August 29, 2005

Mr. Mark Woods
18253rd PI. SW #B
Federal Way, WA 98023

Dear Mr. Woods:

We received your recent letter concerning the bylaw amendment you sponsored at the 2005 Alaska Air Group annual shareholder meeting to adopt a simple-majority voting standard for amending the Bylaws.

As was stated in the 2005 proxy statement, the Board opposes the proposal and believes that it is invalid for the reasons outlined on page 41 of the proxy statement under "Disabling the Board from effectively exercising its statutory and fiduciary duties."

The Board takes seriously its obligation to consider shareholder proposals that receive passing votes. For example, in 2004 we adopted policies on shareholder rights plans ("poison pills") and confidential voting in response to proposals that were approved by shareholders.  At the same time, however, the Board takes just as seriously its fiduciary obligation to use independent judgment on how to maximize the Company's value to all stakeholders, including investors, employees and customers.

As a result of these considerations, the Board has decided not to implement your proposal.  We regret that this may not be the outcome you had hoped for, but it is the outcome that the Board of Directors believes its fiduciary duty requires.


Keith Loveless
Vice President/Legal and Corporate Affairs
General Counsel and Corporate Secretary


cc: Alaska Air Group Board of Directors
Shannon Alberts