# SovereignAir,Inc.
June 16, 2010 DennisJ. DeVany, Chief EAS 

### &DomesticAnalysis Division, X-53 Office ofAviation Analysis Department ofTransportation 1200 NewJersey Ave. SE Washington, DC 20590 Re: Proposal to Provide Essential Air Service at: Laramie, Wyoming, DOT-OST-1997-2958 Worland, Wyoming, DOT-OST-1997-2981

Dear Mr. DeVany: In response to Order2010-5-14, Sovereign Air, Inc. offersthe following proposal: ,- "T' -""! I{ '-- 1

Sovereign Air, Inc. (SAl) is planningto use eithertwo 9-seat King Air's ora Beech 1900and a9-seat King Air aircraftforthese Essential Air Service routes. Ourflights will service onlythe EAS cities and the DEN Hub. Sovereign Air believes thatwith good schedules, proper pricing and a recovering economy, the load factors will likely increase in these markets. SAl will base its aircraft, crews and maintenance personnel, banking and purchase fuel in Worland and Laramie. This will help keep the EAS monies in the local communities. Additionalflights will be added as needed to accommodate periods ofincreased demand forthe UniversityofWyoming. SAl will have baggage and ticketagreementswith the major air carriers in Denver by the start ofthis EAS service. SAl will also have cargo agreementsfor both domesticand international airfreight movements. SAl has been HAZMAT approved and will be working in conjunction with hospitalsto expedite various HAZMAT materialsthatthey need totransport. SAl's goal is towork hand-in-hand with EAS communitiesto reduce the need for EAS subsidies withinthe nextfourto six years. Sovereign Air is currently in the process ofacquiring its Scheduled Service Authorityand anticipates being able to startthis Essential AirService by September 1, 2010. Sovereign Airwill be fully integrated intothe Global Distribution System (GDS) in conjunction with Worldspan. SAl is nottied tojust one airline, allowingSovereign Air bettervisibility in thevarious reservation systems. Passengers will have a broad range ofchannels through which to purchase tickets, including all airline reservation systems and travel agencies. Customerswill be able to call our reservation office orvisit ourwebsite to bookflights. Passengers can also purchase tickets and make reservations at ourticket counters.SAl's final schedules will be developed by the EAS City Airport Boards and SAl to reduce layovertimes in DEN and provide the best possible arrival and departure timesforthe travelling public. As such, the following schedules will likely be adjusted: Proposed Schedule Options WRL Schedule

Fit # Freq From TO Dpt-Arr From TO Dpt-Arr 10 1234567 WRL LAR 6:50 -7:50 LAR DEN 8:00-8:40 11 1234567 DEN LAR 9:30-10:20 LAR WRL 10:30-11:20 20 23456 WRL LAR 12:00-12:50 LAR DEN 01:00-01:40 21 23456 DEN LAR 02:30-03:10 LAR WRL 03:20-04:10 30 1234567 WRL LAR 05:00-05:50 LAR DEN 06:00-06:40 31 1234567 den LAR 08:00-08:40 LAR WRL 08:50-09:30

LAR Schedule

Fit # Freq From TO Opt Arr 4 1234567 LAR DEN 6:30am 7:10am 10 1234567 LAR DEN 8:00am 8:40am 20 1234567 LAR DEN 1:00pm 1:40pm

6 1234567 LAR DEN 4:00pm 4:40pm 30 1234567 LAR DEN 6:pm 6:40pm

5 1234567 DEN LAR 7:30am 8:10am 11 1234567 DEN LAR 9:30am 10:20am 21 1234567 DEN LAR 2:30pm 3:10pm

7 1234567 DEN LAR 6:00pm 6:40pm 31 1234567 DEN LAR 8:00pm 8:40pm

### Option 1: 

### Two 9-seat King Airs Sovereign Air, Inc. Annual Compensation Requirementfor Essential Air Service for WRL-LAR-DEN Aircraft Type Available Seats Per Departure Passengers Per Trip
Block Hours Departures Total Passengers Average Fare

Revenue Passenger Miles Available Seat Miles Passenger Revenue Other Rev. @ 

### .6 of pax. Rev. %

Total Revenue Aircraft and Hull Insurance Fuel and Oil Flying Operations Other Direct Costs Maintenance

Total Direct Costs Total Indirect Costs $130 one wayWRL-DEN $ 90 one way LAR-DEN Two 9-seats King Air 

### 9 4.4


### 6,538 5,448 25,000

8,065,764 16,131,528 $2,750,000.00 $16,500.00 $2,766,500.00

$220,000.00 $1,588,923.05

$500,377.99 $822,444.50 $358,592.56 $3,490,338.10 $1,325, 372.44

Total Operating Expenses $4,815,710.54 Operating Loss $2,049,210.54 Profit @ 

### 5% $102,460.53 Annual Compensation Requirement $2,151,671.07 

### Completion Rate 97% Load Factor 49%

### Option 2: One Beech 1900and one 9-seat King Air (1900 operatestwo RT per day between LAR and 

### DEN only, but available for extra legs) Sovereign Air, Inc. Annual Compensation Requirement for Essential Air Service for WRL-LAR-DEN Aircraft Type Available Seats Per Departure Passengers Per Trip Block Hours Departures Total Passengers Average Fare

Revenue Passenger Miles Available Seat Miles Passenger Revenue Other Rev. @ 

### .6 of pax. Rev. %

Total Revenue Aircraft and Hull Insurance Fuel and Oil Flying Operations Other Direct Costs Maintenance

Total Direct Costs Total Indirect Costs $130 one wayWRL-DEN $ 90 one way LAR-DEN 1900 and 9-seat King Air 9 and 19 Avg 8 6,538 5,448 25,000

8,065,764 16,131,528 $2,750,000.00 $16,500.00 $2,766,500.00

$220,000.00 $1,588,923.05

$500,377.99 $1,022,444.50

$358,592.56 $3,690,338.10 $1,325,372.44

Total Operating Expenses $5,015,710.54 Operating Loss $2,249,210.54 Profit @ 

### 5% $112,460.53 Annual Compensation Requirement $2,361,671.07



### Load Factor 42%Customer safety and service are Priority One with SAL Sovereign Air looksforward to providing Essential Air Service to both Worland and Laramie.

Sincerely,

Jon Payne, CFO Sovereign Air, Inc.