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Good evening. This is APFA President John Ward with an important update; it’s February 12, 2003.

The APFA Board of Directors has been meeting in special session this week to consider the important issues presented by the Company’s announced financial situation and its demand that the employees of American agree to a “permanent annual” reduction in labor costs of $1.8 billion, including $340 million in “annual permanent” reductions by the APFA-represented flight attendants. The Board received a thorough briefing and analysis from APFA’s financial and legal advisors and a presentation from members of the APFA Negotiating Committee.

We all realize how hard we worked and how long we waited to obtain our industry-leading contract and the Board reaffirmed the importance of doing everything possible to protect that contract. We also recognize the importance of ensuring that our Company is a viable and successful entity that, at the same time, respects the legitimate rights and expectations of the flight attendants and of other Company employees.

I am pleased to report that the Board of Directors, after carefully considering these important issues, has unanimously adopted a comprehensive, multi-faceted plan of action.

This APFA Readiness Plan includes the following basic principles:

1. APFA should be prepared to address and promptly respond to all contingencies that may arise.

2. APFA will continue to actively monitor the Company’s financial situation and related relevant information and will base its actions upon the best and most current information available.

3. If the need for relief is demonstrated to APFA’s satisfaction, the relief to be provided will be designed to address, and will be limited in scope and duration to meet, the specific demonstrated need for relief. Every effort will be made to preserve to the maximum extent possible existing terms and conditions of employment.

4. If relief is provided, pre-relief conditions must be restored as soon as there is no longer a demonstrated need for relief.

5. APFA will seek to obtain appropriate protections and relief from the Company in the event APFA determines to provide any relief to the Company.

6. Membership involvement will be a critical part of APFA’s plan of action. The membership will be kept fully informed of pertinent developments, membership input will be solicited, and membership participation will be welcomed and actively encouraged.

7. APFA recognizes the importance of coordinated, consistent efforts with its Union Coalition partners and will make every effort to facilitate and encourage such coordinated efforts.

The Board of Directors further determined to direct the APFA Negotiating Committee, under my direction, to take all necessary action, including a thorough review of the collective bargaining agreement, to be able to expeditiously address varying contingencies that may arise.

Finally, the Board reaffirmed that, if is determined at some subsequent time, based on a thorough review of the most up-to-date information, it is necessary and in the best interests of the American flight attendants to provide certain relief to the Company, it will not provide such relief without first obtaining the approval of the APFA membership.

As indicated, we will be involving the membership extensively in this effort through road shows, communications and in other ways. While I wish we were not facing the current situation, I look forward to meeting and communicating with you in the days ahead.

On a somewhat related note, there has been some mention in the press of a possible Company response to the other carriers’ announced intention to pursue so-called “airlines within their airlines.” While we understand that American is looking internally into such options, nothing concrete has been presented to APFA and, indeed, we have been informed that the Company has not yet reached any internal conclusions. Please avoid relying on rumors and speculation. We will be closely monitoring the situation, will keep you informed, and will take appropriate steps to best protect your interests.

I’d also like to update you on some recent developments with the CRAF Operation. As you’ve probably heard, the government has now activated the Civil Reserve Air Fleet, otherwise known as CRAF. CRAF language is contained in Appendix E, Part II of the contract. The Company has begun to put together the CRAF Reserve Pool from those international qualified flight attendants who submitted their names for the CRAF Systemwide Volunteer List. The APFA Board of Directors today authorized an exception to the contractual on-duty limitations contained in Appendix I, Article 7.J.1 so as to allow APFA flight attendants the ability to fly all CRAF missions, including those portions from Europe to and from the Middle East. There is much additional information regarding CRAF flying posted on the APFA web site or you may contact your Base Chair or the APFA Contract Department at Headquarters, extension 8171.

That’s it for this evening. This hotline will be updated as events warrant. Thank you for calling.

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