Delta is getting ever closer to confirmation of its bankruptcy plan of reorganization and emergence from bankruptcy. Delta has now sent retiree creditors a withholding notice explaining the mechanics of how Delta will be withholding a portion of what is distributed under its confirmed plan for taxes. A copy of Delta's letter of explanation (the "Withholding Letter") is here and their withholding notice is here.

How you will be paid and the mechanics of the withholding depends on the size of your claim for lost retiree benefits in the bankruptcy. In general, for non-pilot retirees, almost all of the claims fit into the following two classes under Delta's reorganization plan: (1) if your claim is for $2000 or less, you have a Class 6 Convenience Class Claim that will be paid in cash. (2) If your claim is more than $2000, but is $100,000 or less, you have a Class 5 Non-Convenience Class Retiree Claim. With a Class 5 claim, your ballot included an election where you could choose (A) to be paid in stock of the reorganized Delta, or (B) if Delta is able to sell that stock, instead to be paid the cash Delta obtained in selling the stock.

(There is also a separate class for claims over $100,000, Class 4. Holders of Class 4 claims are paid in Delta stock, with no ability to choose cash instead.)

What follows are some answers to frequently asked questions about payment of retiree claims and Delta's withholding of taxes:

Q: How much will Delta withhold for taxes from my claim distribution?

A: Delta is finalizing those numbers now, after consulting with the IRS. The current plan is to withhold:

• " 10% of the amount of the distribution, for Class 6 claims that were $2000 or less
• " 15% of the amount of the distribution, for Class 5 claims that were more than $2000, but less than or equal to $100,000.
• " 25% of the amount of the distribution, for Class 4 claims that are over $100,000.

Q: My claim is over $2000, but less than $100,000. I had the option to either get cash or stock, but decided I wanted Delta stock. How will Delta "withhold" part of my stock?

A: As explained in Delta's Withholding Letter here if you do nothing, Delta will sell a portion of the stock you would otherwise get to pay the 15% withholding tax. You can instead send a cashier's check, certified check, or money order to Delta as described in the letter to pay the withholding. If you do that, then Delta will not sell any of your stock to pay withholding taxes.

Q: Why would I want to send Delta a check to pay the withholding? They're supposed to pay me for my bankruptcy claim.

A: That is your decision. You might want to have as much Delta stock as possible. Or you might believe, for example, that the stock will be worth more money in the future and the price when sold by Delta to pay taxes was at a low point because of the requirement to sell those shares. In making your decision to hold as much Delta stock as possible, though, you may wish to consider, as a Delta retiree, that your health benefits, pension, and flight benefits are already dependant in part on Delta's future success, and that it might be prudent to diversify and invest your retirement savings elsewhere.

Q: If I am getting stock, how will I get my stock? Does Delta just send me stock certificates in the mail?

A: Actual share certificates are very rarely sent to investors in public companies. As Delta explains in the withholding letter, it is setting up an account for you with Fidelity Investments® ("Fidelity"). Your shares will be in that account, and you can direct Fidelity to sell or transfer your shares.

Q: I elected to be paid in cash, and my husband (also a Delta retiree) has a claim for less than $2000, so he is supposed to get cash. Are we going to have stock sold out of brokerage accounts set up for us and end up having to deal with Fidelity to get our money?

A: No. For retirees who are to be paid in cash (assuming, as expected, that Delta can sell the shares of Class 5 claimants) you will simply get a check from Delta for the amount after deduction of the withholding percentage.

Q: My claim is for less than $2000, but I want stock instead of cash. Can I get stock instead?

A: No. You have a Class 6 claim, and the plan of reorganization provides that you get cash. If you wish to buy Delta stock, you may do so after confirmation when it becomes listed and traded like other public companies.

Q: My claim is for over $100,000, but I want cash instead of stock. Can I get cash for the first $100,000 and stock for the rest?

A: No. If your claim is for more than $100,000, you do not have a Class 5 claim, and you cannot elect to be paid in cash. You will be paid in Delta stock. Once you have the stock, however, you can instruct Fidelity to sell it and to send you a check for the proceeds.