Delta Airlines 2003 Annual Report Download - page 91

Table of Contents
Series B Preferred Stock; (2) sold 3.9 million shares of priceline common stock; and (3) received 695,749 shares of priceline common stock as dividends on
the Series B Preferred Stock. In our 2002 Consolidated Statement of Operations, we recognized (1) a pretax loss of $3 million from the exercise of the 2001
Warrant and the sale of priceline common stock and (2) other income of $2 million, pretax, from the dividends.
2003
On June 16, 2003, priceline effected a 1-for-6 reverse common stock split. As a result of the stock split:
• The 1999 Warrant, as amended, was adjusted to (1) reduce from 4.7 million to approximately 779,000 the maximum number of shares we may purchase
by exercising that warrant and (2) increase from $4.72 to $28.31 the per share purchase price of those shares.
• The 2001 Warrant was adjusted to (1) reduce from 4.5 million to approximately 756,000 the maximum number of remaining shares we may purchase by
exercising that warrant; (2) increase from $2.97 to $17.81 the per share purchase price of those shares; and (3) increase from $8.91 to $53.46 the closing
sales price which priceline common stock must exceed for 20 consecutive days for the 2001 Warrant to automatically be deemed exercised.
• The Series B Preferred Stock was adjusted to reduce its annual per share dividend from approximately 36 shares to six shares of priceline common stock.
The reverse stock split did not impact the carrying value of our equity interests in priceline.
During 2003, as adjusted for priceline's 1-for-6 reverse common stock split, we (1) sold 423,640 shares of priceline common stock and (2) received 80,480
shares of priceline common stock. In our 2003 Consolidated Statements of Operations, we recognized (1) a pretax gain of $5 million from the sale of priceline
common stock; (2) other income of $1 million, pretax, from the dividends; and (3) an $8 million writedown related to our priceline common stock due to an
other than temporary decline in the fair value of that stock.
The following table represents our equity interests in priceline and their respective carrying values at December 31, 2003 and 2002, as adjusted for the 1-for-6
reverse common stock split discussed above:
Number of Shares(2) Carrying Values
(in millions)(1) 2003 2002 2003 2002
Series B Preferred Stock 13,469 13,469 $ 13 $ 13
2001 Warrant 0.8 0.8 7 3
1999 Warrant 0.8 0.8 3 —
priceline common stock — 0.3 — 3
(1) Except shares of Series B Preferred Stock.
(2) We have certain registration rights relating to shares of priceline common stock we acquire from the exercise of the 1999 Warrant or the 2001
Warrant, or receive as dividends on the Series B Preferred Stock. F-21