Delta Air Lines Inc., the third largest U.S. carrier, said its unsecured creditors approved the revised terms of a $2.5 billion loan package designed to finance its exit from bankruptcy and strengthen its finances.
The five-year loan agreement consists of a $1 billion credit line and two term loans, one of $500 million and one of $1 billion, the airline said in a filing Friday in bankruptcy court in New York.
The loan package from a group of banks led by JPMorgan Chase & Co., Goldman, Sachs & Co. and Merrill Lynch & Co. will go toward repaying $2.1 billion of existing debt and to boost the company's cash balance, the company said in the filing.
"The revised plan," said Delta lawyer Marshall Huebner of New York's Davis Polk & Wardwell, "is another tremendous milestone for us as we move towards exiting chapter 11 under our standalone plan."
Delta, which operates a hub at Salt Lake City International Airport, filed the 10th-biggest U.S. bankruptcy by value of assets in September 2005, citing rising fuel costs and declining revenue. It listed debt of $28.3 billion and assets of $21.8 billion at the time.
Delta plans to end its bankruptcy by becoming a standalone carrier by April 30, having fought off an unsolicited merger offer from US Airways Group.
In its updated filings with the bankruptcy court Friday, Delta didn't provide information to creditors about who will sit on the board of the reorganized company or how executives will be compensated after it emerges.
The airline said it will disclose the compensation payable to board members as well as its top officers by 20 days before the deadline set for creditors to vote on its turnaround plan. Creditors may have to wait until 10 days before the voting deadline to learn the identities of the proposed new Delta board, the airline said in court papers.
Delta Chief Executive Officer Gerald Grinstein has said he will remain in his post long enough after Delta emerges from bankruptcy to allow the new board to choose another CEO.