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Restructuring: Mesa Air Group Investor Q&AImpact on Shareholders1. I am a shareholder, what happens to my stock? There is no assurance as to what value, if any, will be ascribed in the Chapter 11 case to Mesa’s existing common stock or any other equity securities. See also paragraph no. 5 below for more information regarding trading of the Company’s common stock. 2. Do shareholders receive payments if shares are cancelled under a reorganization plan? Creditors have priority over shareholders under the provisions of the U.S. Bankruptcy Code. Shareholders are not entitled to receive a recovery under court-approved reorganization plans until all creditors and others ahead of shareholders in priority receive payment in full. 3. Why did NASDAQ give notice to delist Mesa’s shares? It is at the sole discretion of NASDAQ as to when and whether a stock will continue trading. NASDAQ can request that the SEC delist Mesa’s common stock if they believe Mesa is no longer in compliance with NASDAQ listing requirements. These requirements are both quantitative and qualitative. When a NASDAQ listed company files for Chapter 11 the Exchange may exercise its discretion as to whether to continue the listing and trading of the securities of the company. Additionally, if a company falls below any continued listing standard files or announces intent to file for Chapter 11 or for relief under any provisions of any bankruptcy laws, it is common for NASDAQ to suspend trading and consider moving to delist an issuer’s securities. For more information please see www.nasdaq.com. 4. Which of the NASDAQ continued listing standards did Mesa no longer meet? NASDAQ determined to suspend trading based on the announcement of the Chapter 11 filing. This decision was reached by Nasdaq under Listing Rules 5101, 5110, 5110(b) and IM-5101-1 in view of such filing. 5. Where will Mesa’s shares trade now? For how long? Trading of the Company’s common stock on the Nasdaq Stock Market will be suspended at the opening of business on January 14, 2010, and a Form 25-NSE will be filed with the Securities and Exchange Commission (“SEC”), which will remove the Company’s common stock from listing and registration on the Exchange. The Company’s common stock is currently trading on the OTC Bulletin Board or in the “Pink Sheets” under the symbol MESAQ. 6. What are the “Pink Sheets”? The “Pink Sheets” is an electronic quotation system that displays quotes from broker dealers on many over-the-counter (OTC) securities. They are published today by Pink OTC Markets Inc., a privately owned company. Issuers may not list securities on the Pink Sheets, only broker-dealers who are market makers may apply to publish quotations on the Pink Sheets. Pink OTC Markets Inc. is a private company the does not register with the SEC and is not affiliated in any way with Nasdaq or FINRA. 7. Will you continue to file financial reports to remain in compliance with the SEC? Yes, the company plans to continue filing financial reports with the SEC. 8. Is it possible Mesa’s shares will again trade on the NASDAQ? Mesa does not plan to pursue a lifting of the suspension or a relisting of its shares on the NASDAQ during the pendency of its Chapter 11 proceedings. General Questions 9. What is Chapter 11? Chapter 11 of the U.S. Bankruptcy Code was enacted by Congress to allow companies to restructure debts under protection from creditors while operating their business in the ordinary course, including paying employee salaries and benefits, continuing customer programs and other critical business operations. Chapter 11 should not be confused with Chapter 7, which is used by companies that are shutting down operations and liquidating assets. Mesa is restructuring its debt – particularly that debt associated with its fleet of excess aircraft – and is not going out of business. 10. Why did Mesa file for Chapter 11? Over the past two years, we have worked closely with our lessors, creditors and other constituents to restructure our financial obligations. These efforts have led to the elimination of over $160 million of debt obligations, the return of a number of aircraft, and the restructuring of inventory management and engine overhaul agreements. We are nonetheless faced with an untenable financial situation resulting primarily from our continuing lease obligations on aircraft excess to our current operating requirements. After careful consideration, the Company determined that a Chapter 11 filing provides the most effective and efficient means to restructure with minimal impact on the business and our customers. This process will allow us to eliminate excess aircraft to better match our needs and give us the flexibility to align our business model to the changing regional airline marketplace, ensuring a leaner and more competitive company poised for future success. 11. How will the Company operate during this process? The Company has sufficient liquidity to support its operations during the restructuring and beyond. 12. Is Mesa or any of its business units going out of business? Will there be a liquidation? No. We continue to operate our business and serve our code-share partners and passengers in our Delta Connection, United Express and US Airways Express operations. In addition, we will continue to serve our go! Mokulele passengers and will continue our frequent flyer program. 13. What’s the plan for the Company after filing? Our plan is to operate in the normal course for our code-share partners and passengers in the communities we serve. 14. How is Mesa’s go! Mokulele joint venture affected? It won’t. While our go! Mokulele joint venture contracts with Mesa to provide regional jet service, it is its own separate entity and is not included in this filing and will continue to operate its full flight schedule. 15. Will the current management team stay in place? Mesa’s management team is actively engaged and committed to the Company and intends to guide its emergence from Chapter 11 and return to sustained profitability. 16. Is Mesa Air Group for sale? No. The Company intends to restructure its operations and emerge from Chapter 11 equipped for long term success. 17. What is Mesa’s go-forward business strategy? To ensure our long-term success, Mesa will align its business model to the changing regional airline marketplace by right-sizing its aircraft fleet. Together with our proven regional airline model, strong reputation and the enormous talent of our people we will continue to deliver a revitalized, customer focused company that provides safe, reliable and cost efficient regional jet services to our code-share partners and passengers. 18. Where did the Company file its petition? The Company filed its Chapter 11 petition in the United States Bankruptcy Court for the Southern District of New York. The case number is 10-10018 is being presided over by the Honorable Judge Martin Glenn. |
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