December 19, 2008
Mr. Andor D. Terner, Esq.
of O'MELVENY & MYERS LLP
610 Newport Center Drive, 17th Floor
Newport Beach, CA 92660-6429
SENT VIA EMAIL (email@example.com)
AND FAX (949-823-6994)
Dear Mr. Terner:
Mr. Foley asked that I respond to your Dec. 12, 2008 letter addressed to him concerning William Davidge, Terry Dayton and myself naming Mr. Foley as our proxy as we exercise our lawful rights as ALK stockholders to submit shareholder proposals to our company.
I disagree with both points you raised. Each of the three proposals sponsored by the ALK shareholders named above are duly qualified under SEC Rule 14a-8. The three of us asked Richard to be our communication-liaison proxy, which as you are aware, is our right as shareholders to seek counsel or assistance from anyone to aid in the legal exercise of our ownership rights. Over the last six years, Mr. Foley has voluntarily served in this capacity, and both Alaska Air Group, Inc. management and the staff of the U.S. SEC have accepted this arrangement.
Regarding my sponsor titled "Reforming Securities Class Actions": My proposal has a number of features that are not severable and should not be considered general in nature. The proposal to reimburse fees only applies to cases in which the waiver of the "fraud on the market" presumption would apply, just as the damages stipulation would only apply in those cases. Moreover, if the shareholders elect to adopt this resolution, the attorney's fees reimbursement is an important feature to help ensure that deterrence is maintained.
Contrary to the assertions made in your letter, I believe my proposal is consistent with Rule 14a-8 in all respects, and demand that it be included in Alaska Air Group's 2009 proxy statement as is. It is my belief that a majority would vote for it in the affirmative.
email cc: Mr. Richard Foley
Mr. William Davidge
Mr. Terry Dayton
Ms. Karen Gruen, Esq.
Mr. Adam Pritchard