March 14, 2008.

If you attend the meeting, you may deliver your completed proxy card in person or you may vote by completing a ballot, which will be available at the meeting.

(1) by delivering to the Secretary of the Company a written instrument of revocation bearing a date later than the date of the proxy. (2) by duly executing and delivering to the Secretary of the Company a subsequent proxy relating to the same shares. (3) by attending the meeting and voting in person, provided that the shareholder notifies the Secretary at the meeting of his or her intention to vote in person at any time prior to the voting of the proxy. Required Votes •  Election of Directors.  The eight (8) nominees for director receiving the highest number of votes FOR election will be elected as directors. This is called a plurality. Abstentions are not counted for purposes of electing directors. You may vote either FOR all of the nominees, WITHHOLD your vote from all of the nominees or WITHHOLD your vote from any one or more of the nominees. Votes that are withheld will not be included in the vote tally for the election of directors. Banks and brokerage firms have authority to vote customers’ unvoted shares held by the firms in street name for the election of directors. Shares that are not voted will have no effect on the results of this vote.          (2)•  Ratification of Deloitte & Touche LLP as our Independent Registered Public Accounting Firm.  The affirmative vote of a majority of shares present in person or represented by duly executing and deliveringproxy is required to the Secretary of the Company a subsequent proxy relating to the same shares.ratify        (3) by attending the meeting and voting in person, provided that the shareholder notifies the Secretary Deloitte & Touche LLP as our independent registered public accounting firm for fiscal 2008. Abstentions are counted as “shares present” at the meeting for purposes of his or her intentiondetermining if a quorum exists. Abstentions and unvoted shares will have the effect of votes against this proposal. Banks and brokerage firms have authority to vote customers’ unvoted shares held by the firms in person at any time priorstreet name on this proposal. We are not required to obtain the votingapproval of our shareholders to select our independent registered public accounting firm. However, if our shareholders do not ratify the proxy.selection of Deloitte & Touche LLP as our independent registered public accounting firm for fiscal 2008, the Audit Committee of our Board of Directors will reconsider its selection. Required Votes      A plurality of votes cast by shareholders who are either present in person or represented by proxy at the meeting is required to elect the seven (7) nominees for Director under Proposal 1. Approval of Proposals 2 and 3 require the affirmative vote of a majority of the shares present and entitled to vote on these proposals at the Annual Meeting. The total number of votes that could be cast at the meeting is the number of votes actually cast plus the number of abstentions. Abstentions are counted as “shares present” at the meeting for purposes of determining whether a quorum exists and have the effect of a vote “against” any matter as to which they are specified. Proxies submitted by brokers that do not indicate a vote for some or all of the proposals because they do not have discretionary voting authority and have not received instructions as to how to vote on these proposals (so-called “broker non-votes”) are also considered “shares present” and will have the affect a vote against the proposal for which no vote is indicated. Dissenter’s Rights or Appraisal Pursuant to applicable Nevada law, there are no dissenter’s or appraisal rights relating to the matters to be acted upon at the Annual Meeting. Other Matters to Be Acted Upon at the Meeting We do not know of any matters other than the election of directors the proposal to ratify and approve the 2005 Employee Stock Incentive Plan, and the ratification of independent registered public accountants that are expected to be presented for consideration at the Annual Meeting. If any other matters are properly presented at the meeting, the shares represented by proxies will be voted in accordance with the judgment of the persons voting those shares. Solicitation The cost of soliciting proxies, including the cost of preparing and mailing the Notice and Proxy Statement, will be paid by the Company. Solicitation will be primarily by mailing this Proxy Statement to all shareholders entitled to vote at the meeting. Proxies may also be solicited by officers and directors of the Company personally or by telephone or facsimile, without additional compensation. The Company may reimburse brokers, banks and others holding shares in their names for others for the cost of forwarding proxy materials and obtaining proxies from beneficial owners. Communications with the Board of Directors      Stockholders Shareholders may communicate with any and all members of the Company’sour Board of Directors by transmitting correspondence by mail or facsimile addressed to one or more directors by name or, for a communication to the entire board, to the Chairman of the Board at the following address and fax number: Mesa Air Group, Inc.,c/o Corporate Secretary, 410 North 44th Street, Suite 700,100, Phoenix, Arizona 85008; facsimile:(602) 685-4350. 685-4352. Communications from our stockholdersshareholders to one or more directors will be collected and organized by our Corporate Secretary under procedures adopted by our independent directors.Secretary. The Corporate Secretary will forward all communications to the Chairman of the Board or to the identified director(s) as soon as practicable, although communications that are abusive, in bad taste or that present safety or security concerns may be handled differently. If multiple communications are received on a similar topic, the Corporate Secretary may, in his direction,discretion, forward only representative correspondence. The Chairman of the Board will determine whether any communication addressed to the entire Board of Directors should be properly addressed by the entire Board of Directors or a committee thereof. If a communication is sent to the Board of Directors or a committee, the Chairman of the Board or the chairman of that committee, as the case may be, will determine whether a response to the communication is warranted. If it is determined that a response to the communication is warranted, the content and method of the response may be coordinated with our counsel. 2 ELECTION OF DIRECTORS (PROPOSAL NO. 1) General Information The Company’s current directors are Jonathan G. Ornstein, Daniel J. Altobello, Robert Beleson, General Ronald R. Fogleman,Carlos E. Bonilla, Joseph L. Manson, Peter F. Nostrand, Maurice A. Parker and Julie Silcock.Richard R. Thayer. Their terms expire upon the election and qualification of their successors at the Annual Meeting. The Board has nominated each of these 2 current directors as nominees for election as directors in the election to be held at the Annual Meeting. The Board intends to vote its proxies for the election of its nominees, for a term to expire at the Company’s 20052009 Annual Meeting. If unforeseen circumstances make it necessary for the Board of Directors to substitute another person for any of the nominees, we will vote your shares “for” that other person, or, if no substitute is selected by the Board prior to or at the Annual Meeting, for a motion to reduce the present membership of the Board to the number of nominees available. We know of no reason why any nominee would be unable or unwilling to accept nomination or election. The information concerning the nominees and their share holdings in the Company has been furnished by the nominees to the Company. The seven (7)eight (8) nominees receiving a plurality of votes by shares represented and entitled to vote at the Annual Meeting, if a quorum is present, will be elected as directors of the Company. The following table sets forth the names and ages of the directors of the Company and certain additional information:Company:               Name Age Position Jonathan G. Ornstein     4750     Chairman of the Board Daniel J. Altobello     6466     Director Robert Beleson     5457     Director Ronald R. FoglemanCarlos E. Bonilla     6353     Director Joseph L. Manson     5558 Director Peter F. Nostrand 60     Director Maurice A. Parker     5962     Director Julie SilcockRichard R. Thayer     4950     Director Directors Biographical information regarding the Company’sour directors is set forth below. Jonathan G. Ornsteinwas appointed President and Chief Executive Officer of the Company effective May 1, 1998. Mr. Ornstein became a director in January 1998. Mr. Ornstein assumed the role of Chairman of the Board in June 1999. On June 21, 2000, Mr. Ornstein relinquished his position as President of the Company.Company to Michael J. Lotz. From April 1996 until joining the Company as Chief Executive Officer, Mr. Ornstein served as President and Chief Executive Officer and Chairman of Virgin Express S.A./N.V., a European airline. From 1995 to April 1996, Mr. Ornstein served as Chief Executive Officer of Virgin Express Holdings, Inc. Mr. Ornstein joined Continental Express Airlines, Inc. as President and Chief Executive Officer in July 1994 and, in November 1994, was named Senior Vice President, Airport Services at Continental Airlines, Inc. Mr. Ornstein was previously employed by the Company from 1988 to 1994, as Executive Vice President and as President of the Company’s subsidiary, WestAir Holding, Inc. Daniel J. Altobellohas served as a director of the Company since January 1998.1998 and is the current Lead Director. Mr. Altobello also serves as a member of the Compensation Committee and as an ex-officio non-voting member of the Nominating & Corporate Governance Committee. Mr. Altobello is currently the Chairman of Altobello Family Partners, an investment company and is the retired Director and Chairman of Onex foodservices,FoodServices, the parent corporation of Caterair International, Inc., and LSG/SKY Chefs. From 1989 to 1995, Mr. Altobello served as Chairman, President and Chief Executive Officer of Caterair International Corporation. From 1979 to 1989, he held various managerial positions with the food service management and in-flight catering divisions of Marriott 3 Corporation, including Executive Vice President of Marriott Corporation and President of Marriott Airport Operations Group. Mr. Altobello began his management career at Georgetown University as Vice President of Administration Services. He is a member of the board of directors of World Airways, Inc. and Friedman, Billings and Ramsey Group, Inc. (both public reporting companies.) Mr. Altobello is also a director of several private companies:, Diamond Rock Hospitality Trust Inc.,and JER Real Estate InvestmentInvestors Trust, all reporting companies, and Mercury Air Centers; andan advisory director of Thayer Capital Partners, a private company. He is also a trustee of Loyola Foundation, Inc. Mr. Altobello obtained a bachelor of arts in English from Georgetown University and a master of business administration from Loyola College. Robert Belesonwas elected as a director of the Company in October 2003. Mr. Beleson also serves as Chairman of the Nominating & Corporate Governance Committee and is a member of the Audit Committee. In November 2004, he became the Chief Executive Officer of Christiana Spirits Incorporated and served in that capacity until September 2007. Mr. Beleson is also an equity investor in Christiana Spirits Incorporated and currently serves as its Chairman. Since May 2002, Mr. Beleson has also provided marketing and strategic planning consulting services to select clients in the aviation and wine and 3 spirit industries. This consulting service was formally organized as Brookfield Marketing, LLCL.L.C. on October 1, 2003. In November 2001, he became the Chief Executive Officer of Christiana Spirits Incorporated, of which Mr. Beleson is also an equity investor. From July 2001 to April 2002, he served as Chief Marketing Officer for Avolar, a former Divisiondivision of United Airlines. From March 1996 to December 2000, he served as President of M. Shanken Communications, Inc., New York, N.Y.New York. From May 1991 to February 1996, he served as Chief Marketing Officer for Playboy Enterprises. Mr. Beleson received a bachelor of science from Cornell University School of Industrial and Labor Relations and a master of business administration from Harvard Business School. General Ronald R. Fogleman, USAF, (Ret.)Carlos E. Bonillahas beenwas elected as a director of the Company since January 1998. In September 1997, he retired in the rank of General, having servedApril 2006. Mr. Bonilla also serves as the Chief of Staffa member of the United States Air Force from 1994 until 1997 and as Commander-in-ChiefCompensation Committee. He is currently Senior Vice President of the United States Transportation CommandWashington Group, a government relations firm and has been with such firm since March 2003. He previously served, from 1992January 2001 until 1994. General Fogleman is the ChairmanMarch 2003, as a Special Assistant to President George W. Bush, focusing on a variety of transportation and CEO of Durango Aerospace, Inc., a privately held international aviation consulting firm. He currently serves on the board of directors of: AAR Corporation; Alliant Techsystems, Inc.; Rolls-Royce North America; and World Airways, Inc. On May 31, 2004, General Fogleman became the non-executive Chairman of the Board of World Airways, Inc. Hepension issues. Mr. Bonilla received a bachelor of arts degreein economics from the United States Air Force AcademyAmerican University and a master’s degreemaster of arts in military history and political scienceeconomics from DukeGeorgetown University. Joseph L. Mansonhas been a director of the Company since July 2001. Mr. Manson isalso serves as a partner inmember of the Nominating & Corporate Governance Committee. Mr. Manson joined the Washington, D.C. office of the law firm Baker & Hostetler LLP as a partner in February 2005. Prior to joining Baker & Hostetler, Mr. Manson was employed with Piper Rudnick LLP (which merged with Verner Liipfert Bernhard McPherson and Hand), where he has been employed since 1974. Mr. Manson received a bachelor of science from the University of Virginia and a doctorate in jurisprudence from Emory University. Peter F. Nostrandwas elected as a director of the Company in April 2005. Mr. Nostrand also serves as Chairman of the Compensation Committee and is a member of the Audit Committee. He is currently the Chairman Emeritus, SunTrust, Greater Washington where he has served in a variety of functional divisions including International, National, Energy, Commercial and Retail beginning in June 1973. Mr. Nostrand received a bachelor of arts from Amherst College and a master of education from the University of Virginia. Maurice A. Parkerhas been a director of the Company since November 1998. Mr. Parker has served as Executive Director of Regional Aviation Partners since April 2001. From 1978 to January 1997, Mr. Parker served as a Federal Mediator for the National Mediation Board of the United States government. From 1997 to the present, Mr. Parker has worked as an independent arbitrator, mediator and consultant. Mr. Parker obtained a bachelor of science in technical education from the University of Houston and a doctorate in jurisprudence from South Texas College of Law. Julie SilcockRichard R. Thayerhas servedwas elected as a director of the Company since July 2001. Since November 2000, Ms. Silcock has beenin April 2006. Mr. Thayer also serves as Chairman of the Managing DirectorAudit Committee and headis a member of Southwest Investment Bankingthe Nominating & Corporate Governance Committee. He is currently the Executive Vice President, Finance at Philadelphia Media Holdings LLC and its principal subsidiary Philadelphia Newspapers LLC, publisher of Citigroup Global Market, Inc. From August 1997the Philadelphia Inquirer and the Philadelphia Daily News. Prior to November 2000, she served asjoining Philadelphia Media Holdings LLC, he was Managing Director at Donaldson, LufkinJ.P. Morgan Securities, Inc. He has over twenty-five years experience in the banking and securities industries at J.P. Morgan and its predecessor banks including, Managing Director, in its Restructuring, Syndicated & Jenrette. From January 1984 to August 1997, she was an investment banker with Bear, Stearns & Co., Inc., most recently as a Senior Managing Director. Ms. Silcock receivedLeveraged Finance and Global Transportation groups. Mr. Thayer obtained a bachelor of artsscience from the Wharton School, University of Pennsylvania with a dual major in comparative literature from Princeton UniversityFinance and a master of business administration from Stanford Graduate School of Business.Marketing. 4 THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT YOU VOTE “FOR” THE ELECTION OF JONATHAN G. ORNSTEIN, DANIEL J. ALTOBELLO, ROBERT BELESON, CARLOS E. BONILLA, JOSEPH L. MANSON, PETER F. NOSTRAND, MAURICE A. PARKER AND COMMITTEE MEETINGSRICHARD R. THAYER AS DIRECTORS FOR FISCAL YEAR 2008.      Information concerning the three Committees maintained by the CORPORATE GOVERNANCE The Board of Directors is responsible for providing oversight of the affairs of the Company for the benefit of stockholders. The Board of Directors has adopted Corporate Governance Guidelines, charters for its Audit, Compensation, Nominating/Corporate Governance and Code of Conduct and Ethics for directors, officers and employees of Mesa Air Group, Inc., its subsidiaries and affiliated companies. You can obtain copies of our current committee charters, codes and policies in the “Corporate Governance” section of our website (www.mesa-air.com) or by writing to our Corporate Secretary at 410 North 44th Street, Suite 100, Phoenix, Arizona 85008. Any substantive amendment to, or waiver from, any provision of the Code of Conduct and Ethics with respect to any director or executive officer will be posted on our website. Director Selection Criteria.  The Nominating/Corporate Governance Committee of the Board (the“Nominating/Corporate Governance Committee”) recommends nominees for director whose background, knowledge, experience, expertise and perspective will complement the qualifications of other directors and strengthen the Board. The criteria considered by such Committee is discussed in more detail below. Director Independence.  Each year, the Board reviews the relationships that each director has with the Company. For purposes of making director independence determinations, the Board utilizes the director independence standards set forth below. in the NASDAQ Marketplace Rules. Only those directors who the Board affirmatively determines have no material relationship with the company, and who do not have any of the categorical relationships that prevent independence under the NASDAQ Marketplace Rules, are considered to be independent directors. The Board Committeeshas determined that all of the directors, excluding Messrs. Ornstein and Parker (who are considered employees of the Company) have no material relationships with the Company and qualify as independent directors. The Board concluded that none of these directors possessed the categorical relationships set forth in the NASDAQ Marketplace Rules that prevent independence and had no other business or other relationships with the Company relevant to a determination of their independence. The Board committees currently consist only of Directorsdirectors who are not employees of the Company and who are “independent” within the meaning of the listing standardsNASDAQ Marketplace Rules. The members of our Audit Committee also meet the additional NASDAQ and SEC independence and experience requirements applicable specifically to members of the NASD. Audit Committee. Recommendation of Candidates for Director by Stockholders; Direct Nominations by Stockholders.  The Nominating/Corporate Governance Committee will consider, but is not required to approve, recommendations from stockholders concerning the nomination of directors. Recommendations should be submitted in writing to the Corporate Secretary of the Company and state the stockholder’s name and address, the name and address of the candidate, and the qualifications of and other detailed background information regarding the candidate. Recommendations must be received not later than 120 calendar days preceding the date of release of the prior year’s proxy statement. The Nominating/Corporate Governance Committee intends to evaluate candidates recommended by stockholders in the same manner that it evaluates other candidates. The Company has not received any stockholder recommendations of director candidates with regard to the election of directors covered by this proxy statement or otherwise. Board Meetings.  The Board held tennine meetings during the 20042007 fiscal year. No director attended less than 75% of the Board meetings while serving as such director, or less than 75% of all committee meetings on which he or she served as a committee member. 5 Meeting Attendance.  The Company does not have a formal policy regarding attendance by members of the Board of Directors at our annual meeting of stockholders,shareholders, but strongly encourages directors to attend. All members of the Board of Directors attended the 2007 annual meeting of shareholders. At various times throughout the year non-management directors hold meetings without the presence of management personnel. The Lead Director, Daniel J. Altobello, chairs these meetings and is also the Chair of themeetings. Board Committees.  The Audit, Nominating/Corporate Governance Committee. 4 The audit, nominating and compensationCompensation committees are the standing committees of the Board. The fiscal year 20042007 committees were comprised as follows:           Audit Nominating/Corporate Governance Compensation   RonaldRichard R. Fogleman*Thayer*   Robert Beleson* Peter F. Nostrand* Peter F. Nostrand Richard R. Thayer Daniel J. Altobello Robert Beleson Joseph L. Manson Carlos E. Bonilla     Daniel J. Altobello*Altobello, ex-officio     Daniel J. Altobello* Julie Silcock Julie Silcock Julie Silcock Robert Beleson Robert Beleson Robert Beleson   * Chairman Audit Committee.  The audit committeeAudit Committee of the Board (the “Audit Committee”) held sixeight meetings during fiscal 2004.2007. The main function of our Audit Committee, among other things, recommendswhich has been established in accordance with Section 3(a)(58)(A) of the Company’s independent registered public accountants, reviews the Company’s financial statements, makes reports and recommendations regarding the adequacySecurities Exchange Act of internal1934, as amended (the “Exchange Act”), is to oversee our accounting controls made by the independent registered public accountants and considers such other matters with respect to the accounting, auditing and financial reporting procedures as it may deem appropriate or as may be brought to its attention. processes, internal systems of control, independent auditor relationships and the audits of our financial statements. This committee’s responsibilities include: •  Selecting and hiring our independent auditors; •  Evaluating the qualifications, independence and performance of our independent auditors; •  Approving the audit and non-audit services to be performed by our independent auditors; •  Reviewing the design, implementation, adequacy and effectiveness of our internal controls and our critical accounting policies; •  Overseeing and monitoring the integrity of our financial statements and our compliance with legal and regulatory requirements as they relate to financial statements or accounting matters; •  Reviewing with management any earnings announcements and other public announcements regarding our results of operations; •  Reviewing regulatory filings with management and our auditors; and •  Preparing any report the Securities and Exchange Commission (“SEC”) requires for inclusion in our annual proxy statement. The Audit Committee acts under a written charter adopted and approved by the Board in May 2000. A copy of the original Audit Committee Charter is attached as an exhibit to the Company’s 2001 Annual Meeting Proxy Statement. The Audit Committee Charter was amended in April 2002, July 2004 and July 2004. A copy of the amended Audit Committee CharterNovember 2006. The revised charter is attached as Exhibit A to this Proxy Statement. The Audit Committee is composed of outside directors who are not officers or employees of the Company or its subsidiaries. In the opinion of the Board and as “independent” is defined under current standards of the NASDNASDAQ (including the heightened independence requirements of audit committee members), these directors are independent of management and free of any relationship that would interfere with their exercise of independent judgment as membermembers of this committee.      The nominating committee Additionally, the Board has determined that Peter F. Nostrand and Richard R. Thayer, each of the Board (the “Nominating Committee”) met onceAudit Committee, is an “audit committee financial expert,” as such term is defined in Item 407(d)(5)(ii) ofRegulation S-K. Messrs. Thayer’s and Nostrand’s relevant experience is included in the biographical information set forth above. Nominating/Corporate Governance Committee.  The Nominating/Corporate Governance Committee held three meetings in fiscal 2004. In November 2003, the Nominating Committee was merged with a newly established corporate governance committee, creating the2007. The Nominating/Corporate Governance Committee. A Corporate Governance/ Nominating Committee charterCharter was adopted in August 2004.2004 and amended in July 2005 and November 2006. The revised charter is attached as Exhibit B to this Proxy Statement. The Nominating/Corporate Governance Committee is responsible for identifying and nominating 6 individuals qualified to serve on the Board and the Committees of the Board, as well as reviewing the effective corporate governance policies and procedures and recommending any applicable modifications thereto. The Nominating/ Corporate Governance Committee will consider, but is not required to approve, nominations for directors by shareholders for any annual meeting of the Company, provided a written recommendation is received by the Company no later than the date shareholder proposals must be submitted for consideration prior to such annual meeting. In evaluating the suitability of potential nominees for membership on the Board, the Nominating/Corporate Governance Committee will consider the criteria discussed above, as well as the Board’s current composition, including expertise, diversity, and balance of inside, outside and independent directors, and consider the general qualifications of the potential nominees, such as:   •  Unquestionable integrity and honesty;     •  The ability to exercise sound, mature and independent business judgment in the best interests of the shareholders as a whole;     •  Recognized leadership in business or professional activity;     •  A background and experience that will complement the talents of the other Board members;     •  Willingness and capability to take the time to actively participate in Board and Committee meetings and related activities;     •  Ability to work professionally and effectively with other Board members and the Company’s management; 5   •  An age to enable the Director to remain on the Board long enough to make an effective contribution; and     •  Lack of realistic possibilities of conflict of interest or legal prohibition. The Committee will also see that all necessary and appropriate inquiries are made into the backgrounds of such candidates. Other than the foregoing, there are no stated minimum criteria for director nominees, although the Nominating/Corporate Governance Committee may also consider such other factors as it may deem to be in the best interests of the Company and its stockholders. In obtaining the names of possible new nominees, the Committee may make its own inquiries and will receive suggestions from other Directors, stockholders and other sources. All potential nominees must first be considered by the Committee before being contacted as possible nominees and before having their names formally considered by the full Board. Compensation Committee.  The compensation committeeCompensation Committee of the Board (the “Compensation Committee”) operates under a charter adopted in February 2004 and amended in November 2006 and held five meetings during the 20042007 fiscal year. The revised charter is attached as Exhibit C to this Proxy Statement. The Compensation Committee is responsible for allocating cashassists the Board of Directors with its overall responsibility relating to compensation and stock optionsmanagement development, including recommending to seniorthe Board of Directors for approval the compensation of our Chief Executive Officer, approval of compensation for our other executive officers, administration of our equity-based compensation plans and oversight of our executive development programs. The report of the Company. Compensation Committee appears on page 14 of this Proxy Statement. It is expected that all current committee members will be nominated for re-election to such committees at a Board meeting to be held immediately following the Annual Meeting.      The Communication with Directors.  Stockholders may communicate with the Board of Directors adopted a Code of Ethics in fiscal 2003, which applies to the Company’s financial executives, as well as the financial executives of the Company’s subsidiaries.      You can obtain copies of our current committee charters and Code of Ethics in the “Corporate Governance” section of our website (www.mesa-air.com) or by writing to ourthe Board of Directors in care of the Corporate Secretary of the Company (or, at the stockholder’s option, to a specific director) as follows: Board of Directors,c/o Corporate Secretary, Mesa Air Group, Inc., 410 North 44th Street, Suite 700, Phoenix, Arizona 85008. COMPENSATION OF DIRECTORS Fees The following fees were paidCorporate Secretary will ensure that these communications (assuming they are properly marked to Directors who were not employees of the Company during fiscal 2004. Directors who are full-time employees of the Company receive no additional compensation for serving as directors. Board members also are reimbursed for all expenses associated with attending Board or Committee meetings.           Annual Retainer   $ 15,000   Fee for each Board meeting   $ 1,000   Fee for each telephonic Board meeting   $ 500   Fee for each Committee meeting   $ 500   In July 2004, the Board of Directors approved additional annual retainers for the Lead Director and certain Committee chair positions as set forth below:           Lead Director   $ 10,000   Compensation Committee Chairman   $ 10,000   Audit Committee Chairman   $ 20,000   Stock Options      Under the Outside Director’s Option Plan, each non-employee director receives an annual grant of options to purchase 3,000 shares of Common Stock, plus the number of options to purchase Common Stock equivalentor to a cash value of $20,000 as calculated pursuantspecific director) are delivered to the Black-Scholes Valuation Method (collectively, the “Formula Amount”), at a risk-free rateBoard of a ten-year zero coupon bond. Each non-employee director receives an additional Formula Amount on April 1st of each year thereafter. Upon being appointed a 6 non-employee director after April 1, such director is granted a pro-rata portion of the Formula Amount and receives options pursuant to the plan on April 1st of each succeeding year. The amount of pro rata options granted to each new non-employee director is calculated by dividing the number of days prior to April 1st by the number of days in the calendar year and multiplying the quotient by the Formula Amount. Other Benefits      Each non-employee director, and certain family members of such director, receives free travel on Mesa Air and free or reduced-fare travel on certain air carriers at no cost to the CompanyDirectors or the director. The Company believes thatspecified director, as the directors’ use of free air travel is “de minimis” and did not maintain any records of non-employee directors’ travel during fiscal 2004. COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION      During the fiscal year 2004, the Compensation Committee consisted of Messrs. Altobello and Beleson and Ms. Silcock. None of the members of the committee held any executive officer position or other employment with the Company prior to or during such service. case may be. REPORT OF AUDIT COMMITTEE OF THE BOARD OF DIRECTORS The Audit Committee assists the Board in fulfilling its responsibility for oversight of the internal control, accounting, auditing and financial reporting practices of the Company. Specific responsibilities of the Audit Committee include: •  reviewing and discussing the audited financial statements with management; •  discussing with the Company’s independent registered public accountants information relating to the independent registered public accountants’ judgments about the quality of the Company’s accounting policies and financial reporting practices; •  recommending to the Board that the Company include the audited financials in its Annual Report on Form 10-K; and •  overseeing compliance with the Securities and Exchange Commission requirements for disclosure of registered public accountants’ services and activities. The Committee regularly meets with management to consider the adequacy of the Company’s internal controls and the integrity of its financial reporting. The Committee discusses these matters with the Company’s independent registered public accountants and with appropriate Company financial personnel and internal auditors. 7 The Committee regularly meets privately with management, the independent registered public accountants and the internal auditors. Each of theThe independent registered public accountants hashave unrestricted access to the Committee. The Committee retains and, if circumstances warrant, replaces the independent registered public accountants and regularly reviews their performance and independence from management. The Committee also pre-approves all audit and permitted non-audit services and related fees. The Board of Directors has determined that none of the Directorsdirectors serving on the Committee has a relationship towith the Company that may interfere with their independence from the Company and its management. As a result, each Directordirector who serves on the Committee is “independent” as required by NASDNASDAQ listing standards. standards (including the heightened independence requirements of audit committee members) and Section 10A of the Exchange Act. The Board of Directors has adopted a written charter setting out the roles and responsibilities the Committee is to perform. The Board has determined that Julie SilcockPeter F. Nostrand and Richard R. Thayer, each of the Audit Committee, is an “audit committee financial expert,” as such term is defined in Item 401(h)407(d)(5)(ii) ofRegulation S-K. 7 Management has primary responsibility for the Company’s financial statements and the overall reporting process, including the Company’s system of internal controls. Review of Audited Financial Statements The Audit Committee has reviewed the Company’s financial statements for the fiscal year ended September 30, 2004,2007, as audited by Deloitte & Touche LLP, the Company’s independent registered public accountants, and has discussed these financial statements with management. In addition, the Audit Committee has discussed with Deloitte & Touche LLP the matters required to be discussed by Statement of Auditing Standards No. 61 and Rule 2-07, as amended, regarding the codification of statements on auditing standards. Furthermore, the Audit Committee has received the written disclosures and the letter from Deloitte & Touche LLP required by the Independence Standards Board Standard No. 1 and has discussed with Deloitte & Touche LLP its independence. has: •  Discussed with Deloitte & Touche LLP the matters required to be discussed by the Statement on Auditing Standards No. 61, as amended (Codification of Statements on Auditing Standards, AU 380), as adopted by the Public Company Accounting Oversight Board (“PCAOB”) in Rule 3200T. •  Received the written disclosures and the letter from Deloitte & Touche LLP required by Independence Standards Board Standard No. 1 (Independence Standards Board Standard No. 1, “Independence Discussions with Audit Committees”), as adopted by the PCAOB in Rule 3600T, and has discussed with Deloitte & Touche LLP its independence. In reliance on the reviews and discussions referred to above, the Audit Committee recommended to the Board that the audited financial statements for the fiscal year ended September 30, 20042007 be included in the Company’s Annual Report onForm 10-K, for filing with the Securities and Exchange Commission. The members of the Audit Committee are not professionally engaged in the practice of auditing or accounting. Members of the Audit Committee rely, without independent verification, on the information provided to them and on the representations made by management and the independent registered public accountants. Accordingly, the Audit Committee’s oversight does not provide an independent basis to determine that management has maintained procedures designed to assure compliance with accounting standards and applicable laws and regulations. Furthermore, the Audit Committee’s considerations and discussions referred to above do not assure that the audit of the Company’s financial statements has been carried out in accordance with accepted auditing standards of the Public Company Accounting Oversight Board, that the financial statements are presented in accordance with accounting principles generally accepted in the United States of America and that the Company’s independent registered public accountants are in fact “independent.” AUDIT COMMITTEE Richard R. Thayer, Chairman Peter F. Nostrand Robert Beleson 8 AUDIT COMMITTEE Ronald R. Fogleman Julie Silcock Robert Beleson RATIFICATION OF SELECTION OF INDEPENDENT REGISTERED PUBLIC ACCOUNTANTS (PROPOSAL NO. 2) Deloitte & Touche LLP has been selected as the Company’s independent registered public accountants for the fiscal year ending September 30, 2008. Shareholder ratification of the selection of Deloitte & Touche LLP as the Company’s independent registered public accountants is not required by the Company’s Bylaws or otherwise. However, the Board is submitting the selection of Deloitte & Touche LLP for shareholder ratification as a matter of good corporate practice. Deloitte & Touche LLP has audited the Company’s financial statements since 2000. Notwithstanding the selection, the Board, in its discretion, may direct appointment of a new independent accounting firm at any time during the year if the Board feels that such a change would be in the best interests of the Company and its shareholders. A representative of Deloitte & Touche LLP is expected to be present at the Annual Meeting with the opportunity to make a statement if he or she so desires and to be available to respond to appropriate questions. Ratification of the appointment of Deloitte & Touche LLP as the Company’s independent registered public accountants for fiscal year 2008 will require the affirmative vote of the holders of at least a majority of the outstanding Common Stock represented in person or by proxy at the Annual Meeting. All of the directors and executive officers of the Company have advised the Company that they will vote their shares of Common Stock “FOR” the ratification of the appointment of Deloitte & Touche LLP as the Company’s independent registered public accountants for fiscal year 2008. If the holders of at least a majority of the outstanding Common Stock fail to ratify the appointment of Deloitte & Touche LLP as the Company’s independent registered public accountants, the Audit Committee will consider such failure at a subsequent meeting of the Audit Committee and determine, in its discretion, what actions it should take, if any. THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT YOU VOTE “FOR” RATIFICATION OF THE APPOINTMENT OF DELOITTE & TOUCHE LLP AS THE COMPANY’S INDEPENDENT REGISTERED PUBLIC ACCOUNTANTS FOR FISCAL YEAR 2008. 9 DISCLOSURE OF AUDIT AND NON-AUDIT FEES Pre-approval Policy In August 2003, the Audit Committee adopted a Pre-approval Policy (“Policy”) governing the approval of all audit and non-audit services performed by the independent registered public accountants in order to ensure that the performance of such services does not impair the independent registered public accountants. According to the Policy, the Audit Committee will annually review and pre-approve the services and fees that may be provided by the independent registered public accountants during the following year.accountants. The Policy specifically describes the services and fees related to the annual audit, other services that are audit-related, preparation of tax returns and tax related compliance services and all other services that have the pre-approval of the Audit Committee. The term of any general pre-approval is 12 months from the date of pre-approval, unless the Audit Committee specifically provides for a different period. Any service to be provided by the independent registered public accountants that has not received general pre-approval under the Policy is required to be submitted to the Audit Committee for approval prior to the commencement of a substantial portion of the engagement. Any proposed service exceeding pre-approved cost levels is also required to be submitted to the Audit Committee for specific approval. 8      The Audit Committee will revise the list of general pre-approved services from time to time based on subsequent determinations. The Committee does not delegate its responsibilities to pre-approve services performed by the independent registered public accountant to management. Fees The following table sets forth the aggregate fees billed by Deloitte & Touche LLP for fiscal 20032007 and 2004:                                           Audit Audit Related Tax All Other Year Fees(1) Fees(2) Fees(3) Fees(4) Total 2003   $ 463,000     $ 259,000     $ 487,000     $ 0     $ 1,209,000   2004     435,000       356,000       355,000       18,000       1,164,000   2006:                                                     Audit                         Audit     Related     Tax     All Other         Year   Fees(1)     Fees(2)     Fees(3)     Fees(4)     Total     2006   $ 1,532,000     $ 125,000     $ 139,000     $ 10,000     $ 1,806,000   2007   $ 2,593,125     $ 37,650     $ 200,625     $ 69,401     $ 2,900,801   (1) Includes fees for the annual audit and quarterly reviews. This category also includes fees for the audit of internal controls, as required by Section 404 of the Sarbanes-Oxley Act of 2002.   (2) Includes fees for services for miscellaneous compliance audits and other SEC filings.   (3) Includes fees for annual federal and state income tax compliance services and property tax fees.services.   (4) Includes miscellaneous tax consulting services. All Other Fees consist principally of professional services performed by our independent auditor with respect to certain transactional work contemplated by the Company during fiscal 2007 and in connection with preparing workpapers for retention to comply with a court order in our Aloha Airlines litigation. 10 SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT The following table sets forth certain information regarding the beneficial ownership of Common Stock as of September 30, 2004February 4, 2008 by (i) each director of the Company, (ii) each of the Company’s officers named in the Summary Compensation Table (collectively, the “Named Executive Officers”), (iii) each person who is known by the Company to be the beneficial owner of more than five percent of the Company’s outstanding Common Stock, and (iv) all directors and executive officers as a group. Except as otherwise indicated below, each person named has sole voting and investment power with respect to the shares indicated.                                     Amount and Nature of Beneficial Ownership Options/ Name and Address of Beneficial Owner Shares(1) Warrants(1) Total(1) Percent(1) State Street Research & Management Co     2,347,600       —       2,347,600       7.4 %   One Financial Center, 30th Floor                                   Boston, MA 02111-2690                                 Putnam, LLC     1,822,793       —       1,822,793       5.7 %   One Post Office Square                                   Boston, MA 02109                                 Wells Capital Management Incorporated     1,618,874       —       1,618,874       5.1 %   525 Market Street, 10th Floor                                   San Francisco, CA 94104                                 Wells Fargo & Company     2,496,295       —       2,496,295       7.9 %   420 Montgomery Street                                   San Francisco, CA 94104                                 Directors                                 Jonathan G. Ornstein(2)     137,902       1,514,846       1,652,748       5.2 % Daniel J. Altobello     6,000       59,325       65,325       *   Ronald R. Fogleman(3)     1,200       47,287       48,487       *   Joseph L. Manson     10,000       23,208       33,208       *   Robert Beleson     0       7,170       7,170       *   Maurice Parker     2,000       25,583       27,583       *   Julie Silcock     2,000       26,208       28,208       *   9                                   Amount and Nature of Beneficial Ownership Options/ Name and Address of Beneficial Owner Shares(1) Warrants(1) Total(1) Percent(1) Officers                                 Michael J. Lotz     11,000       473,120       484,120       1.5 % George Murnane III     3,500       133,142       186,642       *   Michael Ferverda     0       72,066       72,066       *   Brian S. Gillman     0       104,000       104,000       *   F. Carter Leake     0       121,667       121,667       *   Edward J.Wegel     0       0       —       *   All directors and officers as a group (12 Individuals)     173,602       2,657,622       2,831,224       8.9 %                                       Amount and Nature of                   Beneficial Ownership                         Options/                         Warrants/                         Convertible               Name and Address of Beneficial Owner   Shares(1)     Notes(1)     Total(1)     Percent(1)     Dimensional Fund Advisors Inc.(2)     2,457,498       —       2,457,498       9.0 % 1299 Ocean Avenue, 11th Floor                                 Santa Monica, CA 90401                                 Donald Smith & Co., Inc.(3)     3,393,181       —       3,393,181       12.5 % 152 West 57th Street                                 New York, NY 10019                                 Heartland Advisors, Inc.(4)     3,151,140       —       3,151,140       11.6 % William J. Nasgovitz                                 789 North Water Street                                 Milwaukee, WI 53202                                 QVT Financial LP(5)     50,912       1,469,887       1,520,799       5.6 % QVT Financial GP LLC                                 1177 Avenue of the Americas, 9th Floor                                 New York, New York 10036                                 Thompson, Siegal & Walmsley, Inc.(6)     2,067,915       —       2,067,915       7.6 % 6806 Paragon Place, Suite 300                                 Richmond, VA 23230                                 Directors                                 Jonathan G. Ornstein(7)     209,770       1,689,846       1,899,616       7 % Daniel J. Altobello(8)     9,221       72,457       81,678       * Carlos E. Bonilla(8)     3,721       4,515       8,236       * Joseph L. Manson(8)(9)     2,221       16,214       18,435       * Robert Beleson(8)     2,221       20,302       22,523       * Maurice A. Parker(8)     10,721       12,758       23,479       * Peter F. Nostrand(8)     30,721       12,884       43,605       * Richard R. Thayer(8)     6,221       4,515       10,736       * Named Executive Officers                                 Michael J. Lotz(10)     96,492       564,786       661,278       2.4 % George Murnane III     9,101       53,333       62,434       * William Hoke     —       —                   Michael Ferverda(11)     —       75,000       75,000       * Brian S. Gillman(12)     8,135       88,000       96,135       * All directors and executive officers as a group (13 Individuals)     388,545       2,614,610       3,003,155       11 %  * Less than 1% (1) Includes options and warrants exercisable or convertible notes convertible on September 30, 2004February 4, 2008 or within 60 days thereafter. Number of shares as reported by each company’s Schedule 13G. Holdings of less than 1% are indicated by “*”. Based upon 31,704,62527,227,141 shares issued and outstanding as of September 30, 2004.January 11, 2008.   (2) Includes 65,902 shares held by Mr. Ornstein’s children, mother Based solely on the most recently available Schedule 13G filed with the Securities and spouse.Exchange Commission on February 9, 2007. 11 (3) Based solely on the most recently available Schedule 13G filed with the Securities and Exchange Commission on February 13, 2007.   (3) (4) Based solely on the most recently available Schedule 13G filed with the Securities and Exchange Commission on August 8, 2007. Heartland Advisors, Inc. shares dispositive power over 3,151,140 shares and voting power over 2,996,140 shares with William J. Nasgovitz, its president and principal shareholder. (5) Based solely on the most recently available Schedule 13G filed with the Securities and Exchange Commission on September 5, 2007. Includes 1,469,887 shares issuable upon conversion of Mesa’s convertible notes. QVT Financial LP shares voting and dispositive power over these shares with QVT Financial GP LLC, its general partner. (6) Based solely on the most recently available Schedule 13G filed with the Securities and Exchange Commission on February 12, 2007. (7) Includes 1,20016,667 restricted shares of common stockthat will become unrestricted shares on April 1, 2008 and 49,999 options that vest on April 1, 2008. (8) Includes 1,221 restricted shares that will become unrestricted shares on March 1, 2008. (9) Includes 1,000 shares held by B Bar J Pension Fund,Barrow Grocery, which is controlled by Gen. Fogleman.Mr. Manson. (10) Includes 11,111 restricted shares that will become unrestricted shares on April 1, 2008 and 33,333 options that vest on April 1, 2008. (11) Includes 8,333 options that vest on February 15, 2008. (12) Includes 9,999 options that vest on February 15, 2008 and 3,334 restricted shares that will become unrestricted shares on April 1, 2008. Section 16(a) Beneficial Ownership Reporting Compliance with Section 16(a) of the Securities Exchange Act, of 1934      Section 16(a) of the Securities Exchange Act of 1934, as amended, requires the Company’s directors and executive officers, as well as persons beneficially owning more than 10% of the outstanding Common Stock, to file certain reports of ownership with the Securities and Exchange CommissionSEC within specified time periods. Such officers, directors and shareholders are also required by Securities and Exchange CommissionSEC rules to furnish the Company with copies of all Section 16(a) forms they file. Based solely on its review of such forms all requirements received by it, or written representations from certain reporting persons, the Company believes that between October 1, 20032006 and September 30, 2004,2007, all Section 16(a) filing requirements applicable to its officers, directors and 10% shareholders were met. Compensation Committee Report The Compensation Committee (the “Committee”) has reviewed and discussed the following Compensation Discussion and Analysis (the “CD&A”) and discussed it with management. Based on its review and discussion with management, the Committee recommended to the Board of Directors that the CD&A be included in this proxy statement and incorporated by reference into the Company’s annual report onForm 10-K. This report is provided by the following independent directors, who comprise the Committee: Peter F. Nostrand, Chairman Daniel J. Altobello Carlos E. Bonilla 12 10 EXECUTIVE COMPENSATION AND RELATED INFORMATION COMPENSATION DISCUSSION & ANALYSIS The following paragraphs describe the material elements of the Company’s compensation objectives and policies and the application of these objectives and policies to the Company’s executive officers, particularly the individuals named in the Summary Compensation Table on page 22 of this proxy statement. The rules regarding disclosure of executive compensation in proxy statements were modified significantly in 2006. This is our first proxy statement to which the new rules apply. Accordingly, the information in this proxy statement is not directly comparable to the information disclosed in prior years. The following discussion and analysis should be read in conjunction with the “Summary Compensation Table” and related tables that are presented in this proxy statement. Executive Summary The purpose of this compensation discussion and analysis is to provide information about each material element of compensation that we pay or award to, or that is earned by, our named executive officers. For our 2007 fiscal year, our named executive officers were: •  Jonathan G. Ornstein, our Chairman and Chief Executive Officer; •  Michael J. Lotz, our President and Chief Operating Officer and Chief Accounting Officer; •  Michael Ferverda, our Senior Vice President — Operations; •  William Hoke, our interim Chief Financial Officer; and •  Brian S. Gillman, our Executive Vice President and General Counsel. George Murnane III, our former Executive Vice President and Chief Financial Officer is also a named executive officer in this proxy statement because he was employed by the Company in fiscal 2007 and, therefore, disclosure regarding his compensation is required under SEC regulations. On September 21, 2007, Mr. Murnane was placed on administrative leave. Mr. Murnane’s employment was terminated on November 5, 2007. William Hoke performed Mr. Murnane’s duties while he was on administrative leave and was appointed interim Chief Financial Officer effective with Mr. Murnane’s termination. The following discussion and analysis addresses and explains the numerical and related information contained in the summary compensation tables and includes actions regarding executive compensation that occurred after the end of our 2007 fiscal year, including the award of bonuses related to 2007 performance, and the approval by our Compensation Committee of amendments to the employment agreements to which some of our named executive officers are a party. Executive Compensation Philosophy and Objectives The Company’s executive compensation policies, as endorsed by the Compensation Committee, have been designed to provide a balanced compensation program that will assist the Company in its efforts to attract, motivate and retain talented executives who the Compensation Committee and senior management believe are important to the long-term financial success and growth of the Company. The Company seeks to provide a balanced compensation program consisting of base salaries, cash incentives, equity-based incentives, perquisites and deferred compensation, but to emphasize incentive compensation that will: •  be competitive in the marketplace; •  permit us to attract and retain highly qualified executives; •  encourage extraordinary effort on behalf of the Company; •  reward the achievement of specific financial goals by the Company, which aligns the interests of management with the interests of our stockholders; and •  be financially sound. 13 The Company strives to allocate a significant percentage of total compensation to incentive compensation. The more responsibility executives have over time, the more their pay is determined by the degree to which certain performance goals are reached. We refer to that part of compensation as “at risk” pay and it is a fundamental way in which the Company aligns executive pay with stockholder interests. For example, as described in greater detail below, for our senior executive officers cash incentive bonuses can equal a significant percentage of base salary if maximum performance thresholds are achieved. This compensation philosophy translates into the following two principles in our executive compensation design: 1. Base salary should decrease as a percentage of total direct compensation as the executive’s responsibilities increase. As employees move to higher levels of responsibility with more direct influence over the Company’s performance, they have a higher percentage of pay at risk. 2. The ratio of long-term incentive compensation (equity) to short-term incentive compensation (cash) should increase as the executive’s responsibilities increase. We expect our executives to focus on the Company’s long-term success in achieving profitable growth and generating greater shareholder return. The compensation program is designed to motivate executives to take actions best aligned toward achieving such goals. Executives in positions that most directly affect corporate performance should have as their main priority profitably growing the Company. Receiving part of their compensation in the form of equity reinforces the link between their actions and shareholders’ investment. Equity ownership encourages executives to behave like owners and provides a clear link with shareholders’ interests. The Company believes that its compensation policies have been, thus far, successful in motivating and retaining its executive officers, as evidenced by the limited turnover in its executive officer ranks in recent years. Role of the Compensation Committee and Management in Setting Compensation Role of the Compensation Committee. The Compensation Committee primarily administers the Company’s cash compensation plans and employee stock option and award plans, and it has the responsibility for recommending the allocation of cash and other compensation, as well as equity awards and discretionary bonuses to senior executive officers of the Company. The entire Board of Directors regularly reviews the Compensation Committee decisions relating to executive compensation. The Compensation Committee consists of three non-employee directors, Messrs. Altobello, Bonilla and Nostrand, all of whom are “independent” according to NASDAQ standards and “disinterested” as required byRule 16b-3 of the Exchange Act. Role of Management. At the beginning of each fiscal year, our CEO evaluates the performance of our President; and the CEO and President evaluate the performance of the other executive officers against the strategic operating plan for the prior fiscal year. In addition, the CEO’s and the President’s evaluations of individual performance also focus on executive officers’ leadership abilities, including their professional development and mentoring of their direct reports. This additional evaluation is carried out by evaluating, on a quarterly basis, each executive officer’s performance against a set of performance factors mutually set and agreed upon by the executive officer and the CEO or President, as the case may be. The CEO and President then develop compensation recommendations for the other executive officers. Factors that are weighted in making individual target compensation recommendations include: •  the performance review conducted by the CEOand/or the President; •  value of the job in the marketplace; •  relative importance of the position within the Company; 14 •  individual tenure and experience; and •  individual contributions to the Company’s results. The CEO or President review of an executive officer’s performance with respect to his or her performance factors is not directly tied to the executive officer’s compensation. Such reviews, however, heavily influence the CEO’sand/or President’s assessment of an executive officer’s readiness for the types of responsibilities typically associated with a particular position. Once an executive officer’s role and responsibilities are defined, “value of the job in the marketplace” and “relative importance of the position within the executive ranks” are the most determinative factors in setting the proper compensation plan for that executive officer, adjusted to take into consideration the executive officer’s tenure and experience. At the Committee’s regularly scheduled meeting in November, the Committee reviews and considers the CEO and President’s compensation recommendations for each executive officer. The other executive officers, except as described above, do not play a role in setting executive officer compensation. Compensation Methodologies; Role of Consultants and Benchmarking The Compensation Committee periodically assembles, with the assistance of independent executive compensation consultants, competitive market information about executive compensation from a periodic review of companies included in a peer group, other competitive market compensation information, executive compensation trends, our business needs, and our financial performance compared to peers. The Committee reviews this competitive information together with performance assessments of our executives and recommendations provided by the CEO and President. The Committee obtained such information from Frederick W. Cooke & Co. (“FWC”) in April 2004 and utilized such information in setting the compensation for Messrs. Ornstein and Lotz when the Company entered into their respective employment agreements. Generally, the Committee’s goal is to set executive officers’ compensation levels to fall within the median to upper quintiles of surveyed companies, with guaranteed salary levels to remain reasonably consistent with median to upper quintile rates. For fiscal 2007, based on Company performance, total compensation for all of the named executive officers was at or above the market median. In determining what it believes to be market median for executive positions, the Committee obtained information from FWC regarding competitive market compensation data available from the proxy statements of peer group companies selected by the Committee. The peer group utilized for setting the compensation for Messrs Ornstein and Lotz in their 2004 employment agreements consisted of publicly traded regional and national air carriers that are headquartered in the United States with whom the Company competes for employees with similar skills. Our management worked with FWC to make specific recommendations to the Committee with regard to compensation based upon the market data and management’s assessment of the performance of each individual executive officer (other than the CEO). For the CEO, the Committee conducts the performance assessment. Compensation amounts realized from past years and prior year equity awards are generally not considered in the current year’s determination of each individual’s compensation package. The impact of tax or accounting treatments for particular forms of compensation also are generally not considered, except to the extent they reflect industry norms. The Compensation Committee reviews and approves on an annual basis the evaluation process and compensation structure for the Company’s senior officers. The Committee evaluates, with the CEO’s and President’s input, the Company’s other executive officers and approves the annual compensation, including salary, bonus, incentive and equity compensation, for such officers. The Committee also provides oversight of management’s decisions concerning performance and compensation of other Company officers. The Committee generally meets in the first quarter of each year to review and recommend changes to annual and incentive compensation. 15 Compensation Program Design and Elements of Compensation The principal components of compensation for our named executive officers are: •  base salary and benefits; •  short-term cash incentive compensation; •  long-term equity-based compensation; •  perquisites; •  severance and change in control plans; and •  retirement benefits in the form of deferred compensation. Base Salary and Benefits Base salary and broad-based benefits, which are not at risk, are designed to attract and retain executives by providing fixed compensation based on competitive market practice, relative to the skills, experience and expected contributions of each executive officer of the Company. Base salaries for Messrs. Ornstein, Lotz and Gillman are set in their respective employment agreements, which are described below in the “Employment and Change of Control Arrangements” section. The base salaries for Messrs. Ferverda and Hoke were set based on a review of comparative market information for similar situated positions in the airline industry, and Mr. Murnane’s base salary was set forth in an employment agreement. Our Compensation Committee reviews base salaries annually and targets base pay for executive officers at the median to upper quintiles of the comparison groups and adjusts, as appropriate, for tenure, performance and variations in actual position responsibilities from position descriptions in the comparison groups. We took into account compensation levels payable to executives in our industry and reviewed executive compensation information with regard to comparably-sized companies. We further considered the increasingly active market (and correspondingly increased cash and equity compensation levels) for executives with established track records, and potential costs to the Company if replacement management executives were required. We also took into account information concerning employment opportunities with third parties available to our named executive officers, and the importance of retaining their services in areas such as operational leadership and continuing interactions with stakeholders. We continue to consider market conditions with respect to the compensation of all of our executives. The approved 2007 base salaries, as compared to 2006 salaries, include the following for the named executive officers: •  Jonathan G. Ornstein, Chairman and Chief Executive Officer — $450,000 (2006 — $450,000); •  Michael J. Lotz, President and Chief Operating Officer — $400,000 (2006 — $400,000); •  Brian S. Gillman, our Senior Vice President and General Counsel — $160,000 (2006 — $150,000) •  Michael Ferverda, our Senior Vice President — Operations — $100,000 (2006 — $99,808); and •  William Hoke, our interim Chief Financial Officer — $140,000 (2006 — Mr. Hoke commenced employment in March 2007). Mr. Murnane, our former Executive Vice President and Chief Financial Officer, received a base salary of $250,000 in 2007, as compared to a base salary of $237,308 in 2006. Our named executive officers are also eligible to participate in employee benefit plans generally available to our employees, including medical, health, life insurance and disability plans. Our named executive officers are also eligible to participate in the Company’s 401(k) plan, and receive Company matching contributions, which are generally available to our employees. Information concerning perquisites, which, by definition, are not generally available to our employees are described in greater detail below. 16 Short-Term Cash Incentive Compensation The Compensation Committee views cash incentive compensation as a means of closely tying a significant portion of the total potential annual cash compensation for executives to the financial performance of the Company. Our cash incentive compensation plans are designed to reward individuals for the achievement of certain defined financial objectives of the Company, namely earnings per share growth. Incentive bonuses for Messrs. Ornstein and Lotz, and formerly Mr. Murnane, which are set forth in their respective employment agreements, are payable quarterly and set at a prescribed percentage of base salary, based upon the year over year percentage growth in earnings per share (“EPS”) of the Company. EPS was selected to align incentive compensation with corporate EPS goals and because the Compensation Committee believes investors may focus on EPS growth when valuing the Company’s common stock. Under the employment agreements, earnings per share is defined as gross profit (loss) before taxes and one-time non-recurring items, divided by basic outstanding shares. The following table sets forthsummarizes incentive bonuses that were potentially payable to each of Messrs. Ornstein, Lotz and Murnane in fiscal 2007.                                           % Change   Quarterly     Annual     Actual   Name   Bonus Level   EPS   Amount     Amount     Amount     Jonathan G. Ornstein,   Minimum   Positive   $ 13,125     $ 52,500     $ 52,500   Chairman and Chief   Threshold   5%   $ 26,250     $ 105,000     $ -0-   Executive Officer   Target   10%   $ 52,500     $ 210,000     $ -0-       Maximum   15%   $ 105,000     $ 420,000     $ -0-   Michael J. Lotz,   Minimum   Positive   $ 10,000     $ 40,000     $ 40,000   President and Chief   Threshold   5%   $ 20,000     $ 80,000     $ -0-   Operating Officer   Target   10%   $ 40,000     $ 160,000     $ -0-       Maximum   15%   $ 80,000     $ 320,000     $ -0-   George Murnane III,   Minimum   Positive   $ 10,000     $ 40,000     $ 30,000   former Executive Vice President and   Threshold   5%   $ 20,000     $ 80,000     $ -0-   Chief Financial Officer   Target   10%   $ 30,000     $ 120,000     $ -0-       Maximum   15%   $ 45,000     $ 180,000     $ -0-   In fiscal 2007, our GAAP EPS declined from $1.01 in fiscal 2006 to $(2.63), primarily attributable to a non-cash impairment charge recorded during the second quarter of fiscal 2007 totaling approximately $37.7 million on a pre-tax basis and loss contingency charge of $86.9 million on a pretax basis during the fourth quarter of fiscal 2007. Notwithstanding this full year decline, our EPS improved in the first quarter of fiscal 2007 over the comparable periods in fiscal 2006. As a result, Messrs. Ornstein, Lotz and Murnane received cash bonuses during fiscal 2007 of $52,500, $40,000 and $30,000, respectively. Mr. Gillman’s employment agreement also provides for an incentive bonus equal to a minimum of 30% of his base salary, payable quarterly, if the Company is profitable. In addition, Mr. Gillman is eligible to receive an additional discretionary cash bonus in the aggregate of 31% to 100% of Mr. Gillman’s salary at such time that the Board of Directors grants similar bonuses to other executives of the Company. Mr. Gillman’s total compensation, including bonus levels, was set to provide a total compensation package commensurate with similarly situated executives. In fiscal 2007, Mr. Gillman received an incentive bonus of $91,407 for the same reason described above with respect to Messrs. Ornstein and Lotz. Mr. Hoke is not a party to an employment agreement with the Company. In accordance with his offer letter, Mr. Hoke is entitled to a guaranteed bonus of $60,000 and received a signing bonus of $15,000. In subsequent fiscal years 2004, 2003Mr. Hoke will be eligible to receive a bonus of up to $80,000 based on the profitability of the Company and 2002his individual performance. Similarly, Mr. Ferverda is not a party to an employment agreement. He is eligible to receive a bonus of up to $80,000 based on the profitability of the Company and his individual performance. The Company also, at times, pays discretionary cash bonuses to its named executive officers. In fiscal 2007, the Company did not pay any discretionary cash bonuses to its named executive officers. 17 Long-Term Equity Based Compensation The purpose of the Company’s long-term incentive compensation plan is to provide a substantial equity incentive for our executive officers to manage the business for the long-term, complementing the annual bonus that rewards performance in a particular year, and to reward them for the performance of the Company and its common shares over multi-year periods. The Committee awards long-term compensation in the form of annual non-qualified stock option grants, and beginning in fiscal year 2006, restricted stock awards (in lieu of option grants). The Company believes granting restricted stock in lieu of stock options results in less dilution to existing shareholders, enables the Company to utilize its existing option plans longer (because the Company grants less restricted shares than options), and more accurately depicts the expense associated with such benefit. The Committee has not established any long-term incentive programs that are settled in cash because the Committee believes that stock settled programs offer better alignment between the interests of our executive officers and our shareholders. Equity Plans The Company has two active equity compensation plans — the Key Officer Stock Option Plan and the 2005 Employee Stock Incentive Plan. The Key Officer Stock Option Plan provides for options to be issued to the Chief Executive Officer and President at set dates for prescribed amounts. The 2005 Employee Stock Incentive Plan permits the four other most highly compensated executive officersissuance of incentive and non-qualified stock options, restricted stock and performance shares, which are performance bonuses payable in either cash or shares. All employees of the Company whose totalor its subsidiaries, including the named executive officers, are eligible to participate in the plan, and awards are issued at the discretion of the Compensation Committee upon recommendation by the Chief Executive Officer. Options granted under the 2005 Employee Stock Incentive Plan are issued at the weighted average price of common stock on the date of grant, generally vest at the rate of one-third per year commencing one year after the grant date, have a10-year term and are subject to standard option provisions, including the requirement of continued employment and provisions to deal with termination of employment due to retirement, death or disability. Shares of restricted stock granted under the plan are issued at the weighted average price of common stock on the date of grant and typically vest in one-third increments over a three-year period. Equity Awards Although the employment agreements for Messrs. Ornstein, Lotz, Murnane and Gillman provide for annual option grants, each of these individuals entered into a restricted stock agreement with the Company pursuant to which each agreed to forego their respective option grants in favor of annual restricted stock grants. Messrs. Ornstein, Lotz, Murnane and Gillman are, and Murnane was, entitled to receive an amount of restricted stock equal to the net value of options to which each such person was otherwise entitled. In 2007, Messrs. Ornstein, Lotz, Murnane, and Gillman received 50,000, 33,333, 20,000, and 10,000 shares of restricted stock, respectively. The 20,000 shares of restricted stock granted to Mr. Murnane were cancelled prior to becoming unrestricted shares as a result of his termination on November 5, 2007. Messrs. Ferverda and Hoke do not have employment agreements with the Company. In 2007, they each received restricted stock grants of 10,000 shares. Health and Welfare The Committee has provided named executive officers with the same health and welfare benefits it provides all its other US-based employees; including medical, dental and vision coverage, life and disability insurance, and, as discussed above, a defined contribution plan (401(k)). Messrs. Ornstein, Lotz, and Gillman also have the option to participate in the Company’s Deferred Compensation Plan. Other Compensation Plans and Perquisites Retirement Plans The Company provides opportunities for all employees to save for retirement in three benefit plans: a voluntary defined contribution plan (401(k)), an employee stock purchase plan and a deferred compensation plan. A 18 deferred compensation plan is also made available to Messrs. Ornstein, Lotz and Gillman pursuant to the terms of their respective employment agreements. These plans are designed to provide competitive retirement benefits. 401(k) The Company maintains a defined contribution retirement plan for all its eligible employees in the United States under Section 401(k) of the Internal Revenue Code (the “401(k) Plan”). The 401(k) Plan offers the named executive officers and all other employees the opportunity to contribute up to 85% of their annual salary and bonuses exceeded $100,000bonus up to a specified maximum. In addition, the Company makes a matching contribution to each employee equal to 30% of an employee’s contributions, with a cap of 10% of such employee’s annual compensation. The rules of the Internal Revenue Code limit the compensation that may be used in applying any deferral election or matching contribution. In 2007, that limit was $225,000 (the “IRS Cap”). Perquisites The Company provides executive officers with a limited number of perquisites that the Company and the Committee believe are reasonable and consistent with its overall compensation program, and necessary to remain competitive. The Committee periodically reviews the level of perquisites provided to the named executive officers. Costs associated with these perquisites are included under “All Other Compensation” in the Summary Compensation Table. Retirement Benefits — Deferred Compensation The Company offers the 2005 Mesa Air Group, Inc. Deferred Compensation Plan to provide certain members of management with the opportunity to save for retirement and accumulate wealth in a tax-efficient manner beyond what is available under the Company’s 401(k) retirement savings plan. The Compensation Committee believes that the deferred compensation plan motivates and assists in the retention of key employees by providing them with greater flexibility in structuring the timing of their compensation payments. The deferred compensation plan is an important retention and recruitment tool for the Company, as the companies with which we compete for executive talent typically provide a similar plan to their senior employees. The employment agreement for Mr. Ornstein requires the Company to make annual deferred compensation payments to an account for the benefit of Mr. Ornstein in an amount equal to his base salary ($450,000 in 2007) at the endtime of fiscal 2004 (the “Namedcontribution. The employment agreement for Mr. Lotz requires the Company to make annual deferred compensation payments to an account for the benefit of Mr. Lotz in an amount equal to his base salary ($400,000 in 2007) at the time of contribution into a deferred compensation account for the benefit of Mr. Lotz. Following the November 20, 2007 amendments that are described in greater detail below, the employment agreement for Mr. Gillman requires the Company to contribute $50,000 each year into a deferred compensation account for the benefit of Mr. Gillman. All of these contributions are made on March 1st of each year. Messrs. Hoke and Ferverda do not participate in any deferred compensation plans. Severance and Change in Control Payments It is our belief that the interests of shareholders will be best served if the interests of our senior management are aligned with them, and providing change of control benefits should eliminate, or at least reduce, any reluctance of senior management to pursue potential change of control transactions that may be in the best interests of shareholders. The salary multiple of the change of control benefits and use of the single trigger change of control benefits were determined after considering market data. In addition, the difference in salary multiples between executives was selected based on internal equities and demands of the job as well as the ability of the specific executive to find a similar position following a change of control. Relative to the overall value of the Company, the Compensation Committee believes these potential change of control benefits are reasonable. The cash components of any change of control benefits are paid lump-sum and are based upon a multiple of base salary plus bonus as described under the section entitled “Employment Agreements and Change of Control” with respect to each named executive officer entitled to such benefits. 19 Stock Ownership Guidelines The Board has established share ownership guidelines for its members. Each non-employee member of the Board is strongly encouraged to hold shares of the Company’s common stock having an acquisition value equal to one-year’s retainer, with such ownership to be achieved within fives years of joining the Board. Deductibility of Executive Officers”). Compensation Section 162(m) of the Internal Revenue Code of 1986, as amended, generally prohibits a public company from taking an income tax deduction for compensation over one million dollars paid to the Chief Executive Officer and its four other highest paid executive officers unless certain conditions are met. While the anticipated tax treatment of base and incentive compensation is given some weight in making compensation decisions, the Compensation Committee has not adopted a policy of limiting awards of compensation to amounts that would be deductible under Section 162(m) because the Compensation Committee believes that awards of compensation which would not comply with the Section 162(m) requirements may at times further the long-term interests of the Company and its stockholders. Summary Compensation Table                                                             Annual Compensation Long-Term Awards Other Annual Restricted Securities All Other Compensation Stock Awards Under-Lying Compensation Name and Principal Position Year Salary($) Bonus($) ($)(1)(2) ($)(3) Options (#) ($)(4) Jonathan G. Ornstein     2004       250,000       432,500       361,296       1,964,787       150,000       1,862,076     Chief Executive Officer     2003       200,000       420,000       259,782       ���       150,000       2,377           2002       200,000       420,000       200,000       —       366,313       939   Michael J. Lotz     2004       212,500       330,625       223,734       1,568,663       100,000       1,487,000     President & Chief Operating     2003       175,000       320,000       175,000       —       100,000       2,450     Officer     2002       175,000       320,000       175,000       —       239,786       1,264   George Murnane III(5)     2004       167,917       188,396       —       —       —       1,748     Executive Vice President & CFO     2003       145,000       180,000       —       —       40,000       —           2002       97,038       135,000       —       —       150,000       —   Brian S. Gillman     2004       117,500       93,813       —       —       —       2,065     Vice President & General Counsel     2003       110,000       67,800       —       —       30,000       2,276           2002       110,000       36,000       —       —       60,000       1,266   F. Carter Leake     2004       122,500       86,042       —       —       —       2,025     Senior Vice President — East     2003       120,000       49,400       —       —       25,000       2,019     Coast Operations     2002       120,000       67,000       —       —       30,000       —   The following table sets forth information concerning the compensation of our Chief Executive Officer and Chief Financial Officer, as well as the three next highest paid executive officers of the Company (the “Named Executive Officers”) as of September 30, 2007.                                                                                                                   Change in                                                       Pension Value                                                       and                                                       Nonqualified                                                 Non-Equity     Deferred     All Other         Name and                     Stock     Option     Incentive Plan     Compensation     Compensation         Principal Position   Year     Salary(1)     Bonus     Awards(4)     Awards     Compensation     Earnings     (5)     Total     Jonathan G. Ornstein,     2007     $ 450,000     $ 52,000     $ 111,884       —       —       —     $ 53,897     $ 667,781   Chairman and Chief Executive Officer                                                                         Michael J. Lotz,     2007     $ 400,000     $ 40,000     $ 74,587       —       —       —     $ 43,129     $ 557,716   President and Chief Operating Officer                                                                         Brian S. Gillman,     2007     $ 150,000     $ 91,407     $ 22,381       —       —       —     $ 3,136     $ 266,924   Executive Vice President and General Counsel                                                                         Michael Ferverda,     2007     $ 90,173     $ 81,694       —       —       —       —     $ 2,966     $ 174,833   Senior Vice President - Operations                                                                         George Murnane III,     2007     $ 247,000     $ 30,000     $ 44,755       —       —       —     $ 3,186     $ 324,941   former Executive Vice President and Chief Financial Officer(2)                                                                         William Hoke, Vice     2007     $ 140,000     $ 33,333       —       —       —       —       —     $ 173,333   President of Finance and Interim Chief Financial Officer(3)                                                                         (1) With respect Messrs. Ornstein and Lotz deferred a portion of their respective salaries under the Mesa Air Group, Inc. 2005 Deferred Compensation Plan, which is included in the Nonqualified Deferred Compensation Table on page 27. Messrs. Ornstein, Lotz, Gillman and Ferverda also contributed a portion of their salaries to Jonathan Ornstein, amounts reported for the fiscal years ended 2002, 2003, and 2004 include deferred compensation of $200,000, $200,000 and $263,216, respectively. For fiscal years 2003 and 2004, Mr. Ornstein’s total also includes personal use of company aircraft of $38,786 and $57,189, disability and life insurance premium payments of $8,451 and $8,451 and a non-accountable expense allowance of $12,545 and $32,440, respectively. With respect to Michael Lotz, amounts reported for the fiscal years ended 2002, 2003 and 2004 include deferred compensation of $175,000, 175,000 and $223,734, respectively.Company’s 401(k) Plan.   (2) Except for Mr. Ornstein in fiscal years 2003 and 2004,Murnane’s employment with the amountsCompany terminated effective November 5, 2007. Amounts reflected in this column do not reflect perquisites sincetable were paid pursuant to the dollar valueterms of these personal benefitsMr. Murnane’s employment agreement and occurred prior to his termination from the Company. 20 (3) Mr. Hoke began his employment with the Company in each reported year did not exceedMarch 2007 and began serving as acting Chief Financial Officer on September 21, 2007, when the lesser of $50,000 or ten percent of each executive officer’s salary andCompany’s prior Chief Financial Officer was placed on administrative leave. He was appointed interim Chief Financial Officer effective November 5, 2007. Mr. Hoke’s bonus amounts.amount includes a $15,000 signing bonus.   (3) (4) This column represents the dollar amount recognized for financial statement reporting purposes with respect to fiscal year 2007 for the fair value of the restricted shares granted in fiscal 2007 as well as in prior fiscal years, in accordance with the Statement of Financial Accounting Standards No. 123R (“SFAS 123R”). The aggregate number and value asamounts shown include the impact of estimated forfeitures related to service-based vesting conditions. For additional information, refer to note 1 of the footnotes to the Company’s financial statements included in itsForm 10-K for the fiscal year ended September 30, 2004,2007, as filed with the SEC. See the Grants of those Named Executive Officers’ restricted share holdings are as follows: Mr. Ornstein, 238,156 sharesPlan-Based Awards Table for information on awards made in fiscal 2007. These amounts reflect the Company’s accounting expense for these awards, and $1,214,596; Mr. Lotz, 190,141 shares and $969,719.do not correspond to the actual value that will be recognized by the named executive officers. The sharesnumber of restricted common stockshares awarded to Mr.Messrs. Ornstein, Lotz, Gillman, Ferverda and Mr.Hoke in 2007 are 50,000, 33,333, 10,000, 10,000 and 10,000, respectively. The restrictions on Messrs. Ornstein, Lotz and Gillman’s restricted shares will vestlapse in equal one-third increments over a three-year period beginning April 1, 2008. The restrictions on March 31, 2005.Mr. Ferverda’s restricted shares will lapse in equal one-third increments over a three-year period beginning August 8, 2008. The restrictions on 5,000 of Mr. Hoke’s restricted shares will lapse in equal one-fifth increments over a five-year period beginning April 11, 2008 and the restrictions on Mr. Hoke’s other 5,000 restricted shares will lapse in equal one-fifth increments over a five-year period beginning August 8, 2007. (5) The compensation represented by the amounts for 2007 set forth in the All Other Compensation column for the named executive officers are detailed in the following table.                                             Company                   Life Insurance     Contributions to                   and     Retirement Benefit           Nonaccountable   Name   Disability Premiums     Plan     Travel Benefits     Expense Allowance     Jonathan G. Ornstein   $ 8,451     $ 3,115     $ 18,858     $ 23,473   Michael J. Lotz     3,825       3,208       8,890       27,206   Brian S. Gillman     —       3,136       —       —   Michael Ferverda     —       2,966       —       —   George Murnane III     —       3,186       —       —   William Hoke     —       —       —       —   GRANTS OF PLAN-BASED AWARDS FOR FISCAL YEAR 2007 The following table shows additional information regarding all grants of plan-based awards made to our named executive officers for the year ended September 30, 2007.                                                                                                                                 All Other     All Other                                                       Stock     Option                                                       Awards:     Awards:     Exercise                                                 Number of     Number of     or Base             Estimated Future Payouts Under     Estimated Future Payouts Under     Shares of     Securities     Price of             Non-Equity Incentive Plan Awards(1)     Equity Incentive Plan Awards     Stock or     Underlying     Option       Grant     Threshold     Target           Threshold     Target     Maximum     Units     Options     Awards   Name   Date     ($)     ($)     Maximum ($)     (#)     (#)     (#)     (#)(2)     (#)     ($/Sh)     Jonathan G. Ornstein     10/1/06     $ 105,000     $ 210,000     $ 420,000       —       —       —       50,000       —       —   Michael J. Lotz     10/1/06     $ 80,000     $ 160,000     $ 320,000       —       —       —       33,333       —       —   Brian S. Gillman     10/1/06     $ 44,204     $ 45,677 to $147,346     $ 147,346       —       —       —       10,000       —       —   Michael Ferverda     10/1/06     $ 20,000     $ 20,000 to $80,000     $ 80,000       —       —       —       10,000       —       —   George Murnane III     10/1/06     $ 80,000     $ 120,000     $ 180,000       —       —       —       20,000       —       —   William Hoke     10/1/06     $ 60,000 (3)   $ 60,000     $ 60,000       —       —       —       10,000       —       —   21 (1) As discussed in the CD&A under “Short-Term Cash Incentive Compensation,” the potential payout at threshold level is pegged at achieving a 5% year over year change in EPS for the applicable period, a 10% change in EPS at the target level, and a 15% change in EPS at the maximum level for Messrs. Ornstein and Lotz. The potential payout for Mr. Gillman at the threshold level is based on the Company being profitable in the applicable quarterly period. Messrs. Ferverda and Hoke are entitled to receive quarterly bonuses of up to $20,000 based on the Company’s profitability and their individual performance. (2) The restrictions on Messrs. Ornstein, Lotz and Gillman’s restricted shares will lapse in equal one-third increments over a three-year period beginning April 1, 2008. The restrictions on Mr. Ferverda’s restricted shares will lapse in equal one-third increments over a three-year period beginning August 8, 2008. The restrictions on 5,000 of Mr. Hoke’s restricted shares will lapse in equal one-fifth increments over a five-year period beginning April 11, 2008 and the restrictions on Mr. Hoke’s other 5,000 restricted shares will lapse in equal one-fifth increments over a five-year period beginning August 8, 2007. (3) Pursuant to Mr. Hoke’s offer letter, he is entitled to a guaranteed bonus of $60,000 during his first year of employment with the Company. OUTSTANDING EQUITY AWARDS AT SEPTEMBER 30, 2007 The following table summarizes the equity awards we have made to each of the named executive officers that were outstanding as of September 30, 2007.                                                                                                                           Stock Awards                                                             Equity       Option Awards                 Equity     Incentive Plan                         Equity                             Incentive     Awards:                         Incentive Plan                             Plan Awards:     Market or                         Awards:                       Market     Number of     Payout Value             Number of     Number of     Number of                       Value of     Unearned     of Unearned             Securities     Securities     Securities                 Number of     Shares or     Shares, Units     Shares, Units             Underlying     Underlying     Underlying                 Shares or Units     Units of     or Other     or Other       Option     Unexercised     Unexercised     Unexercised     Option     Option     of Stock That     Stock That     Rights That     Rights That       Grant     Options (#)     Options (#)     Unearned     Exercise     Expiration     Have Not     Have Not     Have Not     Have Not   Name   Date     Exercisable     Unexercisable     Options (#)     Price($)     Date     Vested (#)     Vested ($)     Vested (#)     Vested ($)     Jonathan G. Ornstein     6/13/1998       1,000,000       —       —     $ 8.25       6/13/2008       —       —       —       —         4/1/2000       112,533       —       —     $ 6.25       4/1/2010       —       —       —       —         10/17/2001       66,313       —       —     $ 5.50       10/17/2011       —       —       —       —         4/1/2002       150,000       —       —     $ 11.13       4/1/2012       —       —       —       —         11/20/2002       61,000       —       —     $ 4.90       11/20/2012       —       —       —       —         4/1/2004       150,000       —       —     $ 8.25       4/1/2014       —       —       —       —         4/1/2005       100,001       49,999 (1)     —     $ 6.90       4/1/2015       —       —       —       —         7/14/2006       —       —       —       —       —       33,003 (2)   $ 146,533       —       —         4/1/2007       —       —       —       —       —       50,000 (3)   $ 222,000       —       —   Brian S. Gillman     12/29/2000       58,000       —       —     $ 6.72       12/29/2010       —       —       —       —         2/15/2005       20,001       9,999 (4)     —     $ 7.40       2/15/2015       —       —       —       —         7/14/2006       —       —       —       —       —       6,600 (5)   $ 29,304       —       —         4/1/2007       —       —       —       —       —       10,000 (6)   $ 44,400       —       —   Michael J. Lotz     12/28/1998       100,000       —       —     $ 6.00       12/28/2008       —       —       —       —         6/22/2000       100,000       —       —     $ 5.25       6/22/2010       —       —       —       —         10/17/2001       39,786       —       —     $ 5.50       10/17/2011       —       —       —       —         1/2/2002       100,000       —       —     $ 7.88       1/2/2012       —       —       —       —         11/20/2002       25,000       —       —     $ 4.90       11/20/2012       —       —       —       —         1/2/2004       100,000       —       —     $ 12.56       1/2/2014       —       —       —       —         4/1/2005       66,667       33,333 (7)     —     $ 6.90       4/1/2015       —       —       —       —         7/14/2006       —       —       —       —       —       22,002 (8)   $ 97,689       —       —         4/1/2007       —       —       —       —       —       33,333 (9)   $ 147,999       —       —   Michael Ferverda     10/2/2001       20,000       —       —     $ 4.04       10/2/2011       —       —       —       —         11/20/2002       30,000       —       —     $ 4.90       11/20/2012       —       —       —       —         2/15/2005       16,667       8,333 (10)     —     $ 7.40       2/15/2015       —       —       —       —         8/8/2007       —       —       —       —       —       10,000 (11)   $ 44,400       —       —   George Murnane III(14)     2/15/2005       53,333       27,777       —     $ 7.40       2/15/2015       —       —       —       —   William Hoke     4/11/2007       —       —       —       —       —       5,000 (12)   $ 22,200       —       —         8/8/2007       —       —       —       —       —       5,000 (13)   $ 22,200       —       —   (1) Assuming continued employment with the Company, these options will vest on April 1, 2008. 22 (2) Assuming continued employment with the Company, restrictions on 16,502 and 16,501 of these shares of restricted stock will lapse on July 14, 2008 and 2009, respectively (3) Assuming continued employment with the Company, restrictions on 16,667, 16,667 and 16,666 of these shares of restricted stock will lapse on April 1, 2008, 2009 and 2010, respectively.   (4) These amounts include Assuming continued employment with the Company’s vested and non-vested contributions to the individual named executive officer’s 401(k) plan account. Under the Company’s 401(k) plan, employees may contribute up to 15% of their annual salary and bonus up to a specified maximum. The Company, currently makes matching contributions equal to 25% of an employee’s contributions (including officers), with a cap of 10% of the employee’s annual compensation. With respect to Jonathan Ornstein, amounts reported for fiscal year ended September 30, 2004 include a retention bonus in the amount of $1,860,000 in consideration for entering into a new five-year employment agreement and waiving certain rights under the prior employment agreement. With respect to Mike Lotz, amounts reported for fiscal year ended September 30, 2004 include a retention bonus in the amount of $1,485,000 in consideration for entering into a new five-year employment agreement and waiving certain rights under the prior employment agreement.these options will vest on February 15, 2008.   (5) Mr. Murnane joined Assuming continued employment with the Company, restrictions on January 16, 2002. 11 OPTION GRANTS IN LAST FISCAL YEAR The following table sets forth for each Named Executive Officer information concerning individual grants of stock options during the 2004 fiscal year.                                                   Potential Realizable Value at Assumed Number of Percent of Annual Rates of Stock Securities Total Options Exercise of Price Appreciation for Underlying Granted To Base Price Option Term Options Employees in (2) Expiration Granted(1)(#) Fiscal Year ($/share) Date 5%(3)($) 10%(3)($) Jonathan Ornstein     150,000       34.8 %   $ 8.25       4/1/14       14,340       710,016   Mike Lotz     100,000       23.2 %   $ 12.56       1/02/14       —       11,773   (1)  Option grants under the 2001 Key Officer Plan. The3,300 and 3,300 of these shares underlying option grants made pursuant to the Mesa Airline Stock Option Plan vest in annual 1/3 increments beginning one year after the date of the grant.restricted stock will lapse on July 14, 2008 and 2009, respectively.   (2) (6) The exercise price was set at 100% Assuming continued employment with the Company, restrictions on 3,334, 3,333 and 3,333 of the closing pricethese shares of the Common Stockrestricted stock will lapse on the grant date, as reported on the NASDAQ National Market.April 1, 2008, 2009 and 2010, respectively.   (3) (7) Potential realizable values shown above represent the potential gains based upon annual compound stock price appreciation of 5% and 10% from October 1, 2004 through the full option term. The actual value realized, if any, on stock option exercises will be dependent upon overall market conditions and the future performance of Assuming continued employment with the Company, these options will vest on April 1, 2008. (8) Assuming continued employment with the Company, restrictions on 11,001 and 11,001 of these shares of restricted stock will lapse on July 14, 2008 and 2009, respectively. (9) Assuming continued employment with the Common Stock. There is no assurance thatCompany, restrictions on 11,111, 11,111 and 11,111 of these shares of restricted stock will lapse on April 1, 2008, 2009 and 2010, respectively. (10) Assuming continued employment with the actual value realizedCompany, these options will approximatevest on February 15, 2008. (11) Assuming continued employment with the amounts reflected in this table.Company, restrictions on 3,334, 3,333 and 3,333 of these shares of restricted stock will lapse on August 8, 2008, 2009 and 2010, respectively. (12) Assuming continued employment with the Company, restrictions on 1,000 of these shares of restricted stock will lapse on April 11, 2008, 2009, 2010, 2011 and 2012, respectively. (13) Assuming continued employment with the Company, restrictions on 1000 of these shares of restricted stock will lapse on August 8, 2008, 2009, 2010, 2011 and 2012, respectively. (14) Mr. Murnane’s options expire 90 days following his termination. OPTION EXERCISES AND STOCK VESTED FOR FISCAL YEAR 2007 The following table sets forthshows information regarding option exercises and vesting of stock awards for each named executive officer during the number of shares covered by both exercisable and unexercisable stock options as of the fiscal year ended September 30, 2004, together with the values for in-the-money options which represent the positive spread between the exercise price of any such outstanding stock and the fiscal year end price of the Common Stock. Aggregate Option Exercises In Last Fiscal Year And Year End Option Values 2007.                                       Option Awards     Stock Awards       Number of           Number of             Shares           Shares             Acquired     Value Realized     Acquired     Value Realized       on Exercise     on Exercise     on Vesting     on Vesting   Name   (#)     ($)     (#)     ($)(1)     Jonathan G. Ornstein     —       —       95,887     $ 706,941   Michael J. Lotz     —       —       74,381     $ 549,717   Brian S. Gillman     —       —       3,301     $ 22,315   Michael Ferverda     —       —       —       —   George Murnane III     —       —       6,601     $ 44,623   William Hoke     —       —       —       —   Number of Securities (1) Underlying Unexercised ValueThe aggregate dollar amount realized upon the vesting of Unexercised Shares Options at In-The-Money Options at Acquired on Value September 30, 2004 (#) September 30, 2004 ($) Name Exercise (#) Realized ($) Exercisable/Unexercisable Exercisable/Unexercisable(1) Jonathan G. Ornstein — — 1,392,742/372,104 87,380/73,000 Michael J. Lotz — — 393,192/246,594 77,334/48,666 George Murnane III — — 119,809/76,666 2,667/5,333 Brian S. Gillman — — 84,000/30,000 18,960/14,600 F. Carter Leake — — 103,334/26,666 22,867/13,933 (1)  Basedrestricted stock is calculated based on the NASDAQ Global Select Market closing price for the Company’s common stock on the vesting date of the Common Stock on September 30, 2004 of $5.10 per share, as reported by the NASDAQ National Market.each award. Amendment or RepricingNONQUALIFIED DEFERRED COMPENSATION FOR FISCAL YEAR 2007 Under the terms of Options      During the 2004 fiscalemployment agreements for certain of the Company’s executive officers, on March 31st of each year the Company did not amend or reprice any stock options held by executive officersis required to contribute an amount equal to such executive’s then existing base salary to an account for the benefit of the Company.executive under the Company’s Deferred Compensation Plan. Participants may choose from a selection of one or more investment funds designated by the Deferred Compensation Committee in which the deferred amount is then deemed to be invested. The deferred compensation and the 23 12 EQUITY COMPENSATION PLANS amount earned are generally assets, and the obligation to distribute the amounts according the participants’ designation is a general obligation of the Company. There is no penalty on any scheduled withdrawals at any age. The following table sets forth certain informationshows a summary of all nonqualified contributions to and nonqualified deferred compensation received by each of the named executive officers for the year ended September 30, 2007. The account balances as of September 30, 2004, concerning outstanding optionsyear end include amounts earned by the executive prior to 2007 and rights to purchase Common Stock granted to participants in all of the Company’s equity compensation plans (including the Outside Director’s Option Plan) and the number of shares of Common Stock remaining available for issuance under such equity compensation plans. Equity Compensation Plan Information                             Number of Securities Number of Securities Remaining Available for to be Issued Upon Weighted-Average Future Issuance Under Exercise of Exercise Price of Equity Compensation Plans Outstanding Options, Outstanding Options, (Excluding Securities Warrants and Rights Warrants and Rights Reflected in Column (a)) Plan Category (a) (b) (c) Equity compensation plans approved by security holders(1)     3,803,255     $ 6.82       443,765   Equity compensation plans not approved by security holders(2)     750,000     $ 8.23       1,250,000                         Total     4,553,255               1,693,765   (1)  Includes the Outside Directors’ Option Plan, as amended, which was approved by the shareholders on February 11, 2003. (2)  The Board of Directors adopted the 2001 Key Officer Plan on July 13, 2001. An aggregate of 2,000,000 shares are authorized for issuance under this plan. The Company’s CEO and President are the only persons eligible to participate in the Plan. Options are granted pursuant to the terms of their respective employment contracts. voluntarily deferred.                                               Executive     Registrant           Aggregate     Aggregate Balance       Contributions in     Contributions in     Aggregate Earnings     Withdrawals/     at Last       Last FY     Last FY     in Last FY     Distributions     FYE   Name   ($)     ($)     ($)     ($)     ($)     Jonathan G. Ornstein     -0-     $ 450,000       -0-       -0-     $ 2,162,031.91   Michael J. Lotz     -0-     $ 400,000       -0-       -0-     $ 1,923,433.36   Brian S. Gillman     -0-       -0-       -0-       -0-       -0-   Michael Ferverda     -0-       -0-       -0-       -0-       -0-   George Murnane III     -0-     $ 50,000       -0-       -0-     $ 142,615.04   EMPLOYMENT AND CHANGE INOF CONTROL ARRANGEMENTS The Chief Executive Officer;Officer, the President and Chief Operating Officer; the Executive Vice President and Chief Financial Officer; the Senior Vice President — East Coast Operations,Officer and the Vice President and General Counsel have each entered into an employment agreement with the Company, and the Compensation Committee approved amendments to each such agreement on November 20, 2007. The former Executive Vice President and Chief Financial Officer also had entered into an employment agreement with the Company. CEOChief Executive Officer Employment Agreement Effective as of March 31, 2004, Jonathan G. Ornstein and the Company entered into a newan employment agreement, in which Mr. Ornstein agreed to serve as the Chief Executive Officer of the Company for a term of five (5) years ending March 30, 2009. On November 20, 2007, the Compensation Committee approved extending the term of this agreement to March 30, 2012. The material terms of this agreement are described in detail below. Base Salary Under Mr. Ornstein’s agreement, he will receive an annual base salary of not less than $300,000 effective March 31, 2004, which amount shall be increased by $75,000 on the first and second anniversary dates. The base salary is subject to annual discretionary increases upon review by the Board.Board and, subject to Mr. Ornstein’s consent, may be reduced under circumstances in which the Company has suffered severe financial losses and has imposed cuts in salary of other officers on an across-the-board basis. Cash Incentive Bonus Mr. Ornstein also is entitled to an annual cash incentive bonus, paid quarterly, based on annual performance criteria as set forth in the agreement,described above, which bonus, on an annual basis, may range from $52,500 to $420,000. Additionally, the Board may approve discretionary bonuses. Mr. Ornstein’s agreement also provided for the payment of a retention bonus in the amount of $1,860,000, payable on the date of his employment agreement. Deferred Compensation Upon execution of the agreement and on March 31st each yeara monthly basis thereafter during the term of the agreement, the Company is obligated to contribute an amount equal to hisMr. Ornstein’s base salary, as deferred compensation, to an account for the benefit of Mr. Ornstein. The Company also is obligated to provide Mr. Ornstein with $5,000,000 of term life insurance, the limited use of Company aircraft, and other customary fringe benefits. Equity Compensation Mr. Ornstein’s employment agreement also providesprovided for thean initial grant of stock options to purchase 150,000 shares of Common Stock,common stock, with the options vesting in one-third increments over a three-year period, and additional annual option grants of not less than 150,000 shares throughout the term of the agreement. The 24 13 exercise price for each option is determined by the market price for the Common Stockcommon stock on the date the option is granted.      Additionally,granted, and the terms are governed by the Key Officer Stock Option Plan. On July 14, 2006, Mr. Ornstein’sOrnstein entered into a restricted stock agreement providedwith the Company whereby he received 49,505 shares of restricted stock of the Company in lieu of receiving 150,000 options for the payment of a retention bonus in thecontract year beginning April 1, 2006. The amount of $1,860,000restricted stock was based on the net value of the 150,000 options on the date of the agreement. grant and vest in one-third increments over a three-year period. Mr. Ornstein’s employment agreement also providesprovided for thean initial grant of 238,156 shares of restricted Common Stock, with thecommon stock, vesting in one-third increments over a three-year period beginning on March 31, 2005. Benefits and Perquisites Mr. Ornstein is entitled to participate in all employee benefit and welfare programs, plans and arrangements and to receive fringe benefits, such as dues and fees for professional organizations and associations, to the extent such programs, plans, arrangements and benefits are from time to time available to the Company’s executive personnel. In addition, under Mr. Ornstein’s employment agreement, the Company is also obligated to: •  pay the premiums on a term life insurance policy for Mr. Ornstein providing for a $5,000,000 benefit; •  reimburse Mr. Ornstein for usual relocation expenses if he is required to relocate outside of Maricopa County in Arizona; •  reimburse Mr. Ornstein for business expenses in accordance with the Company’s policies; •  pay Mr. Ornstein $3,000 a month for discretionary business investigation purposes; •  use reasonable efforts to obtain for Mr. Ornstein and his immediate family (spouse, children and spouses and children of children) the right to fly on a complimentary basis on the aircraft of other airlines; •  provide complimentary travel to Mr. Ornstein and his immediately family on the Company aircraft, during the life of each such person; •  provide to Mr. Ornstein, for his personal or business use and at no cost to Mr. Ornstein, any Company aircraft for up to 100 flight hours per calendar year; •  reimburse Mr. Ornstein for his out-of-pocket expenses incurred in connection with the retention by Mr. Ornstein of professional income tax, estate planning and investment advisory services up to a maximum of $10,000 in 2004 and $5,000 per year thereafter; and •  provide security services as are reasonably necessary for the protection of Mr. Ornstein’s life and property, and the lives and property of Mr. Ornstein’s immediate family. If any payments received by Mr. Ornstein under his employment agreement are treated as excess parachute payments and are subjected to the excise tax imposed by Section 4999 of the Internal Revenue Code, Mr. Ornstein is also entitled to receive “gross up” payments sufficient to cover the excise tax. Disability and Death Benefits The agreement provides that upon Mr. Ornstein’s disability, as defined in the agreement, he will receive, on a monthly basis, his base salary, plus an annualized amount equal to his historical bonuses. The Company will make such disability payments for as long as the disability lasts, up to the later of 48 months or the term of Mr. Ornstein’s agreement (currently March 30, 2012), and payments will continue to be made even if they extend beyond the term of the agreement. The Company is required to fund a portion of the payments with disability insurance. In addition, upon Mr. Ornstein’s death or disability, the Company is obligated to pay for amounts earned through the last effective date of his employment, including base salary, incentive bonus, expenses, benefits and for the benefits or perquisites enumerated above. In addition, Mr. Ornstein or his estate, as applicable, can convert all vested restricted stock units outstanding in accordance with the restricted stock award agreement and exercise all vested unexercised stock options and warrants outstanding. 25 Other Severance Benefits Mr. Ornstein’s employment agreement also provides him with certain benefits upon termination, which vary based on the reason of termination. If the Company terminates Mr. Ornstein for “Cause,” or if Mr. Ornstein terminates his employment for any reason other than disability, death or “Good Reason,” in general, Mr. Ornstein will not be entitled to any additional severance payments beyond amounts earned through the last effective date of his employment, but all vested restricted shares can be converted (with all unvested restricted stock units continuing to vest) and all vested unexercised options and warrants outstanding can be exercised. “Cause” is defined as any of (i) Mr. Ornstein’s willful misconduct with respect to the Company’s business that results in a material detriment to the Company, (ii) Mr. Ornstein being convicted of, or entering a plea of no contest, with respect to a felony offense or (iii) in general, the continued failure by Mr. Ornstein to perform his job duties following notice and an opportunity to cure. Mr. Ornstein may terminate the agreement following the occurrence of an event constituting “Good Reason.” “Good Reason” is defined as the occurrence of any of the following circumstances: (i) any change by the Company in Mr. Ornstein’s title, or any significant diminishment in his function, duties or responsibilities, (ii) any reduction in Mr. Ornstein’s salary, bonus opportunity or benefits (other than across the board reductions), (iii) relocation of Mr. Ornstein’s principal place of employment greater than 50 miles from its current location or (iv) any material uncured breach of the agreement by the Company. If Mr. Ornstein’s employment is terminated by Mr. Ornstein for “Good Reason,” then, in addition to receiving payments for amounts earned but not paid through the last effective date of Mr. Ornstein’s employment: •  the Company is required to pay Mr. Ornstein an amount equal to three times his combined annual salary and bonus; •  all of Mr. Ornstein’s non-vested restricted stock units and options would immediately vest; and •  the Company must maintain in full force and effect, for Mr. Ornstein and his eligible beneficiaries, all general benefits for a period of 36 months, unless substantially equivalent benefits are available from another employer. If Mr. Ornstein’s employment is terminated by the Company without Cause (as defined in the agreement)“Cause” or there is a Change“Change in Control (asControl” (known as “single trigger” payments) the following occurs: •  the Company is required to pay Mr. Ornstein an amount equal to six times his combined annual salary and bonus; •  all of Mr. Ornstein’s non-vested restricted stock units and options would immediately vest; and •  the Company must maintain in full force and effect, for Mr. Ornstein and his eligible beneficiaries, all general benefits for a period of 36 months, unless substantially equivalent benefits are available from another employer. A “Change of Control” is generally defined as (i) “person,” as used in Sections 13(d) and 14(d)(2) of the agreement),Securities Exchange Act of 1934, as amended, acquiring 30% or more of the voting power of the Company’s outstanding voting securities, (ii) a change of 60% or more of the Company’s Board of Directors other than by stockholder vote, (iii) consummation of a merger or other disposition transaction of the Company is required to pay Mr. Ornstein an amount equal to six times his combined annual salary and bonus. Additionally, allor (iv) the sale or disposition of his non-vested stock would immediately vest. If Mr. Ornstein’s employment is terminatedany material route system operated by Mr. Ornstein for Good Reason, the Company is required to pay Mr. Ornstein an amount equal to three times his combined annual salary and bonus and all of his non-vested stock would immediately vest. If Mr. Ornstein’s employment is terminated by him voluntarily for no Good Reason or in the absence of a Change in Control, he will not be entitled to any additional severance payments beyond amounts earned through the last effective date of his employment. Company. In addition, the Company has agreed to enter into a consulting agreement with Mr. Ornstein, which will become effective when he leaves the Company for any reason. The consulting agreement will provide for Mr. Ornstein’s retention as a consultant for a period of 7 years from its effective date at the rate of $200,000 per year.      If any payments received by Under the terms of the Consuling Agreement, the Company must use its reasonable efforts to obtain for the benefit of Mr. Ornstein underand his immediate family (i.e., spouse, children, and the agreement are treated as excess parachute paymentsspouse and are subjectedchildren of any of his children), the right to fly on a complimentary basis on the excise tax imposed by Section 4999aircraft of the Internal Revenue Code,other airlines, on a positive space basis. The Company is also required to provide to Mr. Ornstein is entitledand his immediate family, during the life of each such 26 individual, the right to receive “gross up” payments sufficientfly on a complimentary basis on any aircraft operated by the Company or any affiliate at any time (subject to cover the excise tax. reasonable and customary rules regarding availability), on a positive space basis. President and Chief Operating Officer and Chief Accounting Officer Employment Agreement Effective as of March 31, 2004, Michael J. Lotz and the Company entered into a new employment agreement, in which Mr. Lotz agreed to serve as the President and Chief Operating Officer of the Company for a term of five (5) years ending March 30, 2009. Under Mr. Lotz’s agreement, he will receive an annual base salary of $250,000 effective March 31, 2004, which amount shall be increased by $75,000 onOn November 20, 2007, the first and second anniversary dates.      The base salary is subject to annual discretionary increases upon review by the Board. Mr. Lotz also is entitled to an annual bonus, paid quarterly based on annual performance criteria as set forth in the agreement, which may range from $40,000 to $320,000. Additionally, the Board may approve discretionary bonuses. Upon execution of the agreement and on March 31st of each year thereafter duringCompensation Committee approved extending the term of thethis agreement the Company is obligated to contribute an amount equal to his base salary, as deferred compensation, to an account for the benefitMarch 30, 2012. The terms of Mr. Lotz. The Company also is obligated to provide Mr. Lotz with $2,000,000 of term life insurance, the limited use of Company aircraft, and other customary fringe benefits. 14 Mr. Lotz’s employment agreement also provides forare substantially similar to the initial grantterms of stock options to purchase 100,000 shares of Common Stock, with the options vesting in one-third increments over a three-year period, and additional annual option grants of 100,000 shares throughout the term of the agreement. The option exercise price for each option is determined by the market price for the Common Stock on the date the option is granted.      Additionally, Mr. Lotz’s agreement provided for the payment of a retention bonus in the amount of $1,485,000 on the date of the agreement.      Mr. Lotz’sOrnstein’s employment agreement, also provides for the initial grant of 190,141 shares of restricted Common Stock, with the stock vesting in one-third increments over a three-year period beginning on March 31, 2005.      The agreement provides that upon Mr. Lotz’s disability,except as defined in the agreement, Mr. Lotz will receive on a monthly basis, his base salary, plus an annualized amount equal to his historical bonuses. The Company will make such disability payments for as long as the disability lasts, up to 48 months, and payments will continue to be made even if they extend beyond the term of the agreement. The Company is required to fund a portion of the payments with disability insurance.      Mr. Lotz may terminate the agreement following the occurrence of an event constituting “Good Reason.” “Good Reason” is defined as the occurrence of any of the following circumstances: (i) any change by the Company in Mr. Lotz’s title, or any significant diminishment in his function, duties or responsibilities, (ii) any reduction in Mr. Lotz’s salary, bonus opportunity or benefits (other than across the board reductions), (iii) relocation of Mr. Lotz’s principal place of employment greater than 50 miles from its current location, or (iv) any material uncured breach of the agreement by the Company.      If Mr. Lotz’s employment is terminated by the Company without Cause (as defined in the agreement) or there is a Change in Control (as defined in the agreement), the Company is required to pay Mr. Lotz an amount equal to six times his combined annual salary and bonus. Additionally, all of his non-vested stock would immediately vest. If Mr. Lotz’s employment is terminated by Mr. Lotz for Good Reason, the Company is required to pay Mr. Lotz an amount equal to three times his combined annual salary and bonus and all of his non-vested stock would immediately vest. If Mr. Lotz’s employment is terminated by him voluntarily for no Good Reason or in the absence of a Change in Control, he will not be entitled to any additional severance payments beyond amounts earned through the last effective date of his employment.      In addition, the Company has agreed to enter into a consulting agreement with Mr. Lotz, which will become effective when he leaves the Company for any reason. The consulting agreement will provide for Mr. Lotz’s retention as a consultant for a period of 7 years from its effective date at the rate of $150,000 per year.      If any payments received by Mr. Lotz under the agreement are treated as excess parachute payments and are subjected to the excise tax imposed by Section 4999 of the Internal Revenue Code, Mr. Lotz is entitled to receive “gross up” payments sufficient to cover the excise tax. follows: •  Mr. Lotz’s annual base salary will start at $250,000, increasing by $75,000 on the first and second anniversary dates; •  Mr. Lotz will be entitled to an incentive bonus that may range from $40,000 to $320,000 annually, and Mr. Lotz received a one-time retention bonus of $1,485,000; •  Mr. Lotz is entitled to generally the same benefits and perquisites as Mr. Ornstein, except that the Company is only required to maintain a term life policy with a $2,000,000 benefit for Mr. Lotz and Mr. Lotz is only entitled to 50 hours of use of Company aircraft per year; •  Mr. Lotz received an initial grant of stock options to purchase 100,000 shares of common stock (with the options vesting in one-third increments over a three-year period) and was entitled to receive additional annual option grants of 100,000 shares throughout the term of the agreement, and Mr. Lotz entered into a restricted stock agreement with the Company whereby he received 33,003 shares of restricted stock of the Company in lieu of receiving 100,000 options for the contract year beginning January 1, 2006; •  Mr. Lotz received an initial grant of 190,141 shares of restricted common stock, with the stock vesting in one-third increments over a three-year period beginning on March 31, 2005; and •  Mr. Lotz’s consulting agreement provides for payments at a rate of $150,000 per year over a seven year period and the same airline flight benefits described above for Mr. Ornstein. Executive Vice President and CFOGeneral Counsel Employment Agreement      Effective December 6, 2001, George Murnane III and the Company entered into an employment agreement, in which Mr. Murnane agreed to serve as Executive Vice President of the Company for a term of four (4) years ending December, 2005. In February 2003, Mr. Murnane was appointed Chief Financial Officer of the Company. Mr. Murnane receives a base salary of $200,000. The base salary is subject to increases in the Consumer Price Index, and is subject to annual discretionary increases upon review by the Board. Mr. Murnane is also entitled to an annual bonus paid quarterly based on annual performance criteria as set forth in the agreement, which may range from $40,000 to $180,000. The Company also is obligated to provide Mr. Murnane with $2,000,000 of term life insurance and other customary fringe benefits. 15      Mr. Murnane’s employment agreement also provides for the initial grant of stock options to purchase 150,000 shares of Common Stock, with the options vesting in one-third increments over a three-year period, and additional annual option grants of not fewer than 40,000 shares throughout the term of the agreement. The option exercise price for each option is determined by the market price for the Common Stock on the date the option is granted.      The agreement provides that upon Mr. Murnane’s disability, as defined in the agreement, Mr. Murnane will receive on a monthly basis, his base salary, plus an annualized amount equal to his historical bonuses. The Company will make such disability payments for as long as the disability lasts, up to 48 months, and payments will continue to be made even if they extend beyond the term of the agreement. The Company is required to fund a portion of the payments with disability insurance.      Mr. Murnane may terminate the agreement following the occurrence of an event constituting “Good Reason.” “Good Reason” is defined as the occurrence of any of the following circumstances: (i) any change by the Company in Mr. Murnane’s title, or any significant diminishment in his function, duties or responsibilities and (ii) any material uncured breach by the Company or relocation of Mr. Murnane outside Maricopa County without prior written consent.      If Mr. Murnane’s employment is terminated (a) by the Company without Cause (as defined in the agreement) or (b) by Mr. Murnane for Good Reason, the Company is required to pay all normal accrued amounts plus pay Mr. Murnane the greater of (i) salary and bonus payments calculated at the threshold level and (ii) salary and bonus payment, calculated at the minimum level, equal to two years of service. Upon termination by the Company or by Mr. Murnane following a Change in Control (as defined in the agreement), the Company must pay all normal accrued amounts plus payment representing four years of salary and bonus calculated at the minimum level, with an agreed minimum payment of at least one million dollars.      If any payments received by Mr. Murnane under the agreement are treated as “golden parachute” payments and are subjected to the excise tax imposed by Section 4999 of the Internal Revenue Code, Mr. Murnane is entitled to receive “gross up” payments sufficient to cover the excise tax. Other Employment Agreements Upon his appointment as Vice President and General Counsel in 2001, Mr. Gillman and the Company entered into an employment agreement. Upon his appointment as Senior Vice President — East Coast Operations, the Company amended its employment agreement, which was replaced with a new agreement on April 30, 2005. The Compensation Committee approved amendments to Mr. LeakeGillman’s agreement on November 20, 2007. Under Mr. Gillman’s agreement, Mr. Gillman receives a minimum base salary of $135,000, which increased to reflect his new duties. Both of these employment agreements provide$190,000 effective November 15, 2007. Mr. Gillman’s agreement provides for cash and non-cash compensation. Mr. Leakecompensation and Mr. Gillman receive base salaries of $125,000, and arehe is eligible to receive quarterly bonuses of varying minimum amounts ranging from 30% to 100% of their respectivehis base salaries. Further, these employment agreements differ fromsalary. Mr. Ornstein’sGillman’s agreement also provides for a minimum annual option grant of 20,000 shares throughout the term of the agreement, which for 2005 and thereafter was set at 30,000 shares. On July 14, 2006, Mr. Lotz’sGillman entered into a restricted stock agreement with respect to lump sum payments due to each of them upon termination by the Company without Good Cause or by eitherwhereby he received 9,901 shares of them for Good Reason and with respect to the retentionrestricted stock of either of them as consultants thereafter. COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION      The Compensation Committee consists of three non-employee directors, Mr. Altobello, Mr. Beleson and Ms. Silcock. The Compensation Committee has the responsibility for allocation of cash compensation and stock options to senior executive officers of the Company. The Compensation Committee primarily administers the Company’s cash compensation plans and employee stock option plans. In those instances in which Rule 16b-3 of the Securities Exchange Act of 1934 requires grants or awards of stock options to be made by a “disinterested” committee, the Compensation Committee is solely responsible for the administration of such plans.      The entire Board regularly reviews the Compensation Committee decisions relating to executive compensation. The Company’s executive compensation policies, as endorsed by the Compensation Committee, have been designed to provide a balanced compensation program that will assist the Company in its efforts 16 to attract, motivate and retain talented executives wholieu of receiving 30,000 options for the Compensation Committee and senior management believe are important tocontract year beginning April 30, 2006. The amount of restricted stock was based on the long-term financial successnet value of the Company. The employment contracts of Messrs. Ornstein, Lotz and Murnane provide for bonuses. Bonuses are limited to prescribed percentages of base salary, based upon the percentage growth in earnings per share (“EPS”) of the Company. Growth in EPS is categorized at four levels: (1) Minimum — any growth in EPS during the prior fiscal year; (2) Threshold — 5.0% to 9.9% growth in EPS; (3) Target — 10.0% to 14.9% growth in EPS; and (4) Maximum — 15.0% or greater growth in EPS. The Board may also approve discretionary bonuses. In addition to salaries and bonuses, an integral part of executive compensation is the issuance of stock30,000 options on an annualized basis to key employees under the Key Officer Stock Option Plan and the 1996 Stock Option Plan (together, the “Stock Option Plans”).      The Key Officer Stock Option Plan provides for options to be issued to the CEO and President at set dates for prescribed amounts. The 1996 Stock Option Plan provides for options to be issued to officers and key employees at the discretion of the Compensation Committee upon recommendation by the Chief Executive Officer. The options granted under the foregoing Stock Option Plans vest at the rate of approximately one-third per year commencing one year after the grant date. The options have a 10-year term and are subject to standard option provisions, including the requirement of continued employment and provisions to deal with termination of employment due to retirement, death or disability. Under the Stock Option Plans, options will be issued at the weighted average price of Common Stock on the date of grant. The total number of options granted under all Stock Option Plansgrant and vest in fiscal 2004 was 430,220. Theone-third increments over a three-year period. On November 20, 2007, the Compensation Committee believes thatapproved adding a provision entitling Mr. Gillman to, upon the issuanceexecution of stock optionsthe amendment and on each March 31 thereafter during the term of the agreement, deferred compensation in the amount of $50,000. Mr. Gillman is also entitled to officersfringe benefits including, but not limited to, medical and key employees relatedother insurance benefits and positive space airline travel benefits on the Company’s airline. The Company is also required to use commercially reasonable efforts to obtain from other airlines the same travel benefits as the Company provides to its other executives. 27 Upon Mr. Gillman’s death, Mr. Gillman’s estate will be entitled to only such base salary and bonus earned, but not yet paid, as would have otherwise been payable to Mr. Gillman. Upon Mr. Gillman’s temporary disability, Mr. Gillman is entitled to receive base salary plus any cash bonus earned, less benefits received through disability insurance. Upon permanent disability, Mr. Gillman is entitled to receive, for a minimum of 24 months, base salary plus an amount equal to the appreciationminimum bonus to which Mr. Gillman would otherwise be entitled, less premiums paid by the Company for disability insurance that inures to the benefit of Mr. Gillman. Mr. Gillman is also entitled to certain limited severance benefits. If Mr. Gillman terminates his employment other than for “Good Reason” by providing 90 days prior notice, he will be entitled to receive only the base salary payable through the end of the Common Stock provides equitable incentivesmonth in which the 90 day period ends. “Good Reason” includes (i) the assignment of Mr. Gillman to increaseduties substantially inconsistent with his positions or a substantial reduction of his duties, (ii) the profitabilityremoval of any of Mr. Gillman’s titles, (iii) any breach by the Company of Mr. Gillman’s employment agreement, (iv) a “Change of Control” or (v) the relocation of Mr. Gillman or his office, facilities or personnel to a metropolitan area with less than 1,000,000 people. A “Change of Control” is defined as (i) a change of control that would otherwise be required to be reported to the Securities and Exchange Commission on a Current Report onForm 8-K, (ii) the acquisition by a person of beneficial ownership of securities comprising 25% or more of the Company. Compensationvoting power of Chief Executive Officer      We used the same factors and criteria described aboveCompany’s outstanding securities, (iii) a sale of all or substantially all of the Company’s assets, (iv) the Company adopting a plan of dissolution or liquidation or (v) the Company engaging in making compensation decisions regarding our Chief Executive Officer during fiscal 2004. Duringa merger such that less than 75% of the 2004 fiscal year, Mr. Ornstein was compensated pursuant to an employment agreement that was effective commencing March 14, 2001, which agreement was replaced with a new five-year employment that became effective March 31, 2004. During fiscal 2004, Mr. Ornstein’s annual base salary was increased from $200,000 to $300,000 under his new employment agreement and he also earned a performance bonusexisting shareholders of $420,000. Mr. Ornstein’s performance bonus was determined in accordance with the EPS growth criteria described above. In consideration for entering intoCompany are shareholders of the new five-year employment agreement and waiving certain rights underCompany following the priormerger. Under the employment agreement, Mr. Ornstein wasGillman can terminate his employment at any point up to one year after an event constituting “Good Reason” and Mr. Gillman will be entitled to the sum of (i) three times his base salary, (ii) the highest annual bonus amount received by Mr. Gillman during the preceding three years, (iii) deferred compensation payments that would have otherwise been payable had employment not been terminated, (iv) any other cash or other bonus earned prior to the date of termination but not yet paid a retention bonus of $1,860,000 and was granted 238,156 shares of restricted common stock, which consideration was received upon(v) tax gross up payments necessary to discharge tax liabilities. If the effectivenessCompany terminates Mr. Gillman’s employment for “Good Cause,” Mr. Gillman is entitled only to base salary earned prior to the effective date of the new five-year employment agreement. For additional information concerning Mr. Ornstein’s employment agreement, see “Employmenttermination but not yet paid and Change in Control Arrangements,” above.      In establishing the level of base salary payable to Mr. Ornstein under his new employment agreement, we consulted with an independent third party and considered other available information. We took into accountany cash bonus compensation levels payable to executives in our industry and reviewed executive compensation information with regard to comparably-sized companies. We further considered the increasingly active market (and correspondingly increased cash and equity compensation levels) for executives with established track records, and potential costsearned but not paid prior to the Company if replacement management executives were required. We also took into account information concerning employment opportunities with third parties availableeffective date of the termination. “Good Cause” includes (i) personal dishonesty, (ii) willful misconduct, (iii) breach of fiduciary duty involving personal profit, (iv) intentional failure to Mr. Ornstein, and the importanceperform stated duties, (v) willful violation of retaining Mr. Ornstein’s services in areas such as operational leadership and continuing interactions with stakeholders. We continue to consider market conditions with respect to the compensation of all of our executives. COMPENSATION COMMITTEE Daniel J. Altobello Julie Silcock Robert Beleson 17 CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS      In February 1999, the Company entered into an agreement with Barlow Capital, LLC (“Barlow”), whereby Barlow would provide financial advisory services related to aircraft leases, mergers and acquisitions, and certain other financing arrangements. The Company paid fees totaling $2.5 million to Barlow in fiscal 2004 for arranging for leasing companies to participatematerial law, rule or regulation resulting in the Company’s various aircraft financings under this agreement. At September 30, 2004 Jonathan Ornstein,detriment or reflecting upon the Company’s Chairmanintegrity or (vi) a material breach by Mr. Gillman of his employment agreement. If the BoardCompany terminates Mr. Gillman’s employment without “Good Cause,” Mr. Gillman is entitled to a lump sum cash payment equal to the sum of (i) the base salary and Chief Executive Officer,(ii) the highest annual bonus received by Mr. Gillman during the preceding three years, or the minimum amount of any similar bonus then in effect if greater, plus any other cash or other bonus compensation earned prior to the date of such termination pursuant to the terms of all incentive compensation plans then in effect and George Murnane III, the Company’sadditional payments necessary to discharge tax liabilities. Former Executive Vice President and Chief Financial Officer Employment Agreement Effective December 31, 2005 the Company entered into a new employment agreement with its former Chief Financial Officer, George Murnane III. Under the terms of the employment agreement, Mr. Murnane agreed to serve as Executive Vice President and Chief Financial Officer of the Company for a term of five (5) years ending December 30, 2010. Mr. Murnane was terminated for cause on November 5, 2007. As a result of this “for cause” termination, Mr. Murnane is not entitled to any severance compensation. 28 POTENTIAL PAYMENTS UPON TERMINATION OF EMPLOYMENT The table below outlines the potential payments to Messrs. Ornstein, Lotz and Gillman upon the occurrence of certain termination triggering events assuming a hypothetical effective date of termination of September 30, 2007 and after giving effect to the amendments to their respective employment agreements that were approved by the Compensation Committee on November 20, 2007: For purposes of the calculations below, we have used a share value of $4.44 per share, which was the closing price of our common stock on September 28, 2007. The actual amounts to be paid out can only be determined at the time of such executive’s termination from the Company.                                                       Cash     Equity-Based     Consulting     Benefits               Triggering Event   Severance     Compensation     Contract(1)     Continuation(2)     Other(3)     Total(4)     Jonathan G. Ornstein                                                 Termination Without Cause/ Change of Control   $ 8,488,224     $ 146,533 (5)   $ 1,400,000     $ 31,816     $ 565,740     $ 10,632,313   Termination For Good Reason   $ 6,299,112     $ 146,533 (5)   $ 1,400,000     $ 31,816     $ 565,740     $ 8,443,201   Disability   $ 2,918,816       —       —       —     $ 565,740     $ 3,484,556   Death     —       —       —       —     $ 5,000,000 (9)   $ 5,000,000   Michael J. Lotz                                                 Termination Without Cause/ Change of Control   $ 7,344,657     $ 245,687 (6)   $ 1,050,000     $ 31,816     $ 266,700     $ 8,938,860   Termination For Good Reason   $ 5,498,991     $ 245,687 (6)   $ 1,050,000     $ 31,816     $ 266,700     $ 7,093,194   Disability   $ 2,460,878       —       —       —     $ 266,700     $ 2,727,578   Death     —       —       —       —     $ 2,000,000     $ 2,000,000   Brian S. Gillman                                                 Termination Without Good Cause   $ 919,851 (7)   $ 73,704 (8)     —       —       —     $ 993,555   Termination For Good Reason   $ 919,851 (7)   $ 73,704 (8)     —       —       —     $ 993,555   Termination Other than For Good Reason   $ 47,499       —       —       —       —     $ 47,499   Disability   $ 1,111,500       —       —       —       —     $ 1,111,500   (1) The Company is obligated to enter into consulting agreements with Messrs. Ornstein and Lotz following their departure from the Company for any reason. Each such agreement has a term of seven years and provides for annual consulting payments of $200,000 and $150,000, respectively. (2) Messrs. Ornstein and Lotz are entitled to the continuation of health and welfare benefits for a period of 36 months following their termination in certain circumstances. The amounts in this column reflect an estimate of the value of such benefits based on amounts paid in fiscal 2007. (3) The Company is required to use its reasonable efforts to obtain for Messrs. Ornstein and Lotz and their immediate families (spouse, children and spouses and children of children) the right to fly on a complimentary basis on the aircraft of other airlines during the term of their respective7-year consulting agreements. In addition, the Company is required to provide complimentary travel to each of Messrs. Ornstein and Lotz and their immediate family on Company aircraft, during the life of each such person. Under the SEC’s regulations, we are required to disclose a reasonable estimate applicable to this benefit. Accordingly, we have used the value of the travel benefits for such executives in fiscal 2007 ($18,858 and $8,890 for Messrs Ornstein and Lotz, respectively), increased such amounts by 100% and multiplied that figure by 15 years to arrive at the figure in the above table. 29 (4) Total excludes estimated taxgross-up payments of approximately $2,179,480 and $1,946,888 payable to Messrs. Ornstein and Lotz, respectively, upon termination from the Company. Actual amounts will differ depending on the timing of the termination and reason therefor. (5) Estimated value based on the sum of the (i) difference between exercise price of $6.90 per share and $4.44 per share value as of September 28, 2007, multiplied by 49,999 unvested stock options held by the executive as of such date, and (ii) $4.44 per share value multiplied by 33,003 restricted shares held by the executive as of such date. No value was attributed to out-of-the- money options. (6) Estimated value based on the sum of the (i) difference between exercise price of $6.90 per share and $4.44 per share value as of September 28, 2007, multiplied by 33,333 unvested stock options held by the executive as of such date, and (ii) $4.44 per share value multiplied by 55,335 restricted shares held by the executive as of such date. No value was attributed to out-of- the-money options. (7) Assumes highest federal and state income tax rates forgross-up payment. (8) Estimated value based on the sum of the (i) difference between exercise price of $7.40 per share and $4.44 per share value as of September 28, 2007, multiplied by 9,999 unvested stock options held by the executive as of such date, and (ii) $4.44 per share value multiplied by 16,600 restricted shares held by the executive as of such date. No value was attributed to out-of-the-money options. (9) Amount reflects death benefit under existing life insurance policy maintained by the Company for the benefit of the executive. DIRECTOR COMPENSATION Fees The following fees were paid to Directors who were not employees of the Company during fiscal 2007. Directors who are full-time employees of the Company receive no additional compensation for serving as directors. Board members also are reimbursed for all expenses associated with attending Board or Committee meetings.           Annual Retainer   $ 15,000   Fee for each Board meeting   $ 1,000   Fee for each telephonic Board meeting   $ 500   Fee for each Committee meeting   $ 1,000   Lead Director Retainer   $ 10,000   Compensation Committee Chairman Retainer   $ 10,000   Audit Committee Chairman Retainer   $ 20,000   Additionally, members of Barlowthe Compensation and the Nominating/Corporate Governance Committee receive $750 for each holdin-person meeting and the Chairman of the Nominating/Corporate Governance Committee receives an annual retainer of $10,000 per year. Incentive Plan The Board of Directors adopted an amended and restated Director Incentive Plan on December 15, 2006, which Director Incentive Plan was ratified by the Company’s stockholders on February 6, 2007. Under the amended and restated Director Incentive Plan, each non-employee director receives a 25% membership interest therein. Messrs. Ornstein and Murnane have disposedstandard grant of their membership interest. Distributions to the members arerestricted common stock comprised of a number of shares of restricted stock as determined by the Compensation Committee of the Board of Directors. Each non-employee director will receive the standard grant of restricted common stock on March 1st of each year. Upon being appointed a non-employee director after March 1st, such director is granted a pro-rata portion of the standard grant of restricted common stock and receives a standard grant of restricted common stock pursuant to the plan on March 1st of each succeeding year. The amount of pro-rata options granted to each new non-employee director is calculated by dividing the number of days prior to March 1 by the number of days in the calendar year and multiplying the quotient by the standard restricted stock award as was determined by the Compensation Committee for the relevant year. 30 Other Benefits Each non-employee director, and certain family members of such director, receives free travel on a year-by-year basisMesa Airlines and arefree or reduced-fare travel on certain other partner air carriers at no cost to the Company or the director. The Company believes that the directors’ use of free air travel is “de minimis” and did not based on a member’s percentage interestmaintain any records of non-employee directors’ travel during fiscal 2007. A summary of compensation paid to our non-employee directors in Barlow. Substantially allfiscal 2007 is as follows:                                                               Director Compensation Table — Fiscal Year 2007                               Change in                   Fees                       Pension                   Earned                       Value and                   or                 Non-Equity     Nonqualified                   Paid in     Stock     Option     Incentive Plan     Deferred     All Other             Cash     Awards     Awards     Compensation     Compensation     Compensation     Total   Name   ($)     ($)(1)     ($)     ($)     Earnings     ($)     ($)     Daniel J. Altobello   $ 39,250     $ 27,509       —       —       —       —     $ 66,759   Robert Beleson   $ 41,750     $ 27,509       —       —       —       —     $ 69,259   Carlos E. Bonilla   $ 27,000     $ 27,509       —       —       —       —     $ 54,509   Joseph L. Manson   $ 25,250     $ 27,509       —       —       —       —     $ 52,759   Peter F. Nostrand   $ 43,500     $ 27,509       —       —       —       —     $ 71,009   Maurice A. Parker(2)   $ 1,000       —       —       —       —       —     $ 1,000   Richard R. Thayer   $ 50,750     $ 27,509       —       —       —       —     $ 78,259   (1) Each non-employee director received a grant of 3,663 shares of restricted stock on March 1, 2007. The value in this column is based on grant date fair value determined pursuant to FAS 123R. (2) Mr. Parker’s status as a non-employee director changed in fiscal 2007. Accordingly, he was not eligible to receive such fees. COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION During the fiscal year 2007, the Compensation Committee consisted of Barlow’s revenues are derived from its agreementMessrs. Altobello, Bonilla and Nostrand. None of the members of the committee held any executive officer position or other employment with the Company.      The Company providesprior to or during such service. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS Prior to September 2006, the Company provided reservation services toEurope-By-Air, Inc. The Company billedEurope-By-Air approximately $53,000 and $57,000 during fiscal 2004 for these services during the 2004 fiscal year.2006 and 2005, respectively. The Company did not have any billings in fiscal year 2007. Mr. Ornstein is a major shareholder ofEurope-By-Air. In September 2006,Europe-By-Air stopped using the Company’s reservation services. The Company has useduses the services of the law firmfirms of Baker & Hostetler and Piper Rudnick (formerly Verner Lipfert Burnhard McPherson and Hand) for labor related actions.legal services. The Company paid Piper Rudnick $185,000the firms an aggregate of $0.2 million, $0.3 million and $0.3 million for legal-related services in 2004.fiscal 2007, 2006 and 2005, respectively. Mr. Joseph Manson, a member of the Company’s Board of Directors, is a partner with Baker & Hostetler and a former partner with Piper Rudnick.      During In fiscal 2001, the Company established Regional Airline Partners (“RAP”), a political interest group formed to pursue the interests of regional airlines, communities served by regional airlines and manufacturesmanufacturers of regional airline equipment. RAP has been involved in various lobbying activities related to maintaining funding for the Essential Air Service program under which the Company operates the majority of its Beechcraft 1900 aircraft. Mr. Maurice Parker, a member of the Company’s Board of Directors, is the Executive Director of RAP. During 2004fiscal 2007, 2006 and 2005, the Company paid RAP’s operating costs totaling approximately $241,000.$250,000, $284,000 and $312,000, respectively. Included in this amountthese amounts are the wages and expenses of Mr. Parker, which amounted to $93,000$113,000, $119,000 and $120,000 in fiscal 2004.2005, 2006 and 2007, respectively. Since inception, the Company has financed 100% of RAP’s operations. 31 The Company will enter into future business arrangements with related parties only where such arrangements are approved by a majority of disinterested directors and are on terms at least as favorable as those available from unaffiliated third parties. 18 COMPARISON OF STOCK PERFORMANCE      Set forth below is a graph comparing the five-year cumulative shareholder return on the Common Stock against the five-year cumulative total return on the CRSP Index for NASDAQ Stock Market, U.S. Companies, and the American Stock Exchange Airline Index (the “Peer Group”). The graph assumes an initial investment of $100.00 and reinvestment of dividends, if any. COMPARISON OF STOCK PERFORMANCE                                                   Sep-99 Sep-00 Sep-01 Sep-02 Sep-03 Sep-04  Mesa Air Group     100       89       53       60       181       83    NASDAQ Stock Market (U.S. Companies)     100       133       54       43       65       69    AMEX Airline Index (Peer Group)     100       103       49       23       45       31   RATIFY ADOPTION OF MESA AIR GROUP, INC. 2005 EMPLOYEE STOCK INCENTIVE PLAN (PROPOSAL NO. 2)      At the Meeting, stockholders will be asked to approveShareholder Proposals for Action at the Company’s 2005 Employee Stock Incentive Plan (the “2005 Plan”), which was adopted byNext Annual Meeting A shareholder proposal for shareholder action at the Boardnext Annual Meeting of Directors, subjectShareholders to approvalbe held in 2009, must be received by the Company’s stockholders. TheSecretary at the Company’s Board of Directors considers the 2005 Planoffices no later than November 2, 2008, in order to be importantincluded in the Company’s proxy statement and form of proxy for that meeting. Such proposals should be addressed to the Corporate Secretary, Mesa Air Group, Inc., 410 North 44th Street, Suite 100, Phoenix, Arizona 85008. If a shareholder proposal is introduced at the 2009 Annual Meeting of Shareholders without any discussion of the proposal in the Company’s ability to appropriately compensate its officersproxy statement, and employees asthe shareholder does not notify the Company continues to grow. In this respect,on or before March 3, 2009, as required by the 2005 Plan will serve the objectives previously implemented under the Company’s 1996 Stock Option Plan, as amended (the “1996 Plan”). Substantially allSecurities and Exchange Commission’sRule 14(a)-4(c)(1), of the shares authorized under the 1996 Plan have either been issued or are subjectshareholder’s intent to currently outstanding options or other awards under the 1996 Plan. Vote Required      Approval of the 2005 Plan requires the affirmative vote of a majority of the shares of Common Stock present or represented by proxy and entitled to voteraise such proposal at the Annual Meeting. 19 SummaryMeeting of the New Plan      The following summary of the main features of the 2005 Plan is qualified in its entirety by reference to the complete text of the 2005 Plan, which is set forth as Exhibit B to this Proxy Statement. For purposes of the discussion contained in this Proposal No. 2, a capitalized term shall have the meaning proscribed such term in the 2005 Plan except as otherwise provided.      The 2005 Plan authorizes the grant and issuance of three different types of Awards:      Options (“Stock Options”), which can qualify as “incentive stock options” under the Tax Code or as “non-qualified stock options;”      Restricted Stock, which is stock that is contingent on an employee satisfying conditions, including without limitation continued employment, passage of time or satisfaction of performance criteria; and      Performance Shares, which are performance bonuses paid in either cash or shares.      The 2005 Plan has a number of special terms and limitations, including:      The exercise price for Stock Options granted under the 2005 Plan must at least equal the Shares’ fair market value at the time the Stock Option is granted;      The 2005 Plan expressly states that Stock Options granted under it can not be “repriced,” as defined in the 2005 Plan;      Except for ISOs (see below), 1,500,000 shares; plus, the number of shares subject to awards granted under the Company’s 1996 Stock Option Plan but which are not issued as a result of the cancellation, expiration or forfeiture of such awards (the “1996 Plan Shares”) are proposed to be available for issuance under the 2005 Plan;      However, no more than 1,500,000 shares (provided that such Shares shall not include the 1996 Plan Shares) may be issued pursuant to the exercise of ISOs granted under this Plan; and      Stockholder approval is required for certain types of amendments to the 2005 Plan.      The 2005 Plan is designed to enable the Company to attract, retain and motivate its officers and other key employees, and to further align their interests with those of the stockholders of the Company, by providing for or increasing the proprietary interest of such persons in the Company.      The 2005 Plan has various provisions so that Awards under it may, but need not, qualify for an exemption from the “short swing liability” provisions of Section 16(b) of the Exchange Act pursuant to Rule 16b-3 and/or qualify as “performance based compensation” that is exempt from the $1 million limitation on the deductibility of compensation under Section 162(m) of the Tax Code. However, stockholder approval of the class of eligible participants, the per person annual award limitations and the “Qualifying Performance Criteria” potentially associated with Awards granted under the 2005 Plan are required in order for awards under the 2005 Plan to qualify potentially as “performance based compensation” under Tax Code Section 162(m).      The 2005 Plan’s per person award limitations for purposes of Section 162(m) are the following: (1) the aggregate number of Shares subject to Stock Options granted under the 2005 Plan during any calendar year to any one participant may not exceed 150,000; and (2) the aggregate number of Shares issued or issuable under all Awards other than Stock Options granted under the 2005 Plan during any calendar year to any one participant may not exceed 50,000. In the future, if such limitations are not required under Code Section 162(m),Shareholders, then a change in such limitations shall not be subject to Stockholder approval. Eligibility      Participants in the 2005 Plan can be any person who is an employee or prospective employee of the Company or any Subsidiary. The Compensation Committee of the Board of Directors has not yet determined how many individuals will ultimately participate in the 2005 Plan or the benefits or amounts that will be 20 proxies received by or allocated to eligible participants. While it is generally expected that the same categories of executives and employees who participate under the 1996 Plan will be eligible to participate under the 2005 Plan, Awards may from time to time be granted to employees who are not in these groups but who have otherwise distinguished themselves for their contributions to the Company or who are expected to make significant contributions to the Company. Administration      The 2005 Plan will be administered by the Compensation Committee (the “Committee”) of the Board of Directors, although the Board of Directors may exercise any authority of the Committee under the 2005 Plan in lieu of the Committee’s exercise thereof. The Committee may designate subcommittees and may delegate certain administrative functions to others.      Subject to the express provisions of the 2005 Plan, the Committee has broad authority to administer and interpret the 2005 Plan, including, without limitation, authority to determine who is eligible to participate in the 2005 Plan and to which of such persons, and when, Awards are granted under the 2005 Plan, to determine the number of shares of Common Stock subject to Awards and the exercise or purchase price of such shares under an Award, to establish and verify the extent of satisfaction of any performance goals applicable to Awards, to prescribe and amend the terms of the agreements evidencing Awards made under the 2005 Plan, and to make all other determinations deemed necessary or advisable for the administration of the 2005 Plan.      Notwithstanding any language to the contrary in this Plan, the Committee will ensure that the terms and conditions of any Awards issued will comply with the applicable provision of Code Section 409A or the regulations or other pronouncements thereunder. Stock Subject to the New Plan      Except for ISOs (see above), the aggregate number of Shares that can be issued under the 2005 Plan may not exceed 1,500,000, plus the 1996 Plan Shares. If the outstanding Shares or other securities of the Company, or both, for which the Award is then exercisable or as to which the Award is to be settled shall at any time be changed or exchanged by declaration of a stock dividend, stock split, combination of shares, recapitalization, or reorganization, the Committee may appropriately and equitably adjust the number and kind of Shares or other securities which are subject to the Plan or subject to any Awards theretofore granted, and the exercise or settlement prices of such Awards, so as to maintain the proportionate number of Shares or other securities without changing the aggregate exercise or settlement price, provided, however, that such adjustment shall be made so as to not affect the status of any Award intended to qualify as an ISO or as “performance based compensation” under Section 162(m) of the Code. For purposes of calculating the aggregate number of Shares issued under the 2005 Plan, only the number of shares actually issued upon exercise or settlement of an Award and not delivered to or retained by the Company upon cancellation, expiration or forfeiture of an Award or in payment or satisfaction of the purchase price or exercise price of an Award shall be counted. Awards      The 2005 Plan authorizes the grant and issuance of the following types of Awards: Stock Options, Restricted Stock, and Performance Shares. Stock Options. Subject to the express provisions of the 2005 Plan and as discussed in this paragraph, the Committee has discretion to determine the vesting schedule of Stock Options, the events causing a Stock Option to expire, the number of shares subject to any Stock Option, the restrictions on transferability of a Stock Option, and such further terms and conditions, in each case not inconsistent with the 2005 Plan, as may be determined from time to time by the Committee. The 2005 Plan expressly provides that the Company can not “reprice” Stock Options. The exercise price for Stock Options may not be less than 100% of the fair market value of the Common Stock (as determined pursuant to the 2005 Plan) at the time the Stock Option is granted. The exercise price of an Stock Option may be paid through various means specified by the Committee, including in cash or check, by delivering to the Company shares of Common Stock, by a 21 reduction in the number of shares issuable pursuant to such option, or other commitment to pay, including such a commitment by a stock broker to pay over proceeds from the sale of shares issuable under a Stock Option. Stock Options granted under the 2005 Plan may be either incentive stock options (“ISOs”) qualifying under Section 422 of the Tax Code or non-qualified stock options (“NQSOs”), which are not intended to qualify as ISOs. Restricted Stock. The Committee may make awards of restricted stock to participants, which will be subject to restrictions on transferability and other restrictions as the Committee may impose, including, without limitations on the right to vote restricted stock or the right to receive dividends, if any, on the restricted stock. These awards may be subject to forfeiture upon any conditions or criteria established by the Committee, including without limitation termination of employment or upon a failure to satisfy Qualifying Performance Criteria during the applicable restriction period. In addition, in the discretion of the Compensation Committee, awards of restricted stock may be issued upon participants meeting certain Qualifying Performance Criteria. Performance Shares. Performance Shares is an award to receive a number Shares, the payment of which is contingent upon the participant achieving certain performance standards derived from the Qualifying Performance Criteria, which is described below. Once the conditions and terms for the performance Shares have been met, the Performance Shares shall be payable either in cash or Shares (or both) by reference to the fair market value of the Shares enumerated in the Performance Shares at such times as indicated in the Award. The Committee also may impose restrictions on such Awards, including on its transferability. Qualifying Performance Criteria      Subject to stockholder approval of the 2005 Plan, the performance criteria for any Award that is intended to satisfy the requirements for “performance based compensation” under Code Section 162(m) shall be any one or more of the following performance criteria, either individually, alternatively or in any combination, applied to either the Company as a whole, to a business unit or subsidiary, or based on comparisons of any of the performance measures relative to other companies, either individually, alternatively or in any combination, and measured either annually or cumulatively over a period of years, on an absolute basis or relative to a pre-established target, to previous years’ results or to a designated comparison group, in each case as specified by the Committee in the Award: (a) cash flow, (b) earnings per share or increases of same, (c) earnings before interest, taxes and amortization, (d) return on equity, (e) total stockholder return, (f) share price performance, (g) return on capital or investment, (h) return on assets or net assets, (i) revenue, (j) income or net income, (k) operating income or net operating income, (l) operating profit or net operating profit, (m) operating margin or profit margin, (n) return on operating revenue, (o) pre-tax or after-tax profit levels expressed in either absolute dollars, (p) revenues or revenue growth, (q) economic or cash value added, (r) results of customer satisfaction surveys, (s) other measures of performance, quality, safety, productivity or process improvement, (t) market share, (u) overhead or other expense reduction, (v) departure or on-time arrival performance, and (w) baggage handling. These factors may have a minimum performance standard, a target performance standard and a maximum performance standard. The Committee shall appropriately adjust any evaluation of performance under a Qualifying Performance Criteria to exclude any of the following events that occurs during a performance period: (i) asset write-downs, (ii) litigation or claim judgments or settlements, (iii) the effect of changes in tax law, accounting principles or other such laws or provisions affecting reported results, (iv) accruals for reorganization and restructuring programs and (v) any extraordinary non-recurring items as described in Accounting Principles Board Opinion No. 30 and/or in management’s discussion and analysis of financial condition and results of operations appearing in the Company’s annual report to stockholders for the applicable year. Transferability of Awards and Other Provisions Applicable to Awards      Generally, Awards granted under the 2005 Plan may not be sold, assigned, conveyed, gifted, pledged, hypothecated or otherwise transferred in any manner prior to the vesting or lapse of any and all restrictions applicable thereto. 22      The 2005 Plan has provisions designed so that it qualifies as an “eligible plan” under the margin provisions of Regulation U, by expressly providing that the Committee may, but is not required to, loan the amount necessary to purchase shares and/or pay taxes under any award. The 2005 Plan also provides that the Committee may, but need not, provide that the holder of an Award has a right under an Award to receive a number of shares or cash, or a combination thereof, the amount of which is determined by reference to the value of the Award. Finally, the 2005 Plan does not limit the Company’s right to make other arrangements to provide stock options and other forms of compensation arrangements as it determines appropriate. Amendments and Termination      The Board of Directors may amend, alter or discontinue the 2005 Plan or any agreement evidencing an Award made under the 2005 Plan, but no such amendment shall, without the approval of the stockholders of the Company:      (a) change the maximum number of shares of Common Stock for which Awards may be granted under the this Plan;      (b) reduce the price at which Options may be granted below the price provided for in Section 6.2;      (c) reduce the exercise price of outstanding Options;      (d) extend the term of the this Plan;      (e) change the class of persons eligible to be Eligible Persons or Participants; or      (f) increase the number of shares that are eligible for non-Option Awards.      The Board may amend, alter or discontinue the 2005 Plan or any agreement evidencing an Award made under the 2005 Plan, but no amendment or alteration shall be made which would impair the rights of any Award holder, without such holder’s consent, under any Award theretofore granted; provided that no such consent shall be required if the Committee determines in its sole discretion and prior to the date of any change in control, recapitalization, stock dividend, stock split, reorganization, merger, consolidation or similar type transaction that such amendment or alteration either is required or advisable in order for the Company, the 2005 Plan, or any Award granted, to satisfy any law or regulation or to meet the requirements of any accounting standard.      No Award granted under the 2005 Plan shall be granted pursuant to the 2005 Plan more than 10 years after the date of the Company stockholder’s adoption of the 2005 Plan. Federal Income Tax Consequences The following discussion of the federal income tax consequences of the 2005 Plan is intended to be a summary of applicable federal law as currently in effect. State and local tax consequences may differ, and tax laws may be amended or interpreted differently during the term of the 2005 Plan or of Awards thereunder. Because the federal income tax rules governing Awards and related payments are complex and subject to frequent change, and they depend on the Participant’s individual circumstances, Participants are advised to consult their tax advisors prior to exercise of options or other Awards or dispositions of stock acquired pursuant to Awards. The Stock Options ISOs and NQSOs are treated differently for federal income tax purposes. ISOs are intended to satisfy the requirements of Section 422 of the Code. NQSOs need not satisfy such requirements. ISOs      No taxable income will result to a Participant upon the grant of an ISO. Upon the exercise of an ISO, any excess of the fair market value of the stock over the option price is a tax preference item that may result in the imposition of the alternative minimum tax in the year of exercise. However, if any of such shares are disposed 23 of by the Participant in a disqualifying disposition (see below) in the same taxable year as the exercise, there will be no item of tax preference as to such disposed shares, although the Participant will recognize ordinary income as discussed below. In cases where the exercise of the option does produce an item of tax preference, the basis of the stock for purposes of the alternative minimum tax will include the amount of such tax preference item.      On the subsequent sale of stock acquired by the exercise of an ISO, gain or loss will be recognized in an amount equal to the difference between the amount realized on the sale and the Participant’s tax basis in the stock sold. The tax basis of stock acquired solely for cash will be equal to the amount of cash paid. If an ISO is exercised using previously acquired stock (or stock and cash) in payment, the Participant’s tax basis for the number of stock received equal to the number used in payment shall be the same as the Participant’s basis in the stock used as payment. The Participant’s aggregate tax basis in any additional stock received will be equal to the amount of cash paid (if any).      If a disposition of stock does not take place until more than two years after grant and more than one year after exercise of the option, any gain or loss realized will be treated as long-term capital gain or loss. Under such circumstances, the Company will not be entitled to a deduction for income tax purposes in connection with the exercise of the option. If a disposition occurs within two years after grant or one year after exercise of the option, the difference between the fair market value of the stock on the date of exercise and the tax basis in the stock is taxable as compensation income to the Participant and is deductible by the Company for federal income tax purposes. Any additional amount realized on the disposition2009 Annual Meeting will be taxed as either long-term or short-term capital gain. If the option price of an ISO is paid by using stock that was acquired upon the exercise of an ISO (“Payment Shares”) and the Payment Shares have not been held for more than one year from exercise and two years from grant, the transfer of such Payment Shares to exercise an ISO will be treated as a “disposition” of such Payment Shares. Upon such disposition, the excess of the fair market value of the Payment Shares on the date they had originally been acquired (or, if less, the fair market value of the Payment Shares on the date of disposition) over the Participant’s tax basis in such Payment Shares is taxable as compensation income to the Participant and is deductiblevoted by the Company. NQSO In general, no taxable income will be recognized by the Participant, and no deduction will be allowed to the Company, upon the grant of a NQSO. Upon exercise of an unrestricted NQSO, a Participant will recognize ordinary income (and the Company will be entitled to a corresponding tax deduction)persons named as such proxies in an amount equal to the amount by which the fair market value of the shares on the exercise date exceeds the option exercise price. Any gain or loss realized by a Participant on disposition of such shares generally is a capital gain or loss and does not result in any tax deduction to the Company. Restricted Stock      A grant of restricted stock does not result in income to the Participant or a corresponding tax deduction for the Company until the shares are no longer subject to restrictions, or forfeiture, unless the Participant, elects under Section 83(b) of the Code to have the amount of income to the Participant (and deduction to the Company) determined at the date of the grant. At the time of lapse of restrictions (or a Section 83(b) election), the Participant generally will recognize ordinary income equal to the fair market value of the shares less any amount paid for them, and the Company will be entitled to a tax deduction in the same amount (subject to certain restrictions set forth below under Section 162(m) of the Code. Any dividends paid on restricted stock will be treated as compensation for federal income tax purposes, unless the Participant has made a Section 83(b) election. Any additional gain or loss that is recognized after the restrictions have lapsed (or a Section 83(b) election has been made) will be treated as capital gain. Participants receiving Restricted Stock should consult their tax advisors regarding the ability and advisability of making the Section 83(b) election, including the limitations on claiming a loss if the shares decline in value or are forfeited after receipt. 24 Performance Shares No taxable income generally is reportable when a Performance Share is granted to a Participant. Upon satisfaction of the criteria established by the Committee and upon having the right to receive the cash and/or the Shares based on the timing set by the Committee, the Participant will recognize compensation income in an amount equal to the amount of cash received and the fair market value of any Shares. Any additional gain or loss recognized upon any later disposition of the Shares would be capital gain or loss. Withholding and Other Issues for Employees      The Company generally will be entitled to withhold any required taxes in connection with the exercise or payment of an Award, and may require the participant to pay such taxes as a condition to exercise of an Award. Special rules will apply in cases where a recipient of an Award pays the exercise or purchase price of the Award or applicable withholding tax obligations under the 2005 Plan by delivering previously owned shares or by reducing the number of shares otherwise issuable pursuant to the Award. The surrender or withholding of such shares will in certain circumstances result in the recognition of incomediscretion with respect to such shares or a carryover basis in the shares acquired, and may constitute a disposition for purposesproposal. Notice of applying the ISO holding periods as discussed above. The Committee, pursuantsuch proposal is to be sent to the terms of the agreements or other documents pursuant to which specific Awards are made under the 2005 Plan, may agree to reimburse Participants for some or all of the federal, state and local income taxes associated with the grant or exercise of an Award or the receipt of the cash or Shares from an Award (including any tax imposed under Code Section 409A), or the 20% excise tax on any “excess parachute payments” under Code Sections 280G and Code Section 4999, and may agree to reimburse the additional federal, state and local income tax from the reimbursement payments made.above address.   Tax Effect to Company      The Company generally will be entitled to a tax deduction in connection with an Award under the 2005 Plan in an amount equal to the compensation income (ordinary income) realized by a Participant and at the time the Participant recognizes such income (for example, the exercise of a NQSO). Special rules limit the deductibility of compensation paid to certain Covered Employees of the Company (as defined by Code Section 162(m)(3)). Under Section 162(m) of the Internal Revenue Code, the annual compensation paid to any of these Covered Employees will be deductible only to the extent that it does not exceed $1,000,000 or if the compensation is paid solely on account of attaining one or more pre-established, objective performance goals. The 2005 Plan has been constructed such that some Awards in the Committee’s discretion may qualify as “performance-based compensation” under Section 162(m) of the Code and thus would be deductible even if the total compensation paid to the Covered Employee is in excess of $1,000,000. However, whether an Award will qualify under Section 162(m) as “performance-based compensation” will depend on the terms, conditions and type of the Award issued the Covered Employee. For example, grants of Options or Restricted Stock often vest only according to the optionee’s or Grantee’s length of employment rather than pre-established performance goals. Therefore, the compensation derived from the Awards made to Covered Employees may not be deductible by the Company to the extent the Covered Employee’s total compensation exceeds $1 million. Required Vote      Approval of the 2005 Plan requires the affirmative vote of a majority of shares of Common Stock present at the Annual Meeting in person or by proxy. Abstentions are considered present for this proposal, so they will have the same effect as votes against the 2005 Plan. Broker non-votes are not considered present for this proposal. THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT YOU VOTE “FOR” APPROVAL OF THE 2005 MESA AIR GROUP, INC. EMPLOYEE STOCK INCENTIVE PLAN. 25 RATIFICATION OF SELECTION OF INDEPENDENT REGISTERED PUBLIC ACCOUNTANTS (PROPOSAL NO. 3)      Deloitte & Touche LLP has been selected as the Company’s independent registered public accountants for the fiscal year ending September 30, 2005. Shareholder ratification of the selection of Deloitte & Touche LLP as the Company’s independent registered public accountants is not required by the Company’s Bylaws or otherwise. However, the Board is submitting the selection of Deloitte & Touche LLP for shareholder ratification as a matter of good corporate practice. Deloitte & Touche LLP has audited the Company’s financial statements since 2000. Notwithstanding the selection, the Board, in its discretion, may direct appointment of a new independent accounting firm at any time during the year if the Board feels that such a change would be in the best interests of the Company and its shareholders. A representative of Deloitte & Touche LLP is expected to be present at the Annual Meeting with the opportunity to make a statement if he or she so desires and to be available to respond to appropriate questions.      Ratification of the appointment of Deloitte & Touche LLP as the Company’s independent registered public accountants for fiscal year 2005 will require the affirmative vote of the holders of at least a majority of the outstanding Common Stock represented in person or by proxy at the Annual Meeting. All of the directors and executive officers of the Company have advised the Company that they will vote their shares of Common Stock “FOR” the ratification of the appointment of Deloitte & Touche LLP as the Company’s independent registered public accountants for fiscal year 2005. If the holders of at least a majority of the outstanding Common Stock fail to ratify the appointment of Deloitte & Touche LLP as the Company’s independent registered public accountants, the Audit Committee will consider such failure at a subsequent meeting of the Audit Committee and determine, in its discretion, what actions it should take, if any. THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT YOU VOTE “FOR” RATIFICATION OF THE APPOINTMENT OF DELOITTE & TOUCHE LLP AS THE COMPANY’S INDEPENDENT REGISTERED PUBLIC ACCOUNTANTS FOR FISCAL YEAR 2005. Annual Report The 20042007 Annual Report, which was mailed to shareholders with this proxy statement, contains financial and other information about our activities, but is not incorporated into this proxy statement and is not to be considered a part of these proxy soliciting materials. The information contained in the “Compensation Committee Report on Executive Compensation,” “Report of the Audit Committee of the Board of Directors,” and “Comparison of Stock Performance” in this proxy statement shall not be deemed “filed” with the Securities and of Section 18 of the Securities Act of 1934, and shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended. The Company will provide upon written request, without charge to each shareholder of record as of the Record Date, a copy of the Company’s annual report onForm 10-K for the fiscal year ended September 30, 2004,2007, as filed with the Securities and Exchange Commission.SEC. Any Exhibits listed in theForm 10-K also will be furnished upon request at the Company’s expense. Any such request should be directed to the Company’s Corporate Secretary at the Company’s executive offices at 410 North 44th Street, Suite 700,100, Phoenix, Arizona 85008. Incorporation by Reference Notwithstanding anything to the contrary set forth in any of our previous filings under the securities laws that might incorporate future filings, including this Proxy Statement, in whole or in part, the Compensation Committee Report, the Audit Committee Report, the content ofwww.mesa-air.com, including the charters of the committees of our Board of Directors, our Corporate Governance Guidelines, our Nominating/Corporate Governance Committee Charter, our Audit Committee Charter, our Compensation Committee Charter and our Code of Conduct, included or referenced in this Proxy Statement shall not be incorporated by reference into any such filings. Voting by Proxy In order to ensure that your shares will be represented at the Annual Meeting, please sign and return the enclosed Proxy in the envelope provided for that purpose, whether or not you expect to attend. Any shareholder may, without affecting any vote previously taken, revoke a written proxy by giving notice of revocation to the Company in writing or by executing and delivering to the Company a later dated proxy. By Order of the Board of Directors Jonathan G. Ornstein, Chairman of the Board and Chief Executive Officer 32 26 Shareholder Proposals for Action at the Company’s Next Annual Meeting      A shareholder proposal for shareholder action at the next Annual Meeting of Shareholders to be held in 2006, must be received by the Company’s Secretary at the Company’s offices no later than October 10, 2005, in order to be included in the Company’s proxy statement and form of proxy for that meeting. Such proposals should be addressed to the Corporate Secretary, Mesa Air Group, Inc., 410 North 44th Street, Suite 700, Phoenix, Arizona 85008. If a shareholder proposal is introduced at the 2006 Annual Meeting of Shareholders without any discussion of the proposal in the Company’s proxy statement, and the shareholder does not notify the Company on or before November 29, 2005, as required by the Securities and Exchange Commission’s Rule 14(a)-4(c)(1), of the shareholder’s intent to raise such proposal at the Annual Meeting of Shareholders, then proxies received by the Company for the 2006 Annual Meeting will be voted by the persons named as such proxies in their discretion with respect to such proposal. Notice of such proposal is to be sent to the above address. By Order of the Board of Directors Jonathan G. Ornstein, Chairman of the Board and Chief Executive Officer 27 EXHIBIT A MESA AIR GROUP, INC. AUDIT COMMITTEE CHARTER The role and responsibilities of the Audit Committee of the Board of Directors (the “Committee”) of Mesa Air Group, Inc. (the “Company”) are as follows: Role The Committee’s role is to act on behalf of the Company’s Board of Directors (the “Board”) and oversee all aspects of the Company’s control, reporting and audit functions, except those specifically related to the responsibilities of another standing committee of the Board. The Committee’s role includes a particular focus on the qualitative aspects of financial reporting to shareholders and on Company processes for the management of business/financial risk and for compliance with significant applicable legal, ethical and regulatory requirements. The role also includes coordination with other Board committees and maintenance of strong, positive working relationships with management, external and internal auditors, counsel, and other Committee advisors. Although the Committee has the responsibilities set forth in this Charter, management is responsible for preparing the Company’s financial statements and the independent registered public accountant is responsible for auditing those financial statements. It is not the duty of the Committee to plan or conduct the audit or to determine that the Company’s financial statements are complete and accurate or are in accordance with generally accepted accounting principles. Nothing in this Charter changes, or is intended to change, the responsibilities of management or the independent registered public accountant. Moreover, nothing in this Charter is intended to increase the liability of the members of the Committee beyond that which existed before this Charter or amendments thereto were approved by the Board. Membership Committee membership shall consist of at least three Board members who qualify as independent within the meaning of the Company’s Corporate Governance Guidelines and satisfy the experience and, as affirmatively determined by the Board, the independence requirements of the National Association of Securities Dealers, Inc. (“NASD”) applicable to audit committee members (including, with respect to the chairperson of the Committee, any special requirements applicable to chairpersons of audit committees), as in effect from time to time when and as required by the NASD. Committee members shall have: (1) knowledge of the primary industries in which the Company operates, (2) the ability to read and understand fundamental financial statements, including a balance sheet, income statement, statement of cash flow and key performance indicators; and (3) the ability to understand key business and financial controls. One member, preferably the chairperson, should have the knowledge of financial reporting including applicable regulatory requirements, and accounting or related financial management expertise. The Committee shall have access to its own counsel and other advisors at the Committee’s sole discretion. Committee members shall be nominated and approved annually by the full Board. The Committee members shall elect the Committee chairperson. Operating Activities The Committee shall fulfill its responsibilities within the context of the following activities:   I. Continuous Activities — General 1. Provide an open avenue of communication between the independent registered public accountants, members of senior management, Internal Audit and the Board of Directors. A-1 A-1 2. The Committee shall, on an annual basis, review, assess and report to the Board on the independence of the independent registered public accountants,accountant, taking into account the opinions of members of management and the Company’s internal audit function and including an analysis of all non-audit services provided by the independent registered public accountantsaccountant and the effect, if any, on such independence. In this connection, the Committee shall seek to obtain a written statement from the independent registered public accountant delineating all relationships between the independent registered public accountant and the Company consistent with Independence Standards Board Statement No. 98-1,1, “Independence Discussions with Audit Committees.” Additionally, the Committee should seek to maintain an active dialogue with the independent registered public accountant with respect to disclosed relationships or services that may impact auditor objectivity or independence and should take, or recommend to the full Board, appropriate action to ensure the independence of the independent registered public accountant. The Committee will also establish clear hiring policies for employees or former employees of the independent registered public accountants. accountant. 3. The internal audit function shall be responsible to senior management, but have a direct reporting responsibility and an effective line of communication to the Board through the Committee. 4. Inquire of management, the independent registered public accountant and the Director of Internal Audit about significant risks or exposures and ensure that the yearly audit plan addresses such risk. 5. Review with the independent registered public accountants and the Director of Internal Audit the coordination of the audit efforts to assure completeness of coverage, reduction of redundant efforts, and the effective use of audit resources. 6. Consider and review with the Director of Internal Audit, and the independent registered public accountant: (a)  The adequacy of internal controls, including computerized system controls and security. (b)  Findings and recommendations of the independent registered public accountant and Internal Audit and the related management responses. (c)  Significant findings during the year, including the status of Previous Audit recommendations. (d)  Any difficulties encountered in the course of audit work including any restrictions on the scope of activities or access to required information. (e)  Any changes required in the planned scope of the Internal Audit plan. (f)  The Internal Audit Department charter, budget and staffing. accountants: (a) The adequacy of internal controls, including computerized system controls and security. (b) Findings and recommendations of the independent registered public accountants and Internal Audit and the related management responses. (c) Significant findings during the year, including the status of previous audit recommendations. (d) Any difficulties encountered in the course of audit work including any restrictions on the scope of activities or access to required information. (e) Any changes required in the planned scope of the Internal Audit plan. (f) The Internal Audit Department charter, budget and staffing. 7. Meet four times per year or more frequently as circumstances require, either in person or telephonically. The Committee may ask members of management or others to attend meetings and provide pertinent information as necessary. 8. Meet at least annually with the independent registered public accountant,accountants, the Director of Internal Audit and management, including the Chief Financial Officer, in separate executive sessions to discuss any matters that the Committee or these groups believe should be discussed privately with the Audit Committee. 9. The Committee shall review with management and the outside registered public accountantsaccountant the audited financial statements to be included in the Company’s Annual Report onForm 10-K (or the Annual Report to Shareholders if distributed prior to the filing ofForm 10-K) and review and consider with the outside registered public accountants the matters required to be discussed by Statement of Auditing Standards (“SAS”) No. 61114 andRule 2-07 ofRegulation S-X. 10. As a whole, or through the Committee Chair, the Committee shall review with the independentoutside registered public accountants the Company’s quarterly reports to be filed with the Securities and Exchange Commission and the matters required to be discussed by SAS No. 61114 andRule 2-07; this review will occur prior to the Company’s filing of theForm 10-Q. A-2 11. The Committee shall review and discuss earnings press releases, as well as financial information and earnings guidance provided to analysts and rating agencies. A-2 12. Report periodically to the Board of Directors on significant results of the foregoing activities.   II. Continuous Activities — Re: Reporting Specific Policies 1. Advise financial management and the independent registered public accountants that they are expected to provide a timely analysis of significant current financial reporting issues and practices and other supporting documentation requested by the Committee, for its meetings and deliberations. 2. Require that financial management and the independent registered public accountants discuss with the audit committee their qualitative judgments about the appropriateness, not just the acceptability, of accounting principles and financial disclosures used or proposed to be adopted by the Company and, particularly about the degree of aggressiveness or conservatism of its accounting principles and underlying estimates. 3. Inquire as to the registered public accountants’ independent qualitative judgments about appropriateness, not just the acceptability, of accounting principles and the clarity of the financial disclosure practices used or proposed to be adopted by the Company. 4. Inquire as to the registered public accountants’ views about whether management’s choice of accounting principles are conservative, moderate or aggressive from the perspective of income, asset, and liability recognition, and whether those principles are common practice in the industry. 5. Discuss with the registered public accountants the reasonableness and appropriateness of changes in accounting principles and disclosure practices. 6. The Committee shall obtain from the independent registered public accountant assurance that Section 10A of the Securities Exchange Act of 1934 has not been implicated.   III. Scheduled Activities 1. The Committee shall, on an annual basis, review, assess and report to the Board on the performance and qualifications of the independent registered public accountant and the audit partner. In this respect, the Committee shall seek to obtain a report by the independent registered public accountant describing the firm’s internal quality control procedures and any material issues raised by the most recent internal quality control review, or peer review, of the firm or by any inquiry or investigation by any governmental or professional authorities, within the preceding five years, respecting one or more independent audits carried out by the firm, and any steps taken to deal with any such issues. 2. The Committee shall recommend the selection of the independent registered public accountants for approval by the Board, approve compensation for the independent registered public accountants, and review and approve the discharge of the independent registered public accountant. accountants. 3. Review and approve, in consultation with the independent registered public accountants, the audit scope and plan of the internal audit scope and plan. 4. Review and approve, in consultation with the independent registered public accountants, the audit scope and plan of the independent audit scope and plan. 5. Review with management and the independent registered public accountants the results of annual audits and related comments: (a)  Any significant changes required in the independent registered public accountants’ audit plans. (b)  Any difficulties or disputes with management encountered during the course of the audit. (c)  Other matters related to the conduct of the audit which are to be communicated to the Audit Committee under Auditing Standards Generally Accepted in the United States of America. A-3 (a) Any significant changes required in the independent registered public accountants’ audit plans. (b) Any difficulties or disputes with management encountered during the course of the audit. (c) Other matters related to the conduct of the audit which are to be communicated to the Audit Committee under Auditing Standards Generally Accepted in the United States of America. 6. Review the results of the annual audits of member reimbursements, director and officers’ expense accounts and management perquisites prepared by Internal Audit and the independent registered public accountants respectively. Audit. 7. Arrange for the independent registered public accountants to be available to the full Board at least annually to help provide a basis for the board to recommend the appointment of the independent registered public accountants. A-3 8. Discuss with the registered public accountants the reasonableness of significant estimates made by management. 9. Review and update the Committee’s Charter annually and recommend any proposed changes for approval by the full Board. 10. The Committee shall prepare such reports regarding matters within the scope of the Committee’s role and responsibilities as maybe required to be included in the Company’s annual proxy statement or other public filings under applicable rules and regulations. 11. The Committee shall review and assess, on an annual basis, the Company’s code of ethical conduct and significant conflicts of interest and related-party transactions. 12. The Committee shall establish and maintain procedures for the receipt, retention and treatment of complaints received by the Company regarding accounting, internal accounting controls, or auditing matters. The Committee shall also establish and maintain procedures for the confidential, anonymous submission by employees of the Company of concerns regarding questionable accounting or auditing matters. 13. The Committee shall review, discuss and assess at least annually its own performance as well as the role and responsibilities of the Committee, seeking input from senior management, the full Board and others. Changes in the roleand/or responsibilities of the Committee as outlined in this Charter, if any, shall be recommended to the full Board for approval.   IV. When Necessary Activities 1. Review and concur in the appointment, replacement, reassignment or dismissal of the Director of Internal Audit. 2. Review and approve requests for any management consulting engagement to be performed by the Company’s independent registered public accountants and be advised of any other study undertaken at the request of management that is beyond the scope of the audit engagement letter. 3. The Committee shall review and assess SEC inquiries and the results of examinations by other financial regulatory authorities in terms of important finding,findings, recommendations and management’s response. 4. Conduct or authorize investigations into any matters within the scope of the Committee’s responsibilities. The Committee shall be empowered to retain independent counsel and other professionals to assist in the conduct of any investigations. A-4 A-4 EXHIBIT B 2005 EMPLOYEE STOCK INCENTIVE PLAN OF MESA AIR GROUP, INC. NOMINATING/CORPORATE GOVERNANCE COMMITTEE CHARTER Section 1.     PurposeCOMMITTEE MEMBERSHIP The Corporate Governance/Nominating Committee of Planthe Board of Directors of the Company shall consist of at least three Directors. The members of the Committee and its Chair shall be appointed by the Board and may be removed by the Board at its discretion. All members of the Committee shall, in the Board’s judgment, meet the applicable independence requirements of the National Association of Securities Dealers, Inc. (“NASD”). THE COMMITTEE’S PURPOSE The purpose of this 2005 Employee Stock Incentive Plan (this “Plan”)the Corporate Governance/Nominating Committee is to assist the Board in identifying qualified individuals to become Board members, nominate Directors to serve on and to chair the Board Committees, periodically review director compensation and benefits, and recommend to the Board any improvements to the Company’s corporate governance guidelines as it deems appropriate. The Committee shall also assist the Board in continuing education, new director orientation and assessment of Mesa Air Group, Inc.,board effectiveness. COMMITTEE AUTHORITY AND RESPONSIBILITIES The authority and responsibilities of the Corporate Governance/Nominating Committee are: 1. To lead the search for individuals qualified to become members of the Board. In obtaining the names of possible new nominees, the Committee may make its own inquiries and will receive suggestions from other Directors, stockholders and other sources. All potential nominees must first be considered by the Committee before being contacted as possible nominees and before having their names formally considered by the full Board. 2. To evaluate the suitability of potential nominees for membership on the Board, taking into consideration the Board’s current composition, including expertise, diversity, and balance of inside, outside and independent directors, and considering the general qualifications of the potential nominees, such as: (a) Unquestionable integrity and honesty; (b) The ability to exercise sound, mature and independent business judgment in the best interests of the shareholders as a Nevada corporation (the “Company”), iswhole; (c) Recognized leadership in business or professional activity; (d) A background and experience that will complement the talents of the other Board members (e) Willingness and capability to take the time to actively participate in Board and Committee meetings and related activities; (f) Ability to work professionally and effectively with other Board members and the Company’s management; (g) An age to enable the Company Director to remain on the Board long enough to make an effective contribution; (h) Lack of realistic possibilities of conflict of interest or legal prohibition. and any subsidiary corporation (assee that all necessary and appropriate inquiries are made into the term is definedbackgrounds of such candidates. 3. To recommend to the Board the number and names of proposed nominees for election as Director at the Annual Meeting of Shareholders and, in Code Section 424(f), hereinafter eachthe case of a “Subsidiary” orvacancy on the plural “Subsidiaries”)Board, the name of an individual to attract, retainfill the vacancy. B-1 4. To monitor trends and motivate their officersbest practices in corporate governance, periodically review the corporate governance guidelines and recommend changes as it deems appropriate in those guidelines, in the corporate governance provisions of the Company’s By-Laws, and in the policies and practices of the Board, including: (a) Retirement age and resignation policies; (b) Other board service, conflict of interest issues and other key employees,affiliations; (c) Schedule, agendas and conduct of executive sessions. 5. To annually review and make recommendations to further align the interests of such persons with thoseBoard regarding its process for evaluating the effectiveness of the stockholdersBoard and its Committees. The Committee shall oversee the annual assessment of board effectiveness and report to the Board. 6. To periodically review and make recommendations to the Board regarding new Director orientation and Director continuing education. 7. To annually recommend to the Board following the annual meeting of shareholders, committee membership and chairs and review periodically with the Board Committee rotation practices. COMMITTEE MEETINGS. SUPPORT AND EVALUATION The Corporate Governance/Nominating Committee shall meet at least two times a year, or more often as circumstances require, keep minutes of its proceeding and report regularly to the Board. The Corporate Governance/Nominating Committee may invite to its meetings any director, officer of the Company by providingor such other person as it deems appropriate to assist it in performing its responsibilities, and has the authority to retain independent search or other consultants to assist it in identifying potential Director nominees, and to terminate any such search, in its sole discretion, and to approve related fees and other retention provisions. The Corporate Governance/Nominating Committee shall conduct and present to the Board an annual performance evaluation of the Committee. The Committee shall review annually the adequacy of this charter and recommend any changes that it deems appropriate to the Board for or increasing the proprietary interest of such persons in the Company.approval. B-2 Section 2.     Administration of PlanEXHIBIT C 2.1     Composition of Committee. This Plan shall be administered by theMESA AIR GROUP, INC. COMPENSATION COMMITTEE CHARTER The Compensation Committee of the Board of Directors (the “Committee”), asof Mesa Air Group, Inc. will consist of a minimum of three (3) directors. Members of the Committee will be appointed from time to time by the Board of Directors. The Board of Directors shall fill vacancies on, and from time to time may remove or add members to,be removed by the Committee. The Committee shall act pursuant to a majority vote or unanimous written consent. The Board of Directors in its sole discretion, may exercise any authoritydiscretion. All members of the Committee under this Plan in lieuwill be independent directors, and will satisfy the proposed NASDAQ standard for independence for members of the Committee’s exercise thereof. NotwithstandingCompensation Committee. The purpose of the foregoing,Committee will be to carry out the Board of Directors’ overall responsibility relating to executive compensation. In furtherance of this purpose, the Committee will have the following authority and responsibility. 1. To assist the Board in developing and evaluating potential candidates for executive positions, including the chief executive officer, and to oversee the development of executive succession plans. 2. To review and approve on an annual basis the corporate goals and objectives with respect to any Award that is not intended to satisfycompensation for the conditionschief executive officer. The Committee will evaluate at least once a year the chief executive officer’s performance in light of Rule 16b-3 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”) or Section 162(m)(4)(C) of the Internal Revenue Code of 1986, as amended (the “Code”),these established goals and objectives. Based upon these evaluations, the Committee may appoint one or more separate committees (any such committee, a “Subcommittee”) composed of one or more directors ofwill review the Company (who may but need not be members ofchief executive officer’s annual compensation, including salary, bonus, incentive and equity compensation. 3. To review and approve on an annual basis the Committee)evaluation process and may delegate to any such Subcommittee(s)compensation structure for the authority to grant Awards, as defined in Section 5.1 hereof, under the Plan to Eligible Persons, to determine all terms of such Awards, and/or to administer the Plan or any aspect of it. Any action by any such Subcommittee within the scope of such delegation shall be deemed for all purposes to have been taken by the Committee.Company’s senior officers. The Committee may designate the Secretary of the Company or other Company employees to assist the Committee in the administration of the Plan, and may grant authority to such persons to execute agreements or other documents evidencing Awards made under this Plan or other documents entered into under this Plan on behalf of the Committee or the Company. 2.2     Powers of the Committee. Subject to the express provisions of this Plan, the Committee shall be authorized and empowered to do all things necessary or desirable, in its sole discretion, in connectionwill evaluate with the administration of this Plan, including, without limitation,CEO the following:      (a) to prescribe, amend and rescind rules and regulations relating to this Plan and to define terms not otherwise defined herein; provided that, unless the Committee shall specify otherwise, for purposes of this Plan (i) the term “fair market value” shall mean, as of any date, the closing price for a Share (as defined in Section 3.1) reported for the last trading day prior to such date by the Nasdaq Stock Market (or such other stock exchange or quotation system on which Shares are then listed or quoted) or, if no Shares are traded on the Nasdaq Stock Market (or such other stock exchange or quotation system) on the date in question, then for the next preceding date for which Shares traded on the Nasdaq Stock Market (or such other stock exchange or quotation system); and (ii) the term “Company” shall mean the Company and its Subsidiaries, unless the context otherwise requires;      (b) to determine which persons are Eligible Persons (as defined in Section 4), to which of such Eligible Persons, if any, Awards shall be granted hereunder and the timing of any such Awards, and to grant Awards;      (c) to grant Awards to Eligible Persons and determine the terms and conditions thereof, including the number of Shares subject to Awards and the exercise or purchase price of such Shares and the B-1 circumstances under which Awards become exercisable or vested or are forfeited or expire, which terms may but need not be conditioned upon the passage of time, continued employment, the satisfaction of performance criteria, the occurrence of certain events (including events which the Board or the Committee determine constitute a change of control), whether such Award complies with Code Section 409A and Notice 2005-1 or other factors;      (d) to establish, verify the extent of satisfaction of, adjust, reduce or waive any performance goals or other conditions applicable to the grant, issuance, exercisability, vesting and/or ability to retain any Award;      (e) to prescribe and amend the terms of the agreements or other documents evidencing Awards made under this Plan (which need not be identical);      (f) to determine whether, and the extent to which, adjustments are required pursuant to Section 10;      (g) to interpret and construe this Plan, any rules and regulations under this Plan and the terms and conditions of any Award granted hereunder, and to make exceptions to any such provisions in good faith and for the benefit of the Company; and      (h) to make all other determinations deemed necessary or advisable for the administration of this Plan. 2.3     Determinations of the Committee. All decisions, determinations and interpretations by the Committee regarding this Plan shall be final and binding on all Eligible Persons and Participants. The Committee shall consider such factors as it deems relevant to making such decisions, determinations and interpretations including, without limitation, the recommendations or advice of any director, officer or employee of the Company and such attorneys, consultants and accountants as it may select. Section 3.     Stock Subject to Plan 3.1     Aggregate Limits. The aggregate number of shares of the Company’s Common Stock, no par value (“Shares”), issued pursuant to all Awards granted under this Plan shall not exceed 1,500,000; plus,senior executive officers and will approve the numberannual compensation, including salary, bonus, incentive and equity compensation, for such senior executive officers. The Committee will also provide oversight of shares equalmanagement’s decisions concerning the performance and compensation of other Company officers. 4. To review the Company’s incentive compensation and other equity plans and recommend changes in such plans to the number of shares subject to awards granted underBoard as needed. The Committee will have and will exercise all the Company’s 1996 Stock Option Plan but ultimately which are not issued under such plan as a result of the cancellation, expiration or forfeiture of such awards (such Shares being known as the “1996 Plan Shares”). The aggregate number of Shares available for issuance under this Plan and the number of Shares subject to outstanding Options or other Awards shall be subject to adjustment as provided in Section 10. The Shares issued pursuant to this Plan may be Shares that either were reacquired by the Company, including Shares purchased in the open market, or authorized but unissued Shares. 3.2     Additional Limits. The aggregate number of Shares subject to Options granted under this Plan during any calendar year to any one Eligible Person shall not exceed 150,000 (taking into account the number of shares associated with an Option granted and then cancelled during such calendar year). The aggregate number of Shares issued or issuable under all Awards granted under this Plan, other than Options, during any calendar year to any one Eligible Person shall not exceed 50,000 (taking into account the number of shares associated with the Awards other than Options granted and then cancelled during such calendar year). The foregoing limitations of this Section 3.2 shall not apply to the extent that they are no longer required in order for compensation in connection with grants of Awards under this Plan to be treated as “performance-based compensation” under Code Section 162(m) and, if no longer required, a change in such limitation shall not be subject to stockholder approval as required under Section 13 hereof. The aggregate number of Shares that may be issued pursuant to the exercise of ISOs granted under this Plan shall not exceed 1,500,000 (provided that such Shares shall not include the 1996 Plan Shares), which number shall be calculated and adjusted pursuant to Section 3.3 and Section 10 only to the extent that such calculation or adjustment will not affect the status of any Option intended to qualify as an ISO under Code Section 422, or whether this Plan meets the requirements under Code Section 422(b)(1). For the avoidance of all doubt, the 1996 Plan Shares may not be issued pursuant to the exercise of ISOs granted under the Plan. B-2 3.3     Issuance of Shares. For purposes of Section 3.1, the aggregate number of Shares issued under this Plan at any time shall equal only the number of Shares actually issued upon exercise or settlement of an Award and shall not include Shares subject to Awards that have been canceled, expired or forfeited or Shares subject to Awards that have been delivered (either actually or constructively by attestation) to or retained by the Company in payment or satisfaction of the purchase price or exercise price of an Award. Section 4.     Persons Eligible Under Plan      Any person who is an employee or prospective employee of the Company or any of its Subsidiaries shall be eligible to be considered for the grant of Awards hereunder; provided that the Award to such prospective employee is conditioned on the prospective employee’s commencement of employment (an “Eligible Person”). The status of the chairmanauthority of the Board of Directors as an “employee” shall be determined by the Committee. Section 5.     Plan Awards 5.1     Award Types. The Committee, on behalf of the Company, is authorized under this Plan to enter into certain types of arrangements with Eligible Persons and to confer certain benefits on them. The following arrangements or benefits are authorized under this Plan if their terms and conditions are not inconsistent with the provisions of this Plan: Options, Performance Shares and Restricted Stock. Such arrangements and benefits are sometimes referred to herein as “Awards.” The authorized types of arrangements and benefits for which Awards may be granted are defined as follows:      (a) Options: An Option is a right granted under Section 6 to purchase a number of Shares at such exercise price, at such times, and on such other terms and conditions as are specified in the agreement or terms and conditions or other document evidencing the Award (the “Option Document”). Options intended to qualify as Incentive Stock Options (“ISOs”) pursuant to Code Section 422 and Options not intended to qualify as ISOs (“Nonqualified Options”) may be granted under Section 6.      (b) Performance Shares. Performance Shares is an award made under Section 8, to receive a number of Shares, the payment of which is contingent upon achieving certain Committee established performance standards derived from the Qualifying Performance Criteria described in Section 9.2 hereof. Once the conditions for the Performance Shares are met, the Performance Shares shall be payable either in cash or Shares (or both) by reference to the fair market value of the Shares enumerated in the Performance Shares at such time as determined by the Committee in the Award.      (c) Restricted Stock: A Restricted Stock is an award or issuance of Shares under Section 7, subject to certain restrictions and the risk of forfeiture and terms as are expressed in the agreement or other document evidencing the Award. 5.2     Grants of Awards. An Award may consist of one such arrangement or benefit or two or more of them in tandem, and the terms as established by the Committee for all Awards granted hereunder may include performance standards derived from the Qualifying Performance Criteria, and the receipt of any Award may be contingent on performance standards derived from the Qualifying Performance Criteria. Section 6.     Options      The Committee may grant an Option or provide for the grant of an Option, either from time to time in the discretion of the Committee or automatically upon the occurrence of specified events, including, without limitation, the achievement of performance goals, the satisfaction of an event or condition within the control of the recipient of the Award or within the control of others. 6.1     Option Document. Each Option Document shall contain provisions regarding (a) the number of Shares that may be issued upon exercise of the Option, (b) the purchase price of the Shares and the means of payment for the Shares, (c) the term of the Option, (d) such terms and conditions on the vesting and/or exercisability of an Option as may be determined from time to time by the Committee, (e) restrictions on the transfer of the Option and forfeiture provisions and (f) such further terms and conditions, in each case not B-3 inconsistent with this Plan as may be determined from time to time by the Committee. Option Documents evidencing ISOs shall contain such terms and conditions as may be necessary to qualify, to the extent determined desirable by the Committee, with the applicable provisions of Section 422 of the Code. 6.2     Option Price. The purchase price per share of the Shares subject to each Option granted under this Plan shall equal or exceed 100% of the fair market value of a Share on the date the Option is granted. 6.3     Option Term. The “Term” of each Option granted under this Plan, including any ISOs, shall be 10 years from the date of its grant, unless the Committee provides for a lesser term. 6.4     Option Vesting. Options granted under this Plan shall be exercisable at such time and in such installments during the period prior to the expiration of the Option’s Term as determined by the Committee. The Committee shall have the right to make the timing of the ability to exercise any Option granted under this Plan subject to continued employment, the passage of time and/or such performance requirements as deemed appropriate by the Committee. 6.5     Termination of Employment other than as a Result of Death or Disability. An ISO of any Participant who shall cease to be an Employee other than as a result of his death or disability shall be exercisable only to the extent exercisable on the date of termination of employment (i.e., to the extent vested) and must be exercised on or before the option expiration date specified in the Option Agreement but is no event later than the date that is three (3) months following the date of termination of employment. To the extent any ISO is not exercisable on the date of termination of employment (i.e., to the extent not vested) such ISO shall terminate on the date of termination of employment. To the extent any ISO is not exercised within the time period provided, such ISO shall terminate as of the date of expiration of such time period. Nothing in the Plan shall be construed as imposing any obligation on the Company to continue the employment of any Participant or shall interfere or restrict in any way the rights of the Company to discharge any Employee at any time for any reason whatsoever, with or without cause. 6.6     Payment of Exercise Price. The exercise price of an Option shall be paid in the form of one of more of the following, as the Committee shall specify, either through the terms of the Option Document or at the time of exercise of an Option: (a) cash or certified or cashiers’ check, (b) shares of capital stock of the Company that have been held by the Participant for such period of time as the Committee may specify, (c) other property deemed acceptable by the Committee, (d) a reduction in the number of Shares or other property otherwise issuable pursuant to such Option, (e) payment under an arrangement with a broker selected or approved by the Company where payment is made pursuant to an irrevocable commitment by the broker to deliver to the Company proceeds from the sale of the Shares issuable upon exercise of the Option, or (f) any combination of (a) through (d). 6.7     No Option Repricing. Without the approval of stockholders, the Company shall not reprice any Options. For purposes of this Plan, the term “reprice” shall mean lowering the exercise price of previously awarded Options within the meaning of Item 402(i) under Securities and Exchange Commission Regulation S-K (including canceling previously awarded Options and regranting them with a lower exercise price). Section 7.     Restricted Stock Awards      The Committee is authorized to make Awards of Restricted Stock to Participants in such amounts and subject to such terms and conditions as may be determined by the Committee. All Awards of Restricted Stock shall be evidenced by a Restricted Stock Award Agreement. 7.1     Issuance and Restrictions. Restricted Stock shall be subject to such restrictions on transferability and other restrictions as the Committee may impose (including, without limitation, limitations on the right to vote Restricted Stock or the right to receive dividends on the Restricted Stock). These restrictions may lapse separately or in combination of such times, under such circumstances, in such installments, upon the satisfaction of continued employment, standards derived from the Qualifying Performance Criteria, lapse of time, certain acceleration events like death or disability or otherwise, as the Committee determines at the time of the grant of the Award or thereafter. B-4 7.2     Forfeiture. Except as otherwise determined by the Committee at the time of the grant of the Award or thereafter, upon termination of employment during the applicable restriction period or upon failure to satisfy a standard derived from the Qualifying Performance Criteria during the applicable restriction period, Restricted Stock that is at that time subject to restrictions shall be forfeited and re-acquired by the Company; provided, however, that the Committee may provide in any Award Agreement that restrictions or forfeiture conditions relating to Restricted Stock will be waived in whole or in part in the event of terminations resulting from specified causes, and the Committee may in other cases waive in whole or in part restrictions or forfeiture conditions relating to Restricted Stock. 7.3     Certificates for Restricted Stock. Restricted Stock granted under the Plan may be evidenced in such manner as the Committee shall determine. If certificates representing shares of Restricted Stock are registered in the name of the Participant, certificates must bear an appropriate legend referring to the terms, conditions, and restrictions applicable to such Restricted Stock. Section 8. Performance Shares      The Committee is authorized to grant Performance Shares to Participants on such terms and conditions as may be determined by the Committee. The Committee shall have the complete discretion to determine the number of Performance Shares granted to each Participant. All Awards of Performance Shares shall be evidenced by an Award Agreement. 8.1     Right to Payment. A grant of Performance Shares gives the Participant the right to a number of Shares, contingent upon certain performance standards established by the Committee and derived from the Qualifying Performance Criteria, and certain other terms and conditions as may be established by the Committee. Once the conditions and terms for the performance Shares have been met, the Performance Shares shall be payable by the Company either in cash or Shares (or both) by reference to the fair market value of the Shares enumerated in the Performance Shares and the timing of such payment of cash or Shares shall be set forth in the Award for the Performance Shares by the Committee. 8.2     Other Terms. The time period for the measurement of any performance standard or criteria shall be any time period established by the Committee, but under no circumstance shall a Performance Shares be granted after the expiration of the Plan, and the applicable performance associated with such Performance Share must begin before the expiration of this Plan. The cash or Shares paid with respect to Performance Shares may be paid in a lump sum or in installments following the close of the performance period or, in accordance with procedures established by the Committee, on a deferred basis. Section 9.     Other Provisions Applicable to Awards 9.1     Transferability. Unless the agreement or other document evidencing an Award (or an amendment thereto authorized by the Committee) expressly states that the Award is transferable as provided hereunder, no Award granted under this Plan, nor any interest in such Award, may be sold, assigned, conveyed, gifted, pledged, hypothecated or otherwise transferred in any manner prior to the vesting or lapse of any and all restrictions applicable thereto. 9.2     Qualifying Performance Criteria. For purposes of this Plan, the term “Qualifying Performance Criteria” shall mean any one or more of the following performance criteria, either individually, alternatively or in any combination, applied to either the Company as a whole, to a business unit or subsidiary, or based on comparisons of any of the performance measures relative to other companies, either individually, alternatively or in any combination, and measured either annually or cumulatively over a period of years, on an absolute basis or relative to a pre-established target, to previous years’ results or to a designated comparison group, in each case as specified by the Committee in the Award: (a) cash flow, (b) earnings per share or increases of same, (c) earnings before interest, taxes and amortization, (d) return on equity, (e) total stockholder return, (f) share price performance, (g) return on capital or investment, (h) return on assets or net assets, (i) revenue, (j) income or net income, (k) operating income or net operating income, (l) operating profit or net operating profit, (m) operating margin or profit margin, (n) return on operating revenue, (o) pre-tax or after-tax profit levels expressed in either absolute dollars, (p) revenues or revenue growth, (q) economic or B-5 cash value added, (r) results of customer satisfaction surveys, (s) other measures of performance, quality, safety, productivity or process improvement, (t) market share, (u) overhead or other expense reduction, (v) departure or on-time arrival performance, and (w) baggage handling. These factors may have a minimum performance standard, a target performance standard and a maximum performance standard. The Committee shall appropriately adjust any evaluation of performance under a Qualifying Performance Criteria to exclude any of the following events that occurs during a performance period: (i) asset write-downs, (ii) litigation or claim judgments or settlements, (iii) the effect of changes in tax law, accounting principles or other such laws or provisions affecting reported results, (iv) accruals for reorganization and restructuring programs and (v) any extraordinary non-recurring items as described in Accounting Principles Board Opinion No. 30 and/or in management’s discussion and analysis of financial condition and results of operations appearing in the Company’s annual report to stockholders for the applicable year. 9.3     Dividends. Unless otherwise provided by the Committee, no adjustment shall be made in Shares issuable under Awards on account of cash dividends that may be paid or other rights that may be issued to the holders of Shares prior to their issuance under any Award. The Committee shall specify whether dividends or dividend equivalent amounts shall be paid to any Participant with respect to the Shares subject to any Award that have not vested or been issued or that are subject to any restrictions or conditions onadministration of such plans. 5. To maintain regular contact with the record date for dividends. 9.4     Documents Evidencing Awards. Except for ISOs prior to the effective dateleadership of the Plan as set forth in Section 17,Company. This should include review of data from the Committee shall, subject to applicable law, determine the dateemployee survey. 6. To prepare and publish an Award is deemed to be granted, which for purposes of this Plan shall not be affected by the fact that an Award is contingent on subsequent stockholder approval of this Plan. The Committee or, except to the extent prohibited under applicable law, its delegate(s) may establish the terms of agreements or other documents evidencing Awards under this Plan and may, but need not, require as a condition to any such agreement’s or document’s effectiveness that such agreement or document be executed by the Participant and that such Participant agree to such further terms and conditions as specified in such agreement or document. The grant of an Award under this Plan shall not confer any rights upon the Participant holding such Award other than such terms, and subject to such conditions, as are specified in this Plan as being applicable to such type of Award (or to all Awards) or as are expressly set forth in the agreement or other document evidencing such Award. 9.5     Tandem Stock or Cash Rights. At the time an Award is granted or by subsequent action, the Committee may, but need not, provide that an Award shall contain as a term thereof, a right, either in tandem with the other rights under the Award or as an alternative thereto, of the Participant to receive, without payment to the Company, a number of Shares, cash or a combination thereof, the amount of which is determined by reference to the value of the Award. 9.6     Financing. The Committee may in its discretion provide financing to a Participant in a principal amount sufficient to pay the purchase price of any Award and/or to pay the amount of taxes required by law to be withheld with respect to any Award. Any such loan shall be subject to all applicable legal requirements and restrictions pertinent thereto, including Regulation U promulgated by the Federal Reserve Board. The grant of an Award shall in no way obligate the Company or the Committee to provide any financing whatsoever in connection therewith. 9.7     Compliance with Code Section 409A. Notwithstanding any language to the contrary in this Plan, the Committee will ensure that the terms and conditions of any Awards issued will comply with the applicable provision of Code Section 409A or the regulations or other pronouncements thereunder. 9.8     Additional Restrictions on Awards. Either at the time an Award is granted or by subsequent action, the Committee may, but need not, impose such restrictions, conditions or limitations as it determines appropriate as to the timing and manner of any resales by a Participant or other subsequent transfers by a Participant of any Shares issued under an Award, including without limitation (a) restrictions under an insider trading policy, (b) restrictions designed to delay and/or coordinate the timing and manner of sales by Participants, and (c) restrictions as to the use of a specified brokerage firm for such resales or other transfers. B-6 Section 10.     Changes in Capital Structure 10.1     Corporate Actions Unimpaired. The existence of outstanding Awards (including any Options) shall not affect in any way the right or power of the Company or its stockholders to make or authorize any or all adjustments, recapitalizations, reorganizations, exchanges, or other changesannual executive compensation report in the Company’s capital structure or its business, or any merger or consolidation of the Company, or any issuance of Shares or other securities or subscription rights thereto, or any issuance of bonds, debentures, preferred or prior preference stock ahead of or affecting the Shares or other securities of the Company or the rights thereof, or the dissolution or liquidation of the Company, or any sale or transfer of all or any part of its assets or business, or any other corporate act or proceeding, whether of a similar character or otherwise. Further, except as expressly provided herein or by the Committee, (a) the issuance by the Company of shares of stock of any class of securities convertible into shares of stock of any class, for cash, property, labor or services, upon direct sale, upon the exercise of rights or warrants to subscribe therefor, or upon conversion of shares or obligations of the Company convertible into such shares or other securities, (b) the payment of a dividend in property other than Shares, or (c) the occurrence of any similar transaction, and in any case whether or not for fair value, shall not affect, and no adjustment by reason thereof shall be made with respect to, the number of Shares subject to Options or other Awards theretofore granted or the purchase price per Share, unless the Committee shall determine in its sole discretion that an adjustment is necessary to provide equitable treatment to a Participant. 10.2     Adjustments Upon Certain Events. If the outstanding Shares or other securities of the Company, or both, for which the Award is then exercisable or as to which the Award is to be settled shall at any time be changed or exchanged by declaration of a stock dividend, stock split, combination of shares, recapitalization, or reorganization, the Committee may appropriately and equitably adjust the number and kind of Shares or other securities which are subject to the Plan or subject to any Awards theretofore granted, and the exercise or settlement prices of such Awards, so as to maintain the proportionate number of Shares or other securities without changing the aggregate exercise or settlement price, provided, however, that such adjustment shall be made so as to not affect the status of any Award intended to qualify as an ISO or as “performance based compensation” under Section 162(m) of the Code. Section 11.     Mergers and Liquidation      Except as limited by the provisions of Code Section 422 of the Code and the terms of any individual Award, if the company is the surviving corporation in any merger or consolidation, all Awards shall remain in force, and any: (1) Option granted under the Plan shall remain outstanding pursuant to the terms of the Plan and the Award; and (2) Restricted Stock granted under the Plan shall continue to be outstanding pursuant to the terms of the Award and this Plan. Except to the extent otherwise provided in an Award document, by the Board, or as limited by Code Section 422, dissolution or liquidation of the Company shall cause every unvested Option, Restricted Stock or other Award for which there remains contingencies, conditions and unmet performance standards to terminate. Except as limited by Code Section 422, a merger or consolidation in which the Company is not the surviving corporation shall also cause every unvested Option, Restricted Stock or other Award for which there remains contingencies, conditions and unmet performance standards to terminate unless specifically provided otherwise in an Award document or by the Board. Section 12.     Taxes 12.1     Withholding Requirements.proxy statement. The Committee may makewill have authority to retain such provisions or impose such conditions as it may deem appropriate for the withholding or payment by a Participant of any taxes that the Committee determines are required in connection with any Award granted under this Plan, and a Participant’s rights in any Award are subject to satisfaction of such conditions. 12.2     Payment of Withholding Taxes. Notwithstanding the terms of Section 12.1, the Committee may provide in the agreement or other document evidencing an Award or otherwise that all or any portion of the taxes required to be withheld by the Company or, if permitted by the Committee, desired to be paid by the Participant, in connection with the exercise, vesting, settlement or transfer of any other Award shall be paid or, at the election of the Participant, may be paid by the Company by withholding shares of the Company’s B-7 capital stock otherwise issuable or subject to such Award, or by the Participant delivering previously owned shares of the Company’s capital stock, in each case having a fair market value equal to the amount required or elected to be withheld or paid, or by a broker selected or approved by the Company paying such amount pursuant to an irrevocable commitment by the broker to deliver to the Company proceeds from the sale of the Shares issuable under the Award. Any such election is subject to such conditions or procedures as may be established by the Committee and may be subject to approval by the Committee. Section 13.     Amendments or Termination      The Board may amend, alter or discontinue this Plan or any agreement or other document evidencing an Award made under this Plan but, except as provided pursuant to the anti-dilution adjustment provisions of Section 10.2, no such amendment shall, without the approval of the stockholders of the Company:      (a) change the maximum number of shares of Common Stock for which Awards may be granted under this Plan;      (b) reduce the price at which Options may be granted below the price provided for in Section 6.2;      (c) reduce the exercise price of outstanding Options;      (d) extend the term of this Plan;      (e) change the class of persons eligible to be Eligible Persons or Participants; or      (f) increase the number of shares that are eligible for non-Option Awards.      The Board may amend, alter or discontinue the Plan or any agreement evidencing an Award made under the Plan, but no amendment or alteration shall be made which would impair the rights of any Award holder, without such holder’s consent, under any Award theretofore granted; provided that no such consent shall be required if the Committee determines in its sole discretion and prior to the date of any change in control, recapitalization, stock dividend, stock split, reorganization, merger, consolidation or similar type transaction that such amendment or alteration either is required or advisable in order for the Company, the Plan, or any Award granted, to satisfy any law or regulation or to meet the requirements of any accounting standard. Section 14.     Compliance with Other Laws and Regulations.      This Plan, the grant and exercise of Awards thereunder, and the obligation of the Company to sell, issue or deliver Shares under such Awards, shall be subject to all applicable federal, state and foreign laws, rules and regulations and to such approvals by any governmental or regulatory agency as may be required. The Company shall not be required to register in a Participant’s name or deliver any Shares prior to the completion of any registration or qualification of such Shares under any federal, state or foreign law or any ruling or regulation of any government body which the Committee shall determine to be necessary or advisable. This Plan is intended to constitute an unfunded arrangement for the Eligible Persons.      No Option shall be exercisable unless a registration statement with respect to the Option is effective or the Company has determined that such registration is unnecessary. Unless the Awards and Shares covered by this Plan have been registered under the Securities Act of 1933, as amended, or the Company has determined that such registration is unnecessary, each person receiving an Award and/or Shares pursuant to any Award may be required by the Company to give a representation in writing that such person is acquiring such Shares for his or her own account for investment and not with a view to, or for sale in connection with, the distribution of any part thereof. Section 15.     No Right to Company Employment      Nothing in this Plan or as a result of any Award granted pursuant to this Plan shall confer on any individual any right to continue in the employ of the Company or interfere in any way with the right of the Company to terminate an individual’s employment at any time. The agreements or other documents B-8 evidencing Awards may contain such provisions as the Committee may approve with reference to the effect of approved leaves of absence. Section 16.     Liability of Company      The Company and any Affiliate which is in existence or hereafter comes into existence shall not be liable to a Participant, an Eligible Person or other persons as to:      (a) The Non-Issuance of Shares. The non-issuance or sale of shares as to which the Company has been unable to obtain from any regulatory body having jurisdiction the authority deemed by the Company’scompensation consultants, outside counsel to be necessary to the lawful issuance and sale of any shares hereunder; and      (b) Tax Consequences. Any tax consequence expected, but not realized, by any Participant, Eligible Person or other person due to the receipt, exercise or settlement of any Option or other Award granted hereunder. Section 17.     Effectiveness and Expiration of Plan      This Plan shall be effective on the date the Company’s stockholders adopt this Plan, and no ISOs shall be granted prior to the Company’s stockholders adoption of this Plan. All Awards granted under this Plan are subject to, and may not be exercised before the approval of this Plan by the stockholders. Stockholder approval of the Plan shall be by the affirmative vote of the holders of a majority of the outstanding shares of the Company present, or represented by proxy, and entitled to vote, at a meeting of the Company’s stockholders or by written consent in accordance with the laws of the State of Delaware; provided that if such approval by the stockholders of the Company is not forthcoming, all Awards previously granted under this Plan shall be void. No Awards shall be granted pursuant to this Plan more than 10 years after the effective date of this Plan. Section 18.     Incentive Stock Options      Notwithstanding anything in the Plan to the contrary, it is the intention of the Company and the Committee that all terms and provisions relating to Incentive Stock Options of this Plan shall be consistent with the requirements of Code Section 422 and the applicable regulations thereunder, as of the effective date of this plan, and to the extent any term or provision of this Plan relating to Incentive Stock Options is inconsistent with Code Section 422 and the applicable regulations thereunder at that date, the term or provision shall be read, interpreted or substituted so as to be consistent with the applicable provision of Code Section 422 or the regulations thereunder. Section 19.     Non-Exclusivity of Plan      Neither the adoption of this Plan by the Board nor the submission of this Plan to the stockholders of the Company for approval shall be construed as creating any limitations on the power of the Board or the Committee to adopt such other incentive arrangements as either may deem desirable, including without limitation, the granting of restricted stock or stock options otherwise than under this Plan, and such arrangements may be either generally applicable or applicable only in specific cases. Section 20.     Governing Law      This Plan and any agreements or other documents hereunder shall be interpreted and construed in accordance with the laws of the State of Nevada and applicable federal law. The Committee may provide that any dispute as to any Award shall be presented and determined in such forum as the Committee may specify, including through binding arbitration. Any reference in this Plan or in the agreement or other document evidencing any Award to a provision of law or to a rule or regulation shall be deemed to include any successor law, rule or regulation of similar effect or applicability. B-9 Section 21.     Miscellaneous Matters 21.1Annulment of Awards. The grant of any Award under the Plan payable in cash is provisional until cash is paid in settlement thereof. The grant of any Award payable in Shares is provisional until the Participant becomes entitled to the certificates in settlement thereof. In the event the employment of a Participant is terminated for cause (as defined below), any Award which is provisional shall be annulled as of the date of such termination for cause. For the purpose of this Section 21.1, the term “terminated for cause” means any discharge for violation of the policies and procedures of the Company or any Subsidiary or for other job performance or conduct which is detrimental to the best interests of the Company or a Subsidiary. 21.2Securities Law Restrictions. No Shares shall be issued under the Plan unless counsel for the Company shall be satisfied that such issuance will be in compliance with applicable Federal and state securities laws. Certificates for Shares delivered under the Plan may be subject to such stock-transfer orders and other restrictionsadvisors as the Committee may deem advisable under the rules, regulations, and other requirements of the Securities and Exchange Commission, any stock exchange upon which the Shares is then listed, and any applicable Federal or state securities law. The Committee may cause a legend or legends to be put on any such certificates to refer to those restrictions. Further, without limiting the foregoing, each person exercising an Option or Performance Shares or receiving Restricted Stock may be required by the Company to give a representation in writing that he or she is acquiring Shares for his or her own account for investment and not with a view to, or for sale in connection with, the distribution of any part thereof (regardless of whether such option and Shares covered by the Plan are registered under the Securities Act of 1933, as amended). As a condition of transfer of the certificate evidencing Shares, the Committee may obtain such other agreements or undertakings, if any, that it may deem necessary or appropriate to assume compliance with any provisions of the Plan or any law or regulation. Certificates for Shares delivered under the Plan may be subject to such stock transfer orders and other restrictions as the Board may deem advisable under the rules, regulations, and other requirements of the Securities and Exchange Commission, any stock exchange upon which the Shares are then listed, and any applicable Federal or state securities laws. The Board may cause a legend or legends to be put on any such certificate to refer to those restrictions. 21.3Award Agreement. Each Participant receiving an Award under the Plan shall enter into an, Award Agreement with the Company in a form specified by the Committee agreeing to the terms and conditions of the Award and such related matters as the Committee, in its sole discretion, shall determine. 21.4Costs of Plan. The costs and expenses of administering the Plan shall be borne by the Company. 21.5Tax Reimbursement Payments to Participants.discretion. The Committee pursuantwill have sole authority to approve related fees and retention terms. The Committee will report its actions and any recommendations to the termsBoard after each Committee meeting and will conduct and present to the Board an annual performance evaluation of the agreements or other documents pursuant to which specific Awards are made underCommittee. The Committee will review at least annually the 2005 Plan, may agree to reimburse Participants for some or all of the federal, state and local income taxes associated with the grant or exercise of an Award or the receipt of the cash or Shares from an Award (including any additional tax imposed due to Code Section 409A), or the 20% excise tax on any “excess parachute payments” under Code Sections 280G and Code Section 4999, and may agree to reimburse such Participants for some or all the additional federal, state and local income tax associated with the payments made under this Section 21.5. 21.6Government Regulations. The Plan and the granting and exercise of Options and Performance Shares hereunder, and the obligations of the Company to sell and deliver Shares under such Options and Performance Shares, shall be subject to all applicable laws, rules and regulations, and to such approvals by any governmental agencies or national securities exchanges as may be required. 21.7Interpretation. If any provision of the Plan is held invalid for any reason, such holding shall not affect the remaining provisions of the Plan, but instead the Plan shall be construed and enforced as if such provisions had never been included in the Plan. Headings contained in the Plan are for convenience only and shall in no manner be construed as partadequacy of this Plan. Any referencecharter and recommend any proposed changes to the masculine, feminine or neuter gender shall be a reference to such other gender as is appropriate.Board for approval. C-1 B-10 MESA AIR GROUP, INC. THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF MESA AIR GROUP, INC. FOR THE ANNUAL MEETING OF SHAREHOLDERS      The undersigned shareholder of Mesa Air Group, Inc., a Nevada corporation (the “Company”), hereby acknowledges receipt of the Notice of Annual Meeting of Shareholders, dated January 7, 2005,March 14, 2008, and hereby appoints Jonathan G. Ornstein or Brian S. Gillman and each of them, proxies and attorneys-in-fact, with full power of substitution, on behalf and in the name of the undersigned, to represent the undersigned at the Annual Meeting of Shareholders of MESA AIR GROUP, INC. to be held at the Company’s corporate offices, at 3 Gateway, 410 N. 44th44th Street, Suite 160, Phoenix, Arizona 85008 on February 8, 2005,April 17, 2008, at 10:00 a.m., Arizona time, and at any adjournment(s) or postponement(s) thereof, and to vote all shares of Common Stock that the undersigned would be entitled to vote if then and there personally present, on the matters set forth below. 1.   ELECTION OF DIRECTORS   o   FOR all nominees listed below (except as marked to the contrary below): Jonathan G. Ornstein, Daniel J. Altobello, Robert Beleson, Ronald R. Fogleman,Carlos E. Bonilla, Joseph L. Manson, Peter F. Nostrand, Maurice A. Parker Julie Silcockand Richard R. Thayer     o   WITHHOLD AUTHORITY to vote for all nominees listed above INSTRUCTIONS: To withhold authority to vote for any individual nominee, write that nominee’s name in the space provided below: 2. PROPOSAL TO RATIFY THE COMPANY’S 2005 EMPLOYEE STOCK INCENTIVE PLAN o FOR o AGAINST o ABSTAIN 3.   RATIFICATION OF DELOITTE & TOUCHE LLP AS THE COMPANY’S INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRMACCOUNTANTS       o FOR o AGAINST o ABSTAIN THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED HEREIN BY THE UNDERSIGNED SHAREHOLDER. IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED “FOR” THE ELECTION OF THE NOMINEES NAMED ABOVE “FOR” THE PROPOSAL TO ADOPT THE COMPANY’S 2005 EMPLOYEE STOCK INCENTIVE PLAN,AND “FOR” THE PROPOSAL TO RATIFY THE SELECTION OF DELOITTE & TOUCHE LLP AS THE COMPANY’S INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM,ACCOUNTANTS, AND AS SAID PROXIES DEEM ADVISABLE ON SUCH MATTERS AS MAY COME BEFORE THE MEETING.   Dated:                                        , 2005 2008 Please sign exactly as your name appears on the front of this Proxy Card. When shares are held in common or in joint tenancy, both should sign. When signing as attorney, executor, administrator, trustee or guardian, please give full title as such. If a corporation, sign in full corporate name by President or other authorized officer. If a partnership, please sign in partnership name by an authorized person. SIGNATURES: Please return in the enclosed, postage-paid envelope. I Will                                         Will notattend the Meeting. Will notattend the Meeting.