SkyWest Airlines 2004 Annual Report Download - page 15

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Both facilities were internally funded with cash generated from operations and were subsequently refinanced with third-party
debt.
Management deems the Company's current facilities as being suitable and necessary to support existing operations and believes
the Company's facilities will be adequate for the foreseeable future.
ITEM 3. LEGAL PROCEEDINGS
The Company is subject to certain legal actions which it considers routine to its business activities. As of December 31, 2004,
management believes, after consultation with legal counsel, that the ultimate outcome of such legal matters are not likely to have
a material adverse effect on the Company’s financial position, liquidity or results of operations. The most significant of these
matters is as follows:
Michaelena Fitz-Gerald, Romead Neilson, et al., v. SkyWest Airlines, Inc.
In July 2003, two former employees of SkyWest commenced litigation in the Superior Court of Santa Barbara, California,
alleging violations of minimum wage, meal and rest break, and overtime regulations, as well as violations of the California Labor
Code and Business and California Professions Code. In addition to their own claims, the plaintiffs have pled the case as a class
action on behalf of all current and former flight attendants based in California since July 1999 but had not obtained class
certification as of March 10, 2005. The plaintiffs are seeking monetary damages as compensation for their grievances. The
Company and the plaintiffs have engaged in discovery and unsuccessfully attempted to mediate a settlement without reaching a
mutually acceptable result. The Company is vigorously opposing the plaintiffs’ claims. Because the amount of a potential loss, if
any, resulting from the outcome of the forgoing case is neither probable nor reasonably estimable, no amounts related to such
have been recorded in the Company’s condensed consolidated financial statements.
Securities and Exchange Commission
Effective January 1, 2002, the Company changed its method of accounting for CRJ200 engine overhaul expenses. In connection
with the change in accounting method, the Company restated its financial statements for the year ended December 31, 2001 and
the first and second quarters of the year ended December 31, 2002. The restated financial information, together with a discussion
of the change in accounting method, was presented in the Company's Amendment No. 1 on Form 10-K/A for the year ended
December 31, 2001 and Amendments No. 1 on Forms 10-Q/A for the quarters ended June 30, 2002 and June 30, 2002. The staff
of the Securities and Exchange Commission is investigating facts pertaining to the Company’s change in accounting method and
other changes presented in the restatement of the Company’s financial statements. During the spring of 2004, the staff and
counsel for the Company and its officers engaged in discussions regarding potential resolution of the investigation. Those
discussions have not resolved the investigation and the staff has continued the investigation. The Company and its officers intend
to continue to cooperate with the staff in the investigation.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
No matters were submitted to a vote of security holders during the fourth quarter of the year ended December 31, 2004.