Frontier Airlines, Inc. Proxy Statement

DEF 14A 1 frontierproxystatement.htm FRONTIER AIRLINES PROXY STATEMENT Frontier Airlines, Inc. Proxy Statement

SCHEDULE 14A
(Rule 14a-101)
Information Required in Proxy Statement

I. SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934

Filed by the Registrant [X]

Filed by a Party other than the Registrant [ ]

Check the appropriate box:

[ ] Preliminary Proxy Statement (definitive proxy to be filed on or about July 22, 2002)
[ ] Confidential, for Use of Commission Only (as permitted by Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant toss. 240.14a-11(c) orss. 240.14a-12

FRONTIER AIRLINES, INC.
(Name of Registrant as Specified in Its Charter)

(Name of Person(s) Filing Proxy Statement if other than Registrant)

Payment of Filing Fee (Check the appropriate box):

[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11,

1) Title of each class of securities to which transaction applies:

2) Aggregate number of securities to which transaction applies:
3) Per unit price or other underlying value of transaction computed pursuant to Exchange Act
Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was
determined):
4) Proposed maximum aggregate value of transaction:
5) Total fee paid:

[ ] Fee paid previously with preliminary materials

[ ] Check box if any part of the fee is offset as provided by Exchange act Rule 0-11(a)(2) and identify the
filing for which the offsetting fee was paid previously. Identify the previous filing by registration
statement number, or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
2) Form, Schedule or Registration Statement No.:
3) Filing Party:
4) Date Filed:

FRONTIER AIRLINES, INC.
7001 Tower Road
Denver, CO 80249-7312

NOTICE OF ANNUAL MEETING OF SHAREHOLDERS

TO THE SHAREHOLDERS OF FRONTIER AIRLINES, INC.:

The 2002 annual meeting of shareholders of Frontier Airlines, Inc., a Colorado corporation, will be held
on Thursday, September 5, 2002 at 9:30 a.m. local time at the Doubletree Hotel, 3203 Quebec Street, Denver,
Colorado for the following purposes:

1. To consider and vote upon a proposal to elect Samuel D. Addoms, D. Dale Browning, Paul S. Dempsey,
William B. McNamara, B. LaRae Orullian, Jeff S. Potter, and James B. Upchurch to the Company's Board of
Directors; and

2. To transact any other business which properly comes before the meeting or any adjournment.

All shareholders of record on the Company's transfer books as of the close of business on
July 1, 2002 are entitled to vote at the meeting. A complete list of shareholders entitled to vote at the annual
meeting will be available for examination by any Company shareholder at 7001 Tower Road, Denver, Colorado
80249-7312 for purposes germane to the annual meeting, during normal business hours from July 8, 2002 until the
annual meeting.

We invite you to be present at the meeting and look forward to seeing you there. However, if
you cannot attend please read the attached proxy statement carefully and SIGN, DATE AND PROMPTLY RETURN THE
ENCLOSED PROXY CARD AUTHORIZING REPRESENTATIVES OF THE COMPANY'S MANAGEMENT TO VOTE ON YOUR BEHALF AT THE MEETING.

By order of the Board of Directors

July 15, 2002 FRONTIER AIRLINES, INC.

David Sislowski
Secretary

FRONTIER AIRLINES, INC.
7001 Tower Road
Denver, CO 80249-7312

PROXY STATEMENT

This proxy statement and accompanying proxy card support a proxy solicitation on behalf of the
Board of Directors of Frontier Airlines, Inc. (the "Company") for use at the September 5, 2002 annual meeting of
shareholders and at any adjournment of that meeting. This proxy statement and form of proxy, together with the
Company's Annual Report on Form 10-K, will be sent by mail to shareholders beginning approximately July 22, 2002.

The proxy card, when properly signed, dated and returned to the Company, will be voted by the
proxies at the annual meeting as directed. Proxy cards returned without direction about business to be
transacted at the meeting will be voted in favor of the election of Samuel D. Addoms, D. Dale Browning, Paul S.
Dempsey, William B. McNamara, B. LaRae Orullian, Jeff S. Potter and James B. Upchurch to the Board of Directors
of the Company. The proxies will use their best judgment regarding other matters that properly come before the
meeting. The Company is not aware of any matters, other then those discussed in this proxy statement, which will
be presented at the meeting.

The Company can conduct business at the meeting only if holders of a majority of the total
outstanding shares of common stock entitled to vote are present, either in person or by proxy. Abstentions will
be counted in determining whether a quorum has been reached. Broker-dealer non-votes will also be counted for
quorum purposes. Assuming a quorum exists, the affirmative vote of a majority of the shares present and entitled
to vote, excluding abstentions, is necessary to elect directors and to approve any other matters to be voted on.

Under Securities and Exchange Commission rules, boxes are provided on the proxy card for
shareholders to mark if they wish either to vote "for," or to "withhold authority" for all director nominees. To
withhold authority to vote for any individual nominee, the shareholder may strike a line through the nominee's
name on the proxy card.

REVOCABILITY OF PROXY

Execution of the enclosed form of proxy will not affect a shareholder's right to attend the
meeting and vote in person. Any shareholder giving a proxy may revoke it at any time before it is exercised by
attending the meeting and voting in person or by providing notice of revocation to the corporate secretary of the
Company at the address set forth above. Shareholders may vote all their eligible shares if they are personally
present at the meeting. When a shareholder votes at the meeting, his or her vote will revoke any proxy
previously granted by the shareholder.

EXPENSE AND MANNER OF SOLICITATION

In addition to solicitation by mail, proxies may be solicited in person or by telephone or
telegram by directors and officers of the Company who will not receive compensation for their soliciting
activities. Brokers and other nominees will solicit proxies or authorizations from beneficial owners and will be
reimbursed for their reasonable expenses of forwarding proxy material to beneficial owners. The Company will
bear all costs of the solicitation.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
OWNERS AND MANAGEMENT

As of July 1, 2002, the record date, 29,581,581 shares of the Company's common stock were
outstanding and entitled to vote at the meeting. Each share may cast one vote on each separate matter of
business properly brought before the meeting. Only shareholders of record at the close of business on July 1,
2002 may vote.

The following table sets forth certain information regarding beneficial ownership of the
Company's common stock as of July 1, 2002 by: (i) each director and nominee for director of the Company;
(ii) each named executive officer listed in the Executive Compensation Table; (iii) all directors and executive
officers as a group; and (iv) persons to the knowledge of the Company that beneficially own more than five
percent of the Company's outstanding common stock

Shares Beneficially Percentage of
Name and Address of Beneficial Owner Owned Ownership (1)
------------------------------------ ----- -------------
Directors and Named Executive Officers:
---------------------------------------
Samuel D. Addoms 348,678 (2) 1.18%
7001 Tower Road
Denver, CO 80249-7312

Paul S. Dempsey 86,000 (3) *
7001 Tower Road
Denver, CO 80249-7312

B. LaRae Orullian 35,225 *
7001 Tower Road
Denver, CO 80249-7312

William B. McNamara 20,000 (4) *
7001 Tower Road
Denver, CO 80249-7312

D. Dale Browning 45,000 *
7001 Tower Road
Denver, CO 80249-7312

James B. Upchurch 88,500 (5) *
7001 Tower Road
Denver, CO 80249-7312

William F. McKinney 6,179 (6) *
7001 Tower Road
Denver, Co 80249-7312

Arthur T. Voss 107,645 (7) *
7001 Tower Road
Denver, CO 80249-7312

Ann E. Block 27,891 (8) *
7001 Tower Road
Denver, CO 80249-7312

Jeff S. Potter 29,707 (9) *
7001 Tower Road
Denver, CO 80249-7312

All directors and executive officers 933,451 (10) 3.16%
as a group (17 persons)

Five Percent and Greater Shareholders:
-------------------------------------
FMR Corp. 3,142,336 (11) 10.62%
Edward C. Johnson 3d
Abigail P. Johnson
Fidelity Management & Research Company
82 Devonshire Street
Boston, Massachusetts 02019

Lord, Abbett & Co. 1,494,996 (12) 5.05%
90 Hudson Street
Jersey City, New Jersey 07302

-------------------------------------------------------------------------------------------------------------------

* Less than 1%
(1) Unless otherwise indicated, the Company believes that all persons named in the table have sole voting
and investment power with respect to all shares of common stock beneficially owned by them. A person is
deemed to be the beneficial owner of securities that can be acquired by such person within 60 days from
July 15, 2002 upon the exercise of options, warrants or convertible securities that are held by such
person (but not those held by any other person). This table assumes a base of 29,581,581 shares of
common stock outstanding as of July 1, 2002, before any consideration is given to other outstanding
options, warrants or convertible securities.
(2) Includes 215,416 shares held under option, all of which are currently exercisable, and 5,262 vested
shares allocated under the Company's Employee Stock Ownership Plan ("ESOP").
(3) Includes 22,500 shares held under option, all of which are currently exercisable.
(4) Includes 17,500 shares held under option, all of which are currently exercisable.
(5) Includes 45,000 shares held under option, all of which are currently exercisable.
(6) Includes 6,000 shares held under option, all of which are currently exercisable, and 179 vested shares
allocated under the ESOP.
(7) Includes 63,406 shares held under option, all of which are currently exercisable, 38,000 owned shares,
and 6,239 vested shares allocated under the ESOP. Of these, 3,000 owned shares and 1,836 vested ESOP
shares are owned by Mr. Voss's wife, as to which Mr. Voss disclaims beneficial ownership. Mr. Voss
retired as of March 31, 2002.
(8) Includes 27,000 shares held under option, all of which are currently exercisable, and 891 vested shares
allocated under the ESOP.
(9) Includes 8,000 shares held under option, all of which are currently exercisable, and 4,207 vested shares
allocated under the ESOP.
(10) Includes 404,773 owned shares, 506,072 shares held under option which are exercisable within 60 days,
and 22,606 vested shares allocated under the ESOP.
(11) Reflects beneficial ownership as of April 30, 2002. Information with respect to FMR Corp., Edward C.
Johnson 3d, Abigail P. Johnson and Fidelity Management & Research Company is based on Schedule 13G dated
May 10, 2002, as filed with the Securities and Exchange Commission.
(12) Reflects beneficial ownership as of January 16, 2002. Information with respect to Lord, Abbett & Co. is
based on Schedule 13G dated January 16, 2002, as filed with the Securities and Exchange Commission.

DIRECTORS AND EXECUTIVE OFFICERS

The following table contains the name, age and position with the Company of each executive
officer as of July 1, 2002, each director of the Company, and each nominee for director of the Company. Their
respective backgrounds are described following the table. Each of the officers devotes his or her full-time
efforts to the affairs of the Company.

Name Age Position
---- --- --------
Jeff S. Potter 42 President, Chief Executive Officer; Director; Nominee
for Director
Ann E. Block 52 Vice President - Human Resources and In-Flight
Services
Michael J. Bowers 45 Vice President - Station Operations & Customer Service
Elise R. Eberwein 37 Vice President - Communications
Ronald L. McClellan 53 Vice President - Maintenance and Engineering
William F. McKinney 62 Vice President - Flight Operations
Sean E. Menke 33 Vice President - Marketing & Planning
Elissa A. Potucek 45 Vice President, Controller and Treasurer
David Sislowski 50 Vice President - Administration and General Counsel;
Secretary
Paul H. Tate 51 Vice President - Chief Financial Officer
Samuel D. Addoms 62 Chairman, Board of Directors; Nominee for Director
D. Dale Browning 65 Director; Nominee for Director
Paul S. Dempsey 51 Director; Vice Chair; Nominee for Director
William B. McNamara 69 Director; Nominee for Director
B. LaRae Orullian 69 Director; Vice Chair; Nominee for Director
James B. Upchurch 43 Director; Nominee for Director

Jeff S. Potter rejoined the Company as Executive Vice President & Chief Operating Officer in
May 2001, and was appointed to the Board of Directors in that same month. He was appointed President of the
Company in August 2001, and became President and Chief Executive Officer of the Company upon Mr. Addoms'
retirement in April 2002. Before re-joining the Company in May 2001, he served as Chief Executive Officer of
Vanguard Airlines from May 2000 to April 2001. Prior to working for Vanguard Airlines, he was Vice President of
Marketing for the Company from 1995 to April 2000. He has over 18 years of airline and airline related
experience, including regional director of commercial marketing for McDonnell Douglas Corporation and various
positions with Pacific Southwest Airlines, Continental Airlines, Northwest Airlines, and the former Frontier
Airlines.

Ann E. Block has been Vice President-Human Resources since March 1999 and Vice President-Human
Resources and In-Flight Services since June 2000. Before joining the Company she served as Director-Human
Resources Strategy and Services for BlueCross BlueShield of Colorado. From 1971 to 1996, she served in various
capacities with Public Service Company of Colorado. From 1996-1997, she served as Director-Total Compensation
for HR Source, Inc.

Michael J. Bowers has been Vice President-Station Operations & Customer Service since August
2000. From October 1990 until August 2000 he held the position of Regional Director for Customer Service for
Horizon Air. Prior to that he was the Customer Service Manager at several stations for Alaska Airlines.

Elise R. Eberwein has served as Vice President-Communications of the Company since June 2000.
Prior to this appointment, she served as Director-Corporate Communications since joining the Company in 1998.
From 1997 through 1998, she served as Director-Corporate Communications for Western Pacific Airlines. Between
1986 and 1997, she served in various positions with Trans World Airlines, Inc., including Director, Communication
Support Services, Sales Promotion Manager, In-Flight Services New Hire Supervisor, Flight Service Manager and
Flight Attendant.

Ronald L. McClellan has been Vice President-Maintenance and Engineering for the Company since
January 2002. He has over 30 years of aviation and maintenance experience. Prior to joining the Company, Mr.
McClellan was the Vice President of Maintenance and Engineering with Kansas City based Vanguard Airlines for five
years. He was the managing director of aircraft acquisitions at TransWorld Airlines and held a number of key
aircraft maintenance positions at Continental Airlines, People Express Airlines and New Jersey based Executive
Air Fleet. Mr. McClellan served two terms in the United States Air Force, including service as a crew chief with
the USAF Thunderbirds from 1973 to 1975.

William F. McKinney has served as Vice President-Flight Operations since April 2001. Prior to
coming to the Company he was Vice President-Operations for Vanguard Airlines, a position he held from March 1996
to April 2001. Prior to Vanguard Airlines he held a variety of positions with Trans World Airlines ranging from
pilot to General Manager-Flying, Western Region (Chief Pilot), from 1967 to 1996.

Sean E. Menke has served as Vice President-Marketing & Planning of the Company since June
2000. Prior to this appointment and since joining the Company in January 1999, he served as Director-Planning
and Scheduling. He joined Frontier Airlines from United Airlines, where he served as Senior Planner, Domestic
Scheduling. From 1995 through 1998, he was employed by Western Pacific Airlines as Director, Planning and
Manager of Economic Analysis. Between 1992 and 1995, he held various positions with America West Airlines,
including Senior Analyst, Market Development; Economic Analyst and Customer Service Supervisor.

Elissa A. Potucek has been Controller/Treasurer of the Company since June 1995 and Vice
President since September 1996. From 1991 to 1995 she was Controller of Richardson Operating Company and
Richardson Production Company, an oil and gas company based in Denver, Colorado. She served from 1990 to 1991 as
Controller of Coral Companies, Inc., Denver, Colorado, having earlier held accounting positions with US West
Paging, Inc. (1988-1989), Denver, Colorado, and KPMG Peat Marwick LLP (1985-1988), Denver, Colorado.

David Sislowski joined the Company in April 2002 as Vice President-Administration, General
Counsel and Secretary. Prior to joining the Company, he was general counsel at a number of Denver-based asset
finance institutions. From 1993 to 1999, he served as Vice President & Operations Manager and Corporate Counsel
for MetLife Capital Corporation in Bellevue, Washington. He was in private practice with two Seattle-based law
firms from 1988 to 1993, where his practice concentrated on aircraft finance and asset-based structured finance.
He has almost 15 years of experience in structured finance and asset-based finance, with an emphasis in aircraft
finance, and almost 5 years of experience as general counsel.

Paul H. Tate joined the Company as Chief Financial Officer in October 2001. Prior to joining
the Company he was Executive Vice President & Chief Financial Officer for Colgan Air, Inc., a U.S. Airways
express carrier. His 20 years of aviation experience includes positions with Atlantic Coast Airlines Holdings,
Inc., where he served as Senior Vice President-Finance and Chief Financial Officer; Reno Air, Inc., where he
served as Vice President-Finance and Chief Financial Officer; and Midway Airlines, Inc., where he served as Vice
President-Information Systems and Vice President/Controller.

Samuel D. Addoms became Chairman of the Board of the Company in 2001, having previously served
as President, Chief Executive Officer, and Chief Financial Officer of the Company and as Executive Vice
President, Treasurer and a director of the Company during its early development in 1993 through September 1994,
when he was elected to the position of President. He was elected Chief Executive Officer effective January 1,
1995, and assumed the position of Chief Financial Officer upon resignation of the Company's prior Chief Financial
Officer on June 30, 2001. He retired from his executive positions in April 2002. His 40 years of management
experience include positions as President and Vice President-Finance of Monfort of Colorado, President of the
Denver National Bank and Vice President of the Continental Illinois National Bank in Chicago.

Paul S. Dempsey has been a director of the Company since July 1994 and Vice-Chair of the Board
of Directors since 1996. Professor Dempsey is Tomlinson Professor of Global Governance in Air & Space Law, and
Director of the Institute of Air & Space Law at McGill University in Montreal, Canada. Dr. Dempsey previously
served as Professor of Law and Director of the Transportation Law Program at the University of Denver in Colorado
and Director of the National Center for Intermodal Transportation. He served as Legal Advisor to the Chairman,
U.S. Interstate Commerce Commission, in 1981 and 1982; Attorney-Advisor to the former Civil Aeronautics Board's
Office of General Counsel, and its Bureau of Pricing and Domestic Aviation, 1977-1979; and Attorney-Advisor to
the Interstate Commerce Commission's Office of Proceedings, 1975-1977. Dr. Dempsey holds the following degrees:
A.B.J., J.D., University of Georgia; LL.M., George Washington University; and D.C.L., McGill University. A
Fulbright Scholar, he has authored in excess of 50 law review articles, numerous editorials for the news media
and various books on topics relating to air transportation.

B. LaRae Orullian has been a director of the Company since July 1994. She served as Chair of
the Board of Directors from 1995 to 2001, when she became Vice-Chair. A long time banker, she is Vice Chair of
the Board of Guaranty Bank, a Denver, Colorado based commercial bank, and a director of The Guaranty Corporation,
a bank holding company. She also serves on the Board of Directors and is a member of the Audit Committee of
Anthem, Inc., a publicly traded company headquartered in Indiana and doing business in several states throughout
the United States. She is on the Board of Directors of several other non-publicly traded companies in Colorado
and Utah, and is past National President and former Chair of Girl Scouts of the USA. She is currently First Vice
Chair of the World Board of Girl Guides and Girl Scouts, based in London, England. Among numerous business and
civic activities, currently she is Chair of the 2001 Easter Seal Campaign and sits on the Colorado Supreme Court
Disciplinary Hearing Board.

William B. McNamara has been a director of the Company since May 1996. A retired 35-year
airline executive specializing in financial management, he most recently served with Continental Airlines, Inc.
(1987 to 1994) as Vice President-Finance. From 1983 to 1987 he was Staff Vice President-Finance with New York
Air, Inc. Before that he served in a succession of positions with Trans World Airlines, Inc. for 22 years,
including service as Staff Vice President-Marketing Administration.

D. Dale Browning has been a director of the Company since July 1996. A long-term bank and bank
card executive, he has served since 1995 as President and Chief Executive Office of ProCard, Inc., Golden,
Colorado, and from 1993 to 1995 as a Senior Consultant to Visa International. He was President and Chief
Executive Officer of the Colorado National Bank of Denver from 1986 through 1993, having concurrently served as
Vice Chairman and Chief Operating Officer of Colorado National Bankshares and as Chief Executive Officer of Rocky
Mountain BankCard System. In 1982 he founded Plus System, Inc., an international automatic teller machine
network, and served as President of that company until 1993. Mr. Browning has served as a director of Central
States Indemnity Company of Omaha since 1995.

James B. Upchurch has been a director of the Company since October 1998. Mr. Upchurch is the
President and Chief Executive Officer of Caltius Mezzanine Partners I, LP, Caltius Mezzanine Partners II and
II-A, LP and Caltius Private Equity Partners I, LP. He actively manages the investing and lending of
approximately $270 million of capital committed to these partnerships. Mr. Upchurch is also a member of the
Boards of CampGroup, LLC and Consolidated Fire Protection, LLC.

Section 16(a) Beneficial Ownership Reporting Compliance

Section 16(a) of the Securities Exchange Act of 1934 requires the Company's directors, certain
officers and persons holding 10% of the Company's common stock to file reports with the Securities and Exchange
Commission regarding their ownership and regarding their acquisitions and dispositions of the Company's common
stock. Based solely on its review of the copies of such forms it has received, or written representations from
certain reporting persons, the Company believes that its executive officers, directors and greater than 10%
beneficial owners complied with all applicable filing requirements during the fiscal year ended March 31, 2002.

Meetings of the Board of Directors

The Company's Board of Directors met five times in the fiscal year ended March 31, 2002. All
members of the Board of Directors were in attendance at these meetings either in person or via teleconference
system that permitted each member of the Board to hear and be heard by all other members except for Ms. Orullian,
who attended four meetings.

Committees

The Company's Board of Directors has an Audit Committee, a Compensation Committee, and a
Nominating Committee.

The duties of the Audit Committee are to monitor the integrity of the Company's financial
reporting process and systems of internal control regarding finance, accounting and legal compliance, to monitor
the independence and performance of the Company's independent auditors and internal auditing department, and
to provide an avenue of communication among the independent auditors, management, the internal auditing
department, and the Board of Directors. During the fiscal year ended March 31, 2002, the members of the Audit
Committee were B. LaRae Orullian, Paul S. Dempsey, William B. McNamara, D. Dale Browning, and James B. Upchurch,
each of whom is an "independent director" as defined in Nasdaq Rule 4200(a)(14), including under revisions to the
definition of "independent director" approved by the Board of Directors of Nasdaq in May of 2002. The Audit
Committee met four times during the fiscal year. All members of the Audit Committee were present at each meeting
either in person or via teleconference system that permitted each member to hear and be heard by all other
members except for Ms. Orullian, who attended three meetings.

The duties of the Compensation Committee include recommending to the Board of Directors the
compensation to be provided to the executive officers of the Company and the grant of stock options to eligible
individuals under the Company's stock option plan. During the fiscal year ended March 31, 2002, the members of
the Compensation Committee were B. LaRae Orullian, Paul S. Dempsey, William B. McNamara, D. Dale Browning, and
James B. Upchurch. The Compensation Committee did not separately meet during the fiscal year as its functions
were preformed by action of the entire Board of Directors. However, executive officers who are also directors
did not participate in discussions regarding their individual compensation.

The duties of the Nominating Committee include the recommendation to the Board of Directors of
nominees to be proposed for election to the Board at annual meetings of shareholders and at other appropriate
times, determination of the size of the Board of Directors, and the qualifications warranting appointment as a
director. The Nominating Committee will also consider candidates for election as directors recommended by
shareholders of the Company. During the fiscal year ended March 31, 2002, the members of the Nominating
Committee were Samuel D. Addoms, B. LaRae Orullian, William B. McNamara and D. Dale Browning. The Nominating
Committee did not separately meet during the fiscal year, as its functions were performed by action of the entire
Board of Directors.

Report of the Audit Committee

The Audit Committee oversees the Company's financial reporting process on behalf of the Board
of Directors. In May 2000, the Board of Directors adopted an Audit Committee Charter setting forth the framework
under which the Audit Committee carries out its functions and duties. In accordance with the terms of the
Charter, the Audit Committee reviewed the adequacy of the Charter at a meeting held on May 15, 2002. After
review and discussion, members of the Company's Audit Committee unanimously adopted an amended and restated Audit
Committee Charter, dated as of May 15, 2002, in the form attached hereto as Appendix I.

Management has the primary responsibility for the financial statements and the reporting
process, including the systems of internal controls of the Company. In fulfilling its oversight
responsibilities, the Audit Committee reviewed the audited financial statements contained in the Annual Report
with management and discussed with management the quality and acceptability of the accounting principles, the
reasonableness of significant judgments, and the clarity of disclosures in the financial statements. In
addressing the quality of management's accounting judgments, members of the Committee asked for management's
representations that the audited financial statements of the Company have been prepared in conformity with
generally accepted accounting principles, and have expressed to management their general preference for
conservative policies when a range of accounting options is available.

The Committee reviewed with the independent auditors, who are responsible for expressing an
opinion on the conformity of the audited financial statements with generally accepted accounting principles,
their judgments as to the quality and the acceptability of the Company's accounting principles and such other
matters as are required to be discussed with the Committee under Statement on Auditing Standards No. 61. In
addition, the Committee has discussed with the independent auditors the auditors' independence from management
and the Company, including matters in the written disclosures required by the Independence Standards Board
Standard No. 1, Independent Discussions with Audit Committees, and considered the compatibility of non-audit
services with the auditors' independence.

The Committee also discussed with the Company's independent auditors, with and without
management present, the overall scope and plans for their audit. The Committee met with the independent auditors
to discuss the results of their examinations, their evaluations of the Company's internal controls, the overall
quality and the acceptability of the Company's financial reporting and other matters that the Committee believed
relevant to its oversight.

Based on these reviews and discussions, we recommend to the Board of Directors that the
Company's audited financial statements be included in the Annual Report on Form 10-K for the fiscal year ended
March 31, 2002 for filing with the Securities and Exchange Commission.

AUDIT COMMITTEE MEMBERS

B. LaRae Orullian D. Dale Browning
Paul S. Dempsey William B. McNamara
James B. Upchurch

EXECUTIVE COMPENSATION

The following table summarizes the cash and noncash compensation awarded to, earned by or paid
to the Chief Executive Officer of the Company and the top four other executive officers of the Company in the
fiscal years ended March 31, 2002, 2001, and 2000 who had total salary and bonus during fiscal year ending March
31, 2002 exceeding $100,000.

Long Term
Annual Compensation Compensation
------------------- ------------

Other Securities
Annual All Other Underlying
Name Compen- Compen- Options
and Principle sation sation SARs
Position Year Salary ($) Bonus($) ($)(1) ($)(2) Granted (#)
-------- ---- --------- -------- -------- --------- -----------

Samuel D. Addoms 2002 204,192 76,572 41,813 0 0
CEO (3) 2001 225,000 191,313 13,632 0 0
2000 172,508 87,415 4,074 0 0

Jeff S. Potter 2002 137,577 34,394 28,395 0 80,000
2001 20,000 0 1,400 16,091 0
2000 124,077 65,407 11,745 0 0

Arthur T. Voss (3) 2002 121,057 30,264 33,651 0 10,000
2001 125,000 73,782 9,377 0 0
2000 108,769 55,117 5,129 0 0

William F. McKinney 2002 120,615 30,153 5,218 40,868 30,0000
2001 0 0 0 0 0
2000 0 0 0 0 0

Ann E. Block 2002 119,173 29,793 11,884 0 30,000
2001 115,000 67,481 4,481 0 45,000
2000 95,008 48,144 3,123 0 0

(1) Other annual compensation represents (i) shares contributed to the executive officers' accounts in the
Company's Employee Stock Ownership Plan ("ESOP") as of December 31 of each of the years indicated; and
(ii) the Company's contributions to the executive officers' 401(k) accounts as of December 31 of each of
the years indicated.

As of March 31, 2001 the respective officers' ESOP accounts held the following number of shares of
common stock with corresponding values based on the closing price of the common stock on that date: Mr.
Addoms - 5,262 shares valued at $96,400; Mr. Potter - 4,207 shares valued at $77,072; Mr. Voss - 6,239
shares valued at $114,298; Mr. McKinney - 179 shares valued at $3,279; Ms. Block - 891 shares valued at
$16,323. Messrs. Addoms, Potter and Voss are 100% vested in their ESOP accounts, while Ms. Block is 60%
vested and Mr. McKinney is 20% vested.

For the calendar year ended December 31, 2001, the Company made cash contributions to the executive
officers' 401(k) accounts as follows: Mr. Addoms - $5,250; Mr. Potter - $431; Mr. Voss - $3,618; Mr.
McKinney - $1,938; Ms. Block -- $3,415.

(2) All Other Compensation includes one-time payments to executive officers, including amounts paid for
relocation expenses and tuition reimbursement, and, in the case of Mr. Potter, payment for unused
vacation upon his departure from the Company in May of 2000.

(3) Messrs. Addoms and Voss retired as officers of the Company as of April 1, 2002.

Option/SAR Grants in Last Fiscal Year

During the fiscal year ended March 31, 2002, the Company granted options to purchase shares of
its common stock to each of the Chief Executive Officer and the top four executives named above as shown in the
following table.

Percent Potential Realizable
Securities of Total Exercise Value at Assumed
Options Granted In or Base Annual Rates of Stock
SARs Fiscal Price Expiration Price Appreciation for
Name Granted Year ($/S) Date Option Term
---- -------- ---- ----- ---- -----------

5%($) 10%($)
----- ------
Jeff S. Potter 40,000 7.46% $14.35 5/1/11 360,985 914,808
40,000 7.46% $10.70 11/1/11 269,166 682,121

William F. McKinney 30,000 5.60% $13.87 4/23/11 261,683 663,156
Arthur T. Voss 10,000 1.97% $8.28 9/30/11 52,072 131,961
Ann E. Block 30,000 5.60% $15.75 5/24/11 297,152 753,043

Aggregated Option Exercises in Last Fiscal Year and Fiscal Year End Option Values

The following table sets forth certain information regarding options exercised during the
fiscal year ended March 31, 2002 by the Chief Executive Officer and other executive officers of the Company named
in the table above.

Number Value Number of Securities Value of Unexercised
on Realized Underlying Unexercised In-The-Money Options at
Name Exercise ($) Options at March 31, 2002 March 31, 2002 ($)(1)
---- -------- --- ------------------------- -----------------------
Exercisable Unexercisable Exercisable Unexercisable
----------- ------------- ----------- -------------
Samuel D. Addoms -0- -0- 208,750 60,000 3,257,564 774,180
Jeff S. Potter -0- -0- 0 80,000 0 463,600
William F. McKinney -0- -0- 0 0 300,178 182,817
Arthur T. Voss 105,000 1,208,455 63,406 30,000 821,020 387,090
Ann E. Block 9,000 55,692 36,000 66,000 420,570 428,820
-------------------------

(1) Based on the closing price of the Company's common stock on the Nasdaq National Market of $18.32 per
share on March 28, 2002.

Director Compensation

For the year ended March 31, 2002, the Company paid each director who is not a Company employee
$20,000 for serving in that capacity. Directors who are also employees of the Company receive no additional
compensation for serving as directors. The Company reimburses all of its directors for travel and out-of-pocket
expenses in connection with their attendance at meetings of the Board of Directors and Committees on which they
serve, and permits them to fly without charge on the Company's scheduled flights. The Company's outside
directors are also eligible to receive stock options under the Company's 1994 Stock Option Plan. No options were
granted to the Directors during the fiscal year ended March 31, 2002.

Samuel D. Addoms Severance Agreement

On April 1, 2002, the Company entered into a Director Compensation Agreement with Samuel D.
Addoms, Chairman of the Board of Directors and former President and Chief Executive Officer of the Company. The
agreement provides that upon Mr. Addoms' voluntary resignation as Chief Executive Officer of the Company, which
occurred on April 1, 2002, he is entitled to (a) compensation of $75,000 per year for five years as long as he
remains a member of the Company's Board of Directors, (b) a warrant to purchase 200,000 shares of the Company's
stock at a strike price of $17.00 set on April 1, 2002, which vests in three installments on the anniversary of
the grant date in each of the next three years, (c) free lifetime air travel on the Company's airline for Mr.
Addoms and his spouse, (d) such group health, life insurance and other benefits for Mr. Addoms and his eligible
dependents as are provided to, and for the same rates as, the Company's officers, and (e) continued employment by
the Company for five years at an annual salary of $25,000. In connection with this agreement Mr. Addoms agreed
not to become employed by or provide consulting services to any air carrier that competes with the Company for so
long as he remains an employee or Director of the Company. This agreement supersedes the termination agreement
executed by Mr. Addoms and the Company during the fiscal year ended March 31, 1999.

Compensation Committee Interlocks and Insider Participation

During the fiscal year ended March 31, 2002, the Company's Compensation Committee consisted of
Ms. Orullian and Messrs. Dempsey, McNamara, Browning, and Upchurch. None of the members have ever served as
employees or officers of the Company. There were no interlocking business relationships between the Company and
any member of the Compensation Committee created during the fiscal year.

Report of the Compensation Committee on Executive Compensation

Overall Policy

Salary compensation of the Company's executive officers is determined by the Compensation
Committee in conjunction with the Company's entire Board of Directors. The Committee's consideration of and
decisions regarding executive compensation are guided by a number of factors described below. The objectives of
the Company's total executive compensation package are to attract and retain executive talent, to provide an
economic framework to motivate the Company's executives to achieve goals consistent with the Company's business
strategy, to provide an identity between executive and shareholder interests through stock options and to provide
a compensation package that recognizes an executive's individual results and contributions in addition to the
Company's overall business results.

Salaries

The key elements of the Company's executive compensation consist of salary, stock options, and
bonuses. The Compensation Committee, in conjunction with the Company's entire Board of Directors, determines
salary levels of officers and employee stock option awards. Because the Compensation Committee did not intend to
target the base salary levels in effect for the executive officers at a designated percentile of the salary
levels in effect for other companies in the airline industry, there is no meaningful correlation between the
Company's salary levels and the rates of base salary in effect for those companies which are taken into account
in the Peer Group Index utilized for purposes of the stock price performance graph which follows this report.

Salaries for executive officers are determined by evaluating the responsibilities of the
position held and the experience of the individual, and by reference to the competitive marketplace for executive
talent, including a comparison of salaries for comparable positions at other airlines.

The salary levels of the executive officers of the Company for the next fiscal year are
generally established by the Compensation Committee at fiscal year-end and are reviewed and approved by the
entire Board of Directors. Specific individual performance and overall corporate or business segment performance
are reviewed in determining the compensation level of each individual officer.

Mr. Addoms' base salary as Chief Executive Officer for the fiscal year ending March 31, 2002
was $235,000 per annum. However, due to reductions in the base salary for all officers of the Company following
the terrorist attacks of September 11, 2001, the amount of Mr. Addoms' base salary actually paid during the year
was $204,192. The Compensation Committee believes that Mr. Addoms' base salary for prior years was substantially
below that of similarly situated executives in the airline industry.

Bonuses

In May 2001 the Compensation Committee and the Board of Directors adopted the Company's fiscal
year 2002 bonus plan for employees and executive officers. Under the plan, the President and Chief Executive
Officer was entitled to a bonus of up to a maximum of 75% of his base salary for the fiscal year, and other
executive officers were entitled to a bonus of up to a maximum of 50% of his or her base salary for the fiscal
year. The bonuses were to be awarded on a sliding scale based on the Company's pre-tax profit margin for the
fiscal year as set forth in the table below.

Pre-Tax Profit Margin Percent of Maximum Bonus
--------------------- ------------------------
At least 6% up to 8% 50%
From 8% to 10% 75%
From 10% to 12% 90%
12% and above 100%

Bonuses were paid to executive officers for fiscal year 2002 at the 6% threshold, or 50% of the
maximum bonus amount.

COMPENSATION COMMITTEE

B. LaRae Orullian D. Dale Browning
Paul S. Dempsey William B. McNamara
James B. Upchurch

Performance Graph

The following graph shows the cumulative total shareholder return on the Company's common stock
compared to the cumulative total return of two other indices: (i) The Nasdaq National Market Composite Index of
U.S. Companies (IXICN), and (ii) the Peer Group Index of similar line-of-business companies as chosen by the
Company, consisting of Midwest Express Airlines, AirTran Holdings, Inc. (formerly Valujet Airlines, Inc.), and
Vanguard Airlines, Inc. (the "Peer Group"). Each member of the Peer Group's stock is listed on the Nasdaq
National Market or the Nasdaq SmallCap Market. The time period graphed is the period from March 31, 1997 through
March 31, 2002.

COMPANY/INDEX/MARKET 03/97 03/98 03/99 03/00 03/01 03/02
Frontier Airlines, Inc. 100.00 111.10 292.42 351.96 541.72 814.14
NASDAQ Market Index 100.00 151.87 203.78 378.78 152.29 152.50
Peer Group Index 100.00 104.59 92.95 80.31 71.67 65.53

(1) Assumes $100 invested on March 29, 1997 in the Company's common stock, the Nasdaq National Market Composite
Index for U.S. Companies and the Peer Group Index of similar line-of-business companies and assumes reinvestment
of dividends and takes into account stock splits.

Equity Compensation Plan Information

The following table sets forth certain information regarding the Company's Employee Stock
Option Plan, as amended, which was approved by the Company's shareholders, as well as equity compensation plans
not approved by the Company's shareholders.

Number of
Number of Shares
Shares to be Weighted Available for
Issued on Average Future Issuance Exercise of Exercise Price
Outstanding of Outstanding Under Equity
Plan Category Options Options ($) Compensation Plans
------------- ------- -------------- ------------------
Plans approved by shareholders (1) 2,070,033 $8.78 1,088,075

Plans not approved by shareholder N/A N/A N/A
-------------------------

(1) Figures reflect the total options outstanding and available for issuance under the
Company's 1994 Stock Option Plan. Of the outstanding options listed, 831,834 are immediately exercisable at a
weighted average price of $6.65. These figures also include the warrants granted to Samuel D. Addoms on April 1,
2002 pursuant to the Director Compensation Agreement that took effect upon his resignation as Chief Executive
Officer. See the section above entitled "Samuel D. Addoms Severance Agreement." The Director Compensation
Agreement was entered into without shareholder approval.

PROPOSAL 1

ELECTION OF THE BOARD OF DIRECTORS

The Board of Directors of the Company has nominated Samuel D. Addoms, D. Dale Browning, Paul S.
Dempsey, William B. McNamara, B. LaRae Orullian, Jeff S. Potter, and James B. Upchurch for election to the Board
of Directors. Each of these nominees is a member of the existing Board of Directors and, with the exception of
Mr. Potter, was elected to the Board of Directors at the Company's 2000 Annual Meeting of Shareholders. The
Board of Directors appointed Mr. Potter to the Board in May 2001.

A proposal to elect Samuel D. Addoms, D. Dale Browning, Paul S. Dempsey, William B. McNamara,
B. LaRae Orullian, Jeff S. Potter, and James B. Upchurch to the Board of Directors of the Company will be
presented to the shareholders at the annual meeting.

THE COMPANY'S BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT THE SHAREHOLDERS VOTE FOR THE
ELECTION OF SAMUEL D. ADDOMS, D. DALE BROWNING, PAUL S. DEMPSEY, WILLIAM B. MCNAMARA, B. LARAE ORULLIAN, JEFF S.
POTTER, AND JAMES B. UPCHURCH TO THE COMPANY'S BOARD OF DIRECTORS. IF NO DIRECTION IS GIVEN WHEN THE DULY
EXECUTED PROXY CARD ENCLOSED HEREWITH IS RETURNED, ALL SHARES COVERED BY SUCH PROXY WILL BE VOTED FOR ALL
NOMINEES.

SHAREHOLDER PROPOSALS

Shareholders are entitled to submit proposals on matters appropriate for shareholder action
consistent with regulations of the Securities and Exchange Commission and the Company's bylaws. Should a
shareholder wish to have a proposal appear in the Company's proxy statement for next year's annual meeting, under
the regulations of the Securities and Exchange Commission it must be received by the Company's corporate
secretary at 7001 Tower Road, Denver, Colorado 80249-7312 on or before April 2, 2002.

INDEPENDENT PUBLIC ACCOUNTANTS

KPMG LLP has acted as independent public accountants for the Company continuously since 1994.
A representative of KPMG LLP will be present at the annual meeting and will have the opportunity to make a
statement if he or she desires to do so and will be available to respond to appropriate questions.

KPMG LLP was selected by the Board of Directors to perform the audit function for fiscal year
2002. No independent public accountant has yet been selected to perform the audit function for fiscal year
2003. It is expected that the Board of Directors will make such selection at its annual meeting to be held in
September 2002, or subsequent thereto.

Audit Fees, Financial Information Systems Design and Implementation Fees and All Other Fees

KPMG LLP billed the Company an aggregate of $177,500 in fees for professional services rendered for the audit of
the Company's annual financial statements, and for reviews of the Company's interim financial statements in the
Forms 10-Q filed by the Company during the fiscal year. KPMG LLP also billed the Company $56,000 for other
non-audit services for that fiscal year, primarily relating to income tax compliance and consultations regarding
personal property and other taxes and employee benefit plans.

OTHER BUSINESS

All items of business to be brought before the meeting are set forth in this proxy statement.
Management knows of no other business to be presented. If other matters of business not presently known to
management are properly raised at the meeting, the proxies will vote on the matters in accordance with their best
judgment.

NOTE: SHAREHOLDERS ARE REQUESTED TO SIGN, DATE AND PROMPTLY RETURN THE ENCLOSED PROXY CARD, USING THE
ENCLOSED POSTAGE PREPAID ENVELOPE.

PROXY FRONTIER AIRLINES, INC. PROXY
7001 Tower Road
Denver, CO 80249-7312
This Proxy is Solicited on Behalf of the Board of Directors.
The undersigned hereby appoints Jeff S. Potter, Paul H. Tate and David Sislowski, or any of them, as
Proxies, each with the power to appoint his substitute, and hereby authorizes them to represent and to vote, as
designated below, all the shares of common stock of Frontier Airlines, Inc. held of record by the undersigned on July 1,
2002, at the annual meeting of shareholders to be held on September 5, 2002, or any adjournment thereof.

The Board of Directors Recommends a vote "FOR" all nominees in Item 1

Item 1 - ELECTION OF DIRECTORS
|_| FOR all nominees |_| WITHHOLD AUTHORITY for all nominees

INSTRUCTION: To withhold authority to vote for any individual nominee, strike a line through the nominee's name in the
list below.

Samuel D. Addoms D. Dale Browning Paul S.Dempsey Jeff S. Potter

William B. McNamara B. LaRae Orullian James B. Upchurch

The shares represented by this proxy will be voted as directed by the shareholder. If no direction is given when the duly
executed proxy is returned, such shares will be voted "FOR all nominees" in Item 1.

PLEASE DATE AND SIGN ON REVERSE SIDE AND RETURN PROMPTLY IN ENCLOSED ENVELOPE.
-------------
**********************************************

In their discretion, the Proxies are authorized to vote upon such other business as may properly come before the
meeting or any adjournment thereof. This proxy when properly executed will be voted in the manner directed
herein by the undersigned shareholder. Please sign, date and return the proxy promptly, using the enclosed
envelope.

Date __________________

Signature ______________________________________

Signature
if held jointly ___________________________________

Please sign exactly as name appears. When shares are held by joint tenants, both should sign. When signing as
attorney, as executor, administrator, trustee or guardian, please give full title as such. If a corporation,
please sign in full corporate name by President or other authorized officer. If a partnership, please sign in
partnership name by authorized person.

APPENDIX I

FRONTIER AIRLINES, INC.

Audit Committee Charter
(As of May 15, 2002)
Purpose

There shall be an Audit Committee (the "Committee") of the Board of Directors of Frontier Airlines,
Inc., a Colorado corporation (the "Company").

The Committee is appointed by the Board of Directors to assist the Board in fulfilling its oversight
responsibilities. The Committee shall have responsibility to oversee the Company's management and independent
auditors in regard to corporate accounting and financial reporting. The Committee has the authority to conduct
any investigation it deems appropriate, with full access to all books and records, facilities, personnel and
outside advisors of the Company. The Committee is empowered to retain outside counsel, auditors or other experts
in its discretion. The Committee's primary duties and responsibilities are to:

a) monitor the integrity of the Company's financial reporting process and systems of internal
control regarding finance, accounting and legal compliance;

b) monitor the independence and performance of the Company's independent auditors and internal
auditing department; and

c) provide an avenue of communication among the independent auditors, management, the internal
auditing department, and the Board of Directors.

Organization

The Committee shall consist of at least three directors. Each director appointed to the Committee shall:

a) not be disqualified from being an "independent director" within the meaning of Rule 4200 of the
NASD Manual, and shall have no relationship with the Company which, in the opinion of the
Board, would interfere with the exercise of independent judgment; and

b) shall have a basic understanding of finance and accounting and be able to read and understand
fundamental financial statements, including the Company's balance sheet, income statement and
cash flow statement.

At least one member of the Committee shall have past employment experience in finance or accounting,
requisite professional certification in accounting, or any other comparable experience or background, which
results in the member's financial sophistication.

The Committee by majority vote shall select a Chair who shall serve as such until his or her
resignation, removal or election of a successor.

Responsibilities

The Committee recognizes that the preparation of the Company's financial statements and other financial
information is the responsibility of the Company's management and that auditing, or conducting limited reviews,
of those financial statements and other financial information is the responsibility of the Company's independent
auditors. The Committee's responsibility is to oversee the financial reporting process.

The Committee shall meet at least quarterly, generally in advance of Board meetings, or more frequently
as needs dictate. At least annually and otherwise as deemed appropriate by the Chair or a majority of the
Committee, the Committee shall meet privately, in executive session with management, the independent auditors,
and the internal auditors.

The Company's management, and its independent auditors, in the exercise of their responsibilities,
acquire greater knowledge and more detailed information about the Company and its financial affairs than the
members of the Committee. Consequently, the Committee is not responsible for providing any expert or other
special assurance as to the Company's financial statements and other financial information or any professional
certification as to the independent auditors' work, including without limitation their reports on and limited
reviews of, the Company's financial statements and other financial information. The Committee does not itself
prepare financial statements or perform audits, and its members are not auditors or certifiers of the Company's
financial statements.

In carrying out its oversight responsibilities, the Committee shall:

a) review and reassess the adequacy of this Audit Committee Charter annually;

b) review and recommend to the Board of Directors the independent auditors to be selected to audit
the Company's financial statements;

c) require that the independent auditors provide the Committee with a formal written statement
delineating all relationships between the independent auditors and the Company, consistent with
Independence Standards Board Standard No. 1, and discuss with the independent auditors their
independence;

d) actively engage in a dialogue with the independent auditors regarding any disclosed
relationships or services that may impact the objectivity and independence of the independent
auditors;

e) take, or recommend that the full Board take, appropriate action to oversee the independence of
the independent auditors;

f) review, approve, and oversee any engagement by the Company of the Company's independent
auditors for non-audit related work;

g) review the independent auditors' audit plan, including a discussion of scope, staffing,
locations, reliance upon management, and internal audit and general audit approach;

h) review and consider the matters required to be discussed by Statement on Auditing Standards No.
61 with the independent auditors and management, including, without limitation, review with
financial management and the independent auditors the evaluative criteria used in selection of
critical accounting policies and the results of their analysis of significant financial
reporting issues and practices, including changes in, or adoptions of, accounting principles
and disclosure practices, and discuss any other material matters required to be communicated to
the Committee by the auditors. Also review with financial management and the independent
auditors their judgments about the quality, not just acceptability, of accounting principles
and the clarity of the financial disclosure practices used or proposed to be used, and
particularly, the degree of aggressiveness or conservatism of the organization's accounting
principles and underlying estimates, and other significant decisions made in preparing the
financial statements;

i) review and discuss the Company's audited financial statements that are to be included in the
Company's Form 10-K with the independent auditors and management and determine whether to
recommend to the Board of Directors that the financial statements be included in the Company's
Form 10-K for filing with the Securities and Exchange Commission;

j) in consultation with the management and independent auditors, consider the integrity of the
Company's financial reporting process and controls. Discuss significant financial risk
exposures and the steps management has taken to monitor, control and report such exposures.
Review significant findings prepared by the independent auditors together with management's
responses;

k) review, or the Committee's Chair shall review, any matters identified by the independent
auditors pursuant to Statement on Auditing Standards No. 71 regarding the Company's interim
financial statements. Any such review shall occur prior to the filing of such interim
financial statements on the Company's Form 10-Q;

l) investigate any matter brought to its attention within the scope of its duties, with the power
to retain outside counsel for this purpose if, in its judgment, that is appropriate; and

m) review the Company's disclosure in the proxy statement for its annual meeting of shareholders
that describes that the Committee has satisfied its responsibilities under this Charter for the
prior year. In addition, include a copy of this Charter in the proxy statement at least
triennially or the year after any significant amendment to the Charter. .

The independent auditors are ultimately accountable to the Board and the Committee, as representatives
of the shareholders. The Board and the Committee have ultimate authority and responsibility to select, nominate,
evaluate and, where appropriate, replace the independent auditors and, if and when appropriate or required, to
propose the independent auditors for ratification by the shareholders in any proxy statement.