SUMMARY

This summary highlights selected information contained elsewhere in this document and may not contain all the information that is important to you. Delta and Northwest urge you to read carefully the remainder of this document, including the attached appendices, and the other documents to which we have referred you because this section does not provide all the information that might be important to you with respect to the merger and the other matters being considered at the applicable stockholders’ meeting. See also the section entitled “Where You Can Find More Information” beginning on page 166. We have included page references to direct you to a more complete description of the topics presented in this summary.

 The Merger

A copy of the merger agreement is attached as Appendix A to this document. Delta and Northwest encourage you to read the entire merger agreement carefully because it is the principal document governing the merger. For more information on the merger agreement, see the section entitled “The Merger Agreement” beginning on page 67.

 Form of Merger (See page 35)

Subject to the terms and conditions of the merger agreement, at the effective time of the merger, Nautilus Merger Corporation, a direct, wholly-owned subsidiary of Delta formed for the purposes of the merger, will be merged with and into Northwest. As a result, Northwest will become a direct, wholly-owned subsidiary of Delta. References in this document to the combined company are to Delta following the completion of the merger.

 Consideration to be Received in the Merger (See page 35)

Northwest stockholders will have the right to receive 1.25 shares of Delta common stock for each share of Northwest common stock they hold. The exchange ratio is fixed and will not be adjusted for changes in the market value of the common stock of Northwest or Delta. Because of this, the implied value of the consideration to Northwest stockholders will fluctuate between now and the completion of the merger. Based on the closing price of Delta common stock on the NYSE, on April 14, 2008, the last trading day before public announcement of the merger, the 1.25 exchange ratio represented approximately $13.10 in value for each share of Northwest common stock. Based on the closing price of Delta common stock on the NYSE on             , 2008, the latest practicable date before the date of this document, the 1.25 exchange ratio represented approximately $            .    in value for each share of Northwest common stock.

 Material U.S. Federal Income Tax Consequences of the Merger (See page 92)

The merger has been structured to qualify as a reorganization under Section 368(a) of the Internal Revenue Code of 1986, as amended, which we refer to as the Code. Assuming the merger qualifies as such a reorganization, holders of Northwest common stock whose shares of Northwest common stock are exchanged in the merger for shares of Delta common stock will not recognize gain or loss for U.S. federal income tax purposes, except with respect to any cash received in lieu of fractional shares of Delta common stock. It is a condition to the completion of the merger that Delta and Northwest receive written opinions from their respective counsel to the effect that the merger will qualify as a reorganization under Section 368(a) of the Code. Neither Delta nor Northwest intends to waive this closing condition. In the event that either Delta or Northwest waives receipt of such opinion from its counsel, however, Delta and Northwest will resolicit the approval of its stockholders after providing appropriate disclosure.

 

Tax matters are very complicated, and the tax consequences of the merger to each Northwest stockholder will depend on such stockholder’s particular facts and circumstances. Northwest stockholders should consult their tax advisors to understand fully the tax consequences to them of the merger.

 Recommendations of the Boards of Directors

Delta (See page 39)

After careful consideration, the Delta board of directors unanimously approved the merger agreement and the amendment to the Delta 2007 Performance Compensation Plan. For the factors considered by the Delta board of directors in reaching its decision to approve the merger agreement, see the section entitled “The Merger—Delta’s Reasons for the Merger; Recommendation of the Stock Issuance of Delta Common Stock in the Merger and the Amendment to the Delta 2007 Performance Compensation Plan by the Delta Board of Directors” beginning on page 39. The Delta board of directors unanimously recommends that Delta stockholders vote “FOR” the proposal to approve the issuance of Delta common stock in the merger and “FOR” the proposal to amend the Delta 2007 Performance Compensation Plan at the Delta special meeting.

Northwest (See page 48)

After careful consideration, the Northwest board of directors unanimously approved and adopted the merger agreement. For the factors considered by the Northwest board of directors in reaching its decision to approve and adopt the merger agreement, see the section entitled “The Merger—Northwest’s Reasons for the Merger; Recommendation of the Merger by the Northwest Board of Directors” beginning on page 48. The Northwest board of directors unanimously recommends that Northwest stockholders vote “FOR” the proposal to adopt the merger agreement and “FOR” the other Northwest proposals described in this joint proxy statement/prospectus at the Northwest annual meeting.

 Opinions of Financial Advisors

Delta (See page 41)

The Delta board of directors received oral opinions, subsequently confirmed in writing, from Greenhill & Co., LLC, who we refer to as Greenhill, and Merrill Lynch, Pierce, Fenner & Smith Incorporated, who we refer to as Merrill Lynch, that based upon and subject to the various considerations and assumptions described in the written opinions, the exchange ratio to be paid by Delta in the merger was fair from a financial point of view to Delta.

The full text of the written opinions of Greenhill and Merrill Lynch, each dated April 14, 2008, which set forth, among other things, the assumptions made, procedures followed, matters considered and limits on the opinions and the review undertaken in connection with rendering the opinions, are attached as Appendix C and D, respectively, to this joint proxy statement/prospectus and are incorporated herein by reference. Stockholders are urged to read these opinions in their entirety, but should note that they are not a recommendation as to how Delta stockholders should vote with respect to the issuance of shares of Delta common stock pursuant to the merger or any other matter.

Northwest (See page 51)

The Northwest board of directors received an oral opinion, subsequently confirmed in writing, from Morgan Stanley & Co. Incorporated, who we refer to as Morgan Stanley, that, as of April 14, 2008, based upon and subject to the various considerations set forth in the opinion, the exchange ratio pursuant to the merger agreement was fair from a financial point of view to the holders of shares of Northwest common stock.

 

The full text of the written opinion of Morgan Stanley, dated April 14, 2008, which sets forth the assumptions made, procedures followed, matters considered and limitations on the opinion and the review undertaken in connection with rendering the opinion, is attached as Appendix E to this joint proxy statement/prospectus and is incorporated herein by reference. Northwest stockholders are urged to read the opinion in its entirety, but should note that the Morgan Stanley opinion is not a recommendation as to how Northwest stockholders should vote on, or take any action with respect to, the merger or any other matter.

 Interests of Directors and Officers in the Merger (See page 57)

Some of the members of Delta’s and Northwest’s management and the non-employee directors on their boards of directors have interests in the merger that are in addition to, or different from, the interests of Delta and Northwest stockholders generally. Some of the executive officers of Delta and Northwest have agreements with Delta or Northwest, as applicable, that provide for severance benefits if their employment is terminated under certain circumstances in connection with a change in control of Delta or Northwest. Some of Delta’s and Northwest’s compensation and benefits plans provide for payment or accelerated vesting or distribution of the rights or benefits thereunder upon a change in control of Delta or Northwest, as applicable. The merger would be a change in control under such plans. In addition, as detailed below, the board of directors of the combined company will be made up of thirteen members, consisting of (1) seven members of the Delta board of directors, (2) five members of the Northwest board of directors and (3) one representative designated by the Delta Master Executive Council, which we refer to as the Delta MEC, the governing body of the Delta unit of the Air Line Pilots Association, International, which we refer to as ALPA.

The Delta and Northwest boards of directors were aware of these interests and considered them, among other matters, in approving the merger agreement and the transactions contemplated by the merger agreement.

 Directors and Management Following the Merger (See page 63)

Board of Directors. Upon completion of the merger, the board of directors of the combined company will be made up of thirteen members, consisting of (1) seven members of the Delta board of directors (which will include Daniel A. Carp, the current chairman of the board of directors of Delta, who will serve as non-executive chairman of the board of the combined company, and Richard H. Anderson, the current chief executive officer of Delta), (2) five members of the Northwest board of directors (which will include Roy J. Bostock, the current chairman of the Northwest board of directors, who will serve as a non-executive vice chairman of the board of directors of the combined company, and Douglas M. Steenland, the current chief executive officer of Northwest) and (3) one representative designated by the Delta MEC. The Delta MEC has designated Mr. Kenneth C. Rogers, a Delta pilot who is a current member of the Delta board of directors, to serve on the board of directors of the combined company.

Executive Officers. Upon completion of the merger, Richard H. Anderson will serve as chief executive officer of the combined company and Edward H. Bastian will serve as president and chief financial officer of the combined company.

 Treatment of Northwest Stock Options and Other Equity Based Awards (See page 65)

Stock Options; Stock Appreciation Rights. At the effective time of the merger, each outstanding option to purchase shares of Northwest common stock and each stock appreciation right in respect of Northwest common stock, whether or not exercisable, will be assumed by Delta and converted into an option to purchase Delta common stock or a stock appreciation right in respect of Delta common stock subject to, and in accordance with, the same terms and conditions applicable to the corresponding Northwest stock option or stock appreciation right, except that the number of shares of Delta common stock subject to each such converted option or in respect

 

of each such converted stock appreciation right will be equal to the product, rounded down to the nearest whole number of shares of Delta common stock, of (x) the number of shares of Northwest common stock subject to the corresponding Northwest stock option or in respect of the corresponding Northwest stock appreciation right and (y) the exchange ratio. The exercise price for converted options and stock appreciation rights will equal the applicable per share exercise price for the shares of Northwest common stock divided by the exchange ratio (rounded up to the nearest whole cent). Because the merger is a change in control for purposes of the Northwest 2007 Stock Incentive Plan, each outstanding option to purchase shares of Northwest common stock and each stock appreciation right in respect of Northwest common stock will become fully vested at the effective time of the merger.

Restricted Stock Units; Restricted Shares. At the effective time of the merger, each Northwest restricted stock unit and right to receive shares of Northwest common stock or an amount in cash measured by the value of a number of shares of Northwest common stock that is outstanding immediately prior to the effective time of the merger will, subject to and in accordance with the terms of the Northwest 2007 Stock Incentive Plan, be converted into the right to receive the number of shares of Delta common stock (or an amount in respect thereof for such cash-settled awards) equal to the product of (x) the number of shares of Northwest common stock subject to each such award and (y) the exchange ratio (rounded down to the nearest whole number of shares of Delta common stock). Because the merger is a change in control for purposes of the Northwest 2007 Stock Incentive Plan, all Northwest restricted stock units and rights to receive shares of Northwest common stock or an amount in cash measured by the value of a number of shares of Northwest common stock will become fully vested at the effective time of the merger.

 Regulatory Approvals Required for the Merger (See page 64)

Delta and Northwest have each agreed to use their reasonable best efforts in order to obtain regulatory clearance required to consummate the merger. Regulatory clearance includes antitrust filings with the Antitrust Division of the U.S. Department of Justice, which we refer to as the Antitrust Division, and expiration or termination of the required waiting periods, as well as clearance under applicable merger laws of the European Commission. Specifically, under the Hart-Scott-Rodino Antitrust Improvement Act of 1976, as amended, and the rules and regulations promulgated thereunder, which we refer to as the HSR Act, the merger may not be completed until notification and report forms have been filed, and the applicable waiting period has expired or been terminated. On April 21, 2008, each of Delta and Northwest filed its notification and report form under the HSR Act. We also expect to file notices with antitrust and competition authorities in other jurisdictions. In addition, in order to complete the merger, Delta and Northwest must also receive approvals from and make filings with various federal, state and local regulatory and transportation agencies, including the U.S. Department of Transportation, which we refer to as the DOT, and Federal Aviation Administration, which we refer to as the FAA, as well as certain foreign regulatory authorities. While Delta and Northwest expect to obtain all required regulatory approvals, we cannot assure you that these regulatory approvals will be obtained or that the granting of these regulatory approvals will not involve the imposition of additional conditions on the completion of the merger, including the requirement to divest assets, or require changes to the terms of the merger agreement. These conditions or changes could result in the conditions to the merger not being satisfied.

 Expected Timing of the Merger

We currently expect to complete the merger in the fourth quarter of 2008, subject to receipt of required stockholder approvals and regulatory clearance.

 

 Conditions to Completion of the Merger (See page 69)

The obligations of Delta and Northwest to complete the merger are subject to the satisfaction of the following conditions:

 

•

adoption of the merger agreement by a majority of the outstanding shares of Northwest common stock;

 

•

approval of the issuance of shares of Delta common stock in the merger by a majority of the shares of Delta common stock present or represented and entitled to vote at the special meeting, with the holders of a majority of the shares of Delta common stock entitled to vote actually voting on the proposal;

 

•

absence of any judgment, order, injunction (whether temporary, preliminary or permanent), decree, statute, law, ordinance, rule or regulation, or other legal restraint or prohibition by a court or other governmental entity that makes illegal or prohibits the consummation of the merger or the other transactions contemplated by the merger agreement;

 

•

effectiveness of the registration statement of which this joint proxy statement/prospectus forms a part and the absence of a stop order or proceedings threatened or initiated by the SEC for that purpose;

 

•

authorization of the listing on the NYSE of the shares of Delta common stock to be issued in the merger, subject to official notice of issuance; and

 

•

the waiting period (and any extension thereof) applicable to the merger under the antitrust laws of the United States and the European Union will have expired or been terminated and all exemptive authority required to be obtained from the DOT for any de facto route transfers will have been obtained; provided, however, this condition will not be deemed satisfied if the terms of any such permits, consents, approvals, expirations or terminations of waiting periods or authorizations would, individually or in the aggregate, have a material adverse effect on Delta, Northwest or the combined company.

In addition, each of Delta’s and Northwest’s obligation to complete the merger is subject to the satisfaction or waiver of the following additional conditions:

 

•

the representations and warranties of the other party, other than the representation related to the absence of any event or occurrence having a material adverse effect on the other party since January 1, 2008, will be true and correct (without giving effect to any materiality qualifications contained in such representations and warranties) when made and at and as of the effective time of the merger (other than those representations and warranties that were made only as of a specified date, which need only be true and correct as of such specified date), provided that such representations will be deemed to be true unless the individual or aggregate impact of the failure to be so true would have or would reasonably be expected to have a material adverse effect on the other party;

 

•

the representation and warranty of the other party relating to the absence of any event or occurrence having a material adverse effect on the other party since January 1, 2008 will be true and correct when made and at and as of the effective time of the merger;

 

•

the other party will have performed, or complied with, in all material respects, all of its respective obligations under the merger agreement at or prior to the consummation of the merger;

 

•

receipt of a certificate executed by the other party’s chief executive officer and chief financial officer as to the satisfaction of the conditions described in the preceding three bullets;

 

•

receipt of a legal opinion of that party’s counsel to the effect that the merger will be treated as a “reorganization” within the meaning of Section 368(a) of the Code; and

 

•

no proceeding under any law relating to bankruptcy, insolvency or reorganization will have been instituted and not dismissed against the other party.

 

 No Solicitations by Delta or Northwest (See page 74)

Subject to exceptions, the merger agreement precludes Delta and Northwest from soliciting or engaging in discussions or negotiations with a third party with respect to a proposal for an alternative transaction, including the acquisition of a significant interest in Delta’s or Northwest’s equity or assets. Notwithstanding such restrictions, the merger agreement provides that, under specified circumstances and prior to the applicable approval by their respective stockholders, if Delta or Northwest receives an unsolicited proposal from a third party for an alternative transaction that its board of directors determines in good faith is reasonably likely to lead to a proposal that is superior to the merger, Delta or Northwest, as applicable, may furnish nonpublic information to that third party and engage in negotiations regarding an alternative transaction with that third party.

 Termination of the Merger Agreement (See page 81)

Delta and Northwest can jointly agree to terminate the merger agreement at any time. Either company may also terminate the merger agreement if the merger is not completed by April 14, 2009 (with each party being able to extend this date until October 14, 2009 under specified circumstances) or under other circumstances described in this document. See the section entitled “The Merger Agreement—Termination of the Merger Agreement” beginning on page 81 for a discussion of these and other rights of each of Delta and Northwest to terminate the merger agreement.

 Expenses and Termination Fees (See page 82)

Generally, all fees and expenses incurred in connection with the merger agreement and the transactions contemplated by the merger agreement will be paid by the party incurring those expenses, subject to the specific exceptions discussed in this document where Delta or Northwest, as the case may be, may be required to pay a termination fee of $165 million. See the section entitled “The Merger Agreement—Termination Fees and Expenses” beginning on page 82 for a discussion of the circumstances under which the termination fee will be required to be paid.

 Accounting Treatment (See page 92)

Delta prepares its financial statements in accordance with accounting principles generally accepted in the United States of America, which is referred to as GAAP. The merger will be accounted for using the purchase method of accounting.

 Appraisal Rights (See page 164)

Under Delaware law, neither the holders of Northwest common stock nor the holders of Delta common stock are entitled to appraisal rights in connection with the merger.

 Comparison of Stockholder Rights and Corporate Governance Matters (See page 109)

Northwest stockholders receiving merger consideration will have different rights once they become Delta stockholders due to differences between the governing documents of Delta and Northwest. These differences are described in detail under the section entitled “Comparison of Rights of Delta Stockholders and Northwest Stockholders” beginning on page 109.

 

 The Meetings

 The Delta Special Meeting (See page 25)

The Delta special meeting will be held at the             at     :    a.m., local time, on             , 2008. At the Delta special meeting, Delta stockholders will be asked to:

 

•

approve the issuance of Delta common stock in the merger;

 

•

approve the amendment to the Delta 2007 Performance Compensation Plan; and

 

•

to vote upon an adjournment of the Delta special meeting, if necessary or appropriate, to solicit additional proxies if there are not sufficient votes to approve the foregoing proposals.

You may vote at the Delta special meeting if you owned shares of Delta common stock at the close of business on             , 2008. On that date there were             shares of Delta common stock outstanding and entitled to vote at the Delta special meeting, less than     % of which were owned and entitled to be voted by Delta directors and executive officers and their affiliates. We currently expect that Delta’s directors and executive officers will vote their shares in favor of both the merger and the amendment to the Delta 2007 Performance Compensation Plan, although none of them have entered into any agreements obligating them to do so.

You can cast one vote for each share of Delta common stock you own. Each of the proposals to be considered at the Delta special meeting requires the affirmative vote of holders of a majority of the shares of Delta common stock present or represented and entitled to vote on the proposal. In addition, under NYSE rules, the total votes cast on each proposal must represent a majority of the shares of Delta common stock entitled to vote on the proposal.

 The Northwest Annual Meeting (See page 29)

The Northwest annual meeting will be held at the                     at    :    a.m., local time, on             , 2008. At the Northwest annual meeting, Northwest stockholders will be asked to:

 

•

adopt the merger agreement;

 

•

elect twelve directors to hold office until the 2009 Annual Meeting of Stockholders and until their respective successors have been elected and qualified, or if the merger is completed, until the effective time of the merger;

 

•

ratify the appointment of Ernst & Young LLP as Northwest’s independent registered public accounting firm for the fiscal year ending December 31, 2008;

 

•

approve an amendment to the Northwest 2007 Stock Incentive Plan;

 

•

vote upon an adjournment of the Northwest annual meeting, if necessary or appropriate, to solicit additional proxies if there are not sufficient votes to approve each of the foregoing proposals; and

 

•

transact such other business as may properly come before the Northwest annual meeting or any adjournment or postponement thereof.

You may vote at the Northwest annual meeting if you owned shares of Northwest common stock at the close of business on             , 2008. On that date there were             shares of Northwest common stock outstanding and entitled to vote at the Northwest annual meeting, less than     % of which were owned and entitled to be voted by Northwest directors and executive officers and their affiliates. We currently expect that Northwest’s directors and executive officers will vote their shares in favor of the merger and the other Northwest proposals described in this joint proxy statement/prospectus, although none of them have entered into any agreements obligating them to do so.

 

You can cast one vote for each share of Northwest common stock you own. Each of the proposals to be considered at the Northwest annual meeting requires certain percentages of votes in order to approve them:

 

•

Adoption of the merger agreement requires the affirmative vote of holders of a majority of the outstanding shares of Northwest common stock entitled to vote on the proposal.

 

•

The twelve nominees for election to the Northwest board of directors receiving the greatest number of affirmative votes cast by holders of Northwest common stock will be elected as directors.

 

•

Ratification of the appointment of Ernst & Young LLP as Northwest’s independent registered public accounting firm for the fiscal year ending December 31, 2008 requires the affirmative vote of a majority of the votes cast on the proposal at the Northwest annual meeting.

 

•

Approval of the amendment to the Northwest 2007 Stock Incentive Plan requires the affirmative vote of a majority of the votes cast on the proposal at the Northwest annual meeting, provided that a majority of the outstanding shares of Northwest common stock entitled to vote are voted on the proposal.

 

•

Adjournment of the Northwest annual meeting, if necessary or appropriate, to solicit additional proxies if there are not sufficient votes to approve each of the foregoing proposals, requires the affirmative vote of a majority of the votes cast on the proposal at the Northwest annual meeting.

 

 The Companies

 Delta (See page 34)

Delta Air Lines, Inc.

1040 Delta Boulevard

Atlanta, Georgia 30354

Telephone: (404) 715-2600

Delta Air Lines, Inc. is a major air carrier that provides scheduled air transportation for passengers and cargo throughout the United States and around the world. Delta offered customers service to more destinations than any other global airline, with Delta and Delta Connection carrier service to 305 destinations in 58 countries in May 2008. Delta has added more international capacity than any other major U.S. airline during the last two years and is the leader across the Atlantic with flights to 38 trans-Atlantic markets. To Latin America and the Caribbean, Delta offered more than 478 weekly flights to 58 destinations in May 2008. Delta is a founding member of SkyTeam, a global airline alliance that provides customers with extensive worldwide destinations, flights and services. Delta and Air France recently implemented a joint venture to share revenues and costs on transatlantic routes that is expected to increase customer travel choices on key routes across the Atlantic. Including its SkyTeam and worldwide codeshare partners, Delta offered flights to 474 worldwide destinations in 104 countries in May 2008.

Delta is a Delaware corporation headquartered in Atlanta, Georgia. Delta’s website is www.delta.com. Delta has provided this website address as an inactive textual reference only and the information contained on Delta’s website is not a part of this joint proxy statement/prospectus.

 Northwest (See page 34)

Northwest Airlines Corporation

2700 Lone Oak Parkway

Eagan, Minnesota 55121

(612) 726-2111

Northwest Airlines, Inc., the wholly-owned subsidiary of Northwest Airlines Corporation, operates the world’s sixth largest airline, as measured by 2006 revenue passenger miles, and is engaged in the business of transporting passengers and cargo. Northwest began operations in 1926. Northwest Airlines, Inc.’s business focuses on the operation of a global airline network through its strategic assets that include: (1) domestic hubs at Detroit, Minneapolis/St. Paul and Memphis, (2) an extensive Pacific route system with a hub in Tokyo, (3) a transatlantic joint venture with KLM Royal Dutch Airlines, which operates through a hub in Amsterdam, (4) a domestic and international alliance with Continental Airlines, Inc. and Delta, (5) membership in SkyTeam, a global airline alliance with KLM, Continental, Delta, Air France, Alitalia, Aeroméxico, CSA Czech Airlines, Korean Air and Aeroflot, (6) agreements with three domestic regional carriers, including Pinnacle Airlines, Inc., Mesaba Aviation, Inc., a wholly-owned subsidiary, and Compass Airlines, Inc., a wholly-owned subsidiary, each of which operates as Northwest Airlink and (7) a cargo business that operates a dedicated freighter fleet of aircraft through hubs in Anchorage and Tokyo.

Northwest is a Delaware corporation headquartered in Eagan, Minnesota. Northwest’s website is www.nwa.com. Northwest has provided this website address as an inactive textual reference only and the information contained on Northwest’s website is not a part of this joint proxy statement/prospectus.

 

 SELECTED HISTORICAL AND PRO FORMA COMBINED FINANCIAL DATA

 Selected Consolidated Historical Financial Data of Delta

The following statements of operations data for the eight months ended December 31, 2007, the four months ended April 30, 2007 and the years ended December 31, 2006 and 2005 and the balance sheet data as of December 31, 2007 and 2006 have been derived from the audited consolidated financial statements of Delta contained in its Annual Report on Form 10-K for the fiscal year ended December 31, 2007, which is incorporated into this document by reference. The statements of operations data for the years ended December 31, 2004 and 2003 and the balance sheet data as of December 31, 2005, 2004 and 2003 have been derived from Delta’s audited consolidated financial statements for such years, which have not been incorporated into this document by reference.

The statements of operations data for the three months ended March 31, 2008 and 2007 and the balance sheet data as of March 31, 2008 have been derived from Delta’s unaudited consolidated financial statements, which are incorporated into this document by reference. The balance sheet data as of March 31, 2007 have been derived from Delta’s unaudited consolidated financial statements, which have not been incorporated into this document by reference.

You should read this selected historical financial data together with the financial statements that are incorporated by reference into this document and their accompanying notes and management’s discussion and analysis of operations and financial condition of Delta contained in such reports.

Upon emergence from Chapter 11, Delta adopted fresh start reporting in accordance with American Institute of Certified Public Accountants’ Statement of Position 90-7, “Financial Reporting by Entities in Reorganization under the Bankruptcy Code,” which we refer to as SOP 90-7. The adoption of fresh start reporting resulted in Delta becoming a new entity for financial reporting purposes. Accordingly, Delta’s Consolidated Financial Statements on or after May 1, 2007 are not comparable to Delta’s Consolidated Financial Statements prior to that date.

Due to Delta’s adoption of fresh start reporting on April 30, 2007, the following table includes selected summary financial data for (1) the three months ended March 31, 2008 and the eight months ended December 31, 2007 of the successor entity and (2) the four months ended April 30, 2007, the three months ended March 31, 2007 and the years ended December 31, 2006, 2005, 2004 and 2003 of the predecessor entity.

 

Summary of Operations Data

 

		Successor				Predecessor				Successor				Predecessor
		Three Months Ended March 31,								Eight Months Ended December 31, 2007(2)				Four Months Ended April 30, 2007(3)
(in millions, except per share data)																		Year Ended December 31,
		2008(1)				2007												2006(4)(10)				2005(5)(10)				2004(6)				2003(7)
Operating revenue		$	4,766			$	4,241			$	13,358			$	5,796			$	17,532			$	16,480			$	15,235			$	14,308
Operating expense			11,027				4,086				12,562				5,496				17,474				18,481				18,543				15,093
Operating (loss) income			(6,261	)			155				796				300				58				(2,001	)			(3,308	)			(785	)
Interest expense, net(8)			(120	)			(190	)			(276	)			(248	)			(801	)			(973	)			(787	)			(721	)
Miscellaneous, net(9)			(9	)			29				5				27				(19	)			(1	)			94				317
Gain on extinguishment of debt, net			—				—				—				—				—				—				9				—
(Loss) income before reorganization items, net			(6,390	)			(6	)			525				79				(762	)			(2,975	)			(3,992	)			(1,189	)
Reorganization items, net			—				(124	)			—				1,215				(6,206	)			(884	)			—				—
(Loss) income before income taxes			(6,390	)			(130	)			525				1,294				(6,968	)			(3,859	)			(3,992	)			(1,189	)
Income tax (provision) benefit			—				—				(211	)			4				765				41				(1,206	)			416
Net (loss) income			(6,390	)			(130	)			314				1,298				(6,203	)			(3,818	)			(5,198	)			(773	)
Preferred stock dividends			—				—				—				—				(2	)			(18	)			(19	)			(17	)
Net (loss) income attributable to common shareowners			(6,390	)			(130	)			314				1,298				(6,205	)			(3,836	)			(5,217	)			(790	)
Basic (loss) earnings per share		$	(16.15	)		$	(0.66	)		$	0.80			$	6.58			$	(31.58	)		$	(23.75	)		$	(41.07	)		$	(6.40	)
Diluted (loss) earnings per share		$	(16.15	)		$	(0.66	)		$	0.79			$	4.63			$	(31.58	)		$	(23.75	)		$	(41.07	)		$	(6.40	)
Dividends declared per common share		$	—			$	—			$	—			$	—			$	—			$	—			$	—			$	0.05

 

Other Financial Data

 

		Successor			Predecessor				Successor			Predecessor
		March 31,							December 31,			December 31,
		2008(1)			2007				2007(2)			2006(4)(10)				2005(5)(10)				2004(6)				2003(7)
Cash, cash equivalents and short-term investments		$	2,595		$	2,883			$	2,786		$	2,648			$	2,008			$	1,799			$	2,710
Total assets (millions)		$	26,755		$	19,811			$	32,423		$	19,622			$	20,039			$	21,801			$	25,939
Long-term debt and capital leases (excluding current maturities) (millions)		$	8,387		$	4,792			$	7,986		$	6,509			$	6,557			$	13,005			$	11,538
Shareowners’ equity (deficit) (millions)		$	3,951		$	(13,676	)		$	10,113		$	(13,593	)		$	(9,895	)		$	(5,796	)		$	(659	)
Common stock outstanding			292,169,861			197,335,938				292,225,696			197,335,938				189,343,018				139,830,443				123,544,945
Full-time equivalent employees, end of period			55,382			52,260				55,044			51,322				55,650				69,148				70,600

 

(1)	Includes a $6.1 billion non-cash charge or $15.42 diluted loss per share for goodwill impairment (see Delta’s March 31, 2008 Form 10-Q).

(2)	Includes a $211 million income tax provision or $0.53 diluted loss per share (see “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Delta’s 2007 Form 10-K).

(3)

Includes a $1.2 billion non-cash gain or $5.20 diluted earnings per share for reorganization items; and a $4 million income tax benefit or $0.02 diluted earnings per share (see “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Delta’s 2007 Form 10-K).

(4)

Includes a $6.2 billion non-cash charge or $31.58 diluted loss per share for reorganization items; a $310 million non-cash charge or $1.58 diluted loss per share associated with certain accounting adjustments; and a $765 million income tax benefit or $3.89 diluted earnings per share (see “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Delta’s 2007 Form 10-K).

(5)

Includes an $888 million charge or $5.49 diluted loss per share for restructuring, asset writedowns, pension settlements and related items, net and an $884 million non-cash charge or $5.47 diluted loss per share for reorganization items (see “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Delta’s 2007 Form 10-K).

(6)

Includes a $1.9 billion charge or $14.76 diluted loss per share related to the impairment of intangible assets; a $1.2 billion charge or $9.51 diluted loss per share for deferred income tax valuation; a $123 million gain, or $0.97 diluted earnings per share from the sale of investments; and a $41 million gain or $0.33 diluted earnings per share from restructuring, asset writedowns, pension settlements and related items, net.

(7)

Includes a $268 million charge ($169 million net of tax, or $1.37 diluted loss per share) for restructuring, asset writedowns, pension settlements and related items, net; a $398 million gain ($251 million net of tax, or $2.03 diluted earnings per share) for compensation received under the Emergency Wartime Supplemental Appropriations Act; and a $304 million gain ($191 million net of tax, or $1.55 diluted earnings per share) for certain other income and expense items.

(8)	Includes interest income.

(9)	Includes (losses) gains from the sale of investments and fair value adjustments of derivatives.

(10)

The 2006 and 2005 Consolidated Summary of Operations and Financial and Statistical Data above have been updated to conform to current period presentation for certain reclassifications made upon emergence from bankruptcy (see Note 2 of the Notes to the Consolidated Financial Statements in Delta’s 2007 Form 10-K).

 

 Selected Consolidated Historical Financial Data of Northwest

The following statements of operations data for the seven months ended December 31, 2007, the five months ended May 31, 2007 and the years ended December 31, 2006 and 2005 and the balance sheet data as of December 31, 2007 and 2006 have been derived from Northwest’s audited consolidated financial statements contained in its Annual Report on Form 10-K for the fiscal year ended December 31, 2007, which is incorporated into this document by reference. The statements of operations data for the years ended December 31, 2004 and 2003 and the balance sheet data as of December 31, 2005, 2004 and 2003 have been derived from Northwest’s audited consolidated financial statements for such years, which have not been incorporated into this document by reference.

The statements of operations data for each of the three months ended March 31, 2008 and 2007 and the balance sheet data as of March 31, 2008 have been derived from Northwest’s unaudited consolidated financial statements, which are incorporated into this document by reference. The balance sheet data as of March 31, 2007 have been derived from Northwest’s unaudited consolidated financial statements, which have not been incorporated into this document by reference.

You should read this selected historical financial data together with the financial statements that are incorporated by reference into this document and their accompanying notes and management’s discussion and analysis of operations and financial condition of Northwest contained in such reports.

Upon emergence from Chapter 11, Northwest adopted fresh start reporting in accordance with SOP 90-7. The adoption of fresh start reporting resulted in Northwest becoming a new entity for financial reporting purposes. Accordingly, Northwest’s Consolidated Financial Statements on or after June 1, 2007 are not comparable to Northwest’s Consolidated Financial Statements prior to that date.

Due to Northwest’s adoption of fresh start reporting on May 31, 2007, the following table includes selected summary financial data for (1) the three months ended March 31, 2008 and the seven months ended December 31, 2007 of the successor entity and (2) the five months ended May 31, 2007, the three months ended March 31, 2007 and the years ended December 31, 2006, 2005, 2004 and 2003 of the predecessor entity.

 

Summary of Operations Data

 

		Successor				Predecessor				Successor				Predecessor
										Seven Months Ended December 31, 2007				Five Months Ended May 31, 2007
(in millions, except per share data)		Three Months Ended March 31,
																		Year Ended December 31,
		2008(1)				2007												2006				2005				2004				2003
Operating revenues
Passenger		$	2,239			$	2,202			$	5,660			$	3,768			$	9,230			$	8,902			$	8,432			$	7,632
Regional carrier			410				292				884				521				1,399				1,335				1,083				860
Cargo			198				189				522				318				946				947				830				752
Other			280				190				538				317				993				1,102				934				833
Total operating revenues			3,127				2,873				7,604				4,924				12,568				12,286				11,279				10,077
Operating expenses			7,180				2,672				6,863				4,561				11,828				13,205				11,784				10,342
Operating (loss) income			(4,053	)			201				741				363				740				(919	)			(505	)			(265	)
Operating margin			-129.6	%			7.0	%			9.7	%			7.4	%			5.9	%			-7.5	%			-4.5	%			-2.6	%
Net (loss) income before cumulative effect of accounting change			(4,139	)			(292	)			342				1,751				(2,835	)			(2,464	)			(862	)			248
Cumulative effect of accounting change			—				—				—				—				—				(69	)			—				—
Net (loss) income			(4,139	)			(292	)			342				1,751				(2,835	)			(2,533	)			(862	)			248
(Loss) earnings per common share:
Basic		$	(15.78	)		$	(3.34	)		$	1.30			$	20.03			$	(32.48	)		$	(29.36	)		$	(10.32	)		$	2.75
Diluted		$	(15.78	)		$	(3.34	)		$	1.30			$	14.28			$	(32.48	)		$	(29.36	)		$	(10.32	)		$	2.62

Other Financial Data

 

		Successor			Predecessor				Successor			Predecessor
		March 31,							December 31, 2007			December 31,
(in millions)		2008			2007							2006				2005				2004				2003
Cash, cash equivalents and unrestricted short-term investments		$	3,227		$	2,426			$	3,034		$	2,058			$	1,262			$	2,459			$	2,757
Total assets			21,032			13,742				24,517			13,215				13,083				14,042				14,008
Long-term debt, including current maturities			7,123			4,456				6,961			4,112				1,159				8,411				7,866
Long-term obligations under capital leases, including current obligations			125			—				127			—				11				361				419
Long-term pension and postretirement health care benefits, including current obligations			3,727			90				3,720			185				264				4,095				3,756
Liabilities subject to compromise			—			13,633				—			13,572				14,328				—				—
Preferred redeemable stock subject to compromise			—			275				—			277				280				263				236
Common stockholders’ equity (deficit)			3,286			(8,280	)			7,377			(7,991	)			(5,628	)			(3,087	)			(2,011	)

 

(1)	Includes a $3.9 billion non-cash charge or $14.94 diluted loss per share for goodwill impairment (see Northwest’s March 31, 2008 Form 10-Q).