ACA MEC Letter to Mesa BOD

[rballan]

View at www.alpa.org

 

[Av8tor]

December 4, 2003
Board of Directors
Mesa Air Group
410 North 44th Street
Suite 700
Phoenix, AZ 85008
Ladies and Gentlemen:
We are the Officers of the Master Executive Council for the pilots of Atlantic Coast
Airlines Holdings, Inc. (“ACA”), as represented by the Air Line Pilots Association
International. We are writing to you on behalf of the 1,600 pilots at ACA to clearly state
our unambiguous opposition to your announced intentions for our company.
As we have previously stated via press release and in numerous media interviews, this
pilot group and its elected leadership strongly support our current Board’s decision to
transform ACA from a regional carrier into a Dulles-based, low-fare airline to be known
as Independence Air. Subsequent to your unsolicited “expression of interest” of October
6, 2003, and with full knowledge of your announced intentions, this pilot group
overwhelmingly approved an amendment to our collective bargaining agreement to
support this transformation through wage reductions and productivity enhancements.
With 93% of our eligible pilots participating in the ratification process, and of those, 97%
voting in favor of the amended agreement, this ballot clearly demonstrates that ACA’s
pilots are absolutely unified in our commitment to working with all ACA employees to
ensure the success of Independence Air.

We take exception with the uninformed and simplistic view that the ACA pilots support
Independence Air only because it will provide an opportunity to operate larger aircraft.
Our universal desire to exit the regional fee-for-departure segment of the industry is
driven by the rational analysis that this segment of the airline industry is becoming
saturated and, in the foreseeable future, will become a low-growth, low-margin
commodity business. When competitors, with increasing frequency, promise aircraft
without definitive orders or committed long-term financing, it is time to exit the segment.

One has to question the wisdom of Mesa continuing to add a single regional jet to the
fleet, much less more than 100 aircraft, when considering the staggering off-balance sheet
long-term financial obligations for Mesa and the credit ratings of the major airlines in
your code share partner “portfolio”. Finally, the significantly higher P/E multiples in the
low-cost carrier (“LCC”) segment (or, conversely, the significantly lower P/E multiples in the regional segment) support our thesis as evidenced in the pricing and initial
performance of the recent Pinnacle Airlines (Northwest Airlink) IPO.

Let me be crystal clear: the pilots of Atlantic Coast Airlines have absolutely no interest in
being acquired by Mesa or deviating in any other way from our management’s
independent vision. We intend to fully exercise by all means available both our
contractual rights and those rights provided by the Railway Labor Act (“RLA”) to protect
our interests in the event that you proceed with this unwelcome transaction. You should
be aware of the following facts:

• In the event of a “change of control”, we retain the sole right to terminate the
conditional concessionary New United Airlines Code Share Letter of Agreement
(“UAL LOA”), which contains significant wage reductions and work rule
changes. Change in control shall mean:

(1) The acquisition of beneficial ownership or control of (including, without
limitation, power to vote) more than 50% of the outstanding shares of
Common Stock by any person or entity (including a “group” as defined by or
under Section 13(d)(3) of the Exchange Act), or

(2) A contested election of directors, as a result of which or in connection with
which, the persons who were directors of ACAI before such election or their
nominees cease to constitute a majority of the Board.

• Without the UAL LOA, our Collective Bargaining Agreement is amendable in
August 2005. It is typical for airline negotiations under Section 6 of the RLA to
continue well beyond the amendable date during which time our 2005 cost
structure, including a 4% increase from or current pay rates, will remain in place
with continued escalation for increases in longevity (generally 3% per year).

• If you are successful in the consent solicitation, you should consider your reduced
ability to implement the United MOU given the cost structure resulting from our
termination of the UAL LOA and the resulting impact on operating margins.
Should you elect to pursue a merger following a successful consent solicitation, you
should be aware that language in both of the collective bargaining agreements for the
Mesa and ACA pilot groups provides for integration of pilot seniority lists. If we are
unable to achieve a negotiated integration (very likely as we will move aggressively to
protect all of our current and future flying as well as securing access for ACA pilots to as
much of the combined company’s future growth as possible), both pilot groups will be
subject to binding arbitration, which has historically been a lengthy process.
Given all of these facts, we genuinely question how you could view this hostile
transaction as being in the interests of Mesa stakeholders, in particular your pilots who
made considerable compromises in their most recent contract to access growth and
upgrade opportunities which they would now have to share with us. I have no doubt that
this transaction is not in the best interest of ACA stakeholders and employees, and we
will fight to the bitter end to avoid becoming yet another airline (i.e. West Air and
CCAir) tossed in the Mesa graveyard.

We wish no ill will to Mesa, its officers, management, employees or shareholders. We
simply encourage you to pursue the many opportunities for internal growth that your
officers have publicly stated are available, rather than pursuing this ill-conceived, highrisk
and extremely unwelcome merger. If your true goal is to maximize shareholder
value, I would strongly recommend that Mesa cease all efforts to attain control of ACA
and allow us the simple courtesy of pursuing our own course.

Respectfully,
Captain Stephen Hunt
Chairman
ACO Master Executive Council
Air Line Pilots Association, Intl

Captain Brian Delahunty
Vice-Chairman
ACO Master Executive Council
Air Line Pilots Association, Intl

Captain Terry Fenningham
Executive Administrator
ACO Master Executive Council
Air Line Pilots Association, Intl

 

[Tooslow]

NICE! 120% for i

 

[Mallard]

In other words "kiss our collective arses"

You picked the wrong fight fat boy!

 

[Tug Driver]

A POWER PACKED PUNCH!!!!

 

[Always deferred]

He picked the wrong pilot group to go hostile on....

 

[inthepool]

The only question is this: Will JO get United's d1ck out of his mouth long enough to read the letter?

 

[jobear]

AP release--December 6,2003

John O exalted leader of Mesa Air Group today announced that he no longer has to think for himself. When asked by this reporter as to why, the strings controlling his head movement snapped of to reveal an empty hole where his brain should have been.
After futher research this reporter was able to uncover exactly what was going on. It seems Mr. John Oreinstien had his brain surgicaly removed quick frozen and placed next to Ted Williams head. Mr. Williams when realizing what was next to him in the Cryogenic Tank asked thru a John Edwards that he be taken out and covered honey and placed on a fire ant mound.

As to the strings controlling Johnny O's there where found to be A/C rigging cables and the part numbers led me to an Indinappolis, IN defunt UAL maintenace hanger. A UAL spokesperson I contacted said this "What would we want thoose lossy gates at IAD for"
Rest assured your ace reporter is on the case.

 

[dispatchguy]

OhhRah

I commend and applaud the ACA MEC in telling JohnnyO's BOD to take their offer and shove it.

I wish all of you nothing but the very best with your LCC.

 

[big dog1]

You ACA pilots(stapled to the bottom of our list) will be working for MESA soon!!!!

 

[GogglesPisano]

You ACA pilots(stapled to the bottom of our list) will be working for MESA soon!!!!

Care to enlighten us with your grasp of ALPA M&A bylaws?

If you read the press release by our MEC, you'll read that they will expend every effort to protect the interests of the ACO pilot group, including capturing any growth planned as a combined UEX carrier (read 70-seat flying.)

(By the way, even if this disaster does come to pass and we were stapled -- about as likely as a meteor strike tommorrow -- we'd still make more money and have more days have. Love ya!)

 

[big dog1]

It willl be CCair all over again.

 

[KingAirKiddo]

You ACA pilots(stapled to the bottom of our list) will be working for MESA soon!!!!

Atta boy, big dog, keep drinkin' the Ornstein Kool Aid like a good little Mesa robot.

 

[XJslave]

big dog you must be one of those loser that wears a Mesa jacket when you're not working. Just proud to be Mesa. You're the kind of person that would sell thier mother into slavery just to fly a RJ. Do those Mesa jacket come with a free knee board?

 

[VADriver]

It willl be CCair all over again.

Provide a thorough analysis and comparison of CCAirs and ACA's ALPA scope language....then relate such comparison to your statement....

Good Luck....

 

[wscrj]

Ignore him

Please ignore big dog 1. His post was ridiculous and CERTAINLY not representative of the typical Mesa pilot. If he even truly works for us, he is obviously young and pathetically uninformed.

Good luck to ACA/The big I, and good luck to us all.

 

[AirBoard]

It willl be CCair all over again.

ROTFLMFAO....You're so misguided and unimformed your nightmare hasn't even begun.

 

[Tim47SIP]

Bend Over

Do those Mesa jacket come with a free knee board?


No! They come with knee pads!