Originally Posted by
stinsonjr
Regional Question:
When mainline carriers contract with a regional to provide feed, are there specific reasons that the mainline carrier can void the contract? My thinking is that like certain financial instruments, if xyz goes below abc then you cash us out. Do the mainline carriers state "if your balance sheet looks a certain way, and your potential liabilities exceed your net worth, we can void the contract and go with another regiona in better financial shape"? Similiar to a loan convenant with a bank - does this exist in the regional world, and if so, I wonder if Mesa's balance sheet is getting close to triggers?
If you take a look at Mesa's annual report it provides some detail on how the contracts can be canceled. Balance sheet and net worth ain't one of them. Performance however is - but believe me, regardless of how you feel about Mesa's performance it hasn't fallen to the level where contract cancellation is an option.