BEFORE THE 

DEPARTMENT OF TRANSPORTATION 

WASHINGTON, D.C. 

 ) 

Application of ) 

 ) 

AVIATION SERVICES, LTD. ) DOCKET DOT-OST-2010- 

(d/b/a FREEDOM AIR (Guam)) ) 

 ) 

for a Certificate of Public Convenience ) 

and Necessity (Foreign Passenger ) 

Charter Service) ) 

 ) 

APPLICATION OF AVIATION SERVICES, LTD. (d/b/a 

FREEDOM AIR (Guam)) FOR A CERTIFICATE OF PUBLIC CONVENIENCE AND 

NECESSITY 

Communications with respect to this document should be sent to: 

Gregory P. Cirillo 

Wiley Rein LLP 

7925 Jones Branch Drive 

McLean, Virginia 22102 

Ph: 703-905-2800 

Fx: 703-905-6701 

E: GCirillo@wileyrein.com 

APPLICANT REQUESTS THAT THIS APPLICATION BE PROCESSED THROUGH 

EXPEDITED, NON-HEARING PROCEDURES PURSUANT TO SUBPART B OF 

THE DEPARTMENT’S PROCEDURAL REGULATIONS. 

NOTICE: Any person may support or oppose this application by filing an answer no later 

than __________, 2010 and serving a copy of the answer on counsel for Applicant and 

upon persons served with this application. 

June 14, 2010 
1 

BEFORE THE 

DEPARTMENT OF TRANSPORTATION 

WASHINGTON, D.C. 

 ) 

Application of ) 

 ) 

AVIATION SERVICES, LTD. ) DOCKET DOT-OST-2010- 

(d/b/a FREEDOM AIR (Guam)) ) 

 ) 

for a Certificate of Public Convenience ) 

and Necessity (Foreign Passenger ) 

Charter Service) ) 

 ) 

APPLICATION OF AVIATION SERVICES, LTD. (d/b/a 

FREEDOM AIR (Guam) FOR A CERTIFICATE OF PUBLIC CONVENIENCE AND 

NECESSITY 

 Pursuant to 49 U.S.C. § 41102, Parts 201 and 204 of the Department’s Economic 

Regulations, subpart B of the Department’s Procedural Regulations, and the 

Department’s Streamlining Initiative in Docket OST-2005-22228, Aviation Services, Ltd. 

(d/b/a Freedom Air (Guam)) (hereinafter “Freedom Air”) respectfully applies for a 

certificate of public convenience and necessity authorizing Freedom Air to engage in 

foreign charter air transportation of persons, property, and mail. A parallel application 

for interstate (domestic) charter air transportation will be filed contemporaneously 

herewith, or shortly thereafter. As Freedom Air wishes to begin expanded operations 

subject to the amended certificate in October 2010, or as soon thereafter as possible, it 

requests that the Department process this application expeditiously using written 

submissions and simplified, non-hearing procedures as contemplated by sections 302.15 

and 302.207 of the Department’s Procedural Regulations. 
2 

 By this application, Freedom Air is looking to take an important step in its growth 

as an air carrier serving Guam and the Northern Mariana Islands by offering longer-range 

charter service on modern 150+ seat jet aircraft. This will enhance the mobility of people 

in the region, and propagate a local air transportation resource to the benefit of the region 

and the U.S. air transportation infrastructure. As noted below, the increased authority 

sought by Freedom Air is within its management and operational capabilities, and 

entirely supportable from a financial standpoint. 

 In support of its application, Freedom Air provides the information as required by 

14 C.F.R. §§ 201.4 and 204.3 in the Exhibits attached to this application, in addition to 

the following introductory information. 

INTRODUCTION 

1. Freedom Air is an air carrier based in Guam, USA. It has been in continuous 

operation for 35 years. It holds an active Federal Aviation Regulations (“FAR”) Part 121 

certificate for flag and supplemental operations from the Federal Aviation Administration 

(“FAA”). Freedom Air’s Part 121 Certificate is attached hereto as Exhibit S-1. In 

addition, Freedom Air has DOT commuter air carrier authority pursuant to 14 C.F.R. 

§298.50. Freedom Air seeks foreign charter authority from the DOT (and 

contemporaneously seeks interstate charter authority) to expand its short-range operations 

to include longer range foreign charters using modern, large commercial aircraft (Boeing 

737-300 or equivalent) (hereinafter referred to as “Proposed Charters”). 

2. Freedom Air currently has 120 employees, and operates a fleet of twelve aircraft 

described on Exhibit N-1 attached hereto. Operations consist of approximately fifty daily 

departures, carrying approximately 72,500 passengers per year. 
3 

3. Freedom Air is owned by four individuals (including the estate of one) all of 

whom are U.S. Citizens. Exhibit F/G attached hereto includes a listing of the 

equityholders of Freedom Air as of the date hereof. There are no outstanding securities, 

debt obligations, options, warrants or similar instruments that carry voting rights or are 

convertible into or exchangeable for instruments carrying voting rights. Freedom Air has 

no debt obligations other than trade credit incurred and paid in the ordinary course of 

business. 

4. By pursuing the Proposed Charters in association with WAI Asia, Ltd. (“WAI”) 

(as described in the Exhibits and paragraph “(t)” of the supporting information), Freedom 

Air has the financial strength to initiate and maintain the Proposed Charters without 

posing an undue risk to consumers or their funds. 

5. Senior Freedom Air management already has extensive experience in air carrier 

management and operation, and the necessary business expertise and technical ability to 

offer and manage the Proposed Charters while complying effectively with relevant 

transportation laws. Freedom Air is already a successful, Part 121 operation and the 

proposed expansion is a natural extension of it operating capabilities and footprint. 

6. Grant of the requested certificate authority is in the public interest, as it will allow 

Freedom Air to offer charterers new price and service options for passenger 

transportation. This is particularly valuable in the Pacific region where options are 

limited, and particularly in Guam, the largest island in Micronesia and the southernmost 

island in the Mariana Islands. Adding a commercial jet operation in Guam will be a 

stepping stone to potential service throughout the Pacific, connecting Guam with the 

growing Asian economies. As noted below, in connection with the arrangement with 
4 

WAI, Freedom Air will be obtaining enhanced air carrier authority utilizing the capital 

resources of WAI and that expanded authority will open up additional opportunities 

beyond the Proposed Charters, and will be a continuing asset beyond the term of the 

relationship between Freedom Air and WAI. 

7. The expanded operations will be funded and supported by WAI as more fully 

described in paragraph “(t)” below and related Exhibits T-1 and T-2. WAI is not a U.S. 

citizen as that term is defined in the Federal Aviation Act as interpreted by the DOT. The 

relationship between Freedom Air and WAI and the role of WAI in the transaction does 

not affect the citizenship of Freedom Air. Freedom Air is 100% owned by U.S. citizens, 

and its entire management team and board of directors is comprised of U.S. citizens. The 

proposed relationship with WAI would not change any of the foregoing – Freedom Air 

will remain 100% owned, controlled and managed by U.S. citizens. WAI will be 

designated and will act as Freedom Air’s General Sales Agent in several foreign 

countries. In addition to traditional promotional and sales activities, WAI will be 

providing the financial support necessary to add the large commercial aircraft to Freedom 

Air’s operating certificate, including all staffing and training costs, and as credit support 

party to the underlying aircraft leases. Freedom Air will remain in sole and exclusive 

control of all aviation operations, including (i) operational control of all flights including 

flight planning and flight following, (ii) retention, training, scheduling, supervision and 

termination of all cabin crew, ground crew and other flight-oriented personnel, (iii) all 

maintenance and repair of aircraft, and (iv) all regulatory compliance relating to aircraft 

operations (FAA, TSA and foreign equivalents). 
5 

 The ownership and management of Freedom Air will remain unaffected and 

exclusively U.S. controlled; and the participation and role of WAI as General Sales 

Agent, and in providing financial support falls well below any threshold implicating 

actual control. In the relatively recent ASTAR Air Cargo decision1

 the DOT found that 

substantial financial influence was not sufficient to constitute actual control. In that case, 

the financial support was far more pervasive, with the air carrier having a single, nonU.S. customer dictating virtually all operations, in addition to having multiple 

management ties. Moreover, virtually all of ASTAR’s operations from its inception were 

those procured through its relationship with the non-U.S. entity. In contrast, Freedom Air 

has decades of operating history unrelated to its WAI relationship and will continue to 

have pre-existing scheduled operations without regard to the charter operations supported 

by WAI. And like ASTAR, Freedom Air will have the ability to expand operations of the 

new, commercial jet fleet and is by no means limited to operations designated or 

approved by WAI. The parallel application for economic authority to engage in domestic 

charter service will include uses of the larger aircraft in charter operations outside of the 

current arrangement with WAI. 

8. Freedom Air requests that it be allowed to retain its commuter air carrier authority 

notwithstanding the grant of charter authority. As noted, Freedom Air has a longstanding and substantial business operating scheduled flights using smaller aircraft under 

the DOT’s commuter air carrier exemption, and it intends to continue those operations. 

The charter authority being requested here does not explicitly or implicitly permit the 

 

1 Recommended Decision of Administrative Law Judge, Dec. 19, 2003, No. OST-2002- 

13089-594, 2 available at [http://dmses.dot.gov/docimages/pdf88/262152_web.pdf].
6 

commuter services, and thus while it may be viewed as a “higher” level of DOT 

authority, it is actually insufficient for operations. Freedom Air asks that the commuter 

air carrier authority be preserved, or other exemption be granted to the same effect. 

8. Further supporting information is provided in Exhibits D-V to this application. 

8 

INFORMATION SUPPLIED PURSUANT 

TO THE DEPARTMENT’S REGULATIONS 

 Aviation Services, Ltd. (d/b/a Freedom Air (Guam)) (“Freedom Air”) hereby 

supplies, in support of its certificate application, the information required by the 

Department pursuant to 14 C.F.R. § 204.3. Subparagraphs and Exhibits correlate to each 

subsection in 14 C.F.R. § 204.3. 

(a) Name, address, and telephone number of applicant. 

 Aviation Services, Ltd. (d/b/a Freedom Air (Guam)) 

 Box 1578 

 Hagatna, Guam 96932 

 1-671-647-8359 

(b) Freedom Air is a corporation. 

(c) Freedom Air is organized under the laws of Guam U.S.A. 

(d) Attached as Exhibit D is a Certificate of Good Standing issued by Guam U.S.A. 

(e) Citizenship affidavit. The affidavit of James Gazley, Vice President of 

Maintenance, declaring Freedom Air to be a U.S. citizen under 49 U.S.C. § 40102(a)(15), 

as required by 49 U.S.C. § 41102, is attached as Exhibit E. 

(f) Information relating to key personnel and shareholders. 

 See Exhibit F/G. 

(g) Relevant affiliated corporations; persons having a substantial interest in the 

applicant. 

 Freedom Air is owned by four individuals (including the estate of one), all of 

whom are U.S. citizens. See Exhibit F/G. 

(h) Subsidiaries. 

 Freedom Airs owns a minority share in Aviation Services (CNMI), Ltd., which 

serves as a local operator for the Saipan, Rota and Tinian. See Exhibit H for corporate 

information. 
9 

(i) Shares held by Freedom Air in other aeronautical businesses. 

 None. 

(j - k) Corporate documents. 

 

 (1) Balance Sheet. 

 See Exhibit K-1. 

 (2 - 3) Income Statements including footnotes, preparer/auditor letter and 

accounting methods. 

 See Exhibit K-2. As described in (5) below, the financial statements were 

prepared by Filipinas E. Torres, and not an outside preparer or auditor. 

 (4) Significant events since most recent balance sheet. 

 None. 

 (5) Identity of person/entity preparing financial information, including 

his/her/its qualifications. 

 The financial information for Freedom Air is prepared by Filipinas E. Torres, a 

minority equityholder (1/1000 shares) and director of Freedom Air. His contact 

information is included in Exhibit F/G. His resume is attached hereto as Exhibit K-5

(l) List of actions and judgment exceeding $5,000 against Freedom Air or any key 

personnel. 

 There have been no judgments against Freedom Air. The following are the only 

relevant actions, which both resulted in settlement: 

• October 2007 Settlement - $225,000; passenger stumbled while stepping off the 

aircraft air stair. 

• 2001 - $30,000 settlement; bodily injury resulting for a failed main gear while 

taxiing. 

(m) Number of actions and judgments for less than $5,000. 

 None. 

(n) Fleet. 

 (1) Current fleet. 
10 

 

 See Exhibit N-1. 

 (2) Plans for aircraft acquisition. 

 Freedom Air and WAI are in the process of negotiating a letter of intent, 

to be followed by a definitive lease and sublease relating to two (2) Boeing 737-300 

aircraft. The lessor is Airtrust Capital Corporation (or a special purpose entity affiliated 

therewith). The letter of intent will be on arm’s length terms and will involve the lease of 

the aircraft to WAI, with a sublease to Freedom Air. 

 (3) Affidavit as to aircraft compliance with FAA standards. 

 See Exhibit N-3. 

(o) Description of any and all pending DOT or FAA investigations or actions 

applicable to Freedom Air or key personnel: 

 None. 

(p) Description of charges of unfair or deceptive or anticompetitive business 

practices, fraud, felony or antitrust violations, including disposition. 

 None. 

(q) Description of aircraft accidents or incidents (49 CFR 830.2) including date, type 

of flight, passengers and crew on board, injuries or fatalities, and aircraft damage 

(including any in the past 12 months, or any remaining under investigation). 

 None. 

(r) Narrative history. 

 For over 35 years Freedom Air has proudly served Guam and the Commonwealth 

of Northern Marianas Islands, offering scheduled and demand passenger services, as well 

as cargo operations. As a local, family-owned company, Freedom Air passengers enjoy 

an authentic experience of warmth and hospitality. The origins of Freedom Air began in 

1974 when Joaquin Flores, together with his mother, brother and sister, commenced 

business operating three aircraft, a Cessna 172, 150 and Piper Apache. That company has 

evolved into Freedom Air, the Mariana Islands oldest Guam based airline. In 1976 our 

nation’s bicentennial, Aviation Services, Ltd. chose the business name of Freedom Air 

which at that time engaged in flight instruction, sightseeing, and a commuter air carrier 

between Saipan and Tinian. From 1978 through 1991, Freedom Air added more small 

aircraft and operations. Beginning in 1992, larger (30 seat) turboprops were added to the 

Freedom Air fleet. In 1997, Freedom Air was certified under Part 121 of the FARs. 
11 

 Freedom Air also plays a role in Guam’s local community and donates to 

numerous charitable organizations. See Exhibit R for brief statement to this effect. 

 The expanded authority requested in this application is the next major step in the 

growth of Freedom Air and an exciting expansion of travel opportunities in and to Guam. 

(s) State and federal authority for operations. 

 (1) Federal authority. Freedom Air holds an active Part 121 certificate for 

flag and supplemental operations from the FAA, Certificate Number AVSA040A 

Certificate Issue Date 11/27/1974 (Attached as Exhibit S-1). 

 (2) Freedom Air holds the following state/territorial aviation authorities: 

 None. 

 (3) In conjunction with this Application, and to conduct the operations 

associated herewith, Freedom Air has initiated the process of upgrading its Part 121 

certificate and operating specifications to permit the operation of narrow-body, 

commercial jet aircraft. That application for upgraded authority is pending before the 

FAA Honolulu Flight Standards District Office. Freedom Air will pursue amendments to 

its security plan with the Transportation Security Administration as well. Freedom Air 

has a long-standing and favorable relationship with the Honolulu FSDO as an existing 

Part 121 carrier. 

(t) Service to be operated. 

 As an extension of its current operations, Freedom Air proposes to set up, 

promote, sell and operate charter flights between Guam and Hong Kong, Manila, 

Shanghai, Taipei and Palau using narrow-body commercial jet aircraft (the “Proposed 

Charters”). The expanded economic authority sought by this application is the authority 

required to operate the Proposed Charters. The origins and destinations will be 

determined based on market conditions and performance. As detailed below, all aircraft 

operations relating to the Proposed Charters will be undertaken exclusively by Freedom 

Air as the operating lessee of the aircraft described below. The contractual relationship 

between Freedom Air and WAI is reflected in the two Memoranda of Understanding 

attached as Exhibits T-1 and T-2. 

 The marketing and sales activity relating to the Proposed Charters, and the 

financial burden of aircraft acquisition, conformity, maintenance, repair and operation, 

and associated staff retention, training and compensation will be predominantly 

underwritten by WAI Asia, Ltd., a limited liability company formed under the laws of 

Hong Kong, Special Administrative Region of the People’s Republic of China either 

directly and/or through an entity controlled by or under common control with WAI Asia, 

Ltd. (hereinafter referred to collectively as “WAI”). WAI is a well established service 

provider in the business of acting as a general sales agent (“GSA”) for air carriers, and is 
12 

engaged in promotion and consulting in the aviation field. WAI is not a “citizen of the 

United States” as defined in 49 U.S.C. 40102(a)(15). 

 The project contemplates the lease by Freedom Air of two Boeing 737-300 

aircraft, or equivalent commercial aircraft, to perform the Proposed Charters. These 

aircraft will be acquired specifically for this purpose and will be the only Freedom Air 

aircraft engaged in the Proposed Charters (as Freedom Air’s current fleet does not suit 

operations of that type). The aircraft will be available for other operations at Freedom 

Air’s discretion to the extent they are not committed to Proposed Charters. WAI will 

provide the financial credit needed to secure these leases, either as a guarantor of 

Freedom Air’s obligations, or as a prime lessee with a sublease of the aircraft to Freedom 

Air. Freedom Air will receive from WAI a base compensation on a calendar basis with 

additional compensation as a percentage of gross revenues from the Proposed Charters to 

the extent that percentage exceeds the base compensation. As noted above, substantially 

all of the jet operation will be funded by WAI. 

 Freedom Air shall be solely and exclusively responsible for the conduct of all 

aircraft operations and decisions including sole and exclusive responsibility for: 

 a. Aircraft selection, configuration, conformity, maintenance and repair; 

 b. Ground handling, airport relationships and third party contracts; 

 c. Flight and cabin crew hiring, training and supervision; 

 d. Hiring, training and supervision of supporting personnel; 

 e. Flight planning and flight following; and 

 f. Operational licensing, permits and regulatory compliance, and 

procurement of customary insurances and third party services in all locations where 

Proposed Charters take place. 

 WAI shall be responsible for marketing and sales relating to the Proposed 

Charters. As a general sales agent, WAI will be marketing air transportation services of 

Freedom Air. WAI’s responsibilities in this regard will include: 

 a. Licensing and legal compliance to the extent necessary for the sale of air 

transportation to consumers or intermediaries in the markets where the Proposed Charters 

will operate; 

 b. Determining the manner in which seats will be marketed including 

selecting and paying for all forms of advertisement and promotion in the relevant 

markets; 

 c. Pricing of transportation and ancillary services; and 

 d. Establishing at its sole expense systems and staffing to interface with 

passengers and with intermediary charter organizers. 

 In summation, the new operation will allow Freedom Air to graduate from shortrange turboprop operations to longer-range, narrow-body jet operations. If successful, 

this expansion will allow Freedom Air to leverage its regulatory authority and expanded 
13 

operational authority to offer regional service that it does not offer today. Moreover, this 

opportunity has attracted and will bring capital into the aviation industry; specifically the 

capital of WAI which will finance the expansion and offer a valuable transportation 

service. 

 Note that the financial information referenced below and in the Exhibits reflects 

capital costs that will be incurred to prepare Freedom Air to engage in the Proposed 

Charters. The financial relationship between Freedom Air and WAI provides that 

Freedom Air’s participation in the arrangement will be limited to receipt of a flat monthly 

fee from WAI of $12,000 or one percent (1%) of gross revenues from the Proposed 

Charters, whichever is greater. All setup and operating costs are borne by WAI. (See

Exhibit T-2). Accordingly, a pro-forma income statement solely for Freedom Air would 

simply show the addition of the monthly income and projected interest in the gross 

revenues. The expanded financial information contained in Exhibit T-3 is provided to 

demonstrate the scope of the undertaking and the economics of the Proposed Charters, as 

a whole. 

(u) Montreal Agreement (relating to liability); family assistance and passenger 

manifest plans. 

 See Exhibit U. 

(v) Certification. 

 See Exhibit V. 

15 

EXHIBIT INDEX 

EXHIBIT D Certificate of Good Standing 

EXHIBIT E Citizenship Affidavit 

EXHIBIT F/G Owner, Officer and Key Personnel Information 

EXHIBIT K-1 Balance Sheets 

EXHIBIT K-2 Income Statements 

EXHIBIT K-5 Resume of Filipinas E. Torres (Accountant) 

EXHIBIT N-1 Operation Specifications for Current Aircraft Fleet 

EXHIBIT N-3 Affidavit of Safety Compliance 

EXHIBIT R Community Service Press Release 

EXHIBIT S-1 FAA Part 121 Air Carrier Authority 

EXHIBIT T-1 Memorandum of Understanding, January 14, 2010 

EXHIBIT T-2 Memorandum of Understanding, February 17, 2010 

EXHIBIT T-3 Financial Information 

EXHIBIT U Executed OST Form 4523 

EXHIBIT V Executed 18 U.S.C. § 1001 Certification 

13133443.5 
FA EXHIBIT D 

FA EXHIBIT E 

FA EXHIBIT F/G 
OWNERS 

Name Ownership 

Interest (of 

1000 

outstanding 

shares) 

Address Citizenship Involvement in 

Other 

Aeronautics 

Businesses 

Joaquin L. 

Flores, Jr.*†

868/1000 261B J.C. Fejeran St. 

Barrigada, Guam 96921 

US None 

Francisco C. San 

Nicolas* 

1/1000 261B J.C. Fejeran St. 

Barrigada, Guam 96921 

US None 

Filipinas E. 

Torres* 

1/1000 147 Chalan Islan Saipan 

Pacific Latte Estates 

Yigo, Guam 96929 

US None 

The Estate of 

Norbert J. Flores†

130/1000 261B J.C. Fejeran St. 

Barrigada, Guam 96921 

US None 

* Denotes a director. Aviation Services, Ltd. has 3 total directors.

† Joaquin L. Flores, Jr. and Norbert J. Flores were brothers. No other familial relationships exist 

among the owners. 

OFFICERS/KEY PERSONNEL 

Name Title Contact Information Citizenship Involvement in 

Other 

Aeronautics 

Businesses 

Joaquin Flores 

Jr. 

President and 

CEO 

freedom@ite.net (671) 

898-0273 

US None 

Filipinas E. 

Torres 

Treasurer (671) 472-8009 US None 

Francisco C. 

San Nicolas 

Secretary (671) 647-8359 US None 

James Gazley VP of 

Maintenance 

P121/135 

jgazley@freedomairguam.

com (671) 688-6513 

US None 

James Jamison VP of Flight 

Operations 

jjamison@freedomairgua

m.com (671) 688-6513 

US None 

Alfred Dilks Chief Pilot 

P135 

(671) 647-8359 US None 

Richard C. 

Brown 

Director of 

Safety 

(671) 647-8359 US None 

Cardiff 

Walker 

Chief Pilot 

P121 

(671) 647-8359 US None 

Charles Unten Chief 

Inspector 

(671) 647-8359 US None 
Experience: 

All of the above identified officers, directors and key personnel, have been working for 

Aviation Services, Ltd. in these same positions under its current Part 121 Air Carrier 

Authority (attached as Exhibit S-1). Owners Flores, San Nicolas and Torres have been 

with the company since its inception in 1974. Resumes for other key employees and pilot 

qualifications are on the following pages. 








FA EXHIBIT H 

FA EXHIBIT K-1 



FA EXHIBIT K-2 



FA EXHIBIT K-5 

FA EXHIBIT N-1 


FA EXHIBIT N-3 

FA EXHIBIT R 

FA EXHIBIT S-1 

FA EXHIBIT T-1 



FA EXHIBIT T-2 





FA EXHIBIT T-3 
PROYECTO GUAM

Qty./Personn

el

Period/Tim

e D/ M/ HR Ea. Total NOTE

Initial training 3 2,500.00 $ 7,500.00 $ As quoted by SWA

Travel 3 1,600.00 $ 4,800.00 $ 

Hotel 3 16 $ 2,880.00 60.00 $ 

Per diem 3 16 $ 2,400.00 50.00 $ 

New mechanic recruitment 1 1,000.00 $ 1,000.00 $ Subject Matter Expert (SME)(airfare to Guam)

Salary 1 10 3,500.00 $ 35,000.00 $ From day 1 thru first flight (start up)

Hotel in Guam 1 1 700.00 $ 700.00 $ FA provides housing for one month

Audit training facilityTravel 1 1,600.00 $ 1,600.00 $ 

Hotel 1 6 $ 360.00 60.00 $ 

Per diem 1 6 $ 300.00 50.00 $ 

Station MX trainingTravel 1 1,600.00 $ 1,600.00 $ 

Hotel 1 6 $ 750.00 125.00 $ 

Per diem 1 6 $ 300.00 50.00 $ 

Total Maintenance $ 59,190.00

Qty./Personn

el

Period/Tim

e D/ M/ HR Ea. Total NOTE

Personnel - Pilot

Initial training Simulator A/C tng 16 7,880.00 $ 126,080.00 $ Aircraft Training - Pan Am flight academy Miami

Travel 16 1,600.00 $ 25,600.00 $ 

Hotel 16 30 $ 28,800.00 60.00 $ 

Per diem 16 30 $ 28,800.00 60.00 $ 

Note: Higher Power $7380/pilot $13,000/crew

Emergency Ground/Drill 16 375.00 $ 6,000.00 $ Pan Am

Basic Indoctrination 16 Done in Guam.

Hazmat, Security, etc. Done in Guam.New Pilot Recruitment - SME 1 1,000.00 $ 1,000.00 $ Air Fare

Start up Costs (Estimate)

OPERATIONS

MAINTENANCE
PROYECTO GUAM

Salary - SME 1 10 3,500.00 $ 35,000.00 $ From day 1 thru first flight (start up)

Hotel in Guam 1 1 700.00 $ 700.00 $ 

Salary - Pilot 16 3 3,500.00 $ 168,000.00 $ Salary will adjust when operations begin

Hotel in Guam 16 1 700.00 $ 11,200.00 $ FA provides housing for one month

Total Personnel-Pilot $ 431,180.00Personnel - Flight Attendant

Initial training - Outsource 25 4,500.00 $ 112,500.00 $ Emergency Training - Pan Am Flight Academy

Travel 25 1,600.00 $ 40,000.00 $ 

Hotel 25 3 $ 4,500.00 60.00 $ 

Aircraft Ground/Drill 25 1 $ 2,500.00 100.00 $ Part of Basic Indoc (8 hrs) possible additional fee

Basic Indoctrination 25 1,200.00 $ 30,000.00 $ Pan Am Rate to be decide if FA can do it

Hazmat, Security, etc. 25 1 $ 2,500.00 100.00 $ Done in Guam.

New Flight Attendant recruitment - SME 1 1,000.00 $ 1,000.00 $ Air Fare

Salary - SME 1 10 2,500.00 $ 25,000.00 $ From day 1 thru first flight (start up)

Hotel in Guam 1 1 700.00 $ 700.00 $ 

Salary - Flight Attendant 25 2 2,000.00 $ 100,000.00 $ Salary will adjust when operations begin

Hotel in Guam 25 1 700.00 $ 17,500.00 $ FA provides housing for one month for off-island hire

Per Diem 25 1 50.00 $ 38,750.00 $ 

Total Personnel-Flight Attendant 374,950.00 $ 

Personnel - OtherNew Dispatcher recruitment - SME Possible Pilot and Dispatch SME =1Salary - Dispatcher 3 1 2,000.00 $ 6,000.00 $ Applicable only fo Flag Operations

Hotel in Guam 3 1 700.00 $ 2,100.00 $ Local hire may be possible

Salary - Flight Follower 3 14 $ 2,032.26 1,500.00 $ Director of Training 1 6 2,500.00 $ 15,000.00 $ 

Personnel - Other $ 25,132.26

Total Operations $ 831,262.26Aircraft Costs

$ 315,000.00

$ 40,000.00$ 10,000.00

Misc. $ 20,000.00

$ 385,000.00

Two aircraft $ 770,000.00

Qty./Personn

el

Period/Tim

e D/ M/ HR Ea. Total NOTE

The total cost to have an aircraft positioned and in configuration and condition to perform under the transaction, excluding regulatory expenses and personnel training and certification (per aircraft).

OTHER

Aircraft lease and depositsFerry to GuamAircraft acceptance inspection

Total aircraft
PROYECTO GUAM

Personnel

Technical Publications $ 75,000.00 Conservation to outside personnel

Salary 3 4 2,500.00 $ 30,000.00 $ Existing FA employees for 4 months

Maintenance Control 1 4 2,500.00 $ 10,000.00 $ 

Counter 3 1 1,500.00 $ 4,500.00 $ 

Reservations 2 7 $ 21,000.00 1,500.00 $ Need Decision See note below

Station Training 1 week each station based on Samoa ?????Manual Revision 8 $ 5,600.00 700.00 $ $100/ hr SME $75/hr manuals 60 hours

Management Fee 1 9 12,000.00 $ 108,000.00 $ 

Additional ComputersOutsource Consultant 1 $20/ hour UNK

Total Other Personnel $ 254,100.00

Ferry/proving Flight 2 man crew $ 250,000.00 50 hours required, ferry flight counts

LOI CheckAirman Training 7 $ 3,300.00 3,300.00 $ Proving flight useage to be decided Pan AM quote/day

Check Airman training 14 $ 3,750.00 3,750.00 $ Travel to Guam not included Pan AM quoteDitching and Evacuation Demo 20,000.00 $ 20,000.00 $ Performed until satisfactory

Table Top Exercise 1,000.00 $ 1,000.00 $ Pure guess

TSA Security for eticketing 1,000.00 $ 1,000.00 $ Linked to reservations system - Must be computerized 

Weight and Balance information 5,000.00 $ 5,000.00 $ Linked to Check In/reservations system

Total Ferry/proving Flight $ 284,050.00Reservation Options

Join Travelport or Amadeus full time 50,000.00 $ 175,000.00 $ Initial Fee and computers $2/ticket

Reservation system and ticketing $ 30,000.00

Interline/code share Software maintanance $ 45,000.00

 Total Reservation Options $ 250,000.00Technical Publications $ 75,000.00 Conservation to outside personnel

Salary 3 4 2,500.00 $ 30,000.00 $ Existing FA employees for 4 months

Additional Computers $ 10,000.00

Technical Publications Total $ 115,000.00Total Other $ 903,150.00

Total Start up Cost (Estimate) 2,563,602.26 $ 
Feb-14

Item Amount

DC Lawyer Deposit 10,000.00 $ Manuals Deposit 10,000.00 $ Computer Software Upgrades 1,000.00 $ Office Equipment 3,000.00 $ 

Total: 24,000.00 $ 

Mar-14

Fee $ 6,000.00

DC Lawyers Deposit 10,000.00 $ Manuals Deposit 10,000.00 $ Local hires x2 (writers) 4,000.00 $ Computers, office equipment 3,500.00 $ 

Total: 33,500.00 $ 

Estimated Spending Schedule
Apr-14

Fee $ 6,000.00

Manuals deposit 10,000.00 $ Hire Ops SME 5,200.00 $ Hire MX SME 5,200.00 $ Hire flight attendant SME 4,200.00 $ FAA visit in Honolulu 7,500.00 $ Office equipment for SME's 5,000.00 $ 

Total: 43,100.00 $ 

May-14

Fee $ 6,000.00

Salary - SME's 9,500.00 $ Salary - staff 4,000.00 $ 

Total: 19,500.00 $ 

Jun-14

Fee $ 6,000.00

Salaries - all 13,500.00 $ 
MX training facility audit 2,260.00 $ 

MX training 8,320.00 $ 

Total: 30,080.00 $ 

Jul-14

Fee 6,000.00 $ Salaries - all 13,500.00 $ 

Total: 19,500.00 $ 

Aug-14

Fee 6,000.00 $ Salaries - all 13,500.00 $ 

Total: 19,500.00 $ 

Sep-14

Fee 6,000.00 $ Salaries 13,500.00 $ 

Total: 19,500.00 $ 
Oct-14

Fee 6,000.00 $ Salaries 13,500.00 $ 

Total: 19,500.00 $ 

Nov-24

Fee 6,000.00 $ Salaries 13,500.00 $ 

Total: 19,500.00 $ 
Feb 24,000.00 $ 

Mar 33,500.00 $ Apr 43,100.00 $ May 19,500.00 $ Jun 8,320.00 $ Jul 19,500.00 $ Aug 19,500.00 $ Sep 13,500.00 $ Oct 13,500.00 $ Nov 19,500.00 $ 

TOTAL 213,920.00 $ 
Amount Spent

0

5000

100001500020000250003000035000400004500050000

Feb Mar Apr May Jun Jul Aug Sep Oct Nov

AmountSpent
AIRCRAFT COSTS

Insurance 25,000.00 $ Maintenance 200,000.00 $ Storing 12,000.00 $ Licensing 2,000.00 $ Repairing 15,000.00 $ 

Total aircraft 254,000.00 $ Two aircraft 508,000.00 $ 

$ 546.00$ 1,800.00$ 430.00

"The estimated monthly cost of leasing, insurmaintaining, storing, licensing and repairing aircraft (in exces of reserves)".

NOTE

"The total estimated cost per flight hour (itemizfor operating the aircraft". (Aircraft Operating Cos

Operating Cost per Block Hour ($)

Flight Crew CostFuel CostGround Handling
Inflight and Catering $ 480.00

$ 1,190.00$ 191.00$ 365.00$ 34.00$ 377.00

$ 5,413.00

Sales costs 200.28 $ 3.70%Admin costs 70.37 $ 1.30%Cost (Sales + Admin.) / Block Hr. 270.65 $ 

Total sales +admin 541.30 $ Total Operation Cost / Block Hour 5,954.30 $ 

Landing / ParkingInsAircraft Rent

Total Operating Cost per Block/hr.

Direct Main. - AirframeDirect Main. - Engines
Aircraft lease and deposits 300,000.00 $ 

Ferry to Guam 40,000.00 $ Aircraft acceptance inspection 10,000.00 $ Misc. 20,000.00 $ Professional fees $ 80,000.00

Proving flights $ 250,000.00

Total Administrative $ 700,000.00

Operations personnel 401,000.00 $ Maintenance personnel 56,000.00 $ 

Total Personnel (initial) 457,000.00 $ 

Administrative and Personnel Cost

"The total estimated cost to locate, and train personnel to operate, mainand manage the aircraft prior to revenue service".

NOTE

Personnel (initial)

Administrative

"The total estimated cost to ready aircraft for commercial passerevenue services on Freedom's operacertificate, including proving runs professional fees ("AdministraCosts").
Flight crew cost 47,000.00 $ 

Maintenance personnel 25,000.00 $ Management 12,000.00 $ 

Total Personnel (monthly) 84,000.00 $ 

$ 1,241,000.00

Total Administrative and Personnel costs

Personnel (monthly)
FA EXHIBIT U 

FA EXHIBIT V