<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[x] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 1999
or
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
COMMISSION FILE NUMBER 0-25202
KITTY HAWK, INC.
(Exact name of registrant as specified in its charter)
Delaware 75-2564006
(State of Incorporation) (I.R.S. Employer Identification No.)
1515 West 20th Street
P.O. Box 612787
Dallas/Fort Worth International Airport, Texas 75261
(972) 456-2200
(Address, including zip code, and telephone
number, including area code, of registrant's principal
executive offices)
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes [x] No [ ]
Number of shares outstanding of the registrant's common stock, $0.01 par value,
as of November 12, 1999: 17,057,071.
<PAGE> 2
KITTY HAWK, INC. AND SUBSIDIARIES
<TABLE>
<CAPTION>
PAGE NUMBER
<S> <C>
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements (Unaudited)
Condensed Consolidated Balance Sheets
September 30, 1999 and December 31, 1998............................ 3
Condensed Consolidated Statements of Income
Three months ended September 30, 1999 and 1998 and
Nine months ended September 30, 1999 and 1998....................... 4
Condensed Consolidated Statement of Stockholders' Equity
Nine months ended September 30, 1999................................ 5
Condensed Consolidated Statements of Cash Flows
Nine months ended September 30, 1999 and 1998....................... 6
Notes to Condensed Consolidated Financial Statements................... 7
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations................................ 10
Item 3. Quantitative and Qualitative Disclosures about Market Risk......... 17
PART II. OTHER INFORMATION
Item 1. Legal Proceedings.................................................. 18
Item 2. Changes in Securities.............................................. 18
Item 3. Defaults upon Senior Securities.................................... 18
Item 4. Submission of Matters to a Vote of Security Holders................ 18
Item 5. Other Information.................................................. 18
Item 6. Reports on Form 8-K and Exhibits................................... 18
</TABLE>
2
<PAGE> 3
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS (UNAUDITED)
KITTY HAWK, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands, except share and per share data)
<TABLE>
<CAPTION>
SEPTEMBER 30, DECEMBER 31,
1999 1998
------------- ------------
ASSETS (UNAUDITED)
<S> <C> <C>
Current assets
Cash and cash equivalents ....................... $ 986 $ 15,077
Restricted cash and short-term investments ...... -- 1,964
Trade accounts receivable ....................... 100,152 140,014
Deferred income taxes ........................... 16,088 16,088
Inventory and aircraft supplies ................. 47,626 50,135
Prepaid expenses and other current assets ....... 25,989 22,871
------------ ------------
Total current assets ........................ 190,841 246,149
Property and equipment, net .......................... 739,175 720,808
Other assets, net .................................... 16,210 15,628
------------ ------------
Total assets ......................................... $ 946,226 $ 982,585
============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Accounts payable ................................ $ 38,315 $ 53,967
Accrued expenses ................................ 92,288 104,278
Accrued maintenance reserves .................... 20,967 22,382
Current maturities of long-term debt ............ 13,283 20,564
------------ ------------
Total current liabilities ................... 164,853 201,191
Revolving credit facility ............................ 89,100 86,900
Long-term debt ....................................... 373,845 382,287
Deferred income taxes ................................ 113,261 113,261
Minority interest .................................... -- 4,749
Commitments and contingencies
Stockholders' equity
Preferred stock, $1 par value: Authorized shares
-1,000,000; none issued ..................... -- --
Common stock, $.01 par value: Authorized
shares -25,000,000; issued and outstanding
-17,057,071 and 16,927,942, respectively ..... 170 169
Additional capital .............................. 134,210 133,166
Retained earnings ............................... 70,787 60,862
------------ ------------
Total stockholders' equity .................. 205,167 194,197
------------ ------------
Total liabilities and stockholders' equity ........... $ 946,226 $ 982,585
============ ============
</TABLE>
See accompanying notes.
3
<PAGE> 4
KITTY HAWK, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except per share data)
(unaudited)
<TABLE>
<CAPTION>
THREE MONTHS ENDED NINE MONTHS ENDED
SEPTEMBER 30, SEPTEMBER 30,
----------------------------- -----------------------------
1999 1998 1999 1998
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
Revenues:
Air freight carrier ............................. $ 62,380 $ 82,220 $ 188,334 $ 229,496
Air logistics ................................... 52,115 39,515 123,228 95,140
Scheduled freight ............................... 59,662 43,842 158,837 120,520
Maintenance and other ........................... 9,191 6,332 19,448 24,967
------------ ------------ ------------ ------------
Total revenues .............................. 183,348 171,909 489,847 470,123
Costs of revenues:
Flight expense .................................. 86,913 80,442 216,206 219,662
Maintenance expense ............................. 31,235 39,713 101,270 104,668
Aircraft fuel expense ........................... 21,579 15,599 51,634 46,955
Depreciation expense ............................ 18,575 13,011 53,267 35,444
------------ ------------ ------------ ------------
Total costs of revenues ..................... 158,302 148,765 422,377 406,729
------------ ------------ ------------ ------------
Gross profit ......................................... 25,046 23,144 67,470 63,394
General and administrative expenses .................. 9,019 8,322 25,311 23,933
Non-qualified employee profit sharing expense ........ 1,347 408 1,654 990
------------ ------------ ------------ ------------
Operating income ..................................... 14,680 14,414 40,505 38,471
Other income (expense):
Interest expense ................................ (12,172) (9,581) (36,447) (28,882)
Other, net ...................................... 10,959 296 12,677 1,362
------------ ------------ ------------ ------------
Income before minority interest and income taxes ..... 13,467 5,129 16,735 10,951
Minority interest .................................... -- 1,042 196 2,473
------------ ------------ ------------ ------------
Income before income taxes ........................... 13,467 4,087 16,539 8,478
Income tax expense ................................... 5,386 1,550 6,614 3,306
------------ ------------ ------------ ------------
Net income ........................................... $ 8,081 $ 2,537 $ 9,925 $ 5,172
============ ============ ============ ============
Basic and diluted income per share ................... $ 0.47 $ 0.15 $ 0.58 $ 0.30
============ ============ ============ ============
Weighted average common shares outstanding ........... 17,047 16,925 17,008 16,820
============ ============ ============ ============
</TABLE>
See accompanying notes.
4
<PAGE> 5
KITTY HAWK, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY
(in thousands, except share data)
(unaudited)
<TABLE>
<CAPTION>
NUMBER OF COMMON ADDITIONAL RETAINED
SHARES STOCK CAPITAL EARNINGS TOTAL
---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Balance at December 31, 1998 ............. 16,927,942 $ 169 $ 133,166 $ 60,862 $ 194,197
Shares issued in connection with the
Employee Stock Purchase Plan ........... 129,129 1 1,044 -- 1,045
Net income ............................... -- -- -- 9,925 9,925
---------- ---------- ---------- ---------- ----------
Balance at September 30, 1999 ............ 17,057,071 $ 170 $ 134,210 $ 70,787 $ 205,167
========== ========== ========== ========== ==========
</TABLE>
See accompanying notes.
5
<PAGE> 6
KITTY HAWK, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
(unaudited)
<TABLE>
<CAPTION>
NINE MONTHS ENDED
SEPTEMBER 30,
-----------------------------
1999 1998
------------ ------------
<S> <C> <C>
Operating activities:
Net income .............................................. $ 9,925 $ 5,172
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization ......................... 55,460 37,658
Gain on sales of assets ............................... (11,553) (1,130)
Minority interest ..................................... 196 2,472
Changes in operating assets and
liabilities:
Trade accounts receivable ........................... 40,456 45,878
Inventory and aircraft supplies ..................... (11,405) (31,173)
Prepaid expenses and other current assets............ (2,069) (5,161)
Accounts payable and accrued expenses ............... (26,073) 5,178
Accrued maintenance reserves ........................ (6,737) 1,413
------------ ------------
Net cash provided by operating activities .................. 48,200 60,307
Investing activities:
Capital expenditures .................................... (72,659) (161,854)
Redemption of short term investments .................... -- 56,847
Proceeds from sales of assets ........................... 26,246 6,444
------------ ------------
Net cash used in investing activities ...................... (46,413) (98,563)
Financing activities:
Proceeds from issuance of long-term debt ................ 2,965 5,880
Repayments of long-term debt ............................ (21,043) (3,060)
Net borrowings on revolving credit facility ............. 2,200 35,000
Distributions to minority interest ...................... -- (2,420)
------------ ------------
Net cash (used in) provided by financing activities......... (15,878) 35,400
------------ ------------
Net decrease in cash and cash equivalents .................. (14,091) (2,856)
Cash and cash equivalents at beginning of period ........... 15,077 17,907
------------ ------------
Cash and cash equivalents at end of period ................. $ 986 $ 15,051
============ ============
</TABLE>
See accompanying notes.
6
<PAGE> 7
KITTY HAWK, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1. BASIS OF PRESENTATION
The accompanying condensed consolidated financial statements, which should
be read in conjunction with the consolidated financial statements and footnotes
included in the Company's Annual Report on Form 10-K filed with the Securities
and Exchange Commission for the year ended December 31, 1998, are unaudited
(except for the December 31, 1998 condensed consolidated balance sheet, which
was derived from the Company's audited consolidated balance sheet included in
the aforementioned Form 10-K), but have been prepared in accordance with
generally accepted accounting principles for interim financial information and
with the instructions to Form 10-Q and Article 10 of Regulation S-X.
Accordingly, they do not include all of the information and footnotes required
by generally accepted accounting principles for complete financial statements.
In the opinion of management, all adjustments (consisting only of normal
recurring accruals) considered necessary for a fair presentation have been
included.
Operating results for the three month period and nine month period ended
September 30, 1999 are not necessarily indicative of the results that may be
expected for the year ended December 31, 1999.
2. LEGAL PROCEEDINGS
The Company is subject to various legal proceedings and claims, either
asserted or unasserted, which arise in the ordinary course of business. While
the outcome of these claims cannot be predicted with certainty, management does
not believe that the outcome of any of these legal matters will have a material
adverse effect on the Company's financial position or results of operations.
3. RECLASSIFICATIONS
Certain balances from the prior year have been reclassified to conform to
the current year presentation.
4. SEGMENT REPORTING
The Company derives revenue from four related lines of business: air freight
carrier services, air logistics services, scheduled freight services and
maintenance services. Each of these is considered a business segment, with its
respective financial performance detailed below. Included in each are
intersegment transactions for revenues and costs of revenues that generally
approximate market prices. Each business segment is currently evaluated by the
Company's chief operating decision maker on financial performance at the
operating income line.
The Company's air freight carrier line of business is conducted by the
Company's two FAA Part 121 airlines: a wide-body airline (Kitty Hawk
International, Inc., formerly American International Airways, Inc.) and a
narrow-body airline (Kitty Hawk Aircargo, Inc.). For reporting purposes,
however, the air freight carrier business is reported and referred to herein as
one unit. The Company's air freight carrier provides services to third parties
and the Company's scheduled freight service provider under contractual
arrangements where the Company provides the aircraft, crew, maintenance and
insurance (ACMI). Additionally, the air freight carrier performs ad hoc charters
for the Company's air logistics service provider and other governmental and
commercial customers. The air freight carrier also provided passenger charters
during fiscal years 1997 and 1998. The Company eliminated its passenger charter
division in January 1999.
The Company's air logistics services line of business is conducted by the
Company's FAA Part 135 small aircraft airline, Kitty Hawk Charters, Inc.
(formerly Kalitta Flying Service, Inc.). The air logistics service provider
arranges the delivery of time sensitive freight within North America,
principally the United States. The air logistics service provider utilizes third
party aircraft as well as its own fleet of small aircraft and the fleet of the
Company's two FAA Part 121 air freight carriers.
The Company's scheduled freight service, Kitty Hawk Cargo, Inc. (formerly
American International Cargo and American International Freight), consists of an
overnight freight service provider operating in a network of over 40 North
American cities utilizing a central hub location at Fort Wayne, Indiana, as well
as a service between Los Angeles, the Hawaiian islands and several Pacific Rim
countries.
The Company's maintenance operation has in the past provided JT8 engine
overhauls for third parties as well as for certain of the
7
<PAGE> 8
Company's aircraft. On August 13, 1999, the Company completed the sale of
certain maintenance-related assets and parts to a third party and at September
30, 1999 only provided engine overhauls on JT3 engines for Douglas DC-8s and
small aircraft engines. (See Note 7).
The other category consists of corporate activities as well as the
activities of Longhorn Solutions, Inc., the Company's wholly-owned software
developer/reseller and in-house management information systems service supplier.
Business assets are owned by or allocated to each of the business segments.
Assets included in other include cash, investment in subsidiaries and
intercompany receivables.
<TABLE>
<CAPTION>
ACMI ACMI TOTAL
WIDE- NARROW- AIR FREIGHT AIR SCHEDULED
BODY BODY CARRIER LOGISTICS FREIGHT OTHER
---------- ---------- ----------- ---------- ---------- ----------
(AMOUNTS IN THOUSANDS)
Quarter ended September 30, 1999
<S> <C> <C> <C> <C> <C> <C>
Revenue from external customers $ 20,319 $ 46,872 $ 67,191 $ 56,445 $ 59,662 $ 50
Revenue from intersegment operations 37,067 10,492 47,559 770 468 232
Operating income (loss) 7,401 3,210 10,611 2,279 4,177 (2,387)
Interest expense
Other income (expense)
Income before minority interest
and taxes
Total assets $ 309,497 $ 284,912 $ 594,409 $ 85,753 $ 79,076 $ 704,879
Quarter ended September 30, 1998
Revenue from external customers $ 50,125 $ 35,078 $ 85,203 $ 42,864 $ 43,842 $ --
Revenue from intersegment operations 27,720 7,386 35,106 2,669 464 --
Operating income (loss) 1,929 3,677 5,606 3,345 5,918 (455)
Interest expense
Other income (expense)
Income before minority interest
and taxes
Total assets $ 630,118 $ 172,951 $ 803,069 $ 84,524 $ 27,761 $ 520,233
Nine months ended September 30,
Revenue from external customers $ 69,482 $ 128,252 $ 197,734 $ 133,081 $ 158,837 $ 195
Revenue from intersegment operations 104,814 33,355 138,169 1,675 979 495
Operating income (loss) 14,086 7,531 21,617 12,691 10,466 (4,269)
Interest expense
Other income (expense)
Income before minority interest
and taxes
Total assets $ 309,497 $ 284,912 $ 594,409 $ 85,753 $ 79,076 $ 704,879
Nine months ended September 30,
Revenue from external customers $ 165,550 $ 80,028 $ 245,578 $ 104,025 $ 120,520 $ --
Revenue from intersegment operations 64,339 24,517 88,856 8,420 1,104 --
Operating income (loss) 9,421 12,361 21,782 8,246 9,045 (603)
Interest expense
Other income (expense)
Income before minority interest
and taxes
Total assets $ 630,118 $ 172,951 $ 803,069 $ 84,524 $ 27,761 $ 520,233
<CAPTION>
INTERSEGMENT CONSOLIDATED
ELIMINATIONS BALANCE
------------ ------------
(AMOUNTS IN THOUSANDS)
Quarter ended September 30, 1999
<S> <C> <C>
Revenue from external customers $ -- $ 183,348
Revenue from intersegment operations (48,609) --
Operating income (loss) -- 14,680
Interest expense (12,172)
Other income (expense) 10,959
Income before minority interest
and taxes $ 13,467
Total assets $ (517,891) $ 946,226
Quarter ended September 30, 1998
Revenue from external customers $ -- $ 171,909
Revenue from intersegment operations (38,239) --
Operating income (loss) -- 14,414
Interest expense (9,581)
Other income (expense) 296
Income before minority interest
and taxes $ 5,129
Total assets $ (536,630) $ 898,957
Nine months ended September 30,
1999
Revenue from external customers $ -- $ 489,847
Revenue from intersegment operations (141,318) --
Operating income (loss) -- 40,505
Interest expense (36,447)
Other income (expense) 12,677
Income before minority interest
and taxes $ 16,735
Total assets $ (517,891) $ 946,226
Nine months ended September 30,
1998
Revenue from external customers $ -- $ 470,123
Revenue from intersegment operations (98,380) --
Operating income (loss) -- 38,471
Interest expense (28,882)
Other income (expense) 1,362
Income before minority interest
and taxes $ 10,951
Total assets $ (536,630) $ 898,957
</TABLE>
The Company does not separately report results of its maintenance operation
and related asset information to the Company's chief operating decision maker.
Accordingly, financial data for the maintenance operation is included under the
ACMI Wide-Body, ACMI Narrow-Body and Air Logistics captions above. Third party
maintenance revenue included under the ACMI Wide-Body, ACMI Narrow-Body and Air
Logistics captions above amounted to $2.9 million, $1.9 million and $4.3
million, respectively, for the quarter ended September 30, 1999; $3 million, $0
and $3.3 million, respectively, for the quarter ended September 30, 1998; $6
million, $3.4 million and $9.9 million, respectively, for the nine months ended
September 30, 1999; and $16.1 million, $0 and $8.9 million,
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respectively, for the nine months ended September 30, 1998.
5. SUPPLEMENTAL GUARANTOR INFORMATION
In November 1997, the Company issued $340 million of 9.95% Senior Secured
Notes (the "Notes"). Each of the Company's subsidiaries (collectively, the
"Guarantors") have fully and unconditionally and jointly and severally
guaranteed (the "Guarantees") on a senior basis, the full and prompt performance
of the Company's obligations under the Notes. The Guarantees are limited to the
largest amount that would not render such Guarantees subject to avoidance under
any applicable federal or state fraudulent conveyance or similar law. The
Guarantees rank senior in right of payment to any subordinated indebtedness and,
except with respect to collateral, pari passu with all existing and future
unsubordinated indebtedness of the Guarantors. Each of the Guarantors is a
wholly owned subsidiary of the Company.
The Company has not presented separate financial statements and other
disclosures concerning the Guarantors because the Company's management believes
that such information is not material to investors. Summary financial
information is presented for Kitty Hawk, Inc., the Parent, and the Guarantors.
<TABLE>
<CAPTION>
KITTY HAWK, SUBSIDIARIES
INC. (PARENT) (GUARANTORS) ELIMINATIONS TOTAL
------------- ------------ ------------ ------------
(amounts in thousands)
<S> <C> <C> <C> <C>
As of September 30, 1999
Current assets $ 14,202 $ 176,639 $ -- $ 190,841
Non-current assets 687,364 891,663 (823,642) 755,385
Current liabilities 169,328 719,758 (724,233) 164,853
Non-current liabilities 430,750 145,456 -- 576,206
Minority interest -- -- -- --
Stockholders' equity 101,490 203,087 (99,410) 205,167
As of December 31, 1998
Current assets $ 18,273 $ 227,876 $ -- $ 246,149
Non-current assets 519,434 736,824 (519,822) 736,436
Current liabilities 10,065 620,948 (429,822) 201,191
Non-current liabilities 426,900 155,548 -- 582,448
Minority interest -- -- 4,749 4,749
Stockholders' equity 100,742 188,204 (94,749) 194,197
For the three months ended September 30, 1999
Revenue $ -- $ 183,499 $ (151) $ 183,348
Gross profit -- 25,197 (151) 25,046
Operating income (loss) (2,280) 16,960 -- 14,680
Net income 209 7,872 -- 8,081
For the nine months ended September 30, 1999
Revenue $ -- $ 490,246 $ (399) $ 489,847
Gross profit -- 67,869 (399) 67,470
Operating income (loss) (3,967) 44,472 -- 40,505
Net income (loss) (290) 10,411 (196) 9,925
For the three months ended September 30, 1998
Revenue $ -- $ 171,909 $ -- $ 171,909
Gross profit -- 23,144 -- 23,144
Operating income (loss) (455) 14,869 -- 14,414
Net income (loss) 153 3,426 (1,042) 2,537
For the nine months ended September 30, 1998
Revenue $ -- $ 470,123 $ -- $ 470,123
Gross profit -- 63,394 -- 63,394
Operating income (loss) (667) 39,138 -- 38,471
Net income (loss) (61) 7,706 (2,473) 5,172
</TABLE>
6. EARNINGS PER SHARE
Earnings per share is calculated based on the weighted average number of
shares outstanding during the period, taking into consideration the dilutive
effect of the Company's outstanding options issued to its employees and
directors to acquire the Company's common stock. As of September 30, 1999,
690,000 options were outstanding with a weighted average exercise price of
$14.50 per share. As the weighted average exercise price of the outstanding
options exceeded the average market price of the Company's
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<PAGE> 10
common stock for each of the three and nine month periods ended September 30,
1999, the effect of the stock options was excluded from the Company's diluted
earnings per share calculation.
7. SALE OF MAINTENANCE FACILITIES
On August 13, 1999, the Company and certain of its wholly-owned
subsidiaries completed the sale of its Oscoda, Michigan-based JT8 engine and
aircraft maintenance operations to TIMCO Engine Center, Inc., a wholly-owned
indirect subsidiary of Aviation Sales Company. At closing, the Company received
approximately $21.4 million of consideration, consisting of approximately $17.9
million of cash and $3.5 million of purchase credits. The Company and certain of
its wholly-owned subsidiaries also entered into 3-year exclusive maintenance
agreements with subsidiaries of Aviation Sales Company for heavy maintenance of
the Company's fleet of Boeing 727s and off-wing maintenance of the Company's JT8
engines. The Company recognized a gain of approximately $8.3 million on the sale
of this maintenance facility. Upon consummation of the sale, the Company ceased
providing third party overhaul services on JT8 engines for Boeing 727s and
Douglas DC9s.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
OVERVIEW
Revenues. The Company's revenues are derived from four related lines of
business: (i) air freight carrier services, (ii) air logistics services, (iii)
scheduled freight services and (iv) maintenance services. The Company's air
freight carrier line of business is conducted by the Company's two FAA Part 121
airlines: a wide-body airline (Kitty Hawk International, Inc., formerly American
International Airways, Inc.) and a narrow-body airline (Kitty Hawk Aircargo,
Inc.). For reporting purposes, however, the air freight carrier business is
reported and referred to herein as one unit. The Company's air logistics
services line of business is conducted by the Company's FAA Part 135 small
aircraft airline.
Air freight carrier revenues are derived substantially from aircraft, crew,
maintenance, and insurance ("ACMI") contract charters. In addition, revenues
from the Company's passenger charter service (which was eliminated in January
1999) are also included in air freight carrier revenues. Air logistics revenues
are derived substantially from on-demand air freight charters arranged by the
Company for its customers utilizing the flight services of third party air
freight carriers as well as the Company's own fleet of small jet and prop
aircraft and the fleet of the Company's two FAA Part 121 air freight carriers.
Scheduled freight service revenues are generated through an overnight
airport-to-airport freight service to over 40 North American cities and an
international service between Los Angeles and Honolulu, among the Hawaiian
islands and once a week through Melbourne, Hong Kong and other Pacific Rim
locations. Maintenance revenue was previously generated from third party
maintenance work performed on engines and airframes. During the fourth quarter
of 1998, the Company stopped providing third party airframe repairs and engine
overhaul services, other than on JT3 engines used on Douglas DC-8s and JT8
engines used on Boeing 727s and Douglas DC-9s. In August 1999, in connection
with the sale of its Oscoda, Michigan-based JT8 engine and aircraft maintenance
operations to Aviation Sales Company, the Company stopped providing third party
engine overhaul services on JT8 engines.
The principal factors that have contributed to revenue growth over the past
several years have been increases in the Company's fleet from 10 aircraft at
December 31, 1993 to 96 aircraft at September 30, 1999, the general U.S.
economic expansion and the increased global demand for time sensitive air
freight services.
Costs of Revenues. The principal components of the costs of revenues are
flight expense, maintenance expense, aircraft fuel expense and depreciation
expense. Flight expense includes the salaries and expenses for pilots and flight
operations personnel, insurance, sub-charter costs paid to third party air
freight carriers and costs paid for ground handling and transportation.
Maintenance expense includes salaries and expenses for maintenance personnel and
maintenance on the aircraft. Aircraft fuel expense is generally applicable only
to the air logistics service provider and the scheduled freight services
provider because fuel for the ACMI contract charters is generally provided by
the customer or billed to the customer on a direct pass-through basis.
Depreciation expense includes depreciation on airframes and engines and all
other property and equipment associated with the operation of each business
segment.
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RESULTS OF OPERATIONS
The following table presents, for the periods indicated, condensed
consolidated statement of operations data expressed as a percentage of total
revenues:
<TABLE>
<CAPTION>
THREE MONTHS ENDED SEPTEMBER 30, NINE MONTHS ENDED SEPTEMBER 30,
-------------------------------- -------------------------------
1999 1998 1999 1998
---------- ---------- ---------- ----------
Revenues:
<S> <C> <C> <C> <C>
Air freight carrier ....................... 34.0% 47.8% 38.4% 48.8%
Air logistics ............................. 28.4 23.0 25.2 20.2
Scheduled freight service ................. 32.6 25.5 32.4 25.7
Maintenance and other ..................... 5.0 3.7 4.0 5.3
-------- -------- -------- --------
Total revenues ........................ 100.0 100.0 100.0 100.0
Costs of revenues:
Flight expense ............................ 47.4 46.8 44.1 46.7
Maintenance expense ....................... 17.0 23.1 20.7 22.3
Aircraft fuel expense ..................... 11.8 9.1 10.5 10.0
Depreciation expense ...................... 10.1 7.5 10.9 7.5
-------- -------- -------- --------
Total costs of revenues ................ 86.3 86.5 86.2 86.5
-------- -------- -------- --------
Gross profit ................................... 13.7 13.5 13.8 13.5
General and administrative expenses ............ 4.9 4.9 5.2 5.1
Non-qualified employee profit sharing
expense ...................................... 0.8 0.2 0.3 0.2
-------- -------- -------- --------
Operating income ............................... 8.0 8.4 8.3 8.2
Interest expense ............................... (6.6) (5.6) (7.5) (6.2)
Other income ................................... 5.9 0.2 2.6 0.3
-------- -------- -------- --------
Income before minority interest and
income taxes ................................. 7.3 3.0 3.4 2.3
Minority interest .............................. -- 0.6 -- 0.5
-------- -------- -------- --------
Income before income taxes ..................... 7.3 2.4 3.4 1.8
Income tax expense ............................. 2.9 0.9 1.4 0.7
-------- -------- -------- --------
Net income ..................................... 4.4% 1.5% 2.0% 1.1%
======== ======== ======== ========
</TABLE>
QUARTER ENDED SEPTEMBER 30, 1999 COMPARED TO QUARTER ENDED SEPTEMBER 30, 1998
Revenues - Air Freight Carrier. Air freight carrier revenues decreased $19.8
million, or 24.1%, to $62.4 million in the quarter ended September 30, 1999,
from $82.2 million in the quarter ended September 30, 1998. This decrease was
primarily attributable to (i) the elimination of the Company's passenger charter
division, which contributed $18 million of revenue in the quarter ended
September 30, 1998, (ii) the shift of one Boeing 747 aircraft from air freight
carrier service to scheduled freight service and (iii) a reduction in block
hours flown by Douglas DC-8s as the Company positions itself to retire 13 of
these aircraft due to FAA noise abatement regulations. This decrease was
partially offset by revenue from two additional Boeing 747s added to the fleet
after September 30, 1998. Additionally, the Company shifted six Boeing 727
aircraft from scheduled freight service to air freight carrier service with the
award of the United States Postal Service ("USPS") W-Net contract in August
1999. The Company also implemented selective price increases for some of its
ACMI contract charters.
Revenues - Air Logistics. Air logistics revenues increased $12.6 million, or
31.9%, to $52.1 million in the quarter ended September 30, 1999, from $39.5
million in the quarter ended September 30, 1998. Although prices for the
Company's air logistics services remained relatively constant, the average
revenue per trip increased from $6,286 for the quarter ended September 30, 1998,
to $8,631 for the quarter ended September 30, 1999, due to a change in the mix
of aircraft used. The overall number of trips managed by the air logistics
service provider decreased from 6,286 in the quarter ended September 30, 1998 to
6,038 in the quarter ended September 30, 1999, a 3.9% decrease.
Revenues - Scheduled Freight. Scheduled freight revenues increased $15.8
million, or 36%, to $59.7 million in the quarter ended September 30, 1999, from
$43.8 million in the quarter ended September 30, 1998. This increase was
primarily due to (i) several price increases since September 30, 1998, (ii)
adding another Boeing 747 into international scheduled service in May 1999 and
(iii) adding a fifth night to certain domestic scheduled routes effective June
1, 1999. Freight volumes in the scheduled freight operation increased
approximately 11.4% from the quarter ended September 30, 1998, as compared to
the quarter ended September 30, 1999 due to the additional flight activity. The
average yield per pound increased 22%, from $0.54 per pound for the quarter
ended September 30, 1998 to $0.66 per pound for the quarter ended September 30,
1999.
11
<PAGE> 12
Revenues - Maintenance and Other. Maintenance and other revenues increased
$2.9 million, or 45.2%, to $9.2 million in the quarter ended September 30, 1999,
from $6.3 million in the quarter ended September 30, 1998. The increase is due
to increased activity in the JT3 engine shop and the small engine shop as well
as a push to complete the open JT8 engine work prior to the sale of the Oscoda,
Michigan maintenance operations.
Costs of Revenues - Flight Expense. Flight expense increased 8% to $86.9
million in the quarter ended September 30, 1999, from $80.4 million in the
quarter ended September 30, 1998. As a percent of revenues, flight expense
increased to 47.4% for the quarter ended September 30, 1999, as compared to
46.8% for the quarter ended September 30, 1998. This increase as a percent of
revenues was primarily due to a $15.3 million increase in flight expense
attributable to the Company's air logistics service provider due to an increase
in the number of large aircraft trips during the quarter ended September 30,
1999. This increase was offset by (i) the elimination of the passenger charter
division (which resulted in reduced wages, catering expense, subcharter expense
and ground handling costs, a savings of $5.7 million), (ii) a general reduction
in crew travel costs and (iii) an overall reduction in subcharter expense as
fewer Company aircraft were out of service for maintenance activities.
Costs of Revenues - Maintenance Expense. Maintenance expense decreased $8.5
million, or 21.4%, to $31.2 million in the quarter ended September 30, 1999,
from $39.7 million in the quarter ended September 30, 1998. The decrease is
primarily due to a decrease of approximately $5 million in personnel costs,
parts expense and facility expense associated with the sale of the maintenance
operation in Oscoda, Michigan and an overall decrease in maintenance related to
the parking of the four passenger aircraft in January 1999 and five Douglas DC-8
aircraft during the first nine months of 1999. As a percent of revenues,
maintenance expense decreased from 23.1% for the quarter ended September 30,
1998 to 17.0% for the quarter ended September 30, 1999.
Costs of Revenues - Aircraft Fuel Expense. Aircraft fuel expense increased
$6 million, or 38.3%, to $21.6 million in the quarter ended September 30, 1999,
from $15.6 million in the quarter ended September 30, 1998. As a percent of
revenues, aircraft fuel expense increased from 9.1% for the quarter ended
September 30, 1998 to 11.8% for the quarter ended September 30, 1999. This
increase is primarily due to a 34% increase in fuel prices from an average price
of $0.59 per gallon for the quarter ended September 30, 1998 as compared to an
average price of $0.79 per gallon for the quarter ended September 30, 1999. Fuel
expense has also increased due to increased flight activity for the Company's
scheduled freight and air logistics operations and two USPS contracts, where
fuel costs are not directly passed through to the USPS. The increase in fuel
expense was partially offset by the elimination of the Company's passenger
charter business, which resulted in a savings of $2.9 million in the quarter
ended September 30, 1999.
Costs of Revenues - Depreciation Expense. Depreciation expense increased
$5.6 million, or 42.8%, to $18.6 million in the quarter ended September 30,
1999, from $13 million in the quarter ended September 30, 1998. As a percent of
revenues, depreciation expense increased from 7.6% for the quarter ended
September 30, 1998 to 10.2% for the quarter ended September 30, 1999. This
increase is primarily due to the depreciation of capital expenditures of
approximately $129 million since September 30, 1998, consisting principally of
(i) cargo modifications to two Boeing 747s and two Boeing 727s, (ii) engine
overhauls and (iii) noise abatement modifications to the Company's Boeing 727
fleet.
General and Administrative Expenses. General and administrative expenses
increased $0.7 million, or 8.4%, to $9 million in the quarter ended September
30, 1999, from $8.3 million in the quarter ended September 30, 1998. As a
percentage of total revenues, general and administrative expenses increased to
4.9% in the quarter ended September 30, 1999, as compared to 4.8% for the
quarter ended September 30, 1998, principally reflecting an increase in
administrative personnel and professional fees.
Operating Income. As a result of the above, operating income increased $0.3
million to $14.7 million in the quarter ended September 30, 1999, from $14.4
million in the quarter ended September 30, 1998. Operating income margin
decreased to 8% in the quarter ended September 30, 1999, from 8.4% in the
quarter ended September 30, 1998.
Interest Expense. Interest expense increased to $12.2 million for the
quarter ended September 30, 1999, from $9.6 million for the quarter ended
September 30, 1998, a 27% increase. The increase was primarily the result of
increased borrowings on the Company's Credit Facility, an increase of $44.1
million from September 30, 1998, and an overall increase in the interest rate
under the December 10, 1998 amendment to the Credit Facility. Additionally,
approximately $1.4 million of interest expense was capitalized during the
quarter ended September 30, 1998 in connection with funds used in the cargo
modification of one Boeing 747.
Other income increased from $0.3 million for the quarter ended September 30,
1998, to $11 million for the quarter ended September 30, 1999. The increase was
primarily the result of $8.3 million of gain recognized on the sale of the
Company's maintenance facility in Oscoda, Michigan and $2.3 million of gain
recognized on the sale of the Company's 1/3 interest in four Falcon aircraft.
12
<PAGE> 13
Income Tax Expense. Income tax expense as a percentage of income before
income taxes was 40% for the quarter ended September 30, 1999, as compared to
38% for the quarter ended September 30, 1998. This increase reflects a change in
the mix of state income taxes payable and the impact of non-deductible crew
travel costs.
Net Income. As a result of the above, the Company's net income increased to
$8.1 million in the quarter ended September 30, 1999, as compared to net income
of $2.5 million in the quarter ended September 30, 1998. Net income as a
percentage of total revenues increased to 4.4% in the quarter ended September
30, 1999, from 1.5% in the quarter ended September 30, 1998.
NINE MONTHS ENDED SEPTEMBER 30, 1999 COMPARED TO NINE MONTHS ENDED SEPTEMBER 30,
1998
Revenues - Air Freight Carrier. Air freight carrier revenues decreased $41.2
million, or 18%, to $188.3 million in the nine months ended September 30, 1999,
from $229.5 million in the nine months ended September 30, 1998. This decrease
was primarily attributable to (i) the elimination of the Company's passenger
charter division, which contributed $46.8 million of revenue in the nine months
ended September 30, 1998, (ii) the shift of one Boeing 747 from air freight
carrier service to scheduled freight service and (iii) an overall reduction in
block hours flown by Douglas DC-8s as the Company positions itself to retire 13
of these aircraft due to FAA noise abatement regulations. This decrease was
partially offset by two additional Boeing 747s placed into cargo service after
September 30, 1998 and increased utilization of aircraft during non-peak cargo
hours. Additionally, the Company shifted six Boeing 727 aircraft from scheduled
freight service to air freight carrier service with the award of the USPS W-Net
contract in August 1999. The Company also implemented selective price increases
for some of its ACMI contract charters.
Revenues - Air Logistics. Air logistics revenues increased $28.1 million, or
29.5%, to $123.2 million in the nine months ended September 30, 1999, from $95.1
million in the nine months ended September 30, 1998. This increase was primarily
due to an increase in the number of trips managed from 15,317 in the nine months
ended September 30, 1998 to 18,065 in the nine months ended September 30, 1999,
a 17.9% increase. Although prices for the Company's air logistics services
remained relatively constant, the average revenue per trip increased 9.8% due to
the mix of the aircraft used for the trips.
Revenues - Scheduled Freight. Scheduled freight revenues increased $38.3
million, or 31.8%, to $158.8 million in the nine months ended September 30,
1999, from $120.5 million in the nine months ended September 30, 1998. This
increase was primarily due to (i) several price increases since September 30,
1998, (ii) adding another Boeing 747 aircraft into international scheduled
service in May 1999 and (iii) adding a fifth night to certain domestic scheduled
routes effective June 1, 1999. Freight volumes in the scheduled freight
operation increased 7.3% in the nine months ended September 30, 1999 as compared
to the nine months ended September 30, 1998 due to the additional flight
activity. The average yield per pound increased 21.6%, from $0.51 per pound for
the nine months ended September 30, 1998, to $0.62 per pound for the nine months
ended September 30, 1999.
Revenues - Maintenance and Other. Maintenance and other revenues decreased
$5.5 million, or 22.1%, to $19.4 million in the nine months ended September 30,
1999, from $25 million in the nine months ended September 30, 1998. This
decrease was primarily due to the Company's discontinuation of providing third
party airframe repairs and engine overhaul services (other than on JT3 engines
used on Douglas DC-8s) on JT8 engines used on Boeing 727s and Douglas DC-9s. In
August 1999, the Company sold the maintenance facility used to overhaul JT8
engines.
Costs of Revenues - Flight Expense. Flight expense decreased $3.5 million,
or 1.6%, to $216.2 million in the nine months ended September 30, 1999, from
$219.7 million in the nine months ended September 30, 1998. As a percent of
revenues, flight expense decreased to 44.1% for the nine months ended September
30, 1999 as compared to 46.7% for the nine months ended September 30, 1998. This
decrease was primarily due to (i) the elimination of the passenger charter
division (which resulted in reduced wages, catering expenses, subcharter
expenses and ground handling costs, a savings of $14.8 million), (ii) a general
reduction in crew travel costs and (iii) an overall reduction in subcharter
expense as fewer Company aircraft were out of service for maintenance
activities. These decreases were partially offset by a $23.4 million increase in
flight expense attributable to the air logistics service due to an increase in
the number of trips.
Costs of Revenues - Maintenance Expense. Maintenance expense decreased $3.4
million, or 3.2%, to $101.3 million in the nine months ended September 30, 1999,
from $104.7 million in the nine months ended September 30, 1998. The decrease is
primarily due to a decrease of approximately $5 million in personnel costs,
parts expense, and facility expense associated with the sale of the maintenance
operation in Oscoda, Michigan and an overall decrease in maintenance related to
the parking of the four passenger aircraft in January 1999 and five Douglas DC-8
aircraft during the first nine months of 1999. As a percent of revenues,
maintenance expense decreased from 22.3% for the nine months ended September 30,
1998, to 20.7% for the nine months ended September 30, 1999.
13
<PAGE> 14
Costs of Revenues - Aircraft Fuel Expense. Aircraft fuel expense increased
$4.7 million, or 10%, to $51.6 million in the nine months ended September 30,
1999, from $47 million in the nine months ended September 30, 1998. As a percent
of revenues, aircraft fuel expense increased from 10% for the nine months ended
September 30, 1998, to 10.6% for the nine months ended September 30, 1999.
Average fuel prices remained fairly consistent at $0.68 per gallon for the nine
months ended September 30, 1999 as compared to $0.67 per gallon for the nine
months ended September 30, 1998. The increase in fuel expense is primarily due
to increased flight activity for the Company's scheduled freight service during
the middle of 1999 (adding one additional Boeing 747 and the fifth night of
service for some domestic routes), increased number of trips in the air
logistics service provider, and two USPS contracts, where fuel costs are not
directly passed through to the USPS. This increase is offset by the Company no
longer incurring aircraft fuel expense from its passenger charter business,
which resulted in a savings of $7 million in the nine months ended September 30,
1999.
Costs of Revenues - Depreciation Expense. Depreciation expense increased
$17.8 million, or 50.3%, to $53.3 million in the nine months ended September 30,
1999, from $35.4 million in the nine months ended September 30, 1998. As a
percent of revenues, depreciation expense increased from 7.5% for the nine
months ended September 30, 1998 to 10.9% for the nine months ended September 30,
1999. This increase is primarily due to the depreciation of capital expenditures
of approximately $129 million since September 30, 1998, consisting principally
of (i) cargo modifications to two Boeing 747s and two Boeing 727s, (ii) engine
overhauls and (iii) noise abatement modifications to the Company's Boeing 727
fleet.
General and Administrative Expenses. General and administrative expenses
increased $1.4 million, or 5.8%, to $25.3 million in the nine months ended
September 30, 1999, from $23.9 million in the nine months ended September 30,
1998. As a percentage of total revenues, general and administrative expenses
increased to 5.2% in the nine months ended September 30, 1999, as compared to
5.1% for the nine months ended September 30, 1998. The increase was principally
due to an increase in administrative personnel and professional fees.
Operating Income. As a result of the above, operating income increased $2
million to $40.5 million in the nine months ended September 30, 1999, from $38.5
million in the nine months ended September 30, 1998. Operating income margin
increased to 8.3% in the nine months ended September 30, 1999, from 8.2% in the
nine months ended September 30, 1998.
Interest Expense. Interest expense increased to $36.4 million for the nine
months ended September 30, 1999, from $28.9 million for the nine months ended
September 30, 1998, a 26.2% increase. The increase was primarily the result of
increased borrowings on the Company's Credit Facility, an increase of $44.1
million from September 30, 1998, and an overall increase in the interest rate
under the December 10, 1998 amendment to the Credit Facility. Additionally,
approximately $3 million of interest expense was capitalized during the nine
months ended September 30, 1998 in connection with funds used in the cargo
modification of one Boeing 747.
Other income increased from $1.4 million for the nine months ended September
30, 1998, to $12.7 million for the nine months ended September 30, 1999. The
increase was primarily the result of $8.3 million of gain recognized on the sale
of the Company's maintenance facility in Oscoda, Michigan and $2.3 million of
gain recognized on the sale of the Company's 1/3 interest in four Falcon
aircraft.
Income Tax Expense. Income tax expense as a percentage of income before
income taxes was 40% for the nine months ended September 30, 1999, as compared
to 39% for the nine months ended September 30, 1998. This increase reflects a
change in the mix of state income taxes payable and the impact of non-deductible
crew travel costs.
Net Income. As a result of the above, the Company's net income increased to
$9.9 million in the nine months ended September 30, 1999, compared to a net
income of $5.2 million in the nine months ended September 30, 1998. Net income
as a percentage of total revenues increased to 2.0% in the nine months ended
September 30, 1999, from 1.1% in the nine months ended September 30, 1998.
LIQUIDITY AND CAPITAL RESOURCES
The Company's capital requirements are primarily for the acquisition and
modification of aircraft and working capital. In addition, the Company has, and
will continue to have, capital requirements for the requisite periodic and major
overhaul maintenance checks for its fleet and for debt service. The Company also
has seasonal working capital needs, because it generates higher revenue in the
fourth calendar quarter and lower revenue in the first calendar quarter. Funding
requirements have historically been met through internally generated funds, bank
borrowings and aircraft and other asset sales and from public and private
offerings of equity and debt securities. From time to time, the Company has
entered into sale/leaseback transactions to acquire aircraft and may do so in
the future.
14
<PAGE> 15
In November 1997, the Company issued $340 million of 9.95% Senior Secured
Notes (the "Notes"), resulting in net proceeds to the Company of approximately
$329.1 million. The Notes provide for semi-annual interest payments of
approximately $16.9 million on each May 15 and November 15 and mature in
November 2004. The Notes are secured by a fleet of 30 aircraft, including nine
Boeing 747s, eight Lockheed L-1011s and 13 Boeing 727s. The Notes are guaranteed
by all of the Company's subsidiaries.
The Company has a $38.7 million outstanding Term Loan. The Term Loan is due
in quarterly installments of $2.25 million, with the balance of $12.5 million
due upon maturity in September 2002. Except as noted below, interest on the Term
Loan accrues at LIBOR plus 3% or a Base Rate plus 1.5%, subject to reduction.
The Base Rate is the higher of the Prime Rate of Wells Fargo Bank, N.A. (Texas)
("WFB") or the Federal Funds Rate plus 0.5%. As of September 30, 1999, the
interest rate was 8.8%. Except as provided below, the Term Loan is secured by
accounts receivable, all spare parts (including rotables), inventory,
intangibles and contract rights, cash, 15 Boeing 727s and related engines and
the stock of each of the Company's subsidiaries. The Term Loan is guaranteed by
all of the Company's subsidiaries.
In addition, to fund ongoing capital requirements, including possible
acquisitions, the Company has entered into a Credit Facility with WFB,
individually and as agent for various lenders. The Credit Facility provides the
Company with up to $100 million in revolving loans (subject to a current
borrowing base limitation of $100 million, including an increase of $30 million
to the borrowing base as a result of an amendment to the Credit Facility (the
"Amendment") on December 10, 1998) that is secured by the same collateral as the
Term Loan. Except as provided below, the Credit Facility bears interest at LIBOR
plus 2.75% or a Base Rate plus 1.25%, subject to adjustment. The Base Rate is
the higher of WFB's Prime Rate or the Federal Funds Rate plus 0.5%. Borrowings
under the Credit Facility are subject to borrowing base limitations based on
eligible inventory and accounts receivable. The Credit Facility matures in
November 2002. As of September 30, 1999, the Company had a balance of $89.1
million outstanding under the Credit Facility bearing interest at a weighted
average rate of 9% and available borrowings under the Credit Facility of
approximately $10.5 million. Borrowings under the Credit Facility and Term Loan
are subject to certain financial covenants. As of September 30, 1999, the
Company was in compliance with all such financial covenants.
In connection with the Amendment, the Company pledged 11 Douglas DC-8-60s
and eight Douglas DC-8-50s under the Credit Facility and the Term Loan. The
Company can request WFB to release its liens on the Douglas DC-8-50 aircraft at
any time in connection with a sale of the aircraft for full and fair
consideration. With respect to the Douglas DC-8-60 aircraft, the Company can
request WFB to release its liens on the Douglas DC-8-60s after first repaying
the amount borrowed, if any, under the Amendment's $30 million increase to the
borrowing base. Prior to December 31, 1999, WFB is not obligated to release its
liens on the Douglas DC-8-60s except in connection with a sale of the aircraft
for full and fair consideration. After December 31, 1999, WFB is not obligated
to release its liens on the Douglas DC-8-60s unless the Company meets specified
financial criteria.
The Amendment's increase in the borrowing base is available through January
1, 2000, subject to earlier termination by the Company (the "Loan Pricing
Increase Period"). During the Loan Pricing Increase Period, the interest rate of
the Term Loan and the Credit Facility is either the Prime Rate of WFB plus 1.75%
or LIBOR plus 3.25%, regardless of financial covenant performance. Upon
termination of this borrowing base increase, the interest rates on the Term Loan
and the Credit Facility revert to those stated above. The Company is currently
working to convert the $30 million increase in the borrowing base availability
to a 5 year term loan or to enter into a sale/leaseback arrangement with the
assets securing the $30 million increased borrowing base availability.
Capital expenditures were $72.6 million and $161.9 million for the nine
months ended September 30, 1999 and 1998, respectively. Capital expenditures for
the nine months ended September 30, 1999 were primarily for (i) modification of
one Boeing 727 to cargo configuration, (ii) noise abatement modifications for
six Boeing 727s, (iii) engine overhauls, (iv) heavy maintenance checks on three
Boeing 727s and (v) purchase of rotable aircraft parts. Capital expenditures for
the nine months ended September 30, 1998 were primarily for (i) the purchase of
two Boeing 747s, (ii) cargo modifications to two Boeing 747s and one Boeing 727,
(iii) heavy maintenance checks on three Boeing 727s, (iv) noise abatement
modifications for ten Boeing 727s, (v) engine overhauls, (vi) the purchase of 15
engines, (vii) improvements to new office space at Dallas/Fort Worth
International Airport and (viii) the purchase of rotable aircraft parts.
During the remainder of 1999, the Company estimates that capital
expenditures will be, in the aggregate, between $20 and $25 million and that it
will make substantial capital expenditures thereafter.
During the remainder of 1999, the Company anticipates capital expenditures
of approximately $5 million for noise abatement modifications to one Douglas
DC-9 and three Boeing 727 aircraft currently owned. The entire fleet must comply
with Federal Aviation Administration ("FAA") noise regulations by the year 2000.
In the event more aircraft are acquired, anticipated capital expenditures for
noise abatement modifications could materially increase.
15
<PAGE> 16
Service bulletins and directives issued under the FAA's "Aging Aircraft"
program or issued on an ad hoc basis cause certain of the Company's aircraft to
be subject to extensive aircraft examinations and/or structural inspections and
modifications to address problems of corrosion and structural fatigue, among
other things. Directives applicable to the Company's fleet can be issued at any
time. The cost of complying with such potential future directives cannot
currently be estimated, but could be substantial.
The Company operates a fleet of 32 Boeing 727s, all of which were previously
converted from passenger configuration to cargo configuration by the
installation of a large cargo door and numerous interior modifications related
to the installation of cargo container handling systems. The FAA has issued a
Directive which limits the cargo capacity of these Boeing 727s from
approximately 8,000 pounds per cargo position to 4,000 pounds per cargo position
until certain modifications are made. The Company received approval from the FAA
to modify its fleet of Boeing 727s to increase their cargo capacity to
approximately 6,000 pounds per cargo position. The modifications are expected to
take from three to four days to complete and to cost between $25,000 and $50,000
per aircraft, not including aircraft downtime. The costs incurred to modify the
aircraft are expensed as incurred. As of October 31, 1999, the Company had 16
aircraft left to modify.
In October 1999, Kitty Hawk International, Inc. ("KHII") and the pilots and
flight engineers in the service of KHII, represented by the International
Brotherhood of Teamsters, entered into a Collective Bargaining Agreement (the
"CBA") governing the terms and conditions of employment of KHII's pilots and
flight engineers for a period of four years. The CBA calls for an increase in
the pilot's and flight engineer's pay, however, KHII expects the increased
salary expenses will be partially offset by reduced expenses attributable to
better work rules and pilot productivity. The Company does not believe that the
net increase in flight expenses resulting from the CBA will have a material
adverse effect on the Company and its financial results.
The Company believes that available funds, bank borrowings and cash flows
expected to be generated by operations and through planned asset sales will be
sufficient to meet its anticipated cash needs for working capital, debt service
and capital expenditures for at least the next 12 months. Thereafter, if cash
generated by operations is insufficient to satisfy the Company's liquidity
requirements, the Company may sell additional equity or debt securities or
obtain additional credit facilities. However, there can be no assurance that the
Company will be able to sell any additional equity or debt securities or obtain
additional credit facilities. Notwithstanding the foregoing, the Company may
sell additional equity or debt securities or obtain additional credit facilities
at any time.
YEAR 2000
The Year 2000 issue is the result of computer programs being written using
two digits rather than four to define the applicable year. Any of the Company's
computer programs or hardware that have date-sensitive software or embedded
chips may recognize a date using "00" as the year 1900 rather than the year
2000. This could result in a system failure or miscalculations causing
disruptions of operations, including, among other things, a temporary inability
to process transactions or engage in normal business activities.
Based on recent assessments, the Company determined that it will be required
to modify or replace portions of its software so that those systems will
properly utilize dates beyond December 31, 1999. The Company presently believes
that with modifications or replacements of existing software the Year 2000 issue
can be mitigated. However, if such modifications and replacements are not made,
or are not completed timely, the Year 2000 issue could have a material impact on
the operations of the Company.
The Company's plan to resolve the Year 2000 issue involves the following
four phases: assessment, remediation, testing and implementation. To date, the
Company has completed its assessment of all systems that could be significantly
affected by the Year 2000. The assessment indicates that most of the Company's
significant information technology systems could be affected. The Company has
determined that most of the services it has sold and will continue to sell do
not require remediation to be Year 2000 compliant. Accordingly, the Company does
not believe that the Year 2000 presents a material exposure as it relates to the
Company's services. In addition, the Company has substantially completed
gathering information about the Year 2000 compliance status of its significant
suppliers and subcontractors and will continue to monitor their compliance.
With regard to the Company's information technology exposure, to date the
Company has completed the assessment phase and has completed substantially all
of the necessary software reprogramming and replacement (remediation). The
testing and implementation phases of the replaced or reprogrammed software have
been running concurrently for different systems. The testing and remediation
phase for all significant systems is expected to be completed by the end of
November 1999.
The Company has substantially completed working with third party vendors to
ensure that any of the Company's systems that interface directly with third
parties are Year 2000 compliant by November 30, 1999.
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<PAGE> 17
The Company has substantially completed querying its significant suppliers
and subcontractors that do not share information systems with the Company
("external agents"). To date, the Company is not aware of any external agent
with a Year 2000 issue that would materially impact the Company's results of
operations, liquidity, or capital resources although the Company understands
that certain fuel refiners may be particularly susceptible to disruption caused
by non-compliant embedded chips and that certain electrical power suppliers may
be similarly affected. The Company has no means of ensuring that external agents
will be Year 2000 ready. The inability of certain external agents, such as the
FAA, fuel refiners and suppliers generally, and electrical power suppliers, to
complete their Year 2000 resolution process in a timely fashion could materially
impact the Company. The effect of non-compliance by external agents is not
determinable.
The Company is utilizing both internal and external resources to reprogram
or replace, test, and implement the software and operating equipment for Year
2000 modifications. The total cost of the Year 2000 project is estimated at less
than $500,000 and is being funded through operating cash flows. As of October 1,
1999, the Company has incurred approximately $390,000 related to all phases of
the Year 2000 project. The remaining project costs relate to repair of hardware
and software and will be expensed as incurred.
Management of the Company believes it has an effective program in place to
resolve the Year 2000 issue in a timely manner. However, it is possible that the
Company's or third parties' systems and equipment could fail and result in the
reduction or suspension of the Company's operations. As noted above, the Company
has not yet completed all necessary phases of the Year 2000 program. Disruptions
in the economy generally resulting from Year 2000 issues could materially
adversely affect the Company. The amount of potential liability and lost revenue
cannot be reasonably estimated at this time.
The Company currently has no contingency plans in place in the event it does
not complete all phases of the Year 2000 program or for dealing with the most
reasonably likely worst case scenario. The Company plans to evaluate the status
of completion in November 1999 and determine whether such a plan is necessary.
If the Company's expectations or assessments of the impact of the Year 2000
issue prove to be incorrect, the Company's business may be materially affected.
SEASONALITY
Certain of the Company's customers engage in seasonal businesses, especially
the USPS and customers in the automotive industry. As a result, the Company has
historically experienced its highest quarterly revenues and profitability during
the fourth quarter of the calendar year due to the peak Christmas season
activity of the USPS and during the period from June 1 to November 30 when
production schedules of the automotive industry typically increase.
Consequently, the Company experiences its lowest quarterly revenue and
profitability during the first quarter of the calendar year.
FORWARD-LOOKING STATEMENTS
In addition to historical information, this Quarterly Report on Form 10-Q
contains forward-looking statements, which can be identified by the use of
forward looking terminology, such as "may," "will," "expect," "could,"
"anticipate," "estimate" or "continue" or the negative thereof or other
variations thereon or comparable terminology. These forward-looking statements
are subject to risks and uncertainties that could cause actual results to differ
materially from those referred to in the forward-looking statements. Factors
that might cause such a difference include, but are not limited to, those
discussed in "Item 7. Management's Discussion and Analysis of Financial
Condition and Results of Operations - Factors That May Affect Future Results" of
the Company's 1998 Annual Report on Form 10-K. Readers are cautioned not to
place undue reliance on these forward-looking statements, which reflect
management's analysis only as of the date hereof. We undertake no obligation to
publicly revise these forward-looking statements to reflect events or
circumstances that arise after the date hereof. Readers should carefully review
the risk factors described in other documents we file from time to time with the
Securities and Exchange Commission.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
For the period ended September 30, 1999, the Company did not experience any
material changes in market risk exposures that affect the quantitative and
qualitative disclosures presented in the Company's 1998 Annual Report on Form
10-K.
17
<PAGE> 18
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
Not applicable.
ITEM 2. CHANGES IN SECURITIES
Not applicable.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
Not applicable.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
Not applicable.
ITEM 5. OTHER INFORMATION
Not applicable.
ITEM 6. REPORTS ON FORM 8-K AND EXHIBITS
(a) Reports on Form 8-K:
Not applicable.
(b) Exhibits:
The following exhibits are filed herewith or are incorporated by reference from
previous filings with the Securities and Exchange Commission.
EXHIBIT NO. DESCRIPTION
3.1 - Certificate of Incorporation of the Company.(2)
3.2 - Amended and Restated Bylaws of the Company.(4)
3.3 - Amendment No. 1 to the Certificate of Incorporation of the
Company.(2)
4.1 - Specimen Common Stock Certificate.(3)
4.3 - Specimen Global Note in respect of 9.95% Senior Secured
Notes due 2004.(4)
4.4 - Indenture, dated November 17, 1997, in regard to 9.95%
Senior Secured Notes due 2004 by and among the Company and
certain of its subsidiaries and Bank One, N.A. as Trustee and
Collateral Trustee.(4)
4.5 - First Supplemental Indenture, dated February 5, 1998, in
regard to 9.95% Senior Secured Notes due 2004 by and among the
Company and certain of its subsidiaries and Bank One, N.A. as
Trustee and Collateral Trustee.(4)
10.1 - Agreement dated October 30, 1999, between Kitty Hawk
International, Inc. and the Pilots and Flight Engineers in the
service of Kitty Hawk International, Inc. as represented by
the International Brotherhood of Teamsters.(1)
18
<PAGE> 19
21.1 - Subsidiaries of the Registrant.(4)
27.1 - Financial Data Schedule.(1)
- -----------------
(1) Filed herewith.
(2) Previously filed as an exhibit to the Company's Registration Statement on
Form S-1 (Reg. No. 33-85698) dated as of December 1994, and incorporated
herein by reference.
(3) Previously filed as an exhibit to the Company's Registration Statement on
Form S-1 (Reg. No. 333-8307) dated as of October 1996, and incorporated
herein by reference.
(4) Previously filed as an exhibit to the Company's Registration Statement on
Form S-4 (Reg. No. 333-43645) dated as of February 1998, and incorporated
herein by reference.
19
<PAGE> 20
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Company has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized, on November 12, 1999.
KITTY HAWK, INC.
By: /s/ Richard R. Wadsworth
------------------------------
Richard R. Wadsworth, Jr.
Senior Vice President -
Finance,
Chief Financial Officer,
and Secretary
(Authorized officer and
principal financial and
accounting officer)
<PAGE> 21
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
------- -----------
<S> <C>
3.1 - Certificate of Incorporation of the Company.(2)
3.2 - Amended and Restated Bylaws of the Company.(4)
3.3 - Amendment No. 1 to the Certificate of Incorporation of the
Company.(2)
4.1 - Specimen Common Stock Certificate.(3)
4.3 - Specimen Global Note in respect of 9.95% Senior Secured
Notes due 2004.(4)
4.4 - Indenture, dated November 17, 1997, in regard to 9.95%
Senior Secured Notes due 2004 by and among the Company and
certain of its subsidiaries and Bank One, N.A. as Trustee and
Collateral Trustee.(4)
4.5 - First Supplemental Indenture, dated February 5, 1998, in
regard to 9.95% Senior Secured Notes due 2004 by and among the
Company and certain of its subsidiaries and Bank One, N.A. as
Trustee and Collateral Trustee.(4)
10.1 - Agreement dated October 30, 1999, between Kitty Hawk
International, Inc. and the Pilots and Flight Engineers in the
service of Kitty Hawk International, Inc. as represented by
the International Brotherhood of Teamsters.(1)
21.1 - Subsidiaries of the Registrant.(4)
27.1 - Financial Data Schedule.(1)
</TABLE>
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(1) Filed herewith.
(2) Previously filed as an exhibit to the Company's Registration Statement on
Form S-1 (Reg. No. 33-85698) dated as of December 1994, and incorporated
herein by reference.
(3) Previously filed as an exhibit to the Company's Registration Statement on
Form S-1 (Reg. No. 333-8307) dated as of October 1996, and incorporated
herein by reference.
(4) Previously filed as an exhibit to the Company's Registration Statement on
Form S-4 (Reg. No. 333-43645) dated as of February 1998, and incorporated
herein by reference.
<PAGE> 1
EXHIBIT 10.1
AGREEMENT BETWEEN
KITTY HAWK INTERNATIONAL, INC.
AND THE
PILOTS AND FLIGHT
ENGINEERS
IN THE SERVICE OF
KITTY HAWK INTERNATIONAL, INC.
AS REPRESENTED BY
THE INTERNATIONAL BROTHERHOOD OF TEAMSTERS,
AIRLINE DIVISION
This Agreement is made and entered into in accordance with the provisions of the
Railway Labor Act, as amended, by and between Kitty Hawk International, Inc.,
hereinafter known as the "Company" and the Pilots and Flight Engineers,
hereinafter known as the "Crewmembers", in the service of the Company as
represented by the International Brotherhood of Teamsters, Airline Division,
hereinafter known as the "Union".
<PAGE> 2
SECTION 1 - RECOGNITION, PURPOSE, SCOPE AND MERGERS
1.1. RECOGNITION
Pursuant to the certification by the National Mediation Board in Case
Numbers R-6152 (Pilots) and R-6145 (Flight Engineers) dated December
17, 1992, the Company recognizes the Union as the duly designated and
authorized representative of the Crewmembers in the employ of the
Company for the purposes of the Railway Labor Act, as amended.
1.2. PURPOSE OF AGREEMENT
In the mutual interests of the Crewmembers, the Union and the
Company, the purpose of this Agreement is to provide for orderly
collective bargaining relations between the Company and the Union, a
method for the prompt and equitable disposition of grievances, and a
method for the establishment of rates of pay, rules and working
conditions for the Crewmembers. In making this Agreement, it is
recognized to be the duty of the Union, the Crewmembers and the
Company to cooperate fully for the advancement of the purpose of this
Agreement.
1.3. SOLE AGREEMENT
This Agreement supersedes all existing or previously executed
agreements between the Company and the Union or any other labor
organization or individual with respect to the rates of pay, rules
and working conditions covered by this Agreement in accordance with
the provisions of the Railway Labor Act, as amended. Any and all
subsequent modifications to this Agreement will be reduced to
writing, signed by the appropriate authorized representatives, and
become a part of this Agreement.
1.4. SCOPE
1.4.1. FLYING PERFORMED BY CREWMEMBERS
All present and future flying performed in and for the
service of the Company under FAR Part 121, and all ferry
flights under FAR Part 91 for the purpose of positioning to
or depositioning from a revenue trip in aircraft listed by
tail number on the Company's Operations Specifications
issued by the FAA will be performed by full-time Crewmembers
on the Seniority Lists in accordance with the terms and
conditions of this Agreement. If the Company enters into
code sharing or interchange arrangements with other
airlines, Crewmembers will not be furloughed as a direct
result of such arrangements.
1.4.2. CREWMEMBERS TEMPORARILY ASSIGNED OUT OF SENIORITY
When short-term flying requirements or the introduction of
new or additional aircraft into service requires the
immediate use of current and qualified crewmembers and a
sufficient number of Crewmembers on the Seniority Lists are
not available, the Company may operate such aircraft with
Crewmembers temporarily assigned out of seniority.
Crewmembers temporarily assigned out of seniority will be
covered by the terms of this Agreement. Use of Crewmembers
temporarily assigned out of seniority will be subject to the
following:
-2-
<PAGE> 3
1.4.2.1. INTRODUCTION OF NEW AIRCRAFT
When the Company introduces new aircraft, up to
two hundred seventy (270) Days, unless mutually
extended by the Company and the Union.
1.4.2.2. INTRODUCTION OF ADDITIONAL AIRCRAFT
When the Company introduces additional aircraft,
up to one hundred eighty (180) Days.
1.4.2.3. SHORT-TERM FLYING REQUIREMENTS
When the Company has short-term flying
requirements, up to one hundred eighty (180)
Days.
1.4.2.4. TRAINING OF CREWMEMBERS
In the case of introduction of new aircraft or
introduction of additional aircraft, within the
time limits set forth in subsection 1.4.2.1. and
subsection 1.4.2.2., above, the Company will
conduct Training for Crewmembers who have been
awarded the positions held by Crewmembers
temporarily assigned out of seniority as soon as
practical, taking into account safety, crew
pairing and availability of Training support.
1.4.2.5. EXPIRATION OF TIME LIMITS
At the expiration of the time limits set forth
above or when the requirement for temporarily
assigned out-of-seniority Crewmembers ceases,
whichever is sooner, Crewmembers temporarily
assigned out-of-seniority will be displaced from
their out of seniority positions and those
positions will be filled in accordance with
Section 16.
1.4.2.6. PAY PROTECTION
Beginning with the successful completion of OE by
Crewmembers temporarily assigned out of
seniority, each Crewmember not upgraded or
transitioned because of the application of this
provision will be pay protected in seniority
order, on a one-for-one basis.
1.4.2.7. NO REDUCTIONS
No Crewmember will be reduced in Crew Class or
suffer any loss of MBPG or benefits as a result
of the use of such temporarily assigned
Crewmembers.
1.4.3. WET LEASE IN
If the Company's operational requirements necessitate the
Wet Lease of additional aircraft in order to provide service
to its customers or potential customers or the expansion of
its markets, the following applies:
1.4.3.1. UNION NOTIFICATION
The Company will notify the Union not less than
three (3) Days prior to the commencement of any
Wet Lease agreement of more than fifteen (15)
Days. The notification will include the reason(s)
for the lease, the aircraft to be utilized, the
hours of flying, the duration and the effect of
the Wet Lease on the Crewmembers.
-3-
<PAGE> 4
1.4.3.2. NO REDUCTIONS
No Crewmember covered by this Agreement on the
date of any Wet Lease will be reduced in Crew
Class or suffer any loss of MBPG or benefits as a
result of the Wet Lease agreement.
1.4.3.3. DURATION OF WET LEASE
A wet lease in will not exceed two hundred
seventy (270) consecutive Days, unless extended
by mutual agreement between the Company and the
Union.
1.5. SALE OR DRY LEASE OF COMPANY AIRCRAFT
The Company may sell or Dry Lease an aircraft to another air carrier
or entity when the Company is unable to obtain sufficient business to
operate the aircraft profitably. The Company will make a reasonable
effort to arrange with the buyer or lessee to provide for the
employment of a full or partial complement of Crewmembers. If the
Company's efforts fail, it will, upon request of the Union, indicate
in writing the reasons why such employment is unacceptable to the
buyer or lessee. If a furlough is necessary because of the sale or
Dry Lease of aircraft, the Company will provide the following
information to the Union: reasons for the sale or lease, duration of
the lease, the number of Crewmembers affected by Crew Class and Type,
the number of aircraft affected by the sale or lease.
1.6. MERGERS AND ACQUISITIONS
1.6.1. NOTICE OF MERGER OR ACQUISITION
If the Company enters into an agreement of merger or
acquisition with another air carrier or entity, it will
notify the Union in writing within three (3) Days after the
execution of such agreement, provided the Union executes any
required confidentiality agreements. The Company will give
written notice of the existence of this Agreement to the air
carrier or entity, with a copy to the Union within three (3)
Days after the execution of such agreement.
1.6.2. INTEGRATION OF SENIORITY LISTS
If the Company merges with, acquires or is acquired by
another air carrier and the merger or acquisition affects
the seniority rights of Crewmembers, provisions will be made
for the integration of Seniority Lists in a fair and
equitable manner as set forth below.
1.6.2.1. NEGOTIATIONS
The method of integration will be determined
through direct negotiations between
representatives designated by the Union and
representatives of the crewmembers from the
merged, acquired or acquiring air carrier.
1.6.2.2. ARBITRATION
Should negotiations to integrate the Seniority
Lists not be successfully concluded, the matter
will be referred to binding arbitration pursuant
to Sections 3 and 13 of the Allegheny-Mohawk
LPPs.
-4-
<PAGE> 5
1.6.2.3. FENCE AGREEMENT
The Company, the Union and representatives of the
crewmembers from the merged, acquired or
acquiring carrier will formulate a fence
agreement prior to the integration of the
Seniority Lists.
1.6.2.4. NO SYSTEM FLUSH
Implementation of integrated Seniority Lists or a
fence agreement will not result in a system
flush.
1.6.3. REPRESENTATION
If a merger or acquisition results in creating a single air
carrier, as that term has been used by the National
Mediation Board, representation of Crewmembers will be
determined by the National Mediation Board.
1.7. ALTER EGO
The Company will not establish a third-party leasing device to evade
the terms of this Agreement.
1.8. TRANSFER OF ASSETS
The Company will not transfer aircraft, routes or operating authority
to its Parent, a subsidiary of the Parent or a subsidiary of the
Company for the purpose of evading the terms of this Agreement. The
Company will not transfer aircraft to its Parent, a subsidiary of the
Parent or a subsidiary of the Company if the purpose of the transfer
is for the Parent, a subsidiary of the Parent or a subsidiary of the
Company to operate the aircraft, and the transfer causes a
Curtailment or furlough of Crewmembers. This subsection does not
prohibit such a transfer if the Company is unable to operate the
aircraft for reasons such as FAA, or other governmental, directives;
cessation of operations or causes beyond the control of the Company.
1.9. SUCCESSORSHIP AND ASSUMPTION OF AGREEMENT
This Agreement will be binding upon any successor of the Company
unless and until changed in accordance with the provisions of the
Railway Labor Act, as amended.
1.10 FOREIGN BASES
If the Company establishes a Base outside the United States,
Crewmembers assigned to such Base will be covered by the terms of
this Agreement and the Railway Labor Act, as amended.
-5-
<PAGE> 6
SECTION 2 - DEFINITIONS
"ACTIVE SERVICE" means all accumulated time, commencing with Date of Hire as a
Crewmember, for which the Crewmember is paid by the Company.
"ADEQUATE REST FACILITY" means a quiet, dark, climate-controlled room with
single beds, supplied with fresh linen, with access to clean restroom
facilities.
"ALOFT" means Block to Block.
"BASE" means the geographical point designated by the Company to which a
Crewmember is permanently assigned.
"BID LINE" means a Line of Flying, a Reserve Line or Composite Line.
"BID SENIORITY LIST" means a list of Crewmembers who are eligible to bid, listed
in Seniority order by Crew Class, Type and Base.
"BLOCK TO BLOCK" means the period of time from the moment the restraining
devices are removed from the aircraft for the purpose of flight, until the
restraining devices are installed at either the point of departure, an
intermediate stop, or the final destination. Block-to-Block time is used for,
but not limited to, scheduled arrival and departure times, duty period
calculations and Duty Time calculations. Block-to-Block time includes all time
aloft, taxi time and time that the aircraft is being positioned by a tug.
"CAPTAIN" means a Crewmember who is qualified to perform the function of pilot
in command, as designated by the Company, who is qualified to serve as Captain
under FAR Part 121 and this Agreement, and who holds a Crew Class bid award as a
Captain.
"CATEGORY" means the respective crew skill, Pilot or Flight Engineer, held by a
Crewmember.
"COMMUTE" means travel between a Crewmember's Residence Airport, or other
location, and his Base, or other location, not at the direction of the Company.
"COMPOSITE LINE" means a Bid Line containing Days free of duty, reserve Days and
Trip Sequences that become available as a result of vacation awards, Training,
leaves of absence, sick leave or Trip Sequences not contained in Lines of
Flying.
"CREW CLASS" means the respective job designation of a Crewmember within his
respective Category. Within the Category of Pilot exist the Crew Classes of
Captain and First Officer. Within the Category of Flight Engineer exist the Crew
Classes of Second Officer and Professional Flight Engineer.
"CREWMEMBER" means a Pilot or a Flight Engineer covered by this Agreement.
"CURTAILMENT" means a reduction in the number of positions within a Crew Class
on a specific Type at a specific Base.
"DATE OF HIRE" means the date a Crewmember commences initial Training by the
Company as a Crewmember, after the Crewmember has become employed by the
Company.
-6-
<PAGE> 7
"DAY" means a calendar day, measured from 0000Z to 2359Z.
"DEADHEAD" means the published, scheduled time spent by a Crewmember traveling,
not local in nature, from one point to another at the direction of the Company.
If there is no published scheduled time, Deadhead will be Block-to-Block time.
Deadhead will include time spent aloft and connection times.
"DISPLACEMENT" means removal of a Crewmember from his Crew Class, Type or Base
because of a Curtailment or another Crewmember's exercise of bumping rights.
"DOMESTIC" means the forty-eight (48) contiguous United States and the District
of Columbia.
"DRY LEASE" means the leasing of an aircraft without a flight crew.
"DUTY DAY" means a Day that a Crewmember is subject to the Company's direction.
"DUTY TIME" means that interval between the time a Crewmember is required to
report for duty and the time he is released by the Company.
"EFFECTIVE DATE" means, for a vacancy, the date that a Crewmember is expected to
begin performing duties in an awarded vacancy and, for a Curtailment, the date
that a Crewmember is expected to cease performing duties in a position.
"FAR" means the Federal Aviation Regulations.
"FIRST OFFICER" means a Crewmember who is qualified to perform the function of
second in command, as designated by the Company, who is qualified to serve as
First Officer under FAR Part 121 and this Agreement, and who holds a Crew Class
bid award as a First Officer.
"FLIGHT ENGINEER" means a Crewmember who is qualified to perform the function of
Flight Engineer, as designated by the Company, who is qualified to serve as a
Flight Engineer under FAR Part 121 and this Agreement, and who holds a Crew
Class bid award as a Flight Engineer.
"FLIGHT PAY" means the hourly rate of pay for performing the duties of a
Crewmember.
"FLIGHT SEGMENT" means a leg measured from block out to block in.
"FLIGHT TIME" means the time from the moment when the aircraft first moves under
its own power for the purpose of flight until the moment it comes to rest after
landing. Flight Time is used for FAR Flight Time limitations.
"INTERNATIONAL" means any point or area outside the forty-eight (48) contiguous
United States and the District of Columbia.
"LINE OF FLYING" means a Bid Line containing Trip Sequences and scheduled Days
free of duty.
"MANAGEMENT CREWMEMBER" means a Crewmember, designated by the Company, who
participates in the establishment or implementation of Company policies related
to flight operations or in the supervision of Crewmembers, including the making
of decisions affecting the status of Crewmembers, including discipline. Status
as Check Airman does not alone designate a Crewmember as a Management
Crewmember.
-7-
<PAGE> 8
"MINIMUM BID PERIOD GUARANTEE (MBPG)" means the minimum credit hours a
Crewmember will receive in a Bid Period.
"MONTH" means the period of time commencing with and including the first Day of
a calendar month up to and including the last Day of the month.
"OPEN TIME" means known flying that is not placed into Lines of Flying and
flying that becomes available for reasons such as Training, vacations, sick
leave, Bid Period-to-Bid Period transitions, ad hoc charter or other unforeseen
circumstances after completion of the bid awards.
"PILOT" means Captain or First Officer.
"POSITIONING OR DE-POSITIONING" means Deadhead.
"PRIOR RIGHTS FLIGHT ENGINEER" means a Crewmember who was listed on the Flight
Engineers' Seniority List on the date of ratification of this Agreement and so
indicated on the Flight Engineers' Seniority List.
"PROFESSIONAL FLIGHT ENGINEER" means a Crewmember who is qualified to perform
the function of a Flight Engineer, as designated by the Company, who holds an
Airframe and Powerplant Mechanic Certificate, who is qualified to serve as a
Flight Engineer under FAR Part 121 and this Agreement and has been designated by
the Company to perform maintenance on Company aircraft and who holds a Crew
Class bid award as a Flight Engineer.
"RECURRENT TRAINING" means all FAA-mandated Training required to maintain
qualification and currency, excluding remedial Training and re-qualification
Training after a Training failure.
"RESERVE CREWMEMBER" means a Crewmember who is awarded or assigned to a Reserve
Line or who is serving on a designated reserve day as part of a Line of Flying
or a Composite Line or who is temporarily assigned to reserve in accordance with
this Agreement.
"RESERVE LINE" means a Bid Line containing reserve Days and scheduled Days free
of Duty.
"RESIDENCE AIRPORT" means the airport, designated by a Crewmember, served by a
scheduled air carrier, where a Crewmember is considered to reside.
"SECOND OFFICER" means a Crewmember who is qualified to perform the function of
Flight Engineer, as designated by the Company, who is qualified to serve as a
Flight Engineer under FAR Part 121 and this Agreement, and who holds a Crew
Class bid award as a Second Officer. A Second Officer must possess a Commercial
Pilot Certificate with Multi-Engine and Instrument ratings and is not required
to possess an Airframe and Powerplant Mechanic Certificate.
"SENIORITY LIST(S)" means a listing of Crewmembers, as set forth in Section 15,
according to Date of Hire.
"STANDING BID" means a bid that reflects a Crewmember's preference(s) for
Category, Crew Class, Type and Base.
-8-
<PAGE> 9
"TRAINING" means classroom, simulator and flight Training including, but not
limited to, Initial, Transition, Recurrent, Proficiency, Upgrade and
Differences.
"TRIP SEQUENCE" means a series of Flight Segments, including Deadheading, with
the initial segment departing from a Crewmember's Base and the final segment
arriving at the Crewmember's Base. A Trip Sequence may begin in one Bid Period
and end in the following Bid Period. A Trip sequence may start and end at a
location other than a Crewmember's Base, provided that both the starting and
ending locations are the same. Deadhead between two Trip Sequences is a Trip
Sequence.
"TYPE" means the type of aircraft, as defined by the FARs, operated by the
Company, designated by manufacturer and model.
"WET LEASE" means the leasing of aircraft with a flight crew.
-9-
<PAGE> 10
SECTION 3 - UNION SECURITY
3.1. UNION MEMBERSHIP
It will be a condition of employment for all Crewmembers covered by
this Agreement on or before the ninetieth (90th) Day following their
Date of Hire to tender to the Union directly the required initiation
fees. It will also be a condition of employment that all Crewmembers
become and remain members in good standing in the Union, or in the
alternative, tender to the Union the Monthly dues required of the
Union members, such sums to be recognized as a service fee. It will
also be a condition of employment that all Crewmembers tender to the
Executive Council Monthly assessments required of Crewmembers.
3.2. INITIATION FEES AND DUES OR SERVICE FEES AND ASSESSMENTS DEDUCTION
The Company will deduct from the wages of any Crewmember covered by
this Agreement dues as a member of the Union, or the service fee, the
Executive Council assessment and the Teamsters Legal Services Plan
fee, upon receiving the Crewmember's voluntary and individual written
authorization for the Company to make such deductions. The
authorization forms will be provided by the Union. No Crewmember will
be deprived of employment under this Section for any reason other
than failure to tender initiation fees and failure to pay the Monthly
dues which are uniformly required as a condition of acquiring and
retaining membership in the Union, or service fees which will be not
more than the dues and initiation fees, or Executive Council
assessments. The Company will deduct dues or service fees and
Executive Council assessments in the Month in which a Crewmember is
recalled from furlough or returns from a leave of absence. If a
Crewmember is recalled from furlough or returns from a leave of
absence after the dues or service fees and Executive Council
assessments have been deducted for the Month, the Company will be
permitted to make a double deduction in the following Month.
3.2.1. TRANSFER OF DUES OR SERVICE FEES TO UNION
The Company will pay to the proper officers of the Union the
withheld dues or service fees. The Company will also pay to the
proper officers of the Executive Council the withheld
assessments. The Monthly dues or service fees will be deducted
from the first paycheck in each Month and paid to the Union
within seven (7) Days of the issuance of the paychecks. The
Teamsters Legal Services Plan fee and the Executive Council
assessments will be deducted from the second paycheck in each
Month and paid to the Union within seven (7) Days of the
issuance of paychecks. The following information will be
reported and transmitted with each payment: Social security
number, full name, amount of dues or service fees or
assessments, rate of pay and status of employment.
3.2.2. INDEMNIFICATION CLAUSE
The Union will indemnify the Company and hold the Company
harmless from any and all claims that may be made by Crewmembers
against the Company by virtue of the wrongful application or
misapplication of any of the terms of this Section.
-10-
<PAGE> 11
3.2.3. DUES OR SERVICE FEES AND ASSESSMENTS AFTER TERMINATION
In the event of the termination of a Crewmember's
employment, there will be no obligation for the Company to
collect dues, or service fees, or assessments until all
other deductions have been made.
3.2.4. DEDUCTION ERROR
If a deduction is missed, or if an insufficient amount is
deducted, it is the Crewmember's responsibility to make the
proper adjustment with the Union.
3.3. FAILURE TO PAY DUES OR SERVICE FEES AND ASSESSMENTS
Written notice will be given to the Company by the Union at least
thirty (30) days before the Company is required to remove a
Crewmember from employment for failure to maintain membership in good
standing in the Union, or pay service fees, or assessments in
accordance with subsection 3.1.
3.4. CREWMEMBER LIST
The Company will notify the Union each Month of all new-hires,
terminations, recalls or furloughs. The notification will include the
Crewmember's name, address, social security number, Crew Class and
Date of Hire, termination, recall or furlough.
-11-
<PAGE> 12
SECTION 4 - MANAGEMENT RIGHTS
The Company retains the sole and exclusive right to operate, control and manage
its business and exercise all traditional management rights, powers and
authority it had prior to signing this Agreement, except those modified
specifically by an express provision of this Agreement. Included by way of
description, and not by way of limitation, are rights to direct the working
force and determine its size and composition; maintain order and efficiency;
hire, transfer, and promote Crewmembers and discipline, suspend, and discharge
for cause; assign work to Crewmembers; extend, maintain, curtail or terminate
its operations in whole or part; determine the nature and extent of services to
be rendered; determine the business concerns with whom it will deal and the
customers it wishes to serve; establish and enforce quality standards for its
services; determine and change methods, processes and techniques of operation;
determine when and if vacancies will be filled; establish and modify reasonable
rules and regulations and require observance thereof. A right of management will
not be impaired or waived by any contrary course of conduct.
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<PAGE> 13
SECTION 5 - COMPENSATION
5.1. NEW-HIRE PAY
A new-hire Crewmember who receives Training prior to his
qualification as a Crewmember will be paid five hundred dollars
($500.00) per week while in Training. A new-hire Crewmember will not
receive Flight Pay until he completes OE.
5.2. FLIGHT PAY RATES
A Crewmember will be paid Flight Pay in United States Dollars in
accordance with the following schedules:
5.2.1. CAPTAINS
<TABLE>
<CAPTION>
--------------------------------------------------------------------------------
Year of Active Effective Effective Effective Effective
Service October 16 October 16 October 16 October 16
1999 2000 2001 2002
--------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
1ST 60.00 60.00 60.00 60.00
--------------------------------------------------------------------------------
2ND 82.00 84.46 87.84 91.79
--------------------------------------------------------------------------------
3RD 95.00 97.85 101.76 106.34
--------------------------------------------------------------------------------
4TH 98.00 100.94 104.98 109.70
--------------------------------------------------------------------------------
5TH 102.00 105.06 109.26 114.18
--------------------------------------------------------------------------------
6TH 105.00 108.15 112.48 117.54
--------------------------------------------------------------------------------
7TH 108.00 111.24 115.69 120.90
--------------------------------------------------------------------------------
8TH 111.00 114.33 118.90 124.25
--------------------------------------------------------------------------------
9TH 114.00 117.42 122.12 127.61
--------------------------------------------------------------------------------
10TH 117.00 120.51 125.33 130.97
--------------------------------------------------------------------------------
11TH 120.00 123.60 128.54 134.33
--------------------------------------------------------------------------------
12TH 122.50 126.18 131.22 137.13
--------------------------------------------------------------------------------
13TH 124.50 128.24 133.36 139.37
--------------------------------------------------------------------------------
14TH 126.00 129.78 134.97 141.04
--------------------------------------------------------------------------------
15TH 127.50 131.33 136.58 142.72
--------------------------------------------------------------------------------
16TH 128.50 132.36 137.65 143.84
--------------------------------------------------------------------------------
17TH 129.50 133.39 138.72 144.96
--------------------------------------------------------------------------------
18TH 130.50 134.42 139.79 146.08
--------------------------------------------------------------------------------
19TH 131.50 135.45 140.86 147.20
--------------------------------------------------------------------------------
20TH 132.50 136.48 141.93 148.32
--------------------------------------------------------------------------------
</TABLE>
Notes: The Company may modify first year pay rates at its
discretion.
There will be no longevity increases for Captains
after the twentieth (20th) year of Active Service.
The maximum Flight Pay rate for a narrow body
Captain will be the rate for the ninth (9th) year
of Active Service.
-13-
<PAGE> 14
5.2.2. PROFESSIONAL FLIGHT ENGINEERS
<TABLE>
<CAPTION>
---------------------------------------------------------------------------------
Year of Active Effective Effective Effective Effective
Service October 16 October 16 October 16 October 16
1999 2000 2001 2002
---------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
1ST 45.00 45.00 45.00 45.00
---------------------------------------------------------------------------------
2ND 61.50 63.35 65.88 68.84
---------------------------------------------------------------------------------
3RD 71.25 73.39 76.32 79.76
---------------------------------------------------------------------------------
4TH 73.50 75.71 78.73 82.28
---------------------------------------------------------------------------------
5TH 76.50 78.80 81.95 85.63
---------------------------------------------------------------------------------
6TH 78.75 81.11 84.36 88.15
---------------------------------------------------------------------------------
7TH 81.00 83.43 86.77 90.67
---------------------------------------------------------------------------------
8TH 83.25 85.75 89.18 93.19
---------------------------------------------------------------------------------
9TH 85.50 88.07 91.59 95.71
---------------------------------------------------------------------------------
10TH 87.75 90.38 94.00 98.23
---------------------------------------------------------------------------------
11TH 90.00 92.70 96.41 100.75
---------------------------------------------------------------------------------
12TH 91.88 94.63 98.42 102.85
---------------------------------------------------------------------------------
13TH 93.38 96.18 100.02 104.52
---------------------------------------------------------------------------------
14TH 94.50 97.34 101.23 105.78
---------------------------------------------------------------------------------
15TH 95.63 98.49 102.43 107.04
---------------------------------------------------------------------------------
16TH 96.38 99.27 103.24 107.88
---------------------------------------------------------------------------------
17TH 97.13 100.04 104.04 108.72
---------------------------------------------------------------------------------
18TH 97.88 100.81 104.84 109.56
---------------------------------------------------------------------------------
19TH 98.63 101.58 105.65 110.40
---------------------------------------------------------------------------------
20TH 99.38 102.36 106.45 111.24
---------------------------------------------------------------------------------
</TABLE>
Notes: The Company may modify first year pay rates at its discretion.
There are no longevity increases for Professional
Flight Engineers after the twentieth (20th) year of
Active Service.
The maximum Flight Pay rate for a narrow body
Professional Flight Engineer will be the rate for
the ninth (9th) year of Active Service.
-14-
<PAGE> 15
5.2.3. FIRST OFFICERS
<TABLE>
<CAPTION>
---------------------------------------------------------------------------------
Year of Active Effective Effective Effective Effective
Service October 16 October 16 October 16 October 16
1999 2000 2001 2002
---------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
1st 40.80 40.80 40.80 40.80
---------------------------------------------------------------------------------
2nd 55.76 57.43 59.73 62.42
---------------------------------------------------------------------------------
3rd 64.60 66.54 69.20 72.31
---------------------------------------------------------------------------------
4th 66.64 68.64 71.38 74.60
---------------------------------------------------------------------------------
5th 69.36 71.44 74.30 77.64
---------------------------------------------------------------------------------
6th 71.40 73.54 76.48 79.93
---------------------------------------------------------------------------------
7th 73.44 75.64 78.67 82.21
---------------------------------------------------------------------------------
8th 75.48 77.74 80.85 84.49
---------------------------------------------------------------------------------
9th 77.52 79.85 83.04 86.78
---------------------------------------------------------------------------------
10th 79.56 81.95 85.22 89.06
---------------------------------------------------------------------------------
</TABLE>
Notes: The Company may modify first year pay rates at its
discretion.
There are no longevity increases for First
Officers after the tenth (10th) year of Active
Service.
The maximum Flight Pay rate for a narrow body
First Officer will be the rate for the ninth (9th)
year of Active Service.
A Professional Flight Engineer who upgrades to
First Officer will not suffer any loss of pay and
will remain at his greater rate of pay until the
pay rate shown above exceeds such greater rate, at
which time he will be paid according to the
schedule above.
5.2.4. SECOND OFFICERS
<TABLE>
<CAPTION>
---------------------------------------------------------------------------------
Year of Active Effective Effective Effective Effective
Service October 16 October 16 October 16 October 16
1999 2000 2001 2002
---------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
1st 33.00 33.00 33.00 33.00
---------------------------------------------------------------------------------
2nd 45.10 46.45 48.31 50.49
---------------------------------------------------------------------------------
3rd 52.25 53.82 55.97 58.49
---------------------------------------------------------------------------------
4th 53.90 55.52 57.74 60.34
---------------------------------------------------------------------------------
5th 56.10 57.78 60.09 62.80
---------------------------------------------------------------------------------
</TABLE>
Notes: The Company may modify first year pay rates at its
discretion.
There are no longevity increases for Second
Officers after the fifth (5th) year of Active
Service.
A Pilot who transitions to Second Officer will
receive fifty-five percent (55%) of the Captain's
pay rate for his year of Active Service.
5.3. FLIGHT PAY COMPUTATION
The departure Day for a Flight Segment will be the Day on which all
Flight Pay for that Flight Segment will be credited.
5.3.1. FLIGHT PAY
Flight Pay credit will be computed on the basis of actual
Block-to-Block time.
-15-
<PAGE> 16
5.4. CHECK AIRMAN OVERRIDE
A Check Airman will be paid a minimum override of fifteen dollars
($15.00) per hour for all hours flown or credited, regardless of
whether actual instructor or Check Airman duties are being performed.
MBPG will be paid including Check Airman override. Any increase in
the Check Airman override will be applied uniformly.
5.5. INSTRUCTOR PAY
5.5.1. GROUND SCHOOL INSTRUCTION
When a Crewmember performs ground school instruction, he
will be paid a minimum of ten dollars ($10.00) per classroom
hour. Any increase in the ground school instructor rate will
be applied uniformly.
5.5.2. SIMULATOR INSTRUCTION
When a Crewmember, who is not a Check Airman, performs
simulator instruction he will be paid a minimum override of
fifteen dollars ($15.00) per simulator hour, including
briefing and de-briefing. Any increase in the simulator
instructor override will be applied uniformly.
5.6. REPORT PAY
When a Crewmember reports to the field for the purpose of flight
and does not fly, he will be credited one (1) hour of Flight Pay for
each four (4) hours of duty or fraction thereof, with a minimum of
one (1) hour's credit per occurrence.
5.7. MINIMUM PAY CREDIT
When a Crewmember reports to the field for the purpose of flight and
does fly, he will be credited with actual Block Time. If the Flight
Pay credit is less than one (1) hour, the Crewmember will be credited
with one (1) of hour of Flight Pay.
5.8. TAXI PAY
5.8.1. REPORT FOR TAXI ONLY
When a Crewmember reports to the field for the purpose of
repositioning an aircraft and not for the purpose of flight,
the Crewmember will be credited for all Block to Block time
with a minimum of one (1) hour of Flight Pay.
5.8.2. WITHIN A DUTY PERIOD
When a Crewmember is required to reposition an aircraft
within the same duty period as a flight, the Crewmember will
be credited for the Block to Block time.
5.9. PAY ON A SCHEDULED DUTY FREE DAY
5.9.1. DAYS OFF
When a Crewmember performs duty other than Training on a
scheduled duty free Day, he will be paid four point two
(4.2) hours of Flight Pay, or the actual hours credited for
the Day, whichever is greater, in addition to MBPG.
-16-
<PAGE> 17
5.9.2. JUNIOR ASSIGNMENT
When a Crewmember is junior assigned he will be paid as set
forth in subsection 5.9.1., multiplied by one point two five
(1.25). Effective November 1, 2000, when a Crewmember is
junior assigned he will be paid as set forth in subsection
5.9.1., multiplied by one point five (1.5).
5.10. DEADHEAD PAY
For Deadhead Pay, refer to Section 22.
5.11. TRAINING PAY
5.11.1. RECURRENT AND ADDITIONAL REQUIREMENT TRAINING
5.11.1.1. SCHEDULED DUTY DAYS
When a Crewmember is required to attend (not home
study) recurrent Training, a recurrent
proficiency check or Training for additional
requirements to maintain his qualification, e.g.,
TCAS or passenger qualification, or Check Airman
meetings on a scheduled Duty Day, he will be
credited with three point five (3.5) hours of
Flight Pay for each Day of such Training. A
Crewmember Deadheading to or from Training on a
scheduled Duty Day will be credited with either
all pay credit earned or three point five (3.5)
hours of Flight Pay, whichever is greater. When a
Crewmember's recurrent Training is interrupted or
he receives one Day off in seven Days as a result
of recurrent Training on a scheduled Duty Day, he
will be credited with three point five (3.5)
hours of Flight Pay for such Day.
5.11.1.2. SCHEDULED DUTY FREE DAYS
When a Crewmember is required to attend (not home
study) recurrent Training, a recurrent
proficiency check or Training for additional
requirements to maintain his qualification, e.g.,
TCAS or passenger qualification, or Check Airman
meetings on a scheduled duty free Day, he will be
paid four point two (4.2) hours of Flight Pay for
each Day of such Training, in addition to MBPG. A
Crewmember Deadheading to or from Training on a
scheduled duty free Day will be paid either all
pay credit earned or four point two (4.2) hours
of Flight Pay, whichever is greater, in addition
to MBPG. When a Crewmember's recurrent Training
is interrupted or he receives one Day off in
seven Days on a scheduled duty free Day as a
result of recurrent Training, he will be paid
four point two (4.2) hours of Flight Pay for such
Day, in addition to MBPG.
5.11.2. INITIAL, TRANSITION AND UPGRADE
When a Crewmember attends Initial (but not new-hire
initial), transition or upgrade Training, he will be paid
his pro rated MBPG for the Type and Crew Class for which he
is current and qualified.
-17-
<PAGE> 18
5.11.3. PILOT TO FLIGHT ENGINEER TRANSITIONS
A Pilot who has not exceeded the FAA-mandated retirement age
for Pilots at the time his Training commences will be paid
no less than his pro-rated MBPG for the Type and Crew Class
for which he is current and qualified while being trained. A
Pilot who has exceeded the FAA-mandated retirement age for
Pilots at the time his Training commences will be paid six
hundred sixty dollars ($660) per week while in Training. A
Pilot who is awarded a class that commences prior to
reaching the FAA-mandated retirement age for Pilots and has
his Training delayed by the Company will be paid no less
than his pro-rated MBPG for the Type and Crew Class held at
the time he reaches the FAA -mandated retirement age for
Pilots until his Training is completed. A Pilot who is
awarded a class date that commences not more than sixty (60)
days prior to his reaching the FAA-mandated retirement age
for Pilots and bypasses that class for another class that
commences prior to his reaching the FAA-mandated retirement
age for Pilots will be paid no less than his pro-rated MBPG
for the Type and Crew class for which he is current until he
reaches the FAA-mandated retirement age for Pilots and
thereafter will be paid six hundred and sixty dollars ($660)
per week while in Training.
5.11.4. REMEDIAL TRAINING
A Crewmember will not be paid Training pay for additional
Training or checking caused by a Training failure.
5.12. MAINTENANCE PAY
When a Crewmember performs maintenance in addition to his normal
duties on the aircraft, he will be paid fifteen dollars ($15.00) per
hour or fraction thereof, in addition to all other compensation.
5.13. MINIMUM BID PERIOD GUARANTEE (MBPG)
The MBPG is fifty-six (56) Flight Pay hours in a Bid Period. If a
Crewmember is unavailable for duty for a portion of a Bid Period, the
MBPG will be pro-rated.
5.14. BONUS INCENTIVE PLAN
Effective January 1, 2000, a bonus incentive plan will be
implemented. The plan will be no less favorable than that provided to
other Company employee groups. The plan may be terminated or modified
by the Company in accordance with the terms of the plan provided that
such modification will be no less favorable than modifications made
to the plans provided to other Company employee groups.
5.15. GENERAL
5.15.1. PAYROLL SCHEDULE
Crewmembers will be paid bi-weekly. The first paycheck of
the Bid Period will contain one-half (1/2) of the applicable
MBPG earned during the prior Bid Period. The second paycheck
of the Bid Period will contain one-half (1/2) of the
applicable MBPG earned during the current Bid Period plus
adjustments such as additional compensation earned in the
prior Bid Period. Unless otherwise required by applicable
law, a furloughed Crewmember will be paid all pay due him on
the first paycheck that covers the pay period in which he
was furloughed.
-18-
<PAGE> 19
5.15.2. PAYCHECK DELIVERY AND DEPOSIT
Upon written request, the Company will mail a Crewmember's
paycheck to a specified address, other than a bank. The
Company must receive such request at least thirty (30) Days
before the paycheck is due. The Company will provide
electronic direct deposit of paychecks. When electronic
direct deposit of per diem and expense checks becomes
available to other Company employees, the Company will
provide the service for Crewmembers.
5.15.3. JURY DUTY
A Crewmember who is required to serve on jury duty will
receive no reduction in his MBPG for up to five (5) Duty
Days of jury duty, per occurrence. Any jury pay received
during the five (5) Days will be reimbursed to the Company.
A Crewmember who receives notice of jury duty will
immediately inform the Director of Operations, or his
designee, and will cooperate with the Company in obtaining a
postponement or release from jury duty, if required. Any
transportation required to attend jury duty is the
responsibility of the Crewmember.
5.15.4. SPECIAL PROJECTS
A Crewmember who performs a special project for the Company
will be compensated at an individually negotiated rate.
-19-
<PAGE> 20
SECTION 6 - EXPENSES, LODGING AND TRANSPORTATION
6.1. PER DIEM
6.1.1. DOMESTIC
Per Diem for Domestic duty will be paid at the rate set
forth below:
<TABLE>
<CAPTION>
--------------------------------------------------------------------------------
EFFECTIVE DATE RATE
--------------------------------------------------------------------------------
<S> <C> <C>
November 1, 1999 $1.50
--------------------------------------------------------------------------------
November 1, 2000 $1.60
--------------------------------------------------------------------------------
November 1, 2001 $1.65
--------------------------------------------------------------------------------
November 1, 2002 $1.70
--------------------------------------------------------------------------------
</TABLE>
Except as provided in subsection 17.3.3., Domestic per diem
will commence when a Crewmember is required to report for
duty at his Base or depart his Residence Airport, if
applicable, until the Crewmember is released from duty at
his Base or is returned to his Residence Airport, if
applicable.
6.1.2. INTERNATIONAL
Per Diem for International duty will be paid at the rate set
forth below:
<TABLE>
<CAPTION>
--------------------------------------------------------------------------------
EFFECTIVE DATE RATE
--------------------------------------------------------------------------------
<S> <C> <C>
November 1, 1999 $2.05
--------------------------------------------------------------------------------
November 1, 2000 $2.15
--------------------------------------------------------------------------------
November 1, 2001 $2.25
--------------------------------------------------------------------------------
November 1, 2002 $2.35
--------------------------------------------------------------------------------
</TABLE>
International Per Diem will be paid while a Crewmember is on
assignment outside the contiguous forty-eight (48) United
States, commencing at block out from the last Domestic
airport and ending at block in at the first Domestic
airport. In addition, an extended layover override of fifty
cents ($0.50) per hour will be paid for all International
layovers that exceed seventy-two (72) hours. The extended
layover override will begin at the seventy-third (73rd) hour
and end at block out from the layover station.
6.1.3. NEW HIRE TRAINING
A new-hire Crewmember who receives Training prior to his
qualification as a Crewmember will not be paid per diem
until completion of OE.
6.1.4. PAYMENT
Per Diem will be paid no later than the end of the Bid
Period following the Bid Period in which it was earned.
6.2. LODGING
Except as provided in subsection 17.3.3., when a Crewmember is away
from his Base, the Company will designate and provide suitable single
occupancy lodging in a location convenient to the airport when the
Company determines it is necessary or when a scheduled layover or
anticipated delay is greater than six (6) hours, block in to block
out. The Company will consult periodically with the Union Hotel
Committee to discuss the suitability of lodging and will give
reasonable consideration to the recommendations of the committee. The
Company will pay for lodging, tax, and Company-related telephone
calls or faxes. All other incidental charges will be paid by the
Crewmember when checking out.
-20-
<PAGE> 21
6.2.1. NEW HIRE TRAINING
A new-hire Crewmember who receives Training prior to his
qualification as a Crewmember will not be provided lodging
until completion of OE.
6.3. LOCAL TRANSPORTATION
When the Company is required to provide lodging, the Company will
provide transportation between the airport and the place of lodging.
When transportation is not provided by the Company within one (1)
hour after block in, a Crewmember may use any available means of
transportation to the place of lodging and will be reimbursed for
expenses substantiated by receipts.
6.4. RENTAL CAR
If approved by the Director of Operations, or his designee,
Crewmembers on layover greater than forty-eight (48) hours may rent a
car, limited to one (1) car per crew. Moving violations and parking
tickets and all other incurred expenses in connection with such
rental cars are the responsibility of the Crewmember.
6.5. PERSONAL VEHICLE
If a Crewmember is authorized to use his vehicle on Company business,
he will be reimbursed at the current Company rate, but not less than
twenty-nine ($.29) cents per mile and for necessary tolls
substantiated by receipts. The Crewmember must indicate the
origination and termination points of travel and must properly submit
the expense for payment.
-21-
<PAGE> 22
SECTION 7 - MOVING EXPENSES
7.1. ELIGIBILITY
A Crewmember may move at Company expense under any of the following
circumstances, provided he moves to within one hundred (100) miles of
his new Base from a point beyond one hundred (100) miles of his new
Base:
7.1.1. NEW BASE AWARD
When a Crewmember is awarded a vacancy at a new Base as a
result of the initial bid to that Base.
7.1.2. INVOLUNTARY BASE ASSIGNMENT
When a Crewmember (except a new-hire Crewmember who is being
assigned to his first Base) is involuntarily assigned to
fill a Base vacancy as a result of insufficient bidders.
7.1.3. BASE DISPLACEMENT
When a Crewmember's move is the result of his Displacement
from a Base.
7.1.4. RECALL TO A DIFFERENT BASE
When a furloughed Crewmember is recalled to a different Base
than that from which he was furloughed.
7.2. COORDINATION WITH COMPANY
Prior to committing for a move, a Crewmember must coordinate the move
with the Company.
7.3. MOVING EXPENSES
A Crewmember will be reimbursed for the following expenses, provided
he moves his primary residence within one (1) year after being
eligible:
7.3.1. PERSONAL
Actual moving expenses, including insurance and other normal
costs, for up to a maximum of fifteen thousand (15,000)
pounds of household effects, including yard and workshop
tools, motorcycles and lawn equipment. Moving expenses for
household effects must be substantiated by receipts.
7.3.2. VEHICLES
When a Crewmember drives his vehicle(s) from his former
residence to his new residence, the rate of reimbursement
will be at the current Company rate, but not less than
twenty-nine ($.29) cents per mile, for the most direct AAA
mileage between such points for the first two (2)
automobiles. The Company will reimburse the Crewmember for
the reasonable and actual expenses of meals and lodging for
the Crewmember and his family for the time spent in travel
to his new residence. A day of travel will be four hundred
(400) miles by the most direct AAA mileage. All lodging will
be the quality of that used on Crewmember layovers.
-22-
<PAGE> 23
7.3.3. MOBILE HOMES
A Crewmember owning and living in a mobile home who moves
such mobile home to his new Base will be allowed actual
moving expenses, provided those expenses do not exceed the
amount provided for in subsections 7.3.1.
and 7.3.2., above.
7.4. ACCOMMODATIONS IN LIEU OF MOVING EXPENSES
If a Crewmember eligible for moving expenses elects not to move to
his new Base, the Company will provide lodging and per diem in
accordance with subsection 17.3.3. at his new Base. If a Crewmember
exercises this subsection and subsequently moves, the cost of lodging
and per diem will be deducted from the reimbursable moving expenses.
7.5. NEW-HIRE CREWMEMBERS
A new-hire Crewmember will not be eligible for moving expenses when
reporting to his initial Base assignment or award.
-23-
<PAGE> 24
SECTION 8 - SICK LEAVE
8.1. ACCRUAL
A new-hire Crewmember will be credited with seven (7) Days of sick
leave but will not accrue additional sick leave until the completion
of one (1) year of Active Service. Upon completion of one (1) year of
Active Service, a Crewmember will accrue sick leave at the rate of
seven-thirteenths (.54) of a Day for each Bid Period of Active
Service to a maximum of forty-two (42) Days.
8.2. SICK LEAVE PAY
8.2.1. BANK DEBIT
A Crewmember's sick leave bank will be debited the lesser of
one (1) Day for each Day on sick leave or, at a rate of
three point five (3.5) hours per Day, the number of whole
Days necessary to bring him to MBPG. The sick leave bank of
a Crewmember who has exceeded his MBPG at the time he
becomes unavailable for duty because of illness or injury
will be debited one (1) Day of sick leave as an
administrative charge, regardless of the number of Days that
he is unavailable for duty. At no time will sick leave
result in payment that exceeds a Crewmember's MBPG.
8.2.2. SCHEDULED DUTY DAYS
A Crewmember will not be charged sick leave on a scheduled
duty free Day.
8.3. SICK LEAVE USAGE
8.3.1. CREW SCHEDULING CONTACT
A Crewmember will contact Crew Scheduling at least every
third (3rd) consecutive duty Day missed because of illness
or injury. A Crewmember need not comply with the preceding
sentence if he specifies a specific period of time for the
absence because of the nature of the illness or injury. A
Crewmember must report when he is available for duty.
8.3.2. EXCLUSIONS
A Crewmember will not be entitled to sick leave when illness
or injury is a result of the Crewmember's willful disregard
of accepted safety practices, willful intention to injure
himself or another, illness or injury while in the employ of
another employer, the abuse of alcohol or the use of illegal
drugs.
8.3.3. WORKER'S COMPENSATION
If an illness or injury is occupationally related, sick
leave may be used to augment workers compensation income
replacement benefits. The combination of sick leave and
workers compensation income replacement will not exceed a
Crewmember's MBPG.
-24-
<PAGE> 25
8.4. SICK LEAVE BANK REPLENISHMENT
Within the two (2) Bid Periods following the Bid Period in which a
Crewmember uses sick leave, he may have his sick leave bank
replenished, on a Day for a Day basis, by performing duty pursuant
to subsection 20.4.1.5. A Crewmember must notify Crew Scheduling at
the time he accepts Open Time of his intent to replenish his sick
leave bank. If the Crewmember is assigned a Trip Sequence containing
more Days than his sick leave bank was debited, the remaining Days
will be paid in accordance with subsection 5.9.
8.5. DISABILITY
A Crewmember may use his accrued sick leave to supplement his
short-term disability benefits provided for in subsection 10.4. The
sum of sick leave and short-term disability benefits will not exceed
a Crewmember's MBPG.
8.6. PHYSICIAN'S STATEMENTS
The Company may require a physician's statement, which will state, at
a minimum, the nature of the illness or injury and the expected
duration of the Crewmember's inability to perform his duties to
substantiate illness or injury. The Company may also require a
physician's statement authorizing return to duty. If the Crewmember
is required to visit a physician designated by the Company, the
Company will pay for the examination.
8.7. VACATION CONCURRENT WITH ILLNESS
A Crewmember on sick leave when his scheduled vacation commences will
be removed from sick leave during the vacation and, if scheduled for
duty, returned to sick leave at the end of the vacation if the
illness or injury continues.
8.8. RETIREMENT
On or after reaching the FAA-required retirement age for Pilots, the
Company will pay a Crewmember fifty percent (50%) of any accrued sick
leave at the time of his retirement at the hourly rate that the
Crewmember held at retirement.
8.9. GENERAL
8.9.1. RECALL
A recalled Crewmember will retain all unused sick leave
accrued prior to the furlough.
8.9.2. STATEMENTS
Each Crewmember's pay statement will show unused accrued
sick leave.
8.9.3. OUTSIDE WORK
A Crewmember will not work for any other employer while on
sick leave.
8.9.4. SENIORITY AND LONGEVITY
A Crewmember on sick leave will continue to accrue seniority
and longevity.
8.9.5. RESUMPTION OF DUTY
A Crewmember returning from sick leave will be returned to
his assigned duty at the earliest, reasonable opportunity.
The Company may assign the Crewmember to reserve until he is
returned to his assigned duty.
-25-
<PAGE> 26
SECTION 9 - VACATION
9.1. ACCRUAL
Upon completion of one (1) year of Active Service, a Crewmember will be
credited with fourteen (14) days of vacation.
A Crewmember will accrue vacation based on Active Service in accordance
with the following:
<TABLE>
<CAPTION>
Completed Years Vacation Days Vacation Days
Of Service Accrued Per Bid Accrued Per Year
Period
--------------- --------------- ----------------
<S> <C> <C> <C>
1 - 4 1.08 14
5 + 1.62 21
</TABLE>
9.2. VACATION PAY
Vacation pay will be computed at the Crewmember's rate of pay at the
time vacation is taken or paid in lieu of vacation. A Crewmember will
not receive less than his MBPG in a Bid Period in which all or part of
his vacation occurs provided he is available for duty for the remainder
of his scheduled duty Days. Vacation pay is three point five (3.5)
hours of Flight Pay for each Day of vacation. Pay in lieu of vacation
may be requested at any time.
9.3. DUTY
9.3.1. NO DUTY
A Crewmember will not be required to perform any duty while on
vacation.
9.3.2. DUTY FREE DAYS
A scheduled vacation Day that falls on a scheduled duty free
Day will not be deducted from a Crewmember's vacation bank. A
Crewmember who has awarded vacation covering an entire Bid
Line will not be awarded that Bid Line, but his bid choice
will be used to determine the number of vacation Days to be
deducted from his vacation bank.
9.4. ANNUAL VACATION BID
9.4.1. PROCEDURE
On or before October 1st of each year, the Company will mail
to each Crewmember a bid package containing vacation periods
available for the next calendar year and a bid form. The
Company must receive the completed bid form no later than
October 31st. Vacation will be awarded in order of seniority
at the Base in Type and Crew Class. A Union representative may
be present during the awarding of vacation. The Company will
mail the results to all Crewmembers no later than November
20th.
9.4.2. PROBATIONARY CREWMEMBER
At the time of the annual vacation bid, a Crewmember with less
than one (1) year of Active Service may bid a scheduled
vacation in the following calendar year provided such vacation
occurs after completion of one (1) year of Active Service.
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9.4.3. FAILURE TO BID
A Crewmember who fails to bid or fails to bid sufficient
choices will not be awarded a scheduled vacation.
9.5. VACATION OPTIONS
A Crewmember may exercise the following options with his accrued
vacation (The desired option(s) must be indicated on the bid form):
Take the vacation in the calendar year, be paid in lieu of vacation,
bank the vacation or a combination of the above.
9.6. VACATION SPLITS
Scheduled vacation may be split into periods of not less than seven
(7) Days. Split vacation bids must be designated primary, secondary
and tertiary on the bid form. A Crewmember's primary vacation block
will be awarded in seniority order. The secondary vacation block will
be awarded after all other Crewmembers have been awarded their
primary vacation bid. Secondary vacation blocks will be awarded in
seniority order among those Crewmembers who have bid a secondary
block. Tertiary vacation blocks, if any, will be awarded in the same
manner.
9.7. UNSCHEDULED VACATION
If a Crewmember has vacation Days in his bank, he may, depending on
the operational needs of the Company, be awarded previously
unscheduled vacation.
9.8. VACATION RESCHEDULING
9.8.1. RESCHEDULE
The Company will not change any vacation date after the
sixtieth (60th) Day prior to the beginning of the vacation
except by mutual agreement between the Crewmember and the
Company.
9.8.2. RELINQUISH
A Crewmember may elect to relinquish his awarded vacation by
giving the Company written notice at least sixty (60) Days
prior to the beginning of the vacation.
9.8.3. CHANGE OF CREWMEMBER STATUS
Irrespective of subsection 9.8.1., above, a Crewmember who
changes Base, Type or Crew Class after vacation periods have
been awarded will be granted his choice of remaining
available vacation periods in his new Base, Type and Crew
Class. The Company will make every effort to permit the
Crewmember to retain his originally awarded vacation period.
If Company requirements preclude retention of this period,
the Crewmember will be notified, within twenty-one (21) Days
after changing Base, Type or Crew Class, that his vacation
must be changed and will be provided a list of vacation
periods available.
9.8.4. VACATION SLIDE
A Crewmember's vacation period will slide one (1) Day if,
because of a reroute or reschedule, the Crewmember will have
less than a twelve (12) hour rest period after release at
his Base immediately prior to the beginning of his vacation.
The Company will return a Crewmember to his Base or a
mutually agreed upon location prior to the beginning of his
vacation.
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9.9. VACATION BANK
9.9.1. MAXIMUM BANK
A Crewmember with five (5) years or less of Active Service
may bank up to twenty-eight (28) vacation Days. A Crewmember
with more than five (5) years of Active Service may bank up
to forty-two (42) vacation Days.
9.9.2. PAY OUT
9.9.2.1. EXCESS BANK
Vacation Days accrued in excess of the maximum
allowable bank as of December 31 of each year
will be paid on the second paycheck of January in
the following year.
9.9.2.2. CESSATION OF EMPLOYMENT
If a Crewmember resigns, retires, is terminated
or dies, the Crewmember or his estate will be
paid for all accrued vacation provided the
Crewmember has completed one (1) year of Active
Service. In case of resignation, the Crewmember
must give the Company at least fourteen (14) Days
written notice of resignation in order to receive
accrued vacation.
9.9.2.3. SUPPLEMENT TO SICK LEAVE OR DISABILITY BENEFITS
A Crewmember may use accrued vacation to
supplement his sick leave or short-term
disability benefits. The combination of sick
leave, disability benefits and vacation will not
exceed a Crewmember's MBPG.
9.10. GENERAL
9.10.1. VACATION DAY
Vacation will begin at 0000Z and end at 2359Z at a
Crewmember's Base.
9.10.2. STATEMENTS
A Crewmember's pay statement will show his accrued vacation.
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SECTION 10 - HEALTH AND WELFARE
10.1. LIFE INSURANCE
The Company will provide life insurance for a Crewmember who has
completed ninety (90) Days of Active Service. Coverage will be equal
to one (1) year at the Crewmember's MBPG, rounded to the nearest one
thousand dollars ($1,000). Effective July 1, 2000, a Crewmember who
has completed five (5) years of Active Service will be provided
coverage equal to two (2) years at the Crewmember's MBPG, rounded to
the nearest one thousand dollars ($1,000). A Crewmember will continue
to be covered by life insurance while operating a Company flight
within a hostile area. Life insurance will be continued during the
first thirty (30) Days of a leave of absence.
10.1.1. ADDITIONAL LIFE INSURANCE
The Company may offer additional life insurance that each
Crewmember would be eligible to purchase.
10.2. ACCIDENTAL DEATH AND DISMEMBERMENT INSURANCE
The Company will provide accidental death and dismemberment insurance
for a Crewmember who has completed ninety (90) Days of Active
Service. Coverage will be equal to one (1) year at the Crewmember's
MBPG, rounded to the nearest one thousand dollars ($1,000).
Accidental death and dismemberment insurance will be continued during
the first thirty (30) Days of a leave of absence.
10.3. HEALTH AND DENTAL INSURANCE
The Company will provide health and dental insurance for a Crewmember
desiring coverage who has completed ninety (90) Days of Active
Service. Overall coverage levels will not be less than the overall
coverage levels in effect on the effective date of this Agreement.
The Company may change insurance carriers or offer alternative plans,
such as HMOs or PPOs.
10.3.1. COBRA
When a Crewmember leaves the service of the Company,
including leaves of absence, he may be entitled to a
continuation of all or part of his health and dental
insurance coverage under COBRA. If a Crewmember is eligible
for coverage under COBRA, all information regarding
coverage, premiums, deadlines and forms will be forwarded to
him at the address the Company has on file.
10.3.2. LEAVES OF ABSENCE
A Crewmember on a leave of absence must pay the employee
portion of premiums during the first thirty (30) Days of the
leave if he desires to remain covered. For leaves extending
beyond thirty (30) Days, the Crewmember must, if he is
eligible, elect COBRA to continue coverage, except as
required by applicable law.
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10.3.3. PREMIUMS FOR HEALTH AND DENTAL INSURANCE
The premium costs of health and dental insurance coverage
will be shared between the Company and the Crewmember.
Premium costs for Crewmembers will be no less favorable than
those provided to other groups of Company employees.
Notwithstanding the above, Crewmembers will have premium
costs no greater than set forth in the table below:
<TABLE>
<CAPTION>
Years of Active Service Single Coverage Family Coverage
----------------------- --------------- ---------------
<S> <C> <C> <C>
1 through 3 $60.00 $150.00
4 through 6 $40.00 $100.00
greater than 6 no cost no cost
</TABLE>
10.3.4. CONTINUATION OF HEALTH AND DENTAL INSURANCE AFTER RETIREMENT
The Company will provide for continuation of all or a
portion of a Crewmember's health and dental insurance
coverage after retirement. Such coverage will be offset by
COBRA. The cost of such coverage will be borne by the
Crewmember and will not exceed the Company's cost for such
insurance. Such coverage will be available to retired
Crewmembers who have exceeded the FAA mandatory retirement
age for Pilots and will continue until the minimum age to
qualify for Medicare health insurance. If a Crewmember does
not elect this coverage or elects to discontinue this
coverage, he will no longer be eligible for such coverage.
10.4. SHORT-TERM DISABILITY INSURANCE
The Company will provide short-term disability insurance for a
Crewmember who has completed ninety (90) Days of Active Service.
Short-term disability benefits will be not less than sixty (60)
percent of a Crewmember's MBPG. The maximum benefit per week will be
not more than six hundred dollars ($600). Short-term disability
benefits will begin, pursuant to the terms of the policy, after the
required waiting period and after the Crewmember has been placed on a
Medical Leave of Absence. Short-term disability benefits will
continue for up to six (6) Months.
10.5. LONG-TERM DISABILITY INSURANCE
The Company will offer long-term disability insurance that each
Crewmember would be eligible to purchase in accordance with the terms
of the policy. The Union and the Company will periodically review the
advisability of changing coverage and insurance carriers.
10.6. ILLNESS OR INJURY WHILE IN THE SERVICE OF THE COMPANY
10.6.1. MEDICAL CARE AWAY FROM BASE
If a Crewmember suffers a work-related illness or injury
away from his Base on Company business and the injury
requires medical care away from his Base, the Company will
pay all hospitalization and medical expenses that are not
covered by applicable insurance.
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10.6.2. TRANSPORTATION
A Crewmember who becomes ill or injured on Company business
and who as a result is unable to complete his assignment
will be provided with necessary transportation to his Base
or residence as soon as prudent and possible. Such
transportation will be provided at Company expense if not
otherwise covered by applicable insurance.
10.6.3. WORKER'S COMPENSATION FILING PROCEDURE
A Crewmember who suffers a work-related illness or injury
covered by Worker's Compensation must report such illness to
the Company as soon as possible and complete an
injury/illness report. A claim for Worker's Compensation
must be filed in the state where the Crewmember is Based.
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SECTION 11 - RETIREMENT
11.1. TAX DEFERRED SAVINGS PLAN
Not later than six (6) months after the date of signing of this
Agreement, the Company will establish the Kitty Hawk International
Crewmember's 401(k) Tax Deferred Savings Plan (the "Plan"). In
accordance with the terms of the Plan, the Plan will be extended to
all eligible Crewmembers. Crewmember participation in the Teamsters
National 401(k) Plan will cease when the Kitty Hawk International
Crewmember's 401(k) Plan is made available. All funds in the
Teamsters National 401(k) Plan will be rolled over into the Plan
without cost to the Crewmember. The Plan will allow a Crewmember to
make self-directed investments. Transition from the Teamsters
National 401(k) Plan to the Plan will occur with no interruption in
payroll deductions.
11.2. COMPANY CONTRIBUTIONS
Pursuant to the Plan, the Company will match twenty-five percent
(25%) of the first four percent (4%) of a Crewmember's contribution
to the Plan, to a maximum of five hundred dollars ($500). For the
year 2001 and subsequent years the Company will match twenty-five
percent (25%) of a Crewmember's contribution to the Plan, up to the
maximum permitted by law.
11.3. VESTING SCHEDULE
Company contributions to a Crewmember's 401(k) account will be vested
in accordance with the following schedule:
<TABLE>
<CAPTION>
---------------------------------------------------------------------------
Year of Active Service Percent of total Company
contribution that is vested
---------------------------------------------------------------------------
<S> <C> <C>
1st Zero percent (0%)
---------------------------------------------------------------------------
2nd Twenty percent (20%)
---------------------------------------------------------------------------
3rd Forty percent (40%)
---------------------------------------------------------------------------
4th Sixty percent (60%)
---------------------------------------------------------------------------
5th Eighty percent (80%)
---------------------------------------------------------------------------
</TABLE>
All Company contributions will be fully vested after five (5) years
of Active Service.
11.4. PAYROLL DEDUCTIONS
The Company will make payroll deductions for each Crewmember who
participates in the Plan and deposit the funds into the account
designated by the Plan Administrator in accordance with applicable
laws. Prior to making the Plan available to Crewmembers, such funds
will be deposited in the account designated by the Teamsters National
401(k) Plan Administrator. Subsequent to making the Plan available to
Crewmembers, such funds will be deposited in the account designated
by the Plan Administrator.
11.5. CREWMEMBER FUNDS IN PRE-EXISTING COMPANY 401(k) PLAN
Those Crewmembers who have funds in the pre-existing Company 401(k)
plan that were deposited into the Company plan prior to the Teamsters
National 401(k) Plan being offered to Crewmembers will continue to
have those funds held in the Company 401(k) plan, until or unless
such Crewmembers elect to transfer the pre-existing Company 401(k)
plan into the new Plan, in accordance with applicable laws.
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<PAGE> 33
SECTION 12 - UNIFORMS
12.1. INITIAL UNIFORMS
A Crewmember will wear the standard uniform as prescribed by the
Company while on duty. The cost of the original uniform will be borne
by the Crewmember. A payroll deduction plan will be made available.
12.2. MAINTENANCE ALLOWANCE
The annual uniform maintenance allowance for a Crewmember will be one
hundred thirty dollars ($130.00), paid during the first Month
following the anniversary of his Date of Hire and every year
thereafter, provided the Crewmember is employed at the time the
allowance is paid.
12.3. REPLACEMENT OF DAMAGED ITEMS
The Company will reimburse a Crewmember for any items of the uniform
that are damaged in the performance of duty. A Crewmember requesting
reimbursement for replacement of an item damaged in the performance
of duty must submit an expense reimbursement form to the Company with
the original receipt along with the damaged uniform item.
12.4. COMPANY INSIGNIA
The Company will provide each Crewmember, free of charge, any Company
insignia, epaulets or emblem worn as part of the uniform. Such items
will remain the property of the Company. Each Crewmember will be
responsible for replacement of these items if they are lost.
12.5. UNION INSIGNIA
A Union lapel pin may be worn on the uniform.
12.6. CHANGES IN UNIFORM
The Company will consider the recommendations of the Crewmembers
regarding any changes to the uniform.
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SECTION 13 - PHYSICAL EXAMINATIONS
13.1. COMPANY STANDARDS
The physical standards required of a Crewmember are the standards
established by the Federal Aviation Administration (FAA).
13.2. CONFIDENTIALITY
Information obtained from an FAA-required physical examination will
be kept confidential between the doctor(s), the Crewmember and
Company personnel concerned with the Crewmember's physical condition,
unless otherwise required by law or regulation.
13.3. FAA PHYSICAL EXAMINATIONS
13.3.1. CERTIFICATES TO TRAINING DEPARTMENT
A Crewmember will provide the Training Department with a
copy of his new current medical certificate by the twenty
fifth (25th) Day of the Month in which the old medical
certificate will expire. The Company may remove a Crewmember
from service without pay if he fails to comply with this
requirement. A Crewmember who is not able to exercise the
privileges of his medical certificate will notify the
Company of such inability in writing within twenty four (24)
hours.
13.3.2. SCHEDULING OF FAA PHYSICAL
During the Month in which a Crewmember's physical
examination is due, the Company will not prevent a
Crewmember from attending the examination. A Crewmember will
schedule his physical examination so as not to interfere
with any Company-required duty.
13.3.3. INABILITY TO MAINTAIN A FIRST CLASS MEDICAL CERTIFICATE
A Pilot who is unable to maintain a First Class Medical
Certificate but who is able to maintain a Second Class
Medical Certificate may elect to remain as, or revert to, a
First Officer. If the Pilot regains a First Class Medical
Certificate, he may bid for Captain.
13.4. REIMBURSEMENT FOR A PHYSICAL EXAMINATION
If a Crewmember is eligible for, and carries, Company health
insurance, the Company will pay the cost of one (1) physical
examination annually. The examination will be paid in full up to one
hundred dollars ($100) without regard to the annual deductible. If
the cost of the examination exceeds one hundred dollars ($100), the
additional amount will be covered at eighty percent (80%), provided
that the annual deductible has been satisfied.
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13.5. FAA DRUG AND ALCOHOL TESTING PROGRAMS
13.5.1. PROGRAM ADMINISTRATION AND DESCRIPTION
The Company and the Crewmembers will adhere to the current
FAA Drug and Alcohol Testing Programs. The Company will
provide each Crewmember and the Union with all FAA-required
material and information regarding the programs. The Company
will make every effort to schedule FAA-required drug testing
on a Crewmember's Duty Day. A Crewmember will not be called
in to take an FAA-required random alcohol test on a duty
free Day. The Company will notify Crewmembers, in writing,
of any changes, modifications, or additions to the programs.
13.5.2. REIMBURSEMENT OF EXPENSES
The Company will reimburse a Crewmember for the cost of
transportation, including mileage, to and from all
FAA-required drug and alcohol testing.
13.5.3. DRUG TESTING ON A SCHEDULED DUTY FREE DAY
A Crewmember who is called in for an FAA-required random
drug test on a scheduled duty free Day will be paid two (2)
hours Flight Pay in addition to all other compensation.
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SECTION 14 - LEAVES OF ABSENCE
14.1. PERSONAL LEAVE
14.1.1. REQUESTS
When the requirements of the Company will permit, at the
sole discretion of the Company, and upon written request
submitted by a Crewmember to the Company as far in advance
as possible, a Crewmember may be granted a leave of absence
without pay. Such approval will not be effective unless
stated in writing, specifying the beginning and ending dates
for the leave and signed by the Director of Operations, or
his designee.
14.1.2. SENIORITY AND LONGEVITY ACCRUAL
When a personal leave is granted, a Crewmember will continue
to accrue seniority during the first sixty (60) Days of the
leave. A Crewmember will not accrue sick leave, vacation or
longevity for pay purposes, starting with the first day of
the Bid Period following the Bid Period in which his leave
commenced. Accrual will recommence on the first Day of the
Bid Period in which a Crewmember returns from leave.
14.1.3. EXTENSIONS
Personal leave may be extended for additional periods when
approved in writing by the Company. Such approval will state
the ending date of the leave and be signed by the Director
of Operations, or his designee.
14.2. MILITARY LEAVE
A Crewmember who enters involuntary, extended military service will
be granted military leave in accordance with applicable federal laws
and regulations. Military leave will be without pay. Return to duty
will be subject to a requalifying period not to exceed thirty (30)
Days. Weekend drills and annual two (2) week requirements are dealt
with in Section 20.
14.3. UNION LEAVE
With thirty (30) Days written notice, up to four (4) Crewmembers
appointed as Union officials, representatives, or delegates will be
granted leaves of absence without pay. A Crewmember on Union leave
will accrue seniority and longevity for pay purposes but will not
accrue longevity for any other purpose.
14.4. MEDICAL LEAVE
A Crewmember whose sick leave bank has been exhausted, or who has
been on sick leave for seven (7) consecutive Days and who is unable
to return to active status will be placed on medical leave of absence
without pay. A medical leave of absence will not exceed three (3)
years. A Crewmember on medical leave of absence will accrue seniority
but will not accrue longevity for any purpose.
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14.5. FUNERAL LEAVE
14.5.1. DURATION
In the case of death in the immediate family, a Crewmember
is entitled to three (3) Days leave with pay for the purpose
of attending the funeral. The Crewmember will inform Crew
Scheduling which three (3) Day period is to be taken.
14.5.2. IMMEDIATE FAMILY
Immediate family will be limited to the Crewmember's spouse,
children, stepchildren, father, father-in-law, stepfather,
mother, mother-in-law, stepmother, sister, stepsister,
brother, and stepbrother. The Crewmember may be required to
provide verification of attendance at the funeral.
14.5.3. VACATION
A Crewmember who experiences the a death of an immediate
family member during a vacation must notify his supervisor
immediately upon receiving notice of the death and will have
up to three (3) Days of remaining vacation rescheduled at a
later date provided the Crewmember attends the funeral.
14.5.4. SCHEDULED DUTY FREE DAYS
Funeral leave will not apply when a Crewmember is on a
scheduled duty free Day.
14.6. FAMILY AND MEDICAL LEAVE ACT (FMLA)
14.6.1. FMLA
A Crewmember is permitted a leave of absence to the extent
required by, and in accordance with, the terms of the FMLA.
14.6.2. SENIORITY AND LONGEVITY ACCRUAL
During FMLA leave, a Crewmember will accrue seniority and
longevity for pay purposes but will not accrue longevity for
any other purpose.
14.7. MANAGEMENT CREWMEMBER LEAVE
14.7.1. SENIORITY AND LONGEVITY ACCRUAL
A Management Crewmember will be included on the Seniority
List(s), designated by title. A Management Crewmember will
accrue seniority and longevity, but will not accrue sick
leave or vacation in accordance with this Agreement.
14.7.2. EXCLUSION FROM THE AGREEMENT
A Management Crewmember is not subject to this Agreement.
14.7.3. MAXIMUM NUMBER
Management leave is limited to a maximum of eleven (11)
Crewmembers. The Company will provide the Union with a list
of Management Crewmembers and notify the Union in writing of
any changes.
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14.7.4. 401(k) PLAN
Management Crewmembers may participate in the 401(k) plan
set forth in Section 11.
14.7.5. DUES EXEMPTION
A Management Crewmember will not be required to pay a Union
initiation fee, Union dues or service fees.
14.7.6. FLYING RESTRICTION
A Management Crewmember will be limited to twenty-eight (28)
hours of out-of-seniority flying in any Bid Period when a
furlough is in effect.
14.8. GENERAL
14.8.1. OTHER EMPLOYMENT
A Crewmember on a leave of absence will not, without prior
written permission of the Company, engage in any employment.
14.8.2. RETURN FROM LEAVE
A Crewmember returning from leave will return to a vacancy,
pursuant to Section 16, or to his former position, provided
that it still exists and his seniority will allow him to
hold the position. If the former position does not exist or
he can no longer hold the position, the Crewmember may bump
into any position for which he is qualified. If no such
position exists, the Crewmember may exercise his seniority
to assume another position.
14.8.3. PAY DURING REQUALIFICATION
Should qualification or requalification be necessary, a
Crewmember returning from leave will be paid new-hire pay
during such qualification or requalification for not more
than thirty (30) Days. If the qualification or
requalification period exceeds thirty (30) Days, the
Crewmember will receive his applicable MBPG for that portion
of the requalification that exceeds thirty (30) Days. If
qualification or requalification is necessary, the Company
will have up to thirty (30) Days following the Crewmember's
notification that he is available to resume duty to return
the Crewmember to pay status in accordance with this
subsection.
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SECTION 15 - SENIORITY
15.1. SENIORITY GOVERNS
Except as otherwise provided in this Agreement, seniority will govern
awards and assignments.
15.2. SENIORITY LISTS
15.2.1. SEPARATE LISTS
Two (2) separate Seniority Lists will be maintained. The
Pilot's Seniority List will be based on a Crewmember's Date
of Hire with the Company as a Crewmember. The Flight
Engineer's Seniority List will be based on a Crewmember's
Date of Hire with the Company as a Crewmember. When two (2)
or more Crewmembers have the same Date of Hire in the same
Category, they will be placed on the applicable Seniority
List according to their age, i.e., the oldest Crewmember
will receive the more senior position.
15.2.2. LIST CONTENTS
The Pilots' Seniority List will include all Captains and
First Officers. The Flight Engineers' Seniority List will
include all Second Officers and Professional Flight
Engineers. Crewmembers hired by the Company after the date
of ratification of this Agreement will be placed on either
the Pilots' Seniority List or the Flight Engineers'
Seniority List by Date of Hire.
15.3. SENIORITY ACCRUAL
A Crewmember will accrue seniority continuously during his
employment, except as otherwise provided in this Agreement.
15.4. SENIORITY LIST CONTENT AND PUBLISHING
15.4.1. CONTENT
The Seniority Lists will contain the date of the List, the
category identification of the List, i.e., Pilot or Flight
Engineer, seniority numbers, Crewmembers' names, Dates of
Hire, birth dates, aircraft assignments, Crew Class, Check
Airman or management status, Leave Status, assigned Base and
designation as Prior Rights Flight Engineers.
15.4.2. POSTING
The Company will post the Seniority Lists at all Base(s) and
hubs. On or before January 15 and July 15 of each year, the
Company will mail an updated copy of the Seniority Lists to
each Crewmember's home address and to the Union. The person
issuing the Seniority Lists will date and sign the Lists.
15.5. PROTESTS
A Crewmember will be permitted ninety (90) days after posting of a
Seniority List in which to protest, in writing to the Company, any
omission or incorrect posting affecting his seniority. If a
Crewmember fails to file such protest, he is bound by the list and
has no further recourse regarding that or any subsequent list
containing that omission or incorrect posting.
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15.6. LOSS OF SENIORITY
A Crewmember having established a seniority date hereunder will not
lose that date except by resignation or retirement, termination,
furlough of more than six (6) continuous years or failure to return
to duty upon expiration of a leave of absence.
15.7. EFFECT OF BYPASS ON SENIORITY
When a junior Crewmember is promoted over a senior Crewmember by
reason of the failure of the latter to qualify in his turn, the more
senior Crewmember will retain his position on the applicable
Seniority List.
15.8. LONGEVITY
Longevity for pay and benefits will be based on a Crewmember's Date
of Hire with the Company in any capacity, adjusted for leaves of
absence and furloughs. Longevity will be utilized to determine
entitlement to benefits and to establish rates of pay.
15.9. PROBATION
A Crewmember will be on probation until he has accumulated twelve
(12) Months of Active Service from his Date of Hire as a Crewmember
or the successful completion of his next proficiency check, whichever
is later.
15.10. FLIGHT ENGINEER TO PILOT BIDDING
A Crewmember may exercise his seniority to move from the Flight
Engineers' Seniority List to the Pilots' Seniority List by bidding
for a Pilot vacancy.
15.10.1. MINIMUM REQUIREMENTS
A Crewmember submitting such a bid must meet the First
Officer minimum requirements set forth in Section 19.
15.10.2. TRAINING AVAILABILITY
A Crewmember who is awarded a bid pursuant to this
subsection must make himself available at a time convenient
to the Company for Training for the Pilot position.
15.10.3. FAILURE TO QUALIFY
A Crewmember awarded a bid pursuant to this subsection who
fails to qualify as a Pilot may return to his previous
position on the Flight Engineers' Seniority List provided
the Crewmember can qualify for such position.
15.10.4. REMOVAL FROM SENIORITY LIST
Upon successful qualification as a Pilot, including
completion of all required Training, a Crewmember awarded a
bid pursuant to this subsection will be removed from the
Flight Engineers' Seniority List.
15.11. PILOT TO FLIGHT ENGINEER BIDDING
A Crewmember may exercise his seniority to move from the Pilots'
Seniority List to the Flight Engineers' Seniority List one (1) time
only by bidding for a Flight Engineer vacancy.
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<PAGE> 41
15.11.1. BID SUBMISSION DEADLINE
Such a bid must be on file not less than one hundred eighty
(180) Days before the Crewmember reaches the FAA mandatory
Pilot retirement age.
15.11.2. MINIMUM REQUIREMENTS
A Crewmember submitting such a bid must meet the Flight
Engineer minimum requirements set forth in Section 19.
15.11.3. BID TO PROFESSIONAL FLIGHT ENGINEER
A Crewmember who, at the time of bid award, can qualify as a
Professional Flight Engineer will be placed on the Flight
Engineers' Seniority List, in accordance with his seniority,
upon successful qualification as a Flight Engineer.
15.11.4. BID TO SECOND OFFICER
A Crewmember who, at the time of bid award, cannot qualify
as a Professional Flight Engineer will be placed on the
Flight Engineers' Seniority List, in seniority order, below
the lowest seniority Prior Rights Flight Engineer, upon
successful qualification as a Flight Engineer.
15.11.5. HOLDING A BID ON FILE
If a bid filed pursuant to subsection 15.11.1. is not
awarded before the Crewmember reaches the FAA mandatory
Pilot retirement age, such bid will remain on file and
eligible for award until twenty-four (24) months after the
Crewmember reaches the FAA mandatory Pilot retirement age.
However, in such a case the Crewmember will be placed on the
Flight Engineer's Seniority List, in seniority order, below
the lowest seniority Prior Rights Flight Engineer.
15.11.6. TRAINING AVAILABILITY
A Crewmember who is awarded a bid pursuant to this
subsection must make himself available at a time convenient
to the Company for Training for the Flight Engineer
position. A Crewmember who declines a Flight Engineer class
date for reasons within his control forfeits rights to
subsections 15.11.3. and 15.11.5. If the Company elects to
delay Training, the affected Crewmember will not forfeit
rights to any part of this Section.
15.11.7. REMOVAL FROM SENIORITY LIST
Upon successful qualification as a Flight Engineer,
including completion of all required Training, a Crewmember
awarded a bid pursuant to this subsection will be removed
from the Pilots' Seniority List.
15.11.8. FAILURE TO QUALIFY
A Crewmember awarded a bid pursuant to this subsection who
fails to qualify as a Flight Engineer may return to his
previous position on the Pilots' Seniority List, provided
the Crewmember can qualify for such position.
15.11.9. DISPLACEMENT TO FLIGHT ENGINEER
The one-time bid limitation of this subsection will not
apply to a Crewmember who is Displaced from the Pilots'
Seniority List to the Flight Engineers' Seniority List.
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SECTION 16 - FILLING OF VACANCIES
16.1. VACANCY DEFINITION
A vacancy means additional or open positions designated by the
Company in any Base, Type and Crew Class.
16.2. STANDING BID
16.2.1. STANDING BID DEFINITION
Each Crewmember must submit a signed and dated Standing Bid
on a form provided by the Company to the Director of
Operations, or his designee, by certified or registered
mail, return receipt requested, fax or hand delivery.
Standing Bids are effective upon receipt but will not be
considered for a vacancy notice that has closed. The
Standing Bid will indicate the Crewmember's preferences for
all Base, Type and Crew Class listings. A Standing Bid file
will be maintained by the Director of Operations, or his
designee. A Crewmember may inspect his bid during normal
office hours. A Crewmember who has no Standing Bid on file
will be assumed to have bid his present position.
16.2.2. STANDING BID UPDATES
A Crewmember's Standing Bid may be updated at any time. An
updated Standing Bid must be submitted on a form provided by
the Company, signed and dated by the Crewmember, to the
Director of Operations, or his designee, by certified or
registered mail, return receipt requested, fax or hand
delivery. Updated Standing Bids are effective upon receipt,
but will not be considered for a vacancy notice that has
closed.
16.3. VACANCY FILLING
Vacancies will be filled in accordance with the following procedure:
16.3.1. VACANCY NOTICE
The Company will determine the number of vacancies and post
a notice announcing all known vacancies. The notice will
state the Effective Date for each vacancy and the total
number of positions, by Base, Type and Crew Class, required
system wide. A copy of such notice will be mailed to each
Crewmember, including each furloughed Crewmember.
16.3.2. VACANCY CLOSING AND BID SUBMISSION
The notice will include a deadline by which updated Standing
Bids must be received by the Director of Operations, or his
designee, which will not be less than fourteen (14) Days
after the date such notice is mailed to Crewmembers. Each
notice will be numbered consecutively during a calendar
year. By mutual agreement, the Union and the Company may
reduce the deadline period.
16.3.3. BID AWARD
Bids will be awarded in seniority order to Crewmembers who
will be, or reasonably can be expected to be, available on
the date Training for the award commences. A Crewmember
appointed by the Union will be present at the time of bid
awards, if the Union so requests. A Crewmember awarded a bid
must meet the qualifications set forth in Section 19.
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16.3.4. ADDITIONAL VACANCIES
Additional vacancies created by the bid awards will be
filled concurrent with the bid awards in seniority order,
based on a Crewmember's Standing Bid. No additional vacancy
notice will be required.
16.3.5. UNFILLED VACANCIES
Vacancies that remain unfilled after bids have been awarded
may be assigned in reverse Category seniority order or
filled by new-hire Crewmembers.
16.3.6. PUBLISHING OF BID RESULTS
Results of bid awards and assignments will be mailed to each
Crewmember within fourteen (14) Days after the specified
closing date and will refer to the notice number that
announced such vacancy(s). Results will include the
Effective Date, Base, Type, Crew Class, name and seniority
number of each successful bidder or assigned Crewmember.
16.4. EQUIPMENT LOCK
A Crewmember is not eligible to bid on any type of aircraft other
than the type he is flying unless , on the Effective Date of the
vacancy, he has completed eighteen (18) Months of Active Service from
completion of his initial line check in his Type and Crew Class. This
provision does not apply in the case of any Crewmember who has
received notice of Curtailment in his Base, Type and Crew Class or
who has been Displaced. When posting a vacancy notice, the Company
may waive the equipment lock, provided the waiver is applied equally
to all Crewmembers within a Crew Class. The waiver must be contained
within the vacancy notice.
16.4.1. NEW EQUIPMENT TYPE
If the Company acquires a Type not previously in its fleet,
all non-probationary Crewmembers who bid for that Type will
have any existing equipment lock waived. This waiver applies
for twelve (12) Months from the date such Type is placed in
service.
16.5. BYPASS
If a Pilot, or a Flight Engineer who has bid for the Category of
Pilot, has attained the age of 57 at the time of his bid award or
Displacement, and Training is required, the Company may elect not to
train the Crewmember and pay him as follows:
16.5.1. UPGRADE TO CAPTAIN
The Crewmember will be paid as a Captain until reaching the
FAA mandated retirement age for Pilots.
16.5.2. TRANSITION
The Crewmember will be paid an override of ten dollars
($10.00) per hour for each hour credited until reaching the
FAA mandated retirement age for Pilots.
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SECTION 17 - BASES
17.1. UNION CONSULTATION
The Company will confer with the Union before opening any new Base.
17.2. INTERNATIONAL BASES
If the Company desires to establish any Base outside the contiguous
United States and the District of Columbia, the Union and the Company
will meet and agree upon the changes necessary in this Agreement
prior to establishing such a Base.
17.3. DOMESTIC BASES
17.3.1. MINIMUM STAFFING LEVEL
If the Company desires to establish any Base inside the
contiguous United States and the District of Columbia, the
Base will be staffed initially with at least four (4) crews
by Type. The average annualized staffing at the base will be
maintained at a minimum of four (4) crews.
17.3.2. STAFFING LEVEL CHANGES
Subject to subsection 17.3.1., the Company may increase or
decrease the staffing level at any domestic Base as follows:
17.3.2.1. INCREASED STAFFING
If the Company opens a new base or desires to
increase staffing within a Type and Crew Class at
an existing Base, it will award such positions in
seniority order in accordance with standing bids
on file from among Crewmembers in the appropriate
Type and Crew Class. If no Crewmember in the Type
and Crew Class has a standing bid on file for
such Base, the Company may junior assign to such
position from among Crewmembers in the Type and
Crew Class or may fill the position in accordance
with Section 16.
17.3.2.2. DECREASED STAFFING
If the Company desires to decrease staffing
within a Type and Crew Class at a Base, it will
displace the most junior Crewmember in that Type
and Crew Class at the Base. In accordance with
his standing bid on file, the displaced
Crewmember will displace a more junior Crewmember
in his Type and Crew Class at any other Base. If
the displaced Crewmember is unable to fill a
position in his Type and Crew Class pursuant to
subsections 17.3.2.1. or 17.3.2.2., he will be
subject to the provisions of subsection 18.2..
17.3.2.3. NO MOVING EXPENSES
A Crewmember who changes Bases voluntarily or
involuntarily in accordance with the provisions
of subsection 17.3. will not be eligible for
moving expenses.
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17.3.3. THIRTY-FIVE (35) MILE RULE
17.3.3.1. PER DIEM IN BASE
A Crewmember whose principal residence is more
than thirty-five (35) miles from his Base will be
eligible for Per Diem for all hours beginning
when he reports for a flight assignment at his
Base or is required to be on reserve, other than
R-3, at his Base and ending when he is released
from all duty at his Base for a Day off meeting
the requirements of subsection 20.2.2.3.
17.3.3.2. LODGING IN BASE
A Crewmember whose principal residence is more
than thirty-five (35) miles from his Base will be
eligible for lodging in his base beginning when
he reports for a flight assignment at his Base or
is required to be on reserve, other than R-3, at
his Base and ending when he is released from all
duty at his Base for a Day off meeting the
requirements of subsection 20.2.2.3. A Crewmember
who is eligible for lodging under this subsection
who reports for an assignment during which he
will be provided with lodging in accordance with
subsection 6.2. will check out from the in-Base
lodging during such an assignment.
17.4. TEMPORARY BASES
The Company may establish temporary Bases within the contiguous
United States and the District of Columbia for up to three (3)
consecutive Bid Periods, when establishment of a permanent Base is
not practical. Temporary Bases may be bid only by Crewmembers in the
Base, Type and Crew Class designated by the Company. If there are
insufficient bidders, the Company may assign Crewmembers to a
temporary Base, in inverse seniority order. Lodging will be provided
while the Crewmember is in his temporary Base. Per Diem will be
provided continuously from the time the Crewmember leaves his
permanent Base or Residence Airport for the temporary Base assignment
until he returns to his permanent Base or Residence Airport after his
temporary assignment is completed. Transportation to and from the
temporary Base will be provided at the beginning and the end of the
temporary assignment. Release for all scheduled Days free of duty
will occur at the Crewmember's temporary Base.
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SECTION 18 - CURTAILMENT, DISPLACEMENT, FURLOUGH AND RECALL
18.1. CURTAILMENT
When a reduction in the required number of Crewmembers becomes
necessary in any Base, Type and Crew Class, a Curtailment will occur.
A notice of Curtailment will be published prior to the effective date
of the Curtailment.
18.1.1. CURTAILMENT PROCEDURE
If a Curtailment is not satisfied by the awarding of a
vacancy, retirement, resignation, termination, death or
leave of absence, a Displacement will occur.
18.2. DISPLACEMENT
When, because of a Curtailment, a Crewmember can no longer hold his
position, a Displacement will occur.
18.2.1. DISPLACEMENT PROCEDURE
Displacement will occur in inverse order of seniority. A
displaced Crewmember may exercise his seniority to assume
any position in his Type and Crew Class or, if no such
position is available, to assume any position he can hold.
18.3. FURLOUGH
If a Displaced Crewmember is unable to hold any position, he may be
furloughed.
18.3.1. VOLUNTARY FURLOUGH
Prior to a furlough, the Company may grant voluntary
furloughs.
18.3.2. NOTICE OF FURLOUGH
When a Crewmember is to be furloughed, he will be given at
least fourteen (14) Days written notice, or pay in lieu
thereof, except when the furlough is caused by a strike, Act
of God, involuntary grounding of Company aircraft or other
circumstances beyond the Company's control. In such cases,
the Company will give as much notice as possible.
Announcements of furlough will be posted at all Bases and
hubs. Notice to an affected Crewmember will be registered or
certified mail, return receipt requested, or hand delivered
to, and signed for by, the Crewmember. An affected
Crewmember on a Trip Sequence that does not transit any
Bases or hubs will be notified of his furlough directly by
the Company not later than twelve (12) Days prior to the
effective date of the furlough.
18.3.3. RETENTION OF SENIORITY
A Crewmember will accrue seniority but not longevity while
on furlough.
18.3.4. CHANGE IN ADDRESS OR TELEPHONE NUMBER
A furloughed Crewmember will notify the Company within
twenty four (24) hours of any change in his address or
telephone number.
18.3.5. STANDING BID
A furloughed Crewmember should maintain his Standing Bid
while on furlough. If no Standing Bid is on file, or if
insufficient choices are listed, the Crewmember will be
recalled to the Base, Type and Crew Class of the Company's
choice.
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18.3.6. FURLOUGH EXPIRATION
A Crewmember who has not been recalled within six (6) years
from the date of his furlough will forfeit his seniority and
will not be entitled to recall.
18.4. RECALL
When a vacancy exists in a Category that is not filled in accordance
with Section 16, the Company will recall a furloughed Crewmember in
that Category before filling the vacancy with a new-hire Crewmember.
18.4.1. CATEGORY SENIORITY ORDER
A furloughed Crewmember will be recalled in Category
seniority order to unfilled vacancies in his Category.
However, a furloughed Second Officer meeting the
requirements of subsection 19.1.2.1. will be recalled to
First Officer provided no Pilot is on furlough, and, a
furloughed Pilot meeting the requirements of subsection
19.1.2.2. will be recalled to Second Officer provided no
Prior Rights Flight Engineer is on furlough and he is unable
to hold a position as First Officer.
18.4.2. BYPASS OF RECALL
If a furloughed Crewmember desires to be bypassed for
recall, he must notify the Company in writing that he wishes
to be placed on the bypass list. The Crewmember may remove
his name from the bypass list at any time. If all furloughed
Crewmembers in a Category are on the bypass list at the time
of a recall, the most junior Crewmember in the recalled
Category on the bypass list must accept recall or he will be
terminated.
18.4.3. RECALL NOTICE
A notice of recall will be in writing, by certified or
registered mail, return receipt requested, to the
Crewmember's last address on file with the Company, with a
copy to the Union. The recalled Crewmember must reply in
writing to the Company, by certified or registered mail,
return receipt requested, within seven (7) Days of date of
receipt of the recall notice. A Crewmember accepting recall
must be able to report for duty within fourteen (14) Days of
receipt of the recall notice. If the Crewmember's address on
file with the Company is outside the United States, he will
be allowed thirty-one (31) Days in which to be able to
report for duty. If, after accepting recall, the Crewmember
is unable to report for duty because of circumstances beyond
his control, he will be placed on an appropriate leave of
absence.
18.4.4. WAIVER OF RECALL NOTICE
A Crewmember may accept early recall and waive the
provisions of subsection 18.4.3., above, by telephone or any
other means. Oral waivers will be followed up in writing.
18.4.5. FAILURE TO RESPOND OR REPORT
A Crewmember will be terminated if he fails to state his
intent to accept recall within seven (7) Days of receipt of
the recall notice, if the US Post Office informs the Company
that the recall notice is undeliverable, if he fails to
respond to a recall notice within thirty-one (31) Days of
the mailing of the recall notice or if he fails to report
for duty after recall.
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18.4.6. MINIMUM RECALL DURATION
A recall will be for a minimum of sixty (60) Days.
18.4.7. NEW-HIRE FLYING EXCLUSION
A new-hire Crewmember will not be placed on Flight Pay
status until all recalled Crewmembers in his Category have
been placed on Flight Pay status unless a recalled
Crewmember fails to complete Training successfully or delays
his own Training.
18.4.8. PAY WHEN RECALLED
Should qualification or requalification be necessary, a
recalled Crewmember will be paid new-hire pay during such
qualification or requalification, for not more than thirty
(30) Days. If the qualification or requalification period
exceeds thirty (30) Days, the Crewmember will receive his
applicable MBPG for that portion of the qualification or
requalification period that exceeds thirty (30) Days.
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SECTION 19 - TRAINING
19.1. QUALIFICATIONS
19.1.1. FAA REQUIREMENTS
A Crewmember must meet all FAA qualifications and
certification requirements applicable to his Crew Class and
Type.
19.1.2. COMPANY MINIMUM REQUIREMENTS
The minimum requirements for bid award are set forth below.
The Company may reduce the requirements provided they are
applied equally to all Crewmembers in any notice of vacancy.
The minimum requirements may be increased if required by the
FAA or with the agreement of the Union.
19.1.2.1. FIRST OFFICER MINIMUM REQUIREMENTS:
19.1.2.1.1. CERTIFICATES
A Commercial Pilot Certificate with
Instrument and Multi-Engine Land
Rating; and
19.1.2.1.2. FLYING EXPERIENCE
1,500 hours total pilot time; and
19.1.2.1.3. MEDICAL CERTIFICATE
An FAA First Class Medical
Certificate, and
19.1.2.1.4. SIMULATOR EVALUATION
A satisfactory simulator evaluation;
and
19.1.2.1.5. WRITTEN EXAMINATION
Successfully complete the FAA ATP
written examination or an equivalent
Company examination.
19.1.2.1.6. FLIGHT ENGINEER UPGRADES
A Flight Engineer may use fifty
percent (50%) of his Flight Engineer
time with the Company, up to a maximum
of 750 hours, to satisfy the
requirement set forth in subsection
19.1.2.1.2.
19.1.2.2. SECOND OFFICER MINIMUM REQUIREMENTS:
19.1.2.2.1. CERTIFICATES
A Commercial Pilot Certificate with
Instrument and Multi-Engine Land
Ratings; and
19.1.2.2.2. FLYING EXPERIENCE
1,500 hours total pilot time; and
19.1.2.2.3. MEDICAL CERTIFICATE
An FAA First or Second Class Medical
Certificate, and
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19.1.2.2.4. WRITTEN EXAMINATION
Successfully complete the FAA Flight
Engineer written examination(s).
19.1.2.3. PROFESSIONAL FLIGHT ENGINEER MINIMUM REQUIREMENTS:
19.1.2.3.1. CERTIFICATES
An Aircraft Mechanic Certificate with
Airframe and Powerplant Ratings. A
Flight Engineer Certificate with a
Turbojet Rating; and
19.1.2.3.2. MEDICAL CERTIFICATE
An FAA First or Second Class Medical
Certificate; and
19.1.2.3.3. COMPANY EMPLOYEES
A Company employee may substitute the
appropriate FAA written examination(s)
for the Flight Engineer Certificate
requirement set forth in subsection
19.1.2.3.1.
19.1.2.4. CAPTAIN MINIMUM REQUIREMENTS:
19.1.2.4.1. CERTIFICATES
An Airline Transport Pilot
Certificate; and
19.1.2.4.2. FLYING EXPERIENCE
5,000 hours of total pilot time, or,
twenty-four (24) Months of pilot
experience on Company aircraft, or,
500 hours of pilot time with the
Company in Type, but not less than
2,500 hours of total pilot time; and
19.1.2.4.3. MEDICAL CERTIFICATE
An FAA First Class Medical
Certificate.
19.1.2.4.4. FIRST OFFICER UPGRADES
A First Officer with the Company is
exempted from the requirements of
subsection 19.1.2.4.1., provided he
has passed the FAA ATP written
examination.
19.2. COMPANY-PROVIDED TRAINING
The Company will provide the necessary manuals and Training to meet
the requirements of the FAA-Approved Training Program at no cost to
the Crewmember.
19.3. TRAINING RECORDS REVIEW
A Crewmember may review all pertinent forms at the conclusion of each
Training or check period. He will be provided a copy of his Training
event form(s) at the conclusion of each Training course or check
period. The Crewmember will sign the Training event form(s). Upon
written request to the Training Department, a Crewmember may review
his permanent Training record.
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19.4. NOTICE OF TRAINING
The Company will provide at least seven (7) Day's notice of all
ground and simulator Training unless the Crewmember agrees to shorter
notice.
19.5. TRAINING SCHEDULES
19.5.1. RECURRENT GROUND SCHOOL
Recurrent ground school will not be scheduled so as to
conflict with a Crewmember's scheduled vacation. However, in
a Crewmember's grace Month, when the scheduling of recurrent
ground school is the result of his own actions, recurrent
ground school may conflict with his scheduled vacation. If
more than one (1) recurrent ground school period is
available in a Bid Period, the ground school periods will be
assigned at the Company's discretion.
19.5.2. RECURRENT SIMULATOR TRAINING
Recurrent simulator Training and recurrent proficiency
checks will not be scheduled so as to conflict with a
Crewmember's scheduled vacation, unless a Crewmember is in
his grace Month. A Crewmember must attend his assigned
recurrent simulator Training period(s) and recurrent
proficiency check(s).
19.5.3. ONE-IN-SEVEN
Unless waived by all Crewmembers in a Training class, a
Crewmember will be provided at least one (1) period of
twenty-four (24) consecutive hours free of all duty during
any seven (7) consecutive Days assigned to Training, except
for recurrent Training.
19.5.4. MINIMUM SCHEDULED DAYS FREE OF DUTY
A Crewmember scheduled for initial, transition or upgrade
Training of fifteen (15) or more Days duration will be
scheduled for five (5) consecutive Days free of duty prior
to the commencement of such Training. A Crewmember may waive
such Days free of duty. However, such waiver will not cause
the waived Days to be paid under subsection 5.9. Training
will not be scheduled for seven (7) consecutive Days.
19.5.5. REST BEFORE SIMULATOR
If a Crewmember reports directly from line flying to the
simulator, the Company will schedule that Crewmember for
twelve (12) hours free of all duty between arrival at the
simulator city and the simulator briefing. If, because of
circumstances beyond the Company's control, less than ten
(10) hours free of all duty is available, the Crewmember may
elect to reschedule the simulator period.
19.5.6. SIMULATOR PERIOD DURATION
Simulator Training or check periods will not be scheduled to
exceed four (4) hours per Day, excluding briefing and
debriefing.
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19.6. INITIAL, UPGRADE AND TRANSITION TRAINING FAILURES
19.6.1. FIRST TRAINING FAILURE
When a successful bidder fails to qualify, he will be
returned to his former Crew Class and Type and will be given
requalification Training in accordance with the Company's
FAA-Approved Training Program. If the Crewmember fails to
requalify, he may be terminated. If his former Type is no
longer a part of the Company fleet, he will be given his
second Training attempt.
19.6.2. INELIGIBILITY TO BID AFTER FAILURES
A Crewmember who fails to complete Training successfully or
fails a pre-Training simulator evaluation will be ineligible
to bid on any vacancy requiring Training until he has
completed an additional five hundred (500) hours and twelve
(12) Months of active flying on the Type to which he is
assigned. The Company may waive this restriction. A
withdrawal from Training will be considered a failure to
complete Training under the terms of this Section.
19.6.3. SECOND TRAINING FAILURE
A Crewmember who fails to complete two (2) consecutive
Initial, Upgrade or Transition Training events successfully
may be terminated or be returned to his former Crew Class
for the duration of his employment.
19.6.4. FAILURE TO MEET TRAINING TIME LINES
A Crewmember who fails to complete Training because of the
failure to meet FAA-mandated Training time lines will
receive additional Training. If the failure to meet the time
lines was for reasons beyond the Crewmember's control and he
subsequently fails to complete Training successfully, he
will not be subject to subsection 19.6.3. However, he will
be subject to subsection 19.6.2.
19.6.5. FAILURE TO PASS PRE-TRAINING EVALUATIONS
A Crewmember who fails three (3) consecutive pre-Training
simulator evaluations may be restricted in his present Crew
Class for the duration of his employment.
19.7. RECURRENT TRAINING FAILURES
19.7.1. FIRST FAILURE
A Crewmember who fails to complete a recurrent Training
event successfully will be given additional Training in the
areas of deficiency, as determined by the Director of
Training in consultation with the Professional Standards
Committee.
19.7.2. SECOND FAILURE
A Crewmember who receives additional Training and
subsequently fails to complete recurrent Training
successfully may be terminated.
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19.8. PROFESSIONAL STANDARDS COMMITTEE INVOLVEMENT
19.8.1. TRAINING FAILURES
The Company will advise a member of the Professional
Standards Committee whenever a Crewmember fails to complete
any Training event. Upon request, the Director of Training
will consult with a member of the Professional Standards
Committee and the Crewmember before the disposition of the
affected Crewmember is determined.
19.8.2. COMMITTEE MEMBER PAY PROTECTION
Committee Member pay protection is dealt with in subsection
28.7.
19.9. TRAINING PAY
Training Pay is dealt with in Section 5.
19.10. GENERAL
19.10.1. REVENUE FLYING
Except for OE, a Crewmember will not be required to fly a
revenue flight while in initial or transition Training.
19.10.2. PROBATIONARY CREWMEMBERS
Training of probationary Crewmembers will be handled at the
Company's discretion.
19.10.3. RECURRENT TRAINING ORDER
Recurrent ground school must be completed successfully prior
to administering simulator Training or a proficiency check.
19.10.4. RE-INDEXING
The Company may reschedule the due Month of recurrent
Training to equalize the number of Crewmembers needing
recurrent Training over a twelve (12) Month period. The
Company will provide at least thirty (30) days notice to a
Crewmember whose due Month is being rescheduled. The
Crewmember may waive such notice.
19.10.5. GROUND TRANSPORTATION
The Company will provide ground transportation between a
place of lodging and a Training facility if ground
transportation is not provided by the place of lodging or
the Training facility.
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SECTION 20 - SCHEDULING
20.1. BID PERIOD
A Bid Period will contain twenty-eight (28) days. The Company may
utilize Bid Periods of other than twenty-eight (28) Days with mutual
agreement between the Union and the Company.
20.1.1. MULTIPLE BID PERIODS AWARDED SEPARATELY
The Company may include up to three (3) Bid Periods in one
(1) Bid Package. Each Bid Period will be bid and awarded
separately and sequentially.
20.1.2. MULTIPLE BID PERIODS AWARDED CONCURRENTLY
When a scheduling requirement exceeds twenty-eight (28), but
no more than fifty-six (56) days, the Company may include
two (2) bid periods in one (1) Bid Package for one (1) or
more Lines of Flying, Composite Lines or Reserve Lines. The
two (2) bid periods will be bid and awarded as if they were
one (1) Bid Period. Concurrently awarded or assigned
consecutive Bid Lines will not contain more than twenty-one
(21) consecutive duty Days.
20.2. BID LINE CONSTRUCTION
20.2.1. LINES OF FLYING, COMPOSITE LINES AND RESERVE LINES
The Company will construct Lines of Flying that may contain
Days free of duty, Trip Sequences and reserve Days. The
Company may also construct Composite Lines that will be
blank when published. The Company may also construct Reserve
Lines containing Days free of duty and reserve Days. Reserve
Days on a Bid Line will be designated R-1, R-2 or R-3. Lines
of Flying will contain all known flying, except that the
Company may withhold from Lines of Flying up to five (5)
percent of known flying, by Type, Base and Crew Class, to be
used for management flying or Training. Such time may be
designated Open Time at the Company's discretion.
20.2.1. SCHEDULED DUTY FREE DAYS
Except as provided in subsection 17.4., release for a
Crewmember's scheduled Days free of duty will occur in his
Base or Residence Airport.
20.2.1.1. MINIMUM SCHEDULED DUTY FREE DAYS
Bid Lines will contain a minimum of twelve (12)
scheduled Days free of duty.
20.2.1.2. INVIOLATE SCHEDULED DUTY FREE DAYS
A Crewmember may declare up to three (3)
consecutive scheduled duty free Days as
inviolate. Such declaration must be made not
later than forty-eight (48) hours prior to the
beginning of the Bid Period. A Crewmember is not
required to perform duty, including Junior
Assignment and Training, on an inviolate
scheduled duty free Day.
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20.2.2.3. MINIMUM CONSECUTIVE SCHEDULED DUTY FREE DAYS
The minimum scheduled duty free Days required in
subsection 20.2.2.1. will be scheduled in a
maximum of two (2) blocks of Days off, with a
minimum of three (3) Days off in any block.
Additional Days free of duty may be in blocks of
less than three (3).
20.2.2.4. CONTACT ON SCHEDULED DUTY FREE DAYS
A Crewmember is not required to keep the Company
informed of his whereabouts or carry a pager
while on his scheduled duty free Days. A
Crewmember is not required to maintain contact
with the Company on a scheduled duty free Day
other than to comply with subsection 20.6.5.
20.3. BID PROCEDURES
20.3.1. ELIGIBILITY TO BID
A Crewmember must be Type and Crew Class current and
qualified at bid close to bid a line. A Crewmember scheduled
for upgrade or transition Training in a Bid Period will not
be awarded a Bid Line that conflicts with such Training. A
Crewmember who is not expected to be available for at least
one half of the Days in the Bid Period will not be awarded a
line. Crew Scheduling will assign or construct a line with
pro-rated scheduled duty free Days, rounded to the nearest
whole Day for a Crewmember who is not awarded a line
pursuant to this subsection. A Crewmember who becomes
available after bid close will be assigned a Reserve Line
with pro-rated scheduled duty free Days, rounded to the
nearest whole Day. The Crew Scheduler will consider a
Crewmember's request regarding the scheduling of such duty
free Days.
20.3.2. BID PACKAGE CONTENTS
A Bid Package will be published for each Type at each Base
for each Bid Period. It will contain Trip Sequence
descriptions including report times, Bid Lines, Open Time,
the bid request form, the Bid Seniority List, Crewmember
vacation dates, the anticipated Recurrent ground school
dates, the anticipated Recurrent simulator periods and a
list of Crewmembers who require recurrent Training.
20.3.3. BID PACKAGE DISTRIBUTION
The Company will mail or e-mail a Bid Package to each
Crewmember's residence and post the Bid Package at Bases and
hubs, not later than twenty (20) Days before the last Day of
the Bid Period prior to the one being bid. If a Crewmember
does not have access to his residence, Bases or hubs, Crew
Scheduling will fax or e-mail a bid package to him upon
request.
20.3.4. BID SUBMISSION
Completed bid request forms may be submitted to the
Scheduling Department. A Crewmember may request confirmation
that his bid has been received.
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20.3.5. BID AWARD SCHEDULE
Bids will close ten (10) Days before the last Day of the Bid
Period prior to the one being bid. The Company will award
and post the awards at Bases and hubs no later than five (5)
Days before the last Day of the Bid Period prior to the one
being bid. A re-bid will not occur after Bid Line awards are
posted. However, this will not prevent correction, within
seventy-two (72) hours of award, for errors in the bid
award.
20.3.5.1. COMPOSITE LINE CONSTRUCTION
No later than seventy-two (72) hours after bid
award, the Company will utilize Open Time,
reserve Days and Days free of duty to construct
Composite Lines. Crewmembers awarded or assigned
Composite Lines will then be provided with a copy
of the Bid Line.
20.3.5.2. RESERVE STATUS CHANGE
A Crewmember may have his reserve status (R-3,
R-2, R-1) on any reserve Day(s) changed before
the beginning of the Bid Period in accordance
with the response times in Section 23. Changes to
reserve status after the beginning of the Bid
Period are dealt with in Section 23.
20.3.6. BID PERIOD TRANSITION
A Crewmember must complete a Trip Sequence that continues
into the subsequent Bid Period.
20.3.6.1. SCHEDULE CONFLICTS
If a Crewmember is awarded or assigned a Bid Line
that conflicts with a Trip Sequence from the
preceding Bid Period (e.g., he must be in two
places at once) or results in a potential
conflict with the FARs, Crew Scheduling will
adjust his Bid Line by dropping the conflicting
Days from the conflicting Trip Sequence(s) or
replacing them with a Trip Sequence(s) or reserve
Day that does not conflict.
20.3.6.2. EXCESS DAYS
If a Crewmember is awarded or assigned a Bid Line
that, in combination with a Trip Sequence that
continues from the preceding Bid Period, will
cause him to have fewer than the minimum
scheduled duty free Days set forth in subsection
20.2.2.1., he may elect to drop sufficient Days
from a Trip Sequence(s) to meet the requirements
of subsections 20.2.2.1. and 20.2.2.3. Such
election will be coordinated with Crew
Scheduling. As an alternative, he may elect to
fly the extra Days and have the Days paid at the
rate set forth in subsection 5.9. If he elects to
fly the Trip Sequence(s), pay under subsection
5.9. will be calculated from the last Day of the
Trip Sequence(s) forward. He must coordinate his
election with Crew Scheduling within forty-eight
(48) hours of the bid award. If the Crewmember
fails to contact Crew Scheduling within
forty-eight (48) hours of the bid award, Crew
Scheduling will adjust his Bid Line by dropping
sufficient Days from a Trip Sequence(s) to cause
his Bid Line to comply with subsections 20.2.2.1.
and 20.2.2.3.
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20.3.7. BID AWARDS
Bids will be awarded in seniority order by Type and Crew
Class in each Base. If a member of the Scheduling Committee
requests to be present at the award, he will be
accommodated, provided that his attendance does not
interfere with his ability to perform any scheduled duty. If
a Captain is unable to hold a line as a Captain because of
an insufficient number of lines, he will be awarded a line
as a First Officer in seniority order after all First
Officers have been awarded their bids.
20.3.8. FAILURE TO BID
If a Crewmember does not bid or if his bid does not comply
with this Section or contain sufficient choices, he will be
assigned a Bid Line after all other bids are awarded.
20.4. OPEN TIME
Open Time is known flying that is not placed into Lines of Flying and
flying that subsequently becomes available during the Bid Period. A
Trip Sequence that is dropped from a Crewmember's Bid Line for
reasons such as vacation, leaves of absence, sick leave, Bid Period
transition or Training is also Open Time. Prior to the beginning of a
Bid Period, Open Time may be used to construct Composite Lines. The
Company may award or assign a partial Trip Sequence.
20.4.1. OPEN TIME AWARD AND ASSIGNMENT
After the beginning of the Bid Period, except for a trip
scheduled to depart within forty-eight (48) hours of the
Company becoming aware of such trip, or for time assigned to
a Crewmember pursuant to other provisions of this Section,
Open Time will be awarded or assigned in the order listed
below:
20.4.1.1. DEDICATED RESERVE
At the Company's option, to a Crewmember who is
serving in a designated reserve or standby role,
such as a reserve that is dedicated to the
specific customer for whom the trip is operating,
e.g., AMC and USPS standby.
20.4.1.2. TRAINING
At the Company's option, to a Crewmember who
requires OE, route qualification or other line
flight Training.
20.4.1.3. SHORTED TIME CREWMEMBER
To a Crewmember, in seniority order, who has lost
flying from his Bid Line and who is on a
scheduled Duty Day.
20.4.1.4. MANAGEMENT CREWMEMBERS
At the Company's option, to a Management
Crewmember.
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20.4.1.5. VOLUNTEER
To a Crewmember, in seniority order by Type,
Category and Crew Class, who has volunteered for
Open Time. The Crewmember will have the option to
either replenish his sick leave bank, in
accordance with subsection 8.4., or be paid for
the flying. The Company may bypass a Crewmember
who, including the Open Time, is projected to
exceed eighty-four (84) actual flight hours for
the Bid Period or FAR annual Flight Time
limitations.
20.4.1.6. RESERVE
To a Crewmember on reserve.
20.4.1.7. JUNIOR ASSIGNMENT
If no reserve is available, to the most junior
available Crewmember on a scheduled duty free
Day. The most junior available Crewmember may be
bypassed if his junior assignment will create a
conflict with a Trip Sequence on his Bid Line.
20.4.1.7.1. MAXIMUM NUMBER OF JUNIOR ASSIGNMENTS
A Crewmember will not be junior
assigned more than six (6) Days in any
thirteen (13) consecutive Bid Periods,
unless the Crewmember agrees
otherwise.
20.4.1.7.2. SCHEDULE CONFLICTS AS A RESULT OF
JUNIOR ASSIGNMENT
A Crewmember who, as a result of a
junior assignment, is required to drop
a subsequent Trip Sequence(s) because
of either FAR or contractual Flight or
Duty Time limitations may be
rescheduled under subsection 20.5.2.
However, he will be credited with the
value of the junior assigned trip and
the greater of the Trip Sequence(s)
dropped or the Trip Sequence(s), if
any, to which he is reassigned.
20.5. RESCHEDULE AFTER BID AWARD
20.5.1. RESCHEDULE FOR TRAINING
20.5.1.1. RESCHEDULE FOR ANOTHER CREWMEMBER'S TRAINING
If the Company removes a Crewmember from a Trip
Sequence(s) or reserve assignment for the purpose
of Training another Crewmember, the Company will
return the Crewmember to his Bid Line as soon as
practical. A Crewmember will not be required to
make up lost time on his scheduled duty free
Days. The Crewmember will be credited with the
greater of the Trip Sequence(s) from which he is
removed or the Trip Sequence(s) or reserve duty,
if any, to which he is assigned.
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20.5.1.2. RESCHEDULE FOR A CREWMEMBER'S OWN TRAINING
If the Company removes a Crewmember from a Trip
Sequence(s) or reserve assignment for the purpose
of his recurrent Training, the Company will
return the Crewmember to his Bid Line as soon as
practical. A Crewmember will not be required to
make up lost time on his scheduled duty free
Days. The Crewmember will be credited with
Training pay pursuant to subsection 5.11.1.1. for
all Days rescheduled.
20.5.2. RESCHEDULE FOR OTHER THAN TRAINING
If the Company removes a Crewmember from a Trip Sequence(s)
for reasons such as trip cancellations, crew legality or
weather, it will return the Crewmember to his Bid Line as
soon as practical. A Crewmember will not be required to make
up lost time on his scheduled duty free Days. The Crewmember
will not be credited for the Trip Sequence(s) from which he
was removed. The Crewmember may be assigned to another Trip
Sequence(s) or to reserve.
20.6. SCHEDULING PROCEDURES
20.6.1. TRIP SEQUENCE TRADES
Trip Sequence trades are permitted in accordance with Crew
Scheduling guidelines.
20.6.2. RESERVE ASSIGNMENTS
Reserve assignments are dealt with in Section 23.
20.6.3. RELEASE FROM DUTY
The Company may release a Crewmember from his Bid Line,
provided there are no additional flying or reserve
requirements.
20.6.4. DUTY AT RESIDENCE
A Crewmember may satisfy his Duty Day(s) on a Line of
Flying, Composite Line or Reserve Line at his residence at
the Company's discretion. A Crewmember will not be paid
in-base per diem or be provided with lodging on such days.
20.6.5. PRE-DUTY CHECK IN
A Crewmember will call Crew Scheduling within twenty-four
(24) to forty-eight (48) hours prior to the first Day of his
duty assignment(s).
20.6.6. POST DUTY CHECK IN
When a Crewmember completes a duty assignment, he will
contact the Company.
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20.7. GENERAL
20.7.1. SCHEDULING COMMITTEE
The Union will appoint a Scheduling Committee composed of
Crewmembers. Bid packages will be made available to
Scheduling Committee members, upon request, before
publication. The Company will consider recommendations of
the Scheduling Committee concerning scheduling policies and
procedures.
20.7.2. MILITARY DUTY
When a Crewmember has military duty of fourteen (14) Days or
less, he must bid all Bid Lines that accommodate such
military duty. Days of military duty will be considered a
Crewmember's scheduled duty free Days. If a Crewmember is
unable or fails to bid around his military duty, he will be
assigned Duty Days that will not conflict with his military
duty requirements.
20.7.3. REQUIRED RECORDS
The Company will keep a record of all Bid Packages and Bid
Line awards or assignments, and bid request forms for
thirteen (13) Bid Periods.
20.7.4. HOSTILE AREAS
Prior to operating a flight(s) into an area with ongoing
armed conflicts that may affect the personal safety of
Crewmembers, the Union and the Company will consult to
determine the procedures for such flight(s).
20.7.5. NOTIFICATION OF APPRECIABLE DELAY
The Company will notify a Crewmember of any appreciable
delay in his departure time as soon as practical after the
delay becomes known.
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SECTION 21 - HOURS OF SERVICE
21.1. FAR CONFLICTS
If an FAR is more restrictive than a provision of this Section, the
FAR will apply.
21.2. DUTY TIME
21.2.1. DIRECTION OF THE COMPANY
During Duty Time, a Crewmember is under the control and
direction of the Company.
21.2.2. REPORT AND RELEASE TIMES
Duty Time or duty period begins when a Crewmember is
required to report for duty (normally one (1) hour prior to
scheduled departure for domestic flights and two (2) hours
for international flights but not more than two and one-half
(2 1/2) hours prior to scheduled departure for any flights)
or actually reports to the airport, whichever is later. Duty
Time or duty period ends fifteen (15) minutes after block-in
at the point where the flight terminates or when the
Crewmember is released by the Company, whichever is later.
If a Crewmember is called to the field for the purpose of
flight and is not used, his Duty Time or duty period ends
when the Crewmember is released by the Company.
21.2.3. REDUCED REPORT TIME
Affected Crewmembers and the Director of Operations, or his
designee, may reduce report time, in coordination with the
Captain, as provided in the Company GOM. A late departure
caused by this reduced report time will not be the
responsibility of the Crewmembers.
21.2.4. SUSPENSION OF DUTY TIME
21.2.4.1. INVOLUNTARY
A Crewmember's Duty Time may be suspended once in
a duty period for less than a required rest
period provided Adequate Rest Facilities,
convenient to the airport, are made available.
The minimum time for such a suspension is five
(5) hours from release to report. If this
provision is exercised by the Company, the
affected Crewmember's previously accumulated Duty
Time is not changed by such suspension. Such
suspension will not be assigned retroactively.
21.2.4.2. VOLUNTARY
A Crewmember may suspend his Duty Time once in a
duty period due to unforeseen operational
circumstances for less than a required rest
period, provided Adequate Rest Facilities are
made available. If this provision is exercised by
the Crewmember, with the concurrence of Crew
Scheduling, his previously accumulated Duty Time
is not changed by such suspension. Such
suspension will not occur retroactively.
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21.2.5. MAXIMUM DUTY TIMES
When scheduling Crewmembers for flying, the Company will not
exceed the following Duty Time limitations:
21.2.5.1. SINGLE CREW - DOMESTIC
Single Crew operating domestic flight(s) only -
sixteen (16) hours.
21.2.5.2. AUGMENTED CREW - DOMESTIC
Augmented Crew operating domestic flight(s) only
- eighteen (18) hours.
21.2.5.3. DOUBLE CREW - DOMESTIC
Double Crew operating domestic flight(s) only -
twenty (20) hours.
21.2.5.4. SINGLE CREW - INTERNATIONAL
Single Crew operating international flight(s) -
eighteen (18) hours.
21.2.5.5. AUGMENTED CREW - INTERNATIONAL
Augmented Crew operating international flight(s)
- twenty six (26) hours.
21.2.5.6. DOUBLE CREW - INTERNATIONAL
Double Crew operating international flight(s) -
thirty (30) hours.
21.2.6. DEADHEAD DUTY LIMITATIONS
Deadhead duty limitations are dealt with in Section 22.
21.3. REST
21.3.1. REST PERIOD
Rest is measured from release from duty until report for
duty as adjusted for operational requirements, delays in
transportation to and from the place of lodging and the
availability of lodging.
21.3.2. MINIMUM REST PERIOD - DOMESTIC
The rest period will be a minimum of eight (8) hours free of
all duty, unless a Crewmember exceeds, or is scheduled to
exceed eight (8) hours of flight in a twenty-four (24) hour
period.
21.3.3. MINIMUM REST PERIOD - INTERNATIONAL
If a Crewmember's duty period is less than eighteen (18)
hours, the rest period will be a minimum of ten (10) hours
free of all duty. If a Crewmember's duty period exceeds
eighteen (18) hours, the rest period will be a minimum of
twelve (12) hours free of all duty.
21.3.4. FATIGUE
If a Crewmember determines that fatigue is a factor in
continuing a flight or series of flights, the Captain will
coordinate with Crew Scheduling a rest period for the
affected Crewmember(s) of not less than twelve (12) hours
free of all duty.
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21.3.5. INTERRUPTION OF REST PERIOD
During a rest period of twelve (12) hours or less, a
Crewmember will not be disturbed by the Company, except to
receive calls no more than two (2) hours prior to report
time or to notify a Crewmember that his flight will be
appreciably delayed. Any other earlier calls from the
Company during a rest period, except in case of personal
emergency, permits the Crewmember to begin a new rest
period.
21.3.6. REST AFTER RELEASE
A Crewmember released from duty after a Trip Sequence that
immediately precedes his scheduled duty free Days may elect
to remain at a release location for a rest period. If he
elects to remain at the release location, the Company will
provide the Crewmember with lodging so long as the release
location is not his Residence Airport and the release occurs
after a duty period of at least twelve (12) hours or viable
transportation from the release location to the Crewmember's
Residence Airport or Base is unavailable within four (4)
hours of release. Deadhead required after release from duty
remains the responsibility of the Company. If a Crewmember
is released at his Residence Airport or Base and elects to
remain in the release location, he will not be entitled to
pay under subsection 5.9.
21.4. GENERAL
21.4.1. MIXING OF DOMESTIC AND INTERNATIONAL FLIGHTS
The Company may combine domestic and international flights
provided the maximum flight and Duty Time limitations of FAR
Part 121 or this Section are not exceeded.
21.4.2. ONE-IN-SEVEN
A Crewmember will receive at least one (1) twenty-four (24)
hour period free of all duty in any consecutive seven (7)
Days. A one-in-seven may be moved by the Company, with
notice to the Crewmember, but will not be assigned
retroactively.
21.4.3. AIRCRAFT REST FACILITIES FOR DOUBLE AND AUGMENTED CREWS
When the Company operates a flight scheduled for twenty (20)
or more hours of duty with a double or an augmented crew,
the aircraft must have enclosed, fully reclining, first
class seats or enclosed bunks with clean bedding to allow
each Crewmember to sleep. When the Company operates a flight
scheduled for less than twenty (20), but more than sixteen
(16), hours of duty with a double or an augmented crew, the
aircraft must have reclining seats located outside the
cockpit to allow each Crewmember to rest.
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SECTION 22 - DEADHEADING AND COMMUTING
22.1. COMMUTING
22.1.1. COMMUTE TO BASE OR ASSIGNMENT
A Crewmember who elects to Commute to his Base is
responsible for being at his Base prior to report time for
an assignment. A Crewmember who wishes to report to his
first point of departure or reserve assignment instead of
reporting to his Base must first coordinate with Crew
Scheduling and report for his first assignment at the time
determined by Crew Scheduling.
22.1.2. DUTY AND REST
Time spent Commuting is not duty. A Crewmember Commuting to
an assignment will ensure that he is adequately rested to
perform his required duties.
22.2. DEADHEADING
22.2.1. COST OF DEADHEAD
The cost of Deadhead transportation will be paid by the
Company.
22.2.2. RESPONSIBILITY FOR DELAYS
When the Company provides transportation to an assignment
for a Crewmember, the Crewmember will not be held
responsible for delays beyond his control.
22.2.3. COMMERCIAL AIR TRANSPORTATION
When negotiating contracts with airline customers, the
Company will attempt to secure, at no additional cost to
itself, business class travel for commercial deadhead legs
that exceed six (6) hours published scheduled time. If such
travel has not been secured, the Company will provide
relevant correspondence to the Union, upon request.
22.2.4. TRANSPORTATION FOR JUNIOR ASSIGNMENT
A Crewmember who performs duty on a scheduled duty free Day
pursuant to Section 20.4.1.7. will be provided deadhead
transportation between his Residence Airport and his
assignment, if necessary, at no cost to the Crewmember.
22.3. DEADHEAD DUTY CALCULATIONS
22.3.1. SINGLE CREW DEADHEAD TO A DUTY ASSIGNMENT
If a Crewmember who is part of a single crew Deadheads to a
duty assignment, he will not be scheduled for the
combination of the Deadhead time and duty in excess of
twenty (20) hours without an intervening rest period. If
such a Crewmember is provided the equivalent of business
class or better transportation, or a bunk, one-half (1/2) of
the Deadhead time will be credited toward the Duty Time
limitations set forth in Section 21.
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22.3.2. AUGMENTED AND DOUBLE CREW DEADHEAD TO A DUTY ASSIGNMENT
If a Crewmember who is part of an augmented or double crew
Deadheads to a duty assignment without an intervening rest
period, one-half (1/2) of the Deadhead time will be credited
toward the Duty Time limitations set forth in Section 21.
22.3.3. DEADHEAD BETWEEN DUTY ASSIGNMENTS
If a Crewmember Deadheads between duty assignments and is
not provided an intervening rest period, all Deadhead time
will be credited toward Duty Time limitations.
22.3.4. DEADHEAD FROM A DUTY ASSIGNMENT
If a Crewmember Deadheads from a duty assignment to his
Residence Airport or Base, the Deadhead time will not be
credited toward Duty Time limitations, provided the
Crewmember waives his required rest period.
22.3.5. DEADHEAD TO AND FROM TRAINING
If a Crewmember Deadheads to and from a Training assignment,
the Deadhead time will not be credited toward Duty Time
limitations. For the purpose of this subsection, OE is not
Training.
22.4. NO COCKPIT DUTY DURING DEADHEAD
A Crewmember will not be required to operate the aircraft when
Deadheading.
22.5. DEADHEAD PAY
22.5.1. AIR TRANSPORTATION
A Crewmember who Deadheads by air will be credited with
Flight Pay for one-half (1/2) of the published scheduled
time. If a Crewmember Deadheads by air on a segment for
which there is no published schedule, he will be credited
with Flight Pay for one-half (1/2) of the Block-to-Block
time.
22.5.2. SURFACE TRANSPORTATION
A Crewmember who Deadheads by surface transportation will be
credited with Flight Pay for one-fourth (1/4) of the
published scheduled time. If a Crewmember Deadheads by
surface transportation on a segment for which there is no
published schedule, he will be credited with Flight Pay for
one-fourth (1/4) of the actual time.
22.5.3. REPORT TO DUTY ASSIGNMENT INSTEAD OF BASE
A Crewmember who reports to a duty assignment directly from
his Residence Airport in accordance with subsection 22.1.1.
will be paid Deadhead pay as if he had Deadheaded from his
Base to the duty assignment.
22.5.4. TRAINING
Travel to and from Training not in a Crewmember's Base is
Deadhead. Travel between Training in a Crewmember's Base and
a duty assignment on a scheduled Duty Day is Deadhead. All
other travel to and from Training is a Commute.
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SECTION 23 - RESERVE
23.1. LONG CALL RESERVE (R - 3)
Long call reserve will be performed at a Crewmember's residence. A
long call reserve Day begins at 0000Z and ends at 2359Z. A Crewmember
on R-3 may be moved up to either R-2 or R-1.
23.1.1. CONTACT
When on long call reserve, a Crewmember must be able to be
contacted at his designated telephone number, pager or
answering machine. A Crewmember who elects to use an
answering machine or a pager is considered to have been
contacted when the pager is activated or a message is left
by Crew Scheduling. A Crewmember on long call reserve must
return a call to Crew Scheduling within one (1) hour of
being paged or from the time of the message, unless other
arrangements are made with Crew Scheduling.
23.1.2. RESPONSE
A Crewmember on long call reserve will use his best efforts
to obtain the first available departure from his Residence
Airport, unless a later departure is selected by Crew
Scheduling. A Crewmember on long call reserve must be able
to report to either his Base or another location that can
reasonably be reached within twelve (12) hours after being
contacted by Crew Scheduling. A Crewmember on R-3 who is
moved up to R-2 or R-1 must be able to report to the R-2 or
R-1 location within twelve (12) hours after being contacted
by Crew Scheduling.
23.1.3. COMPENSATION
A Crewmember who performs long call reserve on a scheduled
duty free Day will be paid in accordance with subsection
5.9.
23.1.4. EXPENSES
A Crewmember on long call reserve will not be provided
lodging or Per Diem.
23.2. SHORT CALL RESERVE (R - 2)
Short call reserve will be performed at any Company-designated
location. A Crewmember on R-2 may be moved up to R-1 or moved down to
R-3.
23.2.1. CONTACT
A Crewmember on short call reserve must be able to be
contacted at his designated telephone number or pager. A
Crewmember who elects to use a pager is considered to have
been contacted when the pager is activated. A Crewmember on
short call reserve must return a call to Crew Scheduling
within twenty (20) minutes of being paged or from the time
of a message, unless other arrangements are made with Crew
Scheduling.
23.2.2. RESPONSE
A Crewmember on short call reserve must be at the location
designated by the Company as soon as possible but no later
than two (2) hours after being contacted by Crew Scheduling.
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23.2.3. COMPENSATION
A Crewmember who holds a Line of Flying or a Composite Line
who performs short call reserve will be credited with the
greater of three point five (3.5) hours of Flight Pay for
each such Day or the actual pay credit for that Day. A
Crewmember who performs short call reserve on a scheduled
duty free Day will be paid in accordance with subsection
5.9.
23.2.4. EXPENSES
A Crewmember on short call reserve will be provided lodging
and Per Diem in accordance with Section 6 and subsection
17.3.3.
23.2.5. ASSIGNMENT
If more than one qualified Crewmember, by Type and Crew
Class, is on short call reserve at the same location,
assignments will be on a first-in, first-out basis, except
when legality, Flight Time, Duty Time or scheduled Days free
from duty considerations preclude such an assignment order.
23.3. STANDBY (R - 1)
Standby will be performed at any Company-designated location. A
Crewmember on R-1 may be moved down to either R-2 or R-3. Duty Time
for standby begins when a Crewmember reports to the airport or other
standby location assigned by the Company and ends when the Crewmember
is released.
23.3.1. CONTACT
A Crewmember on standby must be available for immediate
contact by Crew Scheduling.
23.3.2. RESPONSE
Taking into account operational considerations, a Crewmember
on standby must be able to depart from the assigned airport
within one (1) hour of being contacted by Crew Scheduling.
23.3.3. COMPENSATION
A Crewmember on standby will be credited with three point
five (3.5) hours of Flight Pay for each standby Day or the
actual Flight Pay credit for the Day, whichever is greater.
A Crewmember who performs standby on a scheduled duty free
Day will be paid in accordance with subsection 5.9.
23.3.4. EXPENSES
A Crewmember on standby will be provided lodging and Per
Diem in accordance with Section 6 and subsection 17.3.3.
23.3.5. ASSIGNMENT
If more than one qualified Crewmember, by Type and Crew
Class, is on standby at the same location, assignments will
be on a first-in, first-out basis, except when legality,
Flight Time, Duty Time or scheduled Days free of duty
considerations preclude such an assignment order.
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23.3.6. REST FACILITIES
A Crewmember on standby for more than six (6) hours will be
provided Adequate Rest Facilities or the aircraft rest
facilities set forth in subsection 21.4.3.
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SECTION 24 - DISCIPLINE AND DISCHARGE
24.1. HOLDING OUT OF SERVICE
Prior to disciplining or discharging a Crewmember, the Company may
hold the Crewmember out of service, with pay, until the conclusion of
an investigatory hearing. Thereafter, the Crewmember may be held out
of service pending further investigation with or without pay. If a
Crewmember is held out of service without pay, the Company will
either take disciplinary action or restore the Crewmember to pay
status within sixty (60) Days after the conclusion of an
investigatory hearing.
24.2. INVESTIGATORY HEARING
The Company will notify the Crewmember and the Union of the time,
date and location of an investigatory hearing. A Crewmember may be
represented by a Union representative at an investigatory hearing. It
is the responsibility of the Crewmember to obtain Union
representation.
24.2.1. EXPENSES
The Company will provide transportation and lodging for a
Crewmember required to attend an investigatory hearing,
except when the Crewmember is scheduled to be in the
location of the hearing or resides in the location of the
hearing or is Based in the location where the hearing will
be held.
24.3. WRITTEN NOTIFICATION
The Company will notify a Crewmember in writing of the reasons for
any discipline or discharge, with a copy to the Union.
24.4. GRIEVANCE RIGHTS
A Crewmember who has been disciplined or discharged may file a
grievance pursuant to Section 25. A non-probationary Crewmember who
has been discharged may file a grievance directly at the step
contained in subsection 25.4.
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SECTION 25 - GRIEVANCE PROCEDURE
25.1. GRIEVANCE DEFINITION
A grievance is defined as a dispute between the Company and a
Crewmember or the Union arising out of the interpretation or
application of this Agreement or the discipline or discharge of a
Crewmember. Grievances will not include proposed changes in rates of
pay, hours of service or working conditions.
25.2. STEP ONE - REQUEST FOR RELIEF
Prior to filing a written grievance and within ten (10) Days after
the Crewmember became aware or reasonably should have become aware of
the circumstances from which the grievance arose, the Crewmember will
discuss the matter with the Chief Pilot, or his designee, in an
effort to resolve it. The Chief Pilot, or his designee, will respond
to the Crewmember within ten (10) Days of the discussion.
25.3. STEP TWO - FILING A WRITTEN GRIEVANCE
If the Crewmember is not satisfied with the Chief Pilot's, or his
designee's, response or if the Chief Pilot, or his designee, does not
respond within ten (10) Days after the discussion in subsection
25.2., the Union may file a written grievance with the Director of
Operations, or his designee, by certified or registered mail, return
receipt requested. Written grievances must contain a reference to the
provision of the Agreement alleged to have been violated, a statement
of the facts involved which is sufficiently detailed to allow
investigation of the incident and any supporting documentation.
25.3.1. TIMELINES FOR FILING AND RESPONSE
Except for discharge grievances, a grievance must be filed
within thirty (30) Days after the Crewmember receives an
unsatisfactory response made in accordance with subsection
25.2., above, or forty (40) Days after the Crewmember
discusses the matter with his Chief Pilot, or his designee,
whichever occurs first. In the case of a discharged
Crewmember, the Union must file a grievance within thirty
(30) Days after the Crewmember receives written notice of
discharge. The Director of Operations, or his designee, will
file his decision with the Union in writing within twenty
(20) Days after receiving the grievance from the Union by
certified or registered mail, return receipt requested.
25.4. STEP THREE - APPEAL TO SYSTEM BOARD OF ADJUSTMENT
If the decision in subsection 25.3.1., above, is not satisfactory,
the Union may appeal the decision to the Chairman of the System Board
of Adjustment, with a copy to the Vice-Chairman. The appeal must be
made in writing within fifteen (15) Days after receipt of the
decision of the Director of Operations, or his designee, with a copy
of the appeal to the Director of Operations, or his designee, sent by
certified or registered mail, return receipt requested.
25.5. TIMELINE VERIFICATION
Filing dates will be considered to be postmark dates. Receipt dates
will be considered to be the dates on the return receipt.
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25.6. TIME LIMIT EXTENSIONS AND PENALTIES
All time limits in this Section may be extended by mutual agreement
of the parties, confirmed in writing. If any decision made by the
Company is not appealed by the Union within the time limit prescribed
for such appeal, the decision of the Company will become final and
binding. If the Company fails to render a decision within the time
limits prescribed above, the grievance will be considered denied and
automatically appealed to the System Board of Adjustment.
25.7. PROBATIONARY CREWMEMBER EXCLUSION
A probationary Crewmember may not file a grievance involving
discipline or discharge.
25.8. UNION REPRESENTATION
Upon request, a Crewmember may be represented by a Union
representative at any step of the Grievance Procedure.
25.9. RECORDING OF SETTLEMENT
If a grievance is settled, the settlement will be reduced to writing
with a date certain for implementation. The Union will mail a copy
of the settlement to the affected Crewmember(s) not later than
thirty (30) Days after settlement.
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SECTION 26 - SYSTEM BOARD OF ADJUSTMENT
26.1. THE BOARD
In compliance with the Railway Labor Act, as amended, a System Board
of Adjustment is hereby established for the purpose of adjusting and
deciding grievances that may arise under the terms of the Grievance
Procedure and that are properly submitted to it. The Board will be
known as The "Kitty Hawk International, Inc. Crewmembers' System
Board of Adjustment," hereafter referred to as the "Board."
26.2. COMPOSITION OF THE BOARD
26.2.1. MEMBER SELECTION
The Board will consist of four (4) members. Two (2) will be
selected by the Company and two (2) will be selected by the
Union. These appointees will be known as "Board Members." In
addition, the Company and the Union will each select an
alternate. If a Board Member is unavailable, the alternate
will serve in place of the absent Board Member. All members
of the Board will be employees of the Company.
26.2.2. TERMS OF OFFICE FOR BOARD MEMBERS
The Board Members and their alternates will serve for one
(1) year from the date of their selection and, thereafter,
until their successors have been selected. Vacancies will be
filled within thirty (30) Days in the same manner provided
for the selection of the original Board Members and
alternates.
26.2.3. CHAIRMAN AND VICE CHAIRMAN
The office of Chairman will be filled and held alternately
by a Board Member selected by the Union and by a Board
Member selected by the Company. When a Board Member selected
by the Union is Chairman, a Board Member selected by the
Company will be Vice Chairman and vice versa. The Chairman
or, in his absence, the Vice Chairman, will preside at
meetings of the Board and at hearings and will have a vote
in connection with all actions taken by the Board.
26.2.4. TERMS OF OFFICE FOR CHAIRMAN AND VICE CHAIRMAN
The terms of office of Chairman and Vice Chairman will be
one (1) year. A Company Board Member will be Chairman in odd
numbered years; a Union Board Member will be Chairman in
even numbered years. Terms of office will commence on
January 1 of each year.
26.3. MEETING SCHEDULE
The Board will meet quarterly in the city where the Company's general
offices are located, unless the Parties agree upon an alternate
location, at a time to be fixed by the Board, provided that at that
time there are cases filed with the Board for consideration. The
meetings will continue in session until all matters before the Board
have been considered, unless otherwise mutually agreed to in writing.
The Chairman may schedule additional meetings if requested by at
least two (2) other Board Members. Each Party will assume the cost of
their own expenses.
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26.4. BOARD MEMBER COMPENSATION
Crewmembers will be released from flight duty to serve on the Board.
Each Party will bear the cost of the compensation and expenses of its
Board Members.
26.5. JURISDICTION OF THE BOARD
26.5.1. LIMITATIONS
The Board has jurisdiction over all grievances growing out
of this Agreement. The jurisdiction of the Board does not
extend to proposed changes in rates of pay, hours of service
or working conditions.
26.5.2. REQUIREMENTS
The Board will consider any grievance properly submitted to
it, provided that the grievance has not been previously
settled in accordance with the provisions of Section 25.
26.6. PROCEEDINGS BEFORE THE BOARD
26.6.1. AGENDA AND SUBMISSIONS
The Company and the Union will determine the agenda for the
Board not less than ten (10) Days prior to the date of the
hearing. The Union will forward copies of each submission,
including all papers and exhibits, to each Board member no
later than seven (7) Days prior to the date of the hearing.
Each submission will include the following:
26.6.1.1. ISSUE
Question or questions at issue, including the
Section of the Agreement alleged to have been
breached; and
26.6.1.2. FACTS
Statement of facts; and
26.6.1.3. GRIEVANT POSITION
Position of the grievant(s); and
26.6.1.4. COMPANY POSITION
Position of the Company; and
26.6.1.5. DOCUMENTATION
Available supporting documentation.
26.6.2. ADDITIONAL MEETING DATES
If at least two (2) Board Members, one (1) from the Company
and one (1) from the Union, consider a matter of sufficient
urgency, an additional Board will meet at an earlier date
and place agreeable to the Board Members. The meeting will
be not more than thirty (30) Days after such request for a
meeting is made. The Chairman will give the necessary
notices of such a meeting to the Board Members and to the
parties to the dispute.
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26.6.3. REPRESENTATION
Crewmembers may be represented at the Board hearing by any
person, or persons, as they may choose and designate. The
Company may be represented by any person, or persons, as it
may choose and designate. Evidence may be presented either
orally or in writing, or both.
26.6.4. WITNESSES
The Board Members selected by either Party may summon
witnesses who are deemed necessary by such Board Members.
Each Party will bear the cost of the compensation and
expenses of witnesses summoned by its Board Members. The
number of witnesses summoned at any one time will not be
greater than the number that can be spared without
interference with the operation of the Company. Each Party
may present witnesses on its behalf. Each Party will bear
the cost of the compensation and expenses of its witnesses.
26.6.5. COMPETENCY
The Board is competent to hear any grievance properly
submitted to it and decide that grievance by a majority vote
of all members of the Board. Decisions of the Board will be
in writing, final and binding, and will include
implementation dates. The Company will mail a copy of the
decision to the affected Crewmember(s) not later than thirty
(30) Days after decision is rendered.
26.7. DEADLOCK PROCEDURES
26.7.1. SUBMISSION TO ARBITRATION
When a grievance is properly submitted to the Board and the
Board is unable, by majority vote, to decide the grievance,
the Board will declare itself deadlocked. The grievance upon
which the Board is deadlocked may be submitted to
arbitration by the Union or the Company within twenty (20)
Days from the close of the Board hearing by written notice
to the other Party with copies to the Chairman and Vice
Chairman of the Board.
26.7.2. FAILURE TO TIMELY SUBMIT TO ARBITRATION
If notice that arbitration is desired is not properly served
upon the other Party, with a copy to the Chairman and the
Vice-Chairman within twenty (20) Days after the close of the
Board hearing, the arbitrator will have no jurisdiction to
consider that grievance, and the grievance will be
considered withdrawn.
26.8. FREEDOM TO ACT INDEPENDENTLY
Each Board Member will be free to discharge his duty in an
independent and uncoerced manner without fear that his individual
relations with the Company, the Crewmembers, or the Union will be
affected in any manner by any action taken by him in good faith in
his capacity as a Board Member.
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SECTION 27 - ARBITRATION
27.1. THE ARBITRATION PROCEDURE
An arbitration procedure is hereby established for the purpose of
adjusting grievances that may arise under the terms of the Grievance
Procedure and that are properly submitted to the procedure after all
steps for settling grievances in the Grievance Procedure and System
Board of Adjustment have been exhausted.
27.2. STANDING PANEL
If any grievance is properly appealed to arbitration, the arbitrator
will be appointed by mutual agreement of the Company and the Union
from the following standing panel of arbitrators:
Benjamin Aaron
Richard Bloch
Herbert Fishgold
Robert Harris
Peter Meyers
M. David Vaughn
Nicholas Zumas
The Parties may mutually agree to add to or delete from the panel of
arbitrators. The panel must always contain an odd number of
arbitrators, but never less than seven (7).
27.3. ARBITRATOR SELECTION METHOD
If the Parties are unable to agree on the selection of an arbitrator,
the Company and the Union will alternately strike a name from the
panel until only one name remains. That individual will serve as the
arbitrator for the grievance at issue. The order in which the Parties
alternately strike names from the panel will be determined by a coin
toss.
27.4. HEARING DATE AND LOCATION
The arbitrator will hear and decide the grievance as promptly as
possible. All hearings will be held at a place determined by the
Company and the Union.
27.5. EXPENSES
Each of the Parties will assume the compensation, traveling expense,
and other expenses of its representatives and witnesses called or
summoned by it. The number of witnesses summoned at any one time will
not be greater than the number that can be spared without
interference with the operation of the Company.
27.6. ARBITRATOR'S COMPENSATION AND EXPENSES
The compensation, traveling expense and other expenses of the
arbitrator will be shared equally between the Company and the Union.
27.7. COURT REPORTER COST
If the Company or the Union independently requests that a court
reporter be present at the hearing, the cost of the court reporter
will be borne by the requesting party. If both Parties request a
court reporter, the cost will be shared equally between the Company
and the Union.
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27.8. LIMITATIONS
The arbitrator will have no power to add to, subtract from, or modify
any of the terms of this Agreement.
27.9. AWARDS
The award of the arbitrator will be final and binding on both
Parties. The award of the arbitrator will be enforceable, at law or
in equity, in any Federal Court having jurisdiction. The Company
will mail a copy of the award to the affected Crewmember(s) not
later than thirty (30) Days after it receives the award.
27.10. JURISDICTION
The arbitrator will have the sole and exclusive jurisdiction to
determine whether a particular grievance is arbitrable.
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SECTION 28 - PROFESSIONAL STANDARDS COMMITTEE
28.1. COMMITTEE SELECTION
The Union will appoint a Professional Standards Committee composed of
Crewmembers. The Union will provide the Director of Operations, or
his designee, with a current list of Professional Standards Committee
members.
28.2. COMMITTEE PURPOSE
The purpose of the Professional Standards Committee is to identify
problems affecting the professionalism, Training, safety and the
overall performance of Crewmembers. The goal of the Professional
Standards Committee is to identify and correct problems through early
intervention before official notice and action is required.
28.3. COMPANY INTERACTION
The Professional Standards Committee will confer and attempt to reach
consensus with the Company on matters relating to professional
standards.
28.4. REPORTS
The Professional Standards Committee will be under no obligation to
report its activities to the Company.
28.5. CONFIDENTIALITY
The Professional Standards Committee will maintain confidentiality in
all of its functions, except where necessary to prevent the
compromise of safety or injury to personnel or property.
28.6. INVESTIGATIONS
The Professional Standards Committee will investigate any problems
brought to its attention by Crewmembers or the Company.
28.7. COMMITTEE MEMBER PAY PROTECTION
The Director of Operations, or his designee, will release
Professional Standards Committee members to pursue Committee
functions, consistent with reasonable scheduling requirements. In
such case, the Committee member will suffer no loss of pay or
benefits if the Committee member is pursuing Committee functions at
the request of the Company. If the Committee member is pursuing
Committee functions at the request of the Union, the Union will
reimburse the Company for the pay and benefits of the Committee
member. A Professional Standards Committee member performing
professional standards duties on a scheduled duty free Day will not
be entitled to compensation. Expenses incurred by a Professional
Standards Committee member while acting on behalf of the Committee
will be paid by the Union.
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SECTION 29 - MISSING, INTERNMENT, PRISONER OR HOSTAGE OF WAR AND
HIJACKING
29.1. COMPENSATION
A Crewmember who, in the course of his employment, becomes
involuntarily missing, is interned or held hostage will be paid his
MBPG. Payments will continue until released or, if missing, until
proof of death is established in fact, or until there is reasonable
presumption of death, to a maximum of thirty-six (36) Months. The
MBPG will be paid to the beneficiary or beneficiaries designated in
writing by the Crewmember as set forth in subsection 29.5.
29.2. SENIORITY AND LONGEVITY ACCRUAL
A Crewmember will accrue seniority and longevity during a period in
which he is involuntarily missing or interned.
29.3. SICK LEAVE USE
A Crewmember who requires the use of sick leave as a result of hijack
or terrorist activity that occurs in the course of his employment
will be allowed to use sick leave with no charge to the Crewmember's
sick leave account for a period not to exceed one hundred eighty
(180) Days.
29.4. DIRECTION OF PAYMENTS
29.4.1. WRITTEN DIRECTION
The MBPG will be disbursed by the Company in accordance with
written direction from the Crewmember. The Company will
require each Crewmember to execute and deliver to the
Company such written direction.
29.4.2. NO WRITTEN DIRECTION
Any payments due a Crewmember under this Section which are
not covered by a written direction will be held by the
Company for such Crewmember and in the event of his death
will be paid to the legal representative of his estate.
29.5. FORM FOR PAYMENT DIRECTION
The direction will be in substantially the following form:
TO: Kitty Hawk International, Inc.
You are hereby directed to pay all compensation due me under the
terms of the Collective Bargaining Agreement between Kitty Hawk
International, Inc. and the International Brotherhood of
Teamsters, Airline Division, while missing, or resulting from
death or any other condition that makes direct payment to me
impossible under the Agreement, as follows:
$__________ per month to _________________________________
____________________________________________ as long as living,
and thereafter to ________________________________________
_____________________________________________as long as living.
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The balance, if any, and any amounts accrued after the death of
all persons named in the above designation will be held for me,
or in the event of my death before receipt thereof, will be paid
to the legal representative of my estate.
This direction may be modified from time to time by letter
signed by the undersigned, and any such modification will become
effective upon receipt of such letter by the Company.
Payments made by the Company pursuant to this direction will
fully relieve the Company from the obligation of making payment
with respect thereto.
----------------------- --------------------
Crewmember Name (Print) Witness Name (Print)
----------------------- --------------------
Signature Signature
------------ ------------
Date Date
SECTION 30 - STRIKES, LOCKOUTS AND PICKET LINES
30.1. STRIKE
During the term of this Agreement, the Union will not authorize,
cause, sanction or engage in any strike, non-informational picketing,
slowdown, or work stoppage.
30.2. LOCKOUT
During the term of this Agreement, the Company will not cause,
permit, or engage in any lockout of Crewmembers.
30.3. PICKET LINE
The Union and the Company will consult prior to the Company
conducting any flight operations behind a picket line on behalf of an
air carrier involved in an AFL-CIO sanctioned labor dispute.
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SECTION 31 - GENERAL
31.1. NO DISCRIMINATION
In accordance with applicable law, there will be no discrimination by
either party against any Crewmember covered by this Agreement because
of race, color, religion, sex, national origin, age, veteran status
or disability.
31.2. GENDER NEUTRAL
Wherever a Crewmember is referred to in this Agreement in the
masculine, it is understood to include the feminine.
31.3. INVALIDATION OF AGREEMENT PROVISIONS
If any provision of this Agreement is held invalid by operation of
law or by any court of competent jurisdiction, or if compliance with
or enforcement of any provision should be restrained by such court
pending a final determination as to its validity, the remainder of
this Agreement, or the application of such to persons or
circumstances other than those as to which it has been held invalid
or as to which compliance with or enforcement of has been restrained,
will not be affected. If any provision is held invalid, either party
may request negotiations for the purpose of arriving at a mutually
satisfactory replacement of such provision. If such negotiations fail
to produce an agreement as to such replacement, either party,
notwithstanding the provisions of Section 32, may invoke the services
of the National Mediation Board in accordance with Section 6, Title
1, of the Railway Labor Act, as amended, to resolve such dispute.
31.4. MODIFICATIONS TO THE AGREEMENT
Any modification to this Agreement must be in writing, signed by a
representative of the Union, a representative of the Executive
Council, and two (2) representatives of the Company, one of whom must
be the Director of Operations or his superior.
31.5. ID CARDS
The Company will provide identification cards to each Crewmember
indicating his Crew Class.
31.6. CHARTS AND MANUALS
The Company will provide current charts and manuals for each
aircraft. A Crewmember will not be required to update or maintain
manuals, documents or charts during flight.
31.7. VISAS AND INOCULATIONS
The Company will pay for visas, visa photographs and inoculations
required of Crewmembers and, if practicable, the Company will obtain
such visas.
31.8. USE AND DAMAGE OF COMPANY EQUIPMENT
A Crewmember will not be required to pay for the use of any Company
equipment used in Training and will not be required to pay for any
Company aircraft damaged while under the direction of the Company
unless such damage occurs as a result of the gross negligence of the
Crewmember.
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31.9. CREWMEMBER LIABILITY COVERAGE
The Company will include each Crewmember as an insured under the
Company's Airline Liability Policy while the Crewmember is performing
duty at the direction of the Company.
31.10. PERSONNEL FILES
31.10.1. CONTENTS
The Company will maintain a personnel file for each
Crewmember. The personnel file will contain all
personnel-related documents involving the Crewmember. All
orders to a Crewmember involving promotions, demotions,
furloughs and leaves of absences will be stated in writing,
and will be placed in the Crewmember's personnel file.
31.10.2. ACCESS
Upon written request, a Crewmember may review his personnel
file in the presence of an appropriate Company
representative at a time and place mutually agreed upon
between the Crewmember and the Company and will be entitled
to copies of any document(s) in his personnel file. Such
request(s) will be limited to one (1) every six (6) Months.
31.11. UNION REPRESENTATION
31.11.1. BULLETIN BOARD
The Company will provide the Union with a suitable location
for a bulletin board at all Base(s) for the posting of
official notices of Union meetings, elections, and other
notices pertaining to internal Union matters. The bulletin
board will not contain any inflammatory material or material
derogatory to the Company or any of its employees.
31.11.2. UNION ACCESS TO PROPERTY
The Company will admit to its Base(s) and operational line
stations, the official designated representatives of the
Union to transact such business as is necessary for the
administration of this Agreement. The Union will provide the
Company with prior notice of a request to be admitted to any
operational line station. All such requests must be approved
by the Company.
31.11.3. CREWMEMBER REPRESENTATIVES
The Union will select Crewmember representatives and notify
the Company of their appointment or removal. The number of
representatives will be limited to those necessary to
provide convenient representation for Crewmembers. The
Company will notify the Union of the appropriate Company
representatives.
31.11.4. NEW-HIRE INDOCTRINATION
The Company will inform the Union of any scheduled new-hire
Crewmember classes and allow a reasonable period of time
during new hire indoctrination for Union orientation.
31.12. MANAGEMENT POSITIONS, CHECK AIRMEN AND SPECIAL PROJECTS
A Crewmember will not be required to accept a management or Check
Airman position nor be required to perform special projects for the
Company.
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31.13. PROMOTIONAL ACTIVITIES
A Crewmember will not be required to participate in publicity or
promotional activities.
31.14. HOSTILE AREAS
A Crewmember with less than ninety (90) Days of Active Service will
not be required to operate a flight(s) into an area with an ongoing
armed conflict that may affect his personal safety.
31.15. JUMPSEAT AGREEMENTS
The Company will negotiate reciprocal jumpseat agreements with other
airlines and provide a list to each Crewmember.
31.16. INTERLINE AGREEMENTS
Consistent with the Company's pass policy and interline agreements
with other airlines, a Crewmember and his immediate family will be
entitled to the same pass or reduced fare privileges afforded other
groups of non-managerial Company employees and their families. The
Company will provide a current list of all agreements and interline
privileges to each Crewmember once each year.
31.17. CABIN AND FLIGHT DECK MAINTENANCE
Aircraft cabin entry area and flight decks will be cleaned regularly
and properly maintained. All aircraft will have a clean and
serviceable toilet. All cockpit seats will be fully functional and
clean with all seat covers and cushions in good condition. A
Crewmember must assure that such areas are left in a clean and
orderly condition. The Company will provide all appropriate cleaning
supplies and approved wipes for oxygen mask equipment.
31.18. AIRCRAFT GALLEY EQUIPMENT
When feasible at a reasonable cost, all Company aircraft will have a
hot cup and a microwave or galley oven installed. Such galley
equipment will be maintained in operational condition. Each aircraft
will have a cooler stocked with water and ice for each flight.
31.19. CREW MEALS
If a Crewmember is scheduled for eight (8) or more hours of duty and
is not scheduled for an en route stop of at least three (3) hours
where ground transportation to a restaurant is provided, the Company
will provide crew meals. Crew meals will also be provided on Flight
Segments of six (6) hours or more, Block to Block. When at an airport
where catering is available, crew meals will be delivered directly to
the aircraft not more than two (2) hours prior to actual departure. A
flight will not be delayed because of the failure to provide a crew
meal. If the Company fails to provide crew meals, the Captain may,
upon obtaining approval from the Company, which approval will not be
unreasonably withheld, purchase crew meals with Company funds not to
exceed reasonable and customary charges. A Crewmember will not be
required to provide his own crew meal when the Company is required to
provide such a meal.
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SECTION 32 - DURATION
Except as otherwise provided herein, this Agreement will become effective on
October 30, 1999, and will remain in full force and effect until October 30,
2003, and will renew itself without change until each succeeding October 30
thereafter, unless written notice of intended change is served in accordance
with Section 6, Title I of the Railway Labor Act, as amended, by either party at
least sixty (60) days prior to October 30, 2003 or any October 30 thereafter.
The parties agree to commence negotiations pursuant to a Section 6 notice not
later than sixty (60) Days prior to October 30, 2003.
IN WITNESS WHEREOF, the parties have signed this Agreement, this 30th Day of
October, 1999.
KITTY HAWK INTERNATIONAL, FOR INTERNATIONAL BROTHERHOOD
INC.: OF TEAMSTERS, AIRLINE DIVISION:
/s/ CHARLES C. CARSON II /s/ RAY W. BENNING, JR.
- ----------------------------- ---------------------------------
Charles C. Carson II Ray W. Benning, Jr.
President Director, Airline Division
/s/ TIMIOTHY D. KOMBEREC /s/ DONALD R. TREICHLER
- ----------------------------- ---------------------------------
Timothy D. Komberec Donald R. Treichler
Vice President of Operations International Representative,
Airline Division
/s/ ROBERT F. VETTER, JR.
---------------------------------
Robert F. Vetter, Jr.
Chairman, Executive Council and
Negotiating Committee
/s/ BRYANT H. BEEBE
---------------------------------
Bryant H. Beebe
Negotiating Committee
/s/ ROBERT S. WOLFE
---------------------------------
Robert S. Wolfe
Negotiating Committee
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LETTER OF AGREEMENT
BETWEEN
KITTY HAWK INTERNATIONAL, INC.
AND
INTERNATIONAL BROTHERHOOD OF TEAMSTERS,
AIRLINE DIVISION
REGARDING
PRIOR RIGHTS FLIGHT ENGINEERS
THIS LETTER OF AGREEMENT is made and entered into in accordance with the
provisions of the Railway Labor Act, as amended, by and between Kitty Hawk
International, Inc. (the "Company") and The International Brotherhood of
Teamsters, Airline Division (the "Union"), hereinafter known as the "Parties".
The Parties agree as follows:
1. All Flight Engineers in the employ of the Company on the date of the signing
of this Agreement listed on the Flight Engineer's Seniority List appended hereto
are recognized as being Prior Rights Flight Engineers. Designation as a Prior
Rights Flight Engineer will continue until a Prior Rights Flight Engineer is no
longer employed by the Company as a Flight Engineer.
2. No Prior Rights Flight Engineer will be furloughed until all other Flight
Engineers are furloughed. No Prior Rights Flight Engineer will be furloughed as
a result of any Pilot being displaced. A Prior Rights Flight Engineer who is
furloughed will retain Prior Rights Flight Engineer status upon recall.
3. This Letter of Agreement will survive the duration of the Agreement between
the Parties dated October 30, 1999, and all succeeding Agreements so long as any
Prior Rights Flight Engineer is employed by the Company as a Flight Engineer.
The Parties to this Letter of Agreement and this Agreement irrevocably waive the
right to serve any notice under Section 6 of the Railway Labor Act of any
intended change to the Agreement that, if adopted, would modify any terms of
this Letter of Agreement.
IN WITNESS WHEREOF, the Parties have signed this Letter of Agreement this 30th
Day of October, 1999.
For Kitty Hawk International, Inc.: For The International Brotherhood of
Teamsters, Airline Division:
/s/ CHARLES C. CARSON II /s/ DONALD R. TREICHLER
- ------------------------- --------------------------------
Charles C. Carson II Donald R. Treichler
President International Representative,
Airline Division
/s/ TIMOTHY D. KOMBEREC /s/ ROBERT F. VETTER, JR.
- ------------------------- --------------------------------
Timothy D. Komberec Robert F. Vetter, Jr.
Vice President of Operations Chairman, Executive Council
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ATTACH FLIGHT ENGINEER
SENIORITY LIST
AS OF SIGNING DATE
(PRIOR RIGHTS ENGINEERS AS OF OCT 30, 1999.XLS)
HERE
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ATTACH FLIGHT ENGINEER
SENIORITY LIST
AS OF SIGNING DATE
(PRIOR RIGHTS ENGINEERS AS OF OCT 30, 1999.XLS)
HERE
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LETTER OF AGREEMENT
BETWEEN
KITTY HAWK INTERNATIONAL, INC.
AND
INTERNATIONAL BROTHERHOOD OF TEAMSTERS,
AIRLINE DIVISION
REGARDING
HIGH LONGEVITY DC-8 CREWMEMBERS
This Letter of Agreement is made and entered into in accordance with the
provisions of the Railway Labor Act, as amended, by and between Kitty Hawk
International, Inc. (the "Company") and The International Brotherhood of
Teamsters, Airline Division (the "Union"), hereinafter known as the "Parties".
The Parties agree as follows:
1. The Parties recognize that there are DC-8 Crewmembers with nine (9) years or
more of Active Service and that those Crewmembers should be afforded time in
which to evaluate their best available option and exercise their seniority to
either bid an available vacancy on another Type, Displace to another Type if
Displacements occur on the DC-8 in 2000 or remain on the DC-8.
2. All DC-8 Crewmembers with nine (9) years or more of Active Service during
2000 will be paid at the pay rates set forth in Section 5 of this Agreement
without regard to the longevity increase cap above the ninth (9th) year of
Active Service.
3. Effective January 1, 2001, DC-8 Crewmembers with nine (9) or more years of
Active Service will be returned to the pay rate set forth in Section 5 of this
Agreement. Thereafter, those Crewmembers will not receive longevity increases.
IN WITNESS WHEREOF, the Parties have signed this Letter of Agreement this 30th
Day of October, 1999.
For Kitty Hawk International, Inc.: For The International Brotherhood of
Teamsters, Airline Division:
/s/ CHARLES C. CARSON II /s/ DONALD R. TREICHLER
- -------------------------- -----------------------------------
Charles C. Carson II Donald R. Treichler
President International Representative,
Airline Division
/s/ TIMOTHY D. KOMBEREC /s/ ROBERT F. VETTER, JR.
- -------------------------- -----------------------------------
Timothy D. Komberec Robert F. Vetter, Jr.
Vice President of Operations Chairman, Executive Council
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KITTY HAWK, INC.
(LETTERHEAD)
OCTOBER 30, 1999
To: Mr. Donald R. Treichler
International Representative,
International Brotherhood of Teamsters, Airline Division
Mr. Robert F. Vetter, Jr.
Chairman,
Executive Council
1. Except as provided in Section 1 of the Agreement between Kitty Hawk
International, Inc. and the International Brotherhood of Teamsters (the
"Agreement") and in paragraph 2, below, Kitty Hawk, Inc. agrees that all revenue
flying in widebody aircraft and aircraft having an FAA certificated gross
takeoff weight of 300,000 pounds or greater that are listed by tail number on
the Operations Specifications issued by the FAA for Kitty Hawk, Inc., any
subsidiary of Kitty Hawk, Inc. or any subsidiary of Kitty Hawk International,
Inc. will be performed by Crewmembers on the Kitty Hawk International, Inc.
seniority lists.
2. It is understood that the purpose of this letter is not to prevent or hinder
any potential merger or acquisition of another airline that may operate widebody
aircraft and aircraft having an FAA certificated gross takeoff weight of 300,000
pounds or greater. If such a merger or acquisition occurs, it would be
considered to affect the seniority rights of Crewmembers at Kitty hawk
International, Inc. and the procedures set forth in Section 1.6.2. of the
Agreement will be followed.
3. This letter will be effective concurrently with the Agreement and, in any
event, only so long as Kitty Hawk International, Inc. is owned by Kitty Hawk,
Inc.
Kitty Hawk, Inc. Agreed:
By: /s/ DONALD R. TREICHLER
-----------------------------
Donald R. Treichler
International Representative,
/s/ M. TOM CHRISTOPHER Airline Division
- -----------------------------
(Officer of Kitty Hawk, Inc.)
/s/ ROBERT F. VETTER, JR.
-----------------------------
Robert F. Vetter, Jr.
Chairman, Executive Council
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INDEX
PREAMBLE
SECTION 1 - RECOGNITION, PURPOSE, SCOPE AND MERGERS
1.1. RECOGNITION
1.2. PURPOSE OF AGREEMENT
1.3. SOLE AGREEMENT
1.4. SCOPE
1.4.1. FLYING PERFORMED BY CREWMEMBERS
1.4.2. CREWMEMBERS TEMPORARILY ASSIGNED OUT OF SENIORITY
1.4.2.1. INTRODUCTION OF NEW AIRCRAFT
1.4.2.2. INTRODUCTION OF ADDITIONAL AIRCRAFT
1.4.2.3. SHORT TERM FLYING REQUIREMENTS
1.4.2.4 TRAINING OF CREWMEMBERS
1.4.2.5. EXPIRATION OF TIME LIMITS
1.4.2.6. PAY PROTECTION
1.4.2.7. NO REDUCTIONS
1.4.3. WET LEASE IN
1.4.3.1. UNION NOTIFICATION
1.4.3.2. NO REDUCTIONS
1.4.3.3. DURATION OF WET LEASE
1.5. SALE OR DRY LEASE OF COMPANY AIRCRAFT
1.6. MERGERS AND ACQUISITIONS
1.6.1. NOTICE OF MERGER OR ACQUISITION
1.6.2. INTEGRATION OF SENIORITY LISTS
1.6.2.1. NEGOTIATIONS
1.6.2.2. ARBITRATION
1.6.2.3. FENCE AGREEMENT
1.6.2.4. NO SYSTEM FLUSH
1.6.3. REPRESENTATION
1.7. ALTER EGO
1.8. TRANSFER OF ASSETS
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1.9. SUCCESSORSHIP AND ASSUMPTION OF AGREEMENT
1.10 FOREIGN BASES
SECTION 2 - DEFINITIONS
"ACTIVE SERVICE"
"ADEQUATE REST FACILITY"
"ALOFT"
"BASE"
"BID LINE"
"BID SENIORITY LIST"
"BLOCK TO BLOCK
"CAPTAIN"
"CATEGORY"
"COMMUTE"
"COMPOSITE LINE"
"CREW CLASS"
"CREWMEMBER"
"CURTAILMENT"
"DATE OF HIRE"
"DAY"
"DEADHEAD"
"DISPLACEMENT"
"DOMESTIC"
"DRY LEASE"
"DUTY DAY"
"DUTY TIME"
"EFFECTIVE DATE"
"FAR"
"FIRST OFFICER"
"FLIGHT ENGINEER"
"FLIGHT PAY"
"FLIGHT SEGMENT"
"FLIGHT TIME"
"INTERNATIONAL"
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"LINE OF FLYING"
"MANAGEMENT CREWMEMBER"
"MINIMUM BID PERIOD GUARANTEE (MBPG)"
"MONTH"
"OPEN TIME"
"PILOT"
"POSITIONING OR DE-POSITIONING"
"PRIOR RIGHTS FLIGHT ENGINEER"
"PROFESSIONAL FLIGHT ENGINEER"
"RECURRENT TRAINING"
"RESERVE CREWMEMBER"
"RESERVE LINE"
"RESIDENCE AIRPORT"
"SECOND OFFICER"
"SENIORITY LIST(S)"
"STANDING BID"
"TRAINING"
"TRIP SEQUENCE"
"TYPE"
"WET LEASE"
SECTION 3 - UNION SECURITY
3.1. UNION MEMBERSHIP
3.2. INITIATION FEES AND DUES OR SERVICE FEES AND ASSESSMENTS DEDUCTION
3.2.1. TRANSFER OF DUES OR SERVICE FEES TO UNION
3.2.2. INDEMNIFICATION CLAUSE
3.2.3. DUES OR SERVICE FEES AND ASSESSMENTS AFTER TERMINATION
3.2.4. DEDUCTION ERROR
3.3. FAILURE TO PAY DUES OR SERVICE FEES AND ASSESSMENTS
3.4. CREWMEMBER LIST
SECTION 4 - MANAGEMENT RIGHTS
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SECTION 5 - COMPENSATION
5.1. NEW-HIRE PAY
5.2. FLIGHT PAY RATES
5.2.1. CAPTAINS
5.2.2. PROFESSIONAL FLIGHT ENGINEERS
5.2.3. FIRST OFFICERS
5.2.4. SECOND OFFICERS
5.3. FLIGHT PAY COMPUTATION
5.3.1. FLIGHT PAY
5.4. CHECK AIRMAN OVERRIDE
5.5. INSTRUCTOR PAY
5.5.1. GROUND SCHOOL INSTRUCTION
5.5.2. SIMULATOR INSTRUCTION
5.6. REPORT PAY
5.7. MINIMUM PAY CREDIT
5.8. TAXI PAY
5.8.1. REPORT FOR TAXI ONLY
5.8.2. WITHIN A DUTY PERIOD
5.9. PAY ON A SCHEDULED DUTY FREE DAY
5.9.1. DAYS OFF
5.9.2. JUNIOR ASSIGNMENT
5.10. DEADHEAD PAY
5.11. TRAINING PAY
5.11.1. RECURRENT AND ADDITIONAL REQUIREMENT TRAINING
5.11.1.1. SCHEDULED DUTY DAYS
5.11.1.2. SCHEDULED DUTY FREE DAYS
5.11.2. INITIAL, TRANSITION AND UPGRADE
5.11.3. PILOT TO FLIGHT ENGINEER TRANSITIONS
5.11.4. REMEDIAL TRAINING
5.12. MAINTENANCE PAY
5.13. MINIMUM BID PERIOD GUARANTEE (MBPG)
5.14. BONUS INCENTIVE PLAN
5.15. GENERAL
5.15.1. PAYROLL SCHEDULE
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5.15.2. PAYCHECK DELIVERY AND DEPOSIT
5.15.3. JURY DUTY
5.15.4. SPECIAL PROJECTS
SECTION 6 - EXPENSES, LODGING AND TRANSPORTATION
6.1. PER DIEM
6.1.1. DOMESTIC
6.1.2. INTERNATIONAL
6.1.3. NEW HIRE TRAINING
6.1.4. PAYMENT
6.2. LODGING
6.2.1. NEW HIRE TRAINING
6.3. LOCAL TRANSPORTATION
6.4. RENTAL CAR
6.5. PERSONAL VEHICLE
SECTION 7 - MOVING EXPENSES
7.1. ELIGIBILITY
7.1.1. NEW BASE AWARD
7.1.2. INVOLUNTARY BASE ASSIGNMENT
7.1.3. BASE DISPLACEMENT
7.1.4. RECALL TO A DIFFERENT BASE
7.2. COORDINATION WITH COMPANY
7.3. MOVING EXPENSES
7.3.1. PERSONAL
7.3.2. VEHICLES
7.3.3. MOBILE HOMES
7.4. ACCOMMODATIONS IN LIEU OF MOVING EXPENSES
7.5. NEW-HIRE CREWMEMBERS
SECTION 8 - SICK LEAVE
8.1. ACCRUAL
8.2. SICK LEAVE PAY
8.2.1. BANK DEBIT
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8.2.2. SCHEDULED DUTY DAYS
8.3. SICK LEAVE USAGE
8.3.1. CREW SCHEDULING CONTACT
8.3.2. EXCLUSIONS
8.3.3. WORKER'S COMPENSATION
8.4. SICK LEAVE BANK REPLENISHMENT
8.5. DISABILITY
8.6. PHYSICIAN'S STATEMENTS
8.7. VACATION CONCURRENT WITH ILLNESS
8.8. RETIREMENT
8.9. GENERAL
8.9.1. RECALL
8.9.2. STATEMENTS
8.9.3. OUTSIDE WORK
8.9.4. SENIORITY AND LONGEVITY
8.9.5. RESUMPTION OF DUTY
SECTION 9 - VACATION
9.1. ACCRUAL
9.2. VACATION PAY
9.3. DUTY
9.3.1. NO DUTY
9.3.1. DUTY FREE DAYS
9.4. ANNUAL VACATION BID
9.4.1. PROCEDURE
9.4.2. PROBATIONARY CREWMEMBER
9.4.3. FAILURE TO BID
9.5. VACATION OPTIONS
9.6. VACATION SPLITS
9.7. UNSCHEDULED VACATION
9.8. VACATION RESCHEDULING
9.8.1. RESCHEDULE
9.8.2. RELINQUISH
9.8.3. CHANGE OF CREWMEMBER STATUS
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9.8.4. VACATION SLIDE
9.9. VACATION BANK
9.9.1. MAXIMUM BANK
9.9.2. PAY OUT
9.9.2.1. EXCESS BANK
9.9.2.2. CESSATION OF EMPLOYMENT
9.9.2.3. SUPPLEMENT TO SICK LEAVE OR DISABILITY BENEFITS
9.10. GENERAL
9.10.1. VACATION DAY
9.10.2. STATEMENTS
SECTION 10 - HEALTH AND WELFARE
10.1. LIFE INSURANCE
10.1.1. ADDITIONAL LIFE INSURANCE
10.2. ACCIDENTAL DEATH AND DISMEMBERMENT INSURANCE
10.3. HEALTH AND DENTAL INSURANCE
10.3.1. COBRA
10.3.2. LEAVES OF ABSENCE
10.3.3. PREMIUMS FOR HEALTH AND DENTAL INSURANCE
10.3.4. CONTINUATION OF HEALTH AND DENTAL INSURANCE AFTER RETIREMENT
10.4. SHORT-TERM DISABILITY INSURANCE
10.5. LONG-TERM DISABILITY INSURANCE
10.6. ILLNESS OR INJURY WHILE IN THE SERVICE OF THE COMPANY
10.6.1. MEDICAL CARE AWAY FROM BASE
10.6.2. TRANSPORTATION
10.6.3. WORKER'S COMPENSATION FILING PROCEDURE
SECTION 11 - RETIREMENT
11.1. TAX DEFERRED SAVINGS PLAN
11.2. COMPANY CONTRIBUTIONS
11.3. VESTING SCHEDULE
11.4. PAYROLL DEDUCTIONS
11.5. CREWMEMBER FUNDS IN PRE-EXISTING COMPANY 401(k) PLAN
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SECTION 12 - UNIFORMS
12.1. INITIAL UNIFORMS
12.2. MAINTENANCE ALLOWANCE
12.3. REPLACEMENT OF DAMAGED ITEMS
12.4. COMPANY INSIGNIA
12.5. UNION INSIGNIA
12.6. CHANGES IN UNIFORM
SECTION 13 - PHYSICAL EXAMINATIONS
13.1. COMPANY STANDARDS
13.2. CONFIDENTIALITY
13.3. FAA PHYSICAL EXAMINATIONS
13.3.1. CERTIFICATES TO TRAINING DEPARTMENT
13.3.2. SCHEDULING OF FAA PHYSICAL
13.3.3. INABILITY TO MAINTAIN A FIRST CLASS MEDICAL CERTIFICATE
13.4. REIMBURSEMENT FOR A PHYSICAL EXAMINATION
13.5. FAA DRUG AND ALCOHOL TESTING PROGRAMS
13.5.1. PROGRAM ADMINISTRATION AND DESCRIPTION
13.5.2. REIMBURSEMENT OF EXPENSES
13.5.3. DRUG TESTING ON A SCHEDULED DUTY FREE DAY
SECTION 14 - LEAVES OF ABSENCE
14.1. PERSONAL LEAVE
14.1.1. REQUESTS
14.1.2. SENIORITY AND LONGEVITY ACCRUAL
14.1.3. EXTENSIONS
14.2. MILITARY LEAVE
14.3. UNION LEAVE
14.4. MEDICAL LEAVE
14.5. FUNERAL LEAVE
14.5.1. DURATION
14.5.2. IMMEDIATE FAMILY
14.5.3. VACATION
14.5.4. SCHEDULED DUTY FREE DAYS
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14.6. FAMILY AND MEDICAL LEAVE ACT (FMLA)
14.6.1. FMLA
14.6.2. SENIORITY AND LONGEVITY ACCRUAL
14.7. MANAGEMENT CREWMEMBER LEAVE
14.7.1. SENIORITY AND LONGEVITY ACCRUAL
14.7.2. EXCLUSION FROM THE AGREEMENT
14.7.3. MAXIMUM NUMBER
14.7.4. 401(K) PLAN
14.7.5. DUES EXEMPTION
14.7.6. FLYING RESTRICTION
14.8. GENERAL
14.8.1. OTHER EMPLOYMENT
14.8.2. RETURN FROM LEAVE
14.8.3. PAY DURING REQUALIFICATION
SECTION 15 - SENIORITY
15.1. SENIORITY GOVERNS
15.2. SENIORITY LISTS
15.2.1. SEPARATE LISTS
15.2.2. LIST CONTENTS
15.3. SENIORITY ACCRUAL
15.4. SENIORITY LIST CONTENT AND PUBLISHING
15.4.1. CONTENT
15.4.2. POSTING
15.5. PROTESTS
15.6. LOSS OF SENIORITY
15.7. EFFECT OF BYPASS ON SENIORITY
15.8. LONGEVITY
15.9. PROBATION
15.10. FLIGHT ENGINEER TO PILOT BIDDING
15.10.1. MINIMUM REQUIREMENTS
15.10.2. TRAINING AVAILABILITY
15.10.3. FAILURE TO QUALIFY
15.10.4. REMOVAL FROM SENIORITY LIST
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15.11. PILOT TO FLIGHT ENGINEER BIDDING
15.11.1. BID SUBMISSION DEADLINE
15.11.2. MINIMUM REQUIREMENTS
15.11.3. BID TO PROFESSIONAL FLIGHT ENGINEER
15.11.4. BID TO SECOND OFFICER
15.11.5. HOLDING A BID ON FILE
15.11.6. TRAINING AVAILABILITY
15.11.7. REMOVAL FROM SENIORITY LIST
15.11.8. FAILURE TO QUALIFY
15.11.9. DISPLACEMENT TO FLIGHT ENGINEER
SECTION 16 - FILLING OF VACANCIES
16.1. VACANCY DEFINITION
16.2. STANDING BID
16.2.1. STANDING BID DEFINITION
16.2.2. STANDING BID UPDATES
16.3. VACANCY FILLING
16.3.1. VACANCY NOTICE
16.3.2. VACANCY CLOSING AND BID SUBMISSION
16.3.3. BID AWARD
16.3.4. ADDITIONAL VACANCIES
16.3.5. UNFILLED VACANCIES
16.3.6. PUBLISHING OF BID RESULTS
16.4. EQUIPMENT LOCK
16.4.1. NEW EQUIPMENT TYPE
16.5. BYPASS
16.5.1. UPGRADE TO CAPTAIN
16.5.2. TRANSITION
SECTION 17 - BASES
17.1. UNION CONSULTATION
17.2. INTERNATIONAL BASES
17.3. DOMESTIC BASES
17.3.1. MINIMUM STAFFING LEVEL
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17.3.2. STAFFING LEVEL CHANGES
17.3.3.2. INCREASED STAFFING
17.3.3.3. DECREASED STAFFING
17.3.3.4. NO MOVING EXPENSES
17.3.3. THIRTY-FIVE (35) MILE RULE
17.3.3.1. PER DIEM IN BASE
17.3.3.2. LODGING IN BASE
17.4. TEMPORARY BASES
SECTION 18 - CURTAILMENT, DISPLACEMENT, FURLOUGH AND RECALL
18.2. CURTAILMENT
18.2.1. CURTAILMENT PROCEDURE
18.2. DISPLACEMENT
18.2.1. DISPLACEMENT PROCEDURE
18.3. FURLOUGH
18.3.1. VOLUNTARY FURLOUGH
18.3.2. NOTICE OF FURLOUGH
18.3.3. RETENTION OF SENIORITY
18.3.4. CHANGE IN ADDRESS OR TELEPHONE NUMBER
18.3.5. STANDING BID
18.3.6. FURLOUGH EXPIRATION
18.4. RECALL
18.4.1. CATEGORY SENIORITY ORDER
18.4.2. BYPASS OF RECALL
18.4.3. RECALL NOTICE
18.4.4. WAIVER OF RECALL NOTICE
18.4.5. FAILURE TO RESPOND OR REPORT
18.4.6. MINIMUM RECALL DURATION
18.4.7. NEW-HIRE FLYING EXCLUSION
18.4.8. PAY WHEN RECALLED
SECTION 19 - TRAINING
19.1. QUALIFICATIONS
19.1.1. FAA REQUIREMENTS
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19.1.2. COMPANY MINIMUM REQUIREMENTS
19.1.2.1. FIRST OFFICER MINIMUM REQUIREMENTS:
19.1.2.1.1. CERTIFICATES
19.1.2.1.2. FLYING EXPERIENCE
19.1.2.1.3. MEDICAL CERTIFICATE
19.1.2.1.4. SIMULATOR EVALUATION
19.1.2.1.5. WRITTEN EXAMINATION
19.1.2.1.6. FLIGHT ENGINEER UPGRADES
19.1.2.2. SECOND OFFICER MINIMUM REQUIREMENTS:
19.1.2.2.1. CERTIFICATES
19.1.2.2.2. FLYING EXPERIENCE
19.1.2.2.3. MEDICAL CERTIFICATE
19.1.2.2.4. WRITTEN EXAMINATION
19.1.2.3. PROFESSIONAL FLIGHT ENGINEER MINIMUM REQUIREMENTS:
19.1.2.3.1. CERTIFICATES
19.1.2.3.2. MEDICAL CERTIFICATE
19.1.2.3.3. COMPANY EMPLOYEES
19.1.2.4. CAPTAIN MINIMUM REQUIREMENTS:
19.1.2.4.1. CERTIFICATES
19.1.2.4.2. FLYING EXPERIENCE
19.1.2.4.3. MEDICAL CERTIFICATE
19.1.2.4.4. FIRST OFFICER UPGRADES
19.2. COMPANY-PROVIDED TRAINING
19.3. TRAINING RECORDS REVIEW
19.4. NOTICE OF TRAINING
19.5. TRAINING SCHEDULES
19.5.1. RECURRENT GROUND SCHOOL
19.5.2. RECURRENT SIMULATOR TRAINING
19.5.3. ONE-IN-SEVEN
19.5.4. MINIMUM SCHEDULED DAYS FREE OF DUTY
19.5.5. REST BEFORE SIMULATOR
19.5.6. SIMULATOR PERIOD DURATION
19.6. INITIAL, UPGRADE AND TRANSITION TRAINING FAILURES
19.6.1. FIRST TRAINING FAILURE
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19.6.2. INELIGIBILITY TO BID AFTER FAILURES
19.6.3. SECOND TRAINING FAILURE
19.6.4. FAILURE TO MEET TRAINING TIME LINES
19.6.5. FAILURE TO PASS PRE-TRAINING EVALUATIONS
19.7. RECURRENT TRAINING FAILURES
19.7.1. FIRST FAILURE
19.7.2. SECOND FAILURE
19.8. PROFESSIONAL STANDARDS COMMITTEE INVOLVEMENT
19.8.1. TRAINING FAILURES
19.8.2. COMMITTEE MEMBER PAY PROTECTION
19.9. TRAINING PAY
19.10. GENERAL
19.10.1. REVENUE FLYING
19.10.2. PROBATIONARY CREWMEMBERS
19.10.3. RECURRENT TRAINING ORDER
19.10.4. RE-INDEXING
19.10.5. GROUND TRANSPORTATION
SECTION 20 - SCHEDULING
20.1. BID PERIOD
20.1.1. MULTIPLE BID PERIODS AWARDED SEPARATELY
20.1.2. MULTIPLE BID PERIODS AWARDED CONCURRENTLY
20.2. BID LINE CONSTRUCTION
20.2.1. LINES OF FLYING, COMPOSITE LINES AND RESERVE LINES
20.2.2. SCHEDULED DUTY FREE DAYS
20.2.2.1. MINIMUM SCHEDULED DUTY FREE DAYS
20.2.2.2. INVIOLATE SCHEDULED DUTY FREE DAYS
20.2.2.3. MINIMUM CONSECUTIVE SCHEDULED DUTY FREE DAYS
20.2.2.4. CONTACT ON SCHEDULED DUTY FREE DAYS
20.3. BID PROCEDURES
20.3.1. ELIGIBILITY TO BID
20.3.2. BID PACKAGE CONTENTS
20.3.3. BID PACKAGE DISTRIBUTION
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20.3.4. BID SUBMISSION
20.3.5. BID AWARD SCHEDULE
20.3.5.1. COMPOSITE LINE CONSTRUCTION
20.3.5.2. RESERVE STATUS CHANGE
20.3.6. BID PERIOD TRANSITION
20.3.6.1. SCHEDULE CONFLICTS
20.3.6.2. EXCESS DAYS
20.3.7. BID AWARDS
20.3.8. FAILURE TO BID
20.4. OPEN TIME
20.4.1. OPEN TIME AWARD AND ASSIGNMENT
20.4.1.1. DEDICATED RESERVE
20.4.1.2. TRAINING
20.4.1.3. SHORTED TIME CREWMEMBER
20.4.1.4. MANAGEMENT CREWMEMBERS
20.4.1.5. VOLUNTEER
20.4.1.6. RESERVE
20.4.1.7. JUNIOR ASSIGNMENT
20.4.1.7.1. MAXIMUM NUMBER OF JUNIOR ASSIGNMENTS
20.4.1.7.2. SCHEDULE CONFLICTS AS A RESULT OF
JUNIOR ASSIGNMENT
20.5. RESCHEDULE AFTER BID AWARD
20.5.1. RESCHEDULE FOR TRAINING
20.5.1.1. RESCHEDULE FOR ANOTHER CREWMEMBER'S TRAINING
20.5.1.2. RESCHEDULE FOR A CREWMEMBER'S OWN TRAINING
20.5.2. RESCHEDULE FOR OTHER THAN TRAINING
20.6. SCHEDULING PROCEDURES
20.6.1. TRIP SEQUENCE TRADES
20.6.2. RESERVE ASSIGNMENTS
20.6.3. RELEASE FROM DUTY
20.6.4. DUTY AT RESIDENCE
20.6.5. PRE-DUTY CHECK IN
20.6.6. POST DUTY CHECK IN
20.7. GENERAL
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20.7.1. SCHEDULING COMMITTEE
20.7.2. MILITARY DUTY
20.7.3. REQUIRED RECORDS
20.7.4. HOSTILE AREAS
20.7.5. NOTIFICATION OF APPRECIABLE DELAY
SECTION 21 - HOURS OF SERVICE
21.1. FAR CONFLICTS
21.2. DUTY TIME
21.2.1. DIRECTION OF THE COMPANY
21.2.2. REPORT AND RELEASE TIMES
21.2.3. REDUCED REPORT TIME
21.2.4. SUSPENSION OF DUTY TIME
21.2.4.1. INVOLUNTARY
21.2.4.2. VOLUNTARY
21.2.5. MAXIMUM DUTY TIMES
21.2.5.1. SINGLE CREW - DOMESTIC
21.2.5.2. AUGMENTED CREW - DOMESTIC
21.2.5.3. DOUBLE CREW - DOMESTIC
21.2.5.4. SINGLE CREW - INTERNATIONAL
21.2.5.5. AUGMENTED CREW - INTERNATIONAL
21.2.5.6. DOUBLE CREW - INTERNATIONAL
21.2.6. DEADHEAD DUTY LIMITATIONS
21.3. REST
21.3.1. REST PERIOD
21.3.2. MINIMUM REST PERIOD - DOMESTIC
21.3.3. MINIMUM REST PERIOD - INTERNATIONAL
21.3.4. FATIGUE
21.3.5. INTERRUPTION OF REST PERIOD
21.3.6. REST AFTER RELEASE
21.4. GENERAL
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21.4.1. MIXING OF DOMESTIC AND INTERNATIONAL FLIGHTS
21.4.2. ONE-IN-SEVEN
21.4.3. AIRCRAFT REST FACILITIES FOR DOUBLE AND AUGMENTED CREWS
SECTION 22 - DEADHEADING AND COMMUTING
22.1. COMMUTING
22.1.2. COMMUTE TO BASE OR ASSIGNMENT
22.1.2. DUTY AND REST
22.2. DEADHEADING
22.2.1. COST OF DEADHEAD
22.2.2. RESPONSIBILITY FOR DELAYS
22.2.3. COMMERCIAL AIR TRANSPORTATION
22.2.4. TRANSPORTATION FOR JUNIOR ASSIGNMENT
22.3. DEADHEAD DUTY CALCULATIONS
22.3.1. SINGLE CREW DEADHEAD TO A DUTY ASSIGNMENT
22.3.2. AUGMENTED AND DOUBLE CREW DEADHEAD TO A DUTY ASSIGNMENT
22.3.3. DEADHEAD BETWEEN DUTY ASSIGNMENTS
22.3.4. DEADHEAD FROM A DUTY ASSIGNMENT
22.3.5. DEADHEAD TO AND FROM TRAINING
22.4. NO COCKPIT DUTY DURING DEADHEAD
22.5. DEADHEAD PAY
22.5.1. AIR TRANSPORTATION
22.5.2. SURFACE TRANSPORTATION
22.5.3. REPORT TO DUTY ASSIGNMENT INSTEAD OF BASE
22.5.4. TRAINING
SECTION 23 - RESERVE
23.1. LONG CALL RESERVE (R - 3)
23.1.1. CONTACT
23.1.2. RESPONSE
23.1.3. COMPENSATION
23.1.4. EXPENSES
23.2. SHORT CALL RESERVE (R - 2)
23.2.1. CONTACT
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23.2.2. RESPONSE
23.2.3. COMPENSATION
23.2.4. EXPENSES
23.2.5. ASSIGNMENT
23.3. STANDBY (R - 1)
23.3.1. CONTACT
23.3.2. RESPONSE
23.3.3. COMPENSATION
23.3.4. EXPENSES
23.3.5. ASSIGNMENT
23.3.6. REST FACILITIES
SECTION 24 - DISCIPLINE AND DISCHARGE
24.1. HOLDING OUT OF SERVICE
24.2. INVESTIGATORY HEARING
24.2.1. EXPENSES
24.3. WRITTEN NOTIFICATION
24.4. GRIEVANCE RIGHTS
SECTION 25 - GRIEVANCE PROCEDURE
25.1. GRIEVANCE DEFINITION
25.2. STEP ONE - REQUEST FOR RELIEF
25.3. STEP TWO - FILING A WRITTEN GRIEVANCE
25.3.1. TIMELINES FOR FILING AND RESPONSE
25.4. STEP THREE - APPEAL TO SYSTEM BOARD OF ADJUSTMENT
25.5. TIMELINE VERIFICATION
25.6. TIME LIMIT EXTENSIONS AND PENALTIES
25.7. PROBATIONARY CREWMEMBER EXCLUSION
25.8. UNION REPRESENTATION
25.9. RECORDING OF SETTLEMENT
SECTION 26 - SYSTEM BOARD OF ADJUSTMENT
26.1. THE BOARD
26.2. COMPOSITION OF THE BOARD
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26.2.1. MEMBER SELECTION
26.2.2. TERMS OF OFFICE FOR BOARD MEMBERS
26.2.3. CHAIRMAN AND VICE CHAIRMAN
26.2.4. TERMS OF OFFICE FOR CHAIRMAN AND VICE CHAIRMAN
26.3. MEETING SCHEDULE
26.4. BOARD MEMBER COMPENSATION
26.5. JURISDICTION OF THE BOARD
26.5.1. LIMITATIONS
26.5.2. REQUIREMENTS
26.6. PROCEEDINGS BEFORE THE BOARD
26.6.1. AGENDA AND SUBMISSIONS
26.6.1.1. ISSUE
26.6.1.2. FACTS
26.6.1.3. GRIEVANT POSITION
26.6.1.4. COMPANY POSITION
26.6.1.5. DOCUMENTATION
26.6.2. ADDITIONAL MEETING DATES
26.6.3. REPRESENTATION
26.6.4. WITNESSES
26.6.5. COMPETENCY
26.7. DEADLOCK PROCEDURES
26.7.1. SUBMISSION TO ARBITRATION
26.7.2. FAILURE TO TIMELY SUBMIT TO ARBITRATION
26.8. FREEDOM TO ACT INDEPENDENTLY
SECTION 27 - ARBITRATION
27.1. THE ARBITRATION PROCEDURE
27.2. STANDING PANEL
27.3. ARBITRATOR SELECTION METHOD
27.4. HEARING DATE AND LOCATION
27.5. EXPENSES
27.6. ARBITRATOR'S COMPENSATION AND EXPENSES
27.7. COURT REPORTER COST
27.8. LIMITATIONS
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27.9. AWARDS
27.10. JURISDICTION
SECTION 28 - PROFESSIONAL STANDARDS COMMITTEE
28.1. COMMITTEE SELECTION
28.2. COMMITTEE PURPOSE
28.3. COMPANY INTERACTION
28.4. REPORTS
28.5. CONFIDENTIALITY
28.6. INVESTIGATIONS
28.7. COMMITTEE MEMBER PAY PROTECTION
SECTION 29 - MISSING, INTERNMENT, PRISONER OR HOSTAGE OF WAR AND HIJACKING
29.1. COMPENSATION
29.2. SENIORITY AND LONGEVITY ACCRUAL
29.3. SICK LEAVE USE
29.4. DIRECTION OF PAYMENTS
29.4.1. WRITTEN DIRECTION
29.4.2. NO WRITTEN DIRECTION
29.5. FORM FOR PAYMENT DIRECTION
SECTION 30 - STRIKES, LOCKOUTS AND PICKET LINES
30.1. STRIKE
30.2. LOCKOUT
30.3. PICKET LINE
SECTION 31 - GENERAL
31.1. NO DISCRIMINATION
31.2. GENDER NEUTRAL
31.3. INVALIDATION OF AGREEMENT PROVISIONS
31.4. MODIFICATIONS TO THE AGREEMENT
31.5. ID CARDS
31.6. CHARTS AND MANUALS
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31.7. VISAS AND INOCULATIONS
31.8. USE AND DAMAGE OF COMPANY EQUIPMENT
31.9. CREWMEMBER LIABILITY COVERAGE
31.10. PERSONNEL FILES
31.10.1. CONTENTS
31.10.2. ACCESS
31.11. UNION REPRESENTATION
31.11.1. BULLETIN BOARD
31.11.2. UNION ACCESS TO PROPERTY
31.11.3. CREWMEMBER REPRESENTATIVES
31.11.4. NEW-HIRE INDOCTRINATION
31.12. MANAGEMENT POSITIONS, CHECK AIRMEN AND SPECIAL PROJECTS
31.13. PROMOTIONAL ACTIVITIES
31.14. HOSTILE AREAS
31.15. JUMPSEAT AGREEMENTS
31.16. INTERLINE AGREEMENTS
31.17. CABIN AND FLIGHT DECK MAINTENANCE
31.18. AIRCRAFT GALLEY EQUIPMENT
31.19. CREW MEALS
SECTION 32 - DURATION
LETTER OF AGREEMENT REGARDING PRIOR RIGHTS FLIGHT ENGINEERS
LETTER OF AGREEMENT REGARDING HIGH LONGEVITY DC-8 CREWMEMBERS
KITTY HAWK, INC. LETTER REGARDING SCOPE
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