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EXHIBIT 99.1
Form of Instructions to Stockholders
INSTRUCTIONS FOR USE OF MIDWAY AIRLINES CORPORATION
SUBSCRIPTION CERTIFICATES
CONSULT THE COMPANY OR YOUR BANK OR BROKER
AS TO ANY QUESTIONS
The following instructions relate to a rights offering (the "Rights
Offering") by Midway Airlines Corporation, a Delaware corporation (the
"Company"), to the holders of its common stock, par value $0.01 per share (the
"Common Stock"), as described in the Company's prospectus dated __________, 2000
(the "Prospectus"). Holders of record of shares of the Common Stock at the
close of business on __________, 2000 (the "Record Date") are receiving one (1)
subscription right (collectively, the "Rights") for each share of the Common
Stock held by them on the Record Date. Each Right is exercisable, upon payment
of $5.20 in cash (the "Subscription Price"), to purchase one share of the Common
Stock (the "Basic Subscription Privilege").
In addition, subject to the limitations described below, each Rights
holder who fully exercises the Basic Subscription Privilege also has the right
to subscribe at the Subscription Price for additional shares of Common Stock
(the "Over-Subscription Privilege"). Only the shares of Common Stock not
subscribed for through the exercise of the Basic Subscription Privilege by the
Expiration Date, as defined below, will be available for purchase pursuant to
the Over-Subscription Privilege (the "Excess Shares"). A Rights holder may only
exercise the Over-Subscription Privilege to purchase up to that number of shares
of Common Stock equal to such Right holder's percentage ownership of the
Company's issued and outstanding Common Stock on the Record Date multiplied by
the number of Excess Shares, rounded down to the nearest whole number.
Nominee holders of Common Stock that hold, on the Record Date, shares
for the account(s) of more than one beneficial owner may exercise the number of
Rights to which all such beneficial owners in the aggregate would otherwise have
been entitled if they had been direct record holders of Common Stock on the
Record Date; provided such nominee holder makes a proper showing to the
Subscription Agent, as determined in the Company's sole and absolute discretion.
The Rights will expire at 5:00 p.m., New York City time, on
__________, 2000, unless such time or date is extended as described in the
Prospectus (the "Expiration Date").
The number of Rights to which you are entitled is printed on the face
of your Subscription Certificate. You should indicate your elections with
regard to the exercise of your Rights by
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completing the appropriate form or forms on your Subscription Certificate and
returning it to the Subscription Agent in the envelope provided.
Your Subscription Certificate must be received by the Subscription
Agent, or guaranteed delivery requirements with respect to your Subscription
Certificate must be complied with, and payment of the Subscription Price,
including final clearance of any checks, must be received by the Subscription
Agent, on or before 5:00 p.m., New York City time, on the Expiration Date. You
may not revoke any exercise of your Rights.
1. Subscription Privilege.
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To exercise Rights, complete Form 1 to the Subscription Certificate
and deliver your properly completed and executed Subscription Certificate,
together with payments in full of the Subscription Price for each share of
Common Stock subscribed for pursuant to the Basic Subscription Privilege and the
Over-Subscription Privilege, to the Subscription Agent.
If you want to exercise your Rights, but time will not permit your
Subscription Certificate to reach the Subscription Agent prior to the Expiration
Date, you may cause a written guarantee substantially in the form enclosed
herewith (the "Notice of Guaranteed Delivery") from a commercial bank, trust
company, securities broker or dealer, credit union, savings association or other
eligible guarantor institution which is a member of or a participant in a
signature guarantee program acceptable to the Subscription Agent (each of the
foregoing being an "Eligible Institution"), to be received by the Subscription
Agent at or prior to the Expiration Date, together with payment in full of the
applicable Subscription Price. Such Notice of Guaranteed Delivery must state
your name, the number of Rights represented by your Subscription Certificate,
the number of Rights being exercised pursuant to the Basic Subscription
Privilege and the number of shares of Common Stock, if any, being subscribed for
pursuant to the Over-Subscription Privilege, and will guarantee the delivery to
the Subscription Agent of your properly completed and executed Subscription
Certificate within three Nasdaq National Market trading days following the date
of the Notice of Guaranteed Delivery. If this procedure is followed, your
Subscription Certificate must be received by the Subscription Agent within three
Nasdaq National Market trading days of the Notice of Guaranteed Delivery.
Additional copies of the Notice of Guaranteed Delivery may be obtained upon
request from the Company, at the address, or by calling the telephone number,
indicated below.
Payment of the Subscription Price must be made in U.S. dollars for the
full number of shares of Common Stock being subscribed for by (a) check or bank
draft (cashier's check) drawn upon a United States bank or a postal, telegraphic
or express money order payable to the order of First Union National Bank, as
Subscription Agent, or (b) wire transfer of same day funds to the account
maintained by the Subscription Agent for such purpose at __________, ABA No.
__________, Account No. __________ (marked: Midway Airlines Corporation
Subscription). The Subscription Price will be deemed to have been received by
the Subscription Agent only upon (i) the clearance of any uncertified check,
(ii) the receipt by the Subscription Agent of any
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certified check or bank draft drawn upon a U.S. bank or of any postal,
telegraphic or express money order, (iii) receipt by the Subscription Agent of
any funds transferred by wire transfer, or (iv) receipt of funds by the
Subscription Agent through an alternative payment method approved by the
Company.
If paying by uncertified personal check, please note that the funds
paid thereby may take five business days or more to clear. Accordingly, Rights
holders who wish to pay the Subscription Price by means of an uncertified
personal check are urged to make payment sufficiently in advance of the
Expiration Date to ensure that such payment is received and clears by such date
and are urged to consider payment by means of certified or cashier's check,
money order or wire transfer of funds.
Banks, brokers, trusts, depositaries or other nominee holders of the
Rights who exercise the Basic Subscription Privilege and the Over-Subscription
Privilege on behalf of beneficial owners of Rights will be required to certify
to the Subscription Agent and the Company on a Nominee Holder Certification
Form, in connection with the exercise of the Over-Subscription Privilege, as to
the aggregate number of Rights that have been exercised, and the number of
shares of Common Stock that are being subscribed for pursuant to the Over-
Subscription Privilege, by each beneficial owner of Rights on whose behalf such
nominee holder is acting.
The address and telecopier numbers of the Subscription Agent are as
follows:
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By Mail: Facsimile Transmission By Hand or
First Union National Bank (Eligible Institutions only): Overnight
1525 West W.T. Harris ( ) ___-____ Delivery:
Boulevard, 3c3, NC1153
Charlotte, North Carolina To confirm receipt of
28288-1153 facsimile only:
( ) ___-____
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Delivery of Form 1 to an address other than as set forth above or
transmission via a facsimile machine other than as set forth above does not
constitute a valid delivery.
The address and telephone numbers of the Company, for inquiries,
information or requests for additional documentation are as follows:
Steven Westberg
Executive Vice President and General Manager
Midway Airlines Corporation
2801 Slater Road, Suite 200
Morrisville, North Carolina 27560
(919) 595-6000
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If you exercise less than all of the Rights evidenced by your
Subscription Certificate by so indicating on Form 1 of your Subscription
Certificate, you may request that the Subscription Agent issue you a new
Subscription Certificate evidencing the unexercised Rights. However, if you
choose to have a new Subscription Certificate sent to you, you may not receive
any such new Subscription Certificate in sufficient time to permit you to
exercise the Rights evidenced thereby. If you have not indicated the number of
Rights being exercised, or if you have not forwarded full payment of the
Subscription Price for the number of Rights that you have indicated are being
exercised, you will be deemed to have exercised the Basic Subscription Privilege
with respect to the maximum number of whole Rights which may be exercised for
the Subscription Price payment transmitted or delivered by you, and to the
extent that the Subscription Price payment transmitted or delivered by you
exceeds the product of the Subscription Price multiplied by the number of Rights
evidenced by the Subscription Certificate(s) transmitted or delivered by you
(such excess being the "Subscription Excess"), you will be deemed to have
exercised your Over-Subscription Privilege to purchase, to the extent available,
that number of whole shares of the Common Stock equal to the quotient obtained
by dividing the Subscription Excess by the Subscription Price, subject to the
limit on the number of shares a Rights holder may purchase pursuant to the Over-
Subscription Privilege.
2. Conditions to Completion of the Rights Offering.
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There are no conditions to the completion of the Rights Offering.
However, the board of directors of the Company may withdraw the Rights Offering
in its sole discretion at any time prior to or on __________, 2000 for any
reason (including, without limitation, a change in the market price of the
Company's common stock). If the board of directors of the Company withdraws the
Rights Offering, any funds you paid will be promptly refunded, without interest
or penalty.
3. Delivery of Common Stock.
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The following deliveries and payments will be made to the address
shown on the face of your Subscription Certificate unless you provide
instructions to the contrary on Form 2.
(a) Basic Subscription Privilege. As soon as practicable after the
valid exercise of the Rights, the Subscription Agent will mail to
each exercising Rights holder certificates representing shares of
Common Stock purchased pursuant to the Basic Subscription
Privilege.
(b) Over-Subscription Privilege. As soon as practicable after the
Expiration Date, the Subscription Agent will mail to each Rights
holder who validly exercises the Over-Subscription Privilege the
number of shares of Common Stock allocated to such Rights holder
pursuant to the Over-Subscription Privilege. See "The Rights
Offering--Over-Subscription Privilege" in the Prospectus.
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(c) Cash Payments. As soon as practicable after the Expiration Date,
the Subscription Agent will mail to each Rights holder who
exercises the Over-Subscription Privilege any excess funds,
without interest or deduction, received in payment of the
Subscription Price for each share of the Common Stock that is
subscribed for by, but not allocated to, such Rights holder
pursuant to the Over-Subscription Privilege.
4. Execution.
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(a) Execution by Registered Holder(s). The signature on the reverse
of the Subscription Certificate must correspond with the name of
the registered holder exactly as it appears on the Subscription
Certificate without any alteration or change whatsoever. If the
Subscription Certificate is registered in the names of two or
more joint owners, all of such owners must sign. Persons who sign
the Subscription Certificate in a representative or other
fiduciary capacity must indicate their capacity when signing and,
unless waived by the Company in its sole and absolute discretion,
must present to the Subscription Agent satisfactory evidence of
their authority to so act.
(b) Execution by Person Other than Registered Holder. If the
Subscription Certificate is executed by a person other than the
holder named on the face of the Subscription Certificate, proper
evidence of authority of the person executing the Subscription
Certificate must accompany the same unless, for good cause, the
Company dispenses with proof of authority.
(c) Signature Guarantees. Your signature must be guaranteed by an
Eligible Institution if you wish to specify special delivery
instructions pursuant to Form 2.
5. Method of Delivery.
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The method of delivery of Subscription Certificates and payment of the
Subscription Price to the Subscription Agent will be at the election and risk of
the Rights holder, but, if sent by mail, it is recommended that they be sent by
registered mail, properly insured, with return receipt requested, and that a
sufficient number of days be allowed to ensure delivery to the Subscription
Agent and the clearance of any checks sent in payment of the Subscription Price
prior to the Expiration Date.
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6. Substitute Form W-9.
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Each Rights holder who elects to exercise Rights through the
Subscription Agent should provide the Subscription Agent with a correct Taxpayer
Identification Number ("TIN") and, where applicable, certification of such
Rights holder's exemption from backup withholding on Substitute Form W-9. Each
foreign Rights holder who elects to exercise the Rights through the Subscription
Agent should provide the Subscription Agent with certification of foreign status
on Form W-8. Copies of Form W-8 and additional copies of Substitute Form W-9
may be obtained upon request from the Company at the address, or by calling the
telephone number, indicated above. Failure to provide the information on the
form may subject such holder to 31% federal income tax withholding with respect
to dividends that may be paid by the Company on shares of Common Stock purchased
upon the exercise of Rights (for those holders exercising Rights).
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