Void stock options, Delta asks

ATLANTA — Delta Air Lines Inc., which is operating under bankruptcy protection, asked a judge Monday to allow the nation's third-largest carrier to void roughly 93 million stock options held by 70,000 current and former employees and directors.

The Atlanta-based company, which operates a hub at Salt Lake City International Airport, said the options, if exercised, would provide little to no real value, making the $305,000 a year it costs the airline to maintain, account for and administer the benefit an unnecessary burden on Delta.

The company's motion says the request has the support of the creditors committee in its bankruptcy case and the Air Line Pilots Association, the union that represents holders of roughly one-third of the options Delta is seeking to reject.

A hearing on the request is scheduled April 3 in U.S. Bankruptcy Court in New York.

Also Monday, Delta's chief financial officer, Edward Bastian, said it's possible flight bookings in April and May are being affected by a strike threat by Delta's pilots. But, while he wouldn't provide numbers, he stressed bookings are not down in any "material" way, and there's no way to tell for sure why bookings may be different from a year ago.

"I'm sure there is some influence on our customers in a marginal way," Bastian, referring to the strike threat, said in a telephone interview.

According to Delta's motion to reject its stock options, the options in question have exercise prices between $2.97 and $62.63 a share. Delta's stock has been trading in recent days at around 40 cents a share in over-the-counter trading.

"The rejection of the Delta stock options will have no practical economic effect on the option holders," the airline's motion says.

Shares of a company in bankruptcy protection generally become worthless. Delta has said it expects to emerge from Chapter 11 by the summer of 2007.

"We didn't oppose the motion to void the stock options because they were worthless once management forced the company into bankruptcy anyway," the chairman of the pilots union's executive committee, Lee Moak, said Monday.