HOUSTON, July 27 /PRNewswire-FirstCall/ -- ExpressJet
Holdings, Inc. (NYSE: XJT), parent company of regional and charter
airline operator, ExpressJet Airlines, Inc., today announced it
successfully executed steps to improve its balance sheet including
settlement related to the remaining balance of its auction rate
securities portfolio and the first redemption of its 11.25%
Convertible Secured Notes due 2023.
ExpressJet entered into a settlement agreement related to its
ongoing auction rate securities litigation. This settlement
relates to ExpressJet's final auction rate securities balance of
approximately $1.1 million par value,
which will be sold for 90% of par value. Since October 2008, ExpressJet settled or sold its
entire $65 million (par value)
auction rate securities portfolio for approximately 88% of par
value, realizing approximately $57
million in cash. ExpressJet used proceeds from auction
rate transactions to repay its outstanding $5 million Citibank credit facility.
ExpressJet continues to focus on the balance sheet through the
redemption of its 11.25% Convertible Secured Notes due 2023.
The first redemption, which took place on July 9, 2010, resulted in the redemption of
$3.2 million in principal of its
11.25% Convertible Secured Notes due 2023. The shortfall of
$1.8 million from the previously
announced $5.0 million principal
amount redemption was due to an administrative error made by the
company's agent on the original note redemption. To correct
this error, ExpressJet delivered notice to the trustee of its
intention to redeem an additional $1.8
million in principal of its 11.25% Convertible Secured Notes
due 2023 on August 23, 2010.
The administrative error will not have a financial impact on
ExpressJet.
The company is also scheduled to complete the redemption of
additional $5.0 million in principal
of its 11.25% Convertible Secured Notes due 2023 on August 2, 2010. After completing these
redemptions, the company will have redeemed a total of $10 million of its 11.25% Convertible Secured
Notes due 2023 and ExpressJet's remaining balance on the notes will
be $33.6 million. This balance
represents the par value due to noteholders when the notes become
due August 1, 2023 and a 43%
reduction in these notes versus June 30,
2009. The early redemption of its 11.25% Convertible
Secured Notes due 2023 will save the company approximately
$1.1 million annually in interest
expense related to the notes.
After these redemptions, the remaining balance in ExpressJet's
securities repurchase program will be $11.8
million. The company expects any future purchases of
securities under the securities repurchase program to be made
periodically in the open market or in privately negotiated
transactions. This announcement is for informational purposes
only and is not an offer to purchase or sell or a solicitation of
an offer to purchase or sell, with respect to any securities.
About ExpressJet
ExpressJet Holdings operates several divisions designed to
leverage the management experience, efficiencies and economies of
scale present in its subsidiaries, including ExpressJet Airlines,
Inc. and ExpressJet Services, LLC. ExpressJet Airlines serves
134 scheduled destinations in North
America and the Caribbean
with approximately 1,200 departures per day. Operations
include capacity purchase agreements for United and Continental as
well as providing clients customized 50-seat charter options; and
supplying third-party aviation and ground handling services.
For more information, visit www.expressjet.com.
This release contains forward-looking statements. Statements
including words such as "believes," "intends," "plans,"
"anticipates, "estimates," "projects," "expects" or similar
expressions represent forward-looking statements that are based on
the Company's expectations in light of facts known by management on
the date of this release. Specifically, statements regarding
the announced partial redemption of its 11.25% Convertible Secured
Notes due 2023, ExpressJet's future results of operations,
operating costs, business prospects, growth and capital
expenditures, including plans with respect to its fleet, are
forward-looking statements. The forward-looking statements in this
release reflect the Company's plans, assumptions and expectations
about future events and are subject to uncertainties, many of which
are outside ExpressJet's control. Important factors that
could cause actual results to differ materially from the
expectations expressed or implied in the forward-looking statements
include known and unknown risks. The five key areas of the known
risks that could significantly impact the company's revenues,
operating results and capacity include: operations under the
Company's capacity purchase agreements may no longer be profitable;
charter operations and other aviation services may affect
ExpressJet's ability to operate profitably; rising costs, a global,
economic recession and the highly competitive nature of the airline
industry; the profile of the Company's current shareholders; and
regulations, including listing regulations for publicly traded
companies, and other factors. For further discussions of these
risks and others, please see the sections entitled "Risk Factors",
as well as other sections, of ExpressJet's filings with the
Securities and Exchange Commission. The events described in the
forward-looking statements might not occur or might occur to a
materially different extent than described in this release.
ExpressJet undertakes no duty to update or revise any
forward-looking statements, whether as a result of new information,
future events or otherwise.
SOURCE ExpressJet Holdings, Inc.