sc13dza

0000950134-07-009134.txt : 20070426 0000950134-07-009134.hdr.sgml : 20070426 20070426132450 ACCESSION NUMBER: 0000950134-07-009134 CONFORMED SUBMISSION TYPE: SC 13D/A PUBLIC DOCUMENT COUNT: 4 FILED AS OF DATE: 20070426 DATE AS OF CHANGE: 20070426 GROUP MEMBERS: GREG RACZ GROUP MEMBERS: OCTAVIAN ADVISORS LP GROUP MEMBERS: OCTAVIAN ASSET MANAGEMENT LLC GROUP MEMBERS: OCTAVIAN GLOBAL PARTNERS LLC GROUP MEMBERS: OCTAVIAN MANAGEMENT LLC GROUP MEMBERS: RICHARD HUROWITZ SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: MIDWEST AIR GROUP INC CENTRAL INDEX KEY: 0000948845 STANDARD INDUSTRIAL CLASSIFICATION: AIR TRANSPORTATION, SCHEDULED [4512] IRS NUMBER: 391828757 STATE OF INCORPORATION: WI FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A SEC ACT: 1934 Act SEC FILE NUMBER: 005-44827 FILM NUMBER: 07790417 BUSINESS ADDRESS: STREET 1: 6744 S HOWELL AVE CITY: OAK CREEK STATE: WI ZIP: 53154 BUSINESS PHONE: 4147474000 FORMER COMPANY: FORMER CONFORMED NAME: MIDWEST EXPRESS HOLDINGS INC DATE OF NAME CHANGE: 19950802 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: OCTAVIAN MASTER FUND, LP CENTRAL INDEX KEY: 0001384683 IRS NUMBER: 980513051 FILING VALUES: FORM TYPE: SC 13D/A BUSINESS ADDRESS: STREET 1: C/O OCTAVIAN GLOBAL PARTNERS, LLC STREET 2: 650 MADISON AVENUE, 26TH FLOOR CITY: NEW YORK STATE: NY ZIP: 10022 BUSINESS PHONE: 212-224-9520 MAIL ADDRESS: STREET 1: C/O OCTAVIAN GLOBAL PARTNERS, LLC STREET 2: 650 MADISON AVENUE, 26TH FLOOR CITY: NEW YORK STATE: NY ZIP: 10022 SC 13D/A 1 d45933sc13dza.htm AMENDMENT TO SCHEDULE 13D sc13dza


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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 13D

Under the Securities Exchange Act of 1934
(Amendment No. 1 )*

MIDWEST AIR GROUP, INC.

(Name of Issuer)

Common Stock, par value $.01 per share

(Title of Class of Securities)

597911106

(CUSIP Number)

Octavian Management, LLC
650 Madison Avenue, 26th Floor
New York, New York 10022

(Name, Address and Telephone Number of Person Authorized to
Receive Notices and Communications)

April 26, 2007

(Date of Event Which Requires Filing of this Statement)

If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of §§240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following box. o

Note: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See §240.13d-7 for other parties to whom copies are to be sent.

* The remainder of this cover page shall be filled out for a reporting person’s initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page.

The information required on the remainder of this cover page shall not be deemed to be “filed” for the purpose of Section 18 of the Securities Exchange Act of 1934 (“Act”) or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes).


CUSIP No.		597911106	13D/A


1	NAMES OF REPORTING PERSONS: Octavian Master Fund, L.P.

	I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY):


2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS):
	(a) o
	(b) þ

3	SEC USE ONLY:



4	SOURCE OF FUNDS (SEE INSTRUCTIONS):

	WC

5	CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e):

	o

6	CITIZENSHIP OR PLACE OF ORGANIZATION:

	Cayman Islands

		7	SOLE VOTING POWER:

NUMBER OF			1,460,000

SHARES		8	SHARED VOTING POWER:
BENEFICIALLY
OWNED BY			0

EACH		9	SOLE DISPOSITIVE POWER:
REPORTING
PERSON			1,460,000

WITH		10	SHARED DISPOSITIVE POWER:

			0

11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON:

	1,460,000

12	CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS):

	o

13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11):

	5.97%

14	TYPE OF REPORTING PERSON (SEE INSTRUCTIONS):

	PN

*SEE INSTRUCTIONS BEFORE FILLING OUT


CUSIP No.		597911106	13D/A


1	NAMES OF REPORTING PERSONS: Octavian Global Partners, LLC

	I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY):


2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS):
	(a) o
	(b) þ

3	SEC USE ONLY:



4	SOURCE OF FUNDS (SEE INSTRUCTIONS):

	WC

5	CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e):

	o

6	CITIZENSHIP OR PLACE OF ORGANIZATION:

	Delaware

		7	SOLE VOTING POWER:

NUMBER OF			1,460,000

SHARES		8	SHARED VOTING POWER:
BENEFICIALLY
OWNED BY			0

EACH		9	SOLE DISPOSITIVE POWER:
REPORTING
PERSON			1,460,000

WITH		10	SHARED DISPOSITIVE POWER:

			0

11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON:

	1,460,000

12	CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS):

	o

13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11):

	5.97%

14	TYPE OF REPORTING PERSON (SEE INSTRUCTIONS):

	OO

*SEE INSTRUCTIONS BEFORE FILLING OUT


CUSIP No.		597911106	13D/A


1	NAMES OF REPORTING PERSONS: Octavian Management, LLC

	I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY):


2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS):
	(a) o
	(b) þ

3	SEC USE ONLY:



4	SOURCE OF FUNDS (SEE INSTRUCTIONS):

	WC

5	CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e):

	o

6	CITIZENSHIP OR PLACE OF ORGANIZATION:

	Delaware

		7	SOLE VOTING POWER:

NUMBER OF			1,460,000

SHARES		8	SHARED VOTING POWER:
BENEFICIALLY
OWNED BY			0

EACH		9	SOLE DISPOSITIVE POWER:
REPORTING
PERSON			1,460,000

WITH		10	SHARED DISPOSITIVE POWER:

			0

11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON:

	1,460,000

12	CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS):

	o

13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11):

	5.97%

14	TYPE OF REPORTING PERSON (SEE INSTRUCTIONS):

	OO

*SEE INSTRUCTIONS BEFORE FILLING OUT


CUSIP No.		597911106	13D/A


1	NAMES OF REPORTING PERSONS: Octavian Advisors, LP

	I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY):


2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS):
	(a) o
	(b) þ

3	SEC USE ONLY:



4	SOURCE OF FUNDS (SEE INSTRUCTIONS):

	WC

5	CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e):

	o

6	CITIZENSHIP OR PLACE OF ORGANIZATION:

	Delaware

		7	SOLE VOTING POWER:

NUMBER OF			1,460,000

SHARES		8	SHARED VOTING POWER:
BENEFICIALLY
OWNED BY			0

EACH		9	SOLE DISPOSITIVE POWER:
REPORTING
PERSON			1,460,000

WITH		10	SHARED DISPOSITIVE POWER:

			0

11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON:

	1,460,000

12	CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS):

	o

13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11):

	5.97%

14	TYPE OF REPORTING PERSON (SEE INSTRUCTIONS):

	PN

*SEE INSTRUCTIONS BEFORE FILLING OUT


CUSIP No.		597911106	13D/A


1	NAMES OF REPORTING PERSONS: Octavian Asset Management, LLC

	I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY):


2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS):
	(a) o
	(b) þ

3	SEC USE ONLY:



4	SOURCE OF FUNDS (SEE INSTRUCTIONS):

	WC

5	CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e):

	o

6	CITIZENSHIP OR PLACE OF ORGANIZATION:

	Delaware

		7	SOLE VOTING POWER:

NUMBER OF			1,460,000

SHARES		8	SHARED VOTING POWER:
BENEFICIALLY
OWNED BY			0

EACH		9	SOLE DISPOSITIVE POWER:
REPORTING
PERSON			1,460,000

WITH		10	SHARED DISPOSITIVE POWER:

			0

11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON:

	1,460,000

12	CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS):

	o

13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11):

	5.97%

14	TYPE OF REPORTING PERSON (SEE INSTRUCTIONS):

	OO

*SEE INSTRUCTIONS BEFORE FILLING OUT


CUSIP No.		597911106	13D/A


1	NAMES OF REPORTING PERSONS: Greg Racz

	I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY):


2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS):
	(a) o
	(b) þ

3	SEC USE ONLY:



4	SOURCE OF FUNDS (SEE INSTRUCTIONS):

	WC

5	CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e):

	o

6	CITIZENSHIP OR PLACE OF ORGANIZATION:

	United States

		7	SOLE VOTING POWER:

NUMBER OF			1,460,000

SHARES		8	SHARED VOTING POWER:
BENEFICIALLY
OWNED BY			0

EACH		9	SOLE DISPOSITIVE POWER:
REPORTING
PERSON			1,460,000

WITH		10	SHARED DISPOSITIVE POWER:

			0

11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON:

	1,460,000

12	CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS):

	o

13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11):

	5.97%

14	TYPE OF REPORTING PERSON (SEE INSTRUCTIONS):

	IN

*SEE INSTRUCTIONS BEFORE FILLING OUT


CUSIP No.		597911106	13D/A


1	NAMES OF REPORTING PERSONS: Richard Hurowitz

	I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY):


2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS):
	(a) o
	(b) þ

3	SEC USE ONLY:



4	SOURCE OF FUNDS (SEE INSTRUCTIONS):

	WC

5	CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e):

	o

6	CITIZENSHIP OR PLACE OF ORGANIZATION:

	United States

		7	SOLE VOTING POWER:

NUMBER OF			1,460,000

SHARES		8	SHARED VOTING POWER:
BENEFICIALLY
OWNED BY			0

EACH		9	SOLE DISPOSITIVE POWER:
REPORTING
PERSON			1,460,000

WITH		10	SHARED DISPOSITIVE POWER:

			0

11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON:

	1,460,000

12	CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS):

	o

13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11):

	5.97%

14	TYPE OF REPORTING PERSON (SEE INSTRUCTIONS):

	IN

*SEE INSTRUCTIONS BEFORE FILLING OUT

SCHEDULE 13D/A

This Amendment No. 1 (“Amendment”) to Schedule 13D (the “Schedule 13D”), relating to shares of Common Stock, par value $0.01 per share (the “Shares”), of Midwest Air Group, Inc. (the “Issuer ”), is being filed with the Securities and Exchange Commission on behalf of (i) Octavian Master Fund, L.P., a Cayman Islands limited partnership (“Octavian Master”); (ii) Octavian Global Partners, LLC, a Delaware limited liability company and general partner of Octavian Master (“Octavian Partners”); (iii) Octavian Management, LLC, a Delaware limited liability company and managing member of Octavian Partners (“Octavian Management”); (iv) Octavian Advisors, LP, a Delaware limited partnership and investment manager of Octavian Master (“Octavian Advisors”); (v) Octavian Asset Management, LLC, a Delaware limited liability company and general partner of Octavian Advisors (“Octavian Asset Management”); (vi) Mr. Greg Racz, a managing member of Octavian Management and Octavian Asset Management (“Mr. Racz”); and (vii) Mr. Richard Hurowitz, a managing member of Octavian Management and Octavian Asset Management (“Mr. Hurowitz” and together with those persons listed in (i)-(vi) above, the “Reporting Persons”).

This Amendment is being filed to amend and restate Items 3, 4, 5 and 7 as follows:

Item 3. Source and Amount of Funds

As of the date hereof, the Reporting Persons have invested in Shares of the Issuer in the amount of: $19,616,256.10. Currently, all Shares of the Issuer as of the date hereof are held by Octavian Master. The above amount includes any commissions incurred in making the investments. The source of these funds was the working capital of the Reporting Persons.

Item 4. Purpose of the Transaction

On April 26, 2007, the Reporting Persons sent a letter to management of the Issuer relating to a proposal from AirTran Airways, Inc. to combine the two companies. A copy of the April 26, 2007 letter is attached as Exhibit 3.

The Reporting Persons purchased the Shares based on the belief that such securities, when purchased, were undervalued and represented an attractive investment opportunity. Although Reporting Person has no specific plan or proposal to acquire additional Shares or dispose of the Shares, consistent with its investment purpose, Reporting Person at any time and from time to time may acquire additional Shares or dispose of any or all of its Shares depending upon an ongoing evaluation of the investment in the Shares, prevailing market conditions, other investment opportunities, liquidity requirements of the Reporting Person and/or other investment considerations The purpose of the acquisition of the Shares is for investment, and the acquisitions of the Shares were made in the ordinary course of business and were not made for the purpose of acquiring control of the Issuer.

Also, consistent with the investment purpose, the Reporting Persons may engage in communications with one or more shareholders of the Issuer, one or more officers of the Issuer and/or one or more members of the board of directors of the Issuer and/or one or more representatives of the Issuer regarding the Issuer, including but not limited to AirTran’s proposal to the Issuer, as described above.

Except to the extent the foregoing may be deemed a plan or proposal, Reporting Person has no plans or proposals which relate to, or could result in, any of the matters referred to in paragraphs (a) through (j), inclusive, of the instructions to Item 4 of Schedule 13D. The Reporting Person may, at any time and from time to time, review or reconsider its position and/or change its purpose and/or formulate plans or proposals with respect thereto.

Item 5. Interest in Securities of the Issuer

(a) As of the date hereof, the Reporting Persons beneficially own 1,460,000 Shares of the Issuer, which represents 5.97% of the Issuer’s outstanding Shares, which such percentage was calculated by dividing (i) the 1,460,000 Shares beneficially owned by the Reporting Persons as of the date hereof, by (ii) 24,468,046 Shares outstanding as of April 16, 2007, based upon the Issuer’s most recent Form 10-Q filed with the Securities and Exchange Commission on April 26, 2007.

(b) The Reporting Persons have the power to vote and dispose of the 1,460,000 Shares held by Octavian Master.

The filing of this statement on Schedule 13D shall not be construed as an admission that any of the Reporting Persons is for the purposes of Section 13(d) or 13(g) of the Securities Exchange Act of 1934, as amended, the beneficial owner of any of the 1,460,000 Shares held by Octavian Master. Pursuant to Rule 13d-4, each of the Reporting Persons disclaim all such beneficial ownership.

(c) The transactions in the Issuer’s securities by the Reporting Persons during the sixty days prior to the obligation to file this Schedule 13D are listed as Exhibit 2 attached hereto and made a part hereof.

(d) Not Applicable.

(e) Not Applicable.

Item 7. Material to be Filed as Exhibits


Exhibit 1		Joint Filing Agreement by and among the Reporting Persons.

Exhibit 2		Transactions in the Issuer’s securities by the Reporting Persons in the sixty days prior to the obligation to file this Schedule 13D.

Exhibit 3		A copy of the April 26, 2007 letter sent by the Reporting Persons to the Issuer.

Signature

After reasonable inquiry and to the best of my knowledge and belief, the undersigned certifies that the information set forth in this statement is true, complete and correct.

Dated: April 26, 2007


	OCTAVIAN MASTER FUND, L.P.
	By:	Octavian Global Partners, LLC
	General Partner



	By:	Octavian Management, LLC
	Managing Member



	By:	/s/ Greg Racz
	Name:	Greg Racz
	Title:	President & Chief Operating Officer

	OCTAVIAN GLOBAL PARTNERS, LLC
	By:	Octavian Management, LLC
	Managing Member



	By:	/s/ Greg Racz
	Name:	Greg Racz
	Title:	President & Chief Operating Officer

	OCTAVIAN MANAGEMENT LLC
	By:	/s/ Greg Racz
	Name:	Greg Racz
	Title:	President & Chief Operating Officer

	OCTAVIAN ADVISORS, LP
	By:	Octavian Asset Management, LLC,
	General Partner



	By:	/s/ Greg Racz
	Name:	Greg Racz
	Title:	President & Chief Operating Officer


	OCTAVIAN ASSET MANAGEMENT LLC
	By:	/s/ Greg Racz
	Name:	Greg Racz
	Title:	President & Chief Operating Officer


	/s/ Greg Racz
	Greg Racz



	/s/ Richard Hurowitz
	Richard Hurowitz

EX-99.1 2 d45933exv99w1.htm JOINT FILING AGREEMENT exv99w1

EXHIBIT 1

JOINT FILING AGREEMENT

In accordance with Rule 13d-1(k) under the Securities Exchange Act of 1934, as amended, the undersigned agree to the joint filing on behalf of each of them of a Statement on Schedule 13D (including any and all amendments thereto) with respect to the Shares of Midwest Air Group, Inc., and further agree that this Joint Filing Agreement shall be included as an Exhibit to such joint filings.

The undersigned further agree that each party hereto is responsible for the timely filing of such Statement on Schedule 13D and any amendments thereto, and for the accuracy and completeness of the information concerning such party contained therein; provided, however, that no party is responsible for the accuracy or completeness of the information concerning any other party, unless such party knows or has reason to believe that such information is inaccurate.

This Joint Filing Agreement may be signed in counterparts with the same effect as if the signature on each counterpart were upon the same instrument.

IN WITNESS WHEREOF, the undersigned have executed this Agreement as of April 26, 2007


	OCTAVIAN MASTER FUND, L.P.
	By: Octavian Global Partners, LLC
	General Partner



	By: Octavian Management, LLC
	Managing Member



	By:	/s/ Greg Racz
	Name:	Greg Racz
	Title:	President & Chief Operating Officer

	OCTAVIAN GLOBAL PARTNERS, LLC
	By: Octavian Management, LLC
	Managing Member



	By:	/s/ Greg Racz
	Name:	Greg Racz
	Title:	President & Chief Operating Officer


	OCTAVIAN MANAGEMENT LLC
	By:	/s/ Greg Racz
	Name:	Greg Racz
	Title:	President & Chief Operating Officer

	OCTAVIAN ADVISORS, LP
	By: Octavian Asset Management, LLC,
	General Partner



	By:	/s/ Greg Racz
	Name:	Greg Racz
	Title:	President & Chief Operating Officer

	OCTAVIAN ASSET MANAGEMENT LLC
	By:	/s/ Greg Racz
	Name:	Greg Racz
	Title:	President & Chief Operating Officer


	/s/ Greg Racz
	Greg Racz



	/s/ Richard Hurowitz
	Richard Hurowitz

EX-99.2 3 d45933exv99w2.htm TRANSACTIONS IN THE ISSUER'S SECURITIES BY THE REPORTING PERSONS exv99w2

EXHIBIT 2


	Number of Shares
Transaction Date	Purchased/(Sold)	Price Per Share
3/26/07	3,400	$12.645

4/2/07	28,800	$14.377

4/3/07	21,200	$14.498

4/4/07	44,600	$14.285

4/10/07	20,000	$14.488

4/11/07	5,000	$14.500

4/11/07	25,000	$14.689

4/13/07	50,000	$14.362

4/17/07	10,000	$14.215

4/23/07	10,000	$13.670

4/24/07	17,000	$13.501

4/25/07	23,000	$13.809

EX-99.3 4 d45933exv99w3.htm A COPY OF THE LETTER SENT TO THE ISSUER exv99w3

EXHIBIT 3

April 26, 2007

Mr. Timothy E. Hoeksema
Chairman of the Board and Chief Executive Officer
Midwest Air Group, Inc.
6744 South Howell Avenue
Oak Creek, WI 53154

Dear Tim,

We are extremely disappointed by the board of directors’ decision to reject the latest offer from AirTran without engaging in a meaningful dialogue. We continue to believe that a strategic combination of Midwest and AirTran is extremely compelling and that, in light of AirTran’s materially increased offer, both sides should now come together for good faith negotiations. We believe that most shareholders share our view and once again urge you and your board to immediately enter into constructive talks with AirTran.

We have followed very closely the unfortunate rhetoric from both sides. We have repeatedly called on both Midwest and AirTran to put aside emotion and come together to address constructively the many issues surrounding the integration of the two airlines, including a combination of the companies’ management teams. Yet we have recently detected a tone among Midwest’s spokesmen that might indicate a lack of willingness to engage in discussions with AirTran under any circumstances. Indeed, the “save the cookie” campaign that has recently been launched begs the question as to what exactly the company is being saved from and for whose benefit. In fact, the very rationale behind putting the two companies together is to roll out best practices (including perhaps freshly baked chocolate chip cookies) from each airline, a goal much better served through a consensual transaction rather than by scorched earth tactics.

In light of this dynamic, we are becoming more and more concerned about corporate governance issues at Midwest. We do not believe that the current legal framework and corporate structure is appropriate for a world class corporation like Midwest. Indeed, it is a virtual checklist of criteria considered undesirable by most experts in the field:

• a poison pill

• a staggered board

• an anti-takeover provision

• supermajority requirements to amend key provisions of the corporation’s governing documents

• a golden parachute

• a lack of separation of the role of chairman and chief executive officer

We were also dismayed to learn that the Securities and Exchange Commission apparently had to intervene to make sure adequate notice was given to shareholders of the upcoming annual meeting and that the company has been reluctant to turn over the list of its shareholders to AirTran.

We have carefully reviewed the response by the board to AirTran’s proposal and are surprised by the lack of disclosure provided. This is even more disturbing given that Midwest simultaneously lowered its earnings guidance by nearly twenty percent. We are concerned that there is now a disconnect between management and the board of directors on the one hand and the majority of shareholders on the other. It is clear that most shareholders desire an immediate dialogue with AirTran. Yet Midwest has chosen to dismiss AirTran’s latest proposal with a breathtaking nonchalance. From the very limited disclosure related to the board’s position, it appears that its members chose to rely on a mere oral opinion from Goldman Sachs that AirTran’s latest increased offer was not adequate, even as the company dramatically reduced its earnings approximately one hundred days into the year. Two of Midwest’s board members apparently did not bother to attend the meeting to discuss the company’s response, even telephonically.

We also were surprised by the declaration, with no elaboration, that AirTran’s plan to operate the combined company is not “credible”. From the plans and commitments that we have reviewed, it seems that AirTran is not only likely to dramatically increase traffic to Milwaukee by making it into a feeder hub but also is projected to generate almost $1 billion of new benefits for the local economy and an additional $500 million for Kansas City. Moreover, it seems clear to airline industry observers that your employees would be far better off as part of a larger enterprise. Pilots, for example, would have greater opportunity for quicker advancement and flight attendants would have more flexibility in schedules. Your employees would benefit from being part of a larger company that can better handle the volatility endemic to the industry.

As you stated eloquently in the company’s April 13 press release, “Midwest shareholders” are “the true owners of the company.” Octavian is for shareholder democracy and for the right of the owners of a company to determine its future. It is now time for there to be an honest and open debate about the proposal from AirTran. We call upon the board of Midwest to immediately remove the company’s poison pill and other defenses and allow the future of the company to be put to a vote amongst its owners, the shareholders. We do not understand at this point the purpose of this arsenal other than to disenfranchise the company’s shareholders. We also put the company on notice that any further aggressive defensive measures on the part of Midwest, such as expanding the size of the board, would not be taken lightly by shareholders and would be viewed as an act of entrenchment. We believe that Goldman Sachs’ “inadequacy” opinion and the work underlying it should be disclosed to shareholders so that the owners of the company can have the benefit of the full analysis in making their decisions how to vote at the upcoming annual meeting and whether to tender their stock into AirTran’s exchange offer. We also call upon Midwest to commission a written fairness opinion on behalf of its own shareholders from an independent investment bank.

If the board of directors and management team of Midwest feel this strongly about a business plan which has never been disclosed to shareholders and are determined not to follow the will of the owners of the airline, we believe that they should find a more appropriate stockholder base by offering to take the company private at the same price as the AirTran offer. We believe that instead forcing a proxy contest that Midwest could very well lose does nothing more than undermine the company’s credibility and negotiating position.

As we have said many times, we believe you have built a great and innovative airline. However, we do not believe that the current entrenched stance taken by the Midwest team befits the culture and tradition of the business. Moreover, given the competitive risks facing Midwest, we believe that it is not responsible to ignore a transaction that will provide far greater stability and better long-term prospects for the airline. We continue to believe that a negotiated transaction with AirTran offers a unique opportunity to realize exceptional shareholder value and to create an extraordinary airline for Midwest’s customers, employees and other stakeholders.

Sincerely,

Richard Hurowitz
Chief Executive Officer

cc: Midwest Board of Directors