easyGroup Sets easyJet Deadline To Improve Performance Or Lose Brand

28th Jul 2010 14:41

LONDON (Dow Jones)--easyJet PLC (EZJ.LN) major shareholder, Stelios Haji-Ioannou through easyGroup, said Wednesday in a letter to the easyJet board of directors that should the company fail to remedy the breach of certain clauses by Oct. 26, easyGroup IP Licensing Limited will have the right to issue notice of termination of the Brand License. MAIN FACTS: -He said, that for the purposes of this cure notice the Licensor would accept that the following levels are reasonable requirements for compliance with the Brand License (provided that easyJet's statistics in these categories are also not and do not become materially worse than those of its competitors): -a. less than 1% of easyJet flights that are cancelled. -b. at least 70% of easyJet flights depart on-time (measured as within 15 minutes of the advertised time); and -c. the average minutes delay of easyJet flights does not exceed 15 minutes. -He said the company is in material breach of clauses 3.4, 3.6 and 6.1.8 of the Brand License dated Nov. 5, 2000. -The company's current punctuality and flight cancellation rates are unacceptable and contrary to the brand values upon which easyJet and the other easyGroup companies have built their reputation, adding, the airline is currently being run in a way which is materially detrimental to and inconsistent with the good name, goodwill, reputation and image of easyGroup IP Licensing and its intellectual property rights. -He said, by this cure notice EGIP requires easyJet to remedy its breaches of each of the clauses 3.4, 3.6 and 6.1.8 of the Brand License within 90 days. -He said deviations from these measures will be acceptable where it is a result of circumstances beyond easyJet's control which it cannot be reasonably expected to have anticipated and addressed. -easyJet shares at 1340 GMT down 29.1 pence, or 6.7%, at 405.4 pence. By Iain Packham, Dow Jones Newswires; 44-20-7842-9269; [email protected] (END) Dow Jones Newswires July 28, 2010 09:41 ET (13:41 GMT)