<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------------------
FORM S-8
REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OF 1933
----------------------
MESA AIR GROUP, INC.
(Exact name of Registrant as specified in charter)
New Mexico 85-0302351
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
----------------------
2325 East 30th Street
Farmington, New Mexico 87401
(Address of Principal Executive Office)
----------------------
MESA AIRLINES, INC. OUTSIDE DIRECTORS' STOCK OPTION PLAN AND
MESA AIRLINES, INC., ADDITIONAL OUTSIDE DIRECTORS' STOCK OPTION PLAN
(Full title of plan)
----------------------
Gary E. Risley, Esq. COPIES TO:
Vice President of Legal Affairs and Secretary Paul R. Madden, Esq.
MESA AIR GROUP, INC. CHAPMAN AND CUTLER
2325 East 30th Street Two North Central, Suite 1100
Farmington, New Mexico 87401 Phoenix, Arizona 85004
(505) 327-0271 (602) 256-4060
(Name, address and telephone number of agent for service)
----------------------
<TABLE>
<CAPTION>
Calculation of Registration Fee
=================================================================================================
PROPOSED MAXIMUM PROPOSED MAXIMUM AMOUNT OF
TITLE OF SECURITIES AMOUNT TO BE OFFERING AGGREGATE OFFERING REGISTRATION
TO BE REGISTERED REGISTERED PRICE PER SHARE PRICE(1) FEE
- -------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, 260,000 shares $8.969(1) $2,331,940 $805.00
no par value
=================================================================================================
</TABLE>
(1) Estimated pursuant to Rule 457(h) solely for the purpose of calculating the
amount of the registration fee on the basis of the average of the bid and asked
prices of the Common Stock as reported on the NASDAQ National Market on July 31,
1996 because the price at which the options to be granted in the future may be
exercised is not currently determinable.
<PAGE> 2
PART II: INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INFORMATION INCORPORATED BY REFERENCE
The following documents and information heretofore filed with the
Securities and Exchange Commission are hereby incorporated by reference:
(a) The Registrant's Annual Report on Form 10-K, File Number 0-15495,
filed on December 15, 1995, which contains audited financial statements for
the Registrant's latest fiscal year ended September 30, 1995.
(b) The Registrant's Quarterly Report on Form 10-Q, File
Number 0-15495, filed on February 14, 1996, which contains the Registrant's
unaudited financial statements for the three months ended December 31,
1995 and 1994.
(c) The Registrant's Quarterly Report on Form 10-Q, File Number
0-15495, filed on May 16, 1996, which contains the Registrant's unaudited
financial statements for the six months ended March 31, 1996 and 1995; and
(d) The description of the Company's Common Stock contained in Form 8A
filed on March 16, 1987.
All documents subsequently filed by the Registrant pursuant to Sections
13(a), 13(c), 14 and 15(d) of the Exchange Act, prior to the filing of a
post-effective amendment which indicates that all securities offered have been
sold or which registers all securities then remaining unsold, shall be deemed
to be incorporated by reference in this Registration Statement and to be part
hereof from the date of filing such documents.
ITEM 4. DESCRIPTION OF SECURITIES
Not Applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL
Not Applicable.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Section 53-11-4.1 of the New Mexico Business Corporation Act provides that
unless limited by the Articles of Incorporation, a director or officer who, in
the Board of Directors' opinion reasonably based on the facts, circumstances and
outcome of the proceeding, has been wholly successful, on the merits or
otherwise, and the defense of any proceeding to which the director or officer is
a party by reason of the fact that he is or was a director or officer, shall be
indemnified against reasonable expenses incurred by the director or officer in
connection with the proceeding.
Article VIII of the Company's Restated Articles of Incorporation states
that:
"A corporation shall indemnify each person identified in subsections A(1)
and A(4) of Section 53-11-4.1 N.M.S.A. 1978, as amended, to the fullest extent
permissible under Section 53-11-4.1 N.M.S.A. 1978, as amended, or the
indemnification provisions of any
<PAGE> 3
successor or of any statutes or as provided in the Bylaws of the corporation,
any agreement or any resolution adopted by the shareholders or directors."
Article X of the Second Amended and Restated Bylaws states that:
"In accordance with the procedures and subject to the limitations set forth
in the New Mexico Business Corporation Act, and to the fullest extent permitted
by the Business Corporation Act, the corporation shall indemnify any director or
officer or former director or officer of the corporation, or any person who may
have served at its request as a director or officer or another corporation in
which it owned shares of capital stock or of which it is a creditor, against
expenses actually and reasonably incurred by him in connection with the defense
of any action, suit or proceeding, civil or criminal, in which he is made a
party by reason of being or having been such a director or officer."
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers, or persons controlling the
Company pursuant to the foregoing provisions, the Company has been informed and
in the opinion of the securities and Exchange Commission, such indemnification
is against public policy as expressed in the Securities Act of 1933, and is
therefore unenforceable.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED
Not Applicable.
ITEM 8. EXHIBITS
Exhibit No. Description
----------- -----------
4.1 Mesa Airlines, Inc. Outside Directors' Stock Option
Plan
4.2 Amendment to Mesa Airlines, Inc. Outside Directors'
Stock Option Plan
4.3 Second Amendment to Mesa Airlines, Inc. Outside
Directors' Stock Option Plan
4.4 Form of Non-Qualified Stock Option, Mesa Airlines,
Inc. Outside Directors' Stock Option Plan
4.5 Mesa Airlines, Inc. Additional Outside Directors'
Stock Option Plan
4.6 Form of Non-Qualified Stock Option Issued Under Mesa
Airlines, Inc. Additional Outside Directors' Stock
Option Plan
5 Opinion of Chapman and Cutler
II-2
<PAGE> 4
24.1 The consent of Chapman and Cutler is contained in
Exhibit 5
24.2 Consent of KPMG Peat Marwick LLP
25 Power of Attorney (contained on Page II-5)
ITEM 9. UNDERTAKINGS
The Registrant hereby undertakes:
(a) To file, during any period in which offers or sales are being
made of the securities registered hereby, a post-effective amendment to
this Registration Statement:
(i) To include any prospectus required by Section 10(a)(3) of
the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of the registration statement (or for the most
recent post-effective amendment thereof) which, individually, or in the
aggregate, represent a fundamental change in the information set forth
in this Registration Statement;
(iii) To include any material information with respect to the
plan of distribution not previously disclosed in this Registration
statement or any material change to such information in this
Registration Statement;
provided, however, that the undertakings set forth in paragraphs (i) and
(ii) above do not apply if the information required to be included in a
post-effective amendment by those paragraphs is contained in periodic
reports filed by the Registrant pursuant to section 13 or section 15(d) of
the Securities Exchange Act of 1934 that are incorporated by reference in
this Registration Statement.
(b) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed
to be a new registration statement relating to the securities offered
herein, and the offering of such securities at that time shall be deemed to
be the initial bona fide offering thereof.
(c) To remove from registration by means of a post-effective
amendment of any of the securities being registered which remain unsold at
the termination of the offering.
The Registrant hereby further undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of
the Registrant's annual report pursuant to section 13(a) or section 15(d)
of the Securities Exchange Act of 1933 (and, where applicable, each filing
of an employee benefit plan's annual report pursuant to section 15(d) of
the Securities Act of 1933) that is incorporated by
II-3
<PAGE> 5
reference in this registration statement shall be deemed to be a new
registration statement relating to the securities offered herein, and the
offering of such securities at that time shall be deemed to be the initial
bona fide offering thereof.
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons
of the Registrant pursuant to the provisions set forth in this Registration
Statement, or otherwise, the Registrant has been advised that in the
opinion of the Securities and Exchange commission such indemnification is
against public policy as expressed in the Act and is, therefore,
unenforceable. In the event that a claim for indemnification against such
liabilities (other than the payment by the Registrant of expenses incurred
or paid by a director, officer or controlling person in connection with the
securities being registered) is asserted against the Registrant by such
director, officer or controlling person, in connection with the securities
registered hereby, the Registrant will, unless in the opinion of its
counsel the matter has been settled by controlling precedent, submit to a
court of appropriate jurisdiction the question whether such indemnification
by it is against public policy as expressed in the Act and will be governed
by the final adjudication of such issue.
II-4
<PAGE> 6
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all
requirements for filing on Form S-8 and has duly caused this S-8 Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Farmington, State of New Mexico, on July 30, 1996.
MESA AIR GROUP, INC.
By: /s/ Larry L. Risley
__________________________________
Larry L. Risley, Chairman of the Board
and Chief Executive Officer
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints Larry L., Risley and J. Clark Stevens, and either
of them, as his or her true and lawful attorneys-in-fact and agents, with full
power of substitution and resubstitution, for him or her and in his or her name,
place and stead, in any and all capacities to sign any and all amendments
(including post effective amendments) to this Registration Statement, and to
file the same, with all Exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, granting unto said
attorneys-in-fact and agents, and each of them, full power and authority to do
and perform each and every act and thing requisite or necessary to be done in
and about the premises, as fully to all intents and purposes as he or she might
or could do in person, hereby ratifying and confirming all that said
attorneys-in-fact and agents, or any of them, or their substitute or
substitutes, may lawfully do or cause to be done by virtue hereof.
II-5
<PAGE> 7
Pursuant to the requirements of the Securities Act of 1933 this S-8
Registration Statement has been signed below by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<S> <C> <C>
/s/ Larry L. Risley Chairman of the Board, Chief July 30, 1996
- ----------------------- Executive Officer and Director
Larry L. Risley (Principal Executive Officer)
/s/ J. Clark Stevens President and Director July 31, 1996
- -----------------------
J. Clark Stevens
/s/ W. Stephen Jackson Vice President Finance and July 30, 1996
- ----------------------- Treasurer (Principal Financial
W. Stephen Jackson Officer and Principal Accounting
Officer)
Director July , 1996
- ------------------------ --
Jack Braly
/s/ Blaine M. Jones Director July 29, 1996
- -------------------------
Blaine M. Jones
Director July , 1996
- ------------------------- --
George W. Pennington
Director July , 1996
- ------------------------- --
Richard C. Poe
/s/ E. Janie Risley Director July 30, 1996
- -------------------------
E. Janie Risley
</TABLE>
II-6
<PAGE> 8
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------------------------------
EXHIBITS
----------------------------------
REGISTRATION STATEMENT ON FORM S-8
MESA AIR GROUP, INC.
<PAGE> 9
INDEX TO EXHIBITS
EXHIBIT NO. DESCRIPTION
----------- -----------
4.1 Mesa Airlines, Inc. Outside Directors' Stock Option Plan
4.2 Amendment to Mesa Airlines, Inc. Outside Directors' Stock
Option Plan
4.3 Second Amendment to Mesa Airlines, Inc. Outside Directors'
Stock Option Plan
4.4 Form of Non-Qualified Stock Option, Mesa Airlines, Inc.
Outside Directors' Stock Option Plan
4.5 Mesa Airlines, Inc. Additional Outside Directors' Stock Option
Plan
4.6 Form of Non-Qualified Stock Option Issued Under Mesa Airlines,
Inc. Additional Outside Directors' Stock Option Plan
5 Opinion of Chapman and Cutler
24.1 The consent of Chapman and Cutler is contained in its Opinion
filed as Exhibit 5 hereto.
24.2 Consent of KPMG Peat Marwick LLP
25 Power of Attorney (contained on Page II-5.)
<PAGE> 1
EXHIBIT 4.1
MESA AIRLINES, INC.
OUTSIDE DIRECTORS' STOCK OPTION PLAN
<PAGE> 2
Exhibit 4.1
MESA AIRLINES, INC.
OUTSIDE DIRECTORS' STOCK OPTION PLAN
1. Purpose of the Plan; Type of Plan.
(a) Attract and Retain Talented Outside Directors. The purpose of the
Mesa Airlines, Inc. Outside Directors' Stock Option Plan (the "Plan") is to
attract and retain outside directors ("Qualified Directors") who are and will
be responsible for the growth and success of Mesa Airlines, Inc., a New Mexico
corporation (the "Company"), and its subsidiaries by providing an incentive
based form of compensation to the Qualified Directors and encouraging such
Qualified Directors to invest in shares of the Company's Common Stock to
increase the Qualified Directors' personal interest in the continued success
and profitability of the Company.
(b) Designation of Stock Options as Non-Qualified Stock Options. Stock
options granted under the Plan (the "Options") shall not be treated as
incentive stock options under Section 422 of the Internal Revenue Code of 1986,
as amended (the "Code").
(c) Exemption from Short-Swing Liability. Options granted to Qualified
Directors of the Company pursuant to this Plan shall be exempt from Section
16(b) of the Securities Exchange Act of 1934, as amended (the "Exchange Act")
pursuant to Regulation 240.16(b)-3 adopted under the Exchange Act on
May 1, 1991.
(d) Formula Plan. This Plan may be administered by the Board of
Directors of the Company (the "Board") or by any person or person chosen by a
majority of the Board. Grants or awards made pursuant to this Plan are to be
made pursuant to the formula set forth in Section 3 (the "Formula"). The
Formula is intended to qualify under Regulation 240.16b-3(c)(2)(ii) of the
Exchange Act, thereby alleviating the necessity for disinterested
administrations of the Plan required by Regulation 240.16b-3(c)(2)(i).
2. Stock and Maximum Number of Shares Subject to Plan.
(a) Description of Stock and Maximum Shares Allocated. The stock
subject to the provisions of this Plan and issuable upon exercise of the
Options are shares of the Company's Common Stock, no par value, which may be
either unissued or treasury shares, as the Board may from time to time
determine. Subject to adjustment as provided in Section 6, the aggregate number
of shares of Common Stock covered by the Plan issuable upon exercise of all
Options shall be 400,000 shares, which shares shall be reserved for use upon
the exercise of the Options. The shares available for Options and all other
shares of Common Stock of the Company shall be referred to as the "Shares."
(b) Restoration of Unpurchased Shares. If an Option expires or
terminates for any reason prior to the exercise in full before the term of the
Plan expires, the Shares subject to, but not issued under, such Option shall
again be available for other Options hereafter granted.
<PAGE> 3
3. Formula and Operation of the Plan.
----------------------------------
(a) Eligible Persons. Options will automatically be granted to all
present and future directors of the Company who are not employees of the
Company or of any subsidiary of the Company ("Qualified Directors").
(b) Date of Initial Grant. For each Qualified Director serving on
the Board as of March 1, 1993 (the "Original Directors"), who had continuously
served on the Board since March 1, 1991, Options shall be granted as of March 9,
1993 (the "New Directors"). For each Qualified Director who becomes a director
after March 1, 1993, Options shall be granted as of the first business day of
the month following appointment of the Qualified Director to the Board. (Each
date of any grant made pursuant to this paragraph 3(b) shall be referred to as
the "Initial Grant Date.")
(c) Criteria for Additional Grants. If the annual percentage
increase in shareholder return exceeds seven (7) percent (referred to herein as
the "Target Percent") (as measured by the performance graph of the Company
shown in the Form 10-K as required by Item 402 of Regulation S-K) for any
fiscal year ending:
(1) at least two years but not later than four years after
the Initial Grant Date, and if the Qualified Director is
still serving as a director of the Company at that time,
then the Qualified Director shall receive an additional
10,000 Options (the date of the receipt of such Options
shall be referred to as the "Second Grant Date"); and
(2) at least four years but not later than six years after
the Initial Grant Date, and if the Qualified Director is
serving as a director of the Company at that time, then
the Qualified Director shall receive an additional
10,000 Options (the date of receipt of such Options
shall be referred to as the "Third Grant Date").
Notwithstanding any language herein to the contrary, if the Company reports a
net operating loss for any fiscal year, any and all Options which have not been
granted shall not be awarded or granted regardless of whether the Company
generates future net operating profits.
(d) Price. With respect to options granted pursuant to Section
3(b), the Option price per Share shall not be less than the fair market value
of the Shares, as defined below, on the Initial Grant Date. With respect to
Options granted pursuant to Section 3(c)(1), the Option price per Share shall
not be less than the fair market value of the Shares, as defined below, on the
first business day that the Company reports a Target Percent in the Form 10-K
filed with the Securities Exchange Commission ("SEC") and a minimum of two
years has passed since the Initial Grant Date. With respect to Options granted
pursuant to Section 3(c)(2), the Option price per Share shall not be less than
the fair market value of the Shares, as defined below, on the first
2
<PAGE> 4
business day that the Company reports a Target Percent in the Form 10-K filed
with the SEC and a minimum of four years has passed since the Initial Grant
Date.
(e) FAIR MARKET VALUE. The fair market value of a Share on any
particular day shall be determined as follows:
(1) If the Shares are listed or admitted to trading on any
security exchange, the fair market value shall be the
low sales price on such day on the New York Stock Exchange,
or if the Shares have not been listed or admitted to trading
on the New York Stock Exchange, on such other securities
exchange on which such stock is then listed or admitted to
trading, or if no sale takes place on such day on any such
exchange, the average of the closing bid and asked price on
such day as officially quoted on any such exchange;
(2) If the Shares are not then listed or admitted to trading on
any securities exchange, the fair market value shall be the
low sales price on such day or, if no sale takes place on
such day, the average of the reported closing bid and asked
price on such date, in the over-the-counter market as
furnished by the National Association of Securities Dealers
Automated Quotations ("NASDAQ"), or if NASDAQ at the time
is not engaged in the business of reporting such prices, as
furnished by any similar firm then engaged in such business
and selected by the Board; or
(3) If the Shares are not then listed or admitted to trading in
the over-the-counter market, the fair market value shall be
the amount determined by the Board in a manner consistent
with Treasury Regulation Section 20-2031-2 promulgated under
the Code or in such other manner prescribed by the Secretary
of the Treasury or the Internal Revenue Service.
(f) DURATION OF PLAN. The term of the Plan, unless previously terminated
by the Board, is ten (10) years commencing on the date of adoption of the Plan
by the Board. No Option shall be granted under the Plan unless granted within
ten (10) years of the adoption of the Plan by the Board, but Options outstanding
on that date shall not be terminated or otherwise affected by virtue of the
Plan's expiration.
(g) VESTING OF THE INITIAL GRANT OPTIONS. Options granted to the
Qualified Directors on the Initial Grant Date shall become exercisable
immediately upon satisfaction of each of the following conditions:
(1) Shareholder approval as required by Section 4(a) of the
Plan has been obtained;
3
<PAGE> 5
(2) A minimum of six (6) months has passed from the date of
shareholder approval, or a minimum of one (1) hear has
passed from the Initial Grant Date, whichever occurs
later; and
(3) The fair market value (as defined by Section 3(b) of the
Plan) of the Shares has increased by three percent from the
Initial Grant Date.
(h) Vesting of Additional Options.
All other Options granted pursuant to the Plan shall become exercisable
(subject to Section 3(j) below) immediately upon satisfaction of the following
conditions:
(1) A minimum of six (6) months has passed from the date the
Option was granted (hereafter the Second Grant Date and the
Third Grant Date shall be generally referred to as the
"Additional Grant Date:); and
(2) The fair market value (as defined by Section 4(a) of the
Plan) of the Shares has increased by seven (7) percent from
the Additional Grant Date.
(i) Allotment. Each Original Director shall receive 40,000 Options
on the Initial Grant Date, 10,000 Options on the Second Grant Date, and 10,000
Options on the Third Grant Date. Each New Director shall receive 10,000
Options on the Initial Grant Date, 10,000 Options on the Second Grant Date, and
10,000 Options on the Third Grant Date.
(j) Additional Restrictions on Option Exercise. A Qualified Director
may only exercise Options during the period beginning on the
third business day and ending on the twenty-third business day
following the release for publication of quarterly or annual
summary statements of sales and earnings. This condition shall
be deemed to be satisfied if the specified financial data
appears:
(1) On a wire service;
(2) A financial news service;
(3) In a newspaper of general circulation, or
(4) Is otherwise made publicly available, and shall remain in
effect so long as it does not violate the law or any rule
or regulation adopted by the appropriate governmental
authority.
4
<PAGE> 6
4. Terms and Conditions of Options.
(a) Approval by Shareholders. The Plan shall be submitted to the
shareholders of the Company for their approval at their regular meeting to be
held within twelve (12) months after the adoption of the Plan by the Board.
Shareholder approval shall be evidenced by the affirmative vote of the holders
of a majority of the Shares of Common Stock present in person or by proxy and
voting at the meeting. If the shareholders decline to approve the Plan at such
meeting or if the Plan is not approved by the shareholders within twelve (12)
months after its adoption by the Board, the Plan and all Options and rights
granted hereunder shall automatically terminate to the same extent and with the
same effect as through the Plan had never been adopted.
(b) Amendments to Plan. Without the approval of the shareholders of
the Company, the Board shall not (i) increase the aggregate number of shares of
Common Stock subject to the Plan; (ii) change the class of persons eligible to
receive Options; (iii) modify the period within which Options may be granted,
the exercise price or the terms upon which Options may be exercised, or (iv)
increase the material benefits accruing to participants under the Plan.
(Collectively, each of these changes in the Plan are referred to herein as
"Material Amendments.") Notwithstanding any other terms contained herein to the
contrary, no Material Amendments shall be made to the Plan more than one time
in any given one year period. The Board, however, may suspend or terminate the
Plan at any time.
(c) Individual Agreements. Options granted under the Plan shall be
evidenced by agreements in such form as the Board from time to time approves,
which agreements shall substantially comply with and be subject to the terms of
the Plan.
(d) No Fractional Shares. Options shall be granted and exercisable
only for whole shares; no fractional shares will be issuable upon exercise of
any Option granted under the Plan.
(e) Method of Exercising Option. Options shall be exercised by
written notice to the Company, addressed to the Company at its principal place
of business. Such notice shall state the election to exercise the option and
the number of shares with respect to which it is being exercised, and shall be
signed by the person exercising the option. Such notice shall be accompanied by
payment in full of the exercise price for the number of Shares being purchased.
Payment may be made in cash or by bank cashier's check or by tendering duly
endorsed certificates for shares of the Company's Common Stock then owned by the
optionholder. The Company shall deliver a certificate or certificates
representing the Option Shares to the purchaser as soon as practicable after
payment for those Shares has been received. If an Option is exercised by any
person other than the optionholder, such notice shall be accompanied by
appropriate proof of the right of such person to exercise the Option. All
Shares that are purchased and paid for in full upon the exercise of an Option
shall be fully paid and non-assessable. The Board may determine that payment
upon the exercise of an Option may be made with Shares owned by the Qualified
Director having a fair market value on the exercise date equivalent to the
amount of payment, or any combination of cash and such Shares equal to such
amount.
5
<PAGE> 7
(f) No Rights of a Shareholder. An optionholder shall have no
rights as a shareholder with respect to shares covered by an option. No
adjustment will be made for cash dividends for which the record date is prior
to the date a stock certificate is issued upon exercise of an Option. Upon such
exercise of an Option, the holder of the Shares of Common Stock so received
shall have all rights of a shareholder of the Company as of the date of
issuance.
(g) Compliance with Law. No Shares shall be issued or transferred
upon the exercise of any Option unless and until the following occurs:
(1) All legal requirements applicable to the issuance or
transfer of Shares have been complied with; and
(2) All requirements of any national securities exchange or
association upon which the Shares are listed, traded or
quoted have been met, in each case to the satisfaction
of the Board. The Board shall have the right to
condition the issuance of any Shares made to any person
hereunder on such person's undertaking in writing to
comply with such restrictions on his or her subsequent
disposition of such Shares as the Board shall deem
necessary or advisable as a result of any applicable
law, regulation or official interpretation thereof, and
certificates representing such shares may be legended to
reflect any such restriction.
5. Termination of Employment; Assignability; Death.
------------------------------------------------
(a) Termination of Employment. If any optionholder ceases to be a
Director of the Company other than for death, disability or discharge for
cause, such holder (or its successors in the case of the holder's death after
the termination or directorship) may, within three months after the date of
termination, but in no event after the stated expiration date, purchase some or
all of the Shares with respect to which such optionholder was entitled to
exercise such Option, on the date such directorship terminated; provided, that
(i) if the holder's directorship is terminated for dishonesty or other acts
detrimental to the Company's interests or for the holder's breach of any
employment, confidentiality or other contract or agreement with the Company, or
(ii) if after directorship is terminated, the holder commits acts detrimental
to the Company's interests, then the Option shall thereafter be void for all
purposes.
(b) Assignability. No Option or the privileges conferred thereby
shall be assignable or transferable by a holder other than by will or the laws
of descent and distribution, and such Option shall be exercisable by such
holder during the lifetime of the holder only.
(c) Disability. If the optionholder is removed as a director due
to disability, the optionholder may exercise the Options, in whole or in part,
to the extent they were exercisable on the date when the optionholder's
directorship terminated, at any time prior to the expiration date of the
Options or within one year of the date of removal, whichever is earlier.
6
<PAGE> 8
(d) Discharge for Cause. If an optionholder is removed as a director of
the Company for cause, the Options shall terminate upon receipt by the
optionholder of notice of such removal or on the effective date of the removal,
whichever is earlier. The Board shall have the right to determine whether the
optionholder has been discharged for cause for purposes of the Plan and the date
of such discharge.
(e) Death of Holder. If optionholder dies while serving as a director,
an Option shall be exercisable until the stated expiration date thereof by the
person or persons ("successors") to whom the holder's rights pass under will or
by the laws of descent and distribution, but only to the extent that the holder
was entitled to exercise the Option at the date of death. An option may be
exercised (and payment of the option price made in full) by the successors only
after written notice to the Company, specifying the number of shares to be
purchased. Such notice shall comply with the provisions of Section 4(e).
6. Certain Adjustments.
(a) Capital Adjustments. Except as limited by Section 422 of the Code,
the aggregate number of Shares subject to the Plan, the number of Shares
covered by outstanding Options, and the price per share stated in such Options
shall be proportionately adjusted for any increase or decrease in the number of
outstanding shares of Common Stock of the Company resulting from a subdivision
or consolidation of shares or any other capital adjustment or the payment of a
stock dividend or any other increase or decrease in the number of such shares
effected without receipt by the Company of consideration therefor in money,
services or property.
(b) Mergers, Etc. Except as limited by the provisions of Section 422 of
the Code, if the Company is the surviving corporation in any merger or
consolidation, any Option granted under the Plan shall pertain to and apply to
the securities to which a holder of the number of Shares subject to the Option
would have been entitled. A dissolution or liquidation of the Company shall
cause every Option outstanding hereunder to terminate, unless specifically
provided otherwise by the Board. A merger or consolidation in which the Company
is not the surviving corporation shall also cause every option outstanding
hereunder to terminate, unless specifically provided otherwise by the Board, but
each holder shall have the right immediately prior to a merger or consolidation
in which the Company is not the surviving corporation, to exercise such Option
in whole or in part without regard to any installment provisions contained in
the Option agreement.
7. Delivery of Stock; Legends; Representations.
(a) Legend on Certificates. All certificates representing shares of
Common Stock issued upon exercise of options granted under the Plan shall be
endorsed with a legend reading as follows:
The shares of Common Stock evidenced by this certificate have
been issued to the registered owner in reliance upon written
representations that these
7
<PAGE> 9
shares have been purchased solely for investment. These shares may not
be sold, transferred or assigned unless in the opinion of the Company
and its legal counsel such sale, transfer or assignment will not be in
violation of the Securities Act of 1933, as amended, and the Rules and
Regulations thereunder.
(b) Private Offering for Investment Only. The options are and
shall be made available only to persons who have knowledge of the Company's
financial condition, management and its affairs. The Plan is not intended to
provide additional capital for the Company, but to encourage stock ownership
among the Company's Qualified Directors. By the act of accepting an option,
each optionholder agrees (i) that, if he or his successors exercise his option,
he or his successors will purchase the subject shares solely for investment and
not with any intention at such time to resell or redistribute those shares.
8. Miscellaneous.
-------------
(a) No Funding. This Plan shall be unfunded. The Company shall not
be required to establish any special or separate fund or to make any other
segregation of assets to assure any payment under the Plan.
(b) New Mexico Law. The Plan and the Options shall be governed by
the laws of the State of New Mexico.
DATED this 9th day of March, 1993.
MESA AIRLINES, INC.
By: /s/ Blaine M. Jones
-------------------------
Blaine M. Jones,
Chief Financial Officer
ATTESTED BY:
By: /s/ Gary E. Risley
------------------------
Secretary
8
<PAGE> 1
EXHIBIT 4.2
AMENDMENT TO MESA AIRLINES, INC.
OUTSIDE DIRECTORS' STOCK OPTION PLAN
<PAGE> 2
EXHIBIT 4.2
AMENDMENT TO MESA AIRLINES, INC.
OUTSIDE DIRECTORS' STOCK OPTION PLAN
This Amendment to Mesa Airlines, Inc. Outside Directors Stock Option
Plan ("the Amendment") is entered into on January 12, 1994 for the purpose of
amending Mesa Airlines, Inc. Outside Directors' Stock Option Plan dated March 9,
1993 ("the Plan").
RECITALS:
A. The Company recognizes that occurrence of certain events could
delay the granting of additional options or the vesting of previously approved
options when such granting or vesting should equitably occur in accordance with
the intent of the Plan.
B. The Board of Directors has approved this Amendment to the Plan to
cover those contingent events so that outside directors who are serving as
members of the Board of Directors of Mesa Airlines, Inc. (the "Company") shall
receive options when shareholder return increases at the rate and within the
time period set forth in the Plan regardless of whether events occur which are
beyond the control of the outside directors.
AMENDMENTS:
The Plan is hereby amended as follows:
1. Section 3(c) is amended in its entirety to read as
follows:
"(c) Criteria for Additional Grants.
(1) Each Qualified Director shall receive a grant of an
additional 10,000 options ("Second Grant") if: the
Qualified Director is still serving as a director of the
Company on the date of the Second Grant; and either the
annual percentage increase in shareholder return: (i)
exceeds seven percent for any fiscal year within four
years after the Initial Grant Date ("the Target
Percent") (provided that the effective date of the
Second Grant shall be delayed until the second
anniversary of the Initial Grant Date if the Target
Percent is achieved during the first two fiscal years
following the Initial Grant date), or (ii) exceeds an
aggregate of 10% for any two consecutive fiscal year
period within four years after the initial Grant Date
("the Alternative Target Percent").
(2) Each Qualified Director shall receive a grant of an
additional 10,000 options ("the Third Grant") if the
Qualified Director is still serving as a director of the
Company on the date of the Third Grant; and either the
annual percentage increase in shareholder return: (i)
exceeds seven percent for any fiscal year within six
years after the Initial Grant Date ("the Additional
Target Percent") (provided that the effective date of
the Third Grant shall be delayed until the fourth
anniversary of the Initial
<PAGE> 3
Grant Date if the Additional Target Percent is achieved
in the first four fiscal years following the Initial
Grant Date) or (ii) exceeds an aggregate of 10% for any
two consecutive fiscal year period within six years
after the Initial Grant Date ("the Additional
Alternative Target percent").
Notwithstanding any language herein to the contrary, if
the Company reports a net operating loss for any fiscal
year, any and all options which have not been granted
shall not be awarded or granted regardless of whether
the Company generates future net operating profits."
2. Section 3(d) of the Plan is amended in its entirety as
follows:
"(d) Price. With respect to options granted on the
Initial Grant Date, the exercise price of the options may not
be less than the fair market value of the Common Stock on the
date of the grant. With respect to options granted on the
second Grant Date, the exercise price of the options may not
be less than the fair market value of the shares on the last
business day of the fiscal year that the Company achieves the
Target Percent or the Alternative Target Percent. With respect
to options granted on the Third Grant Date, the exercise price
of the options may not be less than the fair market value of
the shares as of the last business day of the fiscal year that
the Company achieves the Additional Target Percent or the
Additional Alternative Target Percent."
Executed as of March 8, 1994.
ATTEST:
By /s/ Gary E. Risley
---------------------------
Gary E. Risley, Secretary
MESA AIRLINES, INC.
By /s/ Blaine M. Jones
-----------------------------------------
Blaine M. Jones, Chief Financial Officer
<PAGE> 1
EXHIBIT 4.3
SECOND AMENDMENT TO MESA AIRLINES, INC.
OUTSIDE DIRECTORS' STOCK OPTION PLAN
<PAGE> 2
EXHIBIT 4.3
SECOND AMENDMENT TO MESA AIRLINES, INC.
OUTSIDE DIRECTORS' STOCK OPTION PLAN
This Second Amendment to the Mesa Airlines, Inc. Outside Directors'
Stock Option Plan ("the Second Amendment") is adopted effective as of April 9,
1996, for the purpose of amending the Mesa Airlines, Inc. Outside Directors
Stock Option Plan dated March 9, 1993, as amended on January 12, 1994 ("the
Plan").
RECITALS:
A. The Board of Directors has adopted and the shareholders have
approved an amended Employee Stock Option Plan (the "Employee Plan") as a part
of the "Omnibus Plan" described in the Company's Proxy Statement dated February
26, 1996.
B. The Board of Directors has determined that it is in the best
interest of Mesa Air Group, Inc. formerly Mesa Airlines, Inc., (the "Company")
and its shareholders to reduce the total Options which may be granted under the
provisions of the Mesa Airlines, Inc. Outside Directors' Stock Option Plan, as
amended.
AMENDMENT:
Paragraph 2(a) of the Plan is hereby amended as follows:
(a) Description of Stock and Maximum Shares Allocated.
The stock subject to the provisions of this Plan and issuable upon
exercise of the Options are shares of the Company's Common Stock, no
par value, which may be either unissued or treasury shares, as the
Board may from time to time determine. Heretofore, Options to
purchase 100,000 shares of Common Stock have been granted under the
Plan. Subject to adjustment as provided in Section 6, the Aggregate
number of shares of Common Stock covered by the Plan which may
hereafter be granted under the Plan shall be reduced to 110,000
shares, which shares shall be reserved for use upon the exercise of
the Options. The shares available for Options and all other shares
of Common Stock of the Company shall be referred to as the "Shares."
<PAGE> 3
IN WITNESS WHEREOF this Second Amendment has been executed as of the
9th day of April, 1996.
MESA AIR GROUP, INC.
By: /s/ J. Clark Stevens
__________________________________
Its: President
ATTEST: /s/ Gary E. Risley
_________________________________
Gary E. Risley, Secretary
<PAGE> 1
EXHIBIT 4.4
FORM OF NON-QUALIFIED STOCK OPTION
ISSUED UNDER MESA AIRLINES, INC.
OUTSIDE DIRECTORS' STOCK OPTION PLAN
<PAGE> 2
EXHIBIT 4.4
MESA AIRLINES, INC.
NON-QUALIFIED STOCK OPTION
ISSUED UNDER MESA AIRLINES, INC.
OUTSIDE DIRECTORS' STOCK OPTION PLAN
1. Grant of Option. Mesa Airlines, Inc., a New Mexico corporation
and its subsidiaries (the "Company"), subject to the terms and conditions of
this instrument and to the terms and conditions of the Mesa Airlines, Inc.
Outside Directors' Stock Option Plan, as amended (the "Plan"), a copy of which
the Grantee hereby acknowledges receiving, grants to
____________________________ (the "Grantee") an option to purchase from the
Company an aggregate of _______________ shares of the Company's common stock, no
par value per share (the "Option Shares"), at a price of $__________ per share.
This option is not to be treated as an incentive stock option under Section_422
of the Internal Revenue Code of 1986.
2. Subject to Shareholder Approval. The Option Shares have been
issued pursuant to the terms and conditions of the Plan. The Plan requires
approval by a majority of the securities of the Company which are present or
represented and entitled to vote ("Majority Approval") at a meeting duly held in
accordance with the laws of the State of Arizona. If Majority Approval is not
obtained by March_9, 1994, the Option Shares shall be revoked and declared null
and void.
3. Expiration of Option. This option is granted on that date
determined pursuant to the terms of the formula established by the Plan (the
"Initial Grant Date"). Unless exercised or terminated earlier in accordance with
the provisions hereof, this option will expire at 5:00 p.m. local time on the
day preceding the fifth anniversary of the Initial Grant Date.
4. When Option Exercisable. Grantee's right to exercise this option
shall vest when:
(a) A minimum of six (6) months has passed from the date of
shareholder approval, or a minimum of one (1) year has passed from the
Initial Grant Date, whichever occurs later; and
(b) The fair market value (as defined by Section_3(b) of the
Plan) of the Shares has increased by three percent from the Initial
Grant Date (the "Vesting Date").
The Grantee may exercise this option, in whole or in part, at any time on
or after the Vesting Date but prior to the expiration pursuant to Paragraph_2 or
termination pursuant to Paragraph_7 of this option.
5. Continuous Service a Requisite. Except as otherwise specifically
provided in this paragraph, this option may not be exercised unless the Grantee
is a member
<PAGE> 3
of the Board of Directors (the "Board") continuously from the Initial Grant Date
to the date of exercise. If the Grantee is removed or resigns from the Board of
the Company other than for death, disability or discharge for cause, the Grantee
may exercise this option, in whole or in part, to the extent it was exercisable
on the date when the Grantee terminated his service on the Board, at any time
prior to the expiration date of the option or within three months of the date of
termination of his service on the Board, whichever is earlier; provided that (i)
if the holder's directorship is terminated for dishonesty or other acts
detrimental to the Company's interests, or (ii) if after directorship is
terminated, the holder commits acts detrimental to the Company's interests, then
the Option shall thereafter be void for all purposes.
If the service of the Grantee on the Board is terminated due to disability,
as determined by the Company, the Grantee may exercise this option, in whole or
in part, to the extent it was exercisable on the date when the Grantee's service
on the Board terminated, at any time prior to the expiration date of the option
or within one year of the date of termination of service, whichever is earlier.
If the service of the Grantee on the Board is removed due to discharge for
cause, as determined by the Company, this option shall terminate upon receipt by
the Grantee of notice of such removal or the effective date of the removal,
whichever is earlier.
If the service of the Grantee on the board is terminated on account of
death of the Grantee, the person or persons to whom the Grantee's rights under
the option pass by will or by applicable laws of descent and distribution may
exercise the option, in whole or in part, to the extent it was exercisable on
the date when the Grantee's service terminated, at any time prior to the
expiration date of the option or within one year after the date of the death of
the Grantee, whichever is earlier. The person or persons to whom the Grantee's
rights under the option pass shall be considered the Grantee.
6. Option Not Assignable. This option shall only be transferable by
will or the laws of descent and distribution, or pursuant to a qualified
domestic relations order as defined by the Internal Revenue Code of 1986, as
amended, or Title I of the Employee Retirement Income Security Act or the rules
thereunder. It may be exercised, during the life of the Grantee, only by the
Grantee, and may not be pledged or hypothecated in any way. Additionally, it
shall not be subject to execution, attachment or similar process.
7. Termination of Option. This option shall terminate and all rights
of the Grantee shall cease at the earliest of the following:
(a) 5:00 p.m., local time, of the day before the end of the three
month period following the termination of the Grantee's service on the
Board for any reason other than death, disability or discharge for
cause;
(b) 5:00 p.m., local time, of the day before the end of the one
year period following the termination of the Grantee's service on the
Board due to disability;
<PAGE> 4
(c) The earlier of 5:00 p.m., local time, of the effective date
of the Grantee's termination of service on the Board for cause or
receipt by the Grantee of notice of termination for cause;
(d) 5:00 p.m., local time, on the day before the end of the one
year period following the Grantee's death if the Grantee's service on
the Board is terminated by death; and
(e) Expiration of this option as provided in Paragraph_2.
8. Exercise of Option. This option may be exercised by presenting a
written notice to the Company that the option is being exercised. Such notice
shall identify this option, state the number of Option Shares exercised, and
shall be signed by the Grantee. Payment in full for the Option Shares to be
purchased shall accompany the notice of exercise. Such payment shall be by bank
cashier's check or certified check or with shares of the Company already owned
by the Grantee having a fair market value on the date of exercise equivalent to
the amount that would otherwise be payable, or any combination of cash and such
shares equivalent to such amount. Any representation required by paragraph_10
shall also accompany the notice of exercise.
The fair market value of a share of the Company on any particular date
shall mean fair market value as determined under Section_3(e) of the Plan. If
the Grantee is deceased, or if the Grantee is disabled, the notice of exercise
may be signed by the Grantee's legal representatives or heirs, and shall be
accompanied by evidence satisfactory to the Company of the right of such person
or persons to exercise this option. The Grantee shall have none of the rights of
a shareholder with respect to any of the Option Shares until the Option Shares
are actually issued.
9. Recapitalization, Reorganization, Dissolution. This option shall
not affect in any way the right or power of the Company or its shareholders to
make or authorize any merger, consolidation, recapitalization, reorganization or
dissolution of the Company or any other corporate act or proceeding whether of a
similar character or otherwise. In the event of any change in the Option Shares
through reorganization, recapitalization, stock split, stock dividend,
continuation of shares, merger, consolidation, rights offering, or any other
change in the corporate structure, appropriate adjustments shall be made by the
Board in the number and kind of shares and the price per share subject to this
option. The determination of the board on whether any adjustment is required and
the extent and nature of any such adjustment shall be final and binding upon all
persons. Upon a determination by the Board of any adjustment in the number of
Option Shares or of the option price, this option shall be amended in accordance
with the action of the Board.
10. Service May be Terminated. The granting of this option shall not
confer upon the Grantee any right to continue in the service on the Board of
Directors and shall not interfere in any way with the right of the Company, with
or without cause, to terminate the Grantee's directorship at any time.
<PAGE> 5
11. Compliance With Legal Requirements. If, at the time of exercise
of this option, there is not in effect as to the Option Shares being purchased a
registration statement under the Securities Act of 1933, as amended (or any
successor statute) (collectively the "1933 Act), then the exercise of this
option shall be effective only upon receipt by the Company from the Grantee (or
his legal representatives or heirs) of a written representation that the Option
Shares are being purchased for investment and not for distribution.
The Company may request an opinion of its counsel as to whether
registration of the Option Shares being purchased is required under the 1933 Act
or under applicable state statutes and regulations. If counsel is of the opinion
that such registration is not required, the Company shall issue the Option
Shares. If counsel is of the opinion that such registration is required, the
Company shall not be required to issue the Option Shares until they have been so
registered, but the Company shall be under no obligation to register the Option
Shares.
The Grantee hereby agrees to supply the Company with such information and
to cooperate with the Company, as the Company may reasonably request, in
connection with the preparation and filing of the registration statements and
amendments thereto under the 1933 Act and applicable state statutes and
regulations applicable to the Option Shares. The Company shall not be liable for
failure to issue any such Option Shares where such opinion of counsel cannot be
obtained within the period specified for the exercise of the option, or where
such registration is required in the opinion of counsel. If shares of common
stock of the Company are, at the time of the exercise of this option, listed
upon a securities exchange, the exercise of this option shall be contingent upon
completion of the necessary steps to list the Option Shares being purchased upon
such securities exchange.
Furthermore, this option may only be exercised during the period beginning
on the third business day and ending on the twenty-fifth business day following
the release for publication of quarterly or annual summary statements of sales
and earnings.
12. Additional Powers of Board. The Board may construe this option
and correct any defect, supply any omission or reconcile any inconsistency in
this instrument or in the Plan as the Board may deem appropriate. The Board
shall determine any dispute that may arise under this option. All decisions of
the Board under this or any other provision of this option and under the Plan
shall be binding and conclusive on the Grantee, his or her spouse, legal
representatives and heirs.
13. Governing Law. This Instrument shall be governed by the laws of
the State of New Mexico.
<PAGE> 6
IN WITNESS WHEREOF, the Company has caused this option to be
executed by a duly authorized officer and its corporate seal to be affixed as of
the Initial Grant Date set forth in Paragraph 2.
MESA AIRLINES, INC.
By________________________________________
Its_______________________________________
(SEAL)
Attest:
___________________________________
I hereby acknowledge that I have received a copy of Mesa Airlines,
Inc. Outside Directors' Stock Option Plan.
__________________________________________
Grantee
<PAGE> 1
EXHIBIT 4.5
MESA AIRLINES, INC.
ADDITIONAL OUTSIDE DIRECTORS'
STOCK OPTION PLAN
<PAGE> 2
EXHIBIT 4.5
MESA AIRLINES, INC.
ADDITIONAL OUTSIDE DIRECTORS' STOCK OPTION PLAN
1. PURPOSE OF THE PLAN; TYPE OF PLAN
(a) Attract and Retain Talented Outside Directors. The purpose of
the Mesa Airlines, Inc. Additional Outside Directors' Stock Option Plan (the
"Plan") is to attract and retain outside directors ("Qualified Directors") who
are and will be responsible for the growth and success of Mesa Airlines, Inc., a
New Mexico corporation (the "Company"), and its subsidiaries by providing an
incentive-based form of compensation to the Qualified Directors and encouraging
such Qualified Directors to invest in shares of the Company's Common Stock to
increase the Qualified Directors' personal interest in the continued success and
profitability of the Company. Although the formula plan enacted in early 1993
(the "1993 Formula Plan") was instituted to achieve similar purposes, the
increasing competition for talented directors caused by a favorable economic
climate for start-up commuter and regional airlines coupled with the decline in
the Company's stock has indefinitely delayed the vesting of previously granted
options and granting of future options.
(b) Designation of Stock Options as Non-Qualified Stock Options.
Stock options granted under the Plan (the "Options") shall not be treated as
incentive stock options under Section 422 of the Internal Revenue Code of 1986,
as amended (the "Code").
(c) Exemption from Short-Swing Liability. Options granted to
Qualified Directors of the Company pursuant to this Plan shall be exempt from
Section 16(b) of the Securities Exchange Act of 1934, as amended (the "Exchange
Act") pursuant to Regulation 240.16(b)-3 adopted under the Exchange Act on May
1, 1991.
(d) Formula Plan. This Plan may be administered by the Board of
Directors of the Company (the "Board") or by any person or persons chosen by a
majority of the Board. Grants or awards made pursuant to this Plan are to be
made pursuant to the formula set forth in Section 3 (the "Formula"). The Formula
is intended to qualify under Regulation 240.16b-3(c)(2)(ii) of the Exchange
Act, thereby alleviating the necessity for disinterested administration of the
Plan required by Regulation 240.16b-3(c)(2)(i).
2. STOCK AND MAXIMUM NUMBER OF SHARES SUBJECT TO PLAN
(a) Description of Stock and Maximum Shares Allocated. The stock
subject to the provisions of this Plan and issuable upon exercise of the Options
are shares of the Company's Common Stock, no par value, which may be either
unissued or treasury shares, as the Board may from time to time determine.
Subject to adjustment as provided in Section 6, the aggregate number of shares
of Common Stock covered by the Plan issuable upon exercise of all Options shall
be 50,000 shares, which shares shall be reserved for use upon the exercise of
the Options. The shares available for Options and all other shares of Common
Stock of the Company shall be referred to as the "Shares".
<PAGE> 3
(b) Restoration of Unpurchased Shares. If an Option expires or
terminates for any reason prior to the exercise in full before the term of the
Plan expires, the Shares subject to, but not issued under, such Option shall
again be available for other Options hereafter granted.
3. FORMULA AND OPERATION OF THE PLAN
(a) Eligible Persons. Options will automatically be granted to all
present and future directors of the Company who are not employees of the Company
or of any subsidiary of the Company ("Qualified Directors").
(b) Date of Grants; Allocation. Each Qualified Director shall
receive 3,000 options to purchase 3,000 shares of Common Stock, no par value, on
December 9, 1994 or, if appointed to the Board of Directors after December 9,
1994, on the first business day after being appointed as a member of the Board
of Directors. Each Qualified Director shall receive an additional 3,000 options
to purchase 3,000 shares of Common Stock, no par value, on December 11, 1995 and
an additional 3,000 Options to purchase 3,000 shares of Common Stock on December
11, 1996.
(c) Price. The Option price per Share shall not be less than the
fair market value of the Shares, as defined below, on the Grant Date.
(d) Fair Market Value. The fair market value of a Share on any
particular day shall be determined as follows:
(1) If the Shares are listed or admitted to trading on any
security exchange, the fair market value shall be the
low sales price on such day on the New York Stock
Exchange, or if the Shares have not been listed or
admitted to trading on the New York Stock Exchange, on
such other securities exchange on which such stock is
then listed or admitted to trading, or if no sale takes
place on such day on any such exchange, the average of
the closing bid and asked price on such day as
officially quoted on any such exchange;
(2) If the Shares are not then listed or admitted to
trading on any securities exchange, the fair market
value shall be the low sales price on such day or, if
no sale takes place on such day, the average of the
reported closing bid and asked price on such date, in
the over-the-counter market as furnished by the
National Association of Securities Dealers Automated
Quotation ("NASDAQ"), or if NASDAQ at the time is not
engaged in the business of reporting such prices, as
furnished by any similar firm then engaged in such
business and selected by the Board; or
(3) If the Shares are not then listed or admitted to
trading in the over-the-counter market, the fair market
value shall be the amount determined by the Board in a
manner consistent with Treasury Regulation Section 20-
-2-
<PAGE> 4
2031-2 promulgated under the Code or in such other
manner prescribed by the Secretary of the Treasury or
the Internal Revenue Service.
(e) Duration of Plan. The term of the Plan, unless previously
terminated by the Board, is ten (10) years commencing on the date of adoption of
the Plan by the Board. No Option shall be granted under the Plan unless granted
within ten (10) years of the adoption of the Plan by the Board, but Options
outstanding on that date shall not be terminated or otherwise affected by virtue
of the Plan's expiration.
(f) Vesting of the Options. Options granted to the Qualified
Directors shall become exercisable immediately upon satisfaction of each of the
following conditions:
(1) Shareholder approval as required by Section 4(a) of the
Plan has been obtained; and
(2) A minimum of six (6) months has passed from the date of
the shareholder approval, or a minimum of one (1) year
has passed from the Grant Date, whichever occurs later.
(g) Additional Restrictions on Option Exercise. A Qualified Director
may only exercise Options during the period beginning on the third business day
and ending on the twenty-third business day following the release for
publication of quarterly or annual summary statements of sales and earnings.
This condition shall be deemed to be satisfied if the specified financial data
appears:
(1) On a wire service;
(2) A financial news service;
(3) In a newspaper of general circulation; and
(4) Is otherwise made publicly available, and shall remain
in effect so long as it does not violate the law or any
rule or regulation adopted by the appropriate
governmental authority.
4. TERMS AND CONDITIONS OF OPTIONS
(a) Approval by Shareholders. The Plan shall be submitted to the
shareholders of the Company for their approval at their regular meeting to be
held within twelve (12) months after the adoption of the Plan by the Board.
Shareholder approval shall be evidenced by the affirmative vote of the holders
of a majority of the Shares of Common Stock present in person or by proxy and
voting at the meeting. If the shareholders decline to approve the Plan at such
meeting or if the Plan is not approved by the shareholders within twelve (12)
months after its adoption by the Board, the Plan and all Options and rights
granted hereunder shall automatically terminate to the same extent and with the
same effect as though the Plan had never been adopted.
-3-
<PAGE> 5
(b) Amendments to Plan. Without the approval of the shareholders of
the Company, the Board shall not (i) increase the aggregate number of shares of
Common Stock subject to the Plan; (ii) change the class of persons eligible to
receive Options; (iii) modify the period within which Options may be granted,
the exercise price or the terms upon which Options may be exercised, or (iv)
increase the material benefits accruing to participants under the Plan.
(Collectively, each of these changes in the Plan are referred to herein as
"Material Amendments.") Notwithstanding any other terms contained herein to the
contrary, no Material Amendments shall be made to the Plan more than one time in
any given one year period. The Board, however, may suspend or terminate the Plan
at any time.
(c) Individual Agreements. Options granted under the Plan shall be
evidenced by agreements in such form as the Board from time to time approves,
which agreements shall substantially comply with and be subject to the terms of
the Plan.
(d) No Fractional Shares. Options shall be granted and exercisable
only for whole shares; no fractional shares will be issuable upon exercise of
any Option granted under the Plan.
(e) Method of Exercising Options. Options shall be exercised by
written notice to the Company, addressed to the Company at its principal place
of business. Such notice shall state the election to exercise the option and the
number of shares with respect to which it is being exercised, and shall be
signed by the person exercising the option. Such notice shall be accompanied by
payment in full of the exercise price for the number of Shares being purchased.
Payment may be made in cash or by bank cashier's check or by tendering duly
endorsed certificates for shares of the Company's Common Stock then owned by the
optionholder. The Company shall deliver a certificate or certificates
representing the Option Shares to the purchaser as soon as practicable after
payment for those Shares has been received. If an Option is exercised by any
person other than the optionholder, such notice shall be accompanied by
appropriate proof of the right of such person to exercise the Option. All Shares
that are purchased and paid for in full upon the exercise of an Option shall be
fully paid and non-assessable. The Board may determine that payment upon the
exercise of an Option may be made with Shares owned by the Qualified Director
having a fair market value on the exercise date equivalent to the amount of
payment, or any combination of cash and such Shares equal to such amount.
(f) No Rights of a Shareholder. An Optionholder shall have no rights
as a shareholder with respect to shares covered by an Option. No adjustment will
be made for cash dividends for which the record date is prior to the date a
stock certificate is issued upon exercise of an Option. Upon such exercise of an
Option, the holder of the Shares of Common Stock so received shall have all the
rights of a shareholder of the Company as of the date of issuance.
(g) Compliance with Law. No Shares shall be issued or transferred
upon the exercise of any Option unless and until the following occurs:
-4-
<PAGE> 6
(1) All legal requirements applicable to the issuance or
transfer of Shares have been complied with; and
(2) All requirements of any national securities exchange or
association upon which the Shares are listed, traded or
quoted have been met, in each case to the satisfaction
of the Board. The Board shall have the right to
condition the issuance of any Shares made to any person
hereunder on such person's undertaking in writing to
comply with such restrictions on his or her subsequent
disposition of such Shares as the Board shall deem
necessary or advisable as a result of any applicable
law, regulation or official interpretation thereof, and
certificates representing such shares may be legended
to reflect any such restriction.
5. TERMINATION OF EMPLOYMENT; ASSIGNABILITY; DEATH
(a) Termination of Employment. If any Optionholder ceases to be a
Director of the Company other than for death, disability or discharge for cause,
such holder (or its successors in the case of the holder's death after the
termination of directorship) may, within three months after the date of
termination, but in no event after the stated expiration date, purchase some or
all of the Shares with respect to which such Optionholder was entitled to
exercise such Option, on the date such directorship terminated; provided, that
(i) if the holder's directorship is terminated for dishonesty or other acts
detrimental to the Company's interests or for the holder's breach of any
employment, confidentiality or other contract or agreement with the Company, or
(ii) if after directorship is terminated, the holder commits acts detrimental to
the Company's interests, then the Option shall thereafter be void for all
purposes.
(b) Assignability. No Option or the privileges conferred thereby
shall be assignable or transferable by a holder other than by will or the laws
of descent and distribution, and such Option shall be exercisable by such holder
during the lifetime of the holder only.
(c) Disability. If the Optionholder is removed as a director due to
disability, the Optionholder may exercise the Options, in whole or in part, to
the extent they were exercisable on the date when the Optionholder's
directorship terminated, at any time prior to the expiration date of the Options
or within one year of the date of removal, whichever is earlier.
(d) Discharge for Cause. If an Optionholder is removed as a director
of the Company for cause, the Options shall terminate upon receipt by the
Optionholder of a notice of such removal or on the effective date of the
removal, whichever is earlier. The Board shall have the right to determine
whether the optionholder has been discharged for cause for purposes of the Plan
and the date of such discharge.
(e) Death of Holder. If Optionholder dies while serving as a
director, an Option shall be exercisable until the stated expiration date
thereof by the person or persons ("successors") to whom the holder's rights pass
under will or by the laws of descent and
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<PAGE> 7
distribution, but only to the extent that the holder was entitled to exercise
the Option at the date of death. An Option may be exercised (and payment of the
option price made in full) by the successors only after written notice to the
Company, specifying the number of shares to be purchased. Such notice shall
comply with the provisions of Section 4(e).
6. CERTAIN ADJUSTMENTS
(a) Capital Adjustments. Except as limited by Section 422 of the
Code, the aggregate number of Shares subject to the Plan, the number of Shares
covered by outstanding Options, and the price per share stated in such Options
shall be proportionately adjusted for any increase or decrease in the number of
outstanding Shares of Common Stock of the Company resulting from a subdivision
or consolidation of shares or any other capital adjustment or the payment of a
stock dividend or any other increase or decrease in the number of such shares
effected without receipt by the Company of consideration therefor in money,
services or property.
(b) Mergers, Etc. Except as limited by the provisions of Section 422
of the Code, if the Company is the surviving corporation in any merger or
consolidation, any Option granted under the Plan shall pertain to and apply to
the securities to which a holder of the number of Shares subject to the Option
would have been entitled. A dissolution or liquidation of the Company shall
cause every Option outstanding hereunder to terminate, unless specifically
provided otherwise by the Board. A merger or consolidation in which the Company
is not the surviving corporation shall also cause every Option outstanding
hereunder to terminate, unless specifically provided otherwise by the Board, but
each holder shall have the right immediately prior to a merger or consolidation
in which the Company is not the surviving corporation, to exercise such Option
in whole or in part without regard to any installment provisions contained in
the Option agreement.
7. DELIVERY OF STOCK; LEGENDS; REPRESENTATIONS
(a) Legend on Certificates. All certificates representing shares of
Common Stock issued upon exercise of options granted under the Plan shall be
endorsed with a legend reading as follows:
THE SHARES OF COMMON STOCK EVIDENCED BY THIS CERTIFICATE HAVE
BEEN ISSUED TO THE REGISTERED OWNER IN RELIANCE UPON WRITTEN
REPRESENTATIONS THAT THESE SHARES HAVE BEEN PURCHASED SOLELY FOR
INVESTMENT. THESE SHARES MAY NOT BE SOLD, TRANSFERRED OR ASSIGNED
UNLESS IN THE OPINION OF THE COMPANY AND ITS LEGAL COUNSEL SUCH
SALE, TRANSFER OR ASSIGNMENT WILL NOT BE IN VIOLATION OF THE
SECURITIES ACT OF 1933, AS AMENDED, AND THE RULES AND REGULATIONS
THEREUNDER.
(b) Private Offering for Investment Only. The Options are and shall
be made available only to persons who have knowledge of the Company's financial
condition, management and its affairs. The Plan is not intended to provide
additional capital for the Company, but to encourage stock ownership among the
Company's Qualified Directors. By
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<PAGE> 8
the act of accepting an Option, each Optionholder agrees (i) that, if he or his
successors exercise his Option, he or his successors will purchase the subject
shares solely for investment and not with any intention at such time to resell
or redistribute those shares.
8. MISCELLANEOUS
(a) No Funding. This Plan shall be unfunded. The Company shall not
be required to establish any special or separate fund or to make any other
segregation of assets to assure any payment under the Plan.
(b) New Mexico Law. The Plan and the Options shall be governed by
the laws of the State of New Mexico.
DATED as of the 9th day of December, 1994.
MESA AIRLINES, INC.
By /s/ W. Stephen Jackson
----------------------------
W. Stephen Jackson
Chief Financial Officer
ATTESTED BY:
By: /s/ Gary E. Risley
--------------------------
Secretary
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<PAGE> 1
EXHIBIT 4.6
MESA AIRLINES, INC.
NON-QUALIFIED STOCK OPTION
ISSUED UNDER MESA AIRLINES, INC.
ADDITIONAL OUTSIDE DIRECTORS' STOCK OPTION PLAN
<PAGE> 2
EXHIBIT 4.6
MESA AIR GROUP, INC.
NON-QUALIFIED STOCK OPTION
ISSUED UNDER MESA AIRLINES, INC. ADDITIONAL
OUTSIDE DIRECTORS' STOCK OPTION PLAN
1. GRANT OF OPTION. Mesa Air Group, Inc., a New Mexico corporation
and its subsidiaries (the "Company"), subject to the terms and conditions of
this instrument and to the terms and conditions of the Mesa Airlines, Inc.
Additional Outside Director's Stock Option Plan (the "Plan"), a copy of which
the Grantee hereby acknowledges receiving, grants to _____________ (the
"Grantee") an option to purchase from the Company an aggregate of ______ shares
of the Company's common stock, no par value per share (the "Option Shares"), at
a price of $_____ per share. This Option is not to be treated as an incentive
stock option under Section 422 of the Internal Revenue Code of 1986.
2. DATE OF ISSUE. The Option Shares have been issued pursuant to
the terms and conditions of the Plan as of ________________ (the "Grant Date").
3. EXPIRATION OF OPTION. Unless exercised or terminated earlier in
accordance with the provisions hereof, this option will expire at 5:00 p.m.
local time on the day preceding the fifth anniversary of the Grant Date.
4. WHEN OPTION EXERCISABLE. Grantee's right to exercise this Option
shall vest when a minimum of six (6) months has passed from the date of
shareholder approval, or a minimum of one (1) year has passed from the Grant
Date, whichever occurs later (the "Vesting Date").
The Grantee may exercise this Option, in whole or in part, at any
time on or after the Vesting Date but prior to the expiration pursuant to
Paragraph 3 or termination pursuant to paragraph 7 of this Option.
5. CONTINUOUS SERVICE A REQUISITE. Except as otherwise specifically
provided in this paragraph, this Option may not be exercised unless the Grantee
is a member of the Board of Directors (the "Board") continuously from the Grant
Date to the date of exercise. If the Grantee is removed or resigns from the
Board of the Company other than for death, disability or discharge for cause,
the Grantee may exercise this Option, in whole or in part, to the extent it was
exercisable on the date when the Grantee terminated his service on the Board,
at any time prior to the expiration date of the Option or within three months
of the date of termination of his service on the Board, whichever is earlier;
provided that (i) if the holder's directorship is terminated for dishonesty or
other acts detrimental to the Company's interests, or (ii) if after
directorship is terminated, the holder commits acts detrimental to the
Company's interests, then the Option shall thereafter be void for all purposes.
If the service of the Grantee on the Board is terminated due to
disability, as determined by the Company, the Grantee may exercise this Option,
in whole or in part, to the extent it was exercisable on the date when the
Grantee's service on the Board terminated,
<PAGE> 3
at any time prior to the expiration date of the Option or within one year of the
date of termination of service, whichever is earlier.
If the Grantee is removed from the Board due to discharge for cause,
as determined by the Company, this Option shall terminate upon receipt by the
Grantee of notice of such removal or the effective date of the removal,
whichever is earlier.
If the service of the Grantee on the Board is terminated due to
disability, as determined by the Company, the Grantee may exercise this Option,
in whole or in part, to the extent it was exercisable on the date when the
Grantee's service on the Board terminated, at any time prior to the expiration
date of the Option or within one year of the date of termination of service,
whichever is earlier.
If the Grantee is removed from the Board due to discharge for cause,
as determined by the Company, this Option shall terminate upon receipt by the
Grantee of notice of such removal or the effective date of the removal,
whichever is earlier.
If the service of the Grantee on the Board is terminated on account
of death of the Grantee, the person or persons to whom the Grantee's rights
under the option pass by will or by applicable laws of descent and distribution
may exercise the option, in whole or in part, to the extent it was exercisable
on the date when the Grantee's service terminated, at any time prior to the
expiration date of the Option or within one year after the date of the death of
the Grantee, whichever is earlier. The person or persons to whom the Grantee's
rights under the Option pass shall be considered the Grantee.
6. OPTION NOT ASSIGNABLE. This Option shall only be transferable by
will or the laws of descent and distribution, or pursuant to a qualified
domestic relations order as defined by the Internal Revenue Code of 1986, as
amended, or Title I of the Employee Retirement Income Security Act or the rules
thereunder. It may be exercised, during the life of the Grantee, only by the
Grantee, and may not be pledged or hypothecated in any way. Additionally, it
shall not be subject to execution, attachment or similar process.
7. TERMINATION OF OPTION. This Option shall terminate and all rights
of the Grantee shall cease at the earliest of the following:
(a) 5:00 p.m., local time, of the day before the end of the
three month period following the termination of the
Grantee's service on the Board for any reason other than
death, disability or discharge for cause;
(b) 5:00 p.m., local time, of the day before the end of the
one year period following the termination of the
Grantee's service on the Board due to disability;
(c) The earlier of 5:00 p.m., local time, of the effective
date of the Grantee's termination of service on the
Board for cause or receipt by the Grantee of notice of
termination for cause;
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<PAGE> 4
(d) 5:00 p.m., local time, on the day before the end of the
one year period following the Grantee's death if the
Grantee's service on the Board is terminated by death;
and
(e) Expiration of this Option as provided in paragraph 3.
8. EXERCISE OF OPTION. This Option may be exercised by presenting a
written notice to the Company that the Option is being exercised. Such notice
shall identify this Option, state the number of Option Shares exercised, and
shall be signed by the Grantee. Payment in full for the Option Shares to be
purchased shall accompany the notice of exercise. Such payment shall be by bank
cashier's check or certified check or with shares of the Company already owned
by the Grantee having a fair market value on the date of exercise equivalent to
the amount that would otherwise be payable, or any combination of cash and such
shares equivalent to such amount. Any representation required by paragraph 10
shall also accompany the notice of exercise.
The fair market value of a share of the Company on any particular
date shall mean fair market value as determined under Section 3(e) of the Plan.
If the Grantee is deceased, or if the Grantee is disabled, the notice of
exercise may be signed by the Grantee's legal representatives or heirs, and
shall be accompanied by evidence satisfactory to the Company of the right of
such person or persons to exercise this Option. The Grantee shall have none of
the rights of a shareholder with respect to any of the Option Shares until the
Option Shares are actually issued.
9. RECAPITALIZATION, REORGANIZATION, DISSOLUTION. This Option shall
not affect in any way the right or power of the Company or its shareholders to
make or authorize any merger, consolidation, recapitalization, reorganization or
dissolution of the Company or any other corporate act or proceeding whether of a
similar character or otherwise. In the event of any change in the Option Shares
through reorganization, recapitalization, stock split, stock dividend,
continuation of shares, merger, consolidation, rights offering, or any other
change in the corporate structure, appropriate adjustments shall be made by the
Board in the number and kind of shares and the price per share subject to this
Option. The determination of the Board on whether any adjustment is required and
the extent and nature of any such adjustment shall be final and binding upon all
persons. Upon a determination by the Board of any adjustment in the number of
Option Shares or of the option price, this Option shall be amended in accordance
with the action of the Board.
10. SERVICE MAY BE TERMINATED. The granting of this Option shall not
confer upon the Grantee any right to continue in the service on the Board of
Directors and shall not interfere in any way with the right of the Company, with
or without cause, to terminate the Grantee's directorship at any time.
11. COMPLIANCE WITH LEGAL REQUIREMENTS. If, at the time of exercise
of this Option, there is not in effect as to the Option Shares being purchased a
registration statement under the Securities Act of 1933, as amended (or any
successor statute) (collectively the "1933 Act"), then the exercise of this
Option shall be effective only upon receipt by the
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<PAGE> 5
Company from the Grantee (or his legal representatives or heirs) of a written
representation that the Option Shares are being purchased for investment and
not for distribution.
The Company may request an opinion of its counsel as to whether
registration of the Option Shares being purchased is required under the 1933
Act or under applicable state statutes or regulations. If counsel is of the
opinion that such registration is not required, the Company shall issue the
Option Shares. If counsel is of the opinion that such registration is required,
the Company shall not be required to issue the Option Shares until they have
been so registered, but the Company shall be under no obligation to register
the Option Shares.
The Grantee hereby agrees to supply the Company with such information
and to cooperate with the Company, as the Company may reasonably request, in
connection with the preparation and filing of the registration statements and
amendments thereto under the 1933 Act and applicable state statutes and
regulations applicable to the Option Shares. The Company shall not be liable
for failure to issue any such Option Shares where such opinion of counsel cannot
be obtained within the period specified for the exercise of the Option, or
where such registration is required in the opinion of counsel. If shares of
Common Stock of the Company are, at the time of the exercise of this Option,
listed upon a securities exchange, the exercise of this Option shall be
contingent upon completion of the necessary steps to list the Option Shares
being purchased upon such securities exchange.
Furthermore, this Option may only be exercised during the period
beginning on the third business day and ending on the twenty-fifth business day
following the release for publication of quarterly or annual summary statements
of sales and earnings.
12. ADDITIONAL POWERS OF THE BOARD. The Board may construe this
Option and correct any defect, supply any omission or reconcile any
inconsistency in this instrument or in the Plan as the Board may deem
appropriate. The Board shall determine any dispute that may arise under this
Option. All decisions of the Board under this or any other provision of this
Option and under the Plan shall be binding and conclusive on the Grantee, his
or her spouse, legal representatives and heirs.
13. GOVERNING LAW. This instrument shall be governed by the laws of
the State of New Mexico.
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<PAGE> 6
IN WITNESS WHEREOF, the Company has caused this Option to be
executed by a duly authorized officer and its corporate seal to be affixed
effective as of the Grant Date set forth in paragraph 2.
MESA AIR GROUP, INC.
(SEAL)
By:_________________________________
Its:_____________________________
ATTEST:
______________________________________
I hereby acknowledge that I have received a copy of Mesa Airlines,
Inc. Additional Outside Directors' Stock Option Plan.
______________________________________
Grantee
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<PAGE> 1
EXHIBIT 5
OPINION AND CONSENT
OF
CHAPMAN AND CUTLER
<PAGE> 2
EXHIBIT 5
August 1, 1996
Board of Directors
Mesa Air Group, Inc.
2325 East 30th Street
Farmington, New Mexico 87401
Re: Registration Statement on Form S-8
Gentlemen:
In connection with the registration by Mesa Air Group, Inc. (the "Company")
on Form S-8 (the "Registration Statement"), providing for the registration under
the Securities Act of 1933, as amended, of 260,000 shares of the Company's
Common Stock, no par value, we are furnishing the following opinion as counsel
to the Company.
We have examined such corporate records, certificates of public officials
and officers of the Company, and other documents and records as we have
considered necessary or proper for the purpose of this Opinion.
Based upon the foregoing, and having regard to legal considerations that we
deem relevant, we are of the opinion that the foregoing shares of Common Stock
of the Company, when issued and sold in accordance with the terms of the
transactions described in the Registration Statement, and in accordance with the
securities laws of the various states in which the Common Stock may be issued,
will be validly issued, fully paid and nonassessable.
As counsel to the Company, we hereby consent to the reference to this firm
under the caption "Legal Matters" contained in the Prospectus dated August 1,
1996, and to the filing of this opinion as Exhibit 5 to the Registration
Statement.
Very truly yours,
CHAPMAN AND CUTLER
<PAGE> 1
EXHIBIT 24.2
CONSENT OF KPMG PEAT MARWICK LLP
<PAGE> 2
EXHIBIT 24.2
INDEPENDENT AUDITORS' CONSENT
The Board of Directors
Mesa Air Group, Inc.:
We consent to the use of our report incorporated herein by reference and to the
reference to our firm under the heading "Experts" in the Prospectus.
KPMG Peat Marwick LLP
Phoenix, Arizona
July 26, 1996
