## Before the United States Department ofTransportat1on August 15, 2012

Proposal to Provide Essential Air Service at CLOVIS, NEW MEXICO SILVER CITY/HURLEY/DEMING, NEW MEXICO
Under49 U.S.C. 41731 et seq.


# SeaPortAirlines, Inc. Docket OST-1996-1902 Docket OST-1996-1903



# Proposal to Provide Essential Air Service (EAS) at Clovis and Silver/Hurley/Deming, New Mexico

By Order 2012-7-20, the Department requested proposals for Essential Air Service (EAS) at Clovis and Silver City/Hurley/Deming, New Mexico (hereafter shortened to "Silver City'). SeaPort Airlines, Inc. respectfully submits this timely proposal to provide subsidized EAS to the aforementioned communities. SeaPort Airlines is proposing a single service pattern proposal at both Clovis and Silver City, but with a choice of two aircraft types. The proposals herein are inseparable and require that both communities choose the same aircraft type. Shortly after this proposal is docketed, SeaPort Airlines will contact the Airport Manager in each community to schedule a presentation to explain our proposal in detail and answer any questions. In the interim and throughout the carrier selection process, questions regarding this proposal should be directed to:
Timothy Sieber Vice President

- Commercial SeaPortAirlines, Inc. 7505 NE AirportWay Portland, OR 97218 (971) 340-1716 tsieber@seaportair.com

# Description of Proposed Service

Introduction to SeaPortAirlines 

### SeaPort Airlines, Inc. is a FAA certified scheduled airline with 30 years ofexperience in commercial aviation. The company is headquartered in Portland, Oregon and has operational bases at Portland, Memphis (Tennessee), and Juneau (Aiaska). 1 

### Our approximately 180 professionals operate a fleet of 14 aircraft on an average of 90 daily departures to 20 cities in eight states. Presently, service to seven ofthese communities is provided under the EAS program: Excursion Inlet, Alaska; Pendleton, Oregon; ElDorado, Hot Springs, and Harrison, Arkansas; Salina, Kansas; and Jackson, Tennessee. The focus ofSeaPort's business model is providing affordable and reliable service to small and rural communities that the global airline brands either characterize as no longer being strategically important to their own business model, or because the passenger ticket revenue generated by that community is not sufficient to support the cost structure and increasingly larger aircraft of regional airlines that provide capacity to those global brands on a contract (i.e., "fee per departure") basis. To serve these communities, SeaPort operates aircraft with operating costs and passenger capacity that are aligned with a market's true demand, offers higher frequencies and departure time choices than possible with largeraircraft, sets all fares at a price point that is attractive to potential customers but does not result in shifting the true cost of air travel from the customer to the Department, and provides attentive and personal service that, in many of our markets, is commonly referred to as 'The SeaPort Experience." When awarded an EAS contract, SeaPort Airlines begins service on time, on budget, and with fares at or below those in our service proposal. Once service is launched, we develop a partnership with each community by participating in local events, donation of tickets, regular dialogue with airport management and community leaders, and presentations to civic clubs and other similar organizations. These activities serve our own interests as equally as those of the community by fostering grass roots support for local air service, a positive relationship between the community and EAS carrier, and, as ridership builds, can lead to enplanement levels that ensure continued eligibility in the EAS program. The strongest evidence of our commitment to provide quality air service and build community partnerships is demonstrated by the fact that in every one of our "Lower 48" EAS communities SeaPort Airlines has been re-selected as the EAS provider at the end of the first contract period. This includes the reselection of SeaPortAirlines earlier this year for a four-year contract (rather than the standard two-year contract) to in Salina, Kansas based on overwhelmingly positive support from the community, and the reselection of SeaPort Airlines at Pendleton, Oregon over a competing bid that offered 37-passenger aircraftand was marketed with the brand ofa majorairline. Further evidence of our commitment to providing reliable, customer-focused air service, however, is demonstrated through community and customer comments that are provided later in this proposal. Finally, we encourage community leaders in both Clovis and Silver City to contact the airport manager in any of our EAS communities to discuss the responsive, affordable, and reliable air service thatwe provide.

1Operations in SoutheastAlaska are branded as "Wings ofAlaska."

Docket OST-1996-1902 & Docket OST-1996-1903 August 15, 2012 Page 12

# SEA+PORT

Aircraft 

### SeaPort Airlines presently provides service in all of our EAS communities with single engine aircraft and, as noted above, every one ofour EAS communities in the Lower 48 has reselected us for additional contract periods with those same aircraft. We strongly believe that modern singleengine aircraft represent the best platform to provide EAS service that is frequent, affordable, and reliable. We are nonetheless, offering two aircraft types for consideration by the communities of Clovis and Silver City, both ofwhich are described below. Cessna Caravan Currently being produced in the USA, the "Caravan" was originally designed in the 1980's to replace an aging fleet of piston-powered aircraft, such as the De Havilland Otter and Piper Chieftain. Over 2,000 Caravans have been built logging a total of over 12.5 million flight hours. The Caravan is certified for single-pilot operation, however, SeaPort typically operates with both a Captain and First Officer.



# N20811C



# , , :-1

# -w SEAJPORT .,**==~ :::;** **==- ,','-·/~** 

The large cargo pod on the Caravan allows for more baggage than can be accommodated on older piston twins (i.e., Piper Navajo and Cessna 402) and allows us to segregate passenger baggage for security purposes.2


### As noted earlier, however, SeaPort operates single-engine aircraft and enjoys strong community support in all of the EAS markets that we serve. This is because on a daily basis we demonstrate that the Cessna Caravan is the ideal platform for safe and reliable air transportation with higher frequencies than would be economically possible with larger aircraft. While our experience in these other markets makes us confident of our ability to build support in

2 The cargo pod on the Cessna Caravan has a maximum capacity of 111 cubic feet and 1,090 pounds. In comparison, the Piper Chieftain has a maximum capacity of65 cubic feet and 700 pounds in its nose compartment and two wing lockers.

Docket OST-1996-1902 & Docket OST-1996-1903 August 15, 2012 Page 13

# SEA-tPORT

Clovis and Silver City, we offer the following additional points for consideration as both communities evaluate this proposal:

• The argument that single-engine aircraft are less safe than multi-engines is based on the presumption ofengine failure. Failure of modern turbine engines is extremely rare, and even rarerthat engine failure is the primary cause ofan accident or incident

• Multi-engine aircraft experience asymmetric thrust and a loss of climb performance of up to 80%. In contrast, single-engine aircraft don't experience asymmetric thrust, and they typically have higher glide ratios and can land at slower speeds.

• As reliability has improved over the last 75 years, airlines have specified fewer engines on new aircraft designs

- "more is better"no longerapplies.



### • Newer, modern technology single-engine turboprops aircraft provide a better customer experience than 35 year old piston-powered twin engine aircraft. Piper Chieftain
49 U.S.C. 41732(b)(5) entitles communities to EAS service with twin-engine aircraft and two pilots, however communities can waive their right to twin-engine aircraft. SeaPort Airlines presently provides service in all of our EAS communities with single engine aircraft and, as noted above, every one of our EAS communities in the Lower 48 has selected SeaPort Airlines for subsequent contract periods. Notwithstanding our beliefthat the Cessna Caravan represents the best platform for frequent, economical and reliable air service, we are including in this proposal the option ofservice with twin-engine Piper Chieftains.
The Chieftain is a stretched version of the Piper Navajo that operates with a pilot and co-pilot, and seats 8 passengers (one less than the Cessna Caravan). The aircraft has two Lycoming piston engines and baggage storage in a nose compartment and wing lockers.3 

### The aircraft offers adequate range with afull load of passengers to operate the service pattern offered in this proposal, and has atypical cruise speed of 175 knots. Over 1,800 Chieftains were built between 1972 and 1984 by Piper Aircraft. Analysis of aircraft presently offered for sale indicates that ifthe option of service with Chieftains is selected, we will not have difficulty finding suitable aircraft to begin service at Clovis and Silver City in a timely manner. Service Pattern & Proposed Schedule 

### If selected to provide EAS at Clovis and Silver City, the company intends to establish an additional operational base at Albuquerque International Sunport (ABQ) with three aircraft

- two assigned to scheduled lines and the third being an operational spare. This will allow us to offer both Clovis and Silver City morning originating flights, and the operational flexibility to rotate aircraft into ABQ for scheduled maintenance and/or facilitate quicker service recovery in the event of unscheduled maintenance events.

3 See footnote 2.

Docket OST-1996-1902 & Docket OST-1996-1903 August 15, 2012 Page 

### 14

# SEA, tPORT

== :- ,.. ,..**.**



### For each community, SeaPort Airlines is proposing service to Albuquerque International Sunport

. This is the hub that historically has provided Clovis and Silver City with connectivity to the national air transportation system

. Equally as important, Albuquerque traditionally functions as the central point for cultural, banking, government, and advanced medical care for the entire state of New Mexico

. As of August 2012, ABO offers consumers an average of 10,455 seats on an average of 94 departures to 27 nonstop destinations on seven airlines4 

# Connecting Service Available at Albuquerque International Sunport (ABO): August 2012

Minneapolis



### Proposed Schedules ,·**~'-:....-~**



### Consistent with the Department's request in Order 2012-7-20, SeaPort Airlines is proposing 18 roundtrips each week between ABO and both Clovis and Silver City

. This greater choice of frequency, combined with SeaPort's pricing model and marketing strategies outlined below, is projected to increase enplanement levels at both communities above those being generated by the EAS providerwith 12 weekly roundtrips

. Illustrative schedules are provided below. The illustrated flight times reflect those of the Cessna Caravan. Ifthe communities were to select service to be with Piper Chieftains, flight times would be marginally shorter.

4 Excludes current EAS provider at Clovis and Silver City who presumably will exit ABQ as service is initiated by the new carrier.

Docket OST-1996-1902 & Docket OST-1996-1903 August 15, 2012 Page 15

# SEAtPDRT

SeaPortAirlines, Inc. Illustrative Schedule Pattern 18 Weekly Roundtrips: Silver City- Albuquerque, NM Aircraft T : Cessna Caravan

ExSun ExSat 0 0 FromAlbuquerque to Silwf City 8:45am 10:00am ExSun 0 2:45pm 4:00pm ExSat 0 6:1 ExSat 0 

### 18 Weekly Roundtrips:Clovis- Albuquerque, NM

6:00am 1215pm 4:1 

### Aircraft · Cessna Caravan

ExSat ExSat 0
Regardless ofaircraft type, ifSeaPort is selected to provide service to Clovis and Silver City,we will seek input from each community before establishing final schedules. Pricing Model
In all markets, SeaPort Airlines offers a range of fares all priced on a one-way basis. The highest price point (branded as "FuiiFiex") provides a customer with total flexibility to change travel plans without incurring any change fee or, if desired, receive a total refund

. The lowest price point (branded as "NoFiex") is best suited for customers who are certain about their travel plans and requires an advance purchase of21-days, is non-refundable, and does not permit any changes from the original booked itinerary

. In between is a range of fares ("Fiex4Free" and "Fiex4Fee") that provides a choice of price-points based largely on how certain a customer is that their travel plans will not change. Except for the two highest price points, fares are also subject to capacity controls meaning that the farther in advance a reservation is made, the more likely a customer is to get a lowerfare.
This strategy, which is not materially different from other airlines, allows SeaPort to set price points in a manner that makes our service attractive to virtually all segments ofthe market who might utilize air service at Clovis and Silver City.
The table on the next page summarizes the range of ticket prices in each market, as ofthe date of this proposal and after expiration of introductory fares, along with the rules and restrictions applicable to each price point.

Docket OST-1996-1902 & Docket OST-1996-1903 August 15, 2012 Page 16

### Summary of Fare Rules 

## SeaPortAirlines Illustrative Fares Clovis & Silver City, NM
FuiiFiex Free2Fiex Flex4Fee Advance Purchase

- 

### # Days 0 3 3 7 Refundable Yes No 

### No No Change Fee $0 $0 $50 $50 Fare Code YR B3F M3L H7L FlyerFiex Loyalty Program Credit 200% 150% 100% 100% Clovis, New Mexico to/from Albuquerque $149 $129 $89 $79 Sitver City/Hurley/Deming, New Mexico to/from Albuquerque $159 $139 $99 $89 

# SEA.+PORT

NoFlex 14 21 No No 

### $50 No 

### Chg

. Q14L L21X 

### 100% 0% $69 $49 $79 $49 NOTE Listed price points include Federal Excise Tax, segments fee. and 9/11 security fee 

### SeaPort Airlines projects an average ticket price of $91.94 and $102.37 at Clovis and Silver City, respectively. Net of taxes and fees, revenue to SeaPort and the basis for calculation of subsidy requirements, is projected to be $79.85 per customer traveling to/from Clovis and $89.55 per customertraveling to/from Silver City. During the first 30 days ofservice, SeaPort Airlines would offer an introductory fare of$49 (including all taxes and fees) on every seat, on every flight at both Clovis and Silver City intended to entice customers to the new service and provide an opportunity to have "The SeaPort Experience." Interline Connectivity& GDS Display Tickets may be purchased by calling our toll-free reservation number, online at www.SeaPortAirlines.com, at any travel agent connected to the major global distribution systems (GDS), or all of the major online travel agencies and meta-searchers such as Orbitz, Travelocity, Expedia, Kayak, Hipmunk, and CheapoAir. SeaPort has an interline ticketing agreement with US Airways and is currently implementing another agreement, including full E-ticketing and thru baggage, with another major airline that is scheduled to be available on September 20, 2012. Upon completion of this implementation, agreements with other carriers will be sought and dialogues are currently underwaywith three other large airlines. Marketing & Public Relations Strategy SeaPort is prepared to implement a comprehensive marketing and public relations strategy if selected to provide EAS at Clovis and Silver City which, in addition to traditional advertising, will include:

• Local Event Marketing: Recognizing that visible participation in local events has been successful for both legacy and low-cost airlines, SeaPort has implemented a similar strategy in all of its communities. These have ranged from SeaPortAirlines community Easter egg hunts, to presenting at business expos, to hosting "after hours" events at local Chamber of Commerce meetings. In addition, SeaPort often makes "in kind" donations of tickets for use by local charities, eitherfor their own business needs or as a fundraising tool (i.e., raffles, silent auctions, etc.).

Docket OST-1996-1902 & Docket OST-1996-1903 August 15, 2012 Page 17

# SEAi~PORT

• Social Media: SeaPort Airlines effectively leverages social media to engage our customers in a dynamic two-way conversation using Internet sites such as Facebook, Twitter, FourSquare & Linkedln. We have found social media to be an excellent tool for generating passenger referrals and information sharing in our communities, and expect similar results in both Clovis and Silver City.

• FlyerFiex Customer Rewards: During 2011, SeaPort launched a new and improved customer loyalty program called "FiyerF/ex." This program provides customers with a variety of benefits including free flights, service charge waivers, and bonus points. With roll-out of our new website this month, SeaPort will shortly unveil further enhancements to the FlyerF/ex program including a wider range oftravel award options and the ability for customers to check balances and redeem awards online.

• Value Accounts: SeaPort offers Corporate Value Accounts that encourage businesses to make a long-term investment in local air service by offering a variety of benefits, such as waivers to change fees and savings of 5% to 15%. It is important to note that unlike the corporate travel programs of major airlines that are not designed to serve small businesses in rural communities, SeaPort's program can provide savings to a company of virtually any size and can be used by any employee ofa company. In service proposals herein, SeaPort Airlines has allocated $20,000 per year for sales and marketing in both Clovis and Silver City (combined total of$40,000). This budget factors media costs in smaller media markets and that traffic typically originates in the EAS community rather than the hub market. This advertising budget will be effectively leveraged with "new media" such as social networking, blogs, opt-in email, etc., all intended to engage customers and build relationships on a more personal level.

Docket OST-1996-1902 & Docket OST-1996-1903 August 15, 2012 Page

### 18

# SEA.tPORT

Community 

# &Customer Feedback

Provided below is a small sample ofthe comments that SeaPort Airlines regularly receives from our customers and from EAS community partners. These comments are indicative of the type of partnership and customer experience (Le, "The SeaPort Experience) that can be expected from SeaPortAirlines ifselected to provide EAS at Clovis and SilverCity, New Mexico.

Our Essential Air Service Community Partners "South Arkansas Regional Airport and the entire South-central Arkansas region suffered from the loss ofairservicepreviouslyprovidedbyMesa Airlines in the Spring of2008. Unreliable service and 

### a poorschedule were alreadynegativelyimpacting enplanements before Mesa pulledout, butatthat point, the nearest option forairservice ofanykind was almost

### a two hourdrive away Aftersorting through applications from many different interested carriers, the El Dorado Airport Commission, along with ElDorado's Mayor, chose SeaPortto restore airservice to South Arkansas. This was the beginning ofa greatpartnership between SeaPortandourlocalcommunity "Working with SeaPort has been nothing but 

### a pleasure from the bottom to the top of their organization, and theircommitment to excellence shines through the glowing comments that I hear from people who fly with them. In addition to hearing comments from others, I have flown SeaPort on several occasions, andhave come awayfrom the experience thinking 'This is howallairservice shouldbe." Josh Zylks Airport Manager South Arkansas RegionalAirport (Goodwin Field)

"Eastern Oregon Regional Airport at Pendleton had been struggling since schedule changes following 9111 served by 

### a carrier flying 37 seat aircraft. Low passenger count attributed to poor schedule, which then contributed to poorerpassengercount. The carrier's solution was to bring in larger aircraft and fly to 

### a different hub. The Airport and community balked at this suggestion and went in search ofalternatives. The solution found through the EASprocess was SeaPortAirflying a 9 passengerPilatus. The passengers have welcomed the new service, much betterschedule, and are elated with 'no securitycheck'andstandbytime. Passengers today will say, '/love the service', 'greatcustomerservice,'and 'I'm sure gladI finally triedit, cause I'llbe back'
"In ourparticularmarket, the 9passengeraircraft

### is perfect, and SeaPortAirprovides the schedule, the professionalism, andcustomerservice we needanddesire."

Docket OST-1996-1902 & Docket OST-1996-1903 August 15, 2012 Larry Dalrymple Airport Manager Pendleton RegionalAirport

Page 

### 19

# SEA-~+PORT

"I understand the importance ofhaving dependable, reliable airservice with an affordable cost. Not only will SeaPortAirlines meet these needs, but excel byproviding great customerservice, a high levelofcommunityinvolvement, andan eagerness to become a communitypartner".

OurCustomers Luci Larson Former Mayor

### &Owner of Action Travel Salina, KS

''Two hours before the flight I booked my ticket to Memphis from Hot Springs. Wow! What a surprise; 

### it was simple, convenient, great price, and impeccable service. It far exceeded my expectations andI willbe flying to Memphis on SeaPortAirlines instead ofdriving from nowon. The customerservice was fabulous!"
Ruth Ann Smith (Hot Springs to Memphis)

"MyhusbandandI recentlyhadto make a fast trip to Dallas forthe funeral ofa dearfriend I was not interested in making that drive overa fast weekend Then I remembered that SeaPort had recently started flights between Hot Springs and Dallas. I called SeaPort, Jim and Bob were so quick to get us booked, lastminute so we could fly down andattend the funeral and visit with family and friends that we don'tgetto see veryoften. Everyone was so friendly, helpfulandprofessional. It was a dream trip, even to attenda funeral. The pilotgoing down was so kind When he found out thatmyhusbandhadbeen a ball turretgunnerin WW/1, he gave him a set ofheadphones so he couldlisten to the communication between the pilots and the airtraffic controllers. To saythe least, myhusband was impressed It was such a blessing to have been taken care ofin such a kindandprofessionalmanner, especiallyunderthe circumstances ofourtrip. Thankyou, Jim, Bob, Chris, Doug, RodneyandMichael." Catherine Martin (Hot Springs to Dallas)

"Fortwo decades I have been picking mymotherup at the airportand for two decades I have been met with the defeated, hang-dog look that the ordeal ofair travel has given her. I guess it pretty much does it to all ofus, but (as she is well into her80's) I worryabout the toll it takes on hermore andmore lately
"When Ipickedherup today from herSeaPort flight K52325 from Dallas andsaw she was smiling, you could have knocked me over with a feather! She couldn't stop raving about howpleasant the flight was. Letme be clear My motheris a tough-as-nails Mid-western Yankee from the oldschool who has been around the world a couple oftimes since the late 1940's. She doesn't bestow idle praise andshe seldom raves.

Docket OST-1996-1902 & Docket OST-1996-1903 August 15, 2012 Page 110"I'm in the service industry myselfand I know howoften complaints come through. Ijust want to be sure to letyou know how well everyone did on this flight. In the future, I will look to SeaPort first for mytravel needs andwill spreadthe good wordto myfriends.
"A smile and

### a kind wordgo

### a long wayy'all. Thankyou forgetting this one so right."
Mark Davis Peterson (Dallas to Memphis)

"I cannot say enough wonderful things about my experience with yourcompany. My son, who is 7, flew for the first time as an unaccompanied minor. Let's just say that my son and I were very nervous. On arrival to Kansas City I was welcomed with front row parking and an employee that was welcoming and reassuring. When hisplane landed the pilot, Demetrius came and talked to me and myson for twentyminutes aboutsafetyandjust reassuring me. He then allowedme to walkmyson to the plane andsee him off Demetrius startedbuckling myson into his seat andmyson started to cry, I could see him reassuring him that everything was going to be ok. All ofyouremployees were wonderful and were conscious ofsafety and the well-fare ofmy son. My son's flights from Kansas City to Memphis were wonderful and because of the extra attention he feels comfortable and unafraidofflying byhimself You have made me 

### a lifelong customer. My son will be flying at least once 

### a year to see his Grandparent. I have toldall my friends, family andco-workers aboutyourcompanyandhowifthey have an opportunitytheyshouldfly with SeaPort. Thank You again formaking

### a nervous motherand 

### a scaredchildfeel comfortable." Misty Strayhorn (Kansas Cityto Memphis)

"I have neverhad such 

### a positive experience connected with any airline. I read about SeaPortAir last October when theyopened the Mid-South Route, but didn't have the chance to fly until March. Usually the dread ofthe process comes then youjust grin and bearit; however, with SeaPortAirI couldarrive 15minutes early. The hassle free no TSA is wonderfulandmade me feelspecial. Ihave flown twice in the last2 months and the customerservice from start to finish is outstanding. I will be 

### a regular customer and have already recommended the airline to several associates. Thank you, SeaPortAir, formaking me fee/like 

### a queen!"

Docket OST-1996-1902 & Docket OST-1996-1903 August 15, 2012 Catherine Martin (Memphis to Harrison)

Page 111

# SEA)tPORT

Subsidy Request 

# &Supporting Calculations

The following pages contain the service proposals of SeaPortAirlines to provide essential air service at Clovis and Silver City/Hurley/Deming, New Mexico. The proposals are presented as an inseparable package and require that both communities select the same aircraft type, either the Cessna Caravan or Piper Chieftain.
The level ofrequired subsidy, by airplane type, is summarized on the table below. 

# Summary of Subsidy Requirement

Clovis 

# &Silver

# c· ,New Mexico

Each proposal is presented on the basis ofannual subsidy requirement for each year in a two year term. Notwithstanding the risk of inflation in coming years (particularly related to fuel costs) that could possibly outstrip traffic growth and our ability to respond with reasonable fare increases, 

### SeaPort is offering the Deparbnentand the communitythe option to contractthe second year subsidy level for a four-year period (i.e., annual rate of $4,256,629 or $4,393,702 for each of the four years, depending on service option selected). We believe this provides the Athens community with the assurance of stable air service for an extended period and reduces the administrative burden on both the Department and ourselves. Respectfully submitted,

Timothy Sieber Vice President

- Commercial SeaPortAirlines, Inc.
August15,2012

Docket OST-1996-1902 & Docket OST-1996-1903 August 15, 2012 Page 112

# SEA.-tPORT

SeaPortAirlines, Inc. 18 Weekly Roundtrips: Clovis- Albuquerque, NM Aircraft Option: Cessna Caravan

Operating Projections Average Sector Length (sm) Scheduled Departures Scheduled Block Hours Projected Completion Factor Projected Completed Departures Projected Completed Block Hours Passenger Projections Projected Passengers Passengers per Departure Projected Average Fare Revenue Passenger Miles (RPMs) Available Seat Miles (ASMs) Projected Load Factor Financial Projections Revenues Passenger Ticket Revenues Ancillary Revenues Total Expenses Flight Operations Aircraft ONnership/Lease Fuel & Oil Sales & Marketing Traffic Servicing Insurance Maintenance Sub-Total- Direct Indirect Total Expenses Projected Operating Profiti(Loss) Subsidy Calculations Operating Loss Economic Return @ 5% 

# I Required Subsidy Subsidy per Departure Subsidy per Passenger Avg. Enplanements per Operational Day

Docket OST-1996-1902 & Docket OST-1996-1903 August 15, 2012 Year 1
205 1,872 2,652.0

99.0%

1,853 2,625.5

5,822 3.1 $89.55 1,193,510 3,419,302 34.9%

$521,360

$10,427 $531,787
$225,420 $446,250 $716,040

$20,000 $274,723

$47,736 $600,831 $2,331,000

$233,100 $2,564,100 ($2,032,313)

$2,032,313

$128,205 $2,160,518

$1,165.78

$371.10 9.3 Year 2
205 1,872 2,652.0

99.0%

1,853 2,625.5

5,938 3.2 $91.34 1,217,380 3,419,302 35.6%

$542,423

$10,848 $553,272
$236,691 $468,563 $751,842

$21,000 $288,459

$50,123 $630,873 $2,447,550

$244,755 $2,692,305 ($2, 133.929)

$2,133,929

$134,615 $2,268,5441

$1,224.07

$382.01 9.5

Page 113

## SeaPortAirlines, Inc. 18 Weekly Roundtrips: Silver City- Albuquerque, NM Aircraft Option: Cessna Caravan

Operating Projections Average Sector Length (sm) Scheduled Departures Scheduled Block Hours Projected Completion Factor Projected Completed Departures Projected Completed Block Hours Passenger Projections Projected Passengers Passengers per Departure Projected Average Fare Revenue Passenger Miles (RPMs) Available Seat Miles (ASMs) Projected Load Factor Financial Projections Revenues Passenger Ticket Revenues Ancillary Revenues Total Expenses Flight Operations AircraftONnership/Lease Fuel & Oil Sales & Marketing Traffic Servicing Insurance Maintenance Sub-Total- Direct Indirect Total Expenses Projected Operating Profit!(Loss) Subsidy Calculations Operating Loss Economic Return @ 5% 

# I Required Subsidy Subsidy per Departure Subsidy per Passenger Avg. Enplanements per Operational Day

Docket OST-1996-1902 & Docket OST-1996-1903 August 15, 2012 Year 1

188 1,872 2,340.0

99.0%

1,853 2,316.6

5,322

2.9 $79.85 1,000,536 3,135,750 31.9%

$424,962 $8,499 $433,461
$196,911 $393,750 $625,482

$20,000 $236,323

$41,699 $500,445 $2,014,610

$201,461 $2,216,071 ($1,782,610)

$1,782,610

$110,804 $1,893,414

$1,021.66

$355.77 8.5 Year 2

188 1,872 2,340.0

99.0%

1,853 2,316.6

5,428

2.9 $81.45 1,020,547 3,135,750 32.5%

$442,130 $8,843 $450,973
$206,757 $413,438 $656,756

$21,000 $248,140

$43,784 $525,467 $2,115,341

$211,534 $2,326,875 ($1,871.741)

$1,871,741

$116,344 $1,988,085l

$1,072.74

$366.23 8.7

Page 114**===~** 

# "'**'''!'~** 

## SeaPortAirlines, Inc. 18 Weekly Roundtrips: Clovis- Albuquerque, NM Aircraft Option: Piper Chieftain
Operating Projections Average Sector Length (sm) Scheduled Departures Scheduled Block Hours Projected Completion Factor Projected Completed Departures Projected Completed Block Hours Passenger Projections Projected Passengers Passengers per Departure Projected Average Fare Revenue Passenger Miles (RPMs) Available Seat Miles (ASMs) Projected Load Factor Financial Projections Revenues Passenger Ticket Revenues Ancillary Revenues Total Expenses Flight Operations Aircraft ONnership/Lease Fuel 

### &Oil Sales & Marketing Traffic Servicing Insurance Maintenance Sub-Total

- Direct Indirect Total Expenses Projected Operating Profiti(Loss) Subsidy Calculations Operating Loss Economic Return 

### @ 5% 

# I Required Subsidy Subsidy per Departure Subsidy per Passenger Avg, Enplanements per Operational Day

Docket OST-1996-1902 & Docket OST-1996-1903 August 15, 2012 Year 1

205 1,872 2,464,8

9T5%

1,825 2,403,2

5,822 3,2 $89,55 1,193,510 2,993,328 39,9%

$521,360

$10,427 $531,787
$209,508 $143,154 $716,517

$20,000 $259,747

$96,127 $748,695 $2,193,749

$438,750 $2,632,499 ($2,100,711)

$2,100,711

$131,625 $2,232,336

$1,223,06

$383A3 9,3 Year 2

205 1872 2465 

### 9T5%

1,825 2,403,2

5,938 3.3 $91,34 1,217,380 2,993,328 40,7%

$542,423

$10,848 $553,272
$219,983 $150,312 $752,343

$21,000 $272,735 $100,934 $786,129 $2,303,436

$460,687 $2,764,124 ($2,210,852)

$2,210,852

$138,206 $2,349,0581

$1,28T01

$395.57 9.5

Page 115

# SEAtPORT

SeaPortAirlines, Inc. 18 Weekly Roundtrips: Silver City- Albuquerque, NM Aircraft Option: Piper Chieftain
Operating Projections Average Sector Length (sm) Scheduled Departures Scheduled Block Hours Projected Completion Factor Projected Completed Departures Projected Completed Block Hours Passenger Projections Projected Passengers Passengers per Departure Projected Average Fare Revenue Passenger Miles (RPMs) Available Seat Miles (ASMs) Projected Load Factor Financial Projections Revenues Passenger Ticket Revenues Ancillary Revenues Total Expenses Flight Operations Aircraft Ownership/Lease Fuel & 01 Sales & Marketing Traffic Servicing Insurance Maintenance Sub-Total- Direct Indirect Total Expenses Projected Operating Profit/(Loss) Subsidy Calculations Operating Loss Economic Return 

### @ 5% 

# I Required Subsidy Subsidy per Departure Subsidy per Passenger Avg. Enplanements per Operational Day

Docket OST-1996-1902 & Docket OST-1996-1903 August 15, 2012 Year 1

188 1,872 2,184.0

97.5%

1,825 2,129.4

5,322 2.9 $79.85 1,000,536 2,745,101 36.4%

$424,962 $8,499 $433,461
$180,999 $126,846 $619,017

$20,000 $221,347

$83,047 $635,076 $1,886,331

$377,266 $2,263,597 ($1 ,830,137)

$1,830,137

$113,180 

### $1,943,316

$1,064.71

$365.15 8.5 Year 2

188 1872 2184 97.5%

1,825 2,129.4

5,428 3.0 $81.45 1,020,547 2,745,101 37.2%

$442,130 $8,843 $450,973
$190,049 $133,188 $649,967

$21,000 $232,415

$87,199 $666,830 $1,980,648

$396,130 $2,376,777 ($1,925,805)

$1,925,805

$118,839 

### $2,044,6431

$1,120.23

$376.65 8.7

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