Dear Captains Woerth and Leneski,
This letter will confirm the commitments and obligations of ExpressJet Holdings, Inc. and XJT Holdings, Inc. (hereinafter referred to as “Holdings”) with respect to any and all flying performed by Holdings or any of its affiliates utilizing aircraft greater than 19 passenger seats and whose pilots are covered by the Railway Labor Act (“RLA”). Holdings and the Air Line Pilots Association (“Association” or “ALPA”) agree as follows:
1. Any and all flying performed by or for Holdings or any affiliate of Holdings pursuant to a
code sharing agreement, capacity purchase agreement, special prorate agreement or
similar agreement (“Code Share Agreement”) between Continental Airlines, Inc.
(“Continental”) and Holdings or any of its affiliates utilizing aircraft with greater than 19
passenger seats will be performed by ExpressJet Airlines, Inc. (“ExpressJet” or
“Company”) under the terms of the Agreement between ExpressJet Airlines, Inc. and ALPA
dated December 1, 2004 (“Agreement”).
2. If Holdings creates or establishes an air carrier, including through an existing or new
affiliate, Holdings will ensure that this air carrier recognizes ALPA as the representative of
its pilots consistent with the RLA, that the air carrier adopts a collective bargaining
agreement identical to the Agreement and that all flying by or for the air carrier will be
performed by pilots on the ExpressJet Pilot Seniority List (the “Pilots’ Seniority List”). Filling
of vacancy and displacement rights for such pilots at the new air carrier will be established
by mutual agreement between ALPA, ExpressJet and the new air carrier, provided that if
an agreement is not executed within 30 days from the date the affiliate was created or
established, the parties shall jointly submit outstanding issues on the filling of vacancies
and displacement rights to expedited binding arbitration.
3. As a material and irrevocable condition of entering into an agreement for the acquisition or control of an air carrier or affiliate of an air carrier that operates pursuant to any Code Share Agreement providing feed flying for another carrier, Holdings will ensure that, subsequent to the acquisition:
a. The acquired air carrier does not enter into any new Code Share Agreement
unless the Code Share Agreement(s) in existence at the time of the acquisition is
terminated by the acquired air carrier’s Code Share Agreement partner;
b. ExpressJet and the acquired air carrier accept and implement an integrated pilot
seniority list produced pursuant to:
i. ALPA Merger Policy, if the pilots of the acquired air carrier are
represented by the Association or
ii. Section 3 and 13 of the Allegheny-Mohawk Labor Protective Provisions, if
the pilots of the acquired air carrier are not represented by the Association
for the purpose of the filling of vacancies and establishing displacement rights
between the air carriers, provided that implementation of the integrated seniority
list does not result in substantially greater costs to either airline;
c. If the acquired air carrier’s pilots are not represented by a labor organization, the
acquired air carrier agrees to the provisions for filling of vacancies and
displacement rights between the air carriers as negotiated and agreed to by the
Association and ExpressJet for pilots at both airlines, provided that if an
agreement is not executed within 30 days from the date of acquisition of the
acquired air carrier, the Association and ExpressJet shall jointly submit
outstanding issues on the filling of vacancies and displacement rights to expedited
binding arbitration;
d. In the event the Association attempts to organize the pilots of an acquired air
carrier whose pilots are not represented by a labor organization, the acquired air
carrier will take a position of neutrality regarding representation of its pilots and
will provide ALPA access to its pilots for organizing purposes and recognize ALPA
as the bargaining representative pursuant to a certified card check consistent with
the RLA;
e. If the acquired air carrier’s pilots are represented by a labor organization 0other
than the Association, ExpressJet and the acquired air carrier agree to the
provisions for filling of vacancies and displacement rights as negotiated and
agreed to by ExpressJet, the acquired air carrier, ALPA and the other labor
organization; provided that if an agreement is not executed within 30 days from
the date of acquisition of the acquired carrier, ExpressJet, the acquired air carrier
and ALPA shall jointly submit outstanding issues on the filling of vacancies and
displacement rights to binding arbitration;
f. If the acquired air carrier’s pilots are represented by the Association, ExpressJet
and the acquired air carrier agree to the provisions for filling of vacancies and
displacement rights negotiated and agreed to by ExpressJet, the acquired air
carrier and ALPA; provided that if an agreement is not executed within 30 days
from the date of acquisition of the acquired carrier, ExpressJet, the acquired air
carrier and ALPA shall jointly submit outstanding issues on the filling of vacancies
and displacement rights to expedited binding arbitration;
g. No ExpressJet aircraft (including orders and options) shall be transferred to the
acquired air carrier; provided however, if Continental reduces the number of
aircraft flying pursuant to the capacity purchase agreement between Continental
and ExpressJet, that number of aircraft may be transferred to the acquired air
carrier; and,
h. Pending the implementation of the provisions for filling of vacancies and
displacement rights between the air carriers and the integrated pilot seniority list in
paragraphs 3.b.,c.,e. and f., above, no pilot on the ExpressJet pilot seniority list
shall be reduced in status or pay category, nor shall vacancies be filled at the
acquired air carrier that are the result of a new Code Share Agreement or
transferred aircraft permitted in paragraph 3.a. or g., above.
4. If Holdings acquires an air carrier that does not have a Code Share Agreement and only
operates aircraft lawfully operable in commercial passenger flight operations with
maximum seating capacity in excess of 70 seats, Holdings will merge such air carrier with
ExpressJet pursuant to Section 1.D.3. of the Agreement. However, the merged agreement
referred to in Section 1.D.3.b. of the Agreement may, at the Company’s option, provide for
separate operating divisions with rates of pay, rules and working conditions for each of the
pre-acquisition operations. The rates of pay, rules and working conditions at each division
will be those in place at the time of the acquisition. Further, pursuant to this option, the
merged contract will contain provisions for filling of vacancies and displacement rights
between the divisions. The provisions for filling of vacancies and displacement rights
between the divisions and the duration section of the merged agreement will be
determined through mutual agreement between the Company and the Association. If an
agreement is not executed within 30 days from the date of acquisition of the acquired air
carrier, the Association and ExpressJet shall jointly submit outstanding issues to expedited
binding arbitration as provided in Section 1.D.3.b.
5. If Holdings acquires an air carrier that does not have a Code Share Agreement and
operates aircraft lawfully operable in commercial passenger flight operations with
maximum seating capacity of 70 seats or less, such air carrier will be merged with
ExpressJet pursuant to Section 1.D.3.a. through d. of the Agreement.
6. The flying set forth in Section 1 of the Agreement and in this letter comprise any and all
flying that may be performed by Holdings or for any affiliate of Holdings utilizing aircraft
with greater than 19 passenger seats and with pilots who are covered by the RLA.
7. This letter shall be binding upon any successor or assign of Holdings. For purposes of this
paragraph, a successor or assign shall be defined as an entity which acquires all or
substantially all of the assets or equity of Holdings through a single transaction or multistep
related transactions which close within a 12 month period.
8. No contract or other legally binding commitment involving the transfer of ownership or
control pursuant to a successorship transaction, whether by sale, transfer or lease of
Holdings or substantially all of its assets, will be signed or otherwise entered into by
Holdings unless it is agreed as a material and irrevocable condition of entering into,
concluding and implementing such transaction that the obligations contained in this letter
will be assumed by the successor. Holdings shall give notice of the existence of this letter
to any purchaser, transferee, lessee, or assignee. Such notice shall be in writing with a
copy to the Association, at the time the seller, transferor, or lessor executes a definitive
agreement with respect to a transaction as herein described.
9. In the event of a dispute over the interpretation of this letter, such dispute will be resolved by final and binding arbitration under the expedited dispute resolution provisions of Section 1 of the Agreement. The parties specifically recognize and agree, however, that Holdings is not, and nothing in this letter (including this paragraph) means or can be construed as meaning that Holdings is or has agreed that it is subject to the RLA.
10. This letter shall be effective upon execution and shall run concurrently with the Agreement including any status quo period under the RLA.
Sincerely, Accepted and Agreed:
________________________ ________________________
James B. Ream Duane E. Woerth
President and CEO President
ExpressJet Holdings, Inc. Air Line Pilots Association
________________________ ________________________
James B. Ream Mark Leneski
President and CEO Chairman
XJT Holdings, Inc. ExpressJet MEC
