Fill Me In....

[B767Driver]

What's the deal with Xjet? I'm out of the loop. CAL is cutting them loose and they're getting bid up by SKW? Is this basically ACA redux?

[jtrain609]

It's kinda complicated. This e-mail sums it up the best.

April 7, 2008

Mr. James B. Ream
Chief Executive Officer and President
ExpressJet Holdings, Inc.
700 North Sam Houston Parkway, Suite 200
Houston, TX 77067


Mr. George R. Bravante, Jr.
Chairman
ExpressJet Holdings, Inc.
700 North Sam Houston Parkway, Suite 200
Houston, TX 77067


Dear Jim and George:

We understand that SkyWest, Inc. (“SkyWest”) has delivered to you an offer to acquire ExpressJet Holdings, Inc. (“ExpressJet”). In connection with your consideration of such offer, we wanted to inform you of our understanding with SkyWest regarding a new capacity purchase agreement (“CPA”) and our intentions regarding our existing contractual relationship.

First, we confirm that we have negotiated a new CPA with SkyWest, which would become effective if SkyWest is successful in acquiring ExpressJet (which, in turn, is subject to due diligence, among other things), and that we would consent to the change of control that would occur upon such an acquisition.

Second, absent our entering into a new CPA with savings of the magnitude we have negotiated with SkyWest, we currently expect to deliver to ExpressJet on June 28, 2008, a notice to withdraw 51 of the existing 205 Covered Aircraft from the current CPA, beginning in December 2009. Further, although we have the right to terminate the existing CPA at any time, we currently anticipate we will not extend the term of the current CPA (which we must do, if at all, by December 31, 2008), and thus the current CPA would simply expire in accordance with its terms beginning on December 31, 2010, with the expectation that all aircraft would be removed from the current CPA by the end of 2012.

We hope this information is helpful to you.

Sincerely,

Jeffrey J. Misner
Executive Vice-President and Chief Financial Officer
Continental Airlines, Inc.

Or said another way, sell or be killed.

[meritflyer]

SkyWest made an "unsolicited" bid for ExpressJet which was ultimately turned down. Then Continental goes on record with the letter above (as filed with the SEC). SkyWest has basically gone cloak and dagger on ExpressJet. Continental wants ExpressJet's management team gone and SkyWest is essentially the way to make that happen. It's no secret that Jim Ream of Express and Larry Kellner have a real distaste for each other.

SkyWest thinks ExpressJet is headed for bankruptcy given their current cash burn, contracts and their respectful date of expiration, lack of progress with new CPA's, and troubled Branded operation. SkyWest has made a proposal to ExpressJet pilots that eliminates their scope, takes them out of LAX, puts 800 guys on the street, closes Branded operations, and allows flying to be slowly moved from ExpressJet Holdings to SkyWest.

Not a good situation for ExpressJet given the struggles they've faced and will continue to face.

[jtrain609]

STFD

[Lee D]

Sincere question. If nothing came of the SkyWest bid, how likely are furloughs at Xjet? (Understanding of course that no one can truly predict such things.)

No matter what, you have my support. If a SkyWest purchase happened I hope it would go like the ASA purchase did. Keep your contract, and no furloughs. Though from the letters that have been posted that does not appear to be the intention.

[B767Driver]

Any particular reason for the change? Costs, service, etc? Seems like Xjet was a good connection carrier for CAL. I suppose it always comes down to costs.

[Nick]

Originally Posted by B767Driver

Any particular reason for the change? Costs, service, etc? Seems like Xjet was a good connection carrier for CAL. I suppose it always comes down to costs.

I just flew with someone that supposedly knows some higher-ups at Continental. I don't know what that means. But based on lots of other stuff he said I actually do believe that he really does know some people high on the totem pole at CAL. Who knows.

Anyway, he said two weeks ago Gordon Bethune really ripped Larry Kellner a new one in a meeting in front of quite a few people, and it was in regards to messing with the regional airline stuff. I guess it was an "if it ain't broke don't fix it" type of thing which makes sense.

[TheShortOne]

Skw=cheaper for Cal
plus Cal's upper mgmt doesn't like the xjet mgmt and has been trying to get rid of them for a while (see 69 previously released airplanes)

[meritflyer]

Originally Posted by Lee D

Sincere question. If nothing came of the SkyWest bid, how likely are furloughs at Xjet? (Understanding of course that no one can truly predict such things.)

No matter what, you have my support. If a SkyWest purchase happened I hope it would go like the ASA purchase did. Keep your contract, and no furloughs. Though from the letters that have been posted that does not appear to be the intention.

Furloughs are a certainty regardless. ExpressJet recently said they plan on pulling the branded schedule down this fall drastically and/or closing it. The email said, either way staff reductions will be a result.

[jtrain609]

They're not a certainty, I talked with some folks and they're going to offer further COLA's for the same numbers they've got out now.

[meritflyer]

Originally Posted by jtrain609

They're not a certainty, I talked with some folks and they're going to offer further COLA's for the same numbers they've got out now.

The first round of COLA's weren't exactly a slam dunk. I'd love to see the company iron this out without furloughs but personally, I don't think it's in the cards.

Not to mention Branded's schedule only goes through August.

[jtrain609]

Yeah you noticed that eh?

I'm applying to the U's Masters in Public Policy program for fall of 2009...

[meritflyer]

Originally Posted by jtrain609

Yeah you noticed that eh?

I'm applying to the U's Masters in Public Policy program for fall of 2009...

Nice! That way you and I can go at it when the U plays BYU.

[jtrain609]

Me and Emily both, actually, it can be a three way.

We'll have to see if they let us in first.

[Lee D]

Originally Posted by meritflyer

Nice! That way you and I can go at it when the U plays BYU.

I'll throw my dog in that fight. GO UTES!

[Captain_Bob]

Originally Posted by meritflyer

Not to mention Branded's schedule only goes through August.

Originally Posted by jtrain609

Yeah you noticed that eh?

Southwest's schedule only goes through October... They must be going out of business too...

Originally Posted by southwest.com

(We are currently accepting reservations through October 30, 2008. )