Rat, MD, and all YX guys on here understand that I am sympathetic to your cause and I realize that everything happening to you guys is unfair. The pay cuts, furloughs, loss of QOL are all unacceptable. Our union has given us no direction on what to do or what to expect. All we hear from them is, "this is gonna take a long time" and that "the integration must wait until all parties involved are present." I think you will find that most RAH pilots with a head on their shoulders realize that this isn't progressing the way we had hoped it to. I understand that the hand being dealt to you guys is crap. However there is nothing good that is gonna come of driving all of us apart. Until YX ALPA can figure out a way to stop it through arbitration it will keep going the direction it is. Remember that most of us here at RAH are reasonable people. However when we come onto these boards to read about what your thoughts are all we read is how you guys want nothing to do with us and hope we all get furloughed because in your eyes we are somehow less of a person because we happened to be flying for a regional when all this went down. Remember that most of us here were just trying to get our time and move onto greener pastures (like Midwest). Bedford has changed everything and whether we want to or not we are going to eventually have to integrate and some years down the road I may be flying right seat next to you. I really think its bad form to be pitting the pilot groups against each other this early in the game. Let the unions, arbitrators, and lawyers figure all that stuff out and lets move forward and work towards making this place a less toxic environment to work in.

 

Nice post Trojan. I guess a lot of us are still in denial. As a tribute to today, I will not post any negative innuendo. Instead, I hope we all stop and think about those who are putting their lives in harms way so we can have our petty arguments. We can go back to that tomorrow. Let us never forget this day.

Dirty Rat

 

Well said. Everyone should take a moment to remember those 8 pilots and 2993 souls who perished 8 years ago today. Remember in the whole scheme of things we are all on the same team.

 

What you assert would have merit if this were an integration or merger but it isn't, you were purchased. I'm probably wrong, usually I am, but it's always been my understanding that when one company purchases another it doesn't really matter much what provisions were in place before. I'm not sure your contract is going to matter much if at all.

 

I have alittle experience in this type of stuff. My understanding is that a company can be bought or merged two ways...

1. Asset purchase. Contracts have no standing and the company name is not part of the deal. You buy stuff. All contracts with the company (Midwest) are not part of the deal. (eg. code-shares, labor contracts, gate and slot contracts)

2. Stock purchase. The purchasing company buys the stuff, federal tax credits, naming rights (Midwest, Best care in the air, etc) and all contracts are included. Midwest Air Group (MAG).


Does this read like a asset purchase?


Item 2.01

On July 31, 2009, pursuant to the terms of the Agreement and Plan of Merger, dated as of June 23, 2009, among Republic Airways Holdings Inc. (the “Company”), RJET Acquisition, Inc. and Midwest Air Group, Inc. (“MAG”), as amended (the “Merger Agreement”), RJET Acquisition, Inc. merged with and into MAG (the “Merger”) with MAG continuing as the surviving corporation and becoming a wholly-owned subsidiary of the Company. Pursuant to the Merger Agreement, at the effective time of the Merger, the shares of MAG that were outstanding immediately prior to the effective time of the Merger were converted into the right to receive an aggregate amount in cash equal to $1.00. In connection with the closing of the Merger, the Company also consummated the transactions contemplated by the Investment Agreement, dated June 23, 2009 (the “Investment Agreement”), among TPG Midwest US V, LLC, TPG Midwest International V, LLC) (together, the “TPG Entities”) and the Company. Pursuant to the Investment Agreement, at the effective time of the Merger, the Company purchased from the TPG Entities their $31 million secured note from Midwest Airlines, Inc., a wholly-owned subsidiary of MAG, for approximately $6 million in cash and issued the TPG Entities a convertible note having a principal amount of $25 million and a five-year maturity and convertible by the TPG Entities in whole or in part, from time to time, prior to maturity into 2,500,000 shares of the Company’s common stock, subject to adjustment in certain circumstances.

The foregoing description of the terms set forth in the Merger Agreement and Investment Agreement are qualified in their entirety by reference to the text of the Merger Agreement and the Investment Agreement, respectively. A copy of the Merger Agreement was attached as Exhibit 10.62(f) and a copy of the Investment Agreement was attached as Exhibit 10.62(g) to the Company’s Current Report on Form 8-K filed with the Securities and Exchange Commission on June 24, 2009.


A copy of the press release of the Company announcing the closing of the Merger is attached hereto as Exhibit 99.1 and incorporated herein by reference.




Upon consummation of the Merger and pursuant to the Investment Agreement, on July 31, 2009, the Board of Directors of the Company voted to increase its size from five to six members and appointed Richard P. Schifter, a managing partner at TPG, to the Board of Directors of the Company. The Board of Directors did not appoint Mr. Schifter to serve on any of its committees

 

On July 31, 2009, pursuant to the terms of the Agreement and Plan of Merger, dated as of June 23, 2009, among Republic Airways Holdings Inc. (the “Company”), RJET Acquisition, Inc. and Midwest Air Group, Inc. (“MAG”), as amended (the “Merger Agreement”), RJET Acquisition, Inc. merged with and into MAG (the “Merger”) with MAG continuing as the surviving corporation and becoming a wholly-owned subsidiary of the Company. Pursuant to the Merger Agreement, at the effective time of the Merger,


Thevagabond, I believe it states MERGER, not a purchase and the contract does matter. Just because a company buys another or is merged with another doesn't mean the contract gets thrown out.

 

Here's how many Midwest pilots see this deal from the unemployment line...


Additionally, the Frontier pilots contend that they will remain separate, claiming that Republic CEO Bryan Bedford has maintained that this is also his goal. This is consistent with Article 9, §9.01 (a) of the August 13, 2009, second amended and restated investment agreement between RAH and the Frontier entities which provides that, once Frontier emerges from reorganization and RAH takes over ownership:

“Subject to the provisions of the Railway Labor Act, upon the Closing, the Investor will (i) be bound by the current Collective Bargaining Agreement between Frontier Airlines and the Frontier Airlines Pilots Association as amended and in effect as of the Closing (the “FAPA CBA”), (ii) recognize Frontier Airlines Pilots Association as the representative of Frontier Airlines pilots and (iii) assume employment of such pilots represented by the Frontier Pilots Association. Upon and after the Closing, the Company shall continue to be responsible for implementing and carrying out its obligations under the FAPA CBA.”

This provision in the RAH-Frontier investment agreement appears to be in breach of the IBT's agreement with Republic which states:

Article 1. D.
3. The Company, Subsidiary of the Company, the Company’s Parent or Subsidiary of the Parent shall not establish any new airline (alter ego or otherwise) or acquire a controlling interest in any carrier whether directly or through the Parent or another Subsidiary of the Parent, and maintain it as a separate carrier. A “Controlling Interest” or “Control” means the ownership of an equity interest representing more than fifty percent (50%) of the outstanding capital stock of an entity or voting securities representing more than fifty percent (50%) of the total voting power of outstanding securities then entitled to vote generally in the election of such entity’s board of directors or other governing body.

Recently, I received a letter from the Republic pilots informing us that, “The Teamsters are filing a Grievance against Republic Airways Holdings for the violation of our scope, in respect to the LOA which has been ratified between it, Frontier Airlines, and FAPA.”

Unfortunately, the Midwest pilot group is aware of just how long this process can take. Furthermore, we have no idea which party will prevail. Meanwhile, in reviewing the Republic pilots’ CBA more closely, RAH’s actions in replacing Midwest’s flying with Republic’s equipment and pilots is in violation of the IBT contract:

H.5.
c. The operations of the Company and those of the other air carrier shall be kept separate unless and until the processes described in paragraph b above is completed and the seniority lists of the two pilot groups are integrated in accordance with Sections 3 and 13 of the Allegheny-Mohawk Labor Protective Provisions are completed. During such time of separate operations, neither aircraft nor pilots shall be interchanged without the Union’s written consent.

After the Republic pilots rejected our request to work together to choose an arbitrator and begin the process, we determined that it was in our pilot group’s best interest to move forward. Your Merger Committee—along with our outside merger counsel, John O’Brien Clarke of Highsaw, Mahoney, and Clarke—chose Mr. Frederic R. Horowitz as the arbitrator. He has agreed to hear our arbitration and we expect our first meeting the week of September 21, 2009. While we continue to make every effort to engage the Republic pilots in working with us, be assured that we are taking every legal action necessary to keep this process moving forward.

 

I was always under the impression that unless in BK a company simply couldn't drop another companies contracts. You purchase a company you purchase their debts and other obligations (contracts). Hence CHQ flying for AMR. AMR purchased TWA which CHQ had a contract with. I didn't major in business though. If I'm wrong on what happens in a merger/acquisition or in the history of the company feel free to correct me. I'm a little light headed at the moment from the pain killers

 

I hope you will take that to another level and stop the negative posts toward the RAH pilots, and figure out how you can work with them. Trojan is right, in that most RAH pilots were not happy about the acquisition of Midwest, the 190's, etc..., in that nearly all of us took the job to get our time and move on. We aren't happy about what's happening to you guys either. It isn't right, and it downright sucks. But animosity amongst each other is exactly what management likes to see from a pilot group...

 

That's all fine and all but your duty as a union member is to file a grievance when your contract is broken. Yet not a one of you has filed one though both our ALPA and independent counsel says it's a violation. What are we to think of your group when they won't do the right thing? IBT has continously ignored their own contract and the line pilots are sitting on their hands and allowing it. Like I asked previously, what will it take for the pilots at RAH to do something besides follow a flawed corrupt union. Time for excuses is over. The car is stuck on the train tracks. The whole world is watching. The train is half a mile away. Are you going to do anything or just secure your own safety?