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Old 09-14-2005, 09:52 PM   #1  
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Joined APC: Feb 2005
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Default NWA ALPA Ziplines

A letter from the NWA MEC Chairman to the pilots of ALPA Councils
1, 20, 55, & 74

TO: Northwest Pilots
FROM: MEC Chairman Mark McClain
DATE: September 14, 2005

NWA management announced today that it filed for bankruptcy
protection under Chapter 11 of the U.S. Bankruptcy Code. The
petition was filed in the United States Bankruptcy Court for the
Southern District of New York at approximately 5:30 p.m. EDT and
assigned to Judge Allen Gropper. The provisions of Chapter 11 allow
management to continue operations as it attempts to financially
restructure the corporation.

The NWA MEC and NWA pilots are extremely disappointed by this
outcome. The pilot group has made reasonable and responsible
decisions since Sept. 11, 2001 in an attempt to avoid bankruptcy.
After careful, thorough and analytical examination, the NWA MEC
recognized NWA's precarious financial condition beginning in April
2003. The result of that analysis was that, although bankruptcy was
not a near-term threat in 2003, the threat of Chapter 11 was likely
to increase absent significant cost restructuring.

We spent two and a half years trying to convince other NWA
stakeholders to join with us in that restructuring, including
numerous meetings and phone calls with other unions in the last few
days. NWA pilots alone participated with management in the Bridge
Agreement to further that goal. Unfortunately, the once distant
possibility of bankruptcy has become today's reality.

The bankruptcy process will require a great deal of management's
attention, focus and resources. Often the day-to-day operation of
the airline itself takes a back seat to a Chapter 11 proceeding. We
cannot afford this result at NWA. ALPA strongly encourages
management to continue to focus its attention on the airline's
operations while it develops a plan of reorganization (POR). Our
eventual exit from Chapter 11 will require both a viable POR and a
strong airline operation.

NWA management is expected to seek first day orders to authorize
the payment in the ordinary course of certain sums which were
earned or accrued prior to the bankruptcy, including salaries and
benefits for its employees. Such orders have been sought in each
major airline bankruptcy case filed in the last few years. Assuming
that such an order is sought and granted, as we expect, you can
expect your pay and benefits to continue under the provisions of
the First Day Order until a new agreement is reached or until the
provisions of Section 1113(c) or (e) of the U.S. Bankruptcy Code
result in contract changes.

Under section 1113(e) of the Bankruptcy Code, management may
request interim relief from the collective bargaining agreements of
any or all labor unions. It is possible that NWA will seek such
relief. Interim relief may be requested with respect to the terms,
conditions, wages, benefits, and/or work rules found in the
contract. Management must show that such relief is "essential to
the continuation of the debtor's business," or is needed "in order
to avoid irreparable damage to the estate." A company may file a
request for such changes very quickly and a hearing may also be
held on an expedited basis, although such requests may be mooted by
consensual agreements. If a request for interim relief is granted
by the bankruptcy judge, such relief could occur soon, but it does
not supplant other requirements of Section 1113 that must be met in
order for long-term changes to be made to collectively bargained

If NWA management seeks 1113(e) relief, appropriate notice and
hearings are required and we will communicate that information to
you as soon as it is known.

Now that NWA has filed for bankruptcy protection you can expect
even more media attention to be focused on NWA and it operations.
The seemingly endless barrage of bad news will most likely continue
and intensify in the coming weeks and months. It continues to be
our most important job to leave these distractions outside the
cockpit. Please continue to focus your attention and energy on
conducting safe operations and leave the extraneous issues
surrounding these difficult times to ALPA and its experts.

Although the NWA MEC has worked diligently to help avoid a
bankruptcy filing, the MEC finds itself well prepared for this
eventuality. Since April 2003 we have retained the services of
ALPA's General Counsel, the law firm of Cohen, Weiss, and Simon LLP
in New York, to advise on potential bankruptcy questions. Lead
counsel, Richard Seltzer has represented ALPA pilots in numerous
prior Chapter 11 bankruptcies, including both US Airways cases,
Hawaiian, Polar/Atlas and TWA. He has also represented other unions
in bankruptcy cases in other industries. Working with him will be
Thomas Ciantra, who has also been involved in representing ALPA in
the US Airways and Hawaiian cases.

The rest of the ALPA team should be familiar to you because we have
been utilizing their services for more than three years. The team
consists of the MEC, MEC Officers, Negotiating Committee, Peter J.
Solomon and Co., the actuarial firm Buck Consultants, ALPA Economic
and Financial Analysis, ALPA R&I staff, NWA MEC R&I Committee, and
NWA BOD member Mike Ristow.

In addition, unions that have substantial bankruptcy claims are
entitled to request appointment to the unsecured creditors
committee, and ALPA has been appointed to such committees in most
major airline bankruptcy cases, including the recent US Airways,
UAL, Hawaiian, ATA, and Atlas/Polar Chapter 11 bankruptcies. We
will seek similar status for ALPA in these proceedings. If ALPA is
appointed to this committee, a NWA pilot will be selected to
represent ALPA as a member of this important committee.

The NWA MEC Communications Committee has prepared a general
informational mailing regarding the Chapter 11 process. This
question and answer document is intended to give you some basic
background information regarding the bankruptcy process, bankruptcy
law, and how the law applies to collective bargaining agreements.
You can expect this mailing very soon.

Northwest pilots have made many difficult decisions over the past
several years in an attempt to help prevent this day.
Unfortunately, as the MEC predicted in April 2003, the pilot group
could not fix the financial problems of this corporation alone.

Our focus will now shift to a new objective. ALPA at all levels
will direct its efforts towards the successful restructuring of
Northwest Airlines in the bankruptcy process in order to ensure
NWA's successful emergence from Chapter 11.

This restructuring will be painful for all Northwest employees.
There are likely to be displacements, layoffs, and demands for
substantial changes to each union contract. We will seek to contain
and mitigate this pain for NWA pilots as much as possible, while
working to bring about Northwest's successful emergence from
Chapter 11. The gravest danger from the Chapter 11 process could be
an attempt by management or creditors to overreach. Throughout this
process ALPA will oppose any such effort and will strive to protect
the best interests of the NWA pilot group.

I understand the anxiety many of you are now feeling after these
developments and the resulting uncertainty. Considerable hardship
will result for all pilots, but inevitably some of us will suffer
more than others because of our individual circumstances. It will
be important for each of us to look out for one another as much as
possible. I am confident this pilot group will find a way to
weather this difficult period. Please continue to keep safety as
your number one priority and continue to stay informed through
official ALPA communications channels.

Capt. Mark McClain
NWA MEC Chairman
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