FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON D.C. 20549
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 1997
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from _______________ to ________________
Commission file number 1-13934
MIDWEST EXPRESS HOLDINGS, INC.
(Exact name of registrant as specified in its charter)
Wisconsin 39-1828757
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
6744 South Howell Avenue
Oak Creek, Wisconsin 53154
(Address of Principal executive offices)
(Zip code)
414-570-4000
(Registrant's telephone number, including area code)
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
As of April 29, 1997, there were 6,330,863 shares of Common Stock, $.01
par value, of the Registrant outstanding.
<PAGE>
MIDWEST EXPRESS HOLDINGS, INC.
FORM 10-Q
For the period ended March 31, 1997
INDEX
PART I - FINANCIAL INFORMATION
Page
No.
Item 1. Financial Statements (unaudited)
Consolidated Statements of Income 3
Consolidated Balance Sheets 4
Consolidated Statements of Cash Flows 5
Unaudited Notes to Consolidated Financial 6
Statements
Item 2. Management's Discussion and Analysis of
Results of Operations and Financial Condition 7
PART II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K 14
SIGNATURES 15
EXHIBIT INDEX 16
<PAGE>
PART I - Financial Statements
MIDWEST EXPRESS HOLDINGS, INC.
CONSOLIDATED STATEMENTS OF INCOME
(Dollars in thousands, except per share amounts)
(Unaudited)
Three Months Ended
March 31,
1997 1996
Operating revenues:
Passenger service $ 71,428 $ 60,915
Cargo 2,593 2,598
Other 5,899 3,095
-------- --------
Total operating revenues 79,920 66,608
-------- --------
Operating expenses:
Salaries, wages and benefits 21,409 17,868
Aircraft fuel and oil 13,402 10,302
Commissions 7,119 5,730
Dining services 3,825 3,477
Station rental, landing and
other fees 6,616 5,344
Aircraft maintenance materials and
repairs 5,910 5,273
Depreciation and amortization 2,101 1,889
Aircraft rentals 4,262 4,076
Other 8,803 8,233
------- -------
Total operating expenses 73,447 62,192
------- -------
Operating income 6,473 4,416
------- -------
Other income (expense):
Interest income 300 267
Other (4) (11)
------- -------
Total other income (expense) 296 256
------- -------
Income before income taxes 6,769 4,672
Provision for income taxes 2,538 1,836
------- -------
Net income $ 4,231 $ 2,836
======= =======
Net income per common share $ 0.67 $ 0.44
======= =======
Weighted average shares
outstanding 6,330,415 6,428,571
========= =========
See notes to consolidated financial statements.
<PAGE>
PART I - Financial Statements
MIDWEST EXPRESS HOLDINGS, INC.
CONSOLIDATED BALANCE SHEETS
(Dollars in thousands)
March 31, December 31,
1997 1996
(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents $ 25,541 $ 27,589
Accounts receivable:
Traffic, less allowance for doubtful
accounts of $265 and $207 at March 31,
1997 and December 31, 1996,
respectively 4,720 4,639
Other receivables 397 592
--------- --------
Total accounts receivable 5,117 5,231
Inventories 3,002 3,122
Prepaid expenses 6,051 4,247
Deferred income taxes 3,324 3,334
Aircraft and modifications intended to be
financed by sale and leaseback
transactions 14,108 9,046
--------- --------
Total current assets 57,143 52,569
--------- --------
Property and equipment, at cost 135,831 130,792
Less accumulated depreciation 62,546 59,889
--------- --------
Net property and equipment 73,285 70,903
Landing slots and leasehold rights, net 5,146 5,228
Other assets 652 435
--------- --------
Total assets $136,226 $129,135
========= ========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 3,634 $ 3,684
Income taxes payable 914 -
Air traffic liability 29,885 22,043
Accrued liabilities:
Scheduled maintenance expense 5,686 5,961
Profit sharing 964 5,345
Vacation pay 2,959 2,957
Frequent Flyer awards 2,925 2,869
Other 14,244 15,504
--------- --------
Total current liabilities 61,211 58,363
--------- --------
Deferred income taxes 9,930 9,894
Noncurrent scheduled maintenance expense 7,206 7,771
Accrued pension and other postretirement
benefits 6,733 6,138
Other noncurrent liabilities 6,542 6,628
--------- --------
Total liabilities 91,622 88,794
--------- --------
Shareholders' equity:
Preferred stock, without par value,
5,000,000 shares authorized, no
shares issued or outstanding - -
Common stock, $.01 par value, 25,000,000
shares authorized, 6,428,571
shares issued 64 64
Additional paid-in capital 9,547 9,545
Treasury stock, at cost (2,642) (2,672)
Retained earnings 37,635 33,404
--------- --------
Total shareholders' equity 44,604 40,341
--------- --------
Total liabilities and shareholders' equity $136,226 $129,135
========= ========
See notes to consolidated financial statements.
<PAGE>
PART I - Financial Statements
MIDWEST EXPRESS HOLDINGS, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Dollars in thousands)
(Unaudited)
Three Months Ended
March 31
1997 1996
Operating activities:
Net income $ 4,231 $ 2,836
Items not involving the use of cash:
Depreciation and amortization 2,101 1,889
Deferred income taxes 46 (756)
Other 1,062 729
Changes in operating assets and liabilities:
Accounts receivable 114 1,438
Inventories 120 456
Prepaid expenses (1,804) 666
Accounts payable (50) (709)
Income taxes payable 914 1,481
Accrued liabilities (5,858) 4,186
Air traffic liability 7,842 432
--------- --------
Net cash provided by operating activities 8,718 12,648
--------- --------
Investing activities:
Capital expenditures (5,468) (4,954)
Aircraft acquisitions and modifications
financed by or intended to be
financed by sale and leaseback
transactions (5,063) (3,449)
Proceeds from sale of property and equipment 4 -
Other (215) (32)
--------- ---------
Net cash used in investing activities (10,742) (8,435)
--------- ---------
Financing activities:
Other (24) 1,458
--------- ---------
Net cash (used in) provided by financing
activities (24) 1,458
--------- ---------
Net (decrease) increase in cash and
cash equivalents (2,048) 5,671
Cash and cash equivalents, beginning of period 27,589 14,626
--------- ---------
Cash and cash equivalents, end of period $ 25,541 $ 20,297
========= =========
See notes to consolidated financial statements.
<PAGE>
Midwest Express Holdings, Inc.
Unaudited Notes to Consolidated Financial Statements
1. Business and Basis of Presentation
Basis of Presentation
The consolidated financial statements for the three-month period
ended March 31, 1997 are unaudited and reflect all adjustments
(consisting only of normal recurring adjustments) that are, in the
opinion of management, necessary for a fair presentation of the
financial position and operating results for the interim period. The
consolidated financial statements should be read in conjunction with
the consolidated financial statements and notes thereto, together
with management's discussion and analysis of financial condition and
results of operations, contained in the Company's Annual Report to
Shareholders and incorporated by reference in the Company's Annual
Report on Form 10-K for the year ended December 31, 1996. The
results of operations for the three-month period ended March 31, 1997
are not necessarily indicative of the results for the entire fiscal
year ending December 31, 1997.
Stock Split
On April 23, 1997, the Company announced that its board of directors
had approved a plan to split its stock 3-for-2 in the form of a 50%
stock dividend. The new shares will be issued May 28 to shareholders
of record as of May 12. The financial information presented herein
does not reflect the effect of the stock split.
<PAGE>
Part I Item 2.
Management's Discussion and Analysis of Results of Operations
and Financial Condition
Results of Operations
Overview
The Company's 1997 first quarter operating income was $6.5 million, an
increase of $2.1 million from the first quarter 1996. Net income
increased by $1.4 million, or 49.2%, to $4.2 million. Year-to-date
earnings per share were $.67, a $.23 or 52.3% increase over 1996 results.
The Company's total revenue in the first quarter increased $13.3 million,
or 20.0%, relative to the first quarter 1996, while operating costs
increased by $11.2 million, or 18.1%. The favorable change in revenue in
the quarter was primarily the result of improvements in passenger revenue
yield; increased passenger volume resulting from service expansions during
1996 and early 1997 and improved weather; and an increase in supplemental
revenue from the Midwest Express credit card program and charter services.
The cost increases in the first quarter were the result of higher fuel,
labor, commission and airport costs and expenses associated with service
expansions since the first quarter 1996.
An increase in revenue yield was an important factor in the improved
financial results. For the first quarter, Midwest Express revenue yield
increased 11.8% from 17.9 cents in 1996 to 20.0 cents in 1997. Skyway
yield increased 6.3%. The yield gains were broad based, with almost every
market, excluding the West Coast, realizing improvement. The temporary
suspension of the 10 percent federal excise tax from January 1 to March 7
had a favorable, but not quantifiable, impact on yield during the first
quarter 1997.
Service expansions since the first quarter 1996 significantly contributed
to the increase in revenue in the first quarter 1997. The first quarter
benefited from the service expansion in May 1996 when one DC-9 aircraft
was placed in service and September 1996 when another DC-9 aircraft was
placed in service. Traffic also benefited from improved weather in the
first quarter 1997. Weather-related cancellations decreased from 2.7% of
operations in the first quarter 1996 to 1.5% in 1997.
Midwest Express' credit card and charter programs also favorably impacted
financial results in the 1997 first quarter. The credit card program,
which was implemented in October 1995, generated $.6 million more revenue
in the first quarter 1997 than in the first quarter 1996. In addition,
Midwest Express dedicated one aircraft to charter programs beginning in
the second quarter 1996, resulting in charter revenue increasing $1.5
million in 1997 over 1996.
Negatively impacting operating income was an 18.1% increase in operating
expenses. Significant increases occurred in fuel, labor, commissions and
airport costs, which are explained in the subsequent sections.
Operating Statistics
The following table provides selected operating statistics for Midwest
Express and Skyway.
Three Months Ended
March 31,
%
1997 1996 Change
Midwest Express Operations
Origin & Destination Passengers 340,379 317,889 7.1%
Revenue Passenger Miles (000s) 313,416 292,258 7.2%
Scheduled Service Available Seat
Miles (000s) 520,437 461,634 12.7%
Total Available Seat Miles (000s) 536,718 470,961 14.0%
Load Factor (%) 60.2% 63.3% -3.1 pts
Revenue Yield $0.200 $0.179 11.8%
Cost per total ASM $0.121 $0.116 4.2%
Average Passenger Trip Length 920.8 919.4 0.2%
Number of Flights 9,144 8,278 10.5%
Into-plane Fuel Cost per Gallon $0.804 $0.703 14.4%
Full-time equivalent Employees at
End of Period 1,730 1,447 19.6%
Aircraft in Service at End of Period 22 19 15.8%
Skyway Airlines Operations
Origin & Destination Passengers 68,782 72,932 -5.7%
Revenue Passenger Miles (000s) 15,823 16,613 -4.8%
Scheduled Service Available Seat
Miles (000s) 38,665 39,113 -1.1%
Total Available Seat Miles (000s) 38,741 39,175 -1.1%
Load Factor (%) 40.9% 42.5% -1.6 pts
Revenue Yield $0.555 $0.522 6.3%
Cost per total ASM $0.245 $0.214 14.1%
Average Passenger Trip Length 230.0 227.8 1.0%
Number of Flights 10,073 10,396 -3.1%
Into-plane Fuel Cost per Gallon $0.858 $0.774 10.9%
Full-time equivalent Employees
at End of Period 247 218 13.3%
Aircraft in Service at End of Period 15 15 -
Note: With the exception of total available seat miles, cost per total
ASM, into-plane fuel cost, number of employees and aircraft in
service, statistics exclude charter operations. Aircraft
acquired but not yet placed into service are excluded from the
aircraft in service statistics.
The following table provides operating revenues and expenses for the
Company expressed as cents per total ASM, including charter operations,
and as a percentage of total revenues.
Three Months Ended March 31,
1997 1996
Per Total % of Per Total % of
ASM Revenue ASM Revenue
Operating revenues:
Passenger service $0.124 89.4% $0.120 91.6%
Cargo 0.005 3.2% 0.005 3.8%
Other 0.010 7.4% 0.006 4.6%
------ ------ ----- ------
Total operating revenues 0.139 100.0% 0.131 100.0%
Operating expenses:
Salaries, wages and benefits 0.038 26.8% 0.035 26.7%
Aircraft fuel and oil 0.023 16.8% 0.020 15.3%
Commissions 0.012 8.9% 0.011 8.4%
Dining services 0.007 4.8% 0.007 5.3%
Station rental, landing and
other fees 0.012 8.3% 0.011 8.4%
Aircraft maintenance materials
and repairs 0.010 7.4% 0.010 7.6%
Depreciation and amortization 0.004 2.6% 0.004 3.1%
Aircraft rentals 0.008 5.3% 0.008 6.1%
Other 0.015 11.0% 0.016 12.2%
------ ----- ------ -----
Total operating expenses $0.128 91.9% $0.122 93.1%
====== ===== ====== =====
Total ASMs (000s) 575,459 510,135
Note: Numbers in this table cannot be recalculated due to rounding.
Three Months Ended March 31, 1997 Compared to
Three Months Ended March 31, 1996
Operating Revenues
Company operating revenues totalled $79.9 million in the first quarter
1997, a $13.3 million or 20.0% increase over the first quarter 1996.
Passenger revenues accounted for 89.4% of total revenues and increased
$10.5 million, or 17.3%, from 1996 to $71.4 million. The increase is
attributable to a 6.6% increase in passenger volume, as measured by
revenue passenger miles, and a 10.0% increase in revenue yield.
Midwest Express passenger revenue increased by $10.4 million, or 19.9%,
from 1996 to $62.6 million. This increase was caused by a 7.1% increase
in origin and destination passengers and an 11.8% increase in revenue
yield. Total capacity, as measured by scheduled service ASMs, increased
12.7% because of the addition of aircraft in May and September 1996. Load
factor decreased from 63.3% in 1996 to 60.2% in 1997. The yield
improvement was generally the result of an improved pricing environment in
the industry and the temporary suspension of the 10% passenger ticket tax
from January 1 to March 7, 1997.
Skyway passenger revenue increased by $.1 million, or 1.3%, from 1996 to
$8.8 million. This increase was caused by a 6.3% increase in revenue
yield, offset by a 5.7% decrease in origin and destination passengers.
Average passenger trip length increased 1.0%. Total capacity decreased by
1.1%. Load factor decreased from 42.5% in 1996 to 40.9% in 1997.
Skyway's results were negatively impacted by schedule changes and
increased competition in selected markets.
Revenue from cargo, charter and other services increased $2.8 million in
the first quarter 1997. Charter revenue increased $1.5 million because
Midwest Express had one aircraft dedicated to charter operations during
the first quarter 1997 and did not have a dedicated aircraft in the first
quarter 1996. Revenue from the Midwest Express MasterCard program
increased $.6 million.
Operating Expenses
1997 operating expenses increased by $11.3 million, or 18.1%, from 1996.
The increase was primarily the result of higher costs associated with
fuel, labor, commissions, airport costs and the service expansions since
the first quarter 1996. Cost per total ASM increased 4.7%, from 12.2
cents in 1996 to 12.8 cents in 1997.
Salaries, wages and benefits increased by $3.5 million, or 19.8%. On a
cost per total ASM basis, these costs increased 6.2%, from 3.5 cents in
1996 to 3.7 cents in 1997. The labor cost increase reflects the addition
of approximately 312 full-time equivalent employees since March 31, 1996;
283 at Midwest Express and 29 at Skyway. Midwest Express added employees
throughout the organization to support the aircraft placed in service
during 1996 and 1997. Skyway added employees primarily in the flight
operations and maintenance functions. The labor cost increase was also
due to an adjustment in pay scales for most operations' employees at
Midwest Express effective January 1, 1997. These rate adjustments were
implemented based upon industry salary surveys and management's desire to
increase pay scales to maintain a competitive position within the
industry. Labor costs increased $.4 million because of accruals for
Midwest Express' profit sharing and management incentive programs. The
profit sharing and incentive plans, which benefit substantially all
employees, are based entirely on achieving certain levels of
profitability, are payable annually and are accrued monthly based upon
earnings to date and projected results for the remainder of the year.
Aircraft fuel and oil and associated taxes increased $3.1 million, or
30.1%, in 1996. Into-plane fuel prices increased 14.1% in 1997, averaging
80.8 cents per gallon in 1997 and 70.9 cents per gallon in 1996. Fuel
consumption increased by 14.1% in the quarter, primarily because Midwest
Express operated 15.6% more aircraft flight hours. Fuel costs in April
1997 continued to trend downward, averaging 73.7 cents per gallon.
Commissions increased by $1.4 million, or 24.2%, and 10.1% on a cost per
total ASM basis. The increase in passenger revenue of 17.3% directly
impacted commission costs, but cost per total ASM increased primarily
because of higher revenue yield.
Maintenance costs increased by $.6 million, or 12.1%, from 1996. The
increase was caused by more flight hours at Midwest Express and an
increase in the rate of engine overhaul accruals, offset by fewer
unscheduled engine overhauls and a favorable MD-88 airframe overhaul
adjustment. The cost increase for engine overhaul accruals was the result
of higher expected costs to complete future major engine maintenance. The
favorable MD-88 airframe overhaul adjustment was due to scheduled
maintenance accruals exceeding the actual costs incurred in the first
quarter 1997, as both MD-88 aircraft had scheduled major maintenance.
Station rental, landing and other fees increased by $1.3 million, or
23.8%, from 1996. The increase was caused by 10.5% more flight segments
by Midwest Express, increasing costs for and usage of deicing fluid, and
significantly higher airport costs primarily for purchased security
services and landing fees.
Depreciation and amortization increased by $.2 million, or 11.2%, from
1996. The increase was primarily the result of the depreciation
associated with capital spending and the decision to exercise purchase
options on two leased jet aircraft in October 1996, offset by two jet
aircraft becoming fully depreciated during 1996.
Aircraft rental costs increased by $.2 million in 1997 as a result of
Midwest Express leasing four additional aircraft in 1997. This increased
cost was partially offset by lower lease costs for Skyway's 15 turboprop
aircraft that were refinanced in the second and third quarter 1997 and the
decision to exercise purchase options on two leased jet aircraft in
October 1996.
Other operating expenses increased by $.6 million, or 6.9%, from 1996.
Other cost increases included increased charter costs due to additional
charter volume, higher property tax costs because of more aircraft,
additional overnight costs for flight crews associated with flight
schedule changes, and telecommunication costs. These cost increases were
partially offset by lower advertising, legal and headquarters relocation
costs in the first quarter 1997.
Provision for Income Taxes
Income tax expense for the first quarter 1997 was $2.5 million, a $.7
million increase from 1996. The effective tax rates for the first quarter
of 1997 and 1996 were 37.5% and 39.3%, respectively. For purposes of
calculating the Company's income tax expense and effective tax rate, the
Company treats amounts payable to an affiliate of Kimberly-Clark under a
tax allocation and separation agreement entered into in connection with
the Company's initial public offering as if they were payable to taxing
authorities.
Net Income
Net income for the first quarter increased $1.4 million from 1996. The
net income margin improved from 4.3% in 1996 to 5.3% in 1997.
Liquidity and Capital Resources
The Company's cash and cash equivalents totalled $25.5 million at March
31, 1997, compared to $27.6 million at December 31, 1996. Net cash
provided by operating activities totalled $8.7 million for the three
months ended March 31, 1997. Net cash used in investing activities
totalled $10.7 million, primarily due to aircraft acquisitions and related
modifications in 1997 of $5.1 million, which are intended to be financed
by sale and leaseback transactions and due to capital expenditures of $5.5
million.
As of March 31, 1997, the Company had a working capital deficit of $4.1
million versus a $5.8 million deficit on December 31, 1996. The working
capital deficit is due to the Company's air traffic liability (advance
bookings, whereby passengers have purchased tickets for future flights),
accrued scheduled maintenance expense and accrued lease payments. Because
of these items, the Company expects to operate periodically with a working
capital deficit, which is not unusual for the industry.
The Company has no debt, other than its lease commitments. As of March
31, 1997, the Company's two credit facilities, a $35.0 million revolving
bank credit facility and a $20.0 million secondary revolving credit
facility with Kimberly-Clark, have not been used except for letters of
credit totalling approximately $12.1 million that reduce the amount of
available credit. On April 30, 1997, the Company increased its revolving
bank credit facility by $20.0 million.
Capital expenditures totalled $5.5 million for the three months ended
March 31, 1997, not including aircraft acquisitions. Capital expenditures
primarily consisted of the completion of Midwest Express' hangar
expansion, the acquisition of an office building for Skyway, capitalized
engine overhauls, capitalized aircraft major maintenance and one spare
aircraft engine.
Aircraft acquisitions and modifications intended to be financed by sale
and leaseback transactions totalled $5.1 million during the three months
ended March 31, 1997. Modifications to aircraft not yet in service
include maintenance inspection and modification, hush kit installation and
complete interior refurbishment. During the remainder of 1997, the
Company intends to finalize sale and leaseback transactions on four DC-9-
30 aircraft acquired in 1996, in which case the Company would be
reimbursed for approximately $14.1 million of related aircraft acquisition
and modification costs incurred to March 31, 1997.
As of March 31, 1997, leases relating to three of Midwest Express' jet
aircraft are guaranteed by Kimberly-Clark in return for a guarantee fee
paid by the Company. Kimberly-Clark will continue to guarantee these
leases until the end of the current lease terms. None of these jet
aircraft leases expires before 2001.
In December 1995, the Company announced a $5.0 million share repurchase
program to be executed from time to time in the open market or in
privately negotiated transactions. As of March 31, 1997, the Company has
purchased 103,700 shares at a cost of $2.8 million. It anticipates
completing this share repurchase program during the remainder of 1997.
The Company believes its cash flow from operations, funds available from
credit facilities and available long-term financing for the acquisition of
jet aircraft and turboprop aircraft will be adequate to provide for
working capital needs and capital expenditures through 1997.
Pending Developments
New Aircraft - Four DC-9 aircraft acquired during 1996 will be placed into
service during 1997 after maintenance inspection and modification, hush
kit installation and complete interior refurbishment. The first aircraft
enables Midwest Express to provide year-round service to Orlando, Florida.
The second aircraft allows Midwest Express to initiate service between
Kansas City and New York/LaGuardia. The third aircraft will be placed
into service late in the third quarter and plans for this aircraft have
not been announced. The fourth aircraft will initially be used as a
maintenance spare.
Stock Split - On April 23, 1997, the Company announced that its board of
directors had approved a plan to split its stock 3-for-2 in the form of a
50% stock dividend. The new shares will be issued May 28 to shareholders
of record as of May 12. Fractional shares will be paid to shareholders in
cash. The financial information presented in Management's Discussion and
Analysis of Results of Operations and Financial Condition does not reflect
the effect of the stock split.
Other Issues - The Company's annual report for the year ended December 31,
1997, disclosed certain issues relating to the White House Commission on
Aviation Safety and Security, labor relations and sales taxes. These
issues remain pending.
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
The exhibits filed herewith or incorporated by reference are
set forth on the attached Exhibit Index.
(b) Reports on Form 8-K
No reports on Form 8-K were filed during the quarter ended
March 31, 1997.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by
the undersigned thereunto duly authorized.
Midwest Express Holdings, Inc.
Date: May 12, 1997 By /s/ Timothy E. Hoeksema
Timothy E. Hoeksema
Chairman of the Board,
President and Chief Executive
Officer
Date: May 12, 1997 By /s/ Robert S. Bahlman
Robert S. Bahlman
Vice President, Chief Financial
Officer, Treasurer and
Controller
<PAGE>
EXHIBIT INDEX
Number Description
(4.1) Second Amendment to Credit Agreement, dated as of
April 30,1997, amending the Credit Agreement dated
September 27, 1995, as amended to date, among Midwest
Express Holdings, Inc., Firstar Bank Milwaukee, N.A.,
M&I Marshall & Ilsley Bank, and Bank One, Milwaukee,
N.A.
(10.1) Amendment No. 3, dated November 6, 1996, to Lease
Agreement between Milwaukee County and Midwest Express,
dated May 12, 1988.
(10.2) Amendment No. 9, dated March 6, 1996, to Airline Lease,
as amended, between Milwaukee County and Midwest
Express, dated October 1, 1984.
(27) Financial Data Schedule.
SECOND AMENDMENT TO
CREDIT AGREEMENT
THIS SECOND AMENDMENT TO CREDIT AGREEMENT (the "Second Amendment"),
dated as of April 30, 1997, amends the Credit Agreement dated September
27, 1995, as amended to date (the "Credit Agreement") by and among Midwest
Express Holdings, Inc. (the "Company"), Firstar Bank Milwaukee, N.A.
("Firstar"), M&I Marshall & Ilsley Bank ("M&I") and Bank One, Wisconsin
(f/k/a Bank One, Milwaukee, NA; "Bank One")(Firstar, M&I and Bank One are
sometimes referred to collectively herein as the "Banks").
1. Definitions. Capitalized terms not otherwise defined herein
shall have the meanings assigned to them in the Credit Agreement.
2. Amendments. The parties hereby agree to amend the Credit
Agreement as follows:
(a) All references in the Credit Agreement to "Midwest Express
Holdings, Inc., a Delaware corporation" are hereby deleted in their
entirety and replaced with "Midwest Express Holdings, Inc., a Wisconsin
corporation."
(b) All references in the Credit Agreement to "Bank One,
Milwaukee, NA" are hereby deleted in their entirety and replaced with
"Bank One, Wisconsin."
(c) Section 1.1 is deleted in its entirety and replaced with the
following:
"1.1 Revolving Credit. From time to time prior to April 29,
2002 or the earlier termination in full of the Commitments (in either
case, the "Termination Date"), the Company may obtain loans from each of
the Banks, pro rata according to each Bank's Percentage Interest, up to an
aggregate principal amount equal to the amount by which (i) $55,000,000
(the "Aggregate Commitment," and as to each Bank's respective Percentage
Interest thereof, its "Commitment"), as terminated or reduced pursuant to
section 1.6, exceeds (ii) the sum of (A) the aggregate amount of Letter of
Credit Obligations (as defined in section 9.1(n) below), and (B) the
aggregate face amount of outstanding Commercial Paper (as defined in
section 9.1(d) below). The Commitment and Percentage Interest of each
Bank is set forth in the table below:
Percentage
Name of Bank Commitment Interest
Firstar Bank Milwaukee, N.A. $26,500,000 48.1818%
M&I Marshall & Ilsley Bank $20,500,000 37.2727%
Bank One, Wisconsin $ 8,000,000 14.5455%
----------- -------
TOTAL: $55,000,000 100%
The failure of any one or more of the Banks to lend in accordance with its
Commitment shall not relieve the other Banks of their several obligations
hereunder, but no Bank shall be liable in respect of the obligation of any
other Bank hereunder or be obligated in any event to lend in excess of its
Commitment. Subject to the limitations of section 2.2(d)(3), the Company
may repay such loans and reborrow hereunder from time to time prior to the
Termination Date. Each loan hereunder from the Banks collectively shall
be in a multiple of $100,000 (except that any such loan subject to a LIBOR
Pricing Option shall be in an amount of $1,000,000 or any multiple of
$100,000 in excess of such amount). The loans from each Bank advanced
under this section 1.1 shall be evidenced by a single promissory note of
the Company (each, a "Note" or an "Amended and Restated Revolving Credit
Note" and collectively, the "Notes" or the "Amended and Restated Revolving
Credit Notes") in the form of Exhibit A attached hereto, payable to the
order of the lending Bank."
(d) The reference in Section 1.8(a) to "$35,000,000" is deleted
and replaced with "$55,000,000."
3. Conditions Precedent. This Second Amendment shall become
effective on the date that the Agent (for the benefit of the Banks) shall
have received each of the following (the "Effective Date"):
(a) this Second Amendment, duly executed by an authorized
representative of each of the Company and the Banks, and consented to by a
duly authorized representative of each of Midwest Express Airlines, Inc.
and Astral Aviation, Inc.;
(b) the Amended and Restated Revolving Credit Notes in the form
of Exhibit A attached hereto, duly executed by an authorized
representative of the Company and dated as of the date of this Second
Amendment;
(c) a copy of resolutions of the board of directors of the
Company authorizing the execution, delivery and performance of the
transactions contemplated by this Second Amendment and the Amended and
Restated Revolving Credit Notes, certified to be in full force and effect
as of the Effective Date by the Secretary or Assistant Secretary of the
Company;
(d) a certificate of status for the Company as of a recent date
by the Wisconsin Department of Financial Institutions;
(e) an incumbency certificate for the Company, executed by the
Secretary or Assistant Secretary of the Company, identifying by name and
title and bearing the signature of the officer(s) of the Company
authorized to sign this Second Amendment and to act with respect to the
Credit Agreement, upon which certificate the Banks shall be entitled to
rely until informed of any change in writing by the Company; and
(f) prior to the making of any loan hereunder, a completed and
executed Borrower's Certificate in the form of Exhibit 6.5 to the Credit
Agreement.
4. Representations and Warranties. (a) The Company certifies that
the representations and warranties contained in the Credit Agreement are
true and correct as of the date of this Second Amendment (other than with
respect to the date set forth in the last sentence of section 4.8), and
that, after giving effect to the transactions contemplated by this Second
Amendment, no condition, event, act or omission has occurred which would
constitute a Default or Event of Default under the Credit Agreement.
(b) The Company further certifies that, as of the date hereof and
after giving effect to the transactions contemplated by this Second
Amendment, no condition, event, act or omission has occurred which would
constitute a Default or an Event of Default under that certain Credit
Agreement by and between the Company and Kimberly-Clark Corporation dated
September 27, 1995.
5. Full Force and Effect. Except as provided herein, all of the
terms and conditions set forth in the Credit Agreement, and all additional
documents entered into in connection with the Credit Agreement, shall
remain unchanged and shall continue in full force and effect as originally
set forth.
6. Binding Effect. This Second Amendment shall be binding upon the
parties hereto and their respective successors and assigns.
7. Counterparts. This Second Amendment may be executed in several
counterparts, each of which shall be deemed an original, but such
counterparts shall together constitute but one and the same Second
Amendment.
REMAINDER OF PAGE DELIBERATELY BLANK
IN WITNESS WHEREOF, the parties hereto have executed this Second
Amendment to Credit Agreement as of the date first set forth above.
MIDWEST EXPRESS HOLDINGS, INC.
By: __________________________
Title: _______________________
FIRSTAR BANK MILWAUKEE, N.A.
By: __________________________
Title: _______________________
M&I MARSHALL & ILSLEY BANK
By: __________________________
Title: _______________________
BANK ONE, WISCONSIN (f/k/a Bank One,
Milwaukee, NA)
By: __________________________
Title: _______________________
CONSENT OF GUARANTORS
Midwest Express Airlines, Inc. and Astral Aviation, Inc. hereby
consent to the foregoing Second Amendment to Credit Agreement and ratify
and reaffirm their respective Subsidiary Guaranties dated as of September
25, 1995.
MIDWEST EXPRESS AIRLINES, INC.
By: __________________________
Title: _______________________
ASTRAL AVIATION, INC.
By: __________________________
Title: _______________________
<PAGE>
EXHIBIT A
AMENDED AND RESTATED
REVOLVING CREDIT NOTE
$ ______________________ April 30, 1997
FOR VALUE RECEIVED, Midwest Express Holdings, Inc., a Wisconsin
corporation, promises to pay to the order of ____________
___________________, the principal sum of _____________________________ ($
_______________________) at the Main Office of
____________________________ in Milwaukee, Wisconsin, on April 29, 2002.
The unpaid principal balance hereof shall bear interest, payable on the
dates specified in the Credit Agreement referred to below, computed at the
Applicable Rate as defined in such Credit Agreement.
Principal amounts unpaid at the maturity hereof (whether by fixed
maturity, acceleration or otherwise) shall bear interest from and after
maturity until paid computed at a rate equal to 2% per annum plus the rate
otherwise payable hereunder. Principal of and interest on this Note shall
be payable in lawful money of the United States of America.
The principal balance of this Note includes the indebtedness hitherto
evidenced by that certain Revolving Credit Note issued as of September 27,
1995 in the original principal amount of $ _______________ from the
Company to _________________________ (the "Original Note"). To the extent
that such indebtedness is included in this Note, this Note (i) merely
reevidences the indebtedness hitherto evidenced by the Original Note, (ii)
is given in replacement of and substitution for the Original Note, and not
as payment of the Original Note, and (iii) is in no way intended to
constitute a novation of the Original Note.
This Note constitutes one of the Amended and Restated Revolving
Credit Notes issued under a Credit Agreement dated September 27, 1995, as
amended by that First Amendment to Credit Agreement dated as of May 30,
1996 and that Second Amendment to Credit Agreement dated as of April 30,
1997 (as so amended, the "Credit Agreement"), among the undersigned,
_________________________, and the other banks party thereto, to which
Credit Agreement reference is hereby made for a statement of the terms and
conditions on which loans in part evidenced hereby were or may be made,
and for a description of the conditions upon which this Note may be
prepaid, in whole or in part, or its maturity accelerated.
MIDWEST EXPRESS HOLDINGS, INC.
By: __________________________
Title: _______________________
Amendment No. 3
to
Airport Agreement No. AC-965
THIS AMENDMENT TO A CONTRACT OF LEASE is made and entered into as of
the 6th day of November, 1996, by and between MILWAUKEE COUNTY, a
municipal corporation, organized and existing as one of the counties in
Wisconsin (hereinafter referred to as "Lessor" or "County"), and MIDWEST
EXPRESS AIRLINES, INC., a corporation organized and existing under the
laws of the State of Wisconsin (hereinafter referred to as "Lessee" or
"Midwest Express").
W I T N E S S E T H :
THAT, WHEREAS, the parties hereto have heretofore entered into a
lease agreement known as Airport Agreement No. AC-965 dated May 12, 1988,
as amended ("Agreement"), relating to air cargo apron space and the lease
of land for construction of an aircraft maintenance hangar on the premises
of General Mitchell International Airport; and,
WHEREAS, Carrier has requested to lease additional land, adjacent to
the area presently leased by Lessee for the purpose of erecting a support
building adjacent to the west side of its maintenance hangar; and,
WHEREAS, County's Board of Supervisors, in its meeting of
March 21, 1996, (File No. 96-243) has approved an amendment to Airport
Agreement No. AC-965 between Milwaukee County and Midwest Express
Airlines, Inc., to add the additional land, originally estimated at 10,200
square feet to the agreement; and,
WHEREAS, the actual square footage changes incorporated into this
amendment are 14,967 square feet added to Lot 7, 4,519 square feet added
to Lot 7(w), and 3,968 square feet deducted from Lot 6;
NOW, THEREFORE, for and in consideration of the premises and of the
mutual covenants and agreements herein contained and other valuable
considerations, it is mutually agreed between the parties hereto that the
Agreement be and is hereby amended in the following particulars, to wit:
1. Effective September 1, 1996, paragraph 1, Description of Leased
Premises, is deleted in its entirety and replaced as follows:
"1. Lessor hereby leases, demises, and lets unto Lessee and Lessee
hereby hires and takes from Lessor, certain lands situated on
the premises of General Mitchell International Airport, located
in the City of Milwaukee, County of Milwaukee, Milwaukee,
Wisconsin, shown on Exhibit "A" (Revised 9/96) attached hereto
and made a part hereof, known and described as follows:
(a) A rectangular parcel of land located in the Northeast one-
quarter of Section Thirty-two (32), Township Six (6) North,
Range Twenty-one (21) East, City of Milwaukee, Milwaukee
County, Wisconsin bounded by the following coordinates
based on the Wisconsin State Plane Coordinate System, South
Zone:
Commencing at coordinate North 351,256.75 - East
2,557,025.19 which is the north one quarter corner of
Section 32, Township 6 North, Range 21 East; thence South
00 degrees 56' 07" East, on and along the west line of the
Northeast one - quarter of said section 593.78 feet to
coordinate point North 350,663.09 - East 2,557,034.88;
thence North 70 degrees 12' 33" East 260.00 feet to
coordinate point north 350,751.12 -East 2,557,297.52 which
is the point of beginning of Lot 7; thence South 19 degrees
47' 27" East 180.00 feet to coordinate point North
350,581.75 - East 2,557,340.47; thence South 70 degrees 12'
33" west 86.50 feet to coordinate point North 350,552.46 -
East 2,557,259.08; thence South 19 degrees 47' 27" East
50.70 feet to coordinate point North 350,504.75 - East
2,557,276.24; thence North 70 degrees 12' 33" East 50.00
feet to coordinate point North 2,557,323.29 - East
350,521.68; thence South 19 degrees 47' 27" East 131.54
feet to coordinate point North 350,397.91 - East
2,557,367.83; thence South 70 degrees 12' 33" West 20.00
feet to coordinate point North 350,391.14 - East
2,557,349.00; thence South 19 degrees 47' 27" East 32.73
feet to coordinate point North 350,360.35 - East
2,557,360.09; thence North 70 degrees 12' 33" East 366.48
feet to coordinate point North 350,484.44 - East
2,557,704.92; thence North 19 degrees 47' 27" West 395.00
feet to coordinate point North 350,856.08 - East
2,557,571.19; thence South 70 degrees 12' 33" West 310.00
feet to the point of beginning, containing 133,467 square
feet more or less (3.06 acres) hereinafter referred to a
Lot 7.
(b) A rectangular parcel of land located in the Northeast one-
quarter of Section Thirty-two (32), Township Six (6) North,
Range Twenty-one (21) East, City of Milwaukee, Milwaukee
County, Wisconsin bounded by the following coordinates
based on the Wisconsin State Plane Coordinate System, South
Zone:
Commencing at coordinate North 351,256.75 - East
2,557,025.19 which is the north one-quarter corner of
Section 32, Township 6 North, Range 21 East; thence South
00 degrees 56' 07" East, on and along the west line of the
Northeast one-quarter of said section 593.78 feet to
coordinate point North 350,663.09 - East 2,557,034.88;
thence North 70 degrees 12' 33" East 34.85 feet to
coordinate point North 350,674.89 - East 2,557,067.68 which
is the point of beginning of Lot 7(w) about to be
described; continuing thence North 70 degrees 12' 33" East
225.14 feet to coordinate point North 350,751.12 - East
2,557,279.52; thence South 19 degrees 47' 27" East 180.00
feet to coordinate point North 350,581.75 - East
2,557,340.47; thence South 70 degrees 12' 33" West 286.58
feet to coordinate point North 350,484.72 - East
2,557,070.81; thence North 00 degrees 56' 07" West 190.20
feet to the point of beginning containing 46,054 (1.06
acres) square feet more or less, hereinafter referred to as
Lot 7(w)."
2. Effective September 1, 1996, the following is added to the end of
paragraph 3 (a):
"Commencing September 1, 1996, Lessee shall pay Lessor the then
current rental rate of Seventeen and Thirty-six Cents (17.36) per
square foot per annum for the 133,467 square feet of land
hereinbefore described, which amounts to an annual rental of Twenty-
three Thousand One Hundred Sixty-nine and 87/100 Dollars
($23,169.87)."
3. Effective September 1, 1996, paragraph 5 (a) is deleted in its
entirety and replaced as follows:
"5. (a) Lessor hereby leases, demises, and lets unto Lessee
exclusively, and Lessee hereby hires and takes from Lessor
the exclusive option to lease certain lands situated on the
premises of General Mitchell International Airport, located
in the City of Milwaukee, County of Milwaukee, Milwaukee,
Wisconsin, shown on Exhibit "A" (Revised 9/96) attached
hereto and made a part hereof, known and described as
follows:
A rectangular parcel of land located in the Northeast one-
quarter of Section Thirty-two (32), Township Six (6) North,
Range Twenty-one (21) East, City of Milwaukee, Milwaukee
County, Wisconsin bounded by the following coordinates
based on the Wisconsin State Plane Coordinate System, South
Zone:
Commencing at coordinate North 351,256.75 - East
2,557,025.19 which is the north one-quarter corner of
Section 32, Township 6 North, Range Twenty-one East; thence
South 00 degrees56' 07" East, on and along the west line of
the Northeast one-quarter of said section 593.78 feet to
coordinate point North 350,663.09 - East 2,557,034.88;
thence North 70 degrees 12' 33" East 569.98 feet to
coordinate point North 350,856.08 - East 2,557,571.19 which
is the point of beginning of Lot 6; thence South 19 degrees
47' 27" East 395.00 feet to coordinate point North
350,484.44 - East 2,557,704.92; thence North 70 degrees 12'
33" East 290.00 feet to coordinate point North 350,582.62 -
East 2,557,977.77; thence North 19 degrees 47' 27" West
395.00 feet to coordinate point North 350,954.26 - East
2,557,844.04; thence South 70 degrees 12' 33" West feet to
the point of beginning, containing 114,532 square feet
(2.63 acres) more or less, hereinafter referred to as Lot
6."
4. The following sentence is inserted after sentence 1 of paragraph 5
(c):
"As of September 1, 1996, Lessee shall pay as an option fee one-sixth
(1/6) of the current land rental rate established in paragraph 3(a)
for the 114,532 square feet of land described hereinbefore, and
herein referred to as Lot 6, which amounts to an annual option fee of
Three Thousand Three Hundred Twenty-one and 43/100 Dollars
($3,321.43)."
5. The following paragraphs 7 (f) and 7 (g) are added after paragraph 7
(e):
"7. (f) The area identified on Exhibit "A" (Revised 9/96) as "Fire
Dept Access Only" is only for the use of fire department
vehicles and personnel. This entire area is to remain free
and clear of encumbrances, and is not to be used for parts
storage, warehousing equipment, or vehicle parking."
"7. (g) Lessee's operation on the leased premises is not to
interfere in any way with the operation of the Airport
Surveillance Radar (ASR) adjacent to the leased premises in
accordance with Airspace Case Number 96-AGL-1213-NRA, as
referenced in Supplement No. 10 to Contract DTFA14-80-L-
R117 between Milwaukee County and the United States
Department of Transportation, Federal Aviation
Administration, attached hereto as Exhibit D."
6. Except as specifically provided herein, the terms and conditions of
the Agreement heretofore entered into between the parties dated May
12, 1988, as amended, shall remain in full force and effect.
IN WITNESS WHEREOF, the parties hereto have caused these presents to
be signed by their respective proper officers and their corporate seals
hereto affixed on the dates hereinafter set forth.
MILWAUKEE COUNTY
APPROVED: a municipal corporation
/s/ 10/31/96 By /s/ Tyrone P. Dumas 11/4/96
Airport Director Date Tyrone P.Dumas
Director of Public Works
/s/ By /s/ Rod Lanser 11/6/96
Corporation Counsel Date Rod Lanser
County Clerk
LESSOR
MIDWEST EXPRESS AIRLINES, INC.
a Wisconsin corporation
By /s/ Brenda Skelton
Brenda Skelton
Title Sr. Vice President
Date 10/15/96
By
Title
Date
LESSEE
<PAGE>
STATE OF WISCONSIN )
) ss
MILWAUKEE COUNTY )
Personally came before me this 4th day of November, 1996, the above
named Tyrone P. Dumas, Director of Public Works of Milwaukee County, to me
known to be the person who executed the foregoing instrument on behalf of
Milwaukee County, and acknowledged the same to be the free act and deed of
said County made by its authority.
/s/ Connie Arnold
Notary Public, Milwaukee County, Wis.
My commission expires July 23, 2000
STATE OF WISCONSIN )
) ss
MILWAUKEE COUNTY )
Personally came before me this 6th day of November, 1996, the above
named Rod Lanser, County Clerk of Milwaukee County, to me known to be the
person who executed the foregoing instrument on behalf of Milwaukee
County, and acknowledged the same to be the free act and deed of said
County made by its authority.
/s/ Mark E. Ryan
Notary Public, Milwaukee County, Wis.
My commission expires 10/15/00
<PAGE>
STATE OF WISCONSIN )
) ss
COUNTY OF MILWAUKEE )
Personally came before me this 15th day of October, 1996,
Brenda Skelton, Sr. Vice President,
(Name) (Title)
and , ,
(Name) (Title)
of MIDWEST EXPRESS AIRLINES, INC., to me known to be the persons who
executed the foregoing instrument and to me known to be such officers of
said corporation, and acknowledged that they executed the foregoing
instrument as such officers as the deed of said corporation, by its
authority.
/s/ Linda C. Snyder
Notary Public, Linda C. Snyder
My commission expires 12/29/96
AMENDMENT NO. 9
TO
AIRLINE LEASE NO. AC-865
THIS CONTRACT OF LEASE is made and entered into as of the
6th day of March, 1996, by and between MILWAUKEE COUNTY, a municipal
corporation, organized and existing as one of the counties in Wisconsin
(herinafter referred to as "Lessor" or "County"), and MIDWEST EXPRESS
AIRLINES, INC., a corporation organized and existing under the laws of the
State of Delaware (hereinafter referred to as "Lessee" or "Airline").
W I T N E S S E T H:
THAT, WHEREAS, the parties hereto have heretofore entered into an
Airline Lease or Lease dated April 5, 1985, as amended, relating to space
use occupancy and the use of the premises and facilities of General
Mitchell International Airport for the transportation of persons and cargo
by air; and
WHEREAS, in 1994, Airline had requested constructing additional lower
level operation space for its flight crews on the ground floor of
Concourse "D" at General Mitchell International Airport; and,
WHEREAS, Airline also requested that its Airline Lease be amended to
include the space being constructed and that rental credits be issued to
Airline to reimburse Airline for the actual non-tenant finish portion of
the costs of improving this lower level area; and,
WHEREAS, in 1995, Airline requested to increase the scope of the
construction project and the number of square feet to be added to the
Airline Lease; and,
WHEREAS, County's Board of Supervisors in its meetings of November 3,
1994, and July 20, 1995, approved amending Airline's Lease to include the
space being constructed and issuing rental credits to reimburse Airline
for the actual non-tenant finish portion of the costs of improving the
lower level area;
NOW, THEREFORE, for and in consideration of the premises and of the
mutual covenants and agreements herein contained and other valuable
considerations, it is mutually agreed between the parties hereto that the
aforesaid agreement date April 5, 1985, as amended, be and it is hereby
further amended in the following particulars, to wit:
1. Effective on January 1, 1996, paragraph S of Article IV shall be
deleted in its entirety and a new paragraph S inserted therefore,
reading as follows:
"S. LESSEE'S EXCLUSIVE USE SPACE
WITHIN THE TERMINAL BUILDING ON JANUARY 1, 1996
For purposes of calculation of Lessee's Terminal rents for those
areas designated for Lessee's exclusive use in the Terminal
Building, the following space definitions, relative cost
factors, and resultant ERUs shall be utilized:
Relative
Space Function Sq. Ft. Cost Factor ERUs
Concourse Lower Level 191.00 .20 38.20
Office Unfinished
(Unheated)
Concourse Lower Level 3,158.00 .70 2,210.60
Office Finished
(Heated)
Concourse Lower Level 21,410.90 .85 18,199.27
Office Finished
(Heated & Air
Conditioned)
Concourse Upper Level 0 .95 0
Office Unfinished
Concourse Upper Level 1,866.45 .95 1,773.13
Office Finished
Ticket Counter 661.70 1.10 727.87
Ticket Counter Office 1,307.40 .95 1,242.03
Gate Hold Rooms 18,132.00 1.00 18,132.00
Baggage Makeup Area 3,939.10 .75 2,954.33
Baggage Service Office 304.90 1.00 304.90
Hold Room Stairwell 1,690.44 .15 253.57
Basement 0 .25 0
Mezzanine Office Areas 0 .90 0
Operations Control Tower 401.00 1.08 433.08
--------- ---------
TOTALS 53,062.89 46,268.96
The spaces outlined above are those occupied by Lessee on January 1,
1996, and as shown on Exhibit "P", pages 12 and 13 of 13 dated 1/96
attached hereto and made a part hereof."
2. Except as specifically provided herein, the terms and conditions of the
Lease heretofore entered into between the parties dated April 5, 1985,
as amended, shall remain in full force and effect.
IN WITNESS WHEREOF, the parties hereto have caused these presents to be
signed by their respective proper officers and their corporate seals
hereto affixed on the dates hereinafter set forth.
COUNTY
Dated at Milwaukee, Wisconsin, this 6th day of March, 1996.
APPROVED: MILWAUKEE COUNTY
a municipal corporation
/s/ 2/29/96 By /s/ Tyrone P. Dumas
Airport Director Date Tyrone P. Dumas
Director of Public Works
/s/ 2/27/96 By /s/ Rod Lanser
Corporation Counsel Date Rod Lanser
County Clerk
AIRLINE
Dated at , this day of
, 199 .
MIDWEST EXPRESS AIRLINES, INC.
a Delaware corporation
By /s/ Timothy E. Hoeksema
Title President
Date _________________________
By /s/ Steven J. Hartung
Title Secretary
Date _________________________
STATE OF WISCONSIN )
) ss
MILWAUKEE COUNTY )
Personally came before me this 5th day of March, 1996, the above named
Tyrone P. Dumas, Director of Public Works for Milwaukee County, to me
known to be the person who executed the foregoing instrument on behalf of
Milwaukee County, and acknowledged the same to be the free act and deed of
said County, made by its authority.
/s/ Connie Arnold
Notary Public, Milwaukee Co., Wis.
My commission expires July 28, 1996
STATE OF WISCONSIN )
) ss
MILWAUKEE COUNTY )
Personally came before me this 6th day of March, 1996, the above named Rod
Lanser, County Clerk, of Milwaukee County, to me known to be the person
who executed the foregoing instrument on behalf of Milwaukee County, and
acknowledged the same to be the free act and deed of said County, made by
its authority.
/s/ Mark E. Ryan
Notary Public, Milwaukee Co., Wis.
My commission expires 10/26/96
<PAGE>
STATE OF WISCONSIN )
) ss
COUNTY OF MILWAUKEE )
Personally came before me this 23rd day of February, 1996,
Timothy E. Hoeksema, President
(Name) (Title)
and Steven J. Hartung, Secretary
(Name) (Title)
of Midwest Express Airlines, Inc., Lessee above, to me known to
be the persons who executed the foregoing instrument and to me
known to be such officers of said corporation, and acknowledged
that they executed the foregoing instrument as such officers as
the deed of said corporation, by its authority.
/s/ Steven J. Hartung
Notary Public, Milwaukee, Wisconsin
My commission is permanent
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> MAR-31-1997
<CASH> 25,541
<SECURITIES> 0
<RECEIVABLES> 4,720
<ALLOWANCES> 265
<INVENTORY> 3,002
<CURRENT-ASSETS> 57,143
<PP&E> 135,831
<DEPRECIATION> 62,546
<TOTAL-ASSETS> 136,226
<CURRENT-LIABILITIES> 61,211
<BONDS> 0
0
0
<COMMON> 64
<OTHER-SE> 44,540
<TOTAL-LIABILITY-AND-EQUITY> 136,226
<SALES> 0
<TOTAL-REVENUES> 79,920
<CGS> 0
<TOTAL-COSTS> 73,447
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 59
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 6,769
<INCOME-TAX> 2,538
<INCOME-CONTINUING> 4,231
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 4,231
<EPS-PRIMARY> 0.67
<EPS-DILUTED> 0.67
</TABLE>
