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# Proposal to Provide Essential Air Service at

Kirksville, Missouri DOT-OST-1997-2515

Dated: 04/23/2010

Introduction

Charter Air Transport, Inc. is a Charter Operator that currently has Commuter Schedule Authority (Docket # DOT-OST2009-0187 ) with a fleet of four 30 seat Turbo Prop EMB-120 ai rcraft with an option to purchase 2 additional EMB-120

aircraft and two 19 seat BAE3200 Jetstream aircraft. We also operate aircraft including Hawker Jet, Citation Jet, Beech

Jet, and manages King Air-200 equipment. Charter Air Transport is an Air Carrier that truly provides the most flexibility

within its current fleet to operate aircraft a nd grow with each community we serve.

We have entered into a partnership Av iation Technologies, Inc., who commonly ow ns Public Charters, Inc., to enhance

our inventory distribution (seat sales) by also operating th ese flights as public charters and distributing them through the

major Global Distribution Systems (GDS) used by all of th e major Scheduled Airlines to sell their inventory to the

worldwide Travel Agent Community. So, in addition to the classic In ternet based Reservations System sales; EAS seats

would be available to the On-Line Travel Agencies (Trave locity & Expedia) as well as Travel Communities in North

America including Canada, Mexico, and the Ca ribbean for true global distribution.

While filing these seats as public charters is not required to serve EAS markets; the extra potential seat sales have

increased our market projections to over double the current ridership from their current levels of enplanements. In

addition to the EAS flight schedule, additional Charter Flight s are a great way to serve a community. Not only by adding

leisure destinations, but also by having aircraft based in the region. This allows for the most affordable charter service by

not having to re-position aircraft in from other locations. Now we can serve local events with local aircraft. This is how

we plan to increase enplanements at IRK. Re-building local s upport and loyalty to an airport is key to the success of both

the Airport and Charter Air.

Higher enplanements will mean less subs idy and lower costs. The DOT wants to pay less subsidy in these programs, the

community wants quality service at the right price, and the airline wants to provide good service without losing money.

There seems to be a common knowledge that airports and carri ers are afraid to lose their EAS funding, so what incentive

do they have to do better? With CAT’s creative scheduling, low pricing and additional charter flights, you can keep your

EAS funding and also provide better service to more markets.

Our goal is to maximize load factors, increase overall enpl anements, and fly proven rout es the community. Building up

the load factors and community allegiance will attract more ca rriers, and should eventually attract non-subsidized service.

All flights will be loaded into our IATA certified CRS sy stem (Computerized Reservations System) that currently

interfaces with the Sabre and Amadeus GDS systems. These sy stems are commonly used by Travel Agencies worldwide,

and are the portal of sales for large clearing houses like Traveloc ity and Expedia. Us ing Public Charters, Inc.’s advanced

CRS enables us to distribute seat inventory seamlessly th rough the GDS systems by settling the sales through ARC

(Airline Reporting Company). All ticket sales are additionall y protected when filing our flight inventory through the

public charter venue, as all ticket sales revenue is direct ed into a DOT certified & bonded escrow bank and held until

flight completion. All flight information displayed on the GDS systems would include the statement: “Operated by

Charter Air Transport”. This is exactly the way that commuter operators display for the major airlines.

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# We also utilize an Internet based Depart ure Control System (DCS) that includes a complete baggage and ticketing system

for a convenient airport check-in process. Since this system has Type “A” connectivity, it provides the basic components

for baggage and ticketing agreements with most main-line carriers. Since it is Internet based it enables us to print both

Boarding passes as if you were checking in on-line prior to go ing to the airport. Because the DCS described above is a

100% Internet based System; we are able to provide on-site check-ins with any connecting Carrier that permits Internet

check-ins as part of their web-site services. This enabl es the passenger to print their boa rding card for their connecting

flight at the EAS departure airport. Returning passe ngers may obtain their boarding pass at the Charter Air

Transport/Public Charters gate and do not have to go to the check-in counter. Once we get the passengers delivered to the

sterile gate areas; they would already have their connecti ng boarding cards and we would arrange a local transfer of

baggage either directly to the gate or through a local baggage arrangement with each carrier. Thus, we have created the

“virtual” interline. We continue to work with several major airlines for In terline and Ticketing agreements, and are

confident that; with our current business practices; that the tr avel experience will be practi cal, expeditious, and convenient

for each passenger.

We use a color coded “Disney Type” bagga ge coding for convenient recognition of interlined baggage both for out bound

and inbound flight baggage retr ieval and transfers. While we do not charge baggage fees, we must collect any fees that

may be charged by other carriers. These charges will be poste d on our web-site and collected at the time of check-in. We

have been advised by carriers like Southwest Airlines, that if a passenger is carrying a Southwest Boarding card or has a

Southwest ticket, they will be treated like a Southwest passenge r. This includes the acceptance of baggage. This is true

for most major airlines. There are several regulations that e xpect carriers to accommodate interlining traffic for feeder

flights.

Charter Air Transport would like to face the challenge of pr oviding service to EAS communiti es, mainly by identifying

better, but more condensed schedules that serve a larger part of community traffic for O&D (origination and destination)

routes. While we continue to work on our Interlinin g agreements, getting passengers to their final destination

conveniently and more efficiently has always been the goal.

Our system is certified E-Ticketing with both Sabre and Amadeus; and has plans to implement with Travelport

(Worldspan) in the near future. This additional certification would enable our seats to also be picked up by Orbitz and

Price Line for additional distribution opportunities.

Our proposed schedules provide sufficient time to connect to a ma jority of the airlines in the hub airport. However, our

schedules are not final and will be worked out with each ai rport to maximize connectivity options at each hub airport

Additionally we use the Check TSA, Inc. system that offers the latest security technologies that are used for TSA

screening including compliance with Secure Flight and CBP AQQ communication for International APIS transmissions.

You can visit their security web-site at www.CheckTSA.com for more information.

Both Charter Air Transport and Public Charters, Inc. ar e committed to the highest on- time performance and flight

completion records to our passengers. In the event of an aircra ft mechanical, our first resource to is use back up aircraft

from within the Charter Air Transport fleet. However, we are not limited to these resources and have access to retain subservice utilizing other certified FAA Air Carrier’s aircraft that could consist of aircraft type ranging from pressurized

Twin Turbo Prop aircraft to Corporate Jet aircraft. Should sub-service be necessary, we will utilize aircraft sufficient to

provide coverage based on the actual ticke ted passengers for each flight leg. Wh ether we use one or two aircraft to

complete a flight sequence, we provide this service with no surcharge or penalty to the EAS Community Service.

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# One of our mottos is “Go with Us so that we can Grow with You!” Charter Air Transport can offer daily service

operating multiple flights per day for any EA S route that is up to 150 nautical miles point to point from the origination

city to the destination city. We now offer the choice of opera ting with either the Jetstream 19 seat aircraft (or 18 with one

lavatory) or the 30 seat EMB-120 (including one Flight Attendant) to serve the community’s travel needs. We offer prime

time departures and arrivals, including early morning a nd late afternoon, to optimize both the O&D and potential

connecting passenger enplanements. Our desi re is to provide the local community flight service to an airport that will

provide the most vantage points for connecting into the National Transportation System at large.

The combined partnership between Charter Air Transport and P ublic Charters, Inc. is designed to fit each market need,

offering capabilities to provide additional ai rcraft capacities in order to grow with each community we serve; while

providing enhanced ticket sale distribution.

This Proposal Includes:

1. Non Stop Service – Appendix “A”

BAE3200 19 Seat Jetstream Aircraft

Aircraft Base: IRK

Serves Kansas City, Mo (MCI ) 2 times per day x6

12 Non Stop flights per week

Serves * Branson, Mo (BKG) 1 time per week June through August

*BKG is a NON Subsidized leisure route to attract passengers to IRK

Average One Way Fare: $69.00 Requested subsidy amount per year: $1,274,655.13

Current Subsidy $ (806,169.00)

Available

Seats Per Flight Available

Seats Per Week Available

Seats Per Year

9 216 11232 Per Seat Subsidy $ (71.77)

2009 Actual

Seats Per Flight 2009 Actual

Seats Per Flights 2009 Actual

Seats Per year

3 36 1877 Per Seat Subsidy $ (429.50)

Proposed Subsidy $ (1,383,015.13)

Available

Seats Per Flight Available

Seats Per Week Available

Seats Per Year

19 456 23712 Per Seat Subsidy $ (58.33)

Projected

Seats Per Flight Projected

Seats Per Week Projected

Seats Per year

10 240 12480 Per Seat Subsidy $ (110.82)



# Please refer to Appendixes “A” of this proposal for detailed flight schedules and cost models.

Please contact either Charter Air Transport, Inc. or Pu blic Charters, Inc. with any questions you may have.

For Charter Air Transport, Inc.: For Public Charters, Inc.:

Dave Lucas Jim Gallagher

Phone: 216-496-6808 Phone: 570-457-4147

Fax: 216-348-1432 Fax: 570-457-4113

Email: Dlucas@Businssaircraftgroup.com Email: JG727@aol.comAppendix"A"AndDocketDOT‐OST‐1997‐2515FareRange: Low59.00$High139.00$Aircraft: Seats:19AircraftBase:IRKACMIincl.Hotel&perdiem1,100.00$Catering‐perpax1.00$Stops Destin.GroundFees500.00$perturnReservationcost/pax15.00$IRK 6:45AM MCI 7:30AM 0OriginGroundFees400.00$perturnPercentofGDSbookings3MCI 9:30AM IRK 10:15AM 0DestinatonTurns2 perdayOperationalDaysPerWeek:6IRK 3:00PM MCI 3:45PM 0OriginationTurns3 perdayCallCenter:2,000.00$MCI 6:00PM IRK 6:45PM 0Fuelburn/hour105Avg.PassengerFare:69.00$Fuelprice/gallonaverage2.60$Seatsperflight19Advertisingperpax(r/t)2.50$Departuresperweek(o/w)24Stops Creditcardfee3.50%Departuresperweek(r/t)12IRK 9:00AM BKG 10:20AM 0TravelAgentCommission:10%BlockHoursPerSegment(avg)0.71BKG 12:00PM IRK 1:15PM 0LoadFactor:50%*BKGISNONSUBSIDIZEDPercentofTravelAgentSales30%ItemJanFebMarAprMayJunJulAugSepOctNovDecYearTtlWeeksperMonth4 34 34 34 34 34 34 34 34 34 34 34 351 60DeptArriveProposaltoProvideEssentialAirServiceAtKirksville,MissouriBAE3200JetstreamDeptArriveNONSTOPIRK‐MCIBAE320019SEATJETSTREAMSchedule:DailyX6(Sun‐Fri)Schedule:Day6(SatOnly)JunethroughAugust*WeeksperMonth4.34.34.34.34.34.34.34.34.34.34.34.351.60DaysperWeek 6 6 6 6 6 6 6 6 6 6 6 6DeptsperWeek 24 24 24 24 24 24 24 24 24 24 24 24DeptsperMonth 103 103 103 103 103 103 103 103 103 103 103 103 1236Avg.BlockperLeg 0.71 0.71 0.71 0.71 0.71 0.71 0.71 0.71 0.71 0.71 0.71 0.71TtlBlockperMonth 73.13 73.13 73.13 73.13 73.13 73.13 73.13 73.13 73.13 73.13 73.13 73.13 877.56LoadFactor 50% 50% 50% 50% 50% 50% 50% 50% 50% 50% 50% 50%Seatsperflight 19 19 19 19 19 19 19 19 19 19 19 19Paxperflight 10 10 10 10 10 10 10 10 10 10 10 10Avg.PaxFare69.00$69.00$69.00$69.00$69.00$69.00$69.00$69.00$69.00$69.00$69.00$69.00$TtlPaxperMonth 1,032 1,032 1,032 1,032 1,032 1,0321,032 1,032 1,032 1,032 1,032 1,032 12,384TicketRev.71,070.00$71,070.00$71,070.00$71,070.00$71,070.00$71,070.00$71,070.00$71,070.00$71,070.00$71,070.00$71,070.00$71,070.00$852,840.00$CreditCardFee (2,487.45)$(2,487.45)$(2,487.45)$(2,487.45)$(2,487.45)$(2,487.45)$(2,487.45)$(2,487.45)$(2,487.45)$(2,487.45)$(2,487.45)$(2,487.45)$(29,849.40)$FET&7.5% (4,880.97)$(4,880.97)$(4,880.97)$(4,880.97)$(4,880.97)$(4,880.97)$(4,880.97)$(4,880.97)$(4,880.97)$(4,880.97)$(4,880.97)$(4,880.97)$(58,571.67)$AgentComm. (1,983.35)$(1,983.35)$(1,983.35)$(1,983.35)$(1,983.35)$(1,983.35)$(1,983.35)$(1,983.35)$(1,983.35)$(1,983.35)$(1,983.35)$(1,983.35)$(23,800.19)$TtlOp.Revenue 61,718.23$61,718.23$61,718.23$61,718.23$61,718.23$61,718.23$61,718.23$61,718.23$61,718.23$61,718.23$61,718.23$61,718.23$740,618.75$DirectOperatingCostACMI 80,443.00$80,443.00$80,443.00$80,443.00$80,443.00$80,443.00$80,443.00$80,443.00$80,443.00$80,443.00$80,443.00$80,443.00$965,316.00$Fuel 19,964.49$19,964.49$19,964.49$19,964.49$19,964.49$19,964.49$19,964.49$19,964.49$19,964.49$19,964.49$19,964.49$19,964.49$239,573.88$Ground56,760.00$56,760.00$56,760.00$56,760.00$56,760.00$56,760.00$56,760.00$56,760.00$56,760.00$56,760.00$56,760.00$56,760.00$681,120.00$Catering1,032.00$1,032.00$1,032.00$1,032.00$1,032.00$1,032.00$1,032.00$1,032.00$1,032.00$1,032.00$1,032.00$1,032.00$12,384.00$TtlDirectOp.Cost 158,199.49$158,199.49$158,199.49$158,199.49$158,199.49$158,199.49$158,199.49$158,199.49$158,199.49$158,199.49$158,199.49$158,199.49$1,898,393.88$IndirectOperationingCostsAdvertizing 2,580.00$2,580.00$2,580.00$2,580.00$2,580.00$2,580.00$2,580.00$2,580.00$2,580.00$2,580.00$2,580.00$2,580.00$30,960.00$GDS 5,160.00$5,160.00$5,160.00$5,160.00$5,160.00$5,160.00$5,160.00$5,160.00$5,160.00$5,160.00$5,160.00$5,160.00$61,920.00$CallCenter 2,000.00$2,000.00$2,000.00$2,000.00$2,000.00$2,000.00$2,000.00$2,000.00$2,000.00$2,000.00$2,000.00$2,000.00$24,000.00$TtlIndirectOp.Cost 9,740.00$9,740.00$9,740.00$9,740.00$9,740.00$9,740.00$9,740.00$9,740.00$9,740.00$9,740.00$9,740.00$9,740.00$116,880.00$TtlOp.Cost167,939.49$167,939.49$167,939.49$167,939.49$167,939.49$167,939.49$167,939.49$167,939.49$167,939.49$167,939.49$167,939.49$167,939.49$2,015,273.88$OperatingP/L (106,221.26)$(106,221.26)$(106,221.26)$(106,221.26)$(106,221.26)$(106,221.26)$(106,221.26)$(106,221.26)$(106,221.26)$(106,221.26)$(106,221.26)$(106,221.26)$(1,274,655.13)$CumulativeP/L(106,221.26)$(212,442.52)$(318,663.78)$(424,885.04)$(531,106.30)$(637,327.57)$(743,548.83)$(849,770.09)$(955,991.35)$(1,062,212.61)$(1,168,433.87)$(1,274,655.13)$(1,274,655.13)$CostPerDept. 1,630.48$1,630.48$1,630.48$1,630.48$1,630.48$1,630.48$1,630.48$1,630.48$1,630.48$1,630.48$1,630.48$1,630.48$1,630.48$