New fleet structure for short-haul operations; resizing and reconstitution of the Board of Directors

25 August 2005

The SWISS Board of Directors resolved to streamline the company’s aircraft fleet structure when it met yesterday: the SWISS short-haul fleet will consist solely of Avro RJ and Airbus A320 family equipment from the start of the 2006 summer schedules. In a further development, the present eight-member Board of Directors is to be reduced to five members at an Extraordinary General Meeting to be held on September 22, 2005.

In addition to the existing Airbus A320 family contingent, the SWISS short-haul aircraft fleet is to consist of 24 Avro RJ85 and RJ100 regional jets from the start of the 2006 summer schedules. The Board of Directors has resolved that the company’s Embraer 145s should be gradually withdrawn by the end of the coming winter schedules, while the Saab 2000 fleet will no longer be operated from the start of the winter timetable period. The Board simultaneously approved the expansion of the present Avro RJ fleet to 24 aircraft.

Gradual implementation of the fleet plan for regional operations

The new fleet plan should be gradually implemented. SWISS currently operates a fleet of 35 regional aircraft, consisting of seven Saab 2000s, nine Embraer 145s, four Avro RJ85s and 15 Avro RJ100s.

One Avro RJ100 will be handed over to its new owner as planned in October. The nine Embraer 145s will be leased out to other operators: corresponding negotiations are already well advanced. SWISS will lease-in six further Avro RJ100s in the course of the first quarter of 2006, and put these aircraft into operation.

Resizing and reconstitution of the Board of Directors

As announced in May, the SWISS Board of Directors is to be resized from eight to five members as part of the company’s acquisition by Lufthansa and its integration into the Lufthansa Group. With the reduction in numbers, the entire Board of Directors will be newly elected. The Extraordinary General Meeting required for such actions is to be held on September 22, 2005.

Current Board members Pieter Bouw, Claudio Generali, Michael Pieper, Jan Audun Reinas and Peter Siegenthaler have submitted their resignations from the Board of Directors with effect from September 22. Present Board members Jacques Aigrain, Walter Bosch and Rolf Jetzer will be standing for election for a further term of office. Standing for election as new Board members and representatives of Lufthansa will be Wolfgang Mayrhuber and Klaus G. Schlede.

The five members of the new SWISS Board of Directors will be elected for an ordinary term of office of three years. Following the Extraordinary General Meeting, the five elected members of the new Board of Directors will appoint a Chairman from within their ranks. Rolf Jetzer is envisaged for this post.

“With three of our present Board members on the new Board and with Rolf Jetzer as its new Chairman, we are ensuring an element of continuity in our Board of Directors,” says present Chairman of the Board Pieter Bouw. “I am also delighted that Lufthansa intends to delegate Wolfgang Mayrhuber and Klaus Schlede – two eminent and extremely competent individuals – to serve on the SWISS Board.”

The proposed new Board members:

Jacques Aigrain, 51, has been a Member of the SWISS Board of Directors and Chairman of its Audit Committee since December 2001. A graduate in economics and law, he has been a Member of the Executive Board of Swiss Re since June 2001, heading the company’s Financial Services Business Group, and has been Deputy CEO of Swiss Re since January 2005.

Walter Bosch, 61, has been a Member of the SWISS Board of Directors since May 2003 and Deputy Chairman and Lead Director since March 2004. He studied economics in St. Gallen and Berlin. Walter Bosch has been active as a business entrepreneur and communications consultant since 1997. He is Delegate to the Board of Directors of Euphonix Inc., Palo Alto, serves on the Boards of Directors of Cablecom, Star TV, the Good News event agency and skiing company Zai AG, and is a Member of the Industry Council of the London-based GMT Partners private equity fund.

Rolf P. Jetzer, 55, has been a Member of the SWISS Board of Directors and Chairman of its Remuneration Committee since May 2004. A doctor in law, he has been a partner at the Zurich-based Niederer Kraft & Frey law firm since 1988, specialising in commercial law. He was elected to the Boards of Directors of Bank Julius Bär & Co. AG and of Julius Bär Holding AG in April 2005.

Wolfgang Mayrhuber, 58, has been Chairman of the Executive Board and CEO of Deutsche Lufthansa AG since June 2003. An Austrian by birth, he is also Chairman of the Supervisory Board of Lufthansa CityLine GmbH and a Member of the Supervisory Boards of Eurowings Luftverkehrs AG, Münchener Rückversicherungs-Gesellschaft AG and BMW AG.

Klaus G. Schlede, 68, is a Member of the Supervisory Board of Deutsche Lufthansa AG, and served as its Chairman from 1998 to 2003. A graduate in business administration, he served as Chief Financial Officer and Deputy Chairman of the Executive Board of Deutsche Lufthansa AG from 1991 to 1998. Schlede, who lives in Switzerland, is also a Member of the Supervisory Boards of Deutsche Telekom AG and Deutsche Postbank AG.