarily associated with Delta’s early retirement medical option program offered in 2000; a $151 million net pretax gain from other income and expense items; and a $164 million cumulative effect, non-cash pretax charge, resulting from our adoption of SFAS 133 on July 1, 2000.

(6) Includes a $469 million pretax charge for asset writedowns; an $887 million net pretax gain from other income and expense items; and an $89 million non-cash pretax charge from the cumulative effect of a change in accounting principle resulting from our adoption of SAB 101 on January 1, 1999.

(7) Includes interest income.

(8) All earnings per share amounts for 1998 have been restated to reflect the two-for-one common stock split that became effective on November 2, 1998.

(9) The ratio of earnings (loss) to fixed charges represents the number of times that fixed charges are covered by earnings. Earnings (loss) represents income (loss) before income taxes, excluding the cumulative effect of a change in accounting principle, plus fixed charges and distributed income of equity investees less capitalized interest and income (loss) from equity investees. Fixed charges include interest, whether expensed or capitalized; one-half of rental expense, which Delta believes is representative of the interest factor in those periods; amortization of debt costs; and preferred security dividends. Fixed charges exceeded adjusted earnings (loss) by $2.0 billion and $1.8 billion for the years ended December 31, 2002 and 2001, respectively, and $403 million and $928 million for the six months ended June 30, 2003 and 2002, respectively.

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(10) “Available seat miles” is a measure of capacity which is calculated by multiplying the total number of seats available for transporting passengers by the total number of miles flown during a reporting period.

(11) “Revenue passenger mile” represents one revenue-paying passenger transported one mile and is calculated by multiplying the number of revenue passengers by the number of miles they are flown during the period.

(12) “Passenger mile yield” represents the amount of passenger revenue earned per revenue passenger mile during a reporting period.

(13) “Passenger load factor” is a measure of utilized available seating capacity which is calculated by dividing revenue passenger miles by available seat miles for a reporting period.

(14) “Breakeven passenger load factor” represents the percentage of seats that must be occupied in order to break even on a pretax income basis.

(15) Effective December 31, 2000, Delta changed its fiscal year end from June 30 to December 31 and reported audited balance sheet data for December 31, 2000 and December 31, 1999. Balance sheet data as of December 31, 1998 was not required to be audited.

(16) Long-term debt includes $498 million in Special Facilities Revenue Bonds issued in August 2001 by the Massachusetts Port Authority for the redevelopment and expansion of Delta’s facilities in Terminal A at Boston’s Logan International Airport. Delta has guaranteed the payment of debt service on these bonds. The related proceeds of the bonds may only be used for the redevelopment and expansion of Delta’s facilities at Logan International Airport, and, accordingly, are reflected on Delta’s consolidated balance sheets at June 30, 2003, December 31, 2002 and December 31, 2001 as a restricted investment in “other assets,” as required by accounting principles generally accepted in the United States of America.

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RISK FACTORS

Before investing in our notes or common stock, you should carefully consider the following risk factors as well as other information contained or incorporated by reference in this prospectus.

Risk Factors Relating to Business Environment

The terrorist attacks in 2001, military action in Iraq and other world events adversely affected, and may continue to adversely affect, Delta’s financial results

Delta and the airline industry have faced the worst financial crisis in aviation history. Since the terrorist attacks of September 11, 2001, involving commercial aircraft of other airlines, the airline industry has experienced substantial revenue decline and cost increases which have resulted in industry wide liquidity issues. Additionally, during 2003, the industry’s financial results were negatively impacted by the military action in Iraq and the Severe Acute Respiratory Syndrome (“SARS”) outbreak.

The future impact of the events of September 11, 2001 and the ability of Delta to weather the current financial crisis will depend on a number of factors, including, but not limited to, the following: (i) general economic conditions; (ii) the adverse impact of the terrorist attacks on the demand for air travel; (iii) the change in Delta’s operations and higher costs resulting from, and customer reaction to, new airline and airport security directives; (iv) the availability and cost of war and terrorism risk and other insurance for Delta; (v) the credit downgrades of Delta and other airlines by Moody’s and Standard & Poor’s discussed below, and the possibility of additional downgrades, to the extent it makes it more difficult and/or more costly for Delta to obtain financing; (vi) potential declines in the values of the aircraft in Delta’s fleet or facilities and any related asset impairment charges; (vii) additional terrorist activity and/or war; (viii) our future funding obligations under our defined benefit pension plans, which are based on various factors, including actual market performance of our pension plan assets, future 30-year U.S. Treasury bond yields and regulatory requirements; (ix) the results of the profit improvement initiatives previously announced by Delta; (x) actions by U.S. or foreign governments, including the Federal Aviation Administration (the “FAA”) and other regulatory agencies; and (xi) the outcome of Delta’s litigation.

The credit ratings of Delta have been downgraded since 2001

After September 11, 2001, the credit ratings on Delta’s senior unsecured long-term debt were lowered from Baa3 to Ba2 by Moody’s and Delta’s issuer credit rating was lowered from BBB- to BB+ by Standard & Poor’s, with concurrent downgrades of senior unsecured and various other debt by both rating agencies. In November 2001, Standard & Poor’s lowered Delta’s senior unsecured debt rating (but no other ratings) from BB+ to BB and in June 2002, Standard & Poor’s lowered Delta’s issuer credit rating from BB+ to BB, with concurrent downgrades of senior unsecured and various other Delta debt ratings. Moody’s downgraded Delta’s senior unsecured long-term debt rating from Ba2 to Ba3 in December 2001 with concurrent downgrades of various other Delta debt ratings.

On March 28, 2003, Standard & Poor’s lowered Delta’s issuer credit rating from BB to BB-, and Delta’s senior unsecured long-term debt relating from BB- to B. On April 10, 2003, Moody’s downgraded Delta’s senior implied debt rating from Ba3 to B1, and Delta’s senior unsecured long-term debt rating from Ba3 to B3. On July 8, 2003, Standard & Poor’s affirmed Delta’s BB- issuer credit rating and removed its ratings from CreditWatch.

The credit ratings of certain other airlines have been adjusted by Moody’s and Standard and Poor’s in the various aforementioned reviews and in other independent ratings actions. Moody’s outlook on Delta’s debt securities is negative and Standard & Poor’s outlook on Delta’s issuer credit rating remains negative. There can be no assurance that Delta’s long-term debt rating will not be lowered further or withdrawn by a rating agency.

Delta’s current credit ratings have negatively impacted its ability to (i) issue unsecured debt, (ii) renew outstanding letters of credit that back certain of our obligations and (iii) obtain certain financial instruments that we use in our fuel hedging program. Our current credit ratings have also increased the cost of our financing transactions and the amount of collateral required for certain financial instruments and insurance coverage.

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Our insurance costs have increased substantially as a result of the September 11, 2001 terrorist attacks and further increases in insurance costs or reductions in coverage could have a material adverse impact on Delta

As a result of the terrorist attacks of September 11, 2001, aviation insurers have significantly reduced the maximum amount of insurance coverage available to commercial air carriers for liability to persons other than employees or passengers for claims resulting from acts of terrorism, war, or similar events. At the same time, they significantly increased the premiums for such coverage and for aviation insurance in general. Pursuant to authority granted in the Stabilization Act, the U.S. government has supplemented Delta’s commercial war-risk insurance with a comprehensive war-risk liability policy to cover losses to passengers, third parties (ground damage) and the aircraft hull. This coverage is in effect through August 2004. Delta expects that if the commercial insurance carriers reduce further the amount of insurance coverage available to Delta or further significantly increase the cost of aviation insurance, or if the U.S. government fails to renew the war-risk insurance that it provides, Delta’s business, financial position, and results of operations could be materially adversely affected.

Risk Factors Relating to Delta

Delta continues to experience significant operating losses

Delta reported a net loss of $282 million for the six months ended June 30, 2003, or $2.35 diluted loss per common share, compared to a net loss of $583 million for the six months ended June 30, 2002, or $4.79 diluted loss per common share. This includes the $398 million of payments that we received from the U.S. government under the Appropriations Act and a $279 million pretax gain from the sale of Delta’s equity investment in Worldspan, L.P. For the fiscal year ended December 31, 2002, Delta reported a net loss of $1.3 billion, or $10.44 diluted loss per common share, compared to a net loss of $1.2 billion, or $9.99 diluted loss per common share, for the fiscal year ended December 31, 2001.

Delta’s operating revenues totaled $6.5 billion for the six months ended June 30, 2003, a 2% decrease compared to the depressed level recorded for the six months ended June 30, 2002. Passenger revenues decreased 2% to $6.0 billion. Revenue passenger miles decreased 5% on a capacity decline of 6%, while passenger mile yield increased 3%. The 2% decline in passenger revenues for the six months ended June 30, 2003 was primarily due to the substantial adverse impact of the military action in Iraq and the difficult revenue environment. The 3% increase in passenger mile yield reflects improved yields in international markets. Operating expenses for the six months ended June 30, 2003 totaled $6.8 billion, a 5% decrease from $7.1 billion for the six months ended June 30, 2002. Operating capacity declined 6%, while cost per available seat mile increased 1.6% to 10.42¢. The changes in operating expenses and cost per available seat mile reflect Delta’s receipt of $398 million under the Appropriations Act, which was recorded as an offset to operating expenses, and lower capacity.

Delta estimates that its net loss for the September 2003 quarter will be approximately $200 million to $250 million. Delta does not expect significant improvement in the revenue environment through 2003 and also expects significant cost pressures related to pension and interest expenses to continue. As a result, Delta expects to report a net loss for the year ending December 31, 2003.

Significant changes or extended periods of high fuel costs would materially affect Delta’s operating results

Delta’s results of operations can be significantly impacted by changes in the price and availability of jet fuel. Changes in jet fuel prices and availability have industry-wide impact. Accordingly, lower jet fuel prices may be offset by increased price competition and lower revenues for all air carriers. Moreover, there can be no assurance that Delta will be able to increase its fares in response to any future increases in fuel prices.

Delta’s jet fuel purchase contracts do not provide material protection against price increases or for assured availability of supplies. Delta purchases most of its jet fuel from petroleum refiners under contracts which establish the price based on various market indices. Delta also purchases aircraft fuel on the spot market, from off-shore sources and under contracts which permit the refiners to set the price and give Delta the right to terminate upon short notice if the price is unacceptable.

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Although Delta is currently able to obtain adequate supplies of jet fuel, it is impossible to predict the future availability or price of jet fuel. Political disruptions or war involving oil producing countries, changes in government policy concerning aircraft fuel production, transportation or marketing, changes in aircraft fuel production capacity, environmental concerns and other unpredictable events may result in fuel supply shortages and fuel price increases in the future.

Employee strikes and other labor-related disruptions may adversely affect Delta’s operations

Delta’s business is labor intensive, requiring large numbers of pilots, flight attendants, mechanics and other personnel. Strikes or labor disputes with unionized employees of Delta or Delta’s affiliates may adversely affect Delta’s ability to conduct its business. As of June 30, 2003, Delta and Delta’s wholly-owned subsidiaries had a total of 69,800 full-time equivalent employees. Approximately 18% of these employees are represented by unions. Relations between air carriers and labor unions in the U.S. are governed by the Railway Labor Act, which provides that a collective bargaining agreement between an airline and a labor union does not expire, but instead becomes amendable as of a stated date. Delta’s wholly-owned subsidiary, Atlantic Southeast Airlines, Inc. (“ASA”), is in collective bargaining negotiations with the Air Line Pilots Association, International (“ALPA”), which represents ASA’s approximately 1,500 pilots. The outcome of these collective bargaining negotiations cannot presently be determined. In addition to the current ASA-ALPA negotiations, if Delta or Delta’s affiliates are unable to reach agreement with any of their unionized work groups on future negotiations regarding the terms of their collective bargaining agreements, Delta may be subject to work interruptions or stoppages. Work stoppages may adversely affect Delta’s ability to conduct its operations. See “Recent Developments — Profit Improvement Initiatives” for more information regarding Delta’s recent discussions with ALPA.

U.S. federal law imposes limitations on foreign ownership of U.S. airlines and voting by non-U.S. citizens

U.S. federal law on foreign ownership of U.S. airlines requires that no more than 25% of Delta’s capital stock be voted, directly or indirectly, by persons who are not U.S. citizens, and that Delta’s president and at least two-thirds of the members of Delta’s board of directors be U.S. citizens. As such, Delta will not register any shares of its capital stock on its stock register if the amount so registered would exceed the foreign ownership restrictions imposed by federal law. Accordingly, if and for so long as the combined foreign ownership holdings of Delta’s capital stock reaches the 25% threshold imposed by federal law, no other non-U.S. citizen will be able to register its shares of common stock on Delta’s stock register and vote its shares.

We expect that we will need to raise significant additional financing

In the aftermath of the events of September 11, 2001, Delta raised substantial amounts of funding to finance capital commitments and day-to-day operations. Delta expects that it will need to raise significant additional financing in the future to cover its liquidity needs. To the extent Delta may be unable to access the capital markets for long-term capital spending requirements or short-term liquidity needs, or Delta’s financing costs continue to increase, including as a result of further credit rating downgrades, Delta’s business, financial position and results of operations would be materially adversely impacted.

Our indebtedness and other obligations are substantial and could affect our business

We have now and will continue to have a significant amount of indebtedness. As of June 30, 2003, we had approximately $12.2 billion of total consolidated indebtedness. Further, the indenture does not limit the creation of additional indebtedness. Our substantial indebtedness could have important consequences. For example, it could:

• limit our ability to obtain additional financing for working capital, capital expenditures, acquisitions and general corporate purposes;

• require us to dedicate a substantial portion of our cash flow from operations to payments on our indebtedness, thereby reducing the funds available to us for other purposes;

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• make us more vulnerable to economic downturns, limiting our ability to withstand competitive pressures and reducing our flexibility in responding to changing business and economic conditions; and

• limit our flexibility in planning for, or reacting to, changes in our business and the industry in which we operate.

Holders of notes are not afforded protection in the event of a highly leveraged transaction, except to the extent described below under “Description of Notes—Repurchase at Option of Holders Upon a Designated Event.” Any of the foregoing could adversely affect our business and our ability to service our debt, including the notes.

Our pension plan funding obligations are significant

Delta sponsors defined benefit pension plans (“pension plans”) for eligible employees and retirees. We have satisfied our minimum required funding obligations for our pension plans in 2003. Estimates of our future funding obligations under these pension plans are based on various assumptions, including the actual market performance of the plan assets, future 30-year U.S. Treasury bond yields and regulatory requirements. As previously announced, our estimated pension plan funding obligation in 2004 is between $350 million and $450 million. Our funding obligations under the pension plans in later years are not reasonably estimable at this time because these estimates vary materially depending on the assumptions used. Nevertheless, we presently expect our funding obligations under our pension plans in each of the years from 2005 through 2007 will be substantially larger than our estimated funding obligations in 2004. For additional information regarding our pension plans, see Note 11 (pages 51 – 55) of the Notes to the Consolidated Financial Statements in our 2002 Annual Report to Shareowners, which is incorporated by reference in this prospectus.

Risk Factors Relating to the Airline Industry

The airline industry is highly competitive

Delta faces significant competition with respect to domestic and international routes, services and fares. All domestic routes served by Delta are subject to competition from both new and established carriers, some of which have substantially lower costs than Delta and service virtually all of Delta’s domestic routes. On most domestic and international routes, Delta competes with at least one, and usually more than one, scheduled passenger airline. Delta also competes with all-cargo carriers, charter airlines and, particularly on its shorter routes, with surface transportation.

International marketing alliances formed by domestic and foreign carriers, such as the Star Alliance (among United Airlines, Lufthansa German Airlines and others), the Oneworld Alliance (among American Airlines, British Airways and others) and the Wings Alliance (between Northwest Airlines and KLM-Royal Dutch Airlines), have significantly increased competition in international markets. Through marketing and codesharing arrangements with U.S. carriers, foreign carriers have obtained access to interior U.S. routes. Similarly, U.S. carriers have increased their ability to sell international transportation such as transatlantic services to and beyond European cities.

The airline industry is characterized by substantial price competition. If price reductions are not offset by increases in traffic or changes in the mix of traffic that improve Delta’s passenger mile yield, Delta’s operating results will be adversely affected.

The airline industry is subject to extensive government regulation

Airlines are subject to extensive regulatory and legal compliance requirements that result in significant costs. The Federal Aviation Administration (“FAA”) from time to time issues directives and other regulations relating to the maintenance and operation of aircraft that require significant expenditures. Some FAA requirements cover, among other things, security measures, collision avoidance systems, airborne windshear avoidance systems, noise abatement and other environmental concerns, commuter aircraft safety and increased

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inspections and maintenance procedures to be conducted on older aircraft. Delta expects to continue incurring expenses to comply with the FAA’s regulations.

Additional laws, regulations, taxes and airport rates and charges have been proposed from time to time that could significantly increase the cost of airline operations or reduce revenues. For example, the Aviation and Transportation Security Act, which became law in November 2001, mandates the federalization of certain airport security procedures and imposes additional security requirements on airports and airlines, most of which are funded by a new per-ticket tax on passengers and a new tax on airlines. Subsequently, on April 16, 2003, President Bush signed into law the Appropriations Act which provides, among other things, for certain payments to the airline industry and the suspension of these taxes from July 1, 2003 to September 30, 2003. The ability of U.S. carriers to operate international routes is subject to change because the applicable arrangements between the United States and foreign governments may be amended from time to time, or because appropriate slots or facilities are not made available. Delta cannot provide assurance that laws or regulations enacted in the future will not adversely affect it.

Seasonality and other factors impact demand for air travel

In general, demand for air travel is higher in the June and September quarters, particularly in international markets, because there is more vacation travel during these periods than during the remainder of the year. Demand for air travel is also affected by factors such as economic conditions, war or the threat of war, fare levels and weather conditions. In addition, demand for air travel at particular airlines may be impacted from time to time by, among other things, actual or threatened disruptions to operations due to labor issues. Due to these and other factors, operating results for an interim period are not necessarily indicative of operating results for an entire year, and operating results for a historical period are not necessarily indicative of operating results for a future period.

The airline industry has suffered significant losses; airline bankruptcies and other restructuring efforts could adversely affect the industry

The airline industry as a whole suffered significant losses in 2001 and 2002 and is expected to suffer significant losses for all of 2003. Many airlines, in addition to Delta, have announced reductions in capacity, service and workforce in response to the industry-wide reductions in passenger demand and yields. In addition, since September 11, 2001, several air carriers have sought to reorganize under Chapter 11 of the Bankruptcy Code, including US Airways, Inc., the seventh largest U.S. air carrier, and UAL Corporation (United Airlines), the second largest U.S. air carrier. Since filing for Chapter 11 on August 11, 2002, US Airways has emerged from bankruptcy. Additionally, AMR Corporation (American Airlines) has recently announced that it restructured certain labor costs and lowered its operating cost base. Successful completion of such reorganizations or restructurings could present Delta with competitors that have significantly lower operating costs derived from renegotiated labor, supply, and financing contracts. Historically, air carriers involved in reorganizations have undertaken substantial fare discounting in order to maintain cash flows and to enhance continued customer loyalty. Such fare discounting could further lower yields for all carriers, including Delta. In addition, the market value of aircraft would likely be negatively impacted if a number of air carriers, including US Airways and United Airlines, seek to further reduce capacity by eliminating aircraft from their fleets. The bankruptcies of these airlines and the possibility of bankruptcy for other airlines could make it more difficult and/or more costly for Delta to obtain financing.

The airline industry has been significantly impacted by the SARS outbreak

During the first six months of 2003, the SARS outbreak, primarily centered in China and other Southeast Asian countries, with a number of cases in Toronto, Canada, also significantly impacted airline industry revenues. Due to our small Pacific presence, however, the SARS outbreak had only a minimal impact on our revenues for the six months ended June 30, 2003. We are not able to estimate the impact SARS may have on our future revenues due to uncertainty related to the spread of this outbreak.

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Other Risk Factor

Arthur Andersen LLP audited certain financial information included or incorporated in this prospectus. In the event such financial information is later determined to contain false statements, you may be unable to recover damages from Arthur Andersen LLP

Our consolidated balance sheet as of December 31, 2001 and the related statements of operations, shareholders’ equity and cash flows for the fiscal years ended December 31, 2001 and 2000 were audited by Arthur Andersen LLP. Arthur Andersen LLP has ceased operations in the United States. As a result, you may be limited in your ability to recover damages from Arthur Andersen LLP under the Securities Act if it is later determined that there are false statements contained in any portions of this prospectus that have been prepared in reliance on financial statements audited by Arthur Andersen LLP.

Risk Factors Relating to the Offering

The notes will rank below our secured debt and the liabilities of our subsidiaries

The notes will be our senior unsecured obligations and will rank equal in right of payment to all of our other existing and future senior unsecured indebtedness. The notes will be effectively subordinated to all of our existing and future secured indebtedness to the extent of the assets securing that indebtedness. The notes will also be structurally subordinated to all liabilities of our subsidiaries.

A substantial portion of our debt is secured by our assets. As a result, holders of our secured debt will have a claim to those assets prior to any claim that you may have to those assets. Further, the indenture does not limit our ability to create additional indebtedness or to secure any such indebtedness with additional assets. If we incur additional indebtedness and secure such indebtedness with our assets, your rights to receive payments under the notes will effectively be junior to the rights of the holders of such future secured indebtedness.

The notes are obligations exclusively of Delta. Our subsidiaries are separate and distinct legal entities, and have no obligation to pay any amounts due on the notes or to provide us with funds for its payment obligations. Our right to receive any assets of any of our subsidiaries, as an equity holder of such subsidiaries, upon their liquidation or reorganization, and therefore the right of the holders of the notes to participate in those assets, are expressly subordinated to the claims of that subsidiary’s creditors. The notes do not restrict the ability of our subsidiaries to incur additional indebtedness. Further, if we fail to deliver our common stock upon conversion of a note and thereafter become the subject of bankruptcy proceedings, a holder’s claim for damages arising from such failure could be subordinated to all of our existing and future obligations and those of our subsidiaries.

As of June 30, 2003, we had approximately $12.2 billion of total consolidated indebtedness; $5.9 billion of secured indebtedness (excluding secured indebtedness of our subsidiaries); and approximately $1.8 billion of subsidiary indebtedness.

We may be unable to repay or repurchase the notes

At maturity, the entire outstanding principal amount of the notes will become due and payable by us. In addition, holders of the notes will have the right to require us to repurchase all or a portion of their notes for cash on June 3, 2008, June 3, 2013 and June 3, 2018 or if a “designated event,” as defined in the indenture, occurs. If a purchase date or a designated event occurs at a time when we are prohibited from purchasing or redeeming notes, we could seek the consent of our lenders to redeem the notes or attempt to refinance the notes. We cannot assure you that we will have sufficient funds or will be able to obtain any required consents or arrange for additional financing to pay the principal amount at maturity or repurchase price when due. Our failure to repay the notes at maturity or to repurchase any tendered notes upon a designated event would constitute an event of default under the indenture. Any such default, in turn, may cause a default under the terms of our other debt. In such event, holders of the notes would rank equal in right of payment to holders of our other senior unsecured debt.

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There is no public market for the notes, and we cannot assure you that a market for the notes will develop

The notes are currently eligible for trading on the PORTAL Market. However, notes sold using this prospectus will no longer be eligible for trading in the PORTAL Market. In addition, there is no established public trading market for the notes, and no assurance can be given as to:

• the liquidity of any such market that may develop;

• the ability of holders of the notes to sell their notes; or

• the price at which the holders of the notes would be able to sell their notes.

If such a market were to exist, the notes could trade at prices that may be higher or lower than their principal amount or purchase price, depending on many factors, including:

• prevailing interest rates and the markets for similar securities;

• the market price of our common stock;

• general economic conditions; and

• our financial condition, historic financial performance and future prospects.

We expect that the trading value of the notes will be significantly affected by the price of our common stock

The market price of the notes is expected to be significantly affected by the market price of our common stock. This may result in greater volatility in the trading value of the notes than would be expected for nonconvertible debt securities we issue.

Changes in our credit rating or the credit markets could adversely affect the price of the notes

The price for the notes depends on many factors, including:

• our credit rating with major credit rating agencies;

• the prevailing interest rates being paid by other companies similar to us;

• the market price of our common stock;

• our financial condition, financial performance and future prospects; and

• the overall condition of the financial markets.

The condition of the credit markets and prevailing interest rates have fluctuated in the past and are likely to fluctuate in the future. Such fluctuations could have an adverse effect on the price of the notes.

In addition, credit rating agencies continually revise their ratings for the companies that they follow, including us. The credit rating agencies also evaluate the airline industry as a whole and may change their credit rating for us based on their overall view of our industry. We cannot be sure that credit rating agencies will maintain their credit ratings on the notes. A negative change in our rating could have an adverse effect on the price of the notes.

Certain transactions may affect the value of the notes

We intend to continue our practice of acquiring our common stock to satisfy our obligations under various employee benefit plans and for other corporate purposes. Therefore, we expect to acquire shares of our common stock and enter into other transactions related to our common stock during the term of the notes. Depending on, among other things, future market conditions, the aggregate amount of any such acquisitions are likely to vary over time.

The effect, if any, of any of these transactions and activities on the market price of our common stock or the notes will depend in part upon market conditions and cannot be ascertained at this time. Any of these activities could materially affect the value of our common stock and the value of the notes.

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THE COMPANY

Delta is a major air carrier that provides air transportation for passengers and freight throughout the United States and around the world. Based on the most currently available data, Delta is the second largest carrier in terms of passengers carried and the third largest as measured by operating revenues and revenue passenger miles flown. Delta is the leading U.S. transatlantic airline offering the most daily flight departures, servicing the largest number of nonstop routes and carrying more passengers than any other U.S. airline. We operate hubs at Atlanta, Cincinnati, Dallas/Fort Worth and Salt Lake City. We also operate international gateways in Atlanta and at New York’s John F. Kennedy International Airport.

Delta is a Delaware corporation headquartered in Atlanta, Georgia. Our address is Hartsfield Atlanta International Airport, Atlanta, Georgia 30320, and the telephone number is (404) 715-2600. Our website is www.delta.com. The information contained in our website is not a part of this offering prospectus.

RECENT DEVELOPMENTS

Results for the Six Months Ended June 30, 2003

Delta reported a net loss of $282 million for the six months ended June 30, 2003, or $2.35 diluted loss per common share, compared to a net loss of $583 million for the six months ended June 30, 2002, or $4.79 diluted loss per common share. This includes the $398 million of payments that we received from the U.S. government under the Appropriations Act and a $279 million pretax gain from the sale of Delta’s equity investment in Worldspan, L.P. For the fiscal year ended December 31, 2002, Delta reported a net loss of $1.3 billion, or $10.44 diluted loss per common share, compared to a net loss of $1.2 billion, or $9.99 diluted loss per common share, for the fiscal year ended December 31, 2001.

Delta’s operating revenues totaled $6.5 billion for the six months ended June 30, 2003, a 2% decrease compared to the depressed level recorded for the six months ended June 30, 2002. Passenger revenues decreased 2% to $6.0 billion. Revenue passenger miles decreased 5% on a capacity decline of 6%, while passenger mile yield increased 3%. The 2% decline in passenger revenues for the six months ended June 30, 2003 was primarily due to the substantial adverse impact of the military action in Iraq and the difficult revenue environment. The 3% increase in passenger mile yield reflects improved yields in international markets. Operating expenses for the six months ended June 30, 2003 totaled $6.8 billion, a 5% decrease from $7.1 billion for the six months ended June 30, 2002. Operating capacity declined 6%, while cost per available seat mile increased 1.6% to 10.42¢. The changes in operating expenses and cost per available seat mile reflect Delta’s receipt of $398 million under the Appropriations Act, which was recorded as an offset to operating expenses, and lower capacity.

Delta estimates that its net loss for the September 2003 quarter will be approximately $200 million to $250 million. Delta does not expect significant improvement in the revenue environment through 2003 and also expects significant cost pressures related to increases in pension and interest expenses to continue. As a result, Delta expects to report a net loss for the year ending December 31, 2003.

Profit Improvement Initiatives

We believe it is essential for us to reduce our costs to compete in this business environment. Accordingly, during the first half of 2003, we continued to develop and implement initiatives to achieve our goal of reducing non-fuel unit costs by 15% by the end of 2005. In addition, we recently presented a proposal to the Air Line Pilots Association, International (“ALPA”), which represents Delta’s pilots, to move towards a competitive pilot cost structure. On July 23, 2003, ALPA announced that Delta’s current approach to negotiations aimed at reducing pilot employment costs does not furnish a basis for agreement. As a result, no further negotiations are scheduled at this time. Delta remains hopeful that we and ALPA can find common ground for renewed negotiations soon. The existing collective bargaining agreement becomes amendable on May 1, 2005.

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Stock Option Exchange Program

On June 30, 2003, Delta announced that it had completed an employee stock option exchange program, which expired on June 25, 2003. Delta canceled options to purchase approximately 31.6 million shares of its common stock and expects to issue new options to purchase approximately 12.1 million shares of common stock in exchange. Approximately 80% of the eligible options were exchanged under the program. Under the terms of the offer, Delta expects to grant replacement stock options on December 26, 2003.

Discontinuation of Common Stock Cash Dividends

On July 24, 2003, Delta’s Board of Directors announced that it would immediately discontinue the payment of quarterly common stock cash dividends. The Board of Directors has made no decision at this time regarding the semi-annual dividend payments on Delta’s Series B ESOP Convertible Preferred Stock.

Debt Exchange Offer

On July 25, 2003, Delta commenced a voluntary exchange offer for $300 million outstanding principal amount of its 6.65% Series C Medium-Term Notes due 2004, and $500 million outstanding principal amount of its 7.70% Senior Notes due 2005. The new Senior Notes to be issued will accrue interest at 10% per annum and will mature August 15, 2008. The exchange offer will expire on August 27, 2003, unless extended.

USE OF PROCEEDS

We will not receive any of the proceeds from the sale of the notes or the common stock issuable upon conversion of the notes by any selling securityholder. We used the net proceeds from the initial issuance of the securities for general corporate purposes.

COMMON STOCK AND DIVIDEND DATA

Our common stock is listed on the New York Stock Exchange under the symbol “DAL.” The following table sets forth, for the periods indicated, the highest and lowest sale prices for our common stock, as reported on the New York Stock Exchange.

	High		Low
Fiscal 2001
First Quarter	$	52.94	$	37.51
Second Quarter		48.05		37.80
Third Quarter		46.56		20.00
Fourth Quarter		31.15		22.20
Fiscal 2002
First Quarter	$	38.69	$	28.52
Second Quarter		32.65		18.30
Third Quarter		20.12		8.30
Fourth Quarter		14.09		6.10
Fiscal 2003
First Quarter	$	14.00	$	6.56
Second Quarter		16.05		8.76
Third Quarter (through August 21, 2003)		15.08		10.26

As of June 30, 2003, there were approximately 22,368 holders of record of our common stock. On August 21, 2003, the last reported sale price of our common stock on the New York Stock Exchange was $12.41.

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We paid a regular quarterly cash dividend of $0.025 per share of common stock for each quarter of fiscal years 2001 and 2002, and the first two quarters of 2003. On July 24, 2003, Delta’s Board of Directors announced that it would immediately discontinue the payment of quarterly common stock cash dividends. The Board of Directors has made no decision at this time regarding the semi-annual dividend payments on Delta’s Series B ESOP Convertible Preferred Stock. Our dividend policy is reviewed from time to time by the Board of Directors. Future common stock dividend decisions will take into account the then current business results, cash requirements and financial condition of Delta. Our debt agreements do not restrict the payment of cash dividends.

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DESCRIPTION OF NOTES

We issued the notes under an indenture dated June 2, 2003, between us and The Bank of New York Trust Company of Florida, N.A., as trustee. A copy of the indenture and the registration rights agreement entered into with the initial purchaser is available upon request to us at the address indicated under “Additional Information.” The following is a summary of certain provisions of the indenture and the registration rights agreement and does not purport to be complete. Reference should be made to all provisions of the indenture and the registration rights agreement, including the definitions of certain terms contained therein. As used in this section, the terms “Delta,” “we,” “us” and “our” refer to Delta Air Lines, Inc., but not any of our subsidiaries, unless the context requires otherwise.

General

The notes are our senior unsecured obligations and rank equal in right of payment to all of our other existing and future senior unsecured indebtedness. The notes are effectively subordinated to all of our existing and future secured indebtedness to the extent of the assets securing that indebtedness, and are structurally subordinated to all liabilities of our subsidiary.

The notes will mature on June 3, 2023, and are limited to an aggregate principal amount of $350 million.

The notes were initially offered at a price to investors of $1,000 per note. You have the option, subject to fulfillment of certain conditions and during the periods described below, to convert your notes into shares of our common stock initially at a conversion price of $28.00 per share of common stock, subject to adjustments as described below. This is equivalent to a conversion rate of approximately 35.7143 shares of common stock per $1,000 principal amount of notes based on the issue price of the notes. Upon conversion of a note, you will receive only shares of our common stock and a cash payment to account for fractional shares.

The notes were issued in denominations of $1,000 and integral multiples of $1,000 in fully registered form. The notes are exchangeable and transfers of the notes will be registrable without charge, but we may require payment of a sum sufficient to cover any tax or other governmental charge in connection with such exchanges or transfers.

The notes accrue interest at a rate of 8.00% per annum from June 2, 2003, or from the most recent interest payment date to which interest has been paid or duly provided for, and any accrued and unpaid interest and liquidated damages, will be payable semi-annually in arrears on June 3 and December 3 of each year, beginning December 3, 2003. Interest will be paid to the person in whose name a note is registered at the close of business on the May 19 or November 19 (any of which we refer to as a “record date”) immediately preceding the relevant interest payment date. However, in the case of a note redeemed by us at our option or repurchased in connection with a designated event (as defined below), during the period from the applicable record date to, but excluding, the next succeeding interest payment date, accrued interest will be payable to the holder of the note redeemed or repurchased. Interest will be computed on the basis of a 360-day year comprised of twelve 30-day months.

We are not subject to any financial covenants under the indenture. In addition, we are not restricted under the indenture from paying dividends, incurring debt, securing our debt or issuing or repurchasing our securities.

You are not afforded protection in the event of a highly leveraged transaction, or a change of control of us under the indenture, except to the extent described below under the caption “Repurchase at Option of Holders Upon a Designated Event.”

Principal, interest and liquidated damages, if any, on the notes will be payable in same-day funds by transfer to an account maintained by the payee at the office or agency maintained for such purpose or, if no proper wire transfer instructions shall have been received by the trustee, payment of interest may be made by check mailed to

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the holders of the notes at their respective addresses set forth in the register of holders of notes. Until otherwise designated by us, the office or agency maintained for such purpose will be the principal corporate trust office of the trustee.

If any interest payment date, maturity date, purchase date or designated event repurchase date falls on a day that is not a business day, the required payment of principal, interest and liquidated damages, if any, will be made on the next succeeding business day as if made on the date that the payment was due and no interest will accrue on that payment for the period from and after the interest payment date, maturity date, purchase date or designated event repurchase date, as the case may be, to the date of payment on the next succeeding business day. The term “business day” means, with respect to any note, any day other than a Saturday, a Sunday or a day on which banking institutions in The City of New York are authorized or required by law, regulation or executive order to close.

The notes are currently eligible for trading in the PORTAL Market. However, notes sold using this Prospectus will no longer be eligible for trading in the PORTAL Market.

Conversion Rights

Subject to the conditions and during the periods described below, holders may convert all or some of their notes into shares of our common stock initially at a conversion price of $28.00 per share of common stock. This is equivalent to a conversion rate of approximately 35.7143 shares of common stock per $1,000 principal amount of notes. The conversion rate and the equivalent conversion price in effect at any given time will be subject to adjustment as described below. A note for which a holder has delivered a purchase notice or a notice requiring us to redeem such note upon a designated event may be surrendered for conversion only if such notice is withdrawn in accordance with the indenture.

Except as described below under “—Conversion Price Adjustments”, no adjustment will be made on conversion of any notes for any interest or liquidated damages accrued on such notes or for dividends on any common stock issued. If notes are converted after a record date for the payment of interest and prior to the next succeeding interest payment date, such notes must be accompanied by funds equal to the interest payable on such succeeding interest payment date on the principal amount so converted; provided, however, no such funds need be paid if (1) payment default has occurred and is continuing or (2) we have specified a redemption date that is after a record date and prior to the next interest payment date. (You will not receive any cash payments representing accrued interest upon conversion unless you convert on an interest payment date.) Our delivery to you of the fixed number of shares of common stock into which the note is convertible, together with any cash payments in lieu of any fractional shares, will satisfy our obligation to pay the principal amount of such note and the accrued but unpaid interest through the conversion date.

We are not required to issue fractional shares of common stock upon conversion of notes and, in lieu of such fractional shares, we will pay a cash adjustment based upon the average closing price of the common stock during the five trading days immediately preceding the date of conversion.

In the event any holder exercises its right to require us to purchase any notes on any purchase date, such holder’s conversion right with respect to such notes will terminate on the close of business on the relevant purchase date, unless we default on the payment due upon purchase of such notes or the holder elects to withdraw the submission of election to have such notes purchased. See “—Purchase of Notes by Us at the Option of the Holders.” In the event any holder exercises its right to require us to repurchase any notes upon a designated event, such holder’s conversion right with respect to such notes will terminate on the close of business on the designated event offer termination date (as defined in the indenture), unless we default on the payment due upon repurchase or the holder elects to withdraw the submission of election to repurchase. See “—Repurchase at Option of Holders Upon a Designated Event.”

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The right of conversion attaching to any note may be exercised by the holder, if the conditions to conversion are met, by delivering the note at the specified office of a conversion agent, accompanied by a duly signed and completed notice of conversion, together with any funds that may be required. Such notice of conversion can be obtained from the trustee. Beneficial owners of interests in a global note may exercise their right of conversion by delivering to DTC the appropriate instruction form for conversion pursuant to DTC’s conversion program. The conversion date will be the date on which the note, the duly signed and completed notice of conversion, and any funds that may be required as described above shall have been so delivered. A holder delivering a note for conversion will not be required to pay any taxes or duties payable in respect of the issue or delivery of common stock on conversion, but will be required to pay any tax or duty which may be payable in respect of any transfer involved in the issue or delivery of the common stock in a name other than the holder of the note. Certificates representing shares of common stock will not be issued or delivered unless all taxes and duties, if any, payable by the holder have been paid.

The shares of the common stock issuable upon conversion of any notes will be delivered to the holders entitled thereto as promptly as practicable.

Conversion Upon Satisfaction of Sale Price Condition

A holder may surrender any of its notes for conversion into shares of our common stock in any calendar quarter after the quarter ending June 30, 2003 if the last reported sale price of our common stock for at least 20 trading days during the period of 30 consecutive trading days ending on the last trading day of the immediately preceding calendar quarter is greater than or equal to 130% of the conversion price per share of our common stock on such last trading day.

The “last reported sale price” of our common stock on any date means the closing sale price per share (or if no closing sale price is reported, the average of the bid and asked prices or, if more than one in either case, the average of the average bid and the average asked prices) on that date as reported in composite transactions for the principal U.S. securities exchange on which our common stock is traded or, if our common stock is not listed on a U.S. national or regional securities exchange, as reported by the Nasdaq National Market. If our common stock is not listed for trading on a U.S. national or regional securities exchange and not reported by the Nasdaq National Market on the relevant date, the “last reported sale price” will be the last quoted bid price for our common stock in the over-the-counter market on the relevant date as reported by the National Quotation Bureau or similar organization. If our common stock is not so quoted, the “last reported sale price” will be the average of the mid-point of the last bid and asked prices for our common stock on the relevant date from each of at least three nationally recognized independent investment banking firms selected by us for this purpose.

Conversion Based on Trading Price of the Notes

A holder also may surrender any of its notes for conversion into shares of our common stock during the five-business-day period following any ten consecutive trading days in which the average of the trading prices for the notes was less than 98% of the average closing sale price of our common stock multiplied by the conversion rate.

The “trading price” of the notes on any date of determination means the average of the secondary market bid quotations per note obtained by the trustee for $10,000,000 principal amount of the notes at approximately 3:30 p.m., New York City time, on such determination date from three independent nationally recognized securities dealers we select, provided that if at least three such bids cannot be obtained, but two such bids are obtained by the trustee, then the average of the two bids shall be used. If the trustee cannot reasonably obtain at least two bids for $10,000,000 principal amount of the notes from a nationally recognized securities dealer, or in our reasonable judgment, the bid quotations are not indicative of the secondary market value of the notes, then the trading price of the notes will be deemed to be equal to 97.9% of (a) the conversion rate of the notes on the date of determination multiplied by (b) the closing price on the New York Stock Exchange of our common stock on such determination date.

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The trustee will determine the trading price after being requested to do so by us. We will have no obligation to make that request unless a holder of notes provides us with reasonable evidence that the trading price of the notes may be less than 98% of the average closing sale price of our common stock multiplied by the applicable conversion rate for the applicable period. If a holder provides such evidence, we will instruct the trustee to determine the trading price of the notes for the applicable period.

Conversion Upon Notice of Redemption

If we call any or all of the notes for redemption, holders may convert notes into our common stock at any time prior to the close of business on the redemption date, even if the notes are not otherwise convertible at such time.

Conversion Upon Specified Corporate Transactions

If we elect to:

• distribute to all holders of our common stock certain rights entitling them to purchase, for a period expiring within 45 days after the date of the distribution, shares of our common stock at less than the last reported sale price of a share of our common stock on the trading day immediately preceding the declaration date of the distribution; or

• distribute to all holders of our common stock our assets, debt securities or certain rights to purchase our securities, which distribution has a per share value as determined by our board of directors exceeding 15% of the last reported sale price of a share of our common stock on the trading day immediately preceding the declaration date of the distribution,

we must notify the holders of the notes at least 20 business days prior to the ex-dividend date for such distribution. Once we have given such notice, holders may surrender their notes for conversion at any time until the earlier of the close of business on the business day immediately prior to the ex-dividend date and our announcement that such distribution will not take place, even if the notes are not otherwise convertible at such time. The ex-dividend date is the first date upon which a sale of the common stock does not automatically transfer the right to receive the relevant distribution from the seller of the common stock to its buyer.

In addition, if we engage in certain reclassifications of our common stock or are a party to a consolidation, merger, binding share exchange or transfer of all or substantially all of our assets pursuant to which our common stock is converted into cash, securities or other property, a holder may surrender notes for conversion at any time from and after the date which is 15 days prior to the anticipated effective date of the transaction until 15 days after the actual effective date of such transaction and at the effective time of the transaction, the right to convert a note into our common stock will be changed into a right to convert a note into the kind and amount of cash, securities or other property which the holder would have received if the holder had converted its Notes immediately prior to the applicable record date for such transaction. If we engage in any transaction described in the preceding sentence, the conversion price will not be adjusted. If the transaction also constitutes a designated event as defined below, a holder can require us to purchase all or a portion of its notes, as described under “—Repurchase at Option of Holders Upon a Designated Event.”

Conversion Price Adjustments

The conversion price is subject to adjustment (under formulae set forth in the indenture) in certain circumstances, including:

(i)  the issuance of our common stock as a dividend or distribution on our common stock;

(ii)  certain subdivisions and combinations of our common stock;

(iii)  the issuance to all holders of our common stock of certain rights or warrants to purchase, for a period expiring within 45 days after the date of issuance, our common stock at a price per share less than the current market price (as defined in the indenture);

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(iv)  the distribution to all holders of our common stock of shares of our capital stock (other than common stock) or evidences of our indebtedness or assets (including securities, but excluding those rights, warrants, dividends and distributions referred to above or paid exclusively in cash referred to in clause (v));

(v)  dividends or other distributions (other than regular quarterly cash dividends) consisting exclusively of cash to all holders of our common stock to the extent such distributions, combined together with:

• all such all-cash distributions made within the preceding 12 months in respect of which no adjustment has been made, plus

• any cash and the fair market value of other consideration payable in respect of any tender offers by us or any of our subsidiaries for our common stock concluded within the preceding 12 months in respect of which no adjustment has been made,

exceed 15% of our market capitalization (being the product of the then current market price of the common stock times the number of shares of common stock then outstanding) on the record date for such distribution; and

(vi)  the purchase of our common stock pursuant to a tender offer, other than the purchase of notes as part of a designated event, made by us or any of our subsidiaries to the extent that the aggregate consideration, together with

• any cash and the fair market value of any other consideration payable in any other tender offer expiring within 12 months preceding such tender offer in respect of which no adjustment has been made, plus

• the aggregate amount of any such all-cash distributions referred to in clause (v) above to all holders of our common stock within 12 months preceding the expiration of such tender offer in respect of which no adjustments have been made,

exceeds 15% of our market capitalization (being the product of the then current market price of the common stock times the number of shares of common stock then outstanding) on the expiration of such tender offer.

The fair market value of other considerations payable under the clause (v) above will be calculated on the record date of the distribution of such other consideration and the fair market value of other consideration payable under clause (vi) above will be calculated as of the expiration of the tender offer.

We may, instead of making any required adjustment in the conversion price under clause (iv), make provision so that each holder of notes who converts a note shall be entitled to receive upon conversion, in addition to shares of common stock, the amount and kind of distributions that the holder would have been entitled to receive if the holder had converted the note immediately prior to the date fixed for determining the stockholders entitled to receive the distribution.

In the case of:

• any reclassification or change of our common stock; or

• a consolidation, merger, share exchange or combination involving us or a sale, conveyance or other disposition to another corporation of our property and assets as an entirety or substantially as an entirety,

in each case, as a result of which holders of our common stock will be entitled to receive stock, other securities, other property or assets (including cash) with respect to or in exchange for our common stock, the holders of the notes then outstanding will be entitled thereafter to convert such notes into the kind and amount of shares of stock, other securities, other property or assets, which they would have owned or been entitled to receive upon such reclassification, change, consolidation, merger, share exchange, combination, sale, conveyance or other disposition had such notes been converted into common stock immediately prior to such reclassification, change, consolidation, merger, share exchange, combination, sale, conveyance or other disposition (assuming, in a case in which our stockholders may exercise rights of election, that a holder of notes would not have exercised any rights

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of election as to the stock, other securities, other property or assets receivable in connection therewith and would have received per share the kind and amount received per share by a plurality of non-electing shares). Certain of the foregoing events may also constitute or result in a designated event requiring us to offer to repurchase the notes. See “—Repurchase at Option of Holders Upon a Designated Event.” The adjustment will not be made for a consolidation, merger or share exchange or combination that does not result in any reclassification, conversion, exchange or cancellation of our common stock.

Certain adjustments to, or failures to adjust, the conversion price of the notes may cause holders of notes or common stock to be treated for federal income tax purposes as having received a taxable distribution under the federal income tax laws. See “Certain U.S. Federal Income Tax Consequences.” We may, at our option, make such reductions in the conversion price as our board of directors deems advisable to avoid or diminish any potential income tax liability to the holders of our common stock which may result from the absence of such adjustments.

In addition, we may from time to time (to the extent permitted by law) reduce the conversion price underlying the notes by any amount for any period of at least 20 days, in which case we shall give at least 15 days’ notice of such decrease, if our board of directors has made a determination that such decrease would be in our interests, which determination shall be conclusive.

No adjustment in the conversion price will be required unless such adjustment would require a change of at least 1% of the conversion price then in effect; provided that any adjustment that would otherwise be required to be made shall be carried forward and taken into account in any subsequent adjustment. Except as stated above, the conversion price will not be adjusted for the issuance of common stock or any securities convertible into or exchangeable for common stock or carrying the right to purchase any of the foregoing.

Ranking

The notes are our senior unsecured obligations and rank equally with all of our other existing and future senior unsecured indebtedness. The notes are effectively subordinated to all of our existing and future secured indebtedness to the extent of the assets securing that indebtedness. The notes are structurally subordinated to all liabilities of our subsidiaries. As of June 30, 2003, we had approximately $12.2 billion of total consolidated indebtedness; $5.9 billion of secured indebtedness (excluding secured indebtedness of our subsidiaries); and approximately $1.8 billion of subsidiary indebtedness, which are effectively senior to the notes. The indenture does not limit the amount of additional indebtedness that we can create, incur, assume or guarantee, or limit the amount of assets that we can use to secure our other indebtedness, nor does the indenture limit the amount of indebtedness and other liabilities that any subsidiary can create, incur, assume or guarantee.

Optional Redemption

No sinking fund is provided for the notes. Prior to June 5, 2008, the notes will not be redeemable. On or after June 5, 2008, we may redeem for cash all or a portion of the notes at any time for a price equal to 100% of the principal amount of the notes to be redeemed plus any accrued and unpaid interest to but excluding the redemption date. We will provide not less than 30 nor more than 60 days’ notice mailed to each registered holder of the notes to be redeemed. If the redemption notice is given and funds deposited as required, then interest will cease to accrue on and after the redemption date on the notes or portions of such notes called for redemption.

If we decide to redeem fewer than all of the outstanding notes, the trustee will select the notes to be redeemed by lot, or on a pro rata basis or by another method the trustee considers fair and appropriate.

If the trustee selects a portion of your notes for partial redemption and you convert a portion of your notes, the converted portion will be deemed to be from the portion selected for redemption.

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Purchase of Notes by Us at the Option of the Holders

Holders have the right to require us to purchase all or a portion of their notes on June 3, 2008, June 3, 2013 and June 3, 2018 (each, a “purchase date”). Any note purchased by us on a purchase date will be paid for in cash. We will be required to purchase any outstanding notes for which a holder delivers a written purchase notice to the paying agent. This notice must be delivered during the period beginning at any time from the opening of business on the date that is 20 business days prior to the relevant purchase date until the close of business on the fifth business day prior to the purchase date. If the purchase notice is given and withdrawn during such period, we will not be obligated to purchase the related notes. Also, as described in the “Risk Factors” section of this prospectus under the caption “We may be unable to repay or repurchase the notes,” we may not have funds sufficient to purchase notes when we are required to do so.

The purchase price payable will be equal to 100% of the principal amount of the notes to be purchased plus any accrued and unpaid interest to, but excluding, the purchase date.

On or before the 20th business day prior to each purchase date, we will provide to the trustee, the paying agent and to all holders of the notes at their addresses shown in the register of the registrar, and to beneficial owners as required by applicable law, a notice stating, among other things:

• the purchase price;

• the name and address of the paying agent and the conversion agent; and

• the procedures that holders must follow to require us to purchase their notes.

Simultaneously with providing such notice, we will publish a notice containing this information in a newspaper of general circulation in The City of New York or publish the information on our web site or through such other public medium as we may use at that time.

A notice electing to require us to purchase your notes must state:

• if certificated notes have been issued, the certificate numbers of the notes;

• the portion of the principal amount of notes to be purchased, in integral multiples of $1,000; and

• that the notes are to be purchased by us pursuant to the applicable provisions of the notes and the indenture.

If the notes are not in certificated form, your notice must comply with appropriate DTC procedures.

No notes may be purchased at the option of holders if there has occurred and is continuing an event of default other than an event of default that is cured by the payment of the purchase price of the notes.

You may withdraw any purchase notice in whole or in part by a written notice of withdrawal delivered to the paying agent prior to the close of business on the business day prior to the purchase date. The notice of withdrawal must state:

• the principal amount of the withdrawn notes;

• if certificated notes have been issued, the certificate numbers of the withdrawn notes; and

• the principal amount, if any, which remains subject to the purchase notice.

If the notes are not in certificated form, your notice must comply with appropriate DTC procedures.

You must either effect book-entry transfer or deliver the notes, together with necessary endorsements, to the office of the paying agent after delivery of the purchase notice to receive payment of the purchase price. You will receive payment promptly following the later of the purchase date or the time of book-entry transfer or the

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delivery of the notes. If the paying agent holds money sufficient to pay the purchase price of the notes on the business day following the purchase date, then:

• the notes will cease to be outstanding and interest will cease to accrue (whether or not book-entry transfer of the notes is made or whether or not the note is delivered to the paying agent); and

• all other rights of the holder will terminate (other than the right to receive the purchase price upon delivery or transfer of the notes).

Repurchase at Option of Holders Upon a Designated Event

If a designated event (as defined below) occurs at any time prior to the maturity of the notes, holders may require us to repurchase their notes for cash, in whole or in part, on a repurchase date set by us that is 20 business days after the date of our notice of such designated event. The notes will be redeemable in integral multiples of $1,000 principal amount.

We will redeem the notes at a price equal to 100% of the principal amount to be redeemed, plus accrued and unpaid interest to, but excluding, the repurchase date. If the repurchase date is an interest payment date, we will pay interest to the record holder on the relevant record date.

We will mail to all record holders a notice of a designated event within 30 days after it has occurred. We are also required to deliver to the trustee a copy of the designated event notice. The notice must describe the designated event, your right to elect repurchase of notes and the repurchase date. If a holder elects to have its notes redeemed, such holder must deliver to us or our designated agent, on or before the 20th business day after the date of our designated event notice, a repurchase notice and any notes to be redeemed, duly endorsed for transfer. We will promptly pay the repurchase price for notes surrendered for repurchase following the designated event repurchase date.

A “designated event” is any transaction or event (whether by means of an exchange offer, liquidation, tender offer, consolidation, merger, combination, reclassification, recapitalization or otherwise) in connection with which all or substantially all of our common stock is exchanged for, converted into, acquired for or constitutes solely the right to receive, consideration which is not all or substantially all common stock that:

• is listed on, or immediately after the transaction or event will be listed on, a United States national securities exchange, or

• is approved, or immediately after the transaction or event will be approved, for quotation on the Nasdaq National Market or any similar United States system of automated dissemination of quotations of securities prices.

We will comply with any applicable provisions of Rule 13e-4 and any other tender offer rules under the Exchange Act in the event of a designated event.

These designated event repurchase rights could discourage a potential acquiror. However, this designated event redemption feature is not the result of management’s knowledge of any specific effort to obtain control of us by means of a merger, tender offer or solicitation, or part of a plan by management to adopt a series of anti-takeover provisions. The term “designated event” is limited to specified transactions and may not include other events that might adversely affect our financial condition or business operations. Our obligation to offer to repurchase the notes upon a designated event would not necessarily afford you protection in the event of a highly leveraged transaction, reorganization, merger or similar transaction involving us.

We may be unable to repurchase the notes in the event of a designated event. If a designated event were to occur, we may not have enough funds to pay the repurchase price for all tendered notes. In addition, any future credit agreements or other agreements relating to our indebtedness may contain provisions prohibiting

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redemption of the notes under certain circumstances, or expressly prohibit our repurchase of the notes upon a designated event or may provide that a designated event constitutes an event of default under that agreement. If a designated event occurs at a time when we are prohibited from purchasing or redeeming notes, we could seek the consent of our lenders to redeem the notes or attempt to refinance the notes. If we do not obtain consent, we would not be permitted to purchase or redeem the notes. Our failure to redeem tendered notes would constitute an event of default under the indenture, which might constitute a default under the terms of our other indebtedness.

Merger and Consolidation

The indenture provides that we may not consolidate or merge with or into, or transfer, lease or convey all or substantially all of our properties or assets to another corporation, person or entity as an entirety or substantially as an entirety unless:

• either we are the continuing corporation, or any successor or purchaser is a corporation, partnership or trust organized under the laws of the United States, any state thereof or the District of Columbia and the successor or purchaser expressly assumes our obligations on the notes under a supplemental indenture in a form reasonably satisfactory to the trustee;

• in all cases, immediately after giving effect to the transaction, no default or event of default, and no event that, after notice or lapse of time or both, would become an event of default, will have occurred and be continuing; and

• if a supplemental indenture is to be executed in connection with such consolidation, merger, transfer or lease, we have delivered to the trustee an officers’ certificate and an opinion of counsel stating compliance with these provisions.

Upon any such consolidation, merger, conveyance, lease or transfer in accordance with the foregoing, the successor person formed by such consolidation or share exchange or into which we are merged or to which such sale, assignment, conveyance, lease, transfer or other disposition is made will succeed to, and be substituted for, and may exercise our right and power, under the indenture with the same effect as if such successor had been named as us in the indenture, and thereafter (except in the case of a sale, assignment, transfer, lease, conveyance or other disposition) the predecessor corporation will be relieved of all further obligations and covenants under the indenture and the notes.

Registration Rights

Pursuant to a registration rights agreement, we have agreed for the benefit of the holders of the notes and common stock issued upon conversion thereof that:

• we will, at our cost, within 90 days after the date of initial issuance of the notes, file a shelf registration statement with the SEC with respect to resales of the notes and the common stock issuable upon their conversion;

• we will use our reasonable best efforts to cause such shelf registration statement to be declared effective under the Securities Act within 180 days after the closing date of the notes; and

• we will use our reasonable best efforts to keep the shelf registration statement continuously effective under the Securities Act until the earliest of (i) the expiration of the holding period applicable to sales of the notes and the common stock issuable upon conversion of the notes under Rule 144(k) (or any successor provision) under the Securities Act; (ii) the date as of which all the notes or the common stock issuable upon their conversion have been transferred under Rule 144 under the Securities Act (or any similar provision then in force); and (iii) the date as of which all the notes or the common stock issuable upon their conversion have been sold pursuant to the shelf registration statement.

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If the shelf registration statement:

• is not filed with the SEC on or prior to 90 days after the closing date of the notes, or has not been declared effective by the SEC within 180 days after the closing date of the notes; or

• is filed and declared effective but shall thereafter cease to be effective (without being succeeded immediately by a replacement shelf registration statement filed and declared effective) or usable for the offer and sale of transfer restricted securities for a period of time (including any suspension period) which exceeds 45 days in the aggregate in any three-month period or 90 days in the aggregate in any 12-month period during the period beginning on the effective date of the shelf registration statement and ending on or prior to the expiration of the holding period applicable to sales of the notes and the common stock issuable upon conversion of the notes under Rule 144(k) (or any successor provision) under the Securities Act,

(both of which we refer to as a “registration default”), we will pay liquidated damages to each holder of transfer restricted securities which has complied with its obligations under the registration rights agreement.

The amount of liquidated damages payable during any period in which a registration default has occurred and is continuing is that amount which is equal to:

• 0.25 percent (or 25 basis points) per annum per $1,000 principal amount of notes or $2.50 per annum per 35.7143 shares of our common stock (subject to adjustment in the event of a stock split, stock recombination, stock dividend and the like) constituting transfer restricted securities, during which such registration default has occurred and is continuing.

We have agreed to pay all accrued liquidated damages, if any, on June 3 and December 3 of each year, to the person in whose name a note is registered at the close of business on the relevant record date, in accordance with the terms of the registration rights agreement. Following the cure of a registration default, liquidated damages will cease to accrue with respect to such registration default.

“Transfer restricted securities” means each note and any share of our common stock issued on conversion thereof until the earliest of the date on which such note or share, as the case may be:

• has been transferred pursuant to a registration statement covering such note or share which has been filed with the SEC pursuant to the Securities Act, in either case after such registration statement has become, and while such registration statement is, effective under the Securities Act;

• has been transferred pursuant to Rule 144 under the Securities Act (or any similar provision then in force); or

• may be sold or transferred pursuant to paragraph (k) of Rule 144 under the Securities Act (or any successor provision promulgated by the SEC).

We will provide or cause to be provided to each holder of the notes or our common stock issuable upon conversion of such notes that has delivered to us a completed notice and questionnaire, as described below, copies of the prospectus, which will be a part of the shelf registration statement. We will also notify or cause to be notified each such holder when the shelf registration statement for the notes or our common stock issuable upon conversion of such notes has become effective and take certain other actions as are required to permit unrestricted resales of the notes or our common stock issuable upon conversion of such notes. A holder of notes or our common stock issuable upon conversion of such notes that sells such securities pursuant to a shelf registration statement:

• will be required to be named as a selling securityholder in the prospectus related to the shelf registration statement and to deliver a prospectus to purchasers;

• will be subject to certain of the civil liability provisions under the Securities Act in connection with such sales; and

• will be bound by the provisions of the registration rights agreement that are applicable to such holder (including certain indemnification and contribution rights or obligations).

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We will be permitted to suspend the use of the prospectus which is a part of the shelf registration statement for a period not to exceed either 45 days in the aggregate in any three-month period or 90 days in the aggregate during any twelve-month period (both of which we refer to as a “suspension period”) under certain circumstances including the acquisition or divestiture of assets, to pending corporate developments, public filings with the SEC and similar events. We will pay all expenses of the shelf registration statement; however, each holder will be required to bear the expense of any broker’s commission, agency fee or underwriter’s discount or commission.

Events of Default and Remedies

An event of default is defined in the indenture as being:

(i) a default in payment of the principal of the notes when due upon redemption, repurchase or otherwise;

(ii) a default for 30 days in payment of any installment of interest on or liquidated damages with respect to the notes;

(iii) a failure to comply with or observe in any material respect any other covenant or agreement in respect of the notes contained in the indenture or the notes for 60 days after written notice to us by the trustee or to us and the trustee by holders of at least 25% in aggregate principal amount of the notes then outstanding;

(iv) a default in the payment of the designated event repurchase price in respect of the notes on the date for such payment;

(v) a default under any credit agreement, mortgage, indenture or instrument under which there may be issued or by which there may be secured or evidenced any indebtedness for money borrowed by us or any of our restricted subsidiaries (other than any such indebtedness which is non-recourse to us or such restricted subsidiary (as defined below)), which default:

• is caused by a failure to pay when due any principal on such indebtedness at the final stated maturity date of such indebtedness, which failure continues beyond any applicable grace period, or

• results in the acceleration of such indebtedness prior to its express maturity, without such acceleration being rescinded or annulled,

and, in each case, the principal amount of such indebtedness, together with the principal amount of any other such indebtedness under which there is a payment default at the final stated maturity thereof or the maturity of which has been so accelerated, aggregates to $75 million or more and such payment default is not cured or such acceleration is not annulled within 30 days after written notice to us by the trustee or to us and the trustee by holders of at least 25% in aggregate principal amount of the notes then outstanding; or

(vi) certain events involving our bankruptcy, insolvency or reorganization.

If an event of default (other than an event of default specified in clause (vi) above) occurs and is continuing, then and in every such case the trustee, by written notice to us, or the holders of not less than 25% in aggregate principal amount of the notes then outstanding, by written notice to us and the trustee, may declare the unpaid principal of, and accrued and unpaid interest and accrued and unpaid liquidated damages, if any, on all the notes then outstanding to be due and payable. Upon such declaration, such principal amount and accrued and unpaid interest and accrued and unpaid liquidated damages, if any, will become immediately due and payable, notwithstanding anything contained in the indenture or the notes to the contrary. If any event of default specified in clause (vi) above occurs, all unpaid principal of and accrued and unpaid interest and liquidated damages, if any, on the notes then outstanding will automatically become due and payable without any declaration or other act on the part of the trustee or any holder of notes.

Holders of the notes may not enforce the indenture or the notes except as provided in the indenture. Subject to the provisions of the indenture relating to the duties of the trustee, the trustee is under no obligation to exercise

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any of its rights or powers under the indenture at the request, order or direction of any of the holders, unless such holders have offered to the trustee a security or an indemnity satisfactory to it against any cost, expense or liability. Subject to all provisions of the indenture and applicable law, the holders of a majority in aggregate principal amount of the notes then outstanding have the right to direct the time, method and place of conducting any proceeding for any remedy available to the trustee or exercising any trust or power conferred on the trustee. If a default or event of default occurs and is continuing and is known to the trustee, the indenture requires the trustee to mail a notice of default or event of default to each holder within 90 days of the occurrence of such default or event of default. However, the trustee may withhold from the holders notice of any continuing default or event of default (except a default or event of default in the payment of principal, interest or liquidated damages, if any, or redemption price, purchase price or designated event repurchase price, if applicable, on the notes) if it determines in good faith that withholding notice is in their interest. The holders of a majority in aggregate principal amount of the notes then outstanding by written notice to the trustee may rescind any acceleration of the notes and its consequences if all existing events of default (other than the nonpayment of principal of and interest and liquidated damages, if any, on the notes that have become due solely by virtue of such acceleration) have been cured or waived and if the rescission would not conflict with any judgment or decree of any court of competent jurisdiction. No such rescission will affect any subsequent default or event of default or impair any right consequent thereto.

A holder of notes may pursue any remedy under the indenture only if:

• the holder gives the trustee written notice of a continuing event of default on the notes;

• the holder of at least 25% in aggregate principal amount of the notes then outstanding makes a written request to the trustee to pursue the remedy;

• the holder offers to the trustee indemnity reasonably satisfactory to the trustee;

• the trustee fails to act for a period of 60 days after the receipt of notice and offer of indemnity; and

• during that 60-day period, the holders of a majority in principal amount of the notes then outstanding do not give the trustee a direction inconsistent with the request.

This provision does not, however, affect the right of a holder of notes to sue for enforcement of the payment of the principal, interest or liquidated damages, if any, or redemption price, purchase price or designated even repurchase price, if applicable, on the holder’s note on or after the respective due dates expressed in its note or the holder’s right to convert its note in accordance with the indenture.

The holders of no less than a majority in aggregate principal amount of the notes then outstanding may, on behalf of the holders of all the notes, waive any past default or event of default under the indenture and its consequences, except default in the payment of principal or interest or liquidated damages, if any, on the notes (other than the nonpayment of principal, interest or liquidated damages, if any, on the notes that have become due solely by virtue of an acceleration that has been duly rescinded as provided above) or in respect of a covenant or provision of the indenture that cannot be modified or amended without the consent of all holders of notes then outstanding.

We are required to deliver to the trustee annually a statement regarding compliance with the indenture and we are required, upon becoming aware of any default or event of default, to deliver to the trustee a statement specifying such default or event of default.

“Restricted subsidiary” means any subsidiary (i) substantially all of the property of which is located, and substantially all of the operations of which are conducted, in the United States, and (ii) which owns a principal property, except a subsidiary which is primarily engaged in the business of a finance company.

“Principal property” means any aircraft, or any aircraft engine installed in any aircraft, that has 75 or more passenger seats, whether now owned or hereafter acquired by us or any restricted subsidiary.

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Amendment, Supplement and Waiver

Except as provided in the next two succeeding paragraphs, the indenture may be amended or supplemented with the consent of the holders of at least a majority in aggregate principal amount of the notes then outstanding (including consents obtained in connection with a tender offer or exchange offer for notes), and any existing default or compliance with any provision of the indenture or the notes may be waived with the consent of the holders of a majority in principal amount of the notes then outstanding (including consents obtained in connection with a tender offer or exchange offer for notes).

Without the consent of each holder affected, an amendment or waiver may not (with respect to any notes held by a non-consenting holder):

• reduce the principal amount of notes whose holders must consent to an amendment, supplement or waiver;

• reduce the principal of or change the fixed maturity of any note or, other than as set forth in the paragraph below, alter the provisions with respect to the redemption or repurchase of the notes;

• reduce the rate or amount of or change the time for payment of interest, including defaulted interest and liquidated damages, if any, redemption price, purchase price or designated event repurchase price, if applicable, on any notes;

• waive a default or event of default in the payment of principal of interest or liquidated damages, if any, on the notes (except a rescission of acceleration of the notes by the holders of at least a majority in aggregate principal amount of the notes then outstanding and a waiver of the payment default that resulted from such acceleration);

• make any note payable in money other than that stated in the indenture and the notes;

• make any change in the provisions of the indenture relating to waivers of past defaults or the rights of holders of notes to receive payments of principal, interest or liquidated damages, if any, redemption price, purchase price or designated event repurchase price, if applicable, on the notes;

• waive a designated event payment with respect to any note;

• increase the conversion price or, except as permitted by the indenture, modify the provisions of the indenture relating to conversion of the notes in a manner adverse to the holders; or

• make any change to the abilities of holders of notes to enforce their rights under the indenture or the foregoing provisions or this provision.

Notwithstanding the foregoing, without the consent of any holder of notes, we and the trustee may amend or supplement the indenture or the notes to:

• cure any ambiguity, defect or inconsistency or make any other changes in the provisions of the indenture which we and the trustee may deem necessary or desirable, provided such amendment does not materially and adversely affect rights of the holders of the notes under the indenture;

• provide for the assumption of our obligations to holders of notes in the circumstances required under the indenture as described under “—Merger and Consolidation;”

• provide for conversion rights of holders of notes in certain events such as our consolidation or merger or the sale of all or substantially all of our assets;

• reduce the conversion price;

• evidence and provide for the acceptance of the appointment under the indenture of a successor trustee;

• make any change that would provide any additional rights or benefits to the holders of notes or that does not adversely affect the legal rights under the indenture of any such holder;

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• comply with requirements of the SEC in order to effect or maintain the qualification of the indenture under the Trust Indenture Act of 1939; or

• modify the restrictions on, and procedures for, resale and other transfers of shares pursuant to law, regulation or practice relating to the resale or transfer of restricted securities generally.

Discharge of the Indenture

We may satisfy and discharge our obligations under the indenture by delivering to the trustee for cancellation all outstanding notes or by depositing with the trustee, the paying agent or the conversion agent, if applicable, after the notes have become due and payable, whether at stated maturity or any redemption date, or any purchase date, or a designated event repurchase date, or upon conversion or otherwise, cash or shares of common stock (as applicable under the terms of the indenture) sufficient to pay all of the outstanding notes and paying all other sums payable under the indenture.

Governing Law

The indenture provides that the notes are governed by, and construed in accordance with, the laws of the State of New York.

Form, Exchange, Registration and Transfer

The notes were issued in registered form, without interest coupons. We will not charge a service fee for any registration of transfer or exchange of the notes. We may, however, require the payment of any tax or other governmental charge payable for that registration.

The notes will be exchangeable for other notes, for the same total principal amount and for the same terms but in different authorized denominations, in accordance with the indenture. Holders may present notes for registration of transfer at the office of the security registrar or any transfer agent we designate. The security registrar or transfer agent will effect the transfer or exchange when it is satisfied with the documents of title and identity of the person making the request.

We have appointed the trustee as security registrar for the notes. We may at any time rescind that designation or approve a change in the location through which any such security registrar acts. We are required to maintain an office or agency for transfer and exchanges in each place of payment. We may at any time designate additional registrars for the notes.

The registered holder of a note will be treated as the owner of it for all purposes.

Book-Entry; Delivery and Form; Global Note

Notes sold in the United States in reliance on Rule 144A or in offshore transactions in reliance on Regulation S will be represented by a single, permanent global note in definitive, fully registered form without interest coupons. The global note will be deposited with the trustee as custodian for DTC and registered in the name of a nominee of DTC in New York, New York for the accounts of participants in DTC.

Investors who are qualified institutional buyers and who purchase notes in reliance on Rule 144A under the Securities Act may hold their interests in the global note directly through DTC if they are DTC participants, or indirectly through organizations that are DTC participants.

Investors who purchase notes in offshore transactions in reliance on Regulation S under the Securities Act may hold their interests in the global note directly through Euroclear Bank S.A./N.V., as operator of the Euroclear System (“Euroclear”) and Clearstream Banking, société anonyme (“Clearstream”), if they are

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participants in such systems, or indirectly through organizations that are participants in such systems. Euroclear and Clearstream will hold interests in the global note on behalf of their participants through their respective depositaries, which in turn will hold such interests in the global note in the depositaries’ names on the books of DTC.

Except in the limited circumstances described below, holders of notes represented by interests in the global note will not be entitled to receive notes in definitive form.

DTC has advised us as follows: DTC is a limited purpose trust company organized under the laws of the State of New York Uniform Commercial Code and a “clearing corporation” within the meaning of the New York Uniform Commercial Code and a “clearing agency” registered pursuant to the provisions of Section 17A of the Exchange Act. DTC was created to hold securities of institutions that have accounts with DTC (which we refer to as “participants”) and to facilitate the clearance and settlement of securities transactions among its participants in such securities through electronic book-entry changes in accounts of the participants, thereby eliminating the need for physical movement of securities certificates. DTC’s participants include securities brokers and dealers (which may include the initial purchaser), banks, trust companies, clearing corporations and certain other organizations. Access to DTC’s book-entry system is also available to others such as banks, brokers, dealers and trust companies that clear through or maintain a custodial relationship with a participant, whether directly or indirectly.

Upon the issuance of the global note, DTC will credit, on its book-entry registration and transfer system, the respective principal amount of the individual beneficial interests represented by the global note to the accounts of participants. The accounts to be credited shall be designated by the initial purchaser of such beneficial interests. Ownership of beneficial interests in the global note will be limited to participants or persons that may hold interests through participants. Ownership of beneficial interests in the global note will be shown on, and the transfer of those ownership interests will be effected only through, records maintained by DTC (with respect to participants’ interests) and such participants (with respect to the owners of beneficial interests in the global note other than participants).

So long as DTC or its nominee is the registered holder and owner of the global note, DTC or such nominee, as the case may be, will be considered the sole legal owner of the notes represented by the global note for all purposes under the indenture and the notes. Except as set forth below, owners of beneficial interests in the global note will not be entitled to receive notes in definitive form and will not be considered to be the owners or holders of any notes under the global note. We understand that under existing industry practice, in the event an owner of a beneficial interest in the global note desires to take any actions that DTC, as the holder of the global note, is entitled to take, DTC would authorize the participants to take such action, and that participants would authorize beneficial owners owning through such participants to take such action or would otherwise act upon the instructions of beneficial owners owning through them. No beneficial owner of an interest in the global note will be able to transfer the interest except in accordance with DTC’s applicable procedures, in addition to those provided for under the indenture and, if applicable, those of Euroclear and Clearstream.

Payments of the principal of and interest and liquidated damages, if any, on the notes represented by the global note registered in the name of and held by DTC or its nominee will be made to DTC or its nominee, as the case may be, as the registered owner and holder of the global note.

We expect that DTC or its nominee, upon receipt of any payment of principal or interest or liquidated damages, if any, in respect of the global note, will credit participants’ accounts with payments in amounts proportionate to their respective beneficial interests in the principal amount of the global note as shown on the records of DTC or its nominee. We also expect that payments by participants to owners of beneficial interests in the global note held through such participants will be governed by standing instructions and customary practices as is now the case with securities held for accounts of customers registered in the names of nominees for such customers. Such payments, however, will be the responsibility of such participants and indirect participants, and neither we, the trustee nor any paying agent will have any responsibility or liability for any aspect of the records

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relating to, or payments made on account of, beneficial ownership interests in the global note or for maintaining, supervising or reviewing any records relating to such beneficial ownership interests or for any other aspect of the relationship between DTC and its participants or the relationship between such participants and the owners of beneficial interests in the global note.

Unless and until it is exchanged in whole or in part for notes in definitive form, the global note may not be transferred except as a whole by DTC to a nominee of DTC or by a nominee of DTC to DTC or another nominee of DTC.

Transfers between participants in DTC will be effected in the ordinary way in accordance with DTC rules and will be settled in same-day funds. Transfers between participants in Euroclear and Clearstream will be effected in the ordinary way in accordance with their respective rules and operating procedures.

Cross-market transfers between DTC, on the one hand, and directly or indirectly through Euroclear or Clearstream participants, on the other, will be effected in DTC in accordance with DTC rules on behalf of Euroclear or Clearstream, as the case may be, by its respective depositary; however, such cross-market transactions will require delivery of instructions to Euroclear or Clearstream, as the case may be, by the counterparty in such system in accordance with its rules and procedures and within its established deadlines (Brussels time). Euroclear or Clearstream, as the case may be, will, if the transaction meets its settlement requirements, deliver instructions to its respective depositary to take action to effect final settlement on its behalf by delivering or receiving interests in the global note in DTC, and making or receiving payment in accordance with normal procedures for same-day funds settlement applicable to DTC. Euroclear participants and Clearstream participants may not deliver instructions directly to the depositaries for Euroclear or Clearstream.

Because of time zone differences, the securities account of a Euroclear or Clearstream participant purchasing an interest in the global note from a DTC participant will be credited during the securities settlement processing day (which must be a business day for Euroclear or Clearstream, as the case may be) immediately following the DTC settlement date, and such credit of any transaction interests in the global note settled during such processing day will be reported to the relevant Euroclear or Clearstream participant on such day. Cash received in Euroclear or Clearstream as a result of sales of interests in the global note by or through a Euroclear or Clearstream participant to a DTC participant will be received with value on the DTC settlement date, but will be available in the relevant Euroclear or Clearstream cash account only as of the business day following settlement in DTC.

We expect that DTC will take any action permitted to be taken by a holder of notes (including the presentation of notes for exchange as described below) only at the direction of one or more participants to whose account the DTC interests in the global note is credited and only in respect of such portion of the aggregate principal amount of the notes as to which such participant or participants has or have given such direction. However, if there is an event of default under the notes, DTC will exchange the global note for notes in definitive form, which it will distribute to its participants. These notes in definitive form will be subject to certain restrictions on registration of transfers under “Notice to Investors,” and will bear the legend set forth thereunder.

Although we expect that DTC, Euroclear and Clearstream will agree to the foregoing procedures in order to facilitate transfers of interests in the global note among participants of DTC, Euroclear, and Clearstream, DTC, Euroclear and Clearstream are under no obligation to perform or continue to perform such procedures, and such procedures may be discontinued at any time. Neither we nor the trustee will have any responsibility for the performance by DTC, Euroclear or Clearstream or their participants or indirect participants of their respective obligations under the rules and procedures governing their operations.

If DTC is at any time unwilling to continue as a depositary for the global note and a successor depositary is not appointed by us within 90 days, we will issue notes in fully registered, definitive form in exchange for the global note. Such notes in definitive form will be subject to certain restrictions on registration of transfers described under “Notice to Investors,” and will bear the legend set forth thereunder.

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Reports

Whether or not required by the rules and regulations of the SEC, so long as any notes are outstanding, we will file with the SEC and furnish to the trustee all quarterly and annual financial information (without exhibits) required to be contained in a filing on Forms 10-Q and 10-K, including a “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and, with respect to the annual consolidated financial statements only, a report thereon by our independent auditors.

The Trustee

The Bank of New York Trust Company of Florida, N.A. is the trustee, security registrar, paying agent and conversion agent.

The indenture provides that, except during the continuance of an event of default, the trustee will perform only such duties as are specifically set forth in the indenture. In case an event of default shall occur (and shall not be cured) and holders of the notes have notified the trustee, the trustee will be required to exercise its powers with the degree of care and skill of a prudent person in the conduct of such person’s own affairs. Subject to such provisions, the trustee is under no obligation to exercise any of its rights or powers under the indenture at the request of any of the holders of notes, unless they shall have offered to the trustee security and indemnity satisfactory to it.

The indenture contains certain limitations on the rights of the trustee, should it become our creditor, to obtain payment of claims in certain cases or to realize on certain property received in respect of any such claim as security or otherwise. The trustee is permitted to engage in other transactions; provided, however, that if it acquires any conflicting interest, it must eliminate such conflict or resign. The Bank of New York Trust Company of Florida may in the future engage in other commercial banking transactions with us. Pursuant to the Trust Indenture Act of 1939, upon the occurrence of a default with respect to the notes, The Bank of New York Trust Company of Florida may be deemed to have a conflicting interest by virtue of its lending and other business relationships with us. In that event, The Bank of New York Trust Company of Florida would be required to resign as trustee or eliminate the conflicting interest.

No Recourse Against Others

None of our directors, officers, employees, stockholders or affiliates, as such, shall have any liability or any obligations under the notes or the indenture or for any claim based on, in respect of or by reason of such obligations or the creation of such obligations. Each holder by accepting a note waives and releases all such liability. The waiver and release are part of the consideration for the notes.

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DESCRIPTION OF CAPITAL STOCK

The following statements relating to the capital stock of Delta do not purport to be complete, and are subject to, and are qualified in their entirety by reference to, the provisions of the following documents, which are filed, or incorporated by reference, as exhibits to our Annual Report on Form 10-K for the fiscal year ended December 31, 2002: (a) Delta’s Certificate of Incorporation (the “Certificate”) and By-Laws; (b) the Certificate of Designations, Preferences and Rights of the Series D Junior Participating Preferred Stock (the “Series D Preferred Stock”) and Series B ESOP Convertible Preferred Stock (the “Series B Preferred Stock”); and (c) the Rights Agreement, dated as of October 23, 1996, as amended (the “Rights Agreement”), between Delta and Wells Fargo Minnesota Bank, N.A., as successor Rights Agent to First Chicago Trust Company of New York as Rights Agent.

General

The Certificate authorizes a total of 470,000,000 shares of capital stock, of which 450,000,000 may be shares of Common Stock and 20,000,000 may be shares of Preferred Stock.

The Preferred Stock may be issued from time to time in one or more series, without stockholder approval, with such voting powers (full or limited), designations, preferences and relative, participating, optional or other special rights, and qualifications, limitations or restrictions as shall be adopted by the board of directors. Thus, without stockholder approval, Delta could authorize the issuance of Preferred Stock with voting, conversion and other rights that could dilute the voting power and other rights of the holders of Common Stock.

As of June 30, 2003, 123,363,055 shares of Common Stock were outstanding; 57,545,673 shares of Common Stock were held in treasury; 2,250,000 shares of Series D Preferred Stock had been authorized and reserved for issuance in connection with the Rights described below; 5,940,778 shares of Series B Preferred Stock were outstanding and 10,191,405 shares of Common Stock were reserved for issuance upon the conversion of the Series B Preferred Stock; 23,663,461 shares of Common Stock were reserved for issuance under Delta’s broad-based employee stock option plans; 16,036,940 shares of Common Stock were reserved for issuance under Delta’s 2000 Performance Compensation Plan; 250,000 shares of Common Stock were reserved for issuance under Delta’s Non-Employee Directors’ Stock Option Plan; and 451,917 shares of Common Stock were reserved for issuance under Delta’s Non-Employee Directors’ Stock Plan.

Common Stock

Subject to the rights of the holders of any shares of Preferred Stock that may at the time be outstanding, record holders of Common Stock are entitled to such dividends as the board of directors may declare. Holders of Common Stock are entitled to one vote for each share held in their name on all matters submitted to a vote of stockholders and do not have preemptive rights or cumulative voting rights. Holders of the Series B Preferred Stock generally vote as a single class with the holders of Common Stock on matters upon which the Common Stock is entitled to vote and, subject to adjustment in certain circumstances, are entitled to one vote for each share of Series B Preferred Stock held in their name. Holders of Common Stock are not subject to further calls or assessments as a result of their holding shares of Common Stock.

If Delta is liquidated, the holders of shares of Common Stock are entitled to share ratably in the distribution remaining after payment of debts and expenses and of the amounts to be paid on liquidation to the holders of shares of Preferred Stock.

Wells Fargo Minnesota Bank, N.A., is the registrar and transfer agent for the Common Stock.

Shareowner Rights Plan

The Shareowner Rights Plan is designed to protect shareowners against attempts to acquire Delta that do not offer an adequate purchase price to all shareowners, or are otherwise not in the best interest of Delta and our

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shareowners. Under the plan, each outstanding share of common stock is accompanied by one-half of a preferred stock purchase right. Each whole right entitles the holder to purchase  ¹/100 of a share of Series D Junior Participating Preferred Stock at an exercise price of $300, subject to adjustment.

The rights become exercisable only after a person acquires, or makes a tender or exchange offer that would result in the person acquiring, beneficial ownership of 15% or more of our common stock. If a person acquires beneficial ownership of 15% or more of our common stock, each right will entitle its holder (other than the acquiring person) to exercise his rights to purchase our common stock having a market value of twice the exercise price.

If a person acquires beneficial ownership of 15% or more of our common stock and (1) we are involved in a merger or other business combination in which Delta is not the surviving corporation or (2) we sell more than 50% of our assets or earning power, then each right will entitle its holder (other than the acquiring person) to exercise his rights to purchase common stock of the acquiring company having a market value of twice the exercise price.

The rights expire on November 4, 2006. Delta may redeem the rights for $0.01 per right at any time before a person becomes the beneficial owner of 15% or more of our common stock. At June 30, 2003, 2,250,000 shares of preferred stock were reserved for issuance under the Shareowner Rights Plan.

The rights have certain anti-takeover effects. The rights could cause substantial dilution to a person or group that attempts to acquire Delta without conditioning the offer on redemption of the rights or on acquisition of substantially all of the rights. The rights should not, however, interfere with any merger or other business combination approved by the board of directors since the rights may be redeemed by Delta as described above.

Certain Other Provisions of the Certificate

Delaware law permits a corporation to eliminate the personal liability of its directors to the corporation or to any of 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. The Certificate provides that no director of Delta will be personally liable to Delta or its stockholders for monetary damages for any breach of his fiduciary duty as a director, except as provided by Delaware law.

As permitted by Delaware law, the Certificate permits stockholder action by written consent only if such consent is unanimous. The affirmative vote of the holders of at least 75% of Delta’s then outstanding voting stock is required to amend, alter or repeal this provision.

The Certificate also provides that any “Business Combination” involving Delta and a person (other than Delta or any subsidiary or employee benefit plan of Delta) who beneficially owns 10% or more of Delta’s voting stock (a “Related Person”) must be approved by (i) the holders of at least 75% of the votes entitled to be cast by the holders of Delta’s capital stock entitled to vote generally on the election of directors and (ii) a majority of the votes entitled to be cast by the holders of such voting stock, excluding stock beneficially owned by such Related Person (the “Voting Requirement”). The Voting Requirement does not apply if the Business Combination is approved by a majority of Continuing Directors (as defined), or complies with certain minimum price, form of consideration and other requirements. The Certificate defines Business Combination to include, among other things, (i) any merger or consolidation of Delta with, into or for the benefit of a Related Person; (ii) the sale by Delta of assets or securities to a Related Person, or any other arrangement with or for the benefit of a Related Person, which involves assets or securities valued at an amount equal to at least $15 million; (iii) the acquisition by Delta of assets or securities of a Related Person valued at an amount equal to at least $15 million; or (iv) the adoption of any plan for the liquidation or dissolution of Delta. Some of the Business Combinations to which the

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Voting Requirement would apply would not normally require stockholder approval under Delaware law. This provision of the Certificate cannot be amended, altered or repealed except by a vote similar to the Voting Requirement.

Series B Preferred Stock

General

On July 10, 1989, Delta amended its Delta Family-Care Savings Plan (the “Savings Plan”), effective July 1, 1989, to add an employee stock ownership plan feature (the “ESOP”). In connection with the establishment of the ESOP, Delta sold 6,944,450 shares of Series B Preferred Stock to the trustee of the ESOP for $72 per share, or approximately $500 million.

In order to finance the purchase of the Series B Preferred Stock, the ESOP issued $481,400,400 principal amount of Guaranteed Serial ESOP Notes (the “Guaranteed Serial ESOP Notes”). The Guaranteed Serial ESOP Notes are guaranteed by Delta.

Delta is obligated to make payments to the ESOP in order for the ESOP to make payments due under the Guaranteed Serial ESOP Notes and to fund investment elections of participants. As payments on the Guaranteed Serial ESOP Notes are made, shares of Series B Preferred Stock become available to be allocated to the participants’ accounts. All shares of Series B Preferred Stock not so credited are treated as unallocated under the Savings Plan.

The shares of Series B Preferred Stock will be held in the name of the trustee (or its nominee) until redemption or conversion, and may not be sold by the trustee or distributed outside the Savings Plan except for resale to Delta. In the event of any transfer of shares of Series B Preferred Stock to any person other than the trustee, the shares so transferred, upon such transfer, shall be automatically converted into shares of Common Stock.

Each share of Series B Preferred Stock has a stated value of $72; bears an annual cumulative cash dividend of 6% or $4.32; is convertible into 1.7155 shares of Common Stock (a conversion price of $41.97), subject to adjustment in certain circumstances; has a liquidation preference of $72, plus any accrued and unpaid dividends; generally votes together as a single class with the Common Stock on matters upon which the Common Stock is entitled to vote; and has one vote, subject to adjustment in certain circumstances. If full cumulative dividends on the Series B Preferred Stock have not been paid when due, Delta (i) may pay only ratable dividends (in proportion to the accumulated and unpaid dividends) on the Series B Preferred Stock and (ii) may not pay dividends on the Common Stock or make any payment on account of the purchase, redemption or other retirement of common stock.

As of June 30, 2003, there were issued and outstanding 5,940,778 shares of Series B Preferred Stock.

Mandatory Redemption

Delta is required to redeem shares of Series B Preferred Stock, at any time, at a redemption price (the “Alternative Redemption Price”) equal to the greater of (i) the liquidation value of the Series B Preferred Stock to be redeemed and (ii) the fair market value of the shares of Common Stock issuable upon conversion of the Series B Preferred Stock to be redeemed plus, in either case, accrued and unpaid dividends on such shares of Series B Preferred Stock, to enable the trustee to provide for distributions to participants or to satisfy investment elections by participants under the Savings Plan. Delta is also required to redeem all of the outstanding shares of Series B Preferred Stock, at the redemption prices described below in the first sentence under “Optional Redemption” if (i) the Savings Plan is terminated or (ii) the ESOP is terminated.

Delta may, at its option, pay the redemption price required upon any mandatory redemption of shares of Series B Preferred Stock in cash or shares of Common Stock (valued at fair market value), or in a combination thereof.

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Optional Redemption

The Series B Preferred Stock is redeemable, in whole or in part, at $72.00 per share, plus, in each case, an amount equal to all accrued and unpaid dividends thereon to the date fixed for redemption.

Delta may redeem the Series B Preferred Stock, in whole or in part, at a redemption price equal to the liquidation preference of the Series B Preferred Stock to be redeemed, if a change in any law or regulation has the effect of limiting or making unavailable to Delta any of the tax deductions for amounts paid on the shares of Series B Preferred Stock when such amounts are used under Section 404(k)(2) of the Internal Revenue Code of 1986, as amended (the “Code”). Delta may also redeem any or all of the Series B Preferred Stock, at its option, at the Alternative Redemption Price if the ESOP fails to qualify under Section 4975 of the Code. Upon the termination of a Savings Plan participant’s employment, Delta may elect to redeem any or all of the Series B Preferred Stock held for the account of such participant at the Alternative Redemption Price.

Delta may, at its option, pay the redemption price required upon any voluntary redemption of shares of Series B Preferred Stock in cash or in shares of Common Stock (valued at fair market value), or in a combination thereof.

Voting

The Savings Plan provides that shares of Series B Preferred Stock allocated to the account of a Savings Plan participant will be voted by the trustee in accordance with the participant’s confidential voting instructions or, if no voting instructions are received by the trustee, such shares will be voted by the trustee in its discretion. The Savings Plan further provides that shares of Series B Preferred Stock not yet allocated to any participant’s account will be voted by the trustee in proportion to the votes cast with respect to allocated shares of Series B Preferred Stock for which voting instructions are received.

Limitations on Directors’ Liability

Our certificate of incorporation eliminates the personal liability of a director to us and our stockholders for certain breaches of his or her fiduciary duty as a director to the fullest extent permitted under the General Corporation Law of the State of Delaware.

This provision offers persons who serve on our board of directors protection against awards of monetary damages resulting from certain breaches of their fiduciary duty, including grossly negligent business decisions made in connection with takeover proposals for us, and limits our ability or the ability of one of our stockholders to prosecute an action against a director for a breach of fiduciary duty.

Indemnification of Officers and Directors

Our by-laws provide that we will indemnify any of our officers or directors to the fullest extent permitted by the General Corporation Law of the State of Delaware against all expenses, liability and loss incurred in connection with any action, suit or proceeding in which any such person may be involved by reason of the fact that he or she is or was our director or officer. In addition, the board of directors, in its discretion, may indemnify any other person, other than a director or officer, by reason of the fact that such person is or was our employee or agent. We carry insurance policies in standard form indemnifying our directors and officers against liabilities arising from certain acts performed by them in their capacities as our directors and officers. These policies also indemnify us for any sums we may be required or permitted to pay by law to our directors and officers as indemnification for expenses they may have incurred.

Exchange Listing

Our common stock is listed on the New York Stock Exchange under the symbol “DAL.”

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SELLING SECURITYHOLDERS

We originally issued the securities in a private placement in June 2003. The notes were resold by the initial purchasers to qualified institutional buyers within the meaning of Rule 144A under the Securities Act in transactions exempt from registration under the Securities Act. The notes and the underlying common stock that may be offered with this prospectus will be offered by the selling securityholders, which includes their transferees, pledgees or donees or their successors. The following table sets forth certain information concerning the principal amount of notes beneficially owned by each selling securityholder and the number of shares of underlying common stock that may be offered from time to time with this prospectus.

The number of shares of common stock shown in the table below assumes conversion of the full amount of notes held by such holder at the initial conversion rate of 35.7143 shares per $1,000 principal amount of securities. This conversion rate is subject to certain adjustments. Accordingly, the number of shares of common stock issuable upon conversion of the securities may increase or decrease from time to time. Under the terms of the indenture, fractional shares will not be issued upon conversion of the debt securities. Cash will be paid instead of fractional shares, if any.

We have prepared the table below based on information given to us by the selling securityholders on or prior to the date of this prospectus. However, any or all of the notes or the common stock listed below may be offered for sale with this prospectus by the selling securityholders from time to time. Accordingly, no estimate can be given as to the amount of notes or common stock that will be held by the selling securityholders upon consummation of any sales. In addition, the selling securityholders listed in the table below may have acquired, sold or transferred, in transactions exempt from the registration requirements of the Securities Act, some or all of their securities since the date this information was last provided to us.

Information about the selling securityholders may change over time. Any changed information will be set forth in prospectus supplements. From time to time, additional information concerning ownership of the notes and the common stock may rest with holders of notes or the common stock not named in the table below and of whom we are unaware.

Name of Selling Securityholder	Principal Amount of Notes Beneficially Owned That May Be Sold	Percentage of Notes Outstanding	Number of Shares of Common Stock That May be Sold	Percentage of Common Stock Outstanding
Sub Total
All other holders of debt securities of future transferees, pledgees, donees, assignees or successors of any of those holders
Total

None of the selling securityholders has, or within the past three years has had, any position, office or other material relationship with us or any of our predecessors or affiliate except as set forth below. J.P. Morgan Securities Inc. was the initial purchaser in connection with the private placement of the notes and have, along with certain of their affiliates, engaged and may engage in investment banking transactions with us.

Only selling securityholders identified above who beneficially own the securities set forth opposite each such selling securityholders’s name in the foregoing table on the effective date of the registration statement of which this prospectus forms a part may sell such securities under the registration statement. Prior to any use of this prospectus in connection with an offering of the notes and/or the underlying common stock by any holder not identified above, this prospectus will be supplemented to set forth the name and other information about the selling securityholder intending to sell such notes and the underlying common stock. The prospectus supplement will also disclose whether any selling securityholder selling in connection with such prospectus supplement has held any position or office with, been employed by or otherwise has had a material relationship with, us or any of our affiliates during the three years prior to the date of the prospectus supplement if such information has not been disclosed in this prospectus.

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CERTAIN U.S. FEDERAL INCOME TAX CONSEQUENCES

The following are the material U.S. federal tax consequences of ownership and disposition of the notes and, with respect to Non-U.S. Holders (as defined below), of common stock. This discussion applies only to notes:

• purchased by initial holders who purchase notes at the “issue price,” which will equal the first price to the public (not including bond houses, brokers or similar persons or organizations acting in the capacity of underwriters, placement agents or wholesalers) at which a substantial amount of the notes is sold for money; and

• held as capital assets.

This discussion does not describe all of the tax consequences that may be relevant to a holder in light of his particular circumstances or to holders subject to special rules, such as:

• certain financial institutions;

• insurance companies;

• dealers in securities or foreign currencies;

• persons holding notes as part of a hedge;

• U.S. Holders (as defined below) whose functional currency is not the U.S. dollar;

• partnerships or other entities classified as partnerships for U.S. federal income tax purposes;

• persons subject to the alternative minimum tax; and

• persons that own, or are deemed to own, more than 5% of the common stock of Delta or who, on the date of acquisition of the notes, own notes with a fair market value of more than 5% of the fair market value of the common stock of Delta.

This summary is based on the Code, administrative pronouncements, judicial decisions and final, temporary and proposed Treasury Regulations, changes to any of which subsequent to the date of this prospectus may affect the tax consequences described herein. Persons considering the purchase of notes are urged to consult their tax advisors with regard to the application of the U.S. federal income tax laws to their particular situations as well as any tax consequences arising under the laws of any state, local or foreign taxing jurisdiction.

Tax Consequences to U.S. Holders

As used herein, the term “U.S. Holder” means a beneficial owner of a note that is, for U.S. federal income tax purposes:

• a citizen or resident of the United States;

• a corporation, or other entity taxable as a corporation for U.S. federal income tax purposes, created or organized in or under the laws of the United States or of any political subdivision thereof; or

• an estate or trust the income of which is subject to U.S. federal income taxation regardless of its source.

The term “U.S. Holder” also includes certain former citizens and residents of the United States.

Payments of Interest

It is expected that the notes will be issued without original issue discount for U.S. federal income tax purposes. Accordingly, interest paid on a note will be taxable to a U.S. Holder as ordinary interest income at the time it accrues or is received in accordance with the Holder’s method of accounting for federal income tax purposes.

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If, however, the “stated redemption price at maturity” of the notes (generally, the sum of all payments required under the note other than payments of stated interest) exceeds their issue price by more than a de minimis amount, a U.S. Holder will be required to include such excess in gross income as original issue discount, as it accrues, in accordance with a constant-yield method based on a compounding of interest, prior to the receipt of cash payments attributable to this income.

Sale, Exchange, Redemption or Retirement of the Notes

Upon the sale, exchange, redemption or retirement of a note (other than a conversion into common stock), a U.S. Holder will recognize taxable gain or loss equal to the difference between the amount realized on the sale, exchange, redemption or retirement and the Holder’s adjusted tax basis in the note. For these purposes, the amount realized does not include any amount attributable to accrued and unpaid interest. Amounts attributable to accrued and unpaid interest are treated as interest, as described under “Payments of Interest” above. Gain or loss realized on the sale, exchange, redemption or retirement of a note will generally be capital gain or loss and will be long-term capital gain or loss if at the time of sale, exchange, redemption or retirement the note has been held for more than one year. The deductibility of capital losses is subject to limitations.

Conversion into Common Stock

A U.S. Holder’s conversion of a note into common stock will not be a taxable event, except that the receipt of cash in lieu of a fractional share of common stock will result in capital gain or loss (measured by the difference between the cash received in lieu of the fractional share and the U.S. Holder’s tax basis attributable to the fractional share, as described in the next paragraph), and the fair market value of common stock received with respect to accrued and unpaid interest will be taxed as a payment of interest (as described above).

A U.S. Holder’s tax basis in common stock received upon a conversion of a note will be the same as the U.S. Holder’s basis in the note at the time of conversion, reduced by any basis allocated to a fractional share and increased, for a cash method Holder, by the amount of income recognized with respect to accrued interest. The U.S. Holder’s holding period for the common stock received will include the Holder’s holding period for the note converted, except that the holding period of any common stock received with respect to accrued and unpaid interest will commence on the day after the date of conversion.

Constructive Dividends

If Delta were to make a distribution of property to stockholders (for example, distributions of evidences of indebtedness or assets, but generally not stock dividends or rights to subscribe for Delta’s common stock) and the conversion price underlying the notes were decreased pursuant to the anti-dilution provisions of the indenture, such decrease would be deemed to be a distribution to U.S. Holders. In addition, any other decrease in the conversion price of the notes may, depending on the circumstances, be deemed to be a distribution to U.S. Holders. Any such deemed distribution will be taxed in the same manner as an actual distribution. In certain circumstances, the failure to make an adjustment of the conversion price under the indenture may result in a taxable distribution to holders of Delta’s common stock.

Backup Withholding and Information Reporting

Information returns will be filed with the Internal Revenue Service in connection with payments on the notes and the proceeds from a sale or other disposition of the notes. A U.S. Holder will be subject to U.S. backup withholding tax on these payments if the U.S. Holder fails to provide its taxpayer identification number to the paying agent and comply with certain certification procedures or otherwise establish an exemption from backup withholding. The amount of any backup withholding from a payment to a U.S. Holder will be allowed as a credit against the U.S. Holder’s U.S. federal income tax liability and may entitle the U.S. Holder to a refund, provided that the required information is timely furnished to the Internal Revenue Service.

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Tax Consequences to Non-U.S. Holders

As used herein, the term “Non-U.S. Holder” means a beneficial owner of a note that is, for U.S. federal income tax purposes:

• an individual who is classified as a nonresident alien for U.S. federal income tax purposes;

• a foreign corporation; or

• a foreign estate or trust.

“Non-U.S. Holder” does not include an individual who is present in the United States for 183 days or more in the taxable year of disposition of the notes or common stock but is not otherwise a resident of the United States for U.S. federal income tax purposes. Such an individual is urged to consult his or her own tax advisor regarding the U.S. federal income tax consequences of the sale, exchange or other disposition of the notes or common stock.

Payments on the Notes

Subject to the discussion below concerning backup withholding, payments of principal and interest (including original issue discount, if any) on the notes by Delta or any paying agent to any Non-U.S. Holder will not be subject to U.S. federal withholding tax, provided that, in the case of interest:

• the Holder does not own, actually or constructively, 10 percent or more of the total combined voting power of all classes of stock of Delta entitled to vote and is not a controlled foreign corporation, as defined in the Code, related, directly or indirectly, to Delta through stock ownership; and

• the certification requirement described below has been fulfilled with respect to the beneficial owner, as discussed below.

Certification Requirement

Interest with respect to a note will not be exempt from withholding tax unless the beneficial owner of the note certifies on Internal Revenue Service Form W-8BEN, under penalties of perjury, that it is not a U.S. person.

If a Non-U.S. Holder of a note is engaged in a trade or business in the United States, and if interest on the note is effectively connected with the conduct of this trade or business, the Non-U.S. Holder, although exempt from the withholding tax discussed in the preceding paragraphs, will generally be taxed in the same manner as a U.S. Holder (see “Tax Consequences to U.S. Holders” above), except that the Holder will be required to provide a properly executed Internal Revenue Service Form W-8ECI in order to claim an exemption from withholding tax. These holders are urged to consult their own tax advisors with respect to other U.S. tax consequences of the ownership and disposition of notes, including, in the case of corporations, the possible imposition of a 30% branch profits tax (or an applicable lower treaty rate).

Payments of interest on the notes that do not meet the foregoing requirements generally will be subject to U.S. federal withholding tax at a rate of 30% (or a lower applicable treaty rate, provided certain certification requirements are met).

Sale, Exchange or Other Disposition of Notes or Shares of Common Stock

Subject to the discussion below concerning backup withholding, a Non-U.S. Holder generally will not be subject to U.S. federal income tax (or any withholding thereof) on gain realized on a sale or other disposition of notes or common stock, unless:

• the gain is effectively connected with a trade or business of the Non-U.S. Holder in the United States; or

• Delta is or has been a U.S. real property holding corporation, as defined in the Code, at any time within the five-year period preceding the disposition or the Non-U.S. Holder’s holding period, whichever period is shorter, and the common stock has ceased to be traded on an established securities market prior to the beginning of the calendar year in which the sale or disposition occurs.

Delta does not believe that it is, and does not anticipate becoming, a U.S. real property holding corporation.

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Conversion into Common Stock

A Non-U.S. Holder’s conversion of a note into common stock will not be a taxable event. However, to the extent that a Non-U.S. Holder receives cash in lieu of a fractional share upon conversion, any gain upon the receipt of cash would be subject to the rules described above regarding the sale or exchange of common stock.

Dividends

Dividends (including deemed dividends on the notes described above under “Tax Consequences to U.S. Holders—Constructive Dividends”) paid to a Non-U.S. Holder of common stock generally will be subject to withholding tax at a 30% rate or a reduced rate specified by an applicable income tax treaty. In order to obtain a reduced rate of withholding, a Non-U.S. Holder will be required to provide an Internal Revenue Service Form W-8BEN certifying its entitlement to benefits under a treaty.

The withholding tax does not apply to dividends paid to a Non-U.S. Holder who provides a Form W-8ECI, certifying that the dividends are effectively connected with the Non-U.S. Holder’s conduct of a trade or business within the United States. Instead, the effectively connected dividends will be subject to regular U.S. income tax as if the Non-U.S. Holder were a U.S. Holder. A non-U.S. corporation receiving effectively connected dividends may also be subject to an additional “branch profits tax” imposed at a rate of 30% (or a lower treaty rate).

Federal Estate Tax

A note held by an individual may be subject to U.S. federal estate tax as a result of the individual’s death if the individual:

• was a U.S. Holder; or

• owned, actually or constructively, 10% or more of the total combined voting power of all classes of stock of Delta entitled to vote and, at the time of the individual’s death, payments on the note would have been effectively connected to the conduct by the holder of a trade or business in the United States.

An individual non-U.S. Holder who is treated as the owner of, or has made certain lifetime transfers of, an interest in Delta’s common stock will be required to include the value of the stock in his gross estate for U.S. federal estate tax purposes, and may be subject to U.S. federal estate tax unless an applicable estate tax treaty provides otherwise.

Backup Withholding and Information Reporting

Information returns will be filed with the U.S. Internal Revenue Service in connection with payments on the notes and dividends on the common stock. Unless the Non-U.S. Holder complies with certification procedures to establish that it is not a U.S. person, information returns may be filed with the U.S. Internal Revenue Service in connection with the proceeds from a sale or other disposition of the notes and common stock and the Non-U.S. Holder may be subject to U.S. backup withholding tax on payments on the notes or on dividends or the proceeds from a sale or other disposition of the notes or common stock. The certification procedures required to claim the exemption from withholding tax on interest described above will satisfy the certification requirements necessary to avoid the backup withholding tax as well. The amount of any backup withholding from a payment to a Non-U.S. Holder will be allowed as a credit against the Non-U.S. Holder’s U.S. federal income tax liability and may entitle the Non-U.S. Holder to a refund, provided that the required information is timely furnished to the Internal Revenue Service.

Nonconfidentiality

Effective from the date of commencement of discussions concerning the offering described herein, you and each of your employees, representatives, or other agents may disclose to any and all persons, without limitation of any kind, the tax treatment and tax structure of the transaction described herein and all materials of any kind, including opinions or other tax analyses, that have been provided to you relating to such tax treatment and tax structure. However, the foregoing does not constitute an authorization to disclose the identity of Delta or the initial purchaser or their respective affiliates, agents or advisers, or, except to the extent relating to such tax structure or tax treatment, any specific pricing terms or commercial or financial information.

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PLAN OF DISTRIBUTION

We will not receive any of the proceeds of the sale of the notes and the underlying common stock offered by this prospectus. The aggregate proceeds to the selling securityholders from the sale of the notes or underlying common stock will be the purchase price of the notes or underlying common stock less any discounts and commissions. A selling securityholder reserves the right to accept and, together with their agents, to reject, any proposed purchase of notes or common stock to be made directly or through agents.

The notes and the underlying common stock may be sold from time to time to purchasers:

• directly by the selling securityholders and their successors, which includes their transferees, pledgees or donees or their successors, or

• through underwriters, broker-dealers or agents who may receive compensation in the form of discounts, concessions or commissions from the selling securityholders or the purchasers of the notes and the underlying common stock. These discounts, concessions or commissions may be in excess of those customary in the types of transactions involved.

The selling securityholders and any underwriters, broker-dealers or agents who participate in the distribution of the debt securities and the underlying common stock may be deemed to be “underwriters” within the meaning of Section 2(11) of the Securities Act. Any selling securityholder which is a broker-dealer or an affiliate of a broker-dealer will be deemed to be an “underwriter” within the meaning of Section 2(11) of the Securities Act, unless such selling securityholder purchased in the ordinary course of business; and at the time of its purchase of the notes to be resold, did not have any agreements or understandings, directly or indirectly, with any person to distribute the notes. As a result, any profits on the sale of the notes and the underlying common stock by selling securityholders who are deemed to be underwriters and any discounts, commissions or concessions received by any such broker-dealers or agents who are deemed to be underwriters will be deemed to be underwriting discounts and commissions under the Securities Act. Selling securityholders who are deemed to be “underwriters” within the meaning of Section 2(11) of the Securities Act will be subject to prospectus delivery requirements of the Securities Act and to certain statutory liabilities, including, but not limited to, those relating to Sections 11, 12 and 17 of the Securities Act and Rule l0b-5 under the Exchange Act. To our knowledge, none of the selling securityholders who are broker-dealers or affiliates of broker-dealers, other than the initial purchasers, purchased the notes outside of the ordinary course of business or, at the time of the purchase of the notes, had any agreements or understandings, directly or indirectly, with any person to distribute the notes.

If the notes and the underlying common stock are sold through underwriters or broker-dealers, the selling securityholders will be responsible for underwriting discounts or commissions or agent’s commissions.

The notes and the underlying common stock may be sold in one or more transactions at:

• fixed prices;

• prevailing market prices at the time of sale;

• prices related to such prevailing market prices;

• varying prices determined at the time of sale; or

• negotiated prices.

These sales may be effected in transactions:

• on any national securities exchange or quotation service on which the debt securities and underlying common stock may be listed or quoted at the time of the sale, including the New York Stock Exchange in the case of the common stock;

• in the over-the-counter market;

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• in transactions otherwise than on such exchanges or services or in the over-the-counter market; or

• through the writing of options, whether such options are listed on an options exchange or otherwise through the settlement of short sales.

These transactions may include block transactions or crosses. Crosses are transactions in which the same broker acts as an agent on both sides of the trade.

In connection with the sales of the notes and the underlying common stock or otherwise, the selling securityholders may enter into hedging transactions with broker-dealers or other financial institutions. These broker-dealers or other financial institutions may in turn engage in short sales of the note or the underlying common stock in the course of hedging their positions. The selling securityholders may also (1) sell the notes and underlying common stock short and delivery notes and the underlying common stock to close out short positions, or (2) loan or pledge debt securities or the underlying common stock to broker-dealers that in turn may sell the notes and the underlying common stock.

A short sale of the notes or the underlying common stock by a broker-dealer, financial institution or selling securityholder would involve the sale of such notes or underlying common stock that are not owned, and therefore must be borrowed, in order to make delivery of the security in connection with such sale. In connection with a short sale of the notes or the underlying common stock a broker-dealer, financial institution or selling securityholder may purchase the notes or our common stock on the open market to cover positions created by short sales. In determining the source of the notes or shares of common stock to close out such short positions, the broker-dealer, financial institution or selling securityholders may consider, among other things, the price of shares of the notes or common stock available for purchase in the open market.

At the time a particular offering of the securities is made, if required, a prospectus supplement will be distributed, which will set forth the names of the selling securityholders, the aggregate amount and type of securities being offered and the terms of the offering, including, to the extend required, (1) the name or names of any underwriters, broker-dealers or agents, (2) any discounts, commissions and other terms constituting compensation from the selling securityholders and (3) any discounts, commissions or concessions allowed or reallowed to be paid to broker-dealers.

To our knowledge, there are currently no plans, arrangements or understandings between any selling securityholder and any underwriter, broker-dealer or agent regarding the sale of the notes and the underlying common stock by the selling securityholders.

Our common stock trades on the New York Stock Exchange under the symbol “DAL.” We do not intend to apply for listing of the notes on any securities exchange or for quotation through Nasdaq. Accordingly, no assurances can be given as to the development of liquidity or any trading market for the notes. See “Risk Factors—Risk Factors relating to the Offering.”

We cannot assure you that any selling securityholder will sell any or all of the notes or the underlying common stock with this prospectus. Further, we cannot assure you that any such selling securityholder will not transfer, devise or gift the notes and the underlying common stock by other means not described in this prospectus. In addition, any notes or underlying common stock covered by this prospectus that qualify for sale under Rule 144 or Rule 144A of the Securities Act may be sold under Rule 144 or Rule 144A rather than under this prospectus. The notes and the underlying common stock may be sold in some states only through registered or licensed brokers or dealers. In addition, in some states the notes and underlying common stock may not be sold unless they have been registered or qualified for sale or the sale is entitled to an exemption from registration.

The selling securityholders and any other person participating in the sale of notes or the underlying common stock will be subject to the Exchange Act. The Exchange Act rules include, without limitation, Regulation M, which may limit the timing of purchases and sales of any of the notes and the underlying common stock by the

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selling securityholders and any other such person. In addition, Regulation M of the Exchange Act may restrict the ability of any person engaged in the distribution of the notes and the underlying common stock to engage in market-making activities with respect to the particular notes and the underlying common stock being distributed for a period of up to five business days before the commencement of such distribution. This may affect the marketability of the notes and the underlying common stock and the ability of any person or entity to engage in market-making activities with respect to the notes and the underlying common stock.

Under the registration rights agreement filed as an exhibit to the registration statement of which this prospectus is a part, we and the selling securityholders will be indemnified by the other against certain liabilities, including certain liabilities under the Securities Act, or will be entitled to contribution in connection with these liabilities.

We have agreed to pay substantially all of the expenses incidental to the registration, offering and sale of the notes and underlying common stock to the public other than commissions, fees and discounts of underwriters, brokers, dealers and agents.

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VALIDITY OF THE SECURITIES

The validity of the notes and of the shares of common stock issuable upon the conversion thereof and certain other legal matters will be passed upon for us by Davis Polk & Wardwell, New York, New York.

EXPERTS

The consolidated balance sheet as of December 31, 2001 and the related consolidated statements of operations, cash flows and shareowners’ equity for each of the years ended December 31, 2001 and 2000 and related schedules incorporated by reference in this prospectus have been audited by Arthur Andersen LLP, independent public accountants, as indicated in their reports with respect thereto, and are included herein in reliance upon the authority of said firm as experts in accounting and auditing in giving said reports. Reference is made to said report, which includes an explanatory paragraph with respect to the change in the methods of accounting for derivative instruments and hedging activities as discussed in Note 4 to the audited consolidated financial statements. Arthur Andersen LLP has ceased operations in the United States.

On March 6, 2002, Delta’s board of directors decided to retain Deloitte & Touche LLP as Delta’s independent public accountants and dismissed Arthur Andersen LLP, Delta’s former auditors. There were no disagreements with the former auditors on any matter of accounting principles or practices, financial statement disclosure or auditing scope or procedure at the time of the change or with respect to Delta’s financial statements for fiscal years 2000 and 2001, which, if not resolved to the former auditor’s satisfaction, would have caused them to make reference to the subject matter of the disagreement in connection with their report. Prior to retaining Deloitte & Touche LLP, Delta had not consulted with Deloitte & Touche LLP regarding accounting principles.

The consolidated balance sheet as of December 31, 2002 and the related consolidated statements of operations, cash flows and shareowners’ equity for the year ended December 31, 2002, incorporated by reference in this prospectus from Delta’s Annual Report on Form 10-K for the year ended December 31, 2002, have been audited by Deloitte & Touche LLP, independent auditors, as stated in their report (which report expresses an unqualified opinion and includes explanatory paragraphs relating to (1) the Company’s change in its method of accounting for goodwill and other intangible assets to conform with Statement of Financial Accounting Standards No. 142 and (2) the application of procedures relating to certain revised disclosures in Notes 5, 9, 17 and 21 related to the 2001 and 2000 consolidated financial statements that were audited by other auditors who have ceased operations and for which Deloitte & Touche LLP have expressed no opinion or other form of assurance other than with respect to such disclosures), which is also incorporated herein by reference, and have been so incorporated in reliance upon the report of such firm given upon their authority as experts in accounting and auditing.

With respect to the unaudited interim financial information for the periods ended March 31, 2003 and 2002 and June 30, 2003 and 2002, which is incorporated herein by reference, Deloitte & Touche LLP have applied limited procedures in accordance with professional standards for a review of such information. However, as stated in their reports included in Delta’s Quarterly Reports on Form 10-Q for the quarters ended March 31, 2003 and June 30, 2003 and incorporated by reference herein, they did not audit and they do not express an opinion on that interim financial information. Accordingly, the degree of reliance on their reports on such information should be restricted in light of the limited nature of the review procedures applied. Deloitte & Touche LLP are not subject to the liability provisions of Section 11 of the Securities Act for their reports on the unaudited interim financial information because those reports are not “reports” or a “part” of the Registration Statement prepared or certified by an accountant within the meaning of Sections 7 and 11 of the Act.

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PART II

INFORMATION NOT REQUIRED IN PROSPECTUS

Item 14.    Other Expenses of Issuance and Distribution

The following table sets forth the costs and expenses payable by the Registrant in connection with the sale of the securities being registered hereby. All amounts are estimates except the registration fee.

	Amount to be Paid
Registration fee	$	28,315
Printing		25,000
Legal fees and expenses (including Blue Sky fees)		75,000
Trustee fees and expenses		2,500
Accounting fees and expenses		30,000
Miscellaneous		500
TOTAL	$	161,315

Item 15.    Indemnification of Directors and Officers

Section 145 of the Delaware General Corporation Law provides that a corporation may indemnify directors and officers as well as other employees and individuals against expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by such person in connection with any threatened, pending or completed actions, suits or proceedings in which such person is made a party by reason of such person being or having been a director, officer, employee or agent to the Registrant. The Delaware General Corporation Law provides that Section 145 is not exclusive of other rights to which those seeking indemnification may be entitled under any bylaw, agreement, vote of stockholders or disinterested directors or otherwise. The Registrant’s Bylaws provides for indemnification by the Registrant of any of its officers or directors to the fullest extent permitted by the Delaware General Corporation Law against all expenses, liability and loss incurred in connection with any action, suit or proceeding in which any such person may be involved by reason of the fact that he or she is or was a director or officer. In addition, the board of directors, in its discretion, may indemnify any other person, other than a director or officer, by reason of the fact that such person is or was an employee or agent.

Section 102(b)(7) of the Delaware General Corporation Law permits a corporation to provide in its certificate of incorporation that a director of the corporation shall not be personally liable to the corporation or its stockholders for monetary damages for breach of fiduciary duty as a director, except for liability (i) for any breach of the director’s duty of loyalty to the corporation or its stockholders, (ii) for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (iii) for unlawful payments of dividends or unlawful stock repurchases, redemptions or other distributions, or (iv) for any transaction from which the director derived an improper personal benefit. The Registrant’s Certificate of Incorporation provides for such limitation of liability.

The Registrant maintains standard policies of insurance under which coverage is provided (a) to its directors and officers against loss rising from claims made by reason of breach of duty or other wrongful act, and (b) to the Registrant with respect to payments which may be made by the Registrant to such officers and directors pursuant to the above indemnification provision or otherwise as a matter of law.

II-1

Item 16.    Exhibits and Financial Statement Schedules

(a)    The following exhibits are filed as part of this Registration Statement:

Exhibit No.	Document
4.1	Rights Agreement dated as of October 24, 1996, between Delta and First Chicago Trust Company of New York, as Rights Agent, as amended by Amendment No. 1 thereto dated as of July 22, 1999 (filed as Exhibit 1 to Delta’s Form 8-A/A Registration Statement dated November 4, 1996, and Exhibit 3 to Delta’s Amendment No. 1 to Form 8-A/A Registration Statement dated July 30, 1999)
4.2	Indenture dated as of June 2, 2003 between Delta and The Bank of New York Trust Company of Florida, NA, as Trustee, relating to $350 million principal amount of 8.00% Convertible Senior Notes due 2023
5.1	Opinion of Davis Polk & Wardwell
12.1	Statement regarding computation of ratio of earnings to fixed charges for each year in the five-year period ended December 31, 2002 (filed as Exhibit 12 to Delta’s Annual Report on Form 10-K for the year ended December 31, 2002)
12.2	Statement regarding computation of ratio of earnings to fixed charges for the six months ended June 30, 2003 and 2002 (filed as Exhibit 12 to Delta’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2003)
15.1	Letter from Deloitte & Touche LLP regarding unaudited interim financial information
23.1	Consent of Deloitte & Touche LLP
23.2	Consent of Davis Polk & Wardwell (included in Exhibit 5.1)
24.1	Powers of Attorney
25.1	Statement of Eligibility of Bank of New York Trust Company of Florida for Indenture under the Trust Indenture Act of 1939 on Form T-1

Item 17.    Undertakings

(a)    The undersigned Registrant hereby undertakes:

(1)    To file, during any period in which offers or sales are being made of securities registered hereby, 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. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Securities and Exchange Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than a 20 percent change in the maximum aggregate offering price set forth in the “Calculation of Registration Fee” table in the effective 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 (i) and (ii) above do not apply if the information required to be included in a post-effective amendment by those paragraphs is contained in periodic reports filed by

II-2

the registrant pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934 that are incorporated by reference in this registration statement.

(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 herein, 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) The undersigned Registrant hereby undertakes 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 registrants pursuant to the foregoing provisions, or otherwise, the registrants have 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 registrants will, unless in the opinion of their 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.

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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-3 and has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Atlanta, State of Georgia, on August 22, 2003.

DELTA AIR LINES, INC.
By:	/s/ M. Michele Burns
	M. Michele Burns Executive Vice President and Chief Financial Officer

Pursuant to the requirements of the Securities Act of 1933, as amended, this registration statement has been signed by the following persons in the capacities indicated on the 22nd day of August, 2003.

	Signature	Title
* Leo F. Mullin		Chairman of the Board and Chief Executive Officer (Principal Executive Officer)
* Edward H. Budd		Director
* George M. C. Fisher		Director
* David R. Goode		Director
* Gerald Grinstein		Director
* James M. Kilts		Director
* John F. Smith, Jr.		Director
* Joan E. Spero		Director
* Andrew J. Young		Director
*By:	/s/ M. Michele Burns	Attorney-in-Fact
M. Michele Burns

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EXHIBIT INDEX

Exhibit No.	Document
4.1	Rights Agreement dated as of October 24, 1996, between Delta and First Chicago Trust Company of New York, as Rights Agent, as amended by Amendment No. 1 thereto dated as of July 22, 1999 (filed as Exhibit 1 to Delta’s Form 8-A/A Registration Statement dated November 4, 1996, and Exhibit 3 to Delta’s Amendment No. 1 to Form 8-A/A Registration Statement dated July 30, 1999)
4.2	Indenture dated as of June 2, 2003 between Delta and The Bank of New York Trust Company of Florida, NA, as Trustee, relating to $350 million principal amount of 8.00% Convertible Senior Notes due 2023
5.1	Opinion of Davis Polk & Wardwell
12.1	Statement regarding computation of ratio of earnings to fixed charges for each year in the five-year period ended December 31, 2002 (filed as Exhibit 12 to Delta’s Annual Report on Form 10-K for the year ended December 31, 2002)
12.2	Statement regarding computation of ratio of earnings to fixed charges for the six months ended June 30, 2003 and 2002 (filed as Exhibit 12 to Delta’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2003)
15.1	Letter from Deloitte & Touche LLP regarding unaudited interim financial information
23.1	Consent of Deloitte & Touche LLP
23.2	Consent of Davis Polk & Wardwell (included in Exhibit 5.1)
24.1	Powers of Attorney
25.1	Statement of Eligibility of Bank of New York Trust Company of Florida for Indenture under the Trust Indenture Act of 1939 on Form T-1

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EX-4.2

EXHIBIT 4.2

DELTA AIR LINES, INC.

and

THE BANK OF NEW YORK TRUST COMPANY OF FLORIDA, N.A.

as Trustee

8.00% Convertible Senior Notes due 2023

INDENTURE

Dated as of June 2, 2003

TABLE OF CONTENTS

	Page
ARTICLE 1
DEFINITIONS
SECTION 1.01 Definitions	1
SECTION 1.02 Other Definitions	6
SECTION 1.03 Incorporation by Reference of Trust Indenture Act	6
SECTION 1.04 Rules of Construction	7
ARTICLE 2
THE CONVERTIBLE SENIOR NOTES
SECTION 2.01 Form	7
SECTION 2.02 Execution and Authentication	8
SECTION 2.03 Registrar, Paying Agent and Conversion Agent	9
SECTION 2.04 Paying Agent to Hold Money in Trust	9
SECTION 2.05 Holder Lists	9
SECTION 2.06 Transfer and Exchange	10
SECTION 2.07 Replacement Convertible Senior Notes	11
SECTION 2.08 Outstanding Convertible Senior Notes	12
SECTION 2.09 When Treasury Convertible Senior Notes Disregarded	13
SECTION 2.10 Temporary Convertible Senior Notes	13
SECTION 2.11 Cancellation	13
SECTION 2.12 Defaulted Interest	14
SECTION 2.13 CUSIP Number	15
SECTION 2.14 Restrictions on Transfer	15
ARTICLE 3
COVENANTS
SECTION 3.01 Payments on the Notes	15
SECTION 3.02 Commission Reports	15
SECTION 3.03 Compliance Certificate	16
SECTION 3.04 Maintenance of Office or Agency	16
SECTION 3.05 Continued Existence	16
SECTION 3.06 Appointments to Fill Vacancies in Trustee’s Office	16
SECTION 3.07 Stay, Extension and Usury Laws	17
SECTION 3.08 Taxes	17
SECTION 3.09 Investment Company Act	17

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ARTICLE 4
REDEMPTION AND PURCHASE
SECTION 4.01 Right to Redeem; Notices to Trustee	17
SECTION 4.02 Selection of Notes to Be Redeemed	18
SECTION 4.03 Notice of Redemption	18
SECTION 4.04 Effect of Notice of Redemption	19
SECTION 4.05 Deposit of Redemption Price	19
SECTION 4.06 Notes Redeemed in Part	19
SECTION 4.07 Arrangement on Call for Redemption	20
SECTION 4.08 Purchase of Notes at the Option of the Holders	20
SECTION 4.09 Repurchase at the Option of Holders Upon Designated Event	22
SECTION 4.10 Effect of Purchase Notice or Designated Event Repurchase Notice	25
SECTION 4.11 Deposit of Purchase Price or Designated Event Repurchase Price	26
SECTION 4.12 Notes Purchased in Part	26
SECTION 4.13 Covenant to Comply with Securities Laws upon Purchase of Convertible Senior Notes	27
SECTION 4.14 Repayment to the Company	27
ARTICLE 5
SUCCESSORS
SECTION 5.01 Company May Consolidate, etc., Only on Certain Terms	27
SECTION 5.02 Successor Corporation Substituted	28
SECTION 5.03 Repurchase at the Option of Holders upon Designated Event	28
ARTICLE 6
DEFAULTS AND REMEDIES
SECTION 6.01 Events of Default	29
SECTION 6.02 Acceleration	30
SECTION 6.03 Other Remedies	30
SECTION 6.04 Waiver of Past Defaults	31
SECTION 6.05 Control by Majority	31
SECTION 6.06 Limitation on Suits	31
SECTION 6.07 Rights of Holders to Receive Payment	32
SECTION 6.08 Collection Suit by Trustee	32
SECTION 6.09 Trustee May File Proofs of Claim	32
SECTION 6.10 Priorities	32
SECTION 6.11 Undertaking for Costs	33

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ARTICLE 7
THE TRUSTEE
SECTION 7.01 Duties of the Trustee	33
SECTION 7.02 Rights of the Trustee	34
SECTION 7.03 Individual Rights of the Trustee	36
SECTION 7.04 Trustee’s Disclaimer	36
SECTION 7.05 Notice of Defaults	36
SECTION 7.06 Reports by the Trustee to Holders	36
SECTION 7.07 Compensation and Indemnity	37
SECTION 7.08 Replacement of the Trustee	38
SECTION 7.09 Successor Trustee by Merger, etc.	39
SECTION 7.10 Eligibility, Disqualification	39
SECTION 7.11 Preferential Collection of Claims Against Company	39
ARTICLE 8
SATISFACTION AND DISCHARGE OF INDENTURE
SECTION 8.01 Discharge of Indenture	39
SECTION 8.02 Deposited Monies to Be Held in Trust by Trustee	40
SECTION 8.03 Paying Agent to Repay Monies Held	40
SECTION 8.04 Return of Unclaimed Monies	40
SECTION 8.05 Reinstatement	41
ARTICLE 9
AMENDMENTS
SECTION 9.01 Without the Consent of Holders	41
SECTION 9.02 With the Consent of Holders	42
SECTION 9.03 Compliance with the Trust Indenture Act	43
SECTION 9.04 Revocation and Effect of Consents	43
SECTION 9.05 Notation on or Exchange of Convertible Senior Notes	44
SECTION 9.06 Trustee Protected	44

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ARTICLE 10
GENERAL PROVISIONS
SECTION 10.01 Trust Indenture Act Controls		44
SECTION 10.02 Notices		44
SECTION 10.03 Communication by Holders with Other Holders		45
SECTION 10.04 Certificate and Opinion as to Conditions Precedent		45
SECTION 10.05 Statements Required in Certificate or Opinion		45
SECTION 10.06 Rules by Trustee and Agents		46
SECTION 10.07 Legal Holidays		46
SECTION 10.08 No Recourse Against Others		47
SECTION 10.09 Counterparts		47
SECTION 10.10 Other Provisions		47
SECTION 10.11 Governing Law		47
SECTION 10.12 No Adverse Interpretation of Other Agreements		48
SECTION 10.13 Successors		48
SECTION 10.14 Severability		48
SECTION 10.15 Table of Contents, Headings, etc.		48
ARTICLE 11
CONVERSION OF CONVERTIBLE SENIOR NOTES
SECTION 11.01 Right to Convert		48
SECTION 11.02	Exercise of Conversion Privilege; Issuance of Common Stock on Conversion; No Adjustment for Interest or Dividends	48
SECTION 11.03 Cash Payments in Lieu of Fractional Shares		50
SECTION 11.04 Conversion Price		50
SECTION 11.05 Adjustment of Conversion Price		50
SECTION 11.06 Effect of Reclassification, Consolidation, Merger or Sale		58
SECTION 11.07 Taxes on Shares Issued		60
SECTION 11.08 Reservation of Shares; Shares to Be Fully Paid; Listing of Common Stock		60
SECTION 11.09 Responsibility of Trustee		60
SECTION 11.10 Notice to Holders Prior to Certain Actions		61
SECTION 11.11 Restriction on Common Stock Issuable Upon Conversion		62

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ARTICLE 12
CONVERSION EVENTS
SECTION 12.01 Conversion Upon Satisfaction of Sale Price Condition.	62
SECTION 12.02 Conversion Based on Trading Price of the Notes.	63
SECTION 12.03 Conversion Upon Notice of Redemption.	64
SECTION 12.04 Conversion Upon Specified Corporate Transactions.	64
EXHIBIT A: FORM OF NOTE
EXHIBIT B: FORM OF RESTRICTED COMMON STOCK LEGEND
EXHIBIT C: FORM OF TRANSFER CERTIFICATE FOR TRANSFER OF RESTRICTED COMMON STOCK

v

CROSS-REFERENCE TABLE*  

Trust Indenture Act Section	Indenture Section
310(a)(1)	7.10
(a)(2)	7.10, 10.10
(a)(3)	n/a
(a)(4)	n/a
(a)(5)	n/a
(b)	7.08, 7.10, 10.02
(c)	n/a
311(a)	7.11
(b)	7.11
(c)	n/a
312(a)	2.05
(b)	10.03
(c)	10.03
313(a)	7.06
(b)(1)	n/a
(b)(2)	7.06
(c)	7.06, 10.02
(d)	7.06
314(a)	3.02, 10.02
(b)	n/a
(c)(1)	10.04
(c)(2)	10.04
(c)(3)	n/a
(d)	n/a
(e)	10.05
(f)	n/a
315(a)	7.01(b)
(b)	7.05, 10.02
(c)	7.01(a)
(d)	7.01(c)
(e)	6.11
316(a)(last sentence)	2.09
(a)(1)(A)	6.05
(a)(1)(B)	6.04

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(a)(2)	n/a
(b)	6.07
(c)	9.04
317(a)(1)	6.08
(a)(2)	6.09
(b)	2.04
318(a)	10.01
(b)	n/a
(c)	10.01

“n/a” means not applicable.

* This Cross-Reference Table shall not, for any purpose, be deemed to be a part of the Indenture.

vii

THIS INDENTURE, dated as of June 2, 2003, is between Delta Air Lines, Inc., a Delaware corporation (the “Company”), and The Bank of New York Trust Company of Florida, N.A., a national banking association duly organized and existing under the laws of the United States of America (the “Trustee”). The Company has duly authorized the creation of its 8.00% Convertible Senior Notes due 2023 (the “Convertible Senior Notes” or the “Notes”), and to provide therefor the Company and the Trustee have duly authorized the execution and delivery of this Indenture. Each party agrees as follows for the benefit of the other party and for the equal and ratable benefit of the Holders from time to time of the Notes:

ARTICLE 1

DEFINITIONS

SECTION 1.01 Definitions.

“Affiliate” means, when used with reference to any person, any other person directly or indirectly controlling, controlled by, or under direct or indirect common control of, the referent person. For the purposes of this definition, “control” when used with respect to any specified person means the power to direct or cause the direction of management or policies of the referent person, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise. The terms “controlling” and “controlled” have meanings correlative of the foregoing.

“Agent” means any Registrar, Paying Agent, Conversion Agent or co-registrar.

“Agent Member” means any member of, or participant in, the Depositary.

“Board of Directors” means the Board of Directors of the Company or any authorized committee of the Board of Directors.

“Capital Stock” of any person means any and all shares, interests, rights to purchase, warrants, options, participations or other equivalents of or interests in (however designated) equity of such person, but excluding any debt securities convertible into such equity.

“Commission” means the Securities and Exchange Commission.

“Common Stock” means any stock of any class of the Company which has no preference in respect of dividends or of amounts payable in the event of any voluntary or involuntary liquidation, dissolution or winding up of the Company and which is not subject to redemption by the Company. Subject to the provisions of Section 11.06, however, shares issuable on conversion of Notes shall include only shares of the class designated as Common Stock of the Company at the date of this Indenture or shares of any class or classes resulting from any reclassification or reclassifications thereof and which have no preference in respect of dividends or of amounts payable in the event of any voluntary or involuntary liquidation, dissolution or winding up of the Company and which are not subject to redemption by the Company; provided that if at any time there shall be more than one such resulting class, the shares of each such class then so issuable shall be substantially in the proportion which the total number of shares of such class resulting from all such reclassifications bears to the total number of shares of all such classes resulting from all such reclassifications.

1

“Company” means the party named as such above until a successor replaces it in accordance with Article 5 and thereafter means the successor. References to the Company shall not include any subsidiary.

“Conversion Prices” shall be as specified in paragraph 9 of the Note, the form of which is attached hereto as Exhibit A, as adjusted in accordance with the provisions of Articles 11 and 12.

“Conversion Rate” shall be as specified in paragraph 9 of the Note, the form of which is attached hereto as Exhibit A, subject to adjustment in accordance with the provisions of Articles 11 and 12.

“Convertible Senior Notes” or the “Notes” means the 8.00% Convertible Senior Notes due 2023 issued, authenticated and delivered pursuant to this Indenture.

“Corporate Trust Office” means the corporate trust office of the Trustee at which at any particular time the trust created by this Indenture shall principally be administered; as of the date hereof, the Corporate Trust Office is located at 10161 Centurion Parkway, Jacksonville, FL 32256, Attention: Corporate Trust Department, Facsimile: (904) 645-1921.

“Default” means any event that is, or after notice or passage of time, or both, would be, an Event of Default.

“Depositary” means, with respect to any Global Securities, a clearing agency that is registered as such under the Exchange Act and is designated by the Company to act as Depositary for such Global Securities (or any successor securities clearing agency so registered), which shall initially be DTC.

“Designated Event” means any transaction or event (whether by means of an exchange offer, liquidation, tender offer, consolidation, merger, combination, reclassification, recapitalization or otherwise) in connection with which all or substantially all of the Common Stock shall be exchanged for, converted into, acquired for or constitutes solely the right to receive, consideration which is not all or substantially all Common Stock that:

(i) is listed on, or immediately after such transaction or event will be listed on, a United States national securities exchange; or

(ii) is approved, or immediately after such transaction or event will be approved, for quotation on the Nasdaq National Market or any similar United States system of automated dissemination of quotations of securities prices.

“DTC” means The Depository Trust Company, a New York corporation.

“ex-dividend date” shall have the meaning set forth in Article 12 hereof and paragraph 9 of the Note, the form of which is attached hereto as Exhibit A.

“Exchange Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.

2

“GAAP” means generally accepted accounting principles set forth in the opinions and pronouncements of the Accounting Principles Board of the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board or in such other statements by such other entity as may be approved by a significant segment of the accounting profession of the United States, which are in effect from time to time.

“Global Securities Legend” means the legend labeled as such and that is set forth in Exhibit A hereto.

“Holder” means a person in whose name the Notes are registered on the Registrar’s books.

“Indebtedness” means, with respect to any person, all obligations, whether or not contingent, of such person (i) (a) for borrowed money (including, but not limited to, any indebtedness secured by a security interest, mortgage or other lien on the assets of the Company that is (1) given to secure all or part of the purchase price of property subject thereto, whether given to the vendor of such property or to another, or (2) existing on property at the time of acquisition thereof), (b) evidenced by a note, debenture, bond or other written instrument, (c) under a lease required to be capitalized on the balance sheet of the lessee under GAAP or under any lease or related document (including a purchase agreement) that provides that the Company is contractually obligated to purchase or cause a third party to purchase and thereby guarantee a minimum residual value of the lease property to the lessor and the obligations of the Company under such lease or related document to purchase or to cause a third party to purchase such leased property, (d) in respect of letters of credit, bank guarantees or bankers’ acceptances (including reimbursement obligations with respect to any of the foregoing), (e) with respect to Indebtedness secured by a mortgage, pledge, lien, encumbrance, charge or adverse claim affecting title or resulting in an encumbrance to which the property or assets of such person are subject, whether or not the obligation secured thereby shall have been assumed by or shall otherwise be such person’s legal liability, (f) in respect of the balance of deferred and unpaid purchase price of any property or assets, and (g) under interest rate or currency swap agreements, cap, floor and collar agreements, spot and forward contracts and similar agreements and arrangements; (ii) with respect to any obligation of others of the type described in the preceding clause (i) or under clause (iii) below assumed by or guaranteed in any manner by such person through an agreement to purchase (including, without limitation, “take or pay” and similar arrangements), contingent or otherwise (and the obligations of such person under any such assumptions, guarantees or other such arrangements); and (iii) any and all deferrals, renewals, extensions, refinancings and refundings of, or amendments, modifications or supplements to, any of the foregoing.

“Indenture” means this Indenture as amended or supplemented from time to time.

“Initial Purchaser” means J.P. Morgan Securities Inc.

“Interest Payment Date” means June 3 and December 3 of each year, beginning December 3, 2003.

3

“Liquidated Damages” shall be as set forth in paragraph 15 of the Note, the form of which is attached as Exhibit A hereto, qualified by reference to, and is subject in its entirety to, the more complete description thereof contained in the Registration Rights Agreement.

“Maturity Date” means June 3, 2023.

“Offering Memorandum” means the final offering memorandum, dated May 28, 2003, relating to the Notes, including any supplements and amendments thereto.

“Officer” means the Chairman of the Board, the Chief Executive Officer, the President, the Chief Financial Officer, the Chief Accounting Officer, any Executive Vice President, Senior Vice President or Vice President (whether or not designated by a number or numbers or word or words before or after the title “Vice President”), the Treasurer, the Secretary and any Assistant Treasurer or any Assistant Secretary of the Company.

“Officers’ Certificate” means a certificate signed by two Officers, one of whom is the Chairman of the Board, the Chief Executive Officer, the President, the Chief Financial Officer or the Treasurer of the Company.

“Opinion of Counsel” means a written opinion from legal counsel, who may be an employee of or counsel to the Company or the Trustee, except to the extent otherwise indicated in this Indenture.

A “person” means any individual, corporation, partnership, joint venture, trust, estate, unincorporated organization, limited liability company or government or any agency or political subdivision thereof.

“Principal Property” means any aircraft, or any aircraft engine installed in any aircraft, that has 75 or more passenger seats, whether now owned or hereafter acquired by the Company or any Restricted Subsidiary.

“Purchase Agreement” means the Purchase Agreement related to the Notes, dated May 28, 2003, between the Company and the Initial Purchaser.

“Purchase Date” means June 3, 2008, June 3, 2013 and June 3, 2018, as applicable, as specified in the relevant Purchase Notice.

“Redemption Date” means the business day specified for redemption of the Notes in accordance with the terms of the Notes and this Indenture, as set forth in a notice of redemption.

“Registration Rights Agreement” means the Registration Rights Agreement relating to the Notes and the Common Stock issuable upon conversion of such Notes, dated June 2, 2003, between the Company and the Initial Purchaser, as such agreement may be amended, modified or supplemented from time to time.

“Regular Record Date” means the May 19 or November 19 immediately preceding each Interest Payment Date.

4

“Restricted Common Stock Legend” means the legend labeled as such and that is set forth in Exhibit B hereto.

“Restricted Securities Legend” means the legend labeled as such and that is set forth in Exhibit A hereto.

“Restricted Subsidiary” means any subsidiary of the Company (i) substantially all of the property of which is located, and substantially all of the operations of which are conducted, in the United States, and (ii) which owns a Principal Property, except a subsidiary which is primarily engaged in the business of a finance company.

“Securities Act” means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.

“Shelf Registration Statement” shall have the meaning set forth in the Registration Rights Agreement.

A “subsidiary” means, with respect to any person, (i) any corporation, association or other business entity of which more than 50% of the total voting power of shares of Capital Stock entitled (without regard to the occurrence of any contingency) to vote in the election of directors, managers or trustees thereof is at the time owned or controlled, directly or indirectly, by such person or one or more of the other subsidiaries of that person (or a combination thereof) and (ii) any partnership (a) the sole general partner or managing general partner of which is such person or a subsidiary of such person or (b) the only general partners of which are such person or of one or more subsidiaries of such person (or any combination thereof).

“TIA” means the Trust Indenture Act of 1939 (15 U.S. Code §§ 77aaa- 77bbbb) as in effect on the date of execution of this Indenture, except as provided in Sections 9.03 and 11.07.

“trading price” shall have the meaning specified in Article 12 hereof and paragraph 9 of the Note, the form of which is attached hereto as Exhibit A.

“Trust Officer” means, when used with respect to the Trustee, any officer within the corporate trust department of the Trustee, including any vice president, assistant vice president, assistant secretary, assistant treasurer, trust officer or any other officer of the Trustee who customarily performs functions similar to those performed by the persons who at the time shall be such officers, respectively, or to whom any corporate trust matter is referred because of such person’s knowledge of and familiarity with the particular subject and having direct responsibility for the administration of this Indenture.

“Trustee” means the party named as such above until a successor replaces it in accordance with the applicable provisions of this Indenture and thereafter means the successor.

“Voting Stock” of a corporation means all classes of Capital Stock of such corporation then outstanding and normally entitled to vote in the election of directors.

5

SECTION 1.02 Other Definitions.

	Defined in Section
“Bankruptcy Law”	6.01(g)
“business day”	10.07
“Clearstream”	2.01(a)
“closing price”	11.05(g)
“Conversion Agent”	2.03
“Conversion Date”	11.02(d)
“Current Market Price”	11.05(g)
“Custodian”	6.01
“Designated Event Date”	4.09(a)
“Designated Event Notice”	4.09(a)
“Designated Event Offer”	4.09(a)
“Designated Event Offer Termination Date”	4.09(b)
“Designated Event Repurchase Date”	4.09(b)
“Designated Event Repurchase Notice”	4.09(c)
“Designated Event Repurchase Price”	4.09(a)
“Euroclear”	2.01(a)
“Event of Default”	6.01
“Expiration Time”	11.05(f)
“fair market value”	11.05(g)
“Global Security”	2.01
“Investment Company Act”	3.09
“non-electing share”	11.06
“Paying Agent”	2.03
“Purchase Notice”	4.08(a)(i)
“Purchase Price”	4.08(a)
“Purchased Shares”	11.05(f)
“Record Date”	11.05(g)
“Redemption Price”	4.01(a)
“Register”	2.03
“Registrar”	2.03
“Regulation S”	2.01(a)
“Rule 144A”	2.01(a)
“Securities”	11.05(d)
“Special Record Date”	2.12(b)
“trading day”	11.05(g)
“Trigger Event”	11.05(d)

SECTION 1.03 Incorporation by Reference of Trust Indenture Act.

Whenever this Indenture refers to a provision of the TIA, the provision is incorporated by reference in and made a part of this Indenture. All other terms in this Indenture that are defined

6

by the TIA, defined by TIA reference to another statute or defined by Commission rule under the TIA have the meanings so assigned to them.

SECTION 1.04 Rules of Construction.

Unless the context otherwise requires:

(a) a term has the meaning assigned to it;

(b) an accounting term not otherwise defined has the meaning assigned to it in accordance with GAAP;

(c) “or” is not exclusive;

(d) words in the singular include the plural, and in the plural include the singular; and

(e) the male, female and neuter genders include one another.

ARTICLE 2

THE CONVERTIBLE SENIOR NOTES

SECTION 2.01 Form.

(a) GLOBAL SECURITIES. The Notes are being offered and sold by the Company pursuant to the Purchase Agreement. The Notes are being offered and sold (i) outside the United States to non-U.S. persons in reliance on Regulation S under the Securities Act (“Regulation S”) or (ii) to “qualified institutional buyers” (as defined in Rule 144A) in reliance on Rule 144A under the Securities Act (“Rule 144A”), each pursuant to the Purchase Agreement, and shall be issued in the form of one or more permanent global securities in definitive, fully registered form without interest coupons with the Global Securities Legend and Restricted Securities Legend as set forth in Exhibit A hereto (each, a “Global Security”). Any Global Security shall be deposited on behalf of the purchasers of the Notes represented thereby with the Trustee, as custodian for the Depositary, and registered in the name of the Depositary or a nominee of the Depositary for the accounts of participants in the Depositary (and, in the case of Notes held in accordance with Regulation S, registered in the name of the Depositary or a nominee of the Depositary for the accounts of designated agents holding on behalf of the Euroclear System (“Euroclear”) or Clearstream Banking, société anonyme (“Clearstream”)), duly executed by the Company and authenticated by the Trustee as hereinafter provided. The aggregate principal amount of a Global Security may from time to time be increased or decreased by adjustments made on the records of the Trustee and the Depositary or its nominee as hereinafter provided.

(b) BOOK-ENTRY PROVISIONS. This Section 2.01(b) shall apply only to a Global Security deposited with or on behalf of the Depositary. The Company shall execute and the Trustee shall, in accordance with this Section 2.01(b) and the written order of the Company, authenticate and deliver initially one or more Global Securities that (i) shall be registered in the name of Cede & Co. or other nominee of such Depositary and (ii) shall be delivered by the

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Trustee to such Depositary or pursuant to such Depositary’s instructions or held by the Trustee as custodian for the Depositary.

Agent Members shall have no rights under this Indenture with respect to any Global Security held on their behalf by the Depositary or by the Trustee as the custodian of the Depositary or under such Global Security, and the Depositary may be treated by the Company, the Trustee and any agent of the Company or the Trustee as the absolute owner of such Global Security for all purposes whatsoever. Notwithstanding the foregoing, nothing herein shall prevent the Company, the Trustee or any agent of the Company or the Trustee from giving effect to any written certification, proxy or other authorization furnished by the Depositary or impair, as between the Depositary and its Agent Members, the operation of customary practices of such Depositary governing the exercise of the rights of a holder of a beneficial interest in any Global Security.

The provisions of the “Operating Procedures of the Euroclear System” and “Terms and Conditions Governing Use of Euroclear” and the “Management Regulations and Instructions to Participants” of Clearstream shall be applicable to interests in any Global Securities that are held by participants through Euroclear or Clearstream. The Trustee shall have no obligation to notify Holders of any such procedures or to monitor or enforce compliance with the same.

(c) DEFINITIVE SECURITIES. Except as provided in Section 2.10, owners of beneficial interests in Global Securities will not be entitled to receive physical delivery of certificated Notes in definitive form. If applicable, certificated Notes in definitive form will bear the Restricted Securities Legend set forth on Exhibit A unless removed in accordance with Section 2.06(f).

SECTION 2.02 Execution and Authentication.

One Officer shall sign the Notes for the Company by manual or facsimile signature.

If an Officer whose signature is on a Note no longer holds that office at the time the Note is authenticated, the Note shall nevertheless be valid.

A Note shall not be valid until authenticated by the manual signature of the Trustee. The signature shall be conclusive evidence that the Note has been authenticated under this Indenture.

Upon a written order of the Company signed by an Officer of the Company, the Trustee shall authenticate Notes for original issue up to an aggregate principal amount of $300,000,000 (plus up to an additional $50,000,000 aggregate principal amount of Notes that may be sold by the Company to the Initial Purchaser pursuant to the option granted pursuant to the Purchase Agreement). The aggregate principal amount of Notes outstanding at any time may not exceed $350,000,000, except as provided in Section 2.07.

The Notes shall be issuable only in registered form without coupons and only in denominations of $1,000 or any integral multiple thereof.

The Trustee may appoint an authenticating agent acceptable to the Company to authenticate Notes. An authenticating agent may authenticate Notes whenever the Trustee may

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do so. Each reference in this Indenture to authentication by the Trustee includes authentication by such agent. An authenticating agent has the same right as an Agent to deal with the Company or an Affiliate of the Company.

SECTION 2.03 Registrar, Paying Agent and Conversion Agent.

The Company shall maintain or cause to be maintained in such locations as it shall determine, which may be the Corporate Trust Office, an office or agency: (i) where securities may be presented for registration of transfer or for exchange (“Registrar”); (ii) where Notes may be presented for payment (“Paying Agent”); (iii) an office or agency where Notes may be presented for conversion (the “Conversion Agent”); and (iv) where notices and demands to or upon the Company in respect of Notes and this Indenture may be served by the Holders. The Registrar shall keep a Register (“Register”) of the Notes and of their transfer and exchange. The Company may appoint one or more co-registrars, one or more additional paying agents and one or more additional conversion agents. The term “Registrar” includes any additional registrar, the term “Paying Agent” includes any additional paying agent and the term “Conversion Agent” includes any additional Conversion Agent. The Company may change any Paying Agent, Registrar, Conversion Agent or co-registrar without prior notice. The Company shall notify the Trustee of the name and address of any Agent not a party to this Indenture and shall enter into an appropriate agency agreement with any Registrar, Paying Agent, Conversion Agent or co-registrar not a party to this Indenture. The agreement shall implement the provisions of this Indenture that relate to such Agent. The Company or any of its subsidiaries may act as Paying Agent, Registrar, Conversion Agent or co-registrar, except that for purposes of Article 6 and Section 4.09, neither the Company nor any of its subsidiaries shall act as Paying Agent. If the Company fails to appoint or maintain another entity as Registrar, or Paying Agent or Conversion Agent, the Trustee shall act as such, and the Trustee shall initially act as such.

SECTION 2.04 Paying Agent to Hold Money in Trust.

The Company shall require each Paying Agent (other than the Trustee, who hereby so agrees) to agree in writing that the Paying Agent will hold in trust for the benefit of Holders or the Trustee all money held by the Paying Agent for the payment of principal of, interest or Liquidated Damages, if any, on, or the Redemption Price, Purchase Price or Designated Event Repurchase Price for, the Notes, and will notify the Trustee of any default by the Company in respect of making any such payment. While any such default continues, the Trustee may require a Paying Agent to pay all money held by it to the Trustee. The Company at any time may require a Paying Agent to pay all money held by it to the Trustee. Upon payment over to the Trustee, the Paying Agent (if other than the Company or a subsidiary of the Company) shall have no further liability for the money. If the Company or a subsidiary of the Company acts as Paying Agent, it shall segregate and hold in a separate trust fund for the benefit of the Holders all money held by it as Paying Agent.

SECTION 2.05 Holder Lists.

The Trustee shall preserve in as current a form as is reasonably practicable the most recent list available to it of the names and addresses of Holders and shall otherwise comply with TIA § 312(a). If the Trustee is not the Registrar, the Company shall furnish to the Trustee at

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least seven business days before each Interest Payment Date, and as the Trustee may request in writing within fifteen (15) days after receipt by the Company of any such request (or such lesser time as the Trustee may reasonably request in order to enable it to timely provide any notice to be provided by it hereunder), a list in such form and as of such date as the Trustee may reasonably require of the names and addresses of Holders.

SECTION 2.06 Transfer and Exchange.

(a) When Notes are presented to the Registrar or a co-registrar with a request to register a transfer or to exchange them for an equal principal amount of Notes for other denominations, the Registrar shall register the transfer or make the exchange if its requirements for such transactions are met. To permit registrations of transfers and exchanges, the Company shall issue and the Trustee shall authenticate Notes at the Registrar’s request, bearing registration numbers not contemporaneously outstanding. No service charge shall be made to a Holder for any registration of transfer or exchange (except as otherwise expressly permitted herein), but the Company and the Registrar may require payment of a sum sufficient to cover any transfer tax or other governmental charge payable upon exchanges from the Holder requesting such registration of transfer or exchange.

(b) The Company shall not be required to make, and the Registrar need not register, transfers or exchanges of any Notes selected for redemption (except, in the case of Notes to be redeemed in part, the portion thereof not to be redeemed) or any Notes in respect of which a Purchase Notice or Designated Event Repurchase Notice has been given and not withdrawn by the Holder thereof in accordance with the terms of this Indenture (except, in the case of Notes to be purchased in part, the portion thereof not to be purchased).

(c) All Notes issued upon any transfer or exchange of Notes in accordance with this Indenture shall be the valid obligations of the Company, evidencing the same debt, and entitled to the same benefits under this Indenture as the Notes surrendered upon such registration of transfer or exchange.

(d) Notwithstanding any provision to the contrary herein, so long as a Global Security remains outstanding and is held by or on behalf of the Depositary, transfers of a Global Security, in whole or in part, or of any beneficial interest therein, shall only be made in accordance with Sections 2.01(b) and 2.10; provided, however, that beneficial interests in a Global Security may be transferred to persons who take delivery thereof in the form of a beneficial interest in the Global Security in accordance with the transfer restrictions set forth under the heading “Notice to Investors” in the Offering Memorandum and, if applicable, in the Restricted Securities Legend.

Except for transfers or exchanges made in accordance with Section 2.10, transfers of a Global Security shall be limited to transfers of such Global Security in whole, but not in part, to nominees of the Depositary or to a successor of the Depositary or such successor’s nominee.

(e) In the event that a Global Security is exchanged for certificated Notes in definitive form pursuant to Section 2.10(b) prior to the effectiveness of a Shelf Registration Statement with respect to such Notes, such exchange may occur, and such Notes may be further exchanged or transferred, only upon receipt by the Registrar of (1) such Global Security or such

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Notes in definitive form, duly endorsed as provided herein, as applicable, (2) instructions from the Holder directing the Trustee to authenticate and deliver one or more Notes in definitive form of the same aggregate principal amount as the Global Security or the Notes in definitive form (or portion thereof), as applicable, to be transferred, such instructions to contain the name or names of the designated transferee or transferees, the authorized denomination or denominations of the Notes in definitive form to be so issued and appropriate delivery instructions, and (3) such certifications or other information and, in the case of transfers pursuant to Rule 144 under the Securities Act, legal opinions as the Company may reasonably require to confirm that such transfer is being made pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act (including the certification requirements intended to ensure that such transfers comply with Rule 144A or Regulation S under the Securities Act, as the case may be), and upon compliance with such other procedures as may from time to time be adopted by the Company and the Registrar.

(f) Except in connection with a Shelf Registration Statement contemplated by and in accordance with the terms of the Registration Rights Agreement, if Notes are issued upon the registration of transfer, exchange or replacement of Notes bearing a Restricted Securities Legend, or if a request is made to remove such a Restricted Securities Legend on the Notes, the Notes so issued shall bear the Restricted Securities Legend, or a Restricted Securities Legend shall not be removed, as the case may be, unless there is delivered to the Company such satisfactory evidence, which, in the case of a transfer made pursuant to Rule 144 under the Securities Act, may include an opinion of counsel given in accordance with the laws in the State of New York, as may be reasonably required by the Company, that neither the legend nor the restrictions on transfer set forth therein are required to ensure that transfers thereof comply with the provisions of Rule 144A, Rule 144 or Regulation S under the Securities Act or that such Notes are not “restricted” within the meaning of Rule 144 under the Securities Act. Upon provision to the Company of such satisfactory evidence, the Trustee, at the written direction of the Company, shall authenticate and deliver Notes that do not bear the legend. The Company shall not otherwise be entitled to require the delivery of a legal opinion in connection with any transfer or exchange of Securities.

(g) Neither the Trustee nor any Agent shall have any responsibility for any actions taken or not taken by the Depositary.

(h) The Trustee shall have no obligation or duty to monitor, determine or inquire as to compliance with any restrictions on transfer imposed under this Indenture or under applicable law with respect to any transfer of any interest in any Notes (including any transfers between or among the Depositary’s participants or beneficial owners of interests in any Global Security) other than to require delivery of such certificates and other documentation as is expressly required by, and to do so if and when expressly required by, the terms of this Indenture and to examine the same to determine substantial compliance as to form with the express requirements hereof.

SECTION 2.07 Replacement Convertible Senior Notes.

(a) If the Holder claims that its Note has been lost, destroyed or wrongfully taken, the Company shall issue and the Trustee shall authenticate a replacement Note if the Trustee’s and

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the Company’s requirements are met. If required by the Trustee or the Company as a condition of receiving a replacement Note, the Holder must provide a certificate of loss and an indemnity and/or an indemnity bond sufficient, in the judgment of both the Company and the Trustee, to fully protect the Company, the Trustee, any Agent and any authenticating agent from any loss, liability, cost or expense which any of them may suffer or incur if the Note is replaced. The Company and the Trustee may charge the relevant Holder for their expenses in replacing any Note.

(b) The Trustee or any authenticating agent may authenticate any such substituted Note, and deliver the same upon the receipt of such security or indemnity as the Trustee and the Company may require. Upon the issuance of any substituted Note, the Company and the Trustee may require the payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in relation thereto and any other expenses connected therewith. In case any Note which has matured or is about to mature, submitted for redemption or repurchase pursuant to Article 4 or is about to be converted into Common Stock pursuant to Articles 11 and 12, shall become mutilated or be destroyed, lost or stolen, the Company may, instead of issuing a substitute Note, pay or authorize the payment of or convert or authorize the conversion of the same (without surrender thereof except in the case of a mutilated Note), as the case may be, if the applicant for such payment or conversion shall furnish to the Company, to the Trustee and, if applicable, to the paying agent or conversion agent such security or indemnity as may be required by the Company or the Trustee to save each of them harmless for any loss, liability, cost or expense caused by or connected with such substitution, and, in case of destruction, loss or theft, evidence satisfactory to the Company, the Trustee and, if applicable, any paying agent or conversion agent of the destruction, loss or theft of such Note and of the ownership thereof.

(c) Every replacement Note is an additional obligation of the Company and shall be entitled to all the benefits provided under this Indenture equally and proportionately with all other Notes duly issued, authenticated and delivered hereunder.

SECTION 2.08 Outstanding Convertible Senior Notes.

The Notes outstanding at any time are all the Notes properly authenticated by the Trustee except for those cancelled by the Trustee, those delivered to it for cancellation, and those described in this Section as not outstanding.

If a Note is replaced pursuant to Section 2.07, it ceases to be outstanding unless the Trustee receives proof satisfactory to it that the replaced Note is held by a bona fide purchaser.

If Notes are considered paid under Section 3.01 or converted pursuant to Articles 11 and 12, they cease to be outstanding, and interest and Liquidated Damages, if any, on them ceases to accrue.

Subject to Section 2.09 hereof, a Note does not cease to be outstanding because the Company or an Affiliate of the Company holds the Note.

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SECTION 2.09 When Treasury Convertible Senior Notes Disregarded.

In determining whether the Holders of the required principal amount of Notes have concurred in any direction, waiver or consent, Notes owned by the Company or an Affiliate of the Company shall be considered as though they are not outstanding except that for the purposes of determining whether the Trustee shall be protected in relying on any such direction, waiver or consent, only Notes which a Trust Officer of the Trustee actually knows are so owned shall be so disregarded.

SECTION 2.10 Temporary Convertible Senior Notes.

(a) Until definitive Notes are ready for delivery, the Company may prepare and the Trustee shall authenticate temporary Notes. Temporary Notes shall be substantially in the form of definitive Notes but may have variations that the Company considers appropriate for temporary Notes and shall be reasonably acceptable to the Trustee. Without unreasonable delay, the Company shall prepare and the Trustee shall authenticate definitive Notes in exchange for temporary Notes.

(b) A Global Security deposited with the Depositary or with the Trustee as custodian for the Depositary pursuant to Section 2.01 shall be transferred to the beneficial owners thereof in the form of certificated Notes in definitive form only if such transfer complies with Section 2.06 and (i) the Depositary notifies the Company that it is unwilling or unable to continue as Depositary for such Global Security or if at any time such Depositary ceases to be a “clearing agency” registered under the Exchange Act and a successor Depositary is not appointed by the Company within 90 days of such notice, or (ii) an Event of Default has occurred and is continuing.

(c) Any Global Security or interest thereon that is transferable to the beneficial owners thereof in the form of certificated Notes in definitive form shall, if held by the Depository, be surrendered by the Depositary to the Trustee, without charge, and the Trustee shall authenticate and deliver, upon such transfer of each portion of such Global Security, an equal aggregate principal amount of Notes of authorized denominations in the form of certificated Notes in definitive form. Any portion of a Global Security transferred pursuant to this Section shall be executed, authenticated and delivered only in denominations of $1,000 and any integral multiple thereof and registered in such names as the Depositary shall direct. Any Notes in the form of certificated Notes in definitive form delivered in exchange for an interest in the Global Security shall, except as otherwise provided by Section 2.06(f), bear the Restricted Securities Legend set forth in Exhibit A hereto.

(d) Prior to any transfer pursuant to Section 2.10(b), the registered Holder of a Global Security may grant proxies and otherwise authorize any person, including Agent Members and persons that may hold interests through Agent Members, to take any action that a Holder is entitled to take under this Indenture or the Notes.

SECTION 2.11 Cancellation.

The Company at any time may deliver Notes to the Trustee for cancellation. The Registrar and Paying Agent shall forward to the Trustee any Notes surrendered to them for

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registration of transfer, exchange or payment. The Trustee and no one else may cancel Notes surrendered for registration of transfer, exchange, payment, replacement, conversion, repurchase or cancellation. Upon written instructions of the Company, the Trustee shall dispose of cancelled Notes in accordance with its procedures for the disposition of cancelled securities in effect as of the date of such disposition and, after such disposition, shall deliver a certificate of disposition to the Company. The Company may not issue new Notes to replace Notes that it has paid or repurchased or that have been delivered to the Trustee for cancellation or that any Holder has (i) converted pursuant to Articles 11 and 12 hereof or (ii) submitted for repurchase pursuant to Article 4 hereof (unless such submission is withdrawn in accordance with the terms of this Indenture).

SECTION 2.12 Defaulted Interest.

(a) If the Company fails to make a payment of interest on the Notes, it shall pay such defaulted interest plus, to the extent lawful, any interest payable on the defaulted interest. It may pay such defaulted interest, plus any such interest payable on it, to the persons who are Holders on a subsequent special record date. The Company shall fix any such record date.

(b) The Company may elect to make payment of any defaulted interest to the persons in whose names the Notes are registered at the close of business on a special record date for the payment of such defaulted interest, which shall be fixed in the following manner. The Company shall notify the Trustee in writing of the amount of defaulted interest proposed to be paid on each Note and the date of the proposed payment (which shall not be less than 20 days after such notice is received by the Trustee), and at the same time the Company shall deposit with the Trustee an amount of money equal to the aggregate amount proposed to be paid in respect of such defaulted interest or shall make arrangements satisfactory to the Trustee for such deposit on or prior to the date of the proposed payment, such money when deposited to be held in trust for the benefit of the persons entitled to such defaulted interest as in this clause provided. Thereupon the Trustee shall fix a special record date for the payment of such defaulted interest which shall be not more than 15 days and not less than 10 days prior to the date of the proposed payment and not less than 10 days after the receipt by the Trustee of the notice of the proposed payment (the “Special Record Date”). The Trustee shall promptly notify the Company of such Special Record Date and, in the name and at the expense of the Company, shall cause notice of the proposed payment of such defaulted interest and the Special Record Date therefor to be mailed, first-class postage prepaid, to each Holder of Notes at his address as it appears on the list of Securityholders maintained pursuant to Section 2.05 not less than 10 days prior to such Special Record Date. Notice of the proposed payment of such defaulted interest and the Special Record Date therefor having been mailed as aforesaid, such defaulted interest shall be paid to the persons in whose names the Notes are registered at the close of business on such Special Record Date and shall no longer be payable pursuant to the following paragraph (c).

(c) The Company may make payment of any defaulted interest on the Notes in any other lawful manner not inconsistent with the requirements of any securities exchange on which such Notes may be listed, and upon such notice as may be required by such exchange, if, after notice given by the Company to the Trustee of the proposed payment pursuant to this clause, such manner of payment shall be deemed practicable by the Trustee.

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SECTION 2.13 CUSIP Number.

The Company in issuing the Notes may use a “CUSIP” number and, if so, such CUSIP number shall be included in notices of repurchase or exchange as a convenience to Holders; provided, however, that any such notice may state that no representation is made as to the correctness or accuracy of the CUSIP number printed in the notice or on the Notes and that reliance may be placed only on the other identification numbers printed on the Notes. The Company will promptly notify the Trustee of any change in the CUSIP number.

SECTION 2.14 Restrictions on Transfer.

The Company agrees that it will refuse to register any transfer of Notes or any shares of Common Stock issued upon conversion of Notes that is not made in accordance with the provisions of Regulation S under the Securities Act, pursuant to a registration statement which has been declared effective under the Securities Act or pursuant to an available exemption from the registration requirements of the Securities Act; provided that the provisions of this paragraph shall not be applicable to any Notes which do not bear a Restricted Securities Legend or to any shares of Common Stock evidenced by certificates which do not bear a Restricted Common Stock Legend.

ARTICLE 3

COVENANTS

SECTION 3.01 Payments on the Notes.

The Company shall pay the principal of and interest and Liquidated Damages, if any, on the Notes on the dates and in the manner provided in the Notes. Principal, interest, Liquidated Damages, if any, Redemption Price, Purchase Price and Designated Event Repurchase Price, as applicable, shall be considered paid on the date due if the Trustee or Paying Agent (other than the Company or a subsidiary of the Company) holds as of 10:00 a.m., New York City time, on that date immediately available funds designated for and sufficient to pay all principal, interest, Liquidated Damages, if any, Redemption Price, Purchase Price or the Designated Event Repurchase Price then due.

To the extent lawful, the Company shall pay interest (including post-petition interest in any proceeding under any Bankruptcy Law) on (i) overdue principal, at the rate borne by the Notes, compounded semiannually; and (ii) overdue installments of interest and Liquidated Damages, if any (without regard to any applicable grace period) at the same rate, compounded semiannually.

SECTION 3.02 Commission Reports.

The Company shall comply with Section 314(a) of the TIA. Whether or not required by the rules and regulations of the Commission, so long as any of the Notes are outstanding, the Company shall file with the Commission and furnish to the Trustee all quarterly and annual financial information (without exhibits) required to be contained in a filing on Form 10-Q and Form 10-K, including a “Management’s Discussion and Analysis of Financial Condition and

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Results of Operations,” and, with respect to the annual consolidated financial statements only, a report thereon by the independent auditors of the Company.

SECTION 3.03 Compliance Certificate.

The Company shall deliver to the Trustee within 120 days after the end of each fiscal year of the Company, an Officers’ Certificate stating that a review of the activities of the Company and its subsidiaries during the preceding fiscal year has been made under the supervision of the signing Officers with a view to determining whether the Company has fully performed its obligations under this Indenture and further stating, as to each such Officer signing such certificate, that to the best of his or her knowledge, the Company is not in default in the performance or observance of any of the terms and conditions hereof (or, if any Default or Event of Default shall have occurred, describing all such Defaults or Events of Default of which he or she may have knowledge) and, that to the best of his or her knowledge, no event has occurred and remains in existence by reason of which payments on account of the principal of or interest or Liquidated Damages, if any, on the Notes are prohibited.

The Company shall, so long as any of the Notes are outstanding, deliver to the Trustee, forthwith upon becoming aware of any Default or Event of Default, an Officers’ Certificate specifying such Default or Event of Default and what action the Company is taking or proposes to take with respect thereto.

SECTION 3.04 Maintenance of Office or Agency.

The Company shall maintain or cause to be maintained the office or agency required under Section 2.03. The Company shall give prompt written notice to the Trustee of the location, and any change in the location, of such office or agency not maintained by the Trustee. If at any time the Company shall fail to maintain any such required office or agency or shall fail to furnish the Trustee with the address thereof, presentations, surrenders, notices and demands with respect to the Notes may be made or served at the Corporate Trust Office of the Trustee.

The Company may also from time to time designate one or more other offices or agencies where the Notes may be presented or surrendered for any or all such purposes and may from time to time rescind such designation.

SECTION 3.05 Continued Existence.

Subject to Article 5, the Company shall do or cause to be done all things necessary to preserve and keep in full force and effect its corporate existence.

SECTION 3.06 Appointments to Fill Vacancies in Trustee’s Office.

The Company, whenever necessary to avoid or fill a vacancy in the office of Trustee, will appoint, in the manner provided in Section 7.08, a Trustee, so that there shall at all times be a Trustee hereunder.

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SECTION 3.07 Stay, Extension and Usury Laws.

The Company covenants (to the extent that it may lawfully do so) that it shall not at any time insist upon, plead or in any manner whatsoever claim or take the benefit or advantage of, any stay, extension or usury law wherever enacted, now or at any time hereafter enforced, that may affect the Company’s obligation to pay the Notes; and the Company (to the extent that it may lawfully do so) hereby expressly waives all benefit or advantage of any such law insofar as such law applies to the Notes, and covenants that it shall not, by resort to any such law, hinder, delay or impede the execution of any power herein granted to the Trustee, but will suffer and permit the execution of every such power as though no such law has been enacted.

SECTION 3.08 Taxes.

The Company shall, and shall cause each of its subsidiaries to, pay prior to delinquency all taxes, assessments and government levies; provided, however, that the Company shall not be required to pay or cause to be paid any such tax, assessment or levy (a) if the failure to do so will not, in the aggregate, have a material adverse impact on the Company and its subsidiaries taken as a whole, or (b) if the amount, applicability or validity is being contested in good faith by appropriate proceedings.

SECTION 3.09 Investment Company Act.

As long as any Notes are outstanding, the Company will conduct its business and operations so as not to become an “investment company” within the meaning of the Investment Company Act of 1940, as amended (the “Investment Company Act”), and will take all steps required in order for it to continue not to be an “investment company” and not to be required to be registered under the Investment Company Act, including, if necessary, redeployment of the assets of the Company.

ARTICLE 4

REDEMPTION AND PURCHASE

SECTION 4.01 Right to Redeem; Notices to Trustee.

(a) The Company, at its option, may redeem all or a portion of the Notes on or after June 5, 2008 at a redemption price in cash (“Redemption Price”) equal to 100% of the principal amount thereof, plus any accrued and unpaid interest to, but excluding, the Redemption Date.

(b) If the Company elects to redeem Notes pursuant to the terms of the Notes and this Indenture, it shall notify the Trustee in writing of the Redemption Date, the principal amount of Notes to be redeemed and the Redemption Price payable on the Redemption Date. The Company shall deliver to the Trustee the notice of redemption provided for in this Section 4.01 by means of a written request or order signed in the name of the Company by any two Officers at least 45 days before the Redemption Date (unless a shorter notice shall be satisfactory to the Trustee).

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SECTION 4.02 Selection of Notes to Be Redeemed.

(a) If less than all the Notes are to be redeemed, the Trustee shall select the Notes to be redeemed pro rata or by lot or by any other method the Trustee considers fair and appropriate (so long as such method is not prohibited by the rules of any stock exchange on which the Notes are then listed). The Trustee shall make the selection at least 30 days but not more than 60 days before the Redemption Date from outstanding Notes not previously called for redemption.

(b) Notes and portions of them the Trustee selects shall be in principal amounts of $1,000 or an integral multiple of $1,000. Provisions of this Indenture that apply to Notes called for redemption also apply to portions of Notes called for redemption. The Trustee shall notify the Company promptly of the amount of Notes or portions thereof to be redeemed.

(c) If any Note selected for partial redemption is converted in part before termination of the conversion right with respect to the portion of the Notes so selected, the converted portion of such Notes shall be deemed to be the portion selected for redemption. Notes that have been converted during a selection of Notes to be redeemed may be treated by the Trustee as outstanding for the purpose of such selection.

SECTION 4.03 Notice of Redemption.

(a) At least 30 days but not more than 60 days before a Redemption Date, the Company shall mail a notice of redemption by first-class mail, postage prepaid, to each Holder of Notes to be redeemed. The notice shall identify the Notes to be redeemed and shall state:

(i) the Redemption Date;

(ii) the Redemption Price payable on the Redemption Date;

(iii) the then current Conversion Price;

(iv) the name and address of the Paying Agent and Conversion Agent;

(v) that Notes called for redemption may be converted at any time prior to the close of business on the Redemption Date;

(vi) that Holders who want to convert Notes must satisfy the requirements set forth in paragraph 9 of the Note;

(vii) that Notes called for redemption must be surrendered to the Paying Agent to collect the Redemption Price;

(viii) if fewer than all the outstanding Notes are to be redeemed, the certificate number(s) or CUSIP number(s) and principal amounts of the particular Notes to be redeemed;

(ix) that, unless the Company defaults in making payment of such Redemption Price, the Notes called for redemption will cease to be outstanding and interest and

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Liquidated Damages, if any, on the Notes called for redemption will cease to accrue on and after the Redemption Date; and

(x) that all rights of the Holder will terminate on and after the Redemption Date (other than the right to receive the Redemption Price upon delivery or transfer of the Notes called for redemption).

(b) At the Company’s request, the Trustee shall give the notice of redemption in the Company’s name and at the Company’s expense, provided that the Company makes such request at least five business days (unless a shorter period shall be satisfactory to the Trustee) prior to the date such notice of redemption must be mailed.

SECTION 4.04 Effect of Notice of Redemption.

Once notice of redemption is given, Notes called for redemption become due and payable on the Redemption Date and at the Redemption Price stated in the notice of redemption, except for Notes which are converted in accordance with the terms of this Indenture. Upon surrender to the Paying Agent, such Notes shall be paid at the Redemption Price stated in the notice of redemption.

SECTION 4.05 Deposit of Redemption Price.

(a) Prior to 10:00 a.m. (New York City time) on the Redemption Date, the Company shall deposit with the Paying Agent (or if the Company or a subsidiary or an Affiliate of either of them is the Paying Agent, shall segregate and hold in trust) money sufficient to pay the Redemption Price for all Notes to be redeemed on that date other than Notes or portions of Notes called for redemption which on or prior thereto have been delivered by the Company to the Trustee for cancellation or have been converted. The Paying Agent shall as promptly as practicable return to the Company any money not required for that purpose because of conversion of Notes pursuant to Articles 11 and 12. If such money is then held by the Company or its subsidiary or an Affiliate of either of them, as Paying Agent, in trust and is not required for such purpose it shall be discharged from such trust.

(b) If as of 10:00 a.m. (New York City time) on any Redemption Date the Paying Agent holds money sufficient to pay in full the Redemption Price for all Notes to be redeemed on such Redemption Date, other than Notes or portions of Notes called for redemption which on or prior thereto have been delivered by the Company to the Trustee for cancellation or have been converted, the Notes will cease to be outstanding immediately following the close of business on the Redemption Date and interest and Liquidated Damages, if any, on the Notes so purchased will cease to accrue on and after such Redemption Date. In such event, all rights of the Holder will terminate, other than the right to receive the Redemption Price upon delivery or transfer of the Notes to be so purchased.

SECTION 4.06 Notes Redeemed in Part.

Upon surrender of a Note that is redeemed in part, the Company shall execute and the Trustee shall authenticate and deliver to the Holder a new Note in an authorized denomination equal in principal amount to the unredeemed portion of the Notes surrendered.

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SECTION 4.07 Arrangement on Call for Redemption.

(a) In connection with any redemption of Notes, the Company may arrange at or shortly before the time of the redemption for the purchase of any Notes called for redemption by an agreement with one or more investment banks or other purchasers to purchase such Notes by paying to the Trustee in trust for the Holders, on or prior to 10:00 a.m. (New York City time) on the Redemption Date, an amount that, together with any amounts deposited with the Trustee by the Company for the redemption of such Notes, is not less than the Redemption Price of such Notes. Notwithstanding anything to the contrary contained in this Article 4, the obligation of the Company to pay the Redemption Prices of such Notes shall be deemed to be satisfied and discharged to the extent such amount is so paid by such purchasers.

(b) If such an agreement is entered into, any Notes not duly surrendered for conversion by the Holders thereof may, at the option of the Company, be deemed, to the fullest extent permitted by law, acquired by such purchasers from such Holders as of the close of business on the Redemption Date, subject to payment of the above amount as aforesaid.

(c) The Trustee shall hold and pay to the Holders whose Notes are selected for redemption any such amount paid to it for purchase in the same manner as it would moneys deposited with it by the Company for the redemption of Notes. Without the Trustee’s prior written consent, no arrangement between the Company and such purchasers for the purchase of any Notes shall increase or otherwise affect any of the powers, duties, responsibilities or obligations of the Trustee as set forth in this Indenture, and the Company agrees to indemnify the Trustee from, and hold it harmless against, any loss, liability or expense arising out of or in connection with any such arrangement for the purchase of any Notes between the Company and such purchasers, including the costs and expenses incurred by the Trustee in the defense of any claim or liability arising out of or in connection with the exercise or performance of any of its powers, duties, responsibilities or obligations under this Indenture.

SECTION 4.08 Purchase of Notes at the Option of the Holders.

(a) Notes shall be purchased by the Company at the option of the Holder thereof, in whole or in part, at a purchase price in cash (the “Purchase Price”) equal to 100% of the principal amount thereof, plus any accrued and unpaid interest to, but excluding, the relevant Purchase Date, upon:

(i) delivery to the Paying Agent by the Holder of a written notice of purchase (a “Purchase Notice”) at any time from the opening of business on the date that is at least 20 business days prior to the relevant Purchase Date until the close of business on the fifth business day prior to such Purchase Date stating:

(A) the relevant Purchase Date;

(B) the certificate number(s) or CUSIP number(s) of the Notes which the Holder will deliver to be purchased;

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(C) the portion of the principal amount of the Notes which the Holder will deliver to be purchased, which portion must be a principal amount of $1,000 or an integral multiple thereof; and

(D) that such Notes shall be purchased as of the Purchase Date pursuant to the terms and conditions specified in the Notes and in this Indenture; and

(ii) delivery of such Notes to the Paying Agent prior to the close of business on the business day prior to the Purchase Date (together with all necessary endorsements) at the offices of the Paying Agent, such delivery being a condition to receipt by the Holder of the Purchase Price therefor.

(b) The Company shall purchase from the Holder thereof, pursuant to this Section 4.08, a portion of a Note if the principal amount of such portion is $1,000 or an integral multiple of $1,000. Provisions of this Indenture that apply to the purchase of all of a Note also apply to the purchase of such portion of such Note.

(c) Any purchase by the Company contemplated pursuant to the provisions of this Section 4.08 shall be consummated by the delivery of the Purchase Price promptly following the later of the Purchase Date and the time of delivery of the Note.

(d) Notwithstanding anything herein to the contrary, any Holder delivering to the Paying Agent the Purchase Notice contemplated by this Section 4.08 shall have the right to withdraw such Purchase Notice at any time prior to the close of business on the fifth business day prior to the Purchase Date by delivery of a written notice of withdrawal to the Paying Agent in accordance with Section 4.10. The Paying Agent shall promptly notify the Company of the receipt by it of any Purchase Notice or written notice of withdrawal thereof.

(e) On or before the 20^th business day prior to each Purchase Date, the Company shall deliver to the Trustee, the Paying Agent, each Holder and, if required by applicable law, each beneficial holder of Notes, a written notice stating:

(i) the Purchase Price payable on such Purchase Date;

(ii) procedures that Holders must follow to have their Notes purchased on the relevant Purchase Date;

(iii) the then current Conversion Price;

(iv) the name and address of the Paying Agent and Conversion Agent;

(v) that Holders who have delivered a Purchase Notice and who want to convert their Notes must first withdraw their Purchase Notice in accordance with the terms of this Indenture and such Holders must satisfy the requirements set forth in paragraph 9 of the Note;

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(vi) that Notes must be surrendered to the Paying Agent to collect the Purchase Price;

(vii) that, unless the Company defaults in making payment of such Purchase Price, the Notes so purchased will cease to be outstanding and interest and Liquidated Damages, if any, on the Notes so purchased will cease to accrue on and after the relevant Purchase Date;

(viii) that all rights of the Holder will terminate on and after the relevant Purchase Date (other than the right to receive the Purchase Price upon delivery or transfer of the Notes to be purchased); and

(ix) if fewer than all the outstanding Notes are to be purchased, the certificate/CUSIP number(s) and principal amounts of the particular Notes to be purchased.

(f) Simultaneously with delivering the written notice pursuant to Section 4.08(e) above, the Company shall publish a notice containing all information specified in such written notice in a newspaper of general circulation in The City of New York, or publish such information on the Company’s website, or through such other public medium that reasonably could be expected to inform Holders of such information.

(g) Procedure upon Purchase. The Company shall deposit the cash at the time and in the manner as provided in Section 4.11, in an amount sufficient to pay the aggregate Purchase Price of all Notes to be purchased pursuant to this Section 4.08.

SECTION 4.09 Repurchase at the Option of Holders Upon Designated Event.

(a) Following a Designated Event (the date of each such occurrence being the “Designated Event Date”), the Company shall notify the Holders in writing of such occurrence (such written notice referred to herein as the “Designated Event Notice”) and shall make an offer (the “Designated Event Offer”) to repurchase all Notes then outstanding at a repurchase price in cash (the “Designated Event Repurchase Price”) equal to 100% of the principal amount thereof, plus accrued and unpaid interest to, but excluding, the Designated Event Repurchase Date (as defined below). If the Designated Event Repurchase Date is an Interest Payment Date, the Company shall pay interest to the person in whose name the Note is registered on the relevant Regular Record Date.

(b) The Designated Event Notice shall be mailed by or at the direction of the Company to the Holders as shown on the Register of such Holders maintained by the Registrar not more than 30 days after the applicable Designated Event Date at the addresses as shown on the Register maintained by the Registrar, with a copy to the Trustee and the Paying Agent. The Designated Event Offer shall remain open until a specified date (the “Designated Event Offer Termination Date”) that is 20 business days from the date the Designated Event Notice is mailed. Prior to the Designated Event Offer Termination Date, Holders may elect to tender their Notes in whole or in part in integral multiples of $1,000 in exchange for cash. Payment shall be made by the Company in respect of Notes properly tendered pursuant to this Section (such date of payment

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being referred to herein as the “Designated Event Repurchase Date”) promptly following the Designated Event Offer Termination Date.

(c) The Designated Event Notice, which shall govern the terms of the Designated Event Offer, shall include a form of written notice of repurchase substantially in the form attached in Exhibit A hereto (the “Designated Event Repurchase Notice”) to be completed by the Holder and shall include such disclosures as are required by law and shall state:

(i) that a Designated Event Offer is being made pursuant to this Section 4.09 and that all Notes properly tendered will be accepted for payment;

(ii) the certificate number(s) or CUSIP number(s) of the Notes pursuant to which the Designated Event Offer is being made;

(iii) the event, transaction or transactions that constitute the Designated Event, the date of such Designated Event and that Holders have the right to elect to have their Notes repurchased in accordance with the Company’s Designated Event Offer;

(iv) the Designated Event Repurchase Price for each Note, the Designated Event Offer Termination Date and the Designated Event Repurchase Date;

(v) the name and address of the Paying Agent and the Conversion Agent;

(vi) that Notes as to which a Designated Event Repurchase Notice has been given may be converted pursuant to this Section 4.09 only if the Designated Event Repurchase Notice has been withdrawn in accordance with the terms of this Indenture;

(vii) that any Note not accepted for payment will continue to accrue interest and Liquidated Damages, if applicable, in accordance with the terms thereof;

(viii) that, unless the Company defaults on making the Designated Event Repurchase Price, any Note accepted for payment pursuant to the Designated Event Offer shall cease to accrue interest and Liquidated Damages, if any, on and after the Designated Event Repurchase Date and no further interest or Liquidated Damages, if any, shall accrue on or after such date and any conversion rights associated with any Note accepted for payment pursuant to the Designated Event Offer shall terminate on the Designated Event Offer Termination Date;

(ix) that Holders electing to have Notes repurchased pursuant to a Designated Event Offer will be required to surrender their Notes to the Paying Agent at the address specified in the Designated Event Notice prior to 5:00 p.m., New York City time, on the Designated Event Offer Termination Date and must complete any form letter of transmittal proposed by the Company and acceptable to the Trustee and the Paying Agent;

(x) that Holders will be entitled to withdraw their election if the Paying Agent receives, not later than 5:00 p.m., New York City time, on the Designated Event Offer Termination Date, a facsimile transmission or letter setting forth the name of the Holder,

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the principal amount of Notes the Holder delivered for purchase, the certificate number(s) or CUSIP number(s) of the Notes and a statement that such Holder is withdrawing his election to have such Notes purchased;

(xi) that Holders whose Notes are repurchased only in part will be issued new Notes equal in principal amount to the unpurchased portion of the Notes surrendered;

(xii) the procedures that Holders must follow in order to tender their Notes; and

(xiii) that in the case of a Designated Event Repurchase Date that is also an Interest Payment Date, the interest payment and Liquidated Damages, if any, due on such date shall be paid to the person in whose name the Note is registered at the close of business on the relevant Designated Event Offer Termination Date.

(d) A Holder may exercise its rights specified in this Section 4.09 upon delivery of a Designated Event Repurchase Notice to the Trustee with a copy to the Paying Agent at any time on or prior to the Designated Event Offer Termination Date.

(e) The delivery of a Holder’s Notes to the Trustee and the Paying Agent with the Designated Event Repurchase Notice (together with all necessary endorsements) at the office of the Trustee and the Paying Agent shall be a condition to the receipt by the Holder of the Designated Event Repurchase Price therefor; provided, however, that such Designated Event Repurchase Price shall be so paid pursuant to this Section 4.09 only if the Notes so delivered to the Trustee and the Paying Agent shall conform in all respects to the description thereof set forth in the related Designated Event Repurchase Notice.

(f) Notwithstanding anything herein to the contrary, any Holder delivering to the Paying Agent the Designated Event Repurchase Notice contemplated by this Section 4.09 shall have the right to withdraw such Designated Event Repurchase Notice at any time on or prior to the Designated Event Offer Termination Date by delivery of a written notice of withdrawal to the Paying Agent in accordance with Section 4.10. The Paying Agent shall promptly notify the Company of the receipt by it of any Designated Event Repurchase Notice or written withdrawal thereof.

(g) On the Designated Event Offer Termination Date, the Company shall (i) accept for payment all Notes or portions thereof properly tendered pursuant to the Designated Event Offer, (ii) deposit with the Paying Agent money sufficient to pay the Designated Event Repurchase Price with respect to all Notes or portions thereof so tendered and accepted and (iii) deliver or cause to be delivered to the Trustee for cancellation the Notes so accepted together with an Officers’ Certificate setting forth the aggregate principal amount of Notes or portions thereof tendered to and accepted for payment by the Company. On the Designated Event Repurchase Date, the Paying Agent shall mail or deliver the Designated Event Repurchase Price to the Holders so accepted and the Trustee shall promptly authenticate and mail or cause to be transferred by book-entry to such Holders a new Note equal in principal amount to any unpurchased portion of the Note surrendered, if any; provided that such new Notes will be in a principal amount of $1,000 or an integral multiple thereof. Any Notes not so accepted shall be promptly mailed or delivered by the Company to the Holder thereof.

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(h) In the case of any reclassification, change, consolidation, merger, share exchange, combination or sale or conveyance to which Section 11.06 applies in which the Common Stock of the Company is changed or exchanged as a result into the right to receive stock, securities or other property or assets (including cash) which includes shares of Common Stock of the Company or another person that are, or upon issuance will be, traded on a United States national securities exchange or approved for trading on an established automated over-the-counter trading market in the United States and such shares constitute at the time such change or exchange becomes effective in excess of 50% of the aggregate fair market value of such stock, securities other property and assets (including cash) (as determined by the Company, which determination shall be conclusive and binding), then the person formed by such consolidation or resulting from such merger or share exchange or which acquires such assets, as the case may be, shall execute and deliver to the Trustee a supplemental indenture (which shall comply with the TIA as in force at the date of execution of such supplemental indenture) modifying the provisions of this Indenture relating to the right of Holders to cause the Company to repurchase Notes following a Designated Event, including the applicable provisions of this Section 4.09 and the definition of Designated Event, as determined in good faith by the Company (which determination shall be conclusive and binding), to make such provision apply to such common stock and the issuer thereof if different from the Company and Common Stock of the Company (in lieu of the Company and the Common Stock of the Company).

SECTION 4.10 Effect of Purchase Notice or Designated Event Repurchase Notice.

(a) Upon receipt by the Paying Agent of the Purchase Notice or Designated Event Repurchase Notice specified in Section 4.08 or Section 4.09, as applicable, the Holder in respect of which such Purchase Notice or Designated Event Repurchase Notice, as the case may be, was given shall (unless such Purchase Notice or Designated Event Repurchase Notice is withdrawn as specified in the following two paragraphs) thereafter be entitled to receive solely the Purchase Price or Designated Event Repurchase Price, as the case may be, with respect to such Note. Such Purchase Price or Designated Event Repurchase Price shall be paid to such Holder, subject to receipt of funds by the Paying Agent, promptly following the later of (x) the Purchase Date or the Designated Event Offer Termination Date, as the case may be, with respect to such Note (provided the conditions in Section 4.08 or Section 4.09, as applicable, have been satisfied) and (y) the time of delivery of such Note to the Paying Agent by the Holder thereof in the manner required by Section 4.08 or Section 4.09, as applicable. Notes in respect of which a Purchase Notice or Designated Event Repurchase Notice, as the case may be, has been given by the Holder thereof may not be converted pursuant to Articles 11 and 12 hereof on or after the date of the delivery of such Purchase Notice or Designated Event Repurchase Notice, as the case may be, unless such Purchase Notice or Designated Event Repurchase Notice, as the case may be, has first been validly withdrawn as specified in the following paragraph.

(b) A Purchase Notice or Designated Event Purchase Notice, as the case may be, may be withdrawn by means of a written notice of withdrawal delivered to the office of the Paying Agent in accordance with the Purchase Notice or Designated Event Purchase Notice, as the case may be, at any time prior to the close of business on the Purchase Date or the Designated Event Payment Date, as the case may be, specifying:

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(i) the principal amount of the Note with respect to which such notice of withdrawal is being submitted;

(ii) the certificate number(s) or CUSIP number(s) of the Note in respect of which such notice of withdrawal is being submitted; and

(iii) the principal amount, if any, of such Note which remains subject to the original Purchase Notice or Designated Event Repurchase Notice, as the case may be, and which has been or will be delivered for purchase by the Company.

(c) There shall be no purchase of any Notes pursuant to Section 4.08 if there has occurred (prior to, on or after, as the case may be, the giving, by the Holders of such Notes of the required Purchase Notice) and is continuing an Event of Default (other than a default in the payment of the Purchase Price with respect to such Notes). The Paying Agent will promptly return to the respective Holders thereof any Notes (x) with respect to which a Purchase Notice has been delivered in compliance with this Indenture, or (y) held by it during the continuance of an Event of Default (other than a default in the payment of the Purchase Price with respect to such Notes), in which case, upon such return, the Purchase Notice with respect thereto shall be deemed to have been withdrawn.

SECTION 4.11 Deposit of Purchase Price or Designated Event Repurchase Price.

(a) Prior to 10:00 a.m. (New York City time) on the Purchase Date or the Designated Event Repurchase Date, as the case may be, the Company shall deposit with the Trustee or with the Paying Agent (or, if the Company or a subsidiary or an Affiliate of either of them is acting as the Paying Agent in connection with a purchase pursuant to Section 4.08, shall segregate and hold in trust as provided in Section 2.04) an amount of money (in immediately available funds if deposited on such business day) sufficient to pay the aggregate Purchase Price or Designated Event Repurchase Price, as the case may be, of all the Notes or portions thereof which are to be purchased as of the Purchase Date or Designated Event Repurchase Date, as the case may be.

(b) If the Paying Agent holds money sufficient to pay in full the relevant Purchase Price or Designated Event Repurchase Price, as applicable, for all Notes to be purchased on the relevant Purchase Date or Designated Event Repurchase Date, as applicable, other than Notes or portions of Notes which on or prior thereto have been delivered by the Company to the Trustee for cancellation or have been converted, the Notes will cease to be outstanding immediately following the close of business on the relevant Purchase Date or Designated Event Repurchase Date, as applicable, and interest and Liquidated Damages, if any, on the Notes so purchased will cease to accrue on and after such Purchase Date or Designated Event Repurchase Date, as applicable. In such event, all rights of the Holder will terminate on and after the relevant Purchase Date or Designated Event Repurchase Date, as applicable, other than the right to receive the relevant Purchase Price or Designated Event Repurchase Price, as applicable, upon delivery or transfer of the Notes to be so purchased.

SECTION 4.12 Notes Purchased in Part.

Any Note which is to be purchased only in part shall be surrendered at the office of the Paying Agent (with, if the Company or the Trustee so requires, due endorsement by, or a written

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instrument of transfer in form satisfactory to the Company and the Trustee duly executed by, the Holder thereof or such Holder’s attorney duly authorized in writing) and the Company shall execute and the Trustee shall authenticate and deliver to the Holder of such Note, without service charge, a new Note or Notes, of any authorized denomination as requested by such Holder in aggregate principal amount equal to, and in exchange for, the portion of the principal amount of the Notes so surrendered which is not purchased.

SECTION 4.13 Covenant to Comply with Securities Laws upon Purchase of Convertible Senior Notes.

In connection with any offer to purchase or purchase of Notes under Section 4.08 or 4.09 hereof (provided that such offer or purchase constitutes an “issuer tender offer” for purposes of Rule 13e-4 (which term, as used herein, includes any successor provision thereto) under the Exchange Act at the time of such offer or purchase), the Company shall, to the extent applicable, (i) comply with Rule 13e-4 and Rule 14e-1 under the Exchange Act, (ii) file the related Schedule TO (or any successor schedule, form or report) under the Exchange Act, and (iii) otherwise comply with all federal and state securities laws so as to permit the rights and obligations under Sections 4.08 and 4.09 to be exercised in the time and in the manner specified in Sections 4.08 and 4.09.

SECTION 4.14 Repayment to the Company.

The Trustee and the Paying Agent shall return to the Company any cash that remains unclaimed, together with interest or dividends, if any, thereon (subject to the provisions of Section 7.01(f)), held by them for the payment of the Purchase Price or Designated Event Repurchase Price, as the case may be; provided, however, that to the extent that the aggregate amount of cash deposited by the Company pursuant to Section 4.11 exceeds the aggregate Purchase Price or Designated Event Repurchase Price, as the case may be, with respect to the Notes or portions thereof which the Company is obligated to purchase as of the Purchase Date or Designated Event Repurchase Date, as the case may be, whether as a result of withdrawal or otherwise, then promptly after the business day following the Purchase Date or Designated Event Repurchase Date, as the case may be, the Trustee shall return any such excess to the Company together with interest or dividends, if any, thereon (subject to the provisions of Section 7.01(f)).

ARTICLE 5

SUCCESSORS

SECTION 5.01 Company May Consolidate, etc., Only on Certain Terms

The Company shall not consolidate with or merge into any other person or convey, transfer or lease its properties and assets substantially as an entirety to any person, and the Company shall not permit any person to consolidate with or merge into the Company or convey, transfer or lease its properties and assets substantially as an entirety to the Company unless:

(a) either:

(i) the Company shall be the continuing corporation; or

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(ii) the person formed by or surviving any such consolidation or share exchange or into which the Company is merged (if other than the Company) or the person which acquires by sale, assignment, transfer, lease, conveyance or other disposition the properties and assets of the Company as an entirety or substantially as an entirety:

(1) shall be a corporation, partnership or trust organized under the laws of the United States or any State thereof or the District of Columbia; and

(2) shall expressly assume, by supplemental indenture in form reasonably satisfactory to the Trustee, executed and delivered to the Trustee, in form satisfactory to the Trustee, the due and punctual payment of the principal of and interest and Liquidated Damages, if any, on all of the Notes and the performance or observance of every covenant of the Notes and this Indenture on the part of the Company to be performed or observed, including, without limitation, modifications to rights of Holders to cause the repurchase of Notes upon a Designated Event in accordance with Section 4.09(h) and conversion rights in accordance with Section 11.06 to the extent required by such Sections;

(b) in all cases, immediately after giving effect to such transaction no Default and no Event of Default shall have occurred and be continuing; and

(c) the Company shall have delivered to the Trustee an Officers’ Certificate and an Opinion of Counsel, each stating that such consolidation, merger, conveyance, transfer or lease and, if a supplemental indenture is required in connection with such transaction, such supplemental indenture comply with this Article and that all conditions precedent herein provided for relating to such transaction have been complied with.

SECTION 5.02 Successor Corporation Substituted.

Upon any consolidation of the Company with, or merger of the Company into, any other person or any conveyance, transfer or lease of the properties and assets of the Company substantially as an entirety in accordance with this Article 5, the successor person formed by such consolidation or into which the Company is merged or into which such conveyance, transfer or lease is made shall succeed to, and be substituted for, and may exercise every right and power of, the Company under this Indenture with the same effect as if such successor person had been named as the Company herein, and thereafter, except in the case of a lease, the predecessor person shall be relieved of all obligations and covenants under this Indenture and the Notes.

SECTION 5.03 Repurchase at the Option of Holders upon Designated Event.

This Article 5 does not affect the obligations of the Company (including without limitation any successor to the Company) under Section 4.09.

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ARTICLE 6

DEFAULTS AND REMEDIES

SECTION 6.01 Events of Default.

An “Event of Default” with respect to any Notes shall be deemed to have occurred if:

(a) the Company defaults in the payment of principal of the Notes when due upon redemption, repurchase or otherwise; or

(b) the Company defaults in the payment of any installment of interest or Liquidated Damages on the Notes when due (including any interest payable in connection with a repurchase pursuant to Section 4.08 or Section 4.09 and a redemption pursuant to Section 4.01) and continuance of such default for 30 days or more; or

(c) the Company fails to comply or observe in any material respect (other than a default set forth in clauses (a) and (b) above and clause (d) below) any other covenant or agreement of the Company in respect of the Notes set forth in this Indenture or the Notes, and fails to remedy such default or breach within a period of 60 days after the receipt of written notice to the Company from the Trustee or to the Company and the Trustee from the Holders of at least 25% in aggregate principal amount of the Notes then outstanding; or

(d) the Company defaults in the payment of the Designated Event Repurchase Price in respect of the Notes when the same becomes due and payable; or

(e) a default under any credit agreement, mortgage, indenture or instrument under which there may be issued or by which there may be secured or evidenced any Indebtedness for money borrowed by the Company or any Restricted Subsidiary, other than any such Indebtedness which is non-recourse to the Company or any Restricted Subsidiary, whether such Indebtedness exists on the date of this Indenture or shall hereafter be created, which default (i) is caused by a failure to pay when due any principal on such Indebtedness at the final stated maturity date of such Indebtedness (which failure continues beyond any applicable grace period) (a “Payment Default”) or (ii) results in the acceleration of such Indebtedness prior to its express maturity (without such acceleration being rescinded or annulled) and, in each case, the principal amount of such Indebtedness, together with the principal amount of any other such Indebtedness under which there is a Payment Default or the maturity of which has been so accelerated, aggregates to $75,000,000 or more and such Payment Default is not cured or such acceleration is not annulled within 30 days after receipt of written notice to the Company from the Trustee or to the Company and the Trustee from Holders of at least 25% in aggregate principal amount of the Notes then outstanding; or

(f) the entry by a court having jurisdiction in the premises of (i) a decree or order for relief in respect of the Company in an involuntary case or proceeding under any Bankruptcy Law, or (ii) a decree or order adjudging the Company bankrupt or insolvent, or approving as properly filed a petition seeking reorganization, arrangement, adjustment or composition of or in respect of the Company under any applicable U.S. federal or state law, or appointing a custodian, receiver, liquidator, assignee, trustee, sequestrator or other similar official of the Company or of

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any substantial part of its property, or ordering the winding-up or liquidation of its affairs, and the continuance of any such decree or order for relief or any such other decree or order unstayed and in effect for a period of 60 consecutive days; or

(g) the commencement by the Company of a voluntary case or proceeding under any Bankruptcy Law or any other case or proceeding to be adjudicated bankrupt or insolvent, or the consent by it to the entry of a decree or order for relief in respect of the Company in an involuntary case or proceeding under any Bankruptcy Law or to the commencement of any bankruptcy or insolvency case or proceeding against it, or the filing by it of a petition or answer or consent seeking reorganization or relief under any Bankruptcy Law, or the consent by it to the filing of such petition or to the appointment of or taking possession by a custodian, receiver, liquidator, assignee, trustee, sequestrator or other similar official of the Company or of any substantial part of its property, or the making by it of an assignment for the benefit of creditors, or the admission by it in writing of its inability to pay its debts generally as they become due.

The term “Bankruptcy Law” means Title 11, U.S. Code or any similar Federal or state law for the relief of debtors. The term “Custodian” means any receiver, trustee, assignee, liquidator or similar official under any Bankruptcy Law.

SECTION 6.02 Acceleration.

(a) If an Event of Default (other than an Event of Default specified in clauses (f) and (g) of Section 6.01) occurs and is continuing, then and in every such case the Trustee, by written notice to the Company, or the Holders of at least 25% in aggregate principal amount of the Notes then outstanding, by written notice to the Company and the Trustee, may declare the unpaid principal of and accrued and unpaid interest and Liquidated Damages, if any, on all the Notes then outstanding to be due and payable. Upon such declaration such principal amount and accrued and unpaid interest and Liquidated Damages, if any, shall become immediately due and payable, notwithstanding anything contained in this Indenture or the Notes to the contrary. If any Event of Default specified in clauses (f) or (g) of Section 6.01 occurs, all unpaid principal of and accrued and unpaid interest and Liquidated Damages, if any, on the Notes then outstanding shall become automatically due and payable, without any declaration or other act on the part of the Trustee or any Holder.

(b) The Holders of a majority in aggregate principal amount of the Notes then outstanding by written notice to the Trustee may rescind any acceleration of the Notes and its consequences if all existing Events of Default (other than nonpayment of principal of and interest and Liquidated Damages, if any, on the Notes which has become due solely by virtue of such acceleration) have been cured or waived and if the rescission would not conflict with any judgment or decree of any court of competent jurisdiction. No such rescission shall affect any subsequent Default or Event of Default or impair any right consequent thereto.

SECTION 6.03 Other Remedies.

If an Event of Default occurs and is continuing, the Trustee may pursue any available remedy by proceeding at law or in equity to collect the payment of principal of or interest or Liquidated Damages, if any, on the Notes or to enforce the performance of any provision of the

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Notes or this Indenture. The Trustee may maintain a proceeding even if it does not possess any of the Notes or does not produce any of them in the proceeding. A delay or omission by the Trustee or any Holder in exercising any right or remedy occurring upon an Event of Default shall not impair the right or remedy or constitute a waiver of or acquiescence in the Event of Default. All remedies are cumulative to the extent permitted by law.

SECTION 6.04 Waiver of Past Defaults.

The Holders of a majority in aggregate principal amount of the Notes then outstanding may, on behalf of the Holders of all the Notes then outstanding, waive any past Default or Event of Default and its consequences, except a Default or Event of Default in the payment of the principal or interest or Liquidated Damages, if applicable, on the Notes (other than the non-payment of principal, interest or Liquidated Damages, if any, on the Notes which has become due solely by virtue of an acceleration which has been duly rescinded as provided above), or in respect of a covenant or provision of this Indenture which cannot be modified or amended without the consent of all Holders. When a Default or Event of Default is waived, it is cured and stops continuing. No waiver shall extend to any subsequent or other Default or Event of Default or impair any right consequent thereon.

SECTION 6.05 Control by Majority.

The Holders of a majority in aggregate principal amount of the Notes then outstanding may direct the time, method and place of conducting any proceeding for any remedy available to the Trustee or exercising any trust or power conferred on the Trustee. However, the Trustee may refuse to follow any direction that conflicts with law or this Indenture that the Trustee determines may be unduly prejudicial to the rights of other Holders or that may involve the Trustee in personal liability; provided that the Trustee shall have no duty or obligation (subject to Section 7.01) to ascertain whether or not such actions of forebearances are unduly prejudicial to such Holders; provided, further, that the Trustee may take any other action the Trustee deems proper that is not inconsistent with such directions.

SECTION 6.06 Limitation on Suits.

A Holder may not pursue any remedy with respect to this Indenture or the Notes unless:

(a) the Holder gives to the Trustee written notice of a continuing Event of Default on the Notes;

(b) the Holders of at least 25% in principal amount of the Notes then outstanding make a written request to the Trustee to pursue the remedy;

(c) such Holders offer and, if requested, provide to the Trustee indemnity reasonably satisfactory to the Trustee against any cost, expense or liability;

(d) the Trustee does not act on the request on or prior to the 60^th day after receipt of the request and the offer and, if requested, the provision of indemnity; and

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(e) during such 60-day period the Holders of a majority in principal amount of the Notes then outstanding do not give the Trustee a direction inconsistent with the request.

A Holder may not use this Indenture to prejudice the rights of another Holder or to obtain a preference or priority over another Holder. This Section 6.06 does not affect the right of the Holders to bring an action for enforcement of the payment of the principal of or interest or Liquidated Damages, if any, the Redemption Price, Purchase Price or Designated Event Repurchase Price, as applicable, on such Holders’ Notes on or after the respective due dates expressed in the Notes or such Holders’ right to convert its Notes in accordance with the terms of this Indenture.

SECTION 6.07 Rights of Holders to Receive Payment.

Notwithstanding any other provision of this Indenture, the right of any Holder to receive payment of principal and interest and Liquidated Damages, if any, the Redemption Price, Purchase Price or Designated Event Repurchase Price, as applicable, on the Notes, on or after the respective due dates expressed in the Notes, or to bring suit for the enforcement of any such payment on or after such respective dates, or to bring suit for the enforcement of the right to convert the Notes shall not be impaired or affected without the consent of the Holder.

SECTION 6.08 Collection Suit by Trustee.

If an Event of Default specified in Section 6.01(a), (b) or (d) occurs and is continuing, the Trustee may recover judgment in its own name and as trustee of an express trust against the Company for the whole amount of principal, and interest and Liquidated Damages, if any, and Redemption Price, Purchase Price and Designated Event Repurchase Price, if applicable, remaining unpaid on the Notes and interest on overdue principal, interest and Liquidated Damages, if any, and Redemption Price, Purchase Price and Designated Event Repurchase Price, if applicable, and such further amount as shall be sufficient to cover the costs and, to the extent lawful, expenses of collection, including the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel.

SECTION 6.09 Trustee May File Proofs of Claim.

The Trustee may file such proofs of claim and other papers or documents as may be necessary or advisable in order to have the claims of the Trustee and the Holders allowed in any judicial proceedings relative to the Company, its creditors or its property. Nothing contained herein shall be deemed to authorize the Trustee to authorize or consent to or accept or adopt on behalf of any Holder any plan of reorganization, arrangement, adjustment or composition affecting the Notes or the rights of any Holder thereof, or to authorize the Trustee to vote in respect of the claim of any Holder in any such proceeding.

SECTION 6.10 Priorities.

If the Trustee collects any money pursuant to this Article, it shall pay out the money in the following order:

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First: to the Trustee for amounts due under Section 7.07, including payment of all compensation, expenses and liabilities incurred, and all advances made, by the Trustee, and the costs and expenses of collection;

Second: to Holders for amounts due and unpaid on the Notes for principal, interest and Liquidated Damages, if any, and the Redemption Price, Purchase Price and Designated Event Repurchase Price, if applicable, ratably, without preference or priority of any kind, according to the amounts due and payable on the Notes for principal, interest and Liquidated Damages, if any, and the Redemption Price, Purchase Price and Designated Event Repurchase Price, if applicable, respectively; and

Third: to the Company.

Except as otherwise provided in Section 2.12, the Trustee may fix a record date and payment date for any payment to Holders.

SECTION 6.11 Undertaking for Costs.

In any suit for the enforcement of any right or remedy under this Indenture or in any suit against the Trustee for any action taken or omitted by it as a Trustee, a court in its discretion may require the filing by any party litigant in the suit, other than the Trustee, of an undertaking to pay the costs of the suit, and the court in its discretion may assess reasonable costs, including reasonable attorneys fees, against any party litigant in the suit, having due regard to the merits and good faith of the claims or defenses made by the party litigant. This Section does not apply to a suit by the Trustee, a suit by a Holder pursuant to Section 6.07 or a suit by Holders of more than 10% in principal amount of the Notes then outstanding.

ARTICLE 7

THE TRUSTEE

The Trustee hereby accepts the trust imposed upon it by this Indenture and covenants and agrees to perform the same, as herein expressed. Whether or not herein expressly so provided, every provision of this Indenture relating to the conduct or affecting the liability of or affording protection to the Trustee shall be subject to the provisions of this Article 7.

SECTION 7.01 Duties of the Trustee.

(a) If an Event of Default known to a Trust Officer of the Trustee has occurred and is continuing, the Trustee shall exercise such of the rights and powers vested in it by this Indenture and use the same degree of care and skill in their exercise as a prudent person would exercise or use under the circumstances in the conduct of his or her own affairs.

(b) Except during the continuance of an Event of Default known to the Trustee:

(i) The duties of the Trustee shall be determined solely by the express provisions of this Indenture, and the Trustee need perform only those duties that are

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specifically set forth in this Indenture and no others, and no implied covenants or obligations shall be read into this Indenture against the Trustee; and

(ii) In the absence of bad faith on its part, the Trustee may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon any statements, certificates or opinions furnished to the Trustee and conforming to the requirements of this Indenture. However, the Trustee shall examine the certificates and opinions to determine whether or not they conform to the form required by this Indenture.

(c) The Trustee may not be relieved from liability for its own negligent action, its own negligent failure to act or its own willful misconduct, except that:

(i) This paragraph does not limit the effect of paragraph (b) of this Section;

(ii) The Trustee shall not be liable for any error of judgment made in good faith by a Trust Officer, unless it is proved that the Trustee was negligent in ascertaining the pertinent facts; and

(iii) The Trustee shall not be liable with respect to any action it takes or omits to take in good faith in accordance with a direction received by it pursuant to Section 6.06.

(d) Whether or not therein expressly so provided, every provision of this Indenture that is in any way related to the Trustee is subject to paragraphs (a), (b) and (c) of this Section 7.01.

(e) No provision of this Indenture shall require the Trustee to expend or risk its own funds or incur any financial liability in the performance of any of its duties or the exercise of any of its rights and powers hereunder, if it shall have reasonable grounds for believing that repayment of such funds or adequate indemnity against such risk of liability is not reasonably assured to it.

(f) The Trustee shall not be liable for interest on any money received by it except as the Trustee may agree in writing with the Company. Money held in trust by the Trustee need not be segregated from other funds except to the extent required by law.

SECTION 7.02 Rights of the Trustee.

(a) The Trustee may conclusively rely on and shall be protected in acting or refraining from acting upon any resolution, Officers’ Certificate, or any other certificate, statement, instrument, opinion, report, notice, request, consent, order, security or other document believed in good faith by it to be genuine and to have been signed or presented by the proper person. The Trustee need not investigate any fact or matter contained therein.

(b) Any request, direction, order or demand of the Company mentioned herein shall be sufficiently evidenced by an Officers’ Certificate (unless other evidence in respect thereof is herein specifically prescribed). In addition, before the Trustee acts or refrains from acting, it may require an Officers’ Certificate, an Opinion of Counsel or both. The Trustee shall not be

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liable for any action it takes or omits to take in good faith in reliance on such Officers’ Certificate or Opinion of Counsel. The Trustee may consult with counsel and the advice of such counsel or any Opinion of Counsel shall be full and complete authorization and protection from liability in respect of any action taken, suffered or omitted by it hereunder in good faith and in reliance thereon.

(c) The Trustee may execute any of the trusts or powers hereunder or perform any duties hereunder either directly or by or through its attorneys and agents and other persons not regularly in its employ and shall not be responsible for the misconduct or negligence of any attorney or agent appointed with due care.

(d) The Trustee shall not be liable for any action it takes or omits to take in good faith without negligence or willful misconduct which it believes to be authorized or within its discretion, rights or powers.

(e) Unless otherwise specifically provided in this Indenture, any demand, request, direction or notice from the Company shall be sufficient if signed by Officers of the Company.

(f) The Trustee shall not be required to give any bond or surety in respect of the performance of its powers and duties hereunder.

(g) The Trustee shall be under no obligation to exercise any of the rights or powers vested in it by this Indenture at the request, order or discretion of any of the Holders pursuant to the provisions of this Indenture, unless such Holders have offered to the Trustee security or indemnity satisfactory to it against the costs, expenses and liabilities which might be incurred therein or thereby.

(h) The Trustee shall not be bound to make any investigation into the facts or matters stated in any resolution, certificate, statement, instrument, opinion, report, notice, request, consent, order, security or other document unless requested in writing to do so by the Holders of not less than a majority in aggregate principal amount of the Notes then outstanding, provided that if the Trustee determines in its discretion to make any such investigation, then it shall be entitled, upon reasonable prior notice and during normal business hours, to examine the books and records and the premises of the Company, personally or by agent or attorney, and the reasonable expenses of every such examination shall be paid by the Company or, if paid by the Trustee or any predecessor Trustee, shall be reimbursed by the Company upon demand.

(i) The permissive rights of the Trustee to do things enumerated in this Indenture shall not be construed as a duty, and the Trustee shall not be answerable for other than its negligence or willful misconduct.

(j) The Trustee shall not be responsible for the computation of any adjustment to the Conversion Price or for any determination as to whether an adjustment is required and shall not be deemed to have knowledge of any adjustment unless and until it shall have received the notice from the Company contemplated by Section 11.05(k).

(k) The rights, privileges, protections, immunities and benefits given to the Trustee, including, without limitation, its right to be indemnified, are extended to, and shall be

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enforceable by, the Trustee in each of its capacities hereunder, and each agent, custodian and other Person employed to act hereunder.

(l) The Trustee may request that the Company deliver an Officers’ Certificate setting forth the names of individuals and/or titles of officers authorized at such time to take specified actions pursuant to this Indenture, which Officers’ Certificate may be signed by any person authorized to sign an Officers’ Certificate, including any person specified as so authorized in any such certificate previously delivered and not superseded.

SECTION 7.03 Individual Rights of the Trustee.

Subject to Sections 7.10 and 7.11, the Trustee in its individual or any other capacity may become the owner or pledgee of Notes with the same rights it would have if it were not the Trustee and may otherwise deal with the Company or an Affiliate of the Company and receive, collect, hold and retain collections from the Company with the same rights it would have if it were not Trustee. Any Agent may do the same with like rights.

SECTION 7.04 Trustee’s Disclaimer.

The Trustee shall not be responsible for and makes no representation as to the validity or adequacy of this Indenture or the Notes. It shall not be accountable for the Company’s use of the proceeds from the Notes or any money paid to the Company or upon the Company’s direction under any provision of this Indenture. It shall not be responsible for the use or application of any money received by any Paying Agent other than the Trustee, and it shall not be responsible for any statement or recital herein or any statement in the Notes or any other document in connection with the sale of the Notes or pursuant to this Indenture other than its certificate of authentication.

SECTION 7.05 Notice of Defaults.

If a Default or Event of Default occurs and is continuing and if it is known to a Trust Officer of the Trustee, the Trustee shall mail to each Holder a notice of the Default or Event of Default within 90 days after the occurrence of such Default or Event of Default. A Default or an Event of Default shall not be considered known to a Trust Officer of the Trustee unless it is a Default or Event of Default in the payment of principal, interest or Liquidated Damages, if any, when due under Section 6.01(a), (b) or (d) (including any principal or interest payable in connection with a repurchase pursuant to Section 4.08 or Section 4.09 and a redemption pursuant to Section 4.01), or a Trust Officer of the Trustee shall have received notice thereof, in accordance with this Indenture, from the Company or from the Holders of a majority in principal amount of the outstanding Notes. Except in the case of a Default or Event of Default in payment of principal of, or interest or Liquidated Damages, if any, or payment of any Redemption Price, Purchase Price or Designated Event Repurchase Price, if applicable, on any Note, the Trustee may withhold the notice if and so long as a committee of its Trust Officers in good faith determines that withholding the notice is in the interest of the Holders.

SECTION 7.06 Reports by the Trustee to Holders.

(a) Within 60 days after the reporting date stated in Section 10.10, the Trustee shall mail to Holders a brief report dated as of such reporting date that complies with TIA § 313(a) (but if

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no event described in TIA § 313(a) has occurred within twelve months preceding the reporting date, no report need be transmitted). The Trustee also shall comply with TIA § 313(b)(2). The Trustee shall also transmit by mail all reports as required by TIA § 313(c).

(b) A copy of each report at the time of its mailing to Holders shall be filed, at the expense of the Company, by the Trustee with the Commission and each stock exchange or securities market, if any, on which the Notes are listed or quoted. The Company shall timely notify the Trustee when the Notes are listed or quoted on any stock exchange or securities market.

SECTION 7.07 Compensation and Indemnity.

(a) The Company shall pay to the Trustee from time to time, and the Trustee shall be entitled to such compensation for its acceptance of this Indenture and its services hereunder as the Company and the Trustee shall from time to time agree in writing. The Trustee’s compensation shall not be limited by any law on compensation of a trustee of an express trust. The Company shall reimburse the Trustee promptly upon request for all reasonable disbursements, advances and expenses incurred or made by or on behalf of it in addition to the compensation for its services. Such expenses may include the reasonable compensation, disbursements and expenses of the Trustee’s agents, counsel and other persons not regularly in its employ.

(b) The Company shall indemnify the Trustee against, and defend and hold the Trustee harmless from, any loss, liability or expense incurred by it arising out of or in connection with the acceptance or administration of its duties under this Indenture and the trusts hereunder, including the costs and expenses of defending itself against or investigating any claim of liability in the premises, except as set forth in the next paragraph. The Trustee shall notify the Company promptly of any claim for which it may seek indemnity. Failure by the Trustee to so notify the Company shall not relieve the Company of its obligations hereunder. The Company shall defend the claim with counsel designated by the Company, who may be outside counsel to the Company but shall in all events be reasonably satisfactory to the Trustee, and the Trustee shall cooperate in the defense. In addition, the Trustee may retain one separate counsel and, if deemed advisable by such counsel, local counsel, and the Company shall pay the reasonable fees and expenses of such separate counsel and local counsel. The indemnification herein extends to any settlement, provided that the Company will not be liable for any settlement made without its consent, provided, further, that such consent will not be unreasonably withheld.

(c) The Company need not reimburse any expense or indemnify against any loss or liability incurred by the Trustee through its own negligence or willful misconduct.

(d) The Trustee shall have a lien prior to the Notes on all money or property held or collected by the Trustee to secure the Company’s payment obligations in this Section 7.07, except that held in trust to pay principal, interest and Liquidated Damages, if any, on the Notes. Such liens and the Company’s obligations under this Section 7.07 shall survive the satisfaction and discharge of this Indenture.

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(e) When the Trustee incurs expenses or renders services after an Event of Default specified in Section 6.01(f) or (g) occurs, the expenses and the compensation for the services (including the fees and expenses of its agents and counsel) are intended to constitute expenses of administration under any Bankruptcy Law.

SECTION 7.08 Replacement of the Trustee.

(a) A resignation or removal of the Trustee and appointment of a successor Trustee shall become effective only upon the successor Trustee’s acceptance of appointment as provided in this Section 7.08.

(b) The Trustee may resign at any time and be discharged from the trust hereby created by so notifying the Company. The Holders of a majority in principal amount of the Notes then outstanding may remove the Trustee by so notifying the Trustee and the Company in writing and may appoint a successor Trustee. The Company may remove the Trustee if:

(i) the Trustee fails to comply with Section 7.10;

(ii) the Trustee is adjudged a bankrupt or an insolvent or an order for relief is entered with respect to the Trustee under any Bankruptcy Law;

(iii) a Custodian or public officer takes charge of the Trustee or its property; or

(iv) the Trustee becomes incapable of acting.

(c) If the Trustee resigns or is removed or if a vacancy exists in the office of Trustee for any reason, the Company shall promptly appoint a successor Trustee. Within one year after the successor Trustee takes office, the Holders of a majority in principal amount of the Notes then outstanding may appoint a successor Trustee to replace the successor Trustee appointed by the Company.

(d) If a successor Trustee does not take office within 60 days after the retiring Trustee resigns or is removed, the retiring Trustee, at the Company’s expense, the Company or the Holders of at least 10% in principal amount of the Notes then outstanding may petition any court of competent jurisdiction for the appointment of a successor Trustee.

(e) If the Trustee after written request by any Holder who has been a Holder for at least six months fails to comply with Section 7.10, such Holder may petition any court of competent jurisdiction for the removal of the Trustee and the appointment of a successor Trustee.

(f) A successor Trustee shall deliver a written acceptance of its appointment to the retiring Trustee and to the Company. Thereupon, the resignation or removal of the retiring Trustee shall become effective, and the successor Trustee shall have all the rights, powers and duties of the Trustee under this Indenture. The successor Trustee shall mail a notice of its succession to Holders. The retiring Trustee shall promptly transfer all property held by it as Trustee to the successor Trustee, provided that all sums owing to the retiring Trustee hereunder have been paid and subject to the lien provided for in Section 7.07. Notwithstanding the replacement of the Trustee pursuant to this Section 7.08, the Company’s obligations under

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Section 7.07 shall continue for the benefit of the retiring Trustee with respect to expenses and liabilities incurred by it prior to such replacement.

(g) Upon request of any such successor Trustee, the Company shall execute any and all instruments for more fully and certainly vesting in and confirming to such successor Trustee all such rights, powers and trusts referred to in the preceding paragraph.

SECTION 7.09 Successor Trustee by Merger, etc.

If the Trustee consolidates with, merges or converts into, or transfers all or substantially all of its corporate trust business (including the trust created by this Indenture) to, another corporation or national banking association, the resulting, surviving or transferee corporation or national banking association without any further act shall be the successor Trustee with the same effect as if the successor Trustee had been named as the Trustee herein.

SECTION 7.10 Eligibility, Disqualification.

This Indenture shall always have a Trustee who satisfies the requirements of TIA § 310(a)(1). The Trustee shall always have a combined capital and surplus as stated in Section 10.11. The Trustee is subject to TIA § 310(b) regarding the disqualification of a trustee upon acquiring a conflicting interest.

SECTION 7.11 Preferential Collection of Claims Against Company.

The Trustee shall comply with TIA § 311(a), excluding any creditor relationship set forth in TIA § 311(b). A Trustee who has resigned or been removed shall be subject to TIA § 311(a) to the extent indicated therein.

ARTICLE 8

SATISFACTION AND DISCHARGE OF INDENTURE

SECTION 8.01 Discharge of Indenture.

When:

(a) the Company delivers to the Trustee for cancellation all Notes theretofore authenticated pursuant to this Indenture (other than any other Notes which have been destroyed, lost or stolen and in lieu of or in substitution for which other Notes have been authenticated and delivered) and not theretofore cancelled; or

(b) (i) all the Notes not theretofore cancelled or delivered to the Trustee for cancellation have become due and payable, and (ii) the Company deposits with the Trustee, the Paying Agent or the Conversion Agent, as applicable, in trust, amounts in cash or shares of Common Stock (as applicable in accordance with the terms hereof) sufficient to pay, whether at stated maturity, or any Redemption Date, or any Purchase Date, or any Designated Event Repurchase Date, or upon conversion or otherwise, all of the Notes (other than any Notes which have been mutilated, destroyed, lost or stolen and in lieu of

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or in substitution for which other Notes have been authenticated and delivered) not theretofore cancelled or delivered to the Trustee for cancellation, including principal, interest and Liquidated Damages, if any, due and (iii) the Company also pays, or causes to be paid, all other sums payable hereunder by the Company, including the Redemption Price, Purchase Price and Designated Event Repurchase Price, if applicable,

then this Indenture shall cease to be of further effect, except, in the case of paragraph (b) above, as to:

(A) rights of registration of transfer, substitution, replacement and exchange and conversion of Notes;

(B) rights hereunder of Holders to receive payments of principal of and interest and Liquidated Damages, if any, and the Redemption Price, Purchase Price and Designated Event Repurchase Price, if applicable, on, the Notes;

(C) the obligations under Sections 2.03 and 8.05 hereof; and

(D) the rights, obligations and immunities of the Trustee hereunder,

and the Trustee, on written demand of the Company accompanied by an Officers’ Certificate and an Opinion of Counsel as required by Section 10.04, and at the Company’s cost and expense, shall execute proper instruments acknowledging satisfaction and discharging of this Indenture. The Company, however, hereby agrees to reimburse the Trustee for any costs or expenses thereafter reasonably and properly incurred by the Trustee and to compensate the Trustee for any services thereafter reasonably and properly rendered by the Trustee in connection with this Indenture or the Notes.

SECTION 8.02 Deposited Monies to Be Held in Trust by Trustee.

Subject to Section 8.04, all monies deposited with the Trustee pursuant to Section 8.01 shall be held in trust and applied by it to the payment either directly or through the Paying Agent, to the Holders of the particular Notes for the payment of which such monies have been deposited with the Trustee, of all sums due and to become due thereon for principal, interest, and Liquidated Damages, if any, and the Redemption Price, Purchase Price and Designated Event Repurchase Price, if applicable.

SECTION 8.03 Paying Agent to Repay Monies Held.

Upon the satisfaction and discharge of this Indenture, all monies then held by any Paying Agent (other than the Trustee and not pursuant to Section 8.01) shall, upon the Company’s demand, be repaid to it or paid to the Trustee, and thereupon such Paying Agent shall be released from all further liability with respect to such monies.

SECTION 8.04 Return of Unclaimed Monies.

Subject to the requirements of applicable law, any monies deposited with or paid to the Trustee for payment of the principal of or interest or Liquidated Damages, if any, and the

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Redemption Price, Purchase Price and Designated Event Repurchase Price, if applicable, on the Notes and not applied but remaining unclaimed by the Holders thereof for two years after the date upon which the principal of or interest or Liquidated Damages, if any, and the Redemption Price, Purchase Price and Designated Event Repurchase Price, if applicable, on such Notes, as the case may be, have become due and payable, shall be repaid to the Company by the Trustee on written demand; provided, however, that the Company, or the Trustee at the written request and expense of the Company, shall have first caused notice of such payment to the Company to be mailed to each Holder entitled thereto no less than 30 days prior to such payment and all liability of the Trustee shall thereupon cease with respect to such monies; and the Holder shall thereafter look only to the Company for any payment which such Holder may be entitled to collect unless an applicable abandoned property law designates another person.

SECTION 8.05 Reinstatement.

If the Trustee or the Paying Agent is unable to apply any money in accordance with Section 8.02 by reason of any order or judgment of any court or governmental authority enjoining, restraining or otherwise prohibiting such application, the Company’s obligations under this Indenture and the Notes shall be revived and reinstated as though no deposit had occurred pursuant to Section 8.01 until such time as the Trustee or the Paying Agent is permitted to apply all such money in accordance with Section 8.02; provided, however, that if the Company makes any payment of principal of, or interest or Liquidated Damages, if any, on, and the Redemption Price, Purchase Price and Designated Event Repurchase Price, if applicable, on any Note following the reinstatement of its obligations, the Company shall be subrogated to the rights of the Holders thereof to receive such payment from the money held by the Trustee or Paying Agent.

ARTICLE 9

AMENDMENTS

SECTION 9.01 Without the Consent of Holders.

The Company and the Trustee may amend or supplement this Indenture or the Notes without notice to or the consent of any Holder for the purposes of:

(a) curing any ambiguity, defect or inconsistency or making any other changes in the provisions of this Indenture which the Company and the Trustee may deem necessary or desirable, provided that such amendment does not materially and adversely affect the rights of the Holders under this Indenture;

(b) providing for the assumption of the covenants and obligations of the Company hereunder and in the Notes in the circumstances required by Section 5.01;

(c) providing for conversion rights of Holders in the event of consolidation, merger, or sale of all or substantially all of the assets of the Company as required to comply with Sections 5.01 and/or 11.06;

(d) reducing the Conversion Price;

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(e) evidencing and providing for the acceptance of appointment under this Indenture of a successor Trustee;

(f) making any change that would provide any additional rights or benefits to the Holders or that does not adversely affect the legal rights under this Indenture of any such Holder;

(g) complying with the requirements of the Commission in order to effect or maintain the qualification of the Indenture under the TIA; or

(h) modifying the restrictions on, and procedures for, resale and other transfers of the shares of Common Stock pursuant to law, regulation or practice relating to the resale or transfer of restricted securities generally.

SECTION 9.02 With the Consent of Holders.

Subject to Section 6.07, the Company and the Trustee may amend or supplement this Indenture or the Notes with the consent of the Holders of at least a majority in aggregate principal amount of the Notes then outstanding (including consents obtained in connection with a tender offer or exchange offer for the Notes).

Subject to Sections 6.04 and 6.07, the Company and the Trustee may waive any existing Default or compliance in any particular instance by the Company with any provision of this Indenture or the Notes with the consent of the Holders of at least a majority in principal amount of the Notes then outstanding (including consents obtained in connection with a tender offer or exchange offer for the Notes).

However, without the consent of each Holder affected, an amendment or waiver under this Section may not (with respect to any Notes held by a non-consenting Holder):

(a) reduce the principal amount of Notes whose Holders must consent to an amendment, supplement or waiver;

(b) reduce the principal of or change the fixed maturity of any Note or, except as permitted pursuant to Section 9.01, alter the redemption or repurchase provisions with respect thereto;

(c) reduce the rate of or amount of, or change the time for payment of, interest, including defaulted interest and Liquidated Damages, if any, and any Redemption Price, Purchase Price or Designated Event Repurchase Price, if applicable, on any Note;

(d) waive a Default or Event of Default in the payment of principal of or interest or Liquidated Damages, if any, on the Notes (except a rescission of acceleration of the Notes by the Holders of at least a majority in aggregate principal amount of the Notes then outstanding and a waiver of the payment default that resulted from such acceleration);

(e) make any Note payable in money other than as provided for herein and in the Notes;

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(f) make any change in the provisions of this Indenture relating to waivers of past Defaults or the rights of Holders to receive payments of principal of or interest or Liquidated Damages, if any, and any Redemption Price, Purchase Price or Designated Event Repurchase Price, if applicable, on the Notes;

(g) waive the payment of any Designated Event Repurchase Price with respect to any Note;

(h) increase the Conversion Price or, except as permitted herein (including Section 9.01), modify the provisions contained herein relating to conversion of the Notes in a manner adverse to the Holders thereof; or

(i) make any change to the abilities of Holders to enforce their rights hereunder or the provisions of clauses (a) through (i) of this Section 9.02.

To secure a consent of the Holders under this Section, it shall not be necessary for such Holders to approve the particular form of any proposed amendment or waiver, but it shall be sufficient if such consent approves the substance thereof.

After an amendment or waiver under this Section becomes effective, the Company shall mail to Holders a notice briefly describing the amendment or waiver.

SECTION 9.03 Compliance with the Trust Indenture Act.

Every amendment to this Indenture or the Notes shall be set forth in a supplemental indenture that complies with the TIA as then in effect.

SECTION 9.04 Revocation and Effect of Consents.

Until an amendment or waiver becomes effective, a consent to it by a Holder is a continuing consent by the Holder and every subsequent Holder of a Note or portion of a Note that evidences the same debt as the consenting Holder’s Note, even if notation of the consent is not made on any Note. However, any such Holder or subsequent Holder may revoke the consent as to his or her Note or portion of a Note if the Trustee receives the notice of revocation before the date on which the Trustee receives an Officers’ Certificate certifying that the Holders of the requisite principal amount of Notes have consented to the amendment or waiver.

The Company may, but shall not be obligated to, fix a record date for the purpose of determining the Holders entitled to consent to any amendment or waiver. If a record date is fixed, then notwithstanding the provisions of the immediately preceding paragraph, those persons who were Holders at such record date (or their duly designated proxies), and only those persons, shall be entitled to consent to such amendment or waiver or to revoke any consent previously given, whether or not such persons continue to be Holders after such record date. No consent shall be valid or effective for more than 90 days after such record date unless consents from Holders of the principal amount of Notes required hereunder for such amendment or waiver to be effective shall have also been given and not revoked within such 90-day period.

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After an amendment or waiver becomes effective it shall bind every Holder, unless it is of the type described in clauses (a) - (i) of Section 9.02. In such case, the amendment or waiver shall only bind each Holder who has consented to it and every subsequent Holder of a Note or portion of a Note that evidences the same debt as the consenting Holder’s Note.

SECTION 9.05 Notation on or Exchange of Convertible Senior Notes.

Notes authenticated and delivered after the execution of any supplemental indenture pursuant to this Article 9 may, and shall if required by the Trustee, bear a notation in the form approved by the Trustee as to any matter provided for in such supplemental indenture. If the Company shall so determine, new Notes so modified as to conform, in the opinion of the Company and the Trustee, to any such supplemental indenture may be prepared and executed by the Company and authenticated and delivered by the Trustee in exchange for outstanding Notes without charge to the Holders, except as specified in Section 2.07.

SECTION 9.06 Trustee Protected.

The Trustee shall sign any amendment or supplemental indenture authorized pursuant to this Article 9 if such amendment or supplemental indenture does not adversely affect the rights, duties, liabilities or immunities of the Trustee. If such amendment or supplemental indenture does adversely affect the rights, duties, liabilities or immunities of the Trustee, the Trustee may, but need not, sign it. In signing such amendment or supplemental indenture, the Trustee shall be entitled to receive, and shall be fully protected in relying upon, an Officers’ Certificate and an Opinion of Counsel as conclusive evidence that such amendment or supplemental indenture is authorized or permitted by this Indenture, that it is not inconsistent herewith, and that it will be valid and binding upon the Company in accordance with its terms.

ARTICLE 10

GENERAL PROVISIONS

SECTION 10.01 Trust Indenture Act Controls.

If any provision of this Indenture limits, qualifies or conflicts with the duties imposed by TIA § 318(c), such duties imposed by such section of the TIA shall control. If any provision of this Indenture expressly modifies or excludes any provision of the TIA that may be so modified or excluded, the Indenture provision so modifying or excluding such provision of the TIA shall be deemed to apply.

SECTION 10.02 Notices.

Any notice or communication by the Company or the Trustee to the other is duly given if in writing and delivered in person or mailed by first-class mail, with postage prepaid (registered or certified, return receipt requested), or sent by facsimile or overnight air couriers guaranteeing next day delivery, to the other’s address as stated in Section 10.10. The Company or the Trustee by notice to the other may designate additional or different addresses for subsequent notices or communications.

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All notices and communications (other than those sent to Holders) shall be deemed to have been duly given at the time delivered by hand, if personally delivered; five business days after being deposited in the mail, postage prepaid, if mailed; when transmission is confirmed, if transmitted by facsimile; and the next business day after timely delivery to the courier, if sent by overnight air courier guaranteeing next day delivery. Notwithstanding the foregoing, all notices to the Trustee shall be effective only upon receipt by a Trust Officer.

Any notice or communication to a Holder shall be mailed by first-class mail, with postage prepaid, to his or her address shown on the Register kept by the Registrar. Failure to mail a notice or communication to a Holder or any defect in it shall not affect its sufficiency with respect to other Holders.

If a notice or communication to a Holder is sent in the manner provided above within the time prescribed, it is duly given, whether or not the addressee receives it.

If the Company sends a notice or communication to Holders, it shall send a copy to the Trustee and each Agent at the same time.

All notices or communications shall be in writing.

SECTION 10.03 Communication by Holders with Other Holders.

Holders may communicate pursuant to TIA § 312(b) with other Holders with respect to their rights under this Indenture or the Notes. The Company, the Trustee, the Registrar and the paying agent shall have the protection of TIA § 312(c).

SECTION 10.04 Certificate and Opinion as to Conditions Precedent.

Upon any request or application by the Company to the Trustee to take any action under this Indenture, the Company shall furnish to the Trustee:

(a) an Officers’ Certificate in form and substance reasonably satisfactory to the Trustee (which shall include the statements set forth in Section 10.05) stating that, in the opinion of such person, all conditions precedent and covenants, if any, provided for in this Indenture relating to the proposed action have been complied with; and

(b) an Opinion of Counsel in form and substance reasonably satisfactory to the Trustee (which shall include the statements set forth in Section 10.05) stating that, in the opinion of such counsel, all such conditions precedent and covenants have been complied with.

SECTION 10.05 Statements Required in Certificate or Opinion.

Each certificate or opinion with respect to compliance with a condition or covenant provided for in this Indenture (other than a certificate provided pursuant to TIA § 314(a)(4)) shall include:

(a) a statement that the person making such certificate or opinion has read such covenant or condition;

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(b) a brief statement as to the nature and scope of the examination or investigation upon which the statements or opinions contained in such certificate or opinion are based;

(c) a statement that, in the opinion of such person, he or she has made such examination or investigation as is necessary to enable him or her to express an informed opinion as to whether or not such covenant or condition has been complied with; and

(d) a statement as to whether or not, in the opinion of such person, such condition or covenant has been complied with.

Any Officers’ Certificate may be based, insofar as it relates to legal matters, upon an Opinion of Counsel, unless such Officer knows that the opinion with respect to the matters upon which his or her certificate may be based as aforesaid is erroneous. Any Opinion of Counsel may be based, insofar as it relates to factual matters, upon certificates, statements or opinions of, or representations by an officer or officers of the Company, or other persons or firms deemed appropriate by such counsel, unless such counsel knows that the certificates, statements or opinions or representations with respect to the matters upon which his or her opinion may be based as aforesaid are erroneous.

Any Officers’ Certificate, statement or Opinion of Counsel may be based, insofar as it relates to accounting matters, upon a certificate or opinion of or representation by an accountant (who may be an employee of the Company), or firm of accountants, unless such Officer or counsel, as the case may be, knows that the certificate or opinion or representation with respect to the accounting matters upon which his or her certificate, statement or opinion may be based as aforesaid is erroneous.

SECTION 10.06 Rules by Trustee and Agents.

The Trustee may make reasonable rules for action by, or a meeting of, Holders. The Registrar or Paying Agent may make reasonable rules and set reasonable requirements for its functions.

SECTION 10.07 Legal Holidays.

The term “business day” means any day other than a Saturday, a Sunday or a day on which banking institutions in The City of New York are authorized or required by law, regulation or executive order to close. If any Interest Payment Date, the Maturity Date, Purchase Date or Designated Event Repurchase Date falls on a day that is not a business day, the required payment of principal of, interest and Liquidated Damages, if any, on and the Purchase Price and Designated Event Repurchase Price with respect to any Note will be made on the next succeeding business day as if made on the date that such payment was due and no interest will accrue on that payment for the period from and after the Interest Payment Date, the Maturity Date, the relevant Purchase Date or the Designated Event Repurchase Date, as applicable, to the date of payment on the next succeeding business day.

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SECTION 10.08 No Recourse Against Others.

No director, officer, employee, stockholder or Affiliate of the Company shall have any liability or any obligations under the Notes or this Indenture or for any claim based on, in respect of, or by reason of such obligations or the creation of such obligations. Each Holder by accepting a Note waives and releases all such liability with respect to each director, officer, employee, stockholder and Affiliate of the Company. This waiver and release are part of the consideration for the Notes. Each of such directors, officers, employees, stockholders and Affiliates of the Company is a third party beneficiary of this Section 10.08.

SECTION 10.09 Counterparts.

This Indenture may be executed in any number of counterparts and by the parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute one and the same agreement.

SECTION 10.10 Other Provisions.

The Company initially appoints the Trustee as Paying Agent, Registrar, Conversion Agent and authenticating agent. The reporting date for Section 7.06 is May 15 of each year. The first reporting date is the May 15 following the issuance of the Notes hereunder.

The Trustee shall always have, or shall be a subsidiary of a bank or bank holding company that has, a combined capital and surplus of at least $50,000,000 as set forth in its most recent published annual report of condition.

The Company’s address is:

Delta Air Lines, Inc.

1030 Delta Boulevard

Department 981

Atlanta, GA 30320-6001

Facsimile No.: (404) 715-2233

Attention: Dean C. Arvidson

The Trustee’s address is:

The Bank of New York Trust Company of Florida, N.A.

10161 Centurion Parkway

Jacksonville, FL 32256,

Attention: Corporate Trust Department

Facsimile: (904) 645-1921

SECTION 10.11 Governing Law.

The laws of the State of New York shall govern this Indenture and the Notes.

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SECTION 10.12 No Adverse Interpretation of Other Agreements.

This Indenture may not be used to interpret another indenture, loan or debt agreement of the Company or a subsidiary. Any such other indenture, loan or debt agreement may not be used to interpret this Indenture.

SECTION 10.13 Successors.

All agreements of the Company in this Indenture and the Notes shall bind its successor. All agreements of the Trustee in this Indenture shall bind its successor.

SECTION 10.14 Severability.

In case any provision in this Indenture or in the Notes shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.

SECTION 10.15 Table of Contents, Headings, etc.

The Table of Contents, Cross-Reference Table and headings of the Articles and Sections of this Indenture have been inserted for convenience of reference only, are not to be considered a part hereof and shall in no way modify or restrict any of the terms or provisions hereof.

ARTICLE 11

CONVERSION OF CONVERTIBLE SENIOR NOTES

SECTION 11.01 Right to Convert.

Each Holder shall have the right to convert its Notes into shares of Common Stock at any time during the period stated in Article 12 hereof and paragraph 9 of the Note, the form of which is attached hereto as Exhibit A. The principal amount of any Note held by such holder, or any portion of such principal amount which is $1,000 or an integral multiple thereof, may be converted into that number of fully paid and non-assessable shares of Common Stock obtained by dividing the principal amount of the Note or portion thereof to be converted by the Conversion Price in effect at such time, as set forth in paragraph 9 of the Note, subject to adjustment as herein set forth. A Holder is not entitled to any rights of a holder of Common Stock until such Holder has converted his or her Notes into Common Stock, and only to the extent such Notes are deemed to have been converted to Common Stock pursuant to this Article 11 and Article 12 hereof.

SECTION 11.02 Exercise of Conversion Privilege; Issuance of Common Stock on Conversion; No Adjustment for Interest or Dividends.

(a) To exercise, in whole or in part, the conversion privilege with respect to any Note, the Holder shall surrender such Note, duly endorsed, at an office or agency maintained by the Company pursuant to Section 2.03, accompanied by funds, if any, required by Section 11.02(e) hereof, and shall give written notice of conversion in the form provided on the Notes (or such

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other notice which is acceptable to the Company), duly signed and completed, to the office or agency stating that the Holder elects to convert such Note or such portion thereof specified in said notice. Such notice shall also state the name or names (with address or addresses) in which the certificate or certificates for shares of Common Stock which are issuable on such conversion shall be issued, and shall be accompanied by transfer taxes, if required pursuant to Section 11.07.

(b) Each Note surrendered for conversion shall, unless the shares issuable on conversion are to be issued in the same name as the registration of such Note, be duly endorsed by, or be accompanied by instruments of transfer in form satisfactory to the Company duly executed by, the Holder or his or her duly authorized attorney. The Holder will not be required to pay any tax or duty which may be payable in respect of the issue or delivery of Common Stock on conversion, but will be required to pay any tax or duty which may be payable in respect of any transfer involved in the issue or delivery of Common Stock in a name other than the same name as the registration of such Note.

(c) As promptly as practicable after satisfaction of the requirements for conversion set forth above, the Company shall issue and shall deliver to such Holder at the office or agency maintained by the Company for such purpose pursuant to Section 2.03, a certificate or certificates for the number of full shares of Common Stock issuable upon the conversion of such Note or portion thereof in accordance with the provisions of this Article 11 and a check or cash in respect of any fractional interest in respect of a share of Common Stock arising upon such conversion, as provided in Section 11.03 (which payment, if any, shall be paid no later than five business days after satisfaction of the requirements for conversion set forth above). Certificates representing shares of Common Stock will not be issued or delivered unless all taxes and duties, if any, payable by the Holder have been paid. In case any Note of a denomination of an integral multiple greater than $1,000 is surrendered for partial conversion, and subject to Section 2.02, the Company shall execute, and the Trustee shall authenticate and deliver to the Holder so surrendered, without charge to him or her, a new Note or Notes in authorized denominations in an aggregate principal amount equal to the unconverted portion of the surrendered Note.

(d) Each conversion shall be deemed to have been effected as to any such Note (or portion thereof) on the date on which the requirements set forth above in this Section 11.02 have been satisfied as to such Note (or portion thereof) (the “Conversion Date”), and the person in whose name any certificate or certificates for shares of Common Stock are issuable upon such conversion shall be deemed to have become on said date the holder of record of the shares represented thereby; provided, however, that any such surrender on any date when the Company’s stock transfer books are closed shall result in the person in whose name the certificates are to be issued becoming the record holder thereof for all purposes on the next succeeding day on which such stock transfer books are open, but such conversion shall be at the Conversion Price in effect on the date upon which such Note is surrendered.

(e) Any Note or portion thereof surrendered for conversion during the period from the close of business on any Regular Record Date immediately preceding any Interest Payment Date to the opening of business on such Interest Payment Date shall be accompanied by payment, in funds acceptable to the Company, of an amount equal to the interest and Liquidated Damages, if any, otherwise payable on such Interest Payment Date on the principal amount being converted; provided, however, that no such payment need be made if:

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(i) there exists at the time of conversion a default in the payment of principal of or interest or Liquidated Damages, if applicable, on the Notes (including any principal of or interest payable in connection with a repurchase pursuant to Section 4.08 or Section 4.09 and a redemption pursuant to Section 4.01); or

(ii) the Company shall have specified a Redemption Date that is after the Regular Record Date and prior to such Interest Payment Date.

An amount equal to such payment shall be paid by the Company on such Interest Payment Date to the Holder at the close of business on the Regular Record Date; provided, however, that if the Company defaults in the payment of interest or Liquidated Damages, if applicable, on such Interest Payment Date, such amount shall be paid to the person who made such required payment.

(f) Except as provided above in this Section 11.02, no adjustment shall be made for interest and Liquidated Damages, if any, accrued on any Note converted or for dividends on any shares issued upon the conversion of such Note as provided in this Article 11. Delivery by the Company to the Holder of the Note converted of the number of shares of Common Stock into which the Note is convertible, at the Conversion Price in effect at such time, shall satisfy the obligations of the Company to pay the principal amount of such Note being converted and the accrued but unpaid interest on such converted Note through the Conversion Date.

SECTION 11.03 Cash Payments in Lieu of Fractional Shares.

No fractional shares of Common Stock or scrip representing fractional shares shall be issued upon conversion of the Notes. If more than one Note shall be surrendered for conversion at one time by the same Holder, the number of full shares which shall be issuable upon conversion shall be computed on the basis of the aggregate principal amount of the Notes (or specified portions thereof to the extent permitted hereby) so surrendered for conversion. If any fractional share of stock otherwise would be issuable upon the conversion of any Note or Notes, the Company shall make an adjustment therefor in cash based upon the Current Market Price (as defined in Section 11.05(g)) of the Common Stock for the 5 consecutive trading days immediately preceding the Conversion Date.

SECTION 11.04 Conversion Price.

The Conversion Price shall be as specified in paragraph 9 of the Note, the form of which is attached as Exhibit A hereto, subject to adjustment as provided in this Article 11.

SECTION 11.05 Adjustment of Conversion Price.

The Conversion Price shall be adjusted from time to time by the Company as follows:

(a) If the Company shall hereafter pay a dividend or make a distribution to all holders of the outstanding Common Stock in shares of Common Stock, the Conversion Price in effect at the opening of business on the date following the date fixed for the determination of stockholders entitled to receive such dividend or other distribution shall be reduced by multiplying such Conversion Price by a fraction of which:

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(i) the numerator shall be the number of shares of Common Stock outstanding at the close of business on the Record Date (as defined in Section 11.05(g)) fixed for such determination; and

(ii) the denominator shall be the sum of (1) the number of shares of Common Stock outstanding at the close of business on the Record Date (as defined in Section 11.05(g)) fixed for such determination and (2) the total number of shares of Common Stock constituting such dividend or other distribution,

such reduction to become effective immediately after the opening of business on the day following the Record Date. If the dividend or distribution of the type described in this Section 11.05(a) is declared but not so paid or made, the Conversion Price shall again be adjusted to the Conversion Price which would then be in effect if such dividend or distribution had not been declared.

(b) If the outstanding shares of Common Stock shall be subdivided into a greater number of shares of Common Stock, the Conversion Price in effect at the opening of business on the day following the day upon which such subdivision becomes effective shall be proportionately reduced, and, conversely, if the outstanding shares of Common Stock shall be combined into a smaller number of shares of Common Stock, the Conversion Price in effect at the opening of business on the day following the day upon which such combination becomes effective shall be proportionately increased, such reduction or increase, as the case may be, to become effective immediately after the opening of business on the day following the day upon which such subdivision or combination becomes effective.

(c) If the Company shall issue rights or warrants to all holders of its outstanding shares of Common Stock entitling them to subscribe for or purchase, for a period expiring within 45 days after the date of issuance, shares of Common Stock at a price per share less than the Current Market Price (as defined in Section 11.05(g)) on the Record Date fixed for the determination of stockholders entitled to receive such rights or warrants, the Conversion Price shall be reduced so that the same shall equal the price determined by multiplying the Conversion Price in effect immediately prior to the close of business on such Record Date by a fraction of which:

(i) the numerator shall be the number of shares of Common Stock outstanding at the close of business on the Record Date plus the number of shares which the aggregate offering price of the total number of shares so offered would purchase at such Current Market Price; and

(ii) the denominator shall be the number of shares of Common Stock outstanding on the close of business on the Record Date plus the total number of additional shares of Common Stock so offered for subscription or purchase.

Such adjustment shall become effective immediately after the opening of business on the day following the Record Date fixed for determination of stockholders entitled to receive such rights or warrants. To the extent that shares of Common Stock are not delivered pursuant to such rights or warrants, upon the expiration or termination of such rights or warrants, the Conversion Price shall be readjusted to be the Conversion Price which would then be in effect had the adjustments

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made upon the issuance of such rights or warrants been made on the basis of delivery of only the number of shares of Common Stock actually delivered. If such rights or warrants are not so issued, the Conversion Price shall again be adjusted to be the Conversion Price which would then be in effect if such date fixed for the determination of stockholders entitled to receive such rights or warrants had not been fixed. In determining whether any rights or warrants entitle the Holders to subscribe for or purchase shares of Common Stock at less than such Current Market Price, and in determining the aggregate offering price of such shares of Common Stock, there shall be taken into account any consideration received by the Company for such rights or warrants, and any amount payable upon exercise thereof, with the value of such consideration, if other than cash, to be determined by the Board of Directors (whose determination shall be conclusive and described in a resolution of the Board of Directors).

(d) If the Company shall, by dividend or otherwise, distribute to all holders of its Common Stock shares of any class of Capital Stock of the Company (other than any dividends or distributions to which Section 11.05(a) applies) or evidences of its indebtedness or other assets (including securities, but excluding (i) any rights or warrants of a type referred to in Section 11.05(c) and (ii) dividends and distributions paid exclusively in cash referred to in Section 11.05(e)) (the foregoing hereinafter in this Section 11.05(d) called the “Securities”), then, in each such case, the Conversion Price shall be reduced so that the same shall be equal to the price determined by multiplying the Conversion Price in effect immediately prior to the close of business on such Record Date (as defined in Section 11.05(g)) with respect to such distribution by a fraction of which:

(i) the numerator shall be the Current Market Price (determined as provided in Section 11.05(g)) on such Record Date less the fair market value (as determined by the Board of Directors, whose determination shall be conclusive and described in a resolution of the Board of Directors), on such Record Date of the portion of the Securities so distributed applicable to one share of Common Stock; and

(ii) the denominator shall be such Current Market Price on such Record Date,

such reduction to become effective immediately after the opening of business on the day following the Record Date; provided, however, that in the event the then fair market value (as so determined) of the portion of the Securities so distributed applicable to one share of Common Stock is equal to or greater than the Current Market Price on the Record Date, in lieu of the foregoing adjustment, adequate provision shall be made so that each Holder shall have the right to receive upon conversion of a Note (or any portion thereof) the amount of Securities such Holder would have received had such Holder converted such Note (or portion thereof) immediately prior to such Record Date. If such dividend or distribution is not so paid or made, the Conversion Price shall again be adjusted to be the Conversion Price that would then be in effect if such dividend or distribution had not been declared. If the Board of Directors determines the fair market value of any distribution for purposes of this Section 11.05(d) by reference to the actual or when issued trading market for any securities comprising all or part of such distribution, it must in doing so consider the prices in such market over the same period used in computing the Current Market Price pursuant to Section 11.05(g) to the extent possible.

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Rights or warrants distributed by the Company to all holders of Common Stock entitling the holders thereof to subscribe for or purchase shares of the Company’s Capital Stock (either initially or under certain circumstances), which rights or warrants, until the occurrence of a specified event or events (“Trigger Event”):(i) are deemed to be transferred with such shares of Common Stock; (ii) are not exercisable; and (iii) are also issued in respect of future issuances of Common Stock, shall be deemed not to have been distributed for purposes of this Section 11.05(d) (and no adjustment to the Conversion Price under this Section 11.05(d) shall be required) until the occurrence of the earliest Trigger Event, whereupon such rights and warrants shall be deemed to have been distributed and an appropriate adjustment to the Conversion Price under this Section 11.05(d) shall be made. If any such rights or warrants, including any such existing rights or warrants distributed prior to the date of this Indenture, are subject to Trigger Events, then the occurrence of each such event shall be deemed to be such date of issuance and Record Date with respect to new rights or warrants (and a termination or expiration of the existing rights or warrants without exercise by the holder thereof). In addition, in the event of any distribution (or deemed distribution) of rights or warrants, or any Trigger Event with respect thereto, that was counted for purposes of calculating a distribution amount for which an adjustment to the Conversion Price under this Section 11.05(d) was made, (1) in the case of any such rights or warrants which shall all have been redeemed or repurchased without exercise by any holders thereof, the Conversion Price shall be readjusted upon such final redemption or repurchase to give effect to such distribution or Trigger Event, as the case may be, as though it were a cash distribution, equal to the per share redemption or repurchase price received by a holder or holders of Common Stock with respect to such rights or warrants (assuming such holder had retained such rights or warrants), made to all holders of Common Stock as of the date of such redemption or repurchase, and (2) in the case of such rights or warrants which shall have expired or been terminated without exercise by any holders thereof, the Conversion Price shall be readjusted as if such rights and warrants had not been issued.

Notwithstanding any other provision of this Section 11.05(d) to the contrary, rights, warrants, evidences of indebtedness, other securities, cash or other assets (including, without limitation, any rights distributed pursuant to any stockholders rights plan, and any rights or warrants distributed or deemed to be distributed upon the occurrence of a Trigger Event) shall be deemed not to have been distributed for purposes of this Section 11.05(d) if the Company elects to reserve such rights, warrants, evidences of indebtedness, other securities, cash or other assets (including, without limitation, any rights distributed pursuant to any stockholders rights plan, and any rights or warrants distributed or deemed to be distributed upon the occurrence of a Trigger Event) for distribution to each Holder who converts a Note (or any portion thereof) so that such Holder shall be entitled to receive upon such conversion, in addition to the shares of Common Stock issuable upon such conversion, the amount and kind of such distributions that such Holder would have been entitled to receive if such Holder had, immediately prior to the applicable Record Date, converted such Note into Common Stock.

For purposes of this Section 11.05(d) and Sections 11.05(a) and (c), any dividend or distribution to which this Section 11.05(d) is applicable that also includes shares of Common Stock, or rights or warrants to subscribe for or purchase shares of Common Stock to which Section 11.05(a) or Section 11.05(c) applies, or both, shall be deemed instead to be (1) a dividend or distribution of the evidences of indebtedness, assets, shares of Capital Stock, rights or warrants other than such shares of Common Stock or rights or warrants to which Section

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11.05(a) or Section 11.05(c) applies (and any Conversion Price reduction required by this Section 11.05(d) with respect to such dividend or distribution shall then be made) immediately followed by (2) a dividend or distribution of such shares of Common Stock or such rights or warrants to which Section 11.05(a) or Section 11.05(c) applies (and any further Conversion Price reduction required by Sections 11.05(a) and (c) with respect to such dividend or distribution shall then be made, except that (A) the Record Date of such dividend or distribution shall be substituted for “the date fixed for the determination of stockholders entitled to receive such dividend or other distribution,” “Record Date fixed for such determination” and “Record Date” within the meaning of Section 11.05(a) and for “the date fixed for the determination of stockholders entitled to receive such rights or warrants,” “the Record Date fixed for the determination of the stockholders entitled to receive such rights or warrants” and “such Record Date” within the meaning of Section 11.05(c) and (B) any shares of Common Stock included in such dividend or distribution shall not be deemed “outstanding at the close of business on the date fixed for such determination” within the meaning of Section 11.05(a)).

(e) If the Company shall, by dividend or otherwise, distribute cash to all holders of its Common Stock (excluding any cash that is distributed as part of a distribution referred to in Section 11.05(d) and excluding the Company’s regular quarterly cash dividends) in an aggregate amount that, combined together with (1) the aggregate amount of any other such all-cash distributions to all holders of its Common Stock within the 12 months preceding the date of payment of such distribution, and in respect of which no adjustment pursuant to this Section 11.05(e) has been made, and (2) the aggregate of any cash plus the fair market value (as determined by the Board of Directors, whose determination shall be conclusive and described in a resolution of the Board of Directors) of consideration payable in respect of any tender offer by the Company or any of its subsidiaries for all or any portion of the Common Stock concluded within the 12 months preceding the date of payment of such distribution, and in respect of which no adjustment pursuant to Section 11.05(f) has been made, exceeds 15% of the product of the Current Market Price (determined as provided in Section 11.05(g)) on the Record Date with respect to such distribution times the number of shares of Common Stock outstanding on such Record Date, then, and in each such case, the Conversion Price shall be reduced, so that the same shall equal the price determined by multiplying the Conversion Price in effect immediately prior to the close of business on such Record Date by a fraction:

(i) the numerator of which shall be equal to the Current Market Price on the Record Date less an amount equal to the quotient obtained by dividing (x) the excess of such combined amount over 15% of the product of the Current Market Price (determined as provided in Section 11.05(g)) on the Record Date with respect to such distribution times the number of shares of Common Stock outstanding on such Record Date, by (y) the product of the Current Market Price (determined as provided in Section 11.05(g)) on the Record Date with respect to such distribution times the number of shares of Common Stock outstanding on the Record Date; and

(ii) the denominator of which shall be equal to the Current Market Price on such Record Date,

such adjustment to be effective immediately after the opening of business on the day following the Record Date. If such dividend or distribution is not so paid or made, the Conversion Price

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shall again be adjusted to be the Conversion Price that would then be in effect if such dividend or distribution had not been declared.

(f) If a tender offer (other than the purchase of Notes on any Purchase Date or as part of a Designated Event) made by the Company or any of its subsidiaries for all or any portion of the Common Stock expires and such tender offer (as amended upon the expiration thereof) requires the payment to stockholders (based on the acceptance (up to any maximum specified in the terms of the tender offer) of Purchased Shares (as defined below)) of an aggregate consideration having a fair market value (as determined by the Board of Directors, whose determination shall be conclusive and described in a resolution of the Board of Directors) that, combined together with (1) the aggregate of the cash plus the fair market value (as determined by the Board of Directors, whose determination shall be conclusive and described in a resolution of the Board of Directors), as of the expiration of such tender offer, of consideration payable in respect of any other tender offers by the Company or any of its subsidiaries for all or any portion of the Common Stock expiring within the 12 months preceding the expiration of such tender offer and in respect of which no adjustment pursuant to this Section 11.05(f) has been made and (2) the aggregate amount of any all-cash distributions to all holders of the Common Stock within 12 months preceding the expiration of such tender offer and in respect of which no adjustment pursuant to Section 11.05(e) has been made, exceeds 15% of the product of the Current Market Price (determined as provided in Section 11.05(g)) as of the last time (the “Expiration Time”) tenders could have been made pursuant to such tender offer (as it may be amended) times the number of shares of Common Stock outstanding (including any tendered shares) on the Expiration Time, then, and in each such case, the Conversion Price shall be adjusted so that the same shall equal the price determined by multiplying the Conversion Price in effect immediately prior to close of business on the date of the Expiration Time by a fraction of which:

(i) the numerator shall be the number of shares of Common Stock outstanding (including any Purchased Shares) on the Expiration Time multiplied by the Current Market Price of the Common Stock as of the Expiration Time; and

(ii) the denominator shall be the sum of (x) the fair market value (determined as aforesaid) of the aggregate consideration payable to stockholders based on the acceptance (up to any maximum specified in the terms of the tender offer) of all shares validly tendered and not withdrawn as of the Expiration Time (the shares deemed so accepted, up to any such maximum, being referred to as the “Purchased Shares”) and (y) the product of the number of shares of Common Stock outstanding (less any Purchased Shares) as of the Expiration Time and the Current Market Price of the Common Stock as of the Expiration Time,

such adjustment to be effective immediately after the opening of business on the day following the date of the Expiration Time. If the Company is obligated to purchase shares pursuant to any such tender offer, but the Company is permanently prevented by applicable law from effecting any such purchases or all such purchases are rescinded, the Conversion Price shall again be adjusted to be the Conversion Price which would then be in effect if such tender offer had not been made. If the application of this Section 11.05(f) to any tender offer would result in an increase in the Conversion Price, no adjustment shall be made for such tender offer under this Section 11.05(f).

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(g) For purposes of this Section 11.05, the following terms shall have the meaning indicated:

(1) “Current Market Price” means the average of the daily closing prices per share of Common Stock for, unless otherwise specified herein, the 10 consecutive trading days immediately prior to the date in question; provided, however, that (1) if the “ex” date (as hereinafter defined) for any event (other than the issuance or distribution requiring such computation) that requires an adjustment to the Conversion Price pursuant to Sections 11.05(a), (b), (c), (d), (e) or (f) occurs during such 10 consecutive trading days, the closing price for each trading day prior to the “ex” date for such other event shall be adjusted by multiplying such closing price by the same fraction by which the Conversion Price is so required to be adjusted as a result of such other event, (2) if the “ex” date for any event (other than the issuance or distribution requiring such computation) that requires an adjustment to the Conversion Price pursuant to Section 11.05(a), (b), (c), (d), (e) or (f) occurs on or after the “ex” date for the issuance or distribution requiring such computation and prior to the day in question, the closing price for each trading day on and after the “ex” date for such other event shall be adjusted by multiplying such closing price by the reciprocal of the fraction by which the Conversion Price is so required to be adjusted as a result of such other event, and (3) if the “ex” date for the issuance or distribution requiring such computation is prior to the day in question, after taking into account any adjustment required pursuant to clause (1) or (2) of this proviso, the closing price for each trading day on or after such “ex” date shall be adjusted by adding thereto the amount of any cash and the fair market value (as determined by the Board of Directors in a manner consistent with any determination of such value for purposes of Section 11.05(d) or (f), whose determination shall be conclusive and described in a resolution of the Board of Directors) of the evidences of indebtedness, shares of Capital Stock or assets being distributed applicable to one share of Common Stock as of the close of business on the day before such “ex” date. For purposes of any computation under Section 11.05(f), the Current Market Price on any date shall be deemed to be the average of the daily closing prices per share of Common Stock for such day and the next two succeeding trading days; provided, however, that if the “ex” date for any event (other than the tender offer or exchange offer requiring such computation) that requires an adjustment to the Conversion Price pursuant to Section 11.05(a), (b), (c), (d), (e) or (f) occurs on or after the Expiration Time for the tender or exchange offer requiring such computation and prior to the day in question, the closing price for each trading day on and after the “ex” date for such other event shall be adjusted by multiplying such closing price by the reciprocal of the fraction by which the Conversion Price is so required to be adjusted as a result of such other event. For purposes of this paragraph, the term “ex” date, (1) when used with respect to any issuance or distribution, means the first date on which the Common Stock trades regular way on the relevant exchange or in the relevant market from which the closing price was obtained without the right to receive such issuance or distribution, (2) when used with respect to any subdivision or combination of shares of Common Stock, means the first date on which the Common Stock trades regular way on such exchange or in such market after the time at which such subdivision or combination becomes effective, and (3) when used with respect to any tender or exchange offer means the first date on which the Common Stock trades regular way on such exchange or in such market after the Expiration Time of such offer. Notwithstanding the foregoing, whenever successive adjustments to the Conversion Price are called for pursuant to this Section 11.05, such adjustments shall be made to the Current Market Price as may be

56

necessary or appropriate to effectuate the intent of this Section 11.05 and to avoid unjust or inequitable results as determined in good faith by the Board of Directors.

(2) “closing price” with respect to any securities on any day means the closing sale price per share (or, if no closing sale price is reported, the average of the bid and asked prices or, if more than one in either case, the average of the average bid and the average asked prices) on such day as reported in composite transactions for the principal U.S. securities exchange on which such security is traded or, if such security is not listed on a U.S. national or regional securities exchange, as reported by the Nasdaq National Market. If such security is not listed for trading on a U.S. national or regional securities exchange and not reported by the Nasdaq National Market on the relevant date, the “closing price” shall be the last quoted bid price for such security in the over-the-counter market on the relevant date as reported by the National Quotation Bureau or similar organization. If such security is not so quoted, the “closing price” shall be the average of the mid-point of the last bid and asked prices for such security on the relevant date from each of at least three nationally recognized independent investment banking firms selected by the Company for such purpose.

(3) “fair market value” shall mean the amount which a willing buyer would pay a willing seller in an arm’s length transaction.

(4) “Record Date” shall mean, with respect to any dividend, distribution or other transaction or event in which the holders of Common Stock have the right to receive any cash, securities or other property or in which the Common Stock (or other applicable security) is exchanged for or converted into any combination of cash, securities or other property, the date fixed for determination of stockholders entitled to receive such cash, securities or other property (whether such date is fixed by the Board of Directors or by statute, contract or otherwise).

(5) “trading day” shall mean (x) if the applicable security is listed or admitted for trading on the New York Stock Exchange or another U.S. national or regional securities exchange, a day on which the New York Stock Exchange or such other U.S. national or regional securities exchange is open for business or (y) if the applicable security is quoted on the Nasdaq National Market, a day on which trades may be made thereon, or (z) if the applicable security is not so listed, admitted for trading or quoted, any business day (as defined herein).

(h) The Company may make such reductions in the Conversion Price, in addition to those required by Sections 11.05(a), (b), (c), (d), (e) or (f), as the Board of Directors considers to be advisable to avoid or diminish any potential income tax liability to holders of Common Stock or rights to purchase Common Stock which may result from any dividend or distribution of stock (or rights to acquire stock) or from any event treated as such for income tax purposes.

The Company from time to time may, to the extent permitted by law, reduce the Conversion Price by any amount for any period of at least 20 days, if the Board of Directors has made a determination that such reduction would be in the Company’s best interests, which determination shall be conclusive and described in a resolution of the Board of Directors. The reduction in Conversion Price shall be irrevocable during this period. Whenever the Conversion Price is reduced pursuant to the preceding sentence, the Company shall mail to the Holders at his or her last address appearing on the Register maintained for that purpose a notice of the reduction

57

at least 15 days prior to the date the reduced Conversion Price takes effect, and such notice shall state the reduced Conversion Price and the period during which it will be in effect.

(i) No adjustment in the Conversion Price shall be required unless such adjustment would require an increase or decrease of at least 1% in the Conversion Price then in effect; provided, however, that any adjustments which by reason of this Section 11.05(j) are not required to be made shall be carried forward and taken into account in any subsequent adjustment. All calculations under this Article 11 shall be made by the Company and shall be made to the nearest cent or to the nearest one hundredth of a share, as the case may be.

No adjustment need be made for a change in the par value or no par value of the Common Stock.

(j) Whenever the Conversion Price is adjusted as herein provided, the Company shall promptly file with the Trustee and any Conversion Agent other than the Trustee an Officers’ Certificate setting forth the Conversion Price after such adjustment and setting forth a brief statement of the facts requiring such adjustment. Promptly after delivery of such certificate, the Company shall prepare a notice of such adjustment of the Conversion Price setting forth the adjusted Conversion Price and the date on which each adjustment becomes effective and shall mail such notice of such adjustment of the Conversion Price to each Holder at his or her last address appearing on the Register maintained for that purpose within 20 days of the effective date of such adjustment. Failure to deliver such notice shall not affect the legality or validity of any such adjustment.

(k) In any case in which this Section 11.05 provides that an adjustment shall become effective immediately after a Record Date for an event, the Company may defer until the occurrence of such event issuing to the Holder of any Note converted after such Record Date and before the occurrence of such event the additional shares of Common Stock issuable upon such conversion by reason of the adjustment required by such event over and above the Common Stock issuable upon such conversion before giving effect to such adjustment.

(l) For purposes of this Section 11.05, the number of shares of Common Stock at any time outstanding shall not include shares held in the treasury of the Company but shall include shares issuable in respect of scrip certificates issued in lieu of fractions of shares of Common Stock. The Company shall not pay any dividend or make any distribution on shares of Common Stock held in the treasury of the Company.

SECTION 11.06 Effect of Reclassification, Consolidation, Merger or Sale.

If any of the following events occur:(i) any reclassification or change of the outstanding shares of Common Stock (other than a change in par value, or from par value to no par value, or from no par value to par value, or as a result of a subdivision or combination), (ii) any consolidation, merger, share exchange or combination of the Company with another corporation as a result of which holders of Common Stock shall be entitled to receive stock, securities or other property or assets (including cash) with respect to or in exchange for such Common Stock, other than a consolidation, merger, share exchange or combination in which the Company is the continuing corporation and which does not result in reclassification (other than a change in

58

name, or par value, or from par value to no par value, or from no par value to par value or as a result of a subdivision or combination), conversion, exchange or cancellation of the Common Stock, or (iii) any sale or conveyance or other disposition of the properties and assets of the Company as an entirety or substantially as an entirety to any other corporation as a result of which holders of Common Stock shall be entitled to receive stock, securities or other property or assets (including cash) with respect to or in exchange for such Common Stock, then the Company or the successor or purchasing corporation, as the case may be, shall execute with the Trustee a supplemental indenture (which shall comply with the TIA as in force at the date of execution of such supplemental indenture if such supplemental indenture is then required to so comply) providing that the Notes shall be convertible into the kind and amount of shares of stock and other securities or property or assets (including cash) receivable upon such reclassification, change, consolidation, merger, share exchange, combination, sale, conveyance or other disposition by a holder of a number of shares of Common Stock issuable upon conversion of the Notes (assuming, for such purposes, a sufficient number of authorized shares of Common Stock available to convert all such Notes) immediately prior to such reclassification, change, consolidation, merger, share exchange, combination, sale, conveyance or other disposition assuming such holder of Common Stock did not exercise his or her rights of election, if any, as to the kind or amount of securities, cash or other property receivable upon such reclassification, change, consolidation, merger, share exchange, sale, conveyance or other disposition (provided that, if the kind or amount of securities, cash or other property receivable upon such reclassification, change, consolidation, merger, share exchange, sale, conveyance or other disposition is not the same for each share of Common Stock in respect of which such rights of election have not been exercised (“non-electing share”), then, for the purposes of this Section 11.06, the kind and amount of securities, cash or other property receivable upon such reclassification, change, consolidation, merger, share exchange, sale, conveyance or other disposition for each non-electing share shall be deemed to be the kind and amount so receivable per share by a plurality of the non-electing shares). Such supplemental indenture shall provide for adjustments that shall be as nearly equivalent as may be practicable to the adjustments provided for in this Article 11. If, in the case of any such reclassification, change, consolidation, merger, share exchange, combination, sale, conveyance or other disposition, the stock or other securities and assets receivable thereupon by a holder of shares of Common Stock includes shares of stock or other securities and assets of a corporation other than the successor or purchasing corporation, as the case may be, in such reclassification, change, consolidation, merger, share exchange, combination, sale, conveyance or other disposition, then such supplemental indenture shall also be executed by such other corporation and shall contain such additional provisions to protect the interests of the Holders as the Board of Directors shall reasonably consider necessary by reason of the foregoing.

The Company shall cause notice of the execution of such supplemental indenture to be mailed to each Holder at his or her address appearing on the Register for that purpose within 20 days after execution thereof. Failure to deliver such notice shall not affect the legality or validity of such supplemental indenture.

The above provisions of this Section 11.06 shall similarly apply to successive reclassifications, changes, consolidations, mergers, share exchanges, combinations, sales, conveyances and other dispositions.

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If this Section 11.06 applies to any event or occurrence, Section 11.05 shall not apply.

SECTION 11.07 Taxes on Shares Issued.

The issue of stock certificates on conversions of the Notes shall be made without charge to the converting Holder for any tax in respect of the issue thereof. The Company shall not, however, be required to pay any tax which may be payable in respect of any transfer involved in the issue and delivery of stock in any name other than that of the Holder of any Note converted, and the Company shall not be required to issue or deliver any such stock certificate unless and until the person or persons requesting the issue thereof shall have paid to the Company the amount of such tax or shall have established to the satisfaction of the Company that such tax has been paid.

SECTION 11.08 Reservation of Shares; Shares to Be Fully Paid; Listing of Common Stock.

(a) The Company shall provide, free from preemptive rights, out of its authorized but unissued shares or shares held in treasury, sufficient shares to provide for the conversion of the Notes from time to time as such Notes are presented for conversion.

(b) Before taking any action which would cause an adjustment reducing the Conversion Price below the then par value, if any, of the shares of Common Stock issuable upon conversion of the Notes, the Company shall take all corporate action which may, in the opinion of its counsel, be necessary in order that the Company may validly and legally issue shares of such Common Stock at such adjusted Conversion Price.

(c) The Company covenants that all shares of Common Stock issued upon conversion of the Notes will be duly authorized and validly issued and fully paid and non-assessable by the Company and free from all taxes, liens and charges with respect to the issue thereof.

(d) The Company further covenants that as long as the Common Stock is listed on the New York Stock Exchange, the Company shall cause all Common Stock issuable upon conversion of the Notes to be eligible for such listing in accordance with, and at the times required under, the requirements of the New York Stock Exchange, and if at any time the Common Stock becomes listed on any other U.S. national securities exchange, or quoted on the Nasdaq National Market System or any other automated quotation system, the Company shall cause all Common Stock issuable upon conversion of the Notes to be so listed or quoted and kept so listed or quoted.

SECTION 11.09 Responsibility of Trustee.

The Trustee shall not at any time be under any duty or responsibility to any Holders to determine whether any facts exist which may require any adjustment of the Conversion Price, or with respect to the nature or extent or calculation of any such adjustment when made, or with respect to the method employed, or herein or in any supplemental indenture provided to be employed, in making the same. The Trustee shall not be accountable with respect to the validity or value (or the kind or amount) of any shares of Common Stock, or of any securities or property, which may at any time be issued or delivered upon the conversion of any Note; and the Trustee makes no representations with respect thereto. Subject to the provisions of Section 7.01,

60

the Trustee shall not be responsible for any failure of the Company to issue, transfer or deliver any shares of Common Stock or stock certificates or other securities or property or cash upon the surrender of any Note for the purpose of conversion or to comply with any of the duties, responsibilities or covenants of the Company contained in this Article 11. Without limiting the generality of the foregoing, the Trustee shall not have any responsibility to determine the correctness of any provisions contained in any supplemental indenture entered into pursuant to Section 11.06 relating either to the kind or amount of shares of stock or securities or property (including cash) receivable by Holders upon the conversion of their Notes after any event referred to in such Section 11.06 or to any adjustment to be made with respect thereto, but, subject to the provisions of Section 7.01, may accept as conclusive evidence of the correctness of any such provisions, and shall fully be protected in relying upon, the Officers’ Certificate and Opinion of Counsel (which the Company shall be obligated to file with the Trustee prior to the execution of any such supplemental indenture) with respect thereto.

SECTION 11.10 Notice to Holders Prior to Certain Actions.

If (a) the Company declares a dividend (or any other distribution) on its Common Stock (other than in cash out of retained earnings); or

(b) the Company authorizes the granting to the holders of its Common Stock of rights or warrants to subscribe for or purchase any share of any class of Common Stock or any other rights or warrants (other than rights or warrants referred to in the second paragraph of Section 11.05(d)); or

(c) there is any reclassification of the Common Stock (other than a subdivision or combination of outstanding Common Stock, or a change in par value, or from par value to no par value, or from no par value to par value), or of any consolidation, merger or share exchange to which the Company is a party and for which approval of any stockholders of the Company is required, or of the sale or transfer or other disposition of all or substantially all of the assets of the Company; or

(d) there is any voluntary or involuntary dissolution, liquidation or winding-up of the Company;

then the Company shall cause to be filed with the Trustee and to be mailed to each Holder at his or her address appearing on the Register maintained for that purpose as promptly as possible but in any event at least 15 days prior to the applicable date hereinafter specified, a notice stating (x) the date on which a record is to be taken for the purpose of such dividend, distribution or rights or warrants, or, if a record is not to be taken, the date as of which the holders of Common Stock of record to be entitled to such dividend, distribution or rights or warrants are to be determined, or (y) the date on which such reclassification, consolidation, merger, share exchange, sale, transfer, dissolution, liquidation or winding-up is expected to become effective or occur, and the date as of which it is expected that holders of Common Stock of record shall be entitled to exchange their Common Stock for securities or other property deliverable upon such reclassification, consolidation, merger, share exchange, sale, transfer, dissolution, liquidation or winding-up. Failure to give such notice, or any defect therein, shall not affect the legality or

61

validity of such dividend, distribution, reclassification, consolidation, merger, share exchange, sale, transfer, dissolution, liquidation or winding-up.

SECTION 11.11 Restriction on Common Stock Issuable Upon Conversion.

(a) Shares of Common Stock to be issued upon conversion of Notes prior to the effectiveness of a Shelf Registration Statement shall be physically delivered in certificated form to the Holders converting such Notes, and the certificate representing such shares of Common Stock shall bear the Restricted Common Stock Legend unless removed in accordance with Section 11.11(c).

(b) If (i) shares of Common Stock to be issued upon conversion of a Note prior to the effectiveness of a Shelf Registration Statement are to be registered in a name other than that of the Holder of such Note or (ii) shares of Common Stock represented by a certificate bearing the Restricted Common Stock Legend are transferred subsequently by such Holder, then, unless the Shelf Registration Statement has become effective and such shares are being transferred pursuant to the Shelf Registration Statement, the Holder must deliver to the transfer agent for the Common Stock a certificate in substantially the form of Exhibit C as to compliance with the restrictions on transfer applicable to such shares of Common Stock, and neither the transfer agent nor the registrar for the Common Stock shall be required to register any transfer of such Common Stock not so accompanied by a properly completed certificate.

(c) Except in connection with a Shelf Registration Statement, if certificates representing shares of Common Stock are issued upon the registration of transfer, exchange or replacement of any other certificate representing shares of Common Stock bearing the Restricted Common Stock Legend, or if a request is made to remove such Restricted Common Stock Legend from certificates representing shares of Common Stock, the certificates so issued shall bear the Restricted Common Stock Legend, or the Restricted Common Stock Legend shall not be removed, as the case may be, unless there is delivered to the Company such satisfactory evidence, which, in the case of a transfer made pursuant to Rule 144 under the Securities Act, may include an opinion of counsel as may be reasonably required by the Company, that neither the legend nor the restrictions on transfer set forth therein are required to ensure that transfers thereof comply with the provisions of Rule 144A, Rule 144 or Regulation S under the Securities Act or that such shares of Common Stock are securities that are not “restricted” within the meaning of Rule 144 under the Securities Act. Upon provision to the Company of such reasonably satisfactory evidence, the Company shall cause the transfer agent for the Common Stock to countersign and deliver certificates representing shares of Common Stock that do not bear the legend.

ARTICLE 12

CONVERSION EVENTS

SECTION 12.01 Conversion Upon Satisfaction of Sale Price Condition.

(a) Subject to the provisions of this Article 12 and paragraph 9 of the Note, and subject to and upon compliance with the provisions of this Indenture, and notwithstanding the fact that any other condition to conversion has not been satisfied, the Holder of this Note has the

62

right to convert this Note into shares of Common Stock in any calendar quarter after the quarter ending June 30, 2003 if the last reported sale price of the Common Stock for at least 20 trading days during the period of 30 consecutive trading days ending on the last trading day of the immediately preceding calendar quarter is greater than or equal to 130% of the Conversion Price on such last trading day.

(b) The “last reported sale price” of the Common Stock on any date means the closing price for such Common Stock, as set forth in Section 11.05 above. The Company shall notify the Holders upon determination that Holders are or will be entitled to convert their Notes, or any portion of such principal amount which is $1,000 or an integral multiple thereof, into fully paid and non-assessable shares of Common Stock in accordance with this Article 12 and paragraph 9 of the Note, by issuing a press release and publishing such determination on the Company’s web site.

SECTION 12.02 Conversion Based on Trading Price of the Notes.

(a) Subject to the provisions of this Article 12 and paragraph 9 of the Note, and subject to and upon compliance with the provisions of this Indenture, and notwithstanding the fact that any other condition to conversion has not been satisfied, the Holder of this Note has the right to convert this Note into shares of Common Stock during the five business day period following any 10 consecutive trading days in which the average of the trading prices for the Notes for that 10 trading days was less than 98% of the average closing price (as defined in Section 11.05(g)) of the Common Stock during such period multiplied by the Conversion Rate. The “Conversion Rate” shall be equal to the number of shares of Common Stock issuable upon conversion of a Note per $1,000 of principal amount thereof (i.e., $1,000 principal amount of the Note being converted divided by the applicable Conversion Price).

(b) The “trading price” of the Notes on any date of determination means the average of the secondary market bid quotations per Note obtained by the Trustee for $10,000,000 principal amount of the Notes at approximately 3:30 p.m., New York City time, on such determination date from three independent nationally recognized securities dealers selected by the Company; provided that if at least three such bids cannot be obtained, but two such bids are obtained by the Trustee, then the average of the two bids shall be used. If the Trustee cannot reasonably obtain at least two bids for $10,000,000 principal amount of the Notes from a nationally recognized securities dealer or, in the reasonable judgment of the Company, the bid quotations are not indicative of the secondary market value of the Notes, then the trading price of the Notes will be deemed to be equal to 97.9% of (a) the Conversion Rate of the Notes as of the applicable date of determination multiplied by (b) the closing price (as set forth in Section 11.05) of the Common Stock on such determination date.

(c) The Trustee will determine the trading price of the Notes during the applicable period at the request of the Company. The Company shall make such request upon receipt of reasonable evidence from the Holder that the trading price of the Notes may be less than 98% of the average closing price (as set forth in Section 11.05) of the Common Stock multiplied by the Conversion Rate during the applicable period.

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SECTION 12.03 Conversion Upon Notice of Redemption.

Subject to the provisions of this Article 12 and paragraph 9 of the Note, and subject to and upon compliance with the provisions of this Indenture, and notwithstanding the fact that any other condition to conversion has not been satisfied, the Holder of this Note has the right to convert into shares of Common Stock the Notes or a portion thereof which has been called for redemption pursuant to Article 4 above; provided that such Note or a portion thereof is surrendered for conversion on or prior to the close of business on the Redemption Date in accordance with the terms of this Indenture.

SECTION 12.04 Conversion Upon Specified Corporate Transactions.

(a) Subject to the provisions of this Article 12 and paragraph 9 of the Note, and subject to and upon compliance with the provisions of this Indenture, and notwithstanding the fact that any other condition to conversion has not been satisfied, the Holder of this Note has the right to convert this Note into shares of Common Stock in the event that the Company (i) issues rights or warrants to all holders of its outstanding shares of Common Stock entitling them to subscribe for or purchase, for a period expiring within 45 days after the date of issuance, shares of Common Stock at a price per share less than the last reported sale price (as defined above) per share of Common Stock on the trading day (as defined in Section 11.05(g)) immediately preceding the date of the issuance; or (ii) distributes to all holders of its outstanding shares of Common Stock any assets or debt securities of the Company, or rights to purchase any securities of the Company, which distribution has a per share value, as determined by the Board of Directors (whose determination shall be conclusive and described in a resolution of the Board of Directors), that exceeds 15% of the last reported sale price (as defined above) per share of Common Stock on the trading day (as defined in Section 11.05(g)) immediately preceding the date of declaration of such distribution. The Company will be required to give notice to the Holders at least 20 business days prior to the ex-dividend date for such distribution, and Notes may be surrendered for conversion at any time thereafter until the earlier of the close of business on the business day immediately prior to the ex-dividend date and the announcement by the Company that such distribution will not take place, even if the Notes are not otherwise convertible at such time. The “ex-dividend date” shall mean the first date upon which the sale of the Common Stock does not automatically transfer the right to receive the relevant distribution from the seller of the Common Stock to its buyer.

(b) Subject to the provisions of this Article 12 and paragraph 9 of the Note, and subject to and upon compliance with the provisions of this Indenture, and notwithstanding the fact that any other condition to conversion has not been satisfied, the Holder of this Note has the right to convert this Note into shares of Common Stock in the event the Company is a party to any consolidation, merger, share exchange or combination pursuant to which the Common Stock would be converted into cash, securities or other property as set forth in Section 11.06, the Notes may be surrendered for conversion at any time from and after the date which is 15 days prior to the anticipated effective date of the transaction until 15 days after the actual effective date of such transaction and, at the effective time of such transaction, the right to convert a Note into Common Stock will be deemed to have changed into a right to convert such Note into the kind and amount of cash, securities or other property of the Company or another person which the

64

Holder would have received if the Holder had converted its Notes immediately prior to the applicable record date for such transaction.

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(c) IN WITNESS WHEREOF, the parties have caused this Indenture to be duly executed, all as of the date first above written, signifying their agreements contained in this Indenture.

DELTA AIR LINES, INC.
By:	/s/ M. Michele Burns
	Name:	M. Michele Burns
	Title:	Executive Vice President and Chief Financial Officer
THE BANK OF NEW YORK TRUST COMPANY OF FLORIDA, N.A.
not in its individual capacity but solely as Trustee
By:	/s/ Derek Kettel
	Name:	Derek Kettel
	Title:	Vice President

66

EXHIBIT A

(Face of Security)

[Global Securities Legend]

[The following legend shall appear on the face of each Global Security:

THIS CONVERTIBLE SENIOR NOTE IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF THE DEPOSITARY OR A NOMINEE OF THE DEPOSITARY, WHICH MAY BE TREATED BY THE COMPANY, THE TRUSTEE AND ANY AGENT THEREOF AS OWNER AND HOLDER OF THIS CONVERTIBLE SENIOR NOTE FOR ALL PURPOSES.]

[The following legend shall appear on the face of each Global Security for which The Depository Trust Company is to be the Depositary:

UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY THE AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR REGISTERED CONVERTIBLE SENIOR NOTES IN DEFINITIVE REGISTERED FORM IN THE LIMITED CIRCUMSTANCES REFERRED TO IN THE INDENTURE, THIS GLOBAL SECURITY MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR NOMINEE.]

A-1

[Restricted Securities Legend]

THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR ANY STATE SECURITIES LAWS. THE HOLDER HEREOF, BY PURCHASING THIS SECURITY, AGREES FOR THE BENEFIT OF DELTA AIR LINES, INC. THAT THIS SECURITY MAY NOT BE OFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED PRIOR TO THE LATER OF (X) THE EXPIRATION OF THE HOLDING PERIOD APPLICABLE TO THE SALES OF THE SECURITY EVIDENCED HEREBY UNDER RULE 144(k) UNDER THE SECURITIES ACT (OR ANY SUCCESSOR PROVISION) OR (Y) THREE MONTHS AFTER SUCH HOLDER CEASES TO BE AN “AFFILIATE” (WITHIN THE MEANING OF RULE 144 UNDER THE SECURITIES ACT) OF DELTA AIR LINES, INC., OTHER THAN (1) TO DELTA AIR LINES, INC., (2) SO LONG AS THIS SECURITY IS ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES ACT (“RULE 144A”), TO A PERSON WHO THE SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A, PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (3) IN AN OFFSHORE TRANSACTION (AS DEFINED IN REGULATION S UNDER THE SECURITIES ACT) IN ACCORDANCE WITH REGULATION S UNDER THE SECURITIES ACT, (4) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE 144 (IF AVAILABLE) UNDER THE SECURITIES ACT OR (5) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, IN EACH CASE IN ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES AND OTHER JURISDICTIONS. THE HOLDER HEREOF, BY PURCHASING THIS SECURITY, REPRESENTS AND AGREES FOR THE BENEFIT OF DELTA AIR LINES, INC. THAT IT IS (1) A QUALIFIED INSTITUTIONAL BUYER OR (2) NOT A U.S. PERSON AND IS OUTSIDE THE UNITED STATES WITHIN THE MEANING OF (OR AN ACCOUNT SATISFYING THE REQUIREMENTS OF PARAGRAPH (k)(2) OF RULE 902 UNDER) REGULATION S UNDER THE SECURITIES ACT. IN ANY CASE THE HOLDER HEREOF WILL NOT, DIRECTLY OR INDIRECTLY, ENGAGE IN ANY HEDGING TRANSACTION WITH REGARD TO THIS SECURITY OR ANY COMMON STOCK ISSUABLE UPON CONVERSION OF THIS SECURITY EXCEPT AS PERMITTED BY THE SECURITIES ACT.

A-2

CUSIP No.:
ISIN:
Common Code:	$

DELTA AIR LINES, INC.

8.00% CONVERTIBLE SENIOR NOTE DUE 2023

DELTA AIR LINES, INC. promises to pay to CEDE & CO. or registered assigns, the principal sum of                                     ($                             ) on June 3, 2023, and to pay interest thereon, as provided on the reverse hereof, until the principal and any unpaid and accrued interest is paid or duly provided for.

Interest Payment Dates: June 3 and December 3, commencing December 3, 2003

Regular Record Dates: May 19 and November 19

The provisions on the back of this certificate are incorporated as if set forth on the face hereof.

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IN WITNESS WHEREOF, the Company has caused this Note to be duly executed.

DELTA AIR LINES, INC.
By:
	Name:
	Title:

Certificate of Authentication

This is one of the Convertible Senior Notes described in the within-mentioned Indenture.

THE BANK OF NEW YORK

TRUST COMPANY OF FLORIDA, N.A.

as Trustee

By:
	Authorized Signatory
Dated:

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(Back of Security)

DELTA AIR LINES, INC.  

8.00% CONVERTIBLE SENIOR NOTES DUE 2023

1. INTEREST. Delta Air Lines, Inc., a Delaware corporation (the “Company”), promises to pay interest on the principal amount of this Note at the rate per annum shown above. The Company will pay interest (and Liquidated Damages, if any) semiannually in arrears on June 3 and December 3 of each year, beginning December 3, 2003. Interest on the Notes will accrue from the most recent Interest Payment Date to which interest has been paid or, if no interest has been paid, from June 2, 2003. Interest (and any Liquidated Damages) will be computed on the basis of a 360-day year composed of twelve 30-day months.

2. METHOD OF PAYMENT. The Company will pay interest (and Liquidated Damages, if any) on the Notes (except defaulted interest) to the person in whose name each Note is registered at the close of business on the May 19 or November 19 (each, a “Regular Record Date”) immediately preceding the relevant Interest Payment Date (other than with respect to a Note or portion thereof (i) with respect to which a notice of redemption shall have been mailed by the Company in accordance with Section 4.03 of the Indenture, which notice of redemption shall specify a Redemption Date that is after the close of business on a Regular Record Date and prior to the next Interest Payment Date, or (ii) repurchased in connection with a Designated Event on a Designated Event Repurchase Date that is after the close of business on a Regular Record Date and prior to the next Interest Payment Date, in which case accrued interest (and Liquidated Damages, if any) shall be payable (unless such Note or portion thereof is converted) to the Holder of the Note or portion thereof redeemed or repurchased in accordance with the applicable provisions of the Indenture).

The Holder must surrender Notes to a Paying Agent to collect principal payments. The Company will pay the principal and interest (including Liquidated Damages, if any, and Redemption Price, Purchase Price and Designated Event Repurchase Price, as applicable) on the Notes at the office or agency of the Company maintained for such purpose, in money of the United States that at the time of payment is legal tender for payment of public and private debts. Until otherwise designated by the Company, the Company’s office or agency maintained for such purpose will be the principal Corporate Trust Office of the Trustee. If the Notes are held in global form, principal and interest (including Liquidated Damages, if any, Redemption Price, Purchase Price and Designated Event Repurchase Price, as applicable) on the Notes shall be paid by wire transfer in immediately available funds in accordance with the written wire transfer instruction supplied by such Holder from time to time to the Trustee and Paying Agent (if different from the Trustee) at least two days prior to the applicable Regular Record Date; provided that any payment to the Depositary or its nominee shall be paid by wire transfer in immediately available funds in accordance with the wire transfer instruction supplied by the Depositary or its nominee from time to time to the Trustee and Paying Agent (if different from Trustee) at least two days prior to the applicable Regular Record Date. With respect to Notes held other than in global form, the Company will make payments by wire transfer of immediately available funds to the account specified by the Holders thereof or, if no such account is specified with respect to a Holder, by mailing a check to the Holder’s registered address.

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3. PAYING AGENT, REGISTRAR AND CONVERSION AGENT. The Bank of New York Trust Company of Florida, N.A . (together with any successor Trustee under the Indenture referred to below, the “Trustee”) will act as Paying Agent, Registrar and Conversion Agent. The Company may change any Paying Agent, Registrar, Conversion Agent or co-registrar without prior notice. Subject to certain limitations in the Indenture, the Company or any of its subsidiaries may act in any such capacity.

4. INDENTURE. The Company issued the Notes under an Indenture, dated as of June 2, 2003 (the “Indenture”), between the Company and the Trustee. The terms of the Notes include those stated in the Indenture and those made part of the Indenture by reference to the Trust Indenture Act of 1939 (15 U.S. Code §§77aaa-77bbbb) (the “TIA”) as in effect on the date of the Indenture. The Notes are subject to, and qualified by, all such terms, certain of which are summarized hereon, and Holders are referred to the Indenture and the TIA for a statement of such terms. The Notes are senior unsecured obligations of the Company limited as provided in the Indenture to $300,000,000 in aggregate principal amount, unless an election has been made as set forth in Article 2 of the Indenture to increase such aggregate principal amount to an amount not to exceed $350,000,000.

Capitalized terms not defined herein have the same meaning as is given to them in the Indenture.

5. DENOMINATIONS, TRANSFER, EXCHANGE. The Notes are in registered form without coupons in denominations of $1,000 and integral multiples of $1,000. The transfer of Notes may be registered and Notes may be exchanged as provided in the Indenture. As a condition of transfer, the Registrar and the Trustee may require a Holder, among other things, to furnish appropriate endorsements and transfer documents, and the Company and the Registrar may require a Holder to pay any taxes and fees permitted by the Indenture.

6. PERSONS DEEMED OWNERS. The person in whose name the Notes are registered on the Registrar’s books will be treated as its owner for all purposes.

7. AMENDMENTS AND WAIVERS. Subject to certain exceptions, the Indenture and the Notes may be amended or supplemented with the consent of the Holders of at least a majority in aggregate principal amount of the then outstanding Notes (including consents obtained in connection with a tender offer or exchange offer for the Notes), and any existing Default (except a Default or Event of Default in the payment of principal of or interest or Liquidated Damages, if any, on the Notes) may be waived with the consent of the Holders of at least a majority in aggregate principal amount of the then outstanding Notes (including consents obtained in connection with a tender offer or exchange offer for the Notes).

Without the consent of any Holder, the Indenture or the Notes may be amended to: (a) cure any ambiguity, defect or inconsistency or make any other changes in the provisions of the Indenture which the Company and the Trustee may deem necessary or desirable, provided that such amendment does not materially and adversely affect the rights of the Holders under the Indenture; (b) evidence the succession of another person to the Company and provide for the assumption by such successor of the covenants and obligations of the Company under the Indenture and the Notes; (c) provide for the conversion rights of Holders in the event of

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consolidation or merger or sale of all or substantially all of the assets of the Company; (d) reduce the Conversion Price; (e) evidence and provide for the acceptance of appointment under the Indenture of a successor Trustee; (f) make any changes that would provide the Holders with any additional rights or benefits or that do not adversely affect the legal rights under the Indenture of any Holder; (g) comply with the requirements of the Commission in order to effect or maintain the qualification of the Indenture under the TIA; or (h) modify the restrictions on, and procedures for, resale and other transfers of the shares of Common Stock pursuant to law, regulation or practice relating to the resale or transfer of restricted securities generally.

Without the consent of each Holder affected, an amendment or waiver may not (with respect to any Notes held by a non-consenting Holder): (a) reduce the principal amount of Notes whose Holders must consent to an amendment, supplement or waiver; (b) reduce the principal of or change the fixed maturity of any Note or, except as permitted pursuant to Section 9.01 of the Indenture, alter the redemption or repurchase provisions with respect to the Notes; (c) reduce the rate of, or change the time for payment of, interest, including defaulted interest and Liquidated Damages, if any, and any Redemption Price, Purchase Price or Designated Event Repurchase Price, if applicable, on any Note; (d) waive a Default or Event of Default in the payment of principal or interest or Liquidated Damages, if any, on the Notes (except a rescission of acceleration of the Notes by the Holders of at least a majority in aggregate principal amount of the Notes then outstanding and a waiver of the payment default that resulted from such acceleration); (e) make the principal or interest or Liquidated Damages, if any, on any Note payable in money other than as provided for in the Indenture and in the Notes; (f) make any change in the provisions of the Indenture relating to waivers of past Defaults or the rights of Holders to receive payments of principal of or interest or Liquidated Damages, if any, and any Redemption Price, Purchase Price or Designated Event Repurchase Price, if applicable, on the Notes; (g) waive a Designated Event Repurchase Price with respect to any Note; (h) increase the Conversion Price or, except as permitted by the Indenture (including Section 9.01), modify the provisions of the Indenture relating to conversion of the Notes in a manner adverse to the Holders thereof; or (i) make any changes to the abilities of Holders to enforce their rights under the Indenture or the provisions of clauses (a) through (i) of Section 9.02 of the Indenture.

8. REDEMPTION AND PURCHASE. The Company, at its option, may redeem all or a portion of the Notes on or after June 5, 2008 at a redemption price in cash (“Redemption Price”) equal to 100% of the principal amount thereof, plus any accrued and unpaid interest to, but excluding, the Redemption Date. At least 30 days but not more than 60 days before a Redemption Date, the Company shall mail a notice of redemption by first-class mail, postage prepaid, to each Holder of Notes to be redeemed.

Following a Designated Event, the Company shall make a Designated Event Offer to repurchase all Notes then outstanding at a Designated Event Repurchase Price equal to 100% of the principal amount of the Notes, plus any accrued and unpaid interest to, but excluding, the Designated Event Repurchase Date, in accordance with the terms and conditions set forth in the Indenture. To accept the Designated Event Offer, the Holder hereof must comply with the terms thereof, including surrendering this Note with the “Designated Event Repurchase Notice” portion thereof completed to the Trustee, with a copy to the Paying Agent, at any time on or prior to the Designated Event Offer Termination Date, as provided in the Indenture.

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Subject to the terms and conditions of the Indenture, Notes shall be purchased by the Company at the option of the Holder thereof, in whole or in part, at a purchase price in cash (the “Purchase Price”) equal to 100% of the principal amount thereof, plus any accrued and unpaid interest to, but excluding, the relevant Purchase Date of June 3, 2008, June 3, 2013 and June 3, 2018, as applicable, upon delivery of a Purchase Notice containing the information set forth in the Indenture, at any time from the opening of business on the date that is at least 20 business days prior to the relevant Purchase Date until the close of business on the fifth business day prior to such Purchase Date.

9. CONVERSION. Subject to the provisions of this paragraph 9, and subject to and upon compliance with the provisions of the Indenture, the principal amount of the Note, or any portion of such principal amount which is $1,000 or an integral multiple thereof, may be converted, subject to the conditions and during the periods described below, into that number of fully paid and non-assessable shares of Common Stock obtained by dividing the principal amount of the Note or portion thereof to be converted by the conversion price of $28.00 per share, as adjusted from time to time as provided in the Indenture (the “Conversion Price”), upon surrender of the Note to the Company at the office or agency maintained for such purpose (or at such other offices or agencies designated for such purpose by the Company), accompanied by written notice of conversion duly executed (and if the shares of Common Stock to be issued on conversion are to be issued in any name other than that of the registered Holder of this Note, by instruments of transfer, in form satisfactory to the Company, duly executed by the registered Holder or its duly authorized attorney).

In case such surrender shall be made during the period from the close of business on any Regular Record Date immediately preceding any Interest Payment Date to the opening of business on such Interest Payment Date, the Note also shall be accompanied by payment, in funds acceptable to the Company, of an amount equal to the accrued and unpaid interest, if any, otherwise payable on such Interest Payment Date on the principal amount of the Note then being converted; provided, however, that no such payment need be made if (i) there exists at the time of conversion a default in the payment of principal of or interest or Liquidated Damages, if applicable, on the Notes (including any principal of or interest payable in connection with a repurchase pursuant to Section 4.08 or Section 4.09 and a redemption pursuant to Section 4.01); or (ii) the Company shall have specified a Redemption Date that is after the Regular Record Date and prior to such Interest Payment Date. Subject to the aforesaid requirement for a payment in the event of conversion during the period from the close of business on any Regular Record Date immediately preceding any Interest Payment Date to the opening of business on such Interest Payment Date, no adjustment shall be made on conversion for interest, if any, accrued and unpaid hereon or for dividends on Common Stock delivered on conversion.

The Conversion Price will be adjusted for dividends or distributions on Common Stock payable in Common Stock; subdivisions or combinations of Common Stock; distributions to all holders of Common Stock of certain rights or warrants to purchase Common Stock, for a period expiring within 45 days after the date of such distribution, at a price less than the Current Market Price; distributions to all holders of Common Stock of shares of Capital Stock (other than Common Stock) or evidences of the Company’s Indebtedness or assets; certain dividends or other distributions consisting exclusively of cash (other than regular quarterly cash dividends) to holders of Common Stock; and certain purchases of the Common Stock pursuant to tender offers

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by the Company or any subsidiary of the Company, in each case, in accordance with the terms and conditions set forth in the Indenture. Additionally, the Indenture permits the Company to, from time to time, to the extent permitted by law, reduce the Conversion Price by any amount for any period of at least 20 days, if the Board of Directors has made a determination that such reduction would be in the Company’s best interests, which determination shall be conclusive and described in a resolution of the Board of Directors.

The Company shall not issue fractional shares or scrips representing fractions of shares of Common Stock upon any such conversion, but shall make an adjustment therefor in cash based upon the Current Market Price of the Common Stock for the five consecutive trading days immediately preceding the Conversion Date. If more than one Note shall be surrendered for conversion at one time by the same Holder, the number of full shares which shall be issuable upon conversion shall be computed on the basis of the aggregate principal amount of the Notes (or specified portions thereof to the extent permitted hereby) so surrendered for conversion.

A Note in respect of which a Holder has delivered a Purchase Notice or Designated Event Repurchase Notice exercising the option of such Holder to require the Company to purchase such Note may be converted only if such notice of exercise is withdrawn in accordance with the terms of the Indenture.

Conversion Upon Satisfaction of Sale Price Condition. Subject to the provisions of this paragraph 9, and subject to and upon compliance with the provisions of the Indenture, and notwithstanding the fact that any other condition to conversion has not been satisfied, the Holder of this Note has the right to convert this Note into shares of Common Stock in any calendar quarter after the quarter ending June 30, 2003 if the last reported sale price of the Common Stock for at least 20 trading days during the period of 30 consecutive trading days ending on the last trading day of the immediately preceding calendar quarter is greater than or equal to 130% of the Conversion Price on such last trading day.

The “last reported sale price” of the Common Stock on any date means the closing price for such Common Stock, as set forth in Section 11.05 of the Indenture. The Company shall notify the Holders upon determination that Holders are or will be entitled to convert their Notes, or any portion of such principal amount which is $1,000 or an integral multiple thereof, into fully paid and non-assessable shares of Common Stock in accordance with this paragraph 9, by issuing a press release and publishing such determination on the Company’s web site.

Conversion Based on Trading Price of the Notes. Subject to the provisions of this paragraph 9, and subject to and upon compliance with the provisions of the Indenture, and notwithstanding the fact that any other condition to conversion has not been satisfied, the Holder of this Note has the right to convert this Note into shares of Common Stock during the five business day period following any 10 consecutive trading days in which the average of the trading prices for the Notes for that 10 trading days was less than 98% of the average closing price (as defined in Section 11.05(g) of the Indenture) of the Common Stock during such period multiplied by the Conversion Rate. The “Conversion Rate” shall be equal to the number of shares of Common Stock issuable upon conversion of a Note per $1,000 of principal amount thereof (i.e., $1,000 principal amount of the Note being converted divided by the applicable Conversion Price).

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The “trading price” of the Notes on any date of determination means the average of the secondary market bid quotations per Note obtained by the Trustee for $10,000,000 principal amount of the Notes at approximately 3:30 p.m., New York City time, on such determination date from three independent nationally recognized securities dealers selected by the Company; provided that if at least three such bids cannot be obtained, but two such bids are obtained by the Trustee, then the average of the two bids shall be used. If the Trustee cannot reasonably obtain at least two bids for $10,000,000 principal amount of the Notes from a nationally recognized securities dealer or, in the reasonable judgment of the Company, the bid quotations are not indicative of the secondary market value of the Notes, then the trading price of the Notes will be deemed to be equal to 97.9% of (a) the Conversion Rate of the Notes as of the applicable date of determination multiplied by (b) the closing price (as set forth in Section 11.05 of the Indenture) of the Common Stock on such determination date.

The Trustee will determine the trading price of the Notes during the applicable period at the request of the Company. The Company shall make such request upon receipt of reasonable evidence from the Holder that the trading price of the Notes may be less than 98% of the average closing price (as set forth in Section 11.05 of the Indenture) of the Common Stock multiplied by the Conversion Rate during the applicable period.

Conversion Upon Notice of Redemption. Subject to the provisions of this paragraph 9, and subject to and upon compliance with the provisions of the Indenture, and notwithstanding the fact that any other condition to conversion has not been satisfied, the Holder of this Note has the right to convert into shares of Common Stock the Notes or a portion thereof which has been called for redemption pursuant to Article 4 of the Indenture; provided that such Note or a portion thereof is surrendered for conversion on or prior to the close of business on the Redemption Date in accordance with the terms of the Indenture.

Conversion Upon Specified Corporate Transactions. Subject to the provisions of this paragraph 9, and subject to and upon compliance with the provisions of the Indenture, and notwithstanding the fact that any other condition to conversion has not been satisfied, the Holder of this Note has the right to convert this Note into shares of Common Stock in the event that the Company (i) issues rights or warrants to all holders of its outstanding shares of Common Stock entitling them to subscribe for or purchase, for a period expiring within 45 days after the date of issuance, shares of Common Stock at a price per share less than the last reported sale price (as defined above) per share of Common Stock on the trading day (as defined in Section 11.05(g)) immediately preceding the date of the issuance; or (ii) distributes to all holders of its outstanding shares of Common Stock any assets or debt securities of the Company, or rights to purchase any securities of the Company, which distribution has a per share value, as determined by the Board of Directors (whose determination shall be conclusive and described in a resolution of the Board of Directors), that exceeds 15% of the last reported sale price (as defined above) per share of Common Stock on the trading day (as defined in Section 11.05(g)) immediately preceding the date of declaration of such distribution. The Company will be required to give notice to the Holders at least 20 business days prior to the ex-dividend date for such distribution, and Notes may be surrendered for conversion at any time thereafter until the earlier of the close of business on the business day immediately prior to the ex-dividend date and the announcement by the Company that such distribution will not take place, even if the Notes are not otherwise convertible at such time. The “ex-dividend date” shall mean the first date upon which the sale of

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the Common Stock does not automatically transfer the right to receive the relevant distribution from the seller of the Common Stock to its buyer.

Subject to the provisions of this paragraph 9, and subject to and upon compliance with the provisions of the Indenture, and notwithstanding the fact that any other condition to conversion has not been satisfied, the Holder of this Note has the right to convert this Note into shares of Common Stock in the event the Company is a party to any consolidation, merger, share exchange or combination pursuant to which the Common Stock would be converted into cash, securities or other property as set forth in Section 11.06 of the Indenture, the Notes may be surrendered for conversion at any time from and after the date which is 15 days prior to the anticipated effective date of the transaction until 15 days after the actual effective date of such transaction and, at the effective time of such transaction, the right to convert a Note into Common Stock will be deemed to have changed into a right to convert such Note into the kind and amount of cash, securities or other property of the Company or another person which the Holder would have received if the Holder had converted its Notes immediately prior to the applicable record date for such transaction.

10. DEFAULTS AND REMEDIES. An Event of Default is: (a) a default in payment of the principal on the Notes when due upon redemption, repurchase or otherwise; (b) a default for 30 days in the payment of any installment of interest or Liquidated Damages on the Notes when due (including any interest payable in connection with a repurchase or redemption of the Notes pursuant to the terms of the Indenture); (c) a failure to comply with or observe in any material respect any covenant or agreement of the Company in respect of the Notes as set forth in the Indenture for 60 days after written notice to the Company from the Trustee or to the Company and the Trustee from Holders of at least 25% in aggregate principal amount of the then outstanding Notes; (d) a default in the payment of the Designated Event Repurchase Price in respect of the Notes when the same becomes due; (e) a default in any credit agreement, mortgage, indenture or instrument under which there may be issued or by which there may be secured or evidenced any Indebtedness for money borrowed by the Company or any Restricted Subsidiary (other than any such Indebtedness which is non-recourse to the Company or such Restricted Subsidiary), which default is caused by a failure to pay when due any principal on such Indebtedness at the final stated maturity date of such Indebtedness, which failure continues beyond any applicable grace period, or results in the acceleration of such indebtedness prior to its express maturity, without such acceleration being rescinded or annulled, and, in each case, the principal amount of such Indebtedness, together with the principal amount of any other such Indebtedness under which there is a payment default at the final stated maturity thereof or the maturity of which has been so accelerated, aggregates to $75 million or more and such payment default is not cured or such acceleration is not annulled within 30 days after written notice to the Company by the Trustee or to the Company and the Trustee by Holders of not less than 25% in aggregate principal amount of the Notes then outstanding; and (f) certain events involving bankruptcy, insolvency or reorganization of the Company.

If an Event of Default occurs and is continuing, the Trustee, by written notice to the Company, or the Holders of at least 25% in principal amount of the then outstanding Notes, by written notice to the Company and the Trustee, may declare the unpaid principal of, and accrued and unpaid interest and Liquidated Damages, if any, on all Notes then outstanding to be due and payable immediately, except that in the case of an Event of Default arising from certain events of

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bankruptcy, insolvency, or reorganization with respect to the Company, all outstanding Notes become due and payable without further action or notice. Holders may not enforce the Indenture or the Notes except as provided in the Indenture. The Trustee may require an indemnity satisfactory to it before it enforces the Indenture or the Notes. Subject to certain limitations, Holders of at least a majority in principal amount of the then outstanding Notes may direct the Trustee in its exercise of any trust or power. The Trustee may withhold from Holders notice of any continuing default (except a default in payment of principal of, or interest or Liquidated Damages, if any, and the Redemption Price, Purchase Price or Designated Event Repurchase Price, if applicable) if it determines that withholding notice is in their interests. The Company must furnish annual compliance certificates to the Trustee in accordance with the terms of the Indenture.

11. TRUSTEE DEALINGS WITH THE COMPANY. Subject to Section 7.10 of the Indenture, the Trustee or any of its Affiliates, in their individual or any other capacities, may make or continue loans to or guaranteed by, accept deposits from and perform services for the Company or its Affiliates and may otherwise deal with the Company or its Affiliates as if it were not Trustee.

12. NO RECOURSE AGAINST OTHERS. No director, officer, employee, stockholder or Affiliate, as such, of the Company shall have any liability for any obligations of the Company under the Notes or the Indenture or for any claim based on, in respect of or by reason of such obligations or their creation. Each Holder by accepting a Note waives and releases all such liability with respect to each director, officer, employee, stockholder and Affiliate of the Company. The waiver and release are part of the consideration for the Notes.

13. AUTHENTICATION. This Note shall not be valid until authenticated by the manual signature of the Trustee or an authenticating agent.

14. ABBREVIATIONS. Customary abbreviations may be used in the name of a Holder or an assignee, such as: TEN CO = tenants in common, TEN ENT = tenants by the entireties, JT TEN = joint tenants with right of survivorship and not as tenants in common, CUST = Custodian and U/G/M/A = Uniform Gifts to Minors Act.

15. REGISTRATION RIGHTS AGREEMENT. The Holder of this Note is entitled to the benefits of a Registration Rights Agreement, dated June 2, 2003, between the Company and the Initial Purchaser (the “Registration Rights Agreement”).

In accordance with the terms of the Registration Rights Agreement, during any period in which a Registration Default (as defined in the Registration Rights Agreement) has occurred and is continuing, the Company will pay Liquidated Damages in an amount equal .25% (or 25 basis points) per annum per $1,000 principal amount of notes or $2.50 per annum per 35.7143 shares of Common Stock (subject to adjustment from time to time in the event of a stock split, stock recombination, stock dividend and similar events) constituting Transfer Restricted Securities (as defined in the Registration Rights Agreement), in accordance with the terms of the Registration Rights Agreement.

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Liquidated Damages in respect of the Notes, if any, will be payable in cash semiannually, in arrears, on each Interest Payment Date to the person in whose name each Note is registered at the close of business on the Regular Record Date immediately preceding the relevant Interest Payment Date, and will cease to accrue on the date the Registration Default is cured. The above description of certain provisions of the Registration Rights Agreement is qualified by reference to, and is subject in its entirety to, the more complete description thereof contained in the Registration Rights Agreement.

The Company will furnish to any Holder upon written request and without charge a copy of the Indenture and the Registration Rights Agreement. Requests may be made to: Delta Air Lines, Inc., P.O. Box 20706, Atlanta, Georgia 30320, Attention: Investor Relations, Department No. 829, Telephone No.: (404) 715-2600.

16. SINKING FUND. The Notes do not have the benefit of any sinking fund obligations.

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FORM OF CONVERSION NOTICE

To: DELTA AIR LINES, INC.

The undersigned beneficial owner of this Note hereby irrevocably exercises the option to convert this Note, or portion hereof (which is $1,000 or an integral multiple thereof) below designated, into shares of Common Stock of Delta Air Lines, Inc. in accordance with the terms of the Indenture referred to in this Note, and directs that the shares issuable and deliverable upon the conversion, together with any check in payment for fractional shares and Notes representing any unconverted principal amount hereof, be issued and delivered to the beneficial owner hereof unless a different name has been indicated below. If shares or any portion of this Note not converted are to be issued in the name of a person other than the undersigned, the undersigned will pay all transfer taxes payable with respect thereto. Any amount required to be paid by the undersigned on account of interest and taxes accompanies this Note.

Dated:
Fill in for registration of shares if to be delivered, and Notes if to be issued, other than to and in the name of the beneficial owner (Please Print):
	Signature(s)
	Principal amount to be converted
(Name)	(if less than all):
	$                    ,000
(Street Address)
	Social Security or other Taxpayer Identification Number
(City, State and Zip Code)
Signature Guarantee:*

* Signatures must be guaranteed by an eligible Guarantor Institution (banks, brokers, dealers, savings and loan associations and credit unions) with membership in an approved signature guarantee medallion program pursuant to Securities and Exchange Commission Rule 17Ad-15 if shares are to be issued, or Notes are to be delivered, other than to and in the name of the registered Holder(s).

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ASSIGNMENT FORM

To assign this Note, fill in the form below:

(I) or (we) assign and transfer this Note to

______________________________________________________________________________________________________________________________

(Insert assignee’s social security or tax I.D. no.)

______________________________________________________________________________________________________________________________

______________________________________________________________________________________________________________________________

______________________________________________________________________________________________________________________________

(Print or type assignee’s name, address and zip code)

and irrevocably appoint                                                       as agent to transfer this Note on the books of the Company. The agent may substitute another to act for him.

Your Signature:                                                                                                                                                                                               

(Sign exactly as your name appears on the other side of this Note)

Date:                     

Medallion Signature Guarantee:                                                                                                           

[FOR INCLUSION ONLY IF THIS NOTE BEARS A RESTRICTED SECURITIES LEGEND] In connection with any transfer of any of the Notes evidenced by this certificate that are “restricted securities” (as defined in Rule 144 (or any successor thereto) under the Securities Act), the undersigned confirms that such Notes are being transferred:

CHECK ONE BOX BELOW

(1)    ¨    to the Company; or

(2)    ¨    pursuant to and in compliance with Rule 144A under the Securities Act of 1933; or

(3)    ¨    pursuant to and in compliance with Regulation S under the Securities Act of 1933; or

(4)    ¨    pursuant to an exemption from registration under the Securities Act of 1933 provided by Rule 144 thereunder.

Unless one of the boxes is checked, the Registrar will refuse to register any of the Notes evidenced by this certificate in the name of any person other than the registered Holder thereof; provided, however, that if box (3) or (4) is checked, the Trustee may require, prior to registering any such transfer of the Notes, such certifications and other information, and if box (4) is checked such legal opinions, as the Company has reasonably requested in writing, by delivery to the Trustee of a standing letter of instruction, to confirm that such transfer is being made pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act of 1933; provided that this paragraph shall not be applicable to any Notes which are not “restricted securities” (as defined in Rule 144 (or any successor thereto) under the Securities Act).

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Your Signature:                                                                                                                                                                                     

(Sign exactly as your name appears on the other side of this Note)

Date:                     

Medallion Signature Guarantee:                                                                                                                                                     

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DESIGNATED EVENT REPURCHASE NOTICE

If you wish to have this Note repurchased by the Company pursuant to Section 4.09 of the Indenture, check the Box: ¨

If you wish to have a portion of this Note repurchased by the Company pursuant to Section 4.09 of the Indenture, state the amount (in multiples of $1,000): $                    , 000.

Date:                     Your Signature:                                                                                                                                                          

(Sign exactly as your name appears on the other side of this Note)

Medallion Signature Guarantee:                                                                                                                                                               

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EXHIBIT B

[FORM OF RESTRICTED COMMON STOCK LEGEND]

“THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR ANY STATE SECURITIES LAWS. THE HOLDER HEREOF, BY PURCHASING THIS SECURITY, AGREES FOR THE BENEFIT OF DELTA AIR LINES, INC. THAT THIS SECURITY MAY NOT BE OFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED PRIOR TO THE LATER OF (X) THE EXPIRATION OF THE HOLDING PERIOD APPLICABLE TO THE SALES OF THE SECURITY EVIDENCED HEREBY UNDER RULE 144(k) UNDER THE SECURITIES ACT (OR ANY SUCCESSOR PROVISION) OR (Y) THREE MONTHS AFTER SUCH HOLDER CEASES TO BE AN “AFFILIATE” (WITHIN THE MEANING OF RULE 144 UNDER THE SECURITIES ACT) OF DELTA AIR LINES, INC., OTHER THAN (1) TO DELTA AIR LINES, INC., (2) SO LONG AS THIS SECURITY IS ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES ACT (“RULE 144A”), TO A PERSON WHO THE SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A, PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (3) IN AN OFFSHORE TRANSACTION (AS DEFINED IN REGULATION S UNDER THE SECURITIES ACT) IN ACCORDANCE WITH REGULATION S UNDER THE SECURITIES ACT, (4) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE 144 (IF AVAILABLE) UNDER THE SECURITIES ACT OR (5) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, IN EACH CASE IN ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES AND OTHER JURISDICTIONS. THE HOLDER HEREOF, BY PURCHASING THIS SECURITY, REPRESENTS AND AGREES FOR THE BENEFIT OF DELTA AIR LINES, INC. THAT IT IS (1) A QUALIFIED INSTITUTIONAL BUYER OR (2) NOT A U.S. PERSON AND IS OUTSIDE THE UNITED STATES WITHIN THE MEANING OF (OR AN ACCOUNT SATISFYING THE REQUIREMENTS OF PARAGRAPH (k)(2) OF RULE 902 UNDER) REGULATION S UNDER THE SECURITIES ACT. IN ANY CASE THE HOLDER HEREOF WILL NOT, DIRECTLY OR INDIRECTLY, ENGAGE IN ANY HEDGING TRANSACTION WITH REGARD TO THIS SECURITY OR ANY COMMON STOCK ISSUABLE UPON CONVERSION OF THIS SECURITY EXCEPT AS PERMITTED BY THE SECURITIES ACT.”

B-1

EXHIBIT C

FORM OF TRANSFER CERTIFICATE FOR TRANSFER

OF RESTRICTED COMMON STOCK

(Transfers pursuant to Section 11.11(b) of the Indenture)

[NAME AND ADDRESS OF  

COMMON STOCK TRANSFER AGENT]

Re: Delta Air Lines, Inc. 8.00% Convertible Senior Notes
due 2023 (the “Convertible Senior Notes”)

Reference is hereby made to the Indenture dated as of June 2, 2003 (the “Indenture”) between Delta Air Lines, Inc. and The Bank of New York Trust Company of Florida, N.A., as Trustee. Capitalized terms used but not defined herein shall have the meanings given them in the Indenture.

This letter relates to              shares of Common Stock [represented by the accompanying certificate(s) that were] [to be] issued upon conversion of Convertible Senior Notes and which are held in the name of [name of transferor] (the “Transferor”) to effect the transfer of such Common Stock.

In connection with the transfer of such shares of Common Stock, the undersigned confirms that such shares of Common Stock are being transferred:

CHECK ONE BOX BELOW

(1)    ¨    to the Company; or

(2)    ¨    pursuant to and in compliance with Rule 144A under the Securities Act of 1933; or

(3)    ¨    pursuant to and in compliance with Regulation S under the Securities Act of 1933; or

(4)    ¨    pursuant to an exemption from registration under the Securities Act of 1933 provided by Rule 144 thereunder.

C-1

Unless one of the boxes is checked, the transfer agent will refuse to register any of the Common Stock [evidenced by this certificate] [to be issued to] in the name of any person other than the registered Holder thereof; provided, however, that if box (2) or (3) is checked, the transfer agent may require, prior to registering any such transfer of the Common Stock such certifications and other information, and if box (4) is checked such legal opinions, as the Company has reasonably requested in writing, by delivery to the transfer agent of a standing letter of instruction, to confirm that such transfer is being made pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act of 1933.

[Name of Transferor],

By:

Name:

Title:

Dated:

C-2

EX-5.1

Exhibit 5.1

OPINION OF DAVIS POLK & WARDWELL

                            August 22, 2003

Delta Air Lines, Inc.

Hartsfield Atlanta International Airport

Atlanta, Georgia 30320

Ladies and Gentlemen:

We have acted as counsel in connection with the Registration Statement on Form S-3 (the “Registration Statement”) filed by Delta Air Lines, Inc. (the “Company”) with the Securities and Exchange Commission pursuant to the Securities Act of 1933, as amended (the “Securities Act”), for the registration of the sale from time to time of (i) up to $350,000,000 aggregate principal amount of the Company’s 8.00% Convertible Senior Notes due 2023 (the “Debt Securities”) issued pursuant to the Indenture dated as of June 2, 2003 (the “Indenture”) between the Company and The Bank of New York Trust Company of Florida, N.A., as trustee, and (ii) such indeterminate number of shares of the Company’s common stock, par value $1.50 per share (the “Common Stock”), as may be issuable upon conversion of the Debt Securities. The Debt Securities and the Common Stock are collectively referred to herein as the “Securities.” The Securities are to be offered and sold from time to time by certain securityholders of the Company. Capitalized terms used herein but not defined have the same meanings as provided in the Registration Statement.

We have examined the originals or copies certified or otherwise identified to our satisfaction of such corporate records of the Company and such other documents and certificates as we have deemed necessary as a basis for the opinions hereinafter expressed.

Based on the foregoing, we are of the opinion that:

1. The Debt Securities have been duly authorized by the Company, are valid and binding obligations of the Company, enforceable in accordance with their terms, subject to applicable bankruptcy, insolvency or similar laws affecting creditors’ rights generally and general principles of equity, and are entitled to the benefits of the Indenture.

2. The shares of Common Stock reserved for issuance upon conversion of the Debt Securities have been duly authorized and reserved, and, when issued upon conversion of the Debt Securities in accordance with the terms of the Debt Securities and the Indenture, will be validly issued, fully paid and non-assessable, and the issuance of the shares of Common Stock will not be

subject to any preemptive or, to our knowledge, other similar rights.

In addition, the statements in the prospectus which forms a part of the Registration Statement under the heading “Certain U.S. Federal Income Tax Consequences” insofar as they purport to constitute summaries of matters of U.S. federal tax law and regulations or legal conclusions with respect thereto, constitute accurate summaries of the matters described therein in all material respects.

We are members of the Bar of the State of New York and the foregoing opinion is limited to the laws of the State of New York, the federal laws of the United States of America and the General Corporation Law of the State of Delaware.

We hereby consent to the filing of this opinion as an exhibit to the Registration Statement. In addition, we consent to the reference to us under the caption “Validity of the Securities” in the prospectus which forms a part of the Registration Statement, without admitting that we are experts within the meaning of the Securities Act.

This opinion is rendered solely to you in connection with the above matter. This opinion may not be relied upon by you for any other purpose or relied upon by or furnished to any other person without our prior written consent.

Very truly yours,

/s/ Davis Polk & Wardwell

EX-15.1

Exhibit 15.1

Letter from Deloitte & Touche LLP

Regarding Unaudited Interim Financial Information

August 21, 2003

Delta Air Lines, Inc.

Atlanta, Georgia

We have made a review, in accordance with standards established by the American Institute of Certified Public Accountants, of the unaudited interim financial information of Delta Air Lines, Inc. and subsidiaries for the periods ended March 31, 2003 and 2002, and June 30, 2003 and 2002, as indicated in our reports dated April 17, 2003, and August 8, 2003, respectively; because we did not perform an audit, we expressed no opinion on that information.

We are aware that our reports referred to above, which were included in your Quarterly Reports on Form 10-Q for the quarters ended March 31, 2003, and June 30, 2003, are being incorporated by reference in this Registration Statement.

We also are aware that the aforementioned reports, pursuant to Rule 436(c) under the Securities Act of 1933, are not considered a part of the Registration Statement prepared or certified by an accountant or a report prepared or certified by an accountant within the meaning of Sections 7 and 11 of that Act.

/s/ Deloitte & Touche LLP

Atlanta, Georgia

EX-23.1

Exhibit 23.1

INDEPENDENT AUDITORS’ CONSENT

We consent to the incorporation by reference in this Registration Statement of Delta Air Lines, Inc. on Form S-3 of our report dated January 31, 2003 (which report expresses an unqualified opinion and includes explanatory paragraphs relating to (1) the Company’s change in its method of accounting for goodwill and other intangible assets to conform with Statement of Financial Accounting Standards No. 142 and (2) the application of procedures relating to certain revised disclosures in Notes 5, 9, 17 and 21 related to the 2001 and 2000 consolidated financial statements that were audited by other auditors who have ceased operations and for which we have expressed no opinion or other form of assurance other than with respect to such disclosures), incorporated by reference in the Annual Report on Form 10-K of Delta Air Lines, Inc. for the year ended December 31, 2002, and to the reference to us under the heading “Experts” in the Prospectus, which is part of this Registration Statement.

/s/ Deloitte & Touche LLP

Atlanta, Georgia

August 21, 2003

EX-24.1

Exhibit 24.1

POWER OF ATTORNEY

I hereby constitute and appoint M. Michele Burns and James M. Whitehurst, and each of them separately, my true and lawful attorneys-in-fact, with full power of substitution, for me and in my name, in any and all capacities, to sign one or more registration statements on Form S-3 in such form as said attorneys deem appropriate or advisable, to be filed with the Securities and Exchange Commission by Delta Air Lines, Inc. (the “Company”) in respect of the issuance of up to $350,000,000 aggregate principal amount of 8% Convertible Senior Notes due 2023 of the Company, and all amendments to such registration statement (including post-effective amendments and any related registration statements filed pursuant to Rule 462), and to file the same with the Securities and Exchange Commission.

IN WITNESS WHEREOF, I have hereunto signed this power of attorney as of this 1st day of August, 2003.

/s/ Leo F. Mullin

Leo F. Mullin

Delta Air Lines, Inc.

POWER OF ATTORNEY

I hereby constitute and appoint Leo F. Mullin, M. Michele Burns and James M. Whitehurst, and each of them separately, my true and lawful attorneys-in-fact, with full power of substitution, for me and in my name, in any and all capacities, to sign one or more registration statements on Form S-3 in such form as said attorneys deem appropriate or advisable, to be filed with the Securities and Exchange Commission by Delta Air Lines, Inc. (the “Company”) in respect of the issuance of up to $350,000,000 aggregate principal amount of 8% Convertible Senior Notes due 2023 of the Company, and all amendments to such registration statement (including post-effective amendments and any related registration statements filed pursuant to Rule 462), and to file the same with the Securities and Exchange Commission.

IN WITNESS WHEREOF, I have hereunto signed this power of attorney as of this 1st day of August, 2003.

/s/ Edward H. Budd

Director

Delta Air Lines, Inc.

POWER OF ATTORNEY

I hereby constitute and appoint Leo F. Mullin, M. Michele Burns and James M. Whitehurst, and each of them separately, my true and lawful attorneys-in-fact, with full power of substitution, for me and in my name, in any and all capacities, to sign one or more registration statements on Form S-3 in such form as said attorneys deem appropriate or advisable, to be filed with the Securities and Exchange Commission by Delta Air Lines, Inc. (the “Company”) in respect of the issuance of up to $350,000,000 aggregate principal amount of 8% Convertible Senior Notes due 2023 of the Company, and all amendments to such registration statement (including post-effective amendments and any related registration statements filed pursuant to Rule 462), and to file the same with the Securities and Exchange Commission.

IN WITNESS WHEREOF, I have hereunto signed this power of attorney as of this 1st day of August, 2003.

/s/ George M. C. Fisher

Director

Delta Air Lines, Inc.

POWER OF ATTORNEY

I hereby constitute and appoint Leo F. Mullin, M. Michele Burns and James M. Whitehurst, and each of them separately, my true and lawful attorneys-in-fact, with full power of substitution, for me and in my name, in any and all capacities, to sign one or more registration statements on Form S-3 in such form as said attorneys deem appropriate or advisable, to be filed with the Securities and Exchange Commission by Delta Air Lines, Inc. (the “Company”) in respect of the issuance of up to $350,000,000 aggregate principal amount of 8% Convertible Senior Notes due 2023 of the Company, and all amendments to such registration statement (including post-effective amendments and any related registration statements filed pursuant to Rule 462), and to file the same with the Securities and Exchange Commission.

IN WITNESS WHEREOF, I have hereunto signed this power of attorney as of this 1st day of August, 2003.

/s/ David R. Goode

Director

Delta Air Lines, Inc.

POWER OF ATTORNEY

I hereby constitute and appoint Leo F. Mullin, M. Michele Burns and James M. Whitehurst, and each of them separately, my true and lawful attorneys-in-fact, with full power of substitution, for me and in my name, in any and all capacities, to sign one or more registration statements on Form S-3 in such form as said attorneys deem appropriate or advisable, to be filed with the Securities and Exchange Commission by Delta Air Lines, Inc. (the “Company”) in respect of the issuance of up to $350,000,000 aggregate principal amount of 8% Convertible Senior Notes due 2023 of the Company, and all amendments to such registration statement (including post-effective amendments and any related registration statements filed pursuant to Rule 462), and to file the same with the Securities and Exchange Commission.

IN WITNESS WHEREOF, I have hereunto signed this power of attorney as of this 1st day of August, 2003.

/s/ Gerald Grinstein

Director

Delta Air Lines, Inc.

POWER OF ATTORNEY

I hereby constitute and appoint Leo F. Mullin, M. Michele Burns and James M. Whitehurst, and each of them separately, my true and lawful attorneys-in-fact, with full power of substitution, for me and in my name, in any and all capacities, to sign one or more registration statements on Form S-3 in such form as said attorneys deem appropriate or advisable, to be filed with the Securities and Exchange Commission by Delta Air Lines, Inc. (the “Company”) in respect of the issuance of up to $350,000,000 aggregate principal amount of 8% Convertible Senior Notes due 2023 of the Company, and all amendments to such registration statement (including post-effective amendments and any related registration statements filed pursuant to Rule 462), and to file the same with the Securities and Exchange Commission.

IN WITNESS WHEREOF, I have hereunto signed this power of attorney as of this 1st day of August, 2003.

/s/ James M. Kilts

Director

Delta Air Lines, Inc.

POWER OF ATTORNEY

I hereby constitute and appoint Leo F. Mullin, M. Michele Burns and James M. Whitehurst, and each of them separately, my true and lawful attorneys-in-fact, with full power of substitution, for me and in my name, in any and all capacities, to sign one or more registration statements on Form S-3 in such form as said attorneys deem appropriate or advisable, to be filed with the Securities and Exchange Commission by Delta Air Lines, Inc. (the “Company”) in respect of the issuance of up to $350,000,000 aggregate principal amount of 8% Convertible Senior Notes due 2023 of the Company, and all amendments to such registration statement (including post-effective amendments and any related registration statements filed pursuant to Rule 462), and to file the same with the Securities and Exchange Commission.

IN WITNESS WHEREOF, I have hereunto signed this power of attorney as of this 1st day of August, 2003.

/s/ John F. Smith, Jr.

Director

Delta Air Lines, Inc.

POWER OF ATTORNEY

I hereby constitute and appoint Leo F. Mullin, M. Michele Burns and James M. Whitehurst, and each of them separately, my true and lawful attorneys-in-fact, with full power of substitution, for me and in my name, in any and all capacities, to sign one or more registration statements on Form S-3 in such form as said attorneys deem appropriate or advisable, to be filed with the Securities and Exchange Commission by Delta Air Lines, Inc. (the “Company”) in respect of the issuance of up to $350,000,000 aggregate principal amount of 8% Convertible Senior Notes due 2023 of the Company, and all amendments to such registration statement (including post-effective amendments and any related registration statements filed pursuant to Rule 462), and to file the same with the Securities and Exchange Commission.

IN WITNESS WHEREOF, I have hereunto signed this power of attorney as of this 1st day of August, 2003.

/s/ Joan E. Spero

Director

Delta Air Lines, Inc.

POWER OF ATTORNEY

I hereby constitute and appoint Leo F. Mullin, M. Michele Burns and James M. Whitehurst, and each of them separately, my true and lawful attorneys-in-fact, with full power of substitution, for me and in my name, in any and all capacities, to sign one or more registration statements on Form S-3 in such form as said attorneys deem appropriate or advisable, to be filed with the Securities and Exchange Commission by Delta Air Lines, Inc. (the “Company”) in respect of the issuance of up to $350,000,000 aggregate principal amount of 8% Convertible Senior Notes due 2023 of the Company, and all amendments to such registration statement (including post-effective amendments and any related registration statements filed pursuant to Rule 462), and to file the same with the Securities and Exchange Commission.

IN WITNESS WHEREOF, I have hereunto signed this power of attorney as of this 1st day of August, 2003.

/s/ Andrew J. Young

Director

Delta Air Lines, Inc.

EX-25.1

EXHIBIT 25.1

FORM T-1

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

STATEMENT OF ELIGIBILITY

UNDER THE TRUST INDENTURE ACT OF 1939 OF A

CORPORATION DESIGNATED TO ACT AS TRUSTEE

CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF A TRUSTEE

PURSUANT TO SECTION 305(b)(2)    ¨

THE BANK OF NEW YORK TRUST COMPANY OF FLORIDA, N.A.

(Exact name of trustee as specified in its charter)

	59-2283428
(State of incorporation if not a U.S. national bank)	(I.R.S. employer identification no.)
800 Brickell Avenue Suite 300 Miami, Florida	33131
(Address of principal executive offices)	(Zip code)

The Bank of New York Trust Company of Florida, N.A.

10161 Centurion Parkway

Jacksonville, Florida 32256

Attn: Derek Kettel

(904) 998-4716

(Name, address, and telephone number of agent for service)

Delta Air Lines, Inc.

(Exact name of obligor as specified in its charter)

Delaware	58-0218548
(State or other jurisdiction of incorporation or organization)	(I.R.S. employer identification no.)
Hartsfield Atlanta International Airport Atlanta, Georgia	30320
(Address of principal executive offices)	(Zip code)

            8.00% Convertible Senior Notes due 2023

(Title of the indenture securities)

1. General information. Furnish the following information as to the trustee:

(a) Name and address of each examining or supervising authority to which it is subject.

Name	Address
Comptroller of the Currency United States Department of the Treasury	Washington, D.C. 20219
Federal Reserve Bank	Atlanta, Georgia 30309
Federal Deposit Insurance Corporation	Washington, D.C. 20429

(b) Whether it is authorized to exercise corporate trust powers.

Yes.

2. Affiliations with Obligor.

If the obligor is an affiliate of the trustee, describe each such affiliation.

None.

16. List of Exhibits.

Exhibits identified in parentheses below, on file with the Commission, are incorporated herein by reference as an exhibit hereto, pursuant to Rule 7a-29 under the Trust Indenture Act of 1939 (the “Act”) and 17 C.F.R. 229.10(d).

1. A copy of the articles of association of The Bank of New York Trust Company of Florida, N.A. (Exhibit 1 to Form T-1 filed with Registration Statement No. 333-100717).

2. A copy of certificate of authority of the trustee to commence business. (Exhibit 2 to Form T-1 filed with Registration Statement No. 333-100717).

3. A copy of the authorization of the trustee to exercise corporate trust powers. (Exhibit 3 to Form T-1 filed with Registration Statement No. 333-100717).

4. A copy of the existing by-laws of the trustee. (Exhibit 4 to Form T-1 filed with Registration Statement No. 333-100717).

5. The consent of the trustee required by Section 321(b) of the Act.

6. A copy of the latest report of condition of the Trustee published pursuant to law or to the requirements of its supervising or examining authority.

2

SIGNATURE

Pursuant to the requirements of the Act, the trustee, The Bank of New York Trust Company of Florida, N.A., a corporation organized and existing under the laws of the United States of America, has duly caused this statement of eligibility to be signed on its behalf by the undersigned, thereunto duly authorized, all in The City of Jacksonville, and State of Florida, on the 22^nd day of August, 2003.

THE BANK OF NEW YORK TRUST COMPANY OF FLORIDA, N.A.
By:	/S/ Derek Kettel
Name:	Derek Kettel
Title:	Vice President

3

EXHIBIT 5

CONSENT OF THE TRUSTEE

Pursuant to the requirements of Section 321(b) of the Trust Indenture Act of 1939, The Bank of New York Trust Company of Florida, N.A., hereby consents that reports of examinations by Federal, State, Territorial or District authorities may be furnished by such authorities to the Securities and Exchange Commission upon request therefor.

THE BANK OF NEW YORK TRUST COMPANY OF FLORIDA, N.A.
By:	/S/ Derek Kettel
	Name: Derek Kettel
	Title:   Vice President

Jacksonville, Florida

August 22, 2003

4

EXHIBIT 6

Consolidated Report of Condition of

THE BANK OF NEW YORK TRUST COMPANY OF FLORIDA, N.A.

of 800 Brickell Avenue, Suite 300, Miami, FL 33131

At the close of business March 31, 2003, published in accordance with Federal regulatory authority instructions.

	Dollar Amounts in Thousands
ASSETS
Cash and balances due from depository institutions:
Noninterest-bearing balances and currency and coin	$	2,553
Interest-bearing balances		7,097
Securities:
Held-to-maturity securities		0
Available-for-sale securities		8,618
Federal funds sold and securities purchased under agreements to resell:
Federal funds sold in domestic offices		0
Securities purchased under agreements to resell		0
Loans and lease financing receivables:
Loans and leases held for sale		0
Loans and leases, net of unearned income		0
LESS: Allowance for loan and lease losses		0
Loans and leases, net of unearned income and allowance and reserve		0
Trading assets		0
Premises and fixed assets (including capitalized leases)		1,437
Other real estate owned		0
Investments in unconsolidated subsidiaries and associated companies		0
Customers’ liability to this bank on acceptances outstanding		0
Intangible assets
Goodwill		14,182
Other Intangible Assets		108
Other assets		1,106
Total assets	$	35,101

5

LIABILITIES
Deposits:
In domestic offices	$	0
Noninterest-bearing		0
Interest-bearing		0
Federal funds purchased and securities sold under agreements to repurchase:
Federal funds purchased in domestic offices		0
Securities sold under agreements to repurchase		0
Trading liabilities		0
Other borrowed money:
(includes mortgage indebtedness and obligations under capitalized leases)		6,000
Bank’s liability on acceptances executed and outstanding		0
Subordinated notes and debentures		0
Other liabilities		3,062
Total liabilities		9,062
Minority interest in consolidated subsidiaries		0
EQUITY CAPITAL
Common stock		750
Surplus		4,299
Retained earnings		20,988
Accumulated other comprehensive income		2
Other equity capital components		0
Total equity capital		26,039
Total liabilities and equity capital	$	35,101

I, Thomas J. Mastro, Comptroller of the above-named bank do hereby declare that this Report of Condition has been prepared in conformance with the instructions issued by the appropriate Federal regulatory authority and is true to the best of my knowledge and belief.

Thomas J. Mastro	)            Comptroller
We, the undersigned directors, attest to the correctness of this Report of Condition and declare that it has been examined by us and to the best of our knowledge and belief has been prepared in conformance with the instructions issued by the appropriate Federal regulatory authority and is true and correct.
Richard G. Jackson	)
Nicholas C. English	)            Directors
Karen B. Shupenko	)

6