1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 11-K
(X) ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934 (FEE REQUIRED)
FOR THE FISCAL YEAR ENDED September 30, 2000
or
( ) TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934 (NO FEE REQUIRED)
For the transition period from ___________________
Commission file number 0-15495
MESA AIR GROUP, INC. 401(k) PLAN
(Full title of the plan)
Address of the plan
MESA AIR GROUP, INC.
(Name of issuer of the securities held pursuant to the plan)
410 North 44th Street, Suite 700
Phoenix, Arizona 85008
(Address of issuer's principal executive office)
2
MESA AIR GROUP, INC. 401(k) PLAN
INDEPENDENT AUDITORS' REPORT
FINANCIAL STATEMENTS
Years Ended September 30, 2000 and 1999,
Supplemental Schedule
As of September 30, 2000
3
MESA AIR GROUP, INC. 401(k) PLAN
TABLE OF CONTENTS
--------------------------------------------------------------------------------
PAGE
INDEPENDENT AUDITORS' REPORT 1
FINANCIAL STATEMENTS AS OF AND FOR THE YEARS
ENDED SEPTEMBER 30, 2000 AND 1999:
Statements of Net Assets Available for Benefits 2
Statements of Changes in Net Assets Available for Benefits 3
Notes to Financial Statements 4 - 6
SUPPLEMENTAL SCHEDULE AS OF SEPTEMBER 30, 2000 -
Schedule of Assets Held for Investment Purposes at End of Year 7
4
INDEPENDENT AUDITORS' REPORT
Trustee and Plan Participants
Mesa Air Group, Inc. 401(k) Plan
Phoenix, Arizona
We have audited the accompanying statements of net assets available for benefits
of the Mesa Air Group Inc. 401(k) Plan as of September 30, 2000 and 1999, and
the related statements of changes in net assets available for benefits for the
years then ended. These financial statements are the responsibility of the
Plan's management. Our responsibility is to express an opinion on these
financial statements based on our audits.
We conducted our audits in accordance with auditing standards generally accepted
in the United States of America. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, such financial statements present fairly, in all material
respects, the net assets available for benefits of the Plan as of September 30,
2000 and 1999, and the changes in net assets available for benefits for the
years then ended in conformity with accounting principles generally accepted in
the United States of America.
Our audits were conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedule listed in the
Table of Contents is presented for the purpose of additional analysis and is not
a required part of the basic financial statements, but is supplementary
information required by the Department of Labor's Rules and Regulations for
Reporting and Disclosure under the Employee Retirement Income Security Act of
1974. The schedule is the responsibility of the Plan's management. Such schedule
has been subjected to the auditing procedures applied in our audit of the basic
2000 financial statements and, in our opinion, is fairly stated in all material
respects when considered in relation to the basic financial statements taken as
a whole.
DELOITTE & TOUCHE LLP
Phoenix, Arizona
February 26, 2001
5
MESA AIR GROUP, INC. 401(k) PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
SEPTEMBER 30, 2000 AND 1999
-------------------------------------------------------------------------------
ASSETS 2000 1999
INVESTMENTS:
Investments at fair value $24,906,500 $19,649,080
Participant loans 562,576 507,142
----------- -----------
Total investments 25,469,076 20,156,222
----------- -----------
CONTRIBUTIONS RECEIVABLE:
Employee 285,471 225,153
Employer 118,084 96,806
----------- -----------
Total contributions receivable 403,555 321,959
----------- -----------
LIABILITIES 3,122
----------- -----------
NET ASSETS AVAILABLE FOR BENEFITS $25,872,631 $20,475,059
=========== ===========
See notes to financial statements.
-2-
6
MESA AIR GROUP, INC. 401(k) PLAN
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
YEARS ENDED SEPTEMBER 30, 2000 AND 1999
--------------------------------------------------------------------------------
2000 1999
ADDITIONS:
Investment income:
Interest and dividends $ 2,008,890 $ 1,055,585
Net appreciation in fair value of investments 3,360,520 3,446,277
------------ ------------
Total investment income 5,369,410 4,501,862
------------ ------------
Contributions:
Employee 3,028,268 2,915,943
Employer 1,269,036 1,213,467
------------ ------------
Total contributions 4,297,304 4,129,410
------------ ------------
Total additions 9,666,714 8,631,272
DEDUCTIONS - Benefits paid to participants (4,269,142) (3,206,562)
------------ ------------
NET INCREASE 5,397,572 5,424,710
NET ASSETS AVAILABLE FOR BENEFITS,
BEGINNING OF YEAR 20,475,059 15,050,349
------------ ------------
NET ASSETS AVAILABLE FOR BENEFITS,
END OF YEAR $ 25,872,631 $ 20,475,059
============ ============
See notes to financial statements.
-3-
7
MESA AIR GROUP, INC. 401(k) PLAN
NOTES TO FINANCIAL STATEMENTS
YEARS ENDED SEPTEMBER 30, 2000 AND 1999
--------------------------------------------------------------------------------
1. DESCRIPTION OF THE PLAN
The following description of the Mesa Air Group, Inc. 401(k) Plan (the
"Plan") provides only general information. Participants should refer to
the Plan agreement for a more complete description of the Plan's
provisions.
a. General - The Plan is a defined contribution plan sponsored by Mesa
Air Group, Inc. (the "Employer"). Under the provisions of the Plan,
as amended, union and nonunion employees of the Employer and its
affiliates, other than West Air Holding, Inc. and CC Air, Inc., who
are 21 years of age and have completed one year of service are
eligible to participate. The Plan is subject to the provisions of
the Employee Retirement Income Security Act of 1974 ("ERISA").
Employees may elect to allocate their contributions and their share
of Employer contributions to various investment options as specified
in the Plan.
b. Contributions and Vesting - Various accounts have been established
for pre-tax voluntary employee contributions, forfeitures and
earnings or losses from Plan assets. Accounts in use and their major
provisions are as follows:
- Employee Contribution Account - Salary Reduction Contribution
Accounts have been established for pre-tax voluntary employee
contributions ranging from 1 percent to 15 percent of employee
compensation up to the annual deferral limit set by the
Internal Revenue Code ("IRC"). All such balances are fully
vested.
- Employer Contributions Account - Contributions to this account
are at the discretion of the Employer. Employer contributions
currently match 50 percent of participant contributions up to
10 percent of compensation. In addition, the Employer may
contribute to the Plan a discretionary amount as determined by
the Employer's Board of Directors as a profit sharing
contribution. Employer discretionary contributions are
allocated to active participants based upon the ratio that
each participant's annual compensation bears to the total of
all active participants' annual compensation. Forfeitures are
reallocated as additional Employer matching contributions.
- Employees are 20 percent vested in Employer contribution
accounts after 3 years of service. Vesting subsequently
increases 20 percent per year until the participant becomes
fully vested. Participants also become fully vested upon
becoming disabled, reaching age 65, or death if still employed
by Mesa Air Group, Inc.
c. Participant Accounts - Each participant's account is credited with
the participant's contribution, the employer's matching
contribution, and an allocation of the employer's discretionary
contribution and the Plan's earnings. The Employer's discretionary
contribution is allocated to each participant in the ratio that each
such participant's basic contribution (up to 4 percent) for the Plan
year bears to all basic contributions of all participants. The
Plan's earnings are allocated to each participant in the ratio that
each such participant's account balance for each fund bears to the
total balance in that fund of all eligible participants on the date
of each such allocation.
-4-
8
d. Investment Options - As of September 30, 2000, participants may
direct employee contributions in 1 percent increments in any of six
investment options offered by Putnam and a fund that invests in Mesa
Air Group, Inc. common stock.
e. Payment of benefits is available upon retirement, death, disability
or termination. Benefits are paid in the form of a lump-sum payment,
installments or a nontransferable annuity. Participants may withdraw
amounts from their account as set forth in the provisions of the
Plan document for certain hardship situations.
f. Participant Loans - Participants may borrow from their accounts a
minimum of $1,000 and a maximum equal to the lesser of $50,000,
reduced by the highest outstanding loan balance during the preceding
twelve months, or 50 percent of their vested benefits. Loan terms
range from one through five years unless funds are used to purchase
a primary residence. The loans are secured by the balance in the
participant's account. The loans accrue interest at a fixed rate
determined by the Plan Administrator. The rate will be comparable to
those currently available from commercial institutions. Interest
rates range from 7 percent to 9.25 percent. Principal and interest
are payable through monthly payroll deductions.
g. Plan Termination - Although it has not expressed any intent to do
so, the Employer has the right under the Plan to discontinue its
contributions at any time and to terminate the Plan subject to prior
approval of the Internal Revenue Service and the Department of
Labor. Upon complete discontinuance of contributions under the Plan,
all employees' rights are non-forfeitable.
h. Tax Status - The Internal Revenue Service has determined and
informed the Employer by letter dated December 23, 1998 that the
Plan and related trust are designed in accordance with applicable
sections of the IRC. The Plan has been amended since receiving the
determination letter; however, the Plan Administrator believes the
Plan is designed and is currently being operated in compliance with
the applicable requirements of the IRC.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The Plan prepares its financial statements in accordance with accounting
principles generally accepted in the United States of America. Significant
accounting policies are as follows:
a. Basis of Accounting - The accompanying financial statements of the
Plan have been prepared in accordance with accounting principles
generally accepted in the United States of America using the accrual
basis of accounting.
b. Use of Estimates - The preparation of financial statements in
conformity with accounting principles generally accepted in the
United States of America requires the Plan Administrator to make
estimates and assumptions that affect the reported amounts of net
assets available for benefits and changes therein, and disclosure of
contingent assets and liabilities. Actual results could differ from
those estimates.
c. Investment Valuation - Mutual fund investments and Mesa Airlines
Group, Inc. common stock are stated at market value based upon
quoted market prices as determined by the Plan Trustee. Participant
loans are valued at cost, which approximates fair value. Purchases
and sales are recorded on a trade-date basis. Dividends are recorded
on the ex-dividend date.
d. Administrative Expenses - All administrative expenses are paid by
the Employer.
e. Payment of Benefits - Benefits are recorded when paid.
-5-
9
3. INVESTMENTS
The following presents investments that represent five percent or more of
the Plan's net assets.
2000 1999
PUTNAM FIDUCIARY TRUST COMPANY
Putnam Money Market Fund $1,583,661 $1,481,749
Putnam Growth and Income Fund 3,797,321 4,036,641
Putnam Global Growth Fund 2,391,972 1,834,384
Putnam Voyager Fund 7,574,009 6,032,625
Putnam New Opportunities 7,725,566 4,643,236
During the years ended September 30, 2000 and 1999, the Plan's investments
(including investments bought and sold, as well as held during the year)
appreciated by $3,360,520 and $3,446,277, respectively.
4. RELATED-PARTY TRANSACTIONS
Certain Plan investments are shares of mutual funds managed by Putnam
Fiduciary Trust Company ("Putnam"). Putnam is the Trustee as defined in
the Plan; therefore, these transactions qualify as party-in-interest
transactions.
* * * * *
-6-
10
MESA AIR GROUP INC. 401(k) PLAN
SUPPLEMENTAL SCHEDULE
SEPTEMBER 30, 2000
--------------------------------------------------------------------------------
SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES AT END OF YEAR
COLUMN B COLUMN C COLUMN E
------------------------------ ------------------------------------------- -------------
IDENTITY OF ISSUER, DESCRIPTION OF INVESTMENT
ISSUER, BORROWER, INCLUDING MATURITY DATE,
LESSOR OR RATE OF INTEREST, COLLATERAL, CURRENT
SIMILAR PARTY PAR OR MATURITY VALUE VALUE
------------------------------ ------------------------------------------- -------------
Putnam Fiduciary Trust Company Voyager Fund - 250,795.009 shares $ 7,574,009
Putnam Fiduciary Trust Company Growth and Income Fund - 198,604.652 shares 3,797,321
Putnam Fiduciary Trust Company New Opportunities - 82,073.372 shares 7,725,566
Putnam Fiduciary Trust Company Money Market Fund - 1,583,660.502 shares 1,583,661
Putnam Fiduciary Trust Company Income Fund Portfolio - 113,848.161 shares 720,659
Putnam Fiduciary Trust Company Global Growth Fund - 152,064.346 shares 2,391,972
Mesa Airlines, Inc. Common stock - 203,576.978 shares 1,113,312
Participant loans Maturing from 2001 to 2005, with interest
rates ranging from 7.00% to 9.25% 562,576
-----------
Total assets held for investment purposes $25,469,076
===========
-7-
11
SIGNATURES
The Plan, pursuant to the requirements of the Securities Exchange Act of
1934, the Trustees (or other persons who administer the employee benefit plan)
have duly caused this Annual Report to be signed on its behalf by the
undersigned hereunto duly authorized.
PUTNAM INVESTMENTS
Dated: March 29, 2001 By: /s/ Justine M. Woodard
---------------- --------------------------------
Justine M. Woodard
12
EXHIBIT INDEX
Exhibit
Number Description of Exhibit
------ ----------------------
23 Independent Auditors' Consent