Frontier Airlines 2005 Annual Report Download - page 98

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9. CONTINGENCIES
The Company is subject to certain legal and administrative actions which management considers routine to their business
activities. As of December 31, 2005, management believes, after consultation with legal counsel, the ultimate outcome of any pending
legal matters will not have a material adverse effect on the Company's financial position, liquidity or results of operations.
Under the American code-share agreement, the Company is subject to American’s scope restrictions. The Company paid
American $6,466 in 2005 for operating the ERJ-170s for United at Chautauqua Airlines in violation of the scope restrictions of the
code-share agreement. These payments terminated in September 2005 when the ERJ-170s were no longer operated by Chautauqua.
As of December 31, 2005, approximately 76% of the Company's workforce is employed under union contracts.
On September 1, 2005, the Company entered into a new four-year collective bargaining agreement with its flight attendants
who are represented by the International Brotherhood of Teamsters, AFL-CIO.
The Company and an affiliate of Wexford Capital, among others including US Airways and the Airline Pilots Association,
have been named as defendants in a lawsuit filed in October, 2005 by certain US Airways pilots. The lawsuit was filed in the United
States District Court for the Eastern District of New York. The lawsuit as it relates to the Company, would require the Company to
employ certain pilots of US Airways under terms that would be more favorable to the pilots as compared to terms that were
contemplated to be offered to the pilots by the Company. The Company, on the advice of its legal counsel, believes that the lawsuit, as
it relates to the Company, is wholly without merit and the Company intends to ask the court to dismiss the lawsuit against it at the
earliest practicable date. The lawsuit asks for monetary damages of $1.2 billion.
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Source: REPUBLIC AIRWAYS HOLDINGS INC, 10-K, February 27, 2006 Powered by Morningstar® Document Research℠