XJT to Issue More Stock to Cover Debt

ExpressJet Holdings stockholders approved the issuance of the number of shares of its common stock as may be reasonably necessary to repurchase all of the company's outstanding 4.25 percent convertible notes due 2023 and an increase of the company's authorized common stock from 200 million shares to 400 million shares. The company continues to work with its financial advisors and hold discussions with certain holders of the convertible notes. The company is considering potential modifications to the indenture governing the notes to provide improved terms for note holders to minimize the number of shares that would be required to satisfy the company's repurchase obligations under the indenture.
ExpressJet sought stockholder approval of these proposals in order to provide greater flexibility in satisfying its repurchase obligations with respect to its convertible notes. Following approval of the proposals, the company anticipates that it would be able to satisfy its repurchase obligations entirely in shares of common stock were it to become necessary. Under the indenture governing the notes, holders may require the company to repurchase their notes on August 1, 2008, and the company has provided written notice to the trustee of its intention to pay the repurchase price wholly in shares of common stock. The company is unable to predict whether, or how many, noteholders will require it to repurchase their notes.