• Elliott will launch a proxy fight at Southwest Airlines and will nominate 10 directors to the company's 15-person board.
• Elliott has an 11% stake in the airline through stock and derivatives.
• The activist needs to own 10% of the company's common stock to call a special meeting.

Elliott Management will launch a proxy fight at Southwest Airlines and intends to nominate 10 directors to the company's 15-person board, the activist said Tuesday evening, a long-expected move following weeks of back and forth between the airline and the investor.

Elliott plans to call a special meeting, rather than waiting for the company's annual shareholder meeting. Southwest's last shareholder meeting was held in May.

Southwest said in a statement Wednesday it's confident it has the right leadership in place and had made consistent efforts to reach out to Elliott since the campaign began. Elliott had agreed recently to further discussions scheduled for September, the airline said, until the activist "unilaterally" decided to announce it would launch a proxy fight.

The activist has already amassed an economic interest of roughly 11%, although only 7% is in common stock. Elliott needs to own at least 10% of the company in order to call a special meeting, under Southwest's bylaws, a threshold that it will likely cross soon.

Elliott's ten nominees are:

• Michael Cawley, former Ryanair deputy CEO
• David Cush, former Virgin America CEO
• Sarah Feinberg, a former federal transportation regulator
• Josh Gotbaum, a former Lazard banker and White House appointee
• Dave Grissen, former Marriott International group president
• Nancy Killefer, former McKinsey senior partner and Treasury Department administrator
• Robert Milton, former CEO of Air Canada and former United Airlines chair
• Gregg Saretsky, former WestJet CEO
• Eash Sundaram, former JetBlue executive vice president
• Patty Watson, NCR Atleos chief technology officer

"The strong qualifications of these Candidates stand in contrast to those of the current Board, which prior to Elliott's June 10 letter lacked a single independent director with airline experience," Elliott said in a statement.

Elliott disclosed its Southwest investment in June, writing to the company's board to say that it believed that CEO Bob Jordan and chairman Gary Kelly were responsible for a precipitous decline in the company's fortunes and that Southwest should move to replace them.

Southwest rebuffed those requests, and CEO Jordan since told CNBC that Elliott's engagement with the company had not been meaningful. The activist had already intimated that it would seek to call for a special meeting in its second letter to Southwest's board.

The 10-person slate does not include any Elliott employees. The activist has already indicated it has no desire to exert absolute control over the company, but rather is seeking a comprehensive business review in addition to leadership.

The news comes the same day that another Elliott-targeted company, Starbucks, announced it would appoint Chipotle CEO Brian Niccol as the coffee chain's new chief. There were signs that Elliott's push at Southwest would also ramp up. Saretsky, one of activist's ten nominees, resigned this week from the board of Sabre Corp., an airline bookings software company, citing his involvement with a "third party" which was invested in a Sabre client, according to a securities filing. His resignation was effective Monday, before news of Elliott's slate became public, according to the filing.

Southwest last month announced the biggest changes to its business model in its more than 50 years of flying, with the end of its open seating model and premium seating that will come with extra legroom.

Southwest had been studying such changes for years, but an oversupplied U.S. market has driven down fares, forcing the carrier and its rivals to adopt new business models to drum up revenue. Budget carrier Spirit Airlines, for example, recently said it would start selling a sort of business class with its bigger seats at the front of the cabin that will come with complimentary Wi-Fi, snacks, drinks and checked luggage.

The airline's executives will discuss its strategy in more detail during an investor day next month.