## BEFORETHE DEPARTMENT OF TRANSPORTATION OFFICE OF THE SECRETARY WASHINGTON, D.C.

Application of ) ) 

## Menagerie Enterprises, Inc. d/b/a ) DOCKETDOT-OST-2014-0192 MonarchAir ) ) 

## For authorityto conduct scheduled ) Passengeroperations as a commuter air ) Carrierunder49 U.S.C. 41738 )

APPLICATION OF MENAGERIE ENTERPRISES, INC. D/B/AMONARCHAIR 

## Response to Second Information Request
Communications withrespectto this document should be sentto:

January 23,2015 RebeccaB. MacPherson Jones Day 51 LouisianaAve., NW Washington, DC 20001 Telephone: 202-879-3939 Fax: 202-626-1700 Email: rrnacpherson@jonesday.corn

### Application of BEFORETHE DEPARTMENT OF TRANSPORTATION OFFICE OFTHE SECRETARY WASHINGTON, D.C.

Menagerie Enterprises, Inc. d/b/a MonarchAir 

## ) ) ) ) ) 

## ) ) ) 

### DOCKETDOT-OST-2014-0192

For authorityto conduct scheduled Passengeroperations as a commuterair Carrierunder49U.S.C. 41738

APPLICATION OF MENAGERIEENTERPRISES, INC. DIB/ 

### A MONARCHAIR 

## Response to Second Information Request

General Information 

## I. The supplemental information datedDecember 23, 20I4,filedbyMonarch didnotcontain the requisite certificationstatementaffirmingthat the information submittedwas true and correct. Therefore, pleaseprovide the certification. Please seethe certification submission atthe endofthis documentwhich covers boththis submissionandthe December 23, 2014 submission. Managementand Key Technical Personnel 

## I. Pleaseprovide a resumefor Mr. RaymondSawtelle, detailinghis experience, expertise and responsibilities. Alsoprovide the compliance history information as requiredbysections 204.3(!), (m), (o), and(p) 

## of our rules. Raymond Sawtelle'sresume is attached as Exhibit 1to this submission. 

## A listof allactions andoutstanding judgments for more than $5,000 againstany relevant corporation, keypersonnelemployed(or to be employed) byany relevant corporation, orperson havingasubstantial interest in anyrelevant corporation, includingthe amount of eachjudgment, thepartyto whom it 

## ispayable, andhow long it

## has been outstanding. (I

## 4 CFR 204.3(l))


### 2

## None. The numberof actions andoutstanding judgmentsof less than $5,000 againstany relevantcorporation, keypersonnelemployed(or to be employed) byany relevant corporation, orperson havinga substantial interest in any relevant corporation, andthe totalamountowedby each on suchjudgments. (14 CFR 204.3(m)) None. A description of the currentstatus of allpendinginvestigations, enforcement actions, and formal complaints filedby the Department, includingthe FAA, involvingthe applicantoranyrelevantcorporation, anypersonnel employed (or to be employed) byanyrelevantcorporation orperson havinga substantial interest in anyrelevantcorporation, regardingcompliance with the Statute or orders, rules, regulations, orrequirements issuedpursuantto the Statute, andany corrective actions taken. (If an applicanthas a compliance historythatwarrants it, 

## additional iriformation maybe required.) (14 CFR 204.3(o)) None. A description of all charges of urifair ordeceptive oranticompetitive business practices, orof fraud,felony orantitrustviolation, broughtagainstany relevant corporation orperson havinga substantial interest in any relevant corporation, ormember of the keypersonnelemployed(or to be employed) byany relevant corporation in thepast I0years. Such descriptions shall include the disposition or currentstatus of each suchproceeding. (14 CFR 204.3

## (p) Synergy v. Groesbeck, etal.

- Dallas County district court, Dallas, TX The above-listed actionwas institutedby Synergy Aviation ("Synergy"), a company ownedbyMenagerieEnterprises, Inc.'sformer chieffinancial officer, Paul Clark. Menagerie Enterprises, Inc. does notpossess a financial interest in Synergy. Synergy soughtrecovery ofa commission onthe sale ofan aircraftto Groesbeck. Groesbeck's defense includedthe assertion ofa third party action against Menagerie Enterprises, Inc. and counterclaims against Synergy and Clark, contending violations oftheTexas Deceptive Trade Practices Act ("DTPA") and assertions offraud. Menagerie Enterprises, Inc. and Clark asserted counterclaims for frivolous DTPA claims against Groesbeck. Menagerie Enterprises, Inc., Synergy, Clark and Groesbeck agreed to a mutual release ofall claims withoutthe exchange ofany additional consideration, resulting inthe dismissal of Groesbeck's claims againstMenagerie Enterprises, Inc., Synergy and Clark in 2014.

Financial Position and Operating Plans
3

## Anapplicant for commuterauthority is expectedto bepreparedtofullyprosecute its application atthe time it isfiled. With respect tofinancialfitness, the applicant is requiredtoprovide current financial data, andthreeyears of historic financial data, togetherwith adetailed forecast of itspre-operatingcosts andapro-forma forecastprofitandloss statementreflecting all revenues andexpenses the applicant expects to earn/incurduring itsfirstyear of actual commuteroperations. In addition, the companymustdemonstrate that ithas obtainedall of the funding neededto meetour financialfitness test or, ataminimum, that ithas a reasonableplan for doingso. Pleaseprovide thefollowing:

1. In the December 23, 2014, submission, you indicate thatMonarch willneed$422,349 to commence theproposedcommuter operations. DoesMonarch consider this as itspre-operating cost forecast? 

# If so, please explain how these costs were derived. 

# If not,pleaseprovide apreoperatingcost forecast that identifies all costs expectedto be incurredbyMonarchprior to the actualstartof its operations. The $422,349 provided earlier consisted ofboththepre-operating cost forecast andthe cost associated withthe first full month ofoperations. As such, itis overstated. Monarch estimates thatthe pre-operating costforecast will be approximately $88,800. Thatcost consists ofthe following: Professional services (i.e., legal and accounting fees) and applicationfee Salaries for two-man crew Aircraft insurance $60,000 $25,800 $3,000 In addition, as indicated onthe spread sheetprovided as Exhibit 5 to this submission, the first year's operating expenses are anticipatedto cost a total of$6,387,469.16. 1 

## A simple 25% of these costs results in a projected financial fitness threshold of$1,684,867.29 ($1,596,867.29 

## + 88,000). As indicated in Exhibit 2 to this submission andthe separate documentation submittedby Rise, MonarchAirwill have accessto nearly $2 million in cash atthe initiation ofcommuter service. This is morethan sufficientto meet DOT's financial fitness threshold. Please notethat the numbers usedto calculate the financial fitness threshold were derived from theportionofthe spreadsheets limitedto Rise-only operations. This is because Monarch

1

### This number is lowerthan the anticipated first year's operating expenses projected in the December23, 2013 submission because ofthe dramatic decrease injetfuel prices. A more thorough explanation ofthe fuel projection is provided in response to question 4 below. Atthe original estimates, the cost for the first year of proposed operations would be $7,122,268.97. The financial fitness threshold would be $1,868,567.24 ($1,780,567.24 

### +$88,000).



## 4

## Air will continueto operate as an on-demand carrier andwill incur expenses unrelatedto the Rise operations. The income associated with these operations has not been used in any way to offsetthe costs associated with the Rise operations. As such, they should not be included in the determination offinancial fitness. Indirect expenses have been allocatedbetween Rise and nonRise operations as indicated in both exhibit Gto the December23, 2014 submission and Exhibit 5to today's submission. 2. Inyourapplication,you indicatedthatMonarch intends to addthree aircraftto its fleetandprovidedinformation related to the financing of each of theaircraft. Theforecasted profitandlossstatementspecificallystatesthe interestpayments foreach of theaircraft. However, weare unableto determinehowMonarch calculatedtheaircraftinterestpayments sincedetailed information regarding theaircraft financingfrom Legacy Texas Bankwasnot provided. Thus weaskthatyoupleaseprovide the following:

a. The line of credit from Legacy Texas Bankthatwillbe used tofinance the threeaircraft. This shouldinclude thetotalavailable line of credit, the amountdrawn down to date, the termsof payment, anyconditionsthatmust be metbefore the funds areadvanced, andtheexpiration date. 

## The aircraftthatwill beused inthe Rise operationswill notbe purchasedundera line ofcredit. The line ofcreditauthorizedbyLegacy Texas Bankis provided for the supportofMonarchAir's day-to-dayRise operationsintheeventthatinsufficientfunds areavailablein the Rise line of credit. Each aircraftwill befinanced bya separate securityagreement,with the aircraftservingas collateral for eachloan agreement. Theletterofcredit will notbeutilized to purchasethe aircraft, although itcouldbeusedto servicethemonthlyleaseorinterestpayment. A letterfrom LegacyTexas Bankclarifyingthe financing arrangementsis providedas Exhibit 2tothis submission.z Menagerie Enterpriseshas alreadypurchasedthefirst aircraft through N111RZ, LLC, alimitedliabilitycorporationestablishedbyTrey Sawtellefor liabilitypurposes. MonarchAirleasesthe aircraftfrom N111RZ, LLC for the amountof$38,150.00 permonth. A 

## copyofthepromissorynote from N111RZ, LLC to LegacyTexas Bank, the corporatedocuments for N111RZ, LLC andthe leaseagreementbetweenN111RZ, LLC and Monarch Air areattached as Exhibit 3to this submission. b. An updated first-yearprofitandlossforecast thatreflects the interest paymentsassociatedwith the termsof theaircraft financingfrom Legacy Texas Bank.

2 

### Please note that Legacy Texas Bank has increased the available line ofcredit from $800,000, as noted in previous submissions, to $1 ,05,000.


## 5

## Becausethe aircraftrecentlyacquiredbyMonarchAiris coveredbya lease agreementbetweenitand N111RZ, 

## LLC which establishes a monthly paymentof$38,150.00 permonth, theprofitandloss forecasthas been updatedtoreflectthatdollaramountas thecostofRise aircraft 1. The costs associated with servicingRise aircraft 2and 3 assumethe aircraftwill be procuredthrough a securedbankloan as described above. Theterms ofthe loanwill determinetheapplicableinterestrate and its amortization. MonarchAirhas assumed aninterestrateof5.00%. In addition, the profitand loss forecasthasbeenamendedtoreflectthe dramaticreduction in fuel costs. Fuel costs constitutethelargestsingle monthlyexpense associatedwiththeproposed Rise operations. Therevisedbalance sheetis provided as Exhibit4 tothis submissionandtherevised profitandloss forecastis provided as Exhibit 5to this submission. 3. Inyour application andsupplemental information submitted, youstatedthatMonarch intends to support the Rise operations bydrawing on a line of creditprovidedby Rise. However, we are unable to ascertain the veracity of this statementwithoutadditional information on Rise. Therefore we askthatyoupleaseprovide thefollowing:

a. The line of creditagreementbetween Rise andMonarch that includes the total available line of credit, amountdrawn down, terms ofrepayment, any conditions thatmustbe metbeforefunds willbe advancedandthe expiration date. 

## Initially, theparties assumedthatthere would be a line ofcreditbetween Rise and Monarch, but as plans evolved, Monarch Airrequired Rise to establish aline ofcreditfor Monarch Air's sole benefitto guarantee Rise's payment. As required, Rise has established a $500,000 line ofcreditwith Liberty Capital Bank ofAddison, Texas. Collateral for that line of creditis acertificate ofdepositvalued at $500,000. Rise will separatelyprovide copies ofkey documents governingthat line ofcredit, although someparts maybe coveredby amotion for confidential treatment. b. Thirdpartyverification of Rise'sability to extendthe line of credit to Monarch, includingRise's current (within 3 months)financial statements, togetherwith their accompanying explanatory footnotes. Since Monarch is relyingonRise, we needto determine thatRise has the necessary financial wherewithaltofulfill any financial commitmentmade to or on behalf of Monarch. 

## Rise will provide its financial statements and confirmationofbankbalances in a separate filing, some ofwhichmay be coveredby amotion for confidential treatment. 4. Pleaseprovide the explanatory footnotes associatedwith theprojectedbalance sheetand profitandloss statementsubmittedon December 23, 2014. 

## Monarch charter department expense

6

## We understand that there was a specific question related to the line item 5 under "EXPENSES" of the Monarch Air Projected Revenues and Expenses (Line item 5 under "EXPENSES" for the non-Rise Projected Revenues and Expenses) This expense category does not apply to the anticipated Rise operations. It 

## is comprised of miscellaneous expenses such as American Express annual enrollment fees, identification badges, holiday gifts such as wine baskets to our fleet owners, etc. The large portion ofthis estimated expense is for the hosting and updates ofour charter software, which is approximately $10,000 ofthe overall budget number. This expense has been running less than half ofthe overall budgetinprevious years. However, we leftthe budgetnumberthe same for this forecast. Additionally, we have verified our calculations to insure the expense numbers are totaling correctly as we understood there was some concern that this line item of $4,166.67 per month number was not reflected in the totals. When we total all items in our spreadsheet, the projected expense is accounted for. We note that the depreciation budget figure is calculated at the same costof$4,166.67 permonth, and perhaps this is where the disagreementin numbers manifests. Rise-only operations COST OF GOODS SOLD 

## Rise aircraft I, 2, or 3 miscellaneousfees (line items 7, 8, 9)

- the line items reflect a yearly forecasted budget per aircraft of$43,400.04, which is normalized on a monthly basis (aircraft 2 and 3 are pro rated to reflect their acquisition later in the year). The projected costs cover miscellaneous aircraft expenses such as manufacturer service plan annual enrollment fees, aircraft manufacture special inspection program documentation, aircraft cleaning and detailing, and general upkeep expenses on overall wear and tear items such as aircraft exteriorpaint. 

## Rise aircraft I, 2, or 3 refurbishment (line items 10, 11, 12)- a forecasted yearly budget per aircraft of$15,000 normalized, on a monthly basis to cover aircraft interior refurbishment such as re-conditioning or replacement of the leather seats, carpet replacement, woodwork, etc. (aircraft 2 and 3 are pro rated to reflecttheir acquisition laterinthe year). 

## Rise aircraft I, 2 or 3 fuel costs (line items 16, 17, 18)

- original forecasted cost offuel required for the flight scheduled was based on the hourly use of 129 gallons perhour multiplied by $4.02 per gallon, which equals $518.58 per flight hour. With this hourly fuel figure, the aircraft fuel budgetwas calculated as follows:

• Aircraft 1: 2,218.67 hours annual utilization multiplied by $518.58, then divided by 12 months ofoperation equals $95,879 per month offuel costs. • Aircraft 2: 1,664 hours annual utilization multiplied by $518.58, then divided by 9 months ofoperation equals $95,879 per month offuel costs. • Aircraft 3: 825 hours annual utilization multiplied by $518.58, then divided by 6 months ofoperation equals $71,304permonth offuel costs.

7

## However, Monarch Air's fuel prices have dropped over 30% to a price of $2.81 per gallon per our currentpricing matrix provided by our fuel provider dated January 14, 2015. This is consistent with the change in fuel prices reported by the United States Department ofEnergy in the 

## Weekly Petroleum Status Report. The average cost of U.S. Gulf Coastjet fuel for the week ending October 17, 2014 was $2.428 per gallon,3 

## while the average cost ofU.S. GulfCoast jetfuel for the week ending January 9, 2015 was $1.634 per gallon.4 

## Given the dramatic drop in its own prices and U.S. Government projections on the price ofoil for 2015, Monarch Air believes that it is reasonable to adjust its projected fuel budget to reflect current prices. The Department of Energy, U.S. Energy Information Administration's 

## Short-Term Energy Outlook January 2015 5 

## predicts that U.S. crude oil prices will average between $55 perbarrel and $58 perbarrel in 2015, depending on the type ofoil.6 

## This projection is significantly lowerthan the average price ofoil in 2014 ofapproximately $93 perbarrel to $99 per barrel, depending on the type ofoil.7 

## As such, the projected fuel costs provided in revised line items 16, 17, and 18, which are based on actual prices provided by Monarch Air's fuel provider, appear warranted and reasonable. The difference in fuel costs quoted to Monarch Air from its fuel provider when the initial application was filed and the fuel costs quoted to Monarch Air today equate to a $734,821.53 total yearly reduction of fuel expense based on the proposed annual utilizations of the three aircraft listed above. This reduction in fuel expense has been adjusted in our most recent Balance Sheet and Projected Revenues and Expenses statement. Forecasted cost offuel required for the flight scheduled based on the hourly use of 129 gallons per hour multiplied by $2.81 per gallon equals $362.49 per hour. With this hourly fuel figure, the aircraft fuel budget was recalculated as follows:

• Aircraft 1: 2,218.67 hours annual utilization multiplied by $362.49, then divided by 12 months ofoperation equals $67,020.47permonth offuel costs.

3 

### Weekly Petroleum Status Report, 

### data for week ended: October 31,2014, DOE/EIA-0208(2014-44), p. 25, http://www.eia.gov/forecasts/steo/pdf. 4 

### Weekly Petroleum Status Report, 

### data for week ended: January 9, 2014, DOE/EIA-0208(2014-54), p. 25, http://www.eia.gov/forecasts/steo/pdf. (hereinafter "WPSR2014-54") 5

### Monarch Air is aware ofno official governmentpublicationsthat detail the projected future costs of jet fuel overthe next 12 months. The FAA discusses the projected cost ofoil in 2014 and 2015 in its March 12, 2014 FAA AerospaceForecastFiscal Years 2014-2034, 

### http://www.faa.gov/about/office-org/headquartesoffices/apl!aviation-forecasts/aerospace-forecasts/2014-2034/media/faa-aerospace-forecasts-fy20 14-2034.pdf.

. However, the forecast fails to account for the unanticipated, dramatic drop in oil in the later part of2014 and opined that "Oil prices are forecast to decline to around $92 to $93 perbarrel by 2015116." Id. At p. 38. Accordingto the Department ofEnergy's Energy Information Administration, the actual average price ofoil atthe end of2014 ranged between $55.58 perbarrel and 58.69 perbarrel, depending on the type ofoil. WPSR2014-54, p. 23. 6 

### U.S. EnergyInformationAdministrationShort-term Energy OutlookJanuary 20I5, 

### p.l, http://www.eia.gov/forecasts/steo/pdf. 7 

### Price summary for U.S. EnergyInformationAdministrationShort-term Energy OutlookJanuary 20I5, 

### http://www.eia.gov/forecasts/steo/?src=home-bI.


## 8

## • Aircraft 2: 1,664 hours annual utilization multiplied by $362.49, then divided by 9 months ofoperation equals $67,020.37 permonth offuel costs. • Aircraft 3: 825 hours annual utilization multiplied by $362.49, then divided by 6 months ofoperationequals $49,842.37 permonth offuel costs.

Rise aircraft I, 2, or 3 maintenance departmentparts and supplies 

## (line items 22, 23, 24)

- based on a flight hourly rate of $148.95 calculated at actual labor and part replacement cost. This figured was based on industry averages from publications such as Conklin & 

## de Decker Aircraft Cost Evaluator based on the King Air 350 make and model, then reduced to actual cost with no retail mark-up. Rise aircraft I, 2, or 3 maintenance engine reserves 

## (line items 25, 26, 27) -based on a flight hourly rate of$261.42 for reserves towards engine hot sections and overhaul. This figure was based on industry averages from publications such as Conklin & 

## de Decker Aircraft Cost Evaluatorbased onthe King Air 350 make and model. Rise required aircraft supplies 

## (line item 31)

- miscellaneous required items for the 3 aircraft outside the normal maintenance inspection and repair costs. This figure is based on an annual budget of$25,000 and is normalized over a 12-month period. Examples would be items such as navigational charts, GPS database updates, navigational database updates, terrain awareness and warnings updates, and flight management system updates. Rise trip and crew expenses 

## (line items 33)- miscellaneous crew expense items such as meals, flight crew ground transportation costs, and hotels. With no scheduled overnight stays, crew expenses will primarily consist ofmeal costs away from base. This figure is based on an annual budget of$83,360.04, assumes the addition ofaircraft 2 and 3 in months 4 and 7, respectively and is normalized over a 12-monthperiod. EXPENSES Rise wages andsalaries- administrative staff(line 

## item 33)- salary and benefits budgeted for two employees due to the Rise operation growth normalized over a 12-month period. The two positions are for a full-time charter client service representative at $19.00 per hour and a fulltime accountpayable assistant at $22.00 perhour. Rise wages and salaries aircraft I, 2 or 3

- maintenance 

## (line item 35)

- salary and benefits budgeted for additional maintenance personnel for positions such as general aircraft technician and floor supervisor. ForRise aircraft 1, this figure is based on an annual budget of$75,000 and is normalized over a 12-monthperiod to hire an experienced aircrafttechnician. ForRise aircraft 2 and 3, this figure is based on an annual budget of$166,666 and is normalized over a 12-month period to hire an entry-level aircraft technician and one floor technician supervisor. Salaries are commensurate with the technicians experience and expected duties. With this in mind, the hourlypay rate perindividual will vary from $22 perhourto $37perhour.

9

## Rise wages andsalaries aircraftfUght crew (line items 36, 37, and 38)- salary and benefits for flight crew needed for the proposed schedule. Foreach flightcrew (i.e., captain and first officer), salary and benefits are figured at $12,900permonth.

• Aircraft 1: two flight crew for the proposed schedule totaling $25,800 permonth. • Aircraft 2: two flight crew for the proposed schedule plus one flight crew member for reserve totaling $38,700 permonth. • Aircraft 3: two flight crew for the proposed schedule plus one flight crew member for reserve totaling $38,700permonth.
Certification
The contents ofthis application, as well as the application submission dated December 23, 2014, and the attachedexhibits are true and correctto the bestofmy knowledge and belief. Pursuantto Title 18 United States code Section 1001, I, Trey Sawtelle, in my individual capacity and as the authorized representative ofthe applicant, have not in any mannerknowingly and willfully falsified, concealed or failed to disclose any material fact ormade any false, fictitious, orfraudulent statement orknowingly used any documents which contain such statements in connection with thepreparation, filing orprosecution ofthe application. I understandthat an individual who is found to have violated theprovisions of 18 U.S.C. section 1001 shall be fined orimprisoned not more than five years, orboth.

Attachments: Exhibits

# -~-~~~x 

# usz..LTrey Sawtelle, President

10

# Raymond F. SawtelleJr. 1775 CR 1215 Savoy, Texas 75479

(903) 965-0505

PROFESSIONAL EXPERIENCE



### June 1986- Present

October 1966

- February 1997

November 1958

- October 1966 Monarch Air, Addison, Texas. Owner/Director of an integrated aviation service company specializing in aircraft charter, sales, flight training and maintenance with year-after-year success achieving revenue, profit, and business growth objectives with start-up, turnaround, and rapid-change environments. FAA approved and certified facility for Part 135, 141, and 145 operations. During the years, several positions from President, ChiefPilot, Director of Operations, and Check Airman were held.

Delta Airlines, Dallas/Ft. Worth, Texas. Employed as a FAR Part 121 line pilot and retired as an international Captain flying the Lockheed L-1011 Tri-Star.

United States Air Force. Served 8 years as Captain in the 81h 

### Tactical Fighter squadron flying the F-100 Super Sabre fighter overseas and domestic US.

FLIGHT EXPERIENCE 

### Airline Transport Pilot Certified Flight Instructor Airframe and Power Plant Certificate Captain Type Ratings: B-727, DC-9, L-1011, CE-500, IAI-1124 Total FlightTime: Over 30,000 Hours Clear FAA record with no accidents or violations



# Exhibit 1

# G B A N K 

### January 20, 2015

To Whom It May Concern:

As noted in my letterdated December 18, 2014, LegacyTexas Bank has agreed to provide Menagerie Enterprises, Inc. d/b/a Monarch Airwith the necessary financingto support its anticipated operatiol)swith Rise, LLC. We anticipatethatthisfinancing will require two parts. First, LegacyTexas Bank has agreed to offer a line ofcreditthat could support shortterm working capital needs for Monarch in relation to the Rise operations. The amountofthat line ofcredit is $1,050,000.00 and would matureone year afterthe line is granted and could be eligiblefor renewal atthattime. Monarch Air could have access tothe line ofcredit as long as it is making regular payments against any outstanding balance as detailed in paragraph 3 ofmy December 18, 2014 letter. To date, Monarch Air has not made any withdrawals againstthis line ofcredit facility. The second partofthefinancing is associated with the acquisition ofuptofivefuture aircraft acquisitions. Each future aircraft purchase will be a separate loan that will be secured bythe aircraft being purchased. The first aircraft has already been acquired (1/8/15) by N111RZ, LLC on behalfof Monarch Air. It is my understandingthat acopy ofthe promissory note containing the relevant loan terms has been providedtoyou by Monarch Air. Atthis point in time, it is impossible to determinetheterms ofany future loans. However, we provided some basic assumptions in paragraph 2 ofmy letter dated December 18, 2014. Please assume thatthe terms coveringthe recent aircraft purchase will similarly applytofuture aircraft loans, withthe variation allowed forthe purchase price, amortization schedule, and applicable interest rate. As a pointofclarification, the December 18, 20141etter provided an approximate monthly payment on the anticipated loan. The actual monthly paymentwould be subjecttothe applicable amortization schedule. Please let me know if Ican provide any further information on this matter. 

# 7}:-// # 'SteveYoun?-Y" 

# A
SeniorVice President

PO Box 869111 Plano, Tx 75086-9111 972.461.1300 Metro 972.562.5600 www.legacyTexas.com Member FDIC/tStEqual Housing lender 

# Exhibit2PROMISSORY NOTE $3,350,000.00

Note Number January 7, 2015 Effective Date January 7, 2025

Maturity Date
1. Definitions. As used in this Promissory Note, the following terms shall have the following meanings. "Bank" means LegacyTexas Bank, and its successors and assigns. "Borrower" means, whether one or more, N111RZ LLC, a Texas limited liability company. "Business Day" means a weekday, Monday through Friday, except a legal holiday or a day on which banking institutions in Dallas, Texas are authorized or required by law to be closed. Unless otherwise provided, theterm "days" when used herein shall mean calendar days. "Effective Date" means January 7, 2015. "Loan Agreement" means the Loan and Security Agreement, dated January 7, 2015, between Bank and Borrower as such may be amended, renewed, extended and replaced from time to time. "Loan Documents" means this Note, the Loan Agreement, and any and all other agreements, documents, and instruments executed and delivered in connection with this Note, and any future amendments thereto, or restatements thereof, together with any and all renewals, extensions, amendments and modifications to any such agreements, documents, and instruments. "Loan Rate" means (a) forthe period commencing on the Effective Date up though and Including January 6, 2020, a fixed rate equal to the 4-5 Year Standard Bullet Federal Home Loan Bank Rate plus three and one half percent (3.5%) in effect on January 6, 2015, and {b) for the period commencing on January 7, 2020, up though and including the Maturity Date, a fixed rate equal to the 4-5 Year Standard Bullet Federal Home Loan Bank Rate plus three percent (3.0%) in effect on January 6, 2020; provided, however, notwithstanding the amount of the Loan Rate in effect from time to time, the Loan Rate shall never be lowerthan five and one quarter percent (5.25%) per annum. "Maturity Date" means January 7, 2025. "Maximum Lawful

### B§tg" means the maximum lawful rate of interest which may be contracted for, charged, taken, received or reserved by Bank in accordance with the applicable laws of the State of Texas (or applicable United States federal law to the extent that such law permits Bank to contract for, charge, take, receive or reserve a greater amount of interestthan underTexas law). "Note" means this Promissory Note and all modifications, increases, replacements, renewals, and extensions ofthis Promissory Note. Any capitalized term used in this Note and not otherwise defined herein shall have the meaning ascribed to each such term in the Loan Agreement. All terms used herein, whether or not defined in this Note, and whether used in singular or plural form, shall be deemed to refer to the object of such term whether such is singular or plural In nature, as the context may suggest or require. 2. Promise to Pay. For value received, Borrower Oointly and severally if more than one), unconditionally hereby promises to pay to the order of Bank, at its place of business located at 3512 Preston Road, Plano, Texas 75093-7406, or at such other place as the holder ofthis Note may hereafter designate, the principal sum of Three Million Three Hundred Fifty Thousand and No/100 Dollars ($3,350,000.00) or so much thereofas may be advanced, in lawful money ofthe United States ofAmerica for the payment of private debts, together with interest on the unpaid principal balance from time to time W:\4104\2697\Note.doc Page 1


# Exhibit3owing hereon computed from the date hereof until maturity at a per annum rate which shall be, except as otherwise provided in this Note, the lesser of (a) the Loan Rate in effect from day to day, or (b) the Maximum Lawful Rate. Interest on this Note is computed on a 

### 365/360 simple interest basis; that is by applying the ratio of the annual interest over a year of 

### 360 days times the outstanding principal balance, times the actual number ofdays the principal balance is outstanding, unless such calculation would result in a usurious rate, in which case interest shall be calculated on 

### a per diem basis of a year of 365 or 366 days as the case may be. All past due principal and matured unpaid interest, at Bank's option, shall bear interest at the Maximum Lawful Rate, whether or not the maturity of the indebtedness evidenced by this Note has been accelerated. This Note is not subject to multiple advances and does not have a revolving credit feature. 

### 3. Interest Rate. The Loan Rate is subject to change as set forth in the definition of "Loan Rate." 4. Payments. This Note is payable as follows: A. Installments of principal each in the amount of Twenty Seven Thousand Nine

... ·-- --Hundred Sixteen--and--6'7/100 --Dollars-

### i$27;916:61)-plus--accrued--but- unpaid- interest on--the -unpaid---
--- principal balance hereof at the Loan Rate In effect on such payment date shall be due and payable monthly, with the first of such installments of principal plus accrued but unpaid interest being due on February 7, 

### 2015, and a like principal installment plus accrued but unpaid interest on the unpaid principal balance hereof shall 

### be due on the same day ofeach succeeding calendar month until the Maturity Date when the outstanding principal balance ofthis Note and any and all accrued but unpaid interest hereon shall be due and payable in full. Except as expressly provided herein or in the Loan Agreement (if applicable) to the contrary, all payments on this Note shall be applied in the following order of priority: (a) the paymentor reimbursement of any expenses, costs or obligations (other than the outstanding principal balance hereof and interest hereon) for which Borrower shall be obligated or Bank shall be entitled pursuant to the provisions of this Note or the other Loan Documents, (b) the payment of accrued blit unpaid Interest hereon, and (c) the payment of a11 or any portion of the principal balance hereof then outstanding hereunder. If an Event of Default exists under this Note, then Bank may, at the sole option of Bank, apply any such payments, at any time and from time to time, to any ofthe items specified In clauses (a), (b) or (c) above without regard to the order ofpriority otherwise specified in this Section 4 and any application to the outstanding principal balance hereof may be made in either direct or inverse order of maturity. Payments by check or draft shall not constitute payment in Immediately available funds until the required amount is actually received by Bank. Payments in immediately available funds received by Bank in the place designated for payment on a Business Day prior to 

### 11:00 a.m. Dallas, Texas time at said place of payment shall be credited prior to the close of business on the Business Day received, while payments received by Bank on a day other than a Business Day or after 

### 11:00 a.m. Dallas, Texas time on a Business Day shall not be credited until the next succeeding Business Day. Ifany payment of principal or interest on this Note shall become due and payable on a day other than a Business Day, such payment shall be made on the next succeeding Business Day. Acceptance by Bank of any payment in an amount less than the full amount then due shall be deemed an acceptance on account only, and the failure to pay the entire amount then due may become an Event of Default. Borrower agrees that all payments of any obligation due hereunder shall be final, and ifany such payment is recovered In any bankruptcy, insolvency orsimilar proceedings instituted by or against Borrower, all obligations due hereunder shall be automatically reinstated in respect of the obligation as to which payment is so recovered. 5. 

# Prepayment. Borrower may prepay this Note 

## iii 

## i)'artoriii fi:iii

## withoutpenalty before.ffnaf maturity, whether by cash, a new loan, renewal, or otherwise. Prepayment in full shall consist of payment of the remaining unpaid principal balance together with all accrued and unpaid interest and all other amounts, costs and expenses for which Borrower is responsible under this Note or any other agreement with Bank pertaining to this loan, and in no event will Borrower ever be required to pay any unearned interest. Early payments will not, unless agreed in writing, relieve Borrower of Borrower's obligation to continue to make payments under the above payment schedule. Upon a prepayment in full,. points, 

### if----

.. any, are not refundable except and to the extent the total interest and points for the time the loan is outstanding would exceed the maximum interest allowed by law atthe time of prepayment. W:\410412697\Note.doc Page 26. Waiver. Except as otherwise provided herein and In the other Loan Documents, Borrower hereby waives all notices of nonpayment, demands for payment, presentments for payment, notices 

### of intention to accelerate maturity, notices of actual acceleration of maturity, grace, protests, notices of protest, and any other demands or notices of any kind as to this Note, diligence in collection hereof and in bringing suit hereon, 

### and any notice 

### of, or defense 

### on account of, the extension oftlme of payments or change in the method ofpayments, and without further notice hereby consents to any and all renewals and extensions In the time of payment hereof either before or after maturity and the release of any party primarily or secondarily liable hereon. Borrower agrees that Bank's acceptance of partial or delinquent payments, or failure 

### of Bank to exercise any right or remedy contained herein or in any instrument given as security for the payment of this Note shall not be a waiver of any obligation of Borrower to Bank or constitute waiver of any similar default subsequently occurring. The holder 

### of this Note Is entitled to the benefits and security provided in the Loan Documents. 7. Events of Default and**Remedle~.** At the option of Bank, the entire unpaid principal balance and accrued interest owing hereon shall at once become due and payable upon the occurrence at any time ofany ofthe following "Events of Default" (herein so called):



### .. ··· -- --........------A----·-Thei'ailure-otBorrowerio·pay--(or-cause-to--be-paid)-when-due-any-installment-of-------

....._-·-

principal or interest of this Note in accordance with its terms, through acceleration, or otherwise; or B. An Event of Default occurs underany other Loan Document. It is understood and agreed by Borrower that the foregoing "Events of Default" are cumulative and in addition to any "Default," "Defaults," "Event of Default," or "Events of Default" contained In the other Loan Documents, or other documents modifying, renewing, extending, evidencing, securing or pertaining to this Note orthe loan evidenced hereby. Upon the occurrence ofany ofthe Events of Default, then the holder hereof may, at its option, do any one or more of the following: (a) declare the entire unpaid balance of principal and accrued, unpaid interest upon this Note to be Immediately due and payable, (b) reduce any claim to judgment, (c) foreclose all liens and security interests securing payment thereof or any part thereof, and/or (d) without notice of default or demand, pursue and enforce any 

### of Bank's other rights and remedies provided under or pursuant to any applicable laws or agreement. All rights and remedies of Bank shall be cumulative and concurrent and may be pursued singularly, successively, or together, at the sole discretion of Bank, and may be exercised as often as the occasion therefor shall arise and whether or not Bank has initiated any foreclosure proceeding, judicial or otherwise. Failure by Bank to exercise any right or remedy upon the occurrence of an Event of Default shall not constitute a waiver of the right to exercise such right or remedy upon the occurrence of any subsequent Event of Default. In the event that Bank, after the occurrence of an Event of Default hereunder, consults an attorney regarding the enforcement of any of its rights under this Note or if this Note Is placed in the hands ofan attorneyfor collection or ifsuit be brought to enforce this Note, Borrower promises to pay all costs thereof, Including reasonable attorneys' fees. Such costs and attorneys' fees shall include, without limitation, costs and reasonable attorneys' fees incurred by Bank in any appellate proceedings or in any proceedings under any present or future federal bankruptcy act, state receivership lawor probate. 8. Savings Clause; Ceiling Election. It is expressly stipulated and agreed to be the Intent of Borrower and Bank at all times to comply strictly with the applicable Texas law governing the maximum rate or amount of interest payable on the indebtedness evidenced by this Note and the Related Indebtedness (or applicable United States federal law to the extent that it permits Bank to contract for,



### _**_c::~~\9.~. t?~ke,**  resef\le or receive a greater amount of interest than underTexas law). Ifthe applicable law

is ever judicially interpreted so as to render usurious any amount (a) contracted for, charged, taken, reserved or received pursuantto this Note, any ofthe other Loan Documents orany other communication orwriting by or between Borrower and Bank related to the transaction ortransactions that are the subject matter of the Loan Documents, (b) contracted for, charged, taken, reserved or received by reason of Bank's exercise of the option to accelerate the maturity ofthis Note and/or any and all indebtedness paid or payable by Borrower to Bank pursuant to any Loan Document other than the Note (such other

...-.indebtedness.belng

..refer.red.to

..in

..this

..Section. as the**~~Related**..lndebtedQ§J?.§.'.').-or..(c)_Borr.ow.er....will hr;we paid or Bank will have received by reason ofany prepayment by Borrowerofthis Note and/orthe Related Indebtedness, then it is Borrower's and Bank's express intent that all amounts charged in excess of the Maximum Lawful Rate shall be automatically canceled, ab initio, and all amounts in excess of the W:\4104\2697\Note.doc Page 3Maximum Lawful Rate theretofore collected by Bank shall be credited on the principal balance of this Note and/or the Related Indebtedness (or, if this Note and the Related Indebtedness have been or would thereby be paid in full, refunded to Borrower), and the provisions of this Note and the other Loan Documents shall immediately be deemed reformed and the amounts thereafter collectible hereunder and thereunder reduced;- Withoot 

### the necessity of the execution of any new document; s·o as to comply with the applicable law, but so as to permit the recovery of the fullest amount otherwise called for hereunder and thereunder; provided, however, ifthis Note has been paid in full before the end ofthe stated term of this Note, then Borrower and Bank agree that Bank shall, with reasonable promptness after Bank discovers or Is advised by Borrower that interest was received In an amount In excess of the Maximum Lawful Rate, either refund such excess interestto Borrower and/or credit such excess interest againstthis Note then owing by Borrower to Bank. Borrower hereby agrees that as a condition precedent to any claim or counterclaim (In Which event such proceeding shall be abated for such time period) seeking usury penalties against Bank, Borrowerwill provide written notice to Bank, advising Bank in reasonable detail of the nature and amount ofthe violation, and Bank shall have sixty (60) days after receipt of such notice in which to correct such usury violation, If any, by either refunding such excess interest 

### to Borrower or crediting such excess interest against this Note then owing by Borrowerto Bank. All sums contracted for, charged, taken, reserved or received by Bank for the use, forbearance ordetention of any debt evidenced
-·--··-- --------by-this-Note---andtor---the-other--1:.-oan-BoetJments-shall;----to--the-extent---permitted-by--appfieable--law,-be-----------
- amortized or spread, using the actuarial method, throughout the stated term of this Note (Including any and 

### all renewal and extension periods) until payment in full so that the rate or amount of interest on account ofthis Note does not exceed the Maximum Lawful Rate from time to time 

### in effect and applicable to this Note for so long as debt is outstanding. In no event shall the provisions of Chapter 346 of the Texas Finance Code apply to this Note. To the extent that Bank is relying on Chapter 303 of the Texas Finance Code to determine the Maximum Lawful Rate payable on the Note, Bank will utilize the weekly ceiling from time to time in effect as provided in such Chapter 303, as amended. To the extent United States federal law permits Bank to contract for, charge, take, receive or reserve a greater amount of interest than underTexas law, Bank will rely on United States federal law instead of such Chapter 

### 303 for the purpose of determining the Maximum Lawful Rate. Additionally, 

### to the extent permitted by applicable law now or hereafter in effect, Bank may, at its option and from time to time, utilize any other method of establisliing 

### the Maximum 

### LaWful Rate under such Chapter 

### 303 or under' other applicable law by giving notice, ifrequired, to Borroweras provided by applicable law nowor hereafter in effect 9. GOVERNING LAW AND VENUE. THIS NOTE IS BEING EXECUTED AND DELIVERED, AND IS INTENDED TO BE PERFORMED, IN TARRANT COUNTY, TEXAS AND THE LAWS (EXCLUDING CHOICE OF LAW PROVISIONS) OF SUCH STATE SHALL GOVERN THE VALIDITY, CONSTRUCTION, ENFORCEMENT AND INTERPRETATION OF THIS NOTE, EXCEPT TO THE EXTENT FEDERAL LAWS OTHERWISE GOVERN THE VALIDITY, CONSTRUCTION, ENFORCEMENT AND INTERPRETATION OF ALL OR ANY PART OF THIS NOTE. ALL LEGAL ACTIONS RELATED TO THIS NOTE SHALL BE BROUGHT IN THE APPROPRIATE COURT OF LAW LOCATED IN TARRANT COUNTY, TEXAS, TO THE EXCLUSION OF ALL OTHER VENUES. 

### 10. WAIVER OF JURY TRIAL. BORROWER, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, HEREBY KNOWINGLY, INTENTIONALLY, IRREVOCABLY, UNCONDITIONALLY AND VOLUNTARILY, WITH AND UPON THE ADVICE OF COMPETENT COUNSEL, WAIVES, RELINQUISHES AND FOREVER FORGOES THE RIGHT TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING BASED UPON, ARISING OUT OF, OR IN ANY WAY RELATING TO THIS NOTE OR ANY CONDUCT, ACT OR OMISSION OF BANK OR BORROWER, OR ANY OF THEIR DIRECTORS, OFFICERS, PARTNERS, MEMBERS, EMPLOYEES, AGENTS OR ATTORNEYS, OR ANY OTHER PERSONS AFFILIATED WITH BANK OR BORROWER, IN EACH OF THE FOREGOING CASES,

. WHETHER SOUNDING IN CONTRACT, TORT OR OTHERWISE. , 

### 11. Miscellaneous. A. Notices or communications to be given under this Note shall be given to the respective parties in writing as set forth in the Loan Agreement. 

### B. Time Is ofthe essence forthis Note.

W:\410412697\Note.doc Page 4C. This Note may not be changed or terminated orally, but only by an agreement In writing signed 

### by the party against whom enforcement of any waiver, change, modification, termination or discharge is sought. 

### o: Tnis Note· is secured, 

### hi 

### part, by the Loan Agreement to Which refe·rence 

### Is hereby made for 

### a description of the collateral, the nature and extent ofthe security, and the rights of the Bank in respect thereof. E. This Note and all the covenants, promises and agreements contained herein shall be binding upon Borrower's successors, assigns, heirs and personal representatives and inure to the benefitof Bank's successors and assigns. 

### F. At the option of Bank, Borrower will pay Bank, on demand, (i) 

### a "late charge" equal to five percent (5%) ofthe amount of any installment on this Note when such installment is not paid within ten (10) days following the date such installment Is due, and (ii} a processing fee in the amount of $25.00 for each checkwhich is provided to Bank by Borrower in payment for an obligation owing to Bank under any Loan Document but is returned or dishonored for any reason, in order to 

### coverthe additional**-------expenses-tnvolvedinilandling-clefint~uent-andl'ettlmed·or-dishonored-payments:--------------··--·** G. If any provision of this Note or the application thereof to any person or circumstance shall, for any reason and to any extent, be Invalid or unenforceable, then neither the remainder of this Note nor the application of such provision to other persons or circumstances nor the other instruments referred to herein shall be affected thereby, but rather shall be enforced to the greatest extent permitted by applicable law.
Effective as ofthe Effective Date.

W:\410412697\Note.doc Page 5

## i iSecretary of State !P.O. 

### Box 13697 

### iAustin, TX 78711-3697 !FAX: 512/463-5709
I 

### [Filing Fee: $300 

## Certificate of Formation Limited Liability Company Filed in the Office ofthe Secretary of State ofTexas Filing#: 

### 802128147 01/02/2015 Document #: 

### 584963750002 Image Generated Electronically forWeb Filing

Article 

### 2- Registered Agent and Registered Office 

## ir'J\. The initial registeredagent is an organization (cannot be company named above) by the name of: OR**[~8.** 

### The initial regisiered-ageni-is-ari (ridividual resident ofthe staie whose

# name..is·s-efiorth.below: 

# ii\iame:

__.......................................**---·--~-----** 

# ............,.................- ...· ........................_ ..................,..·· ···---...........,.....................................,.............,................,......,...,.,.· ...,.........,.· · -···· jRay Sawtelle Jr 

# !c. The business address ofthe registerecf'agent and the regfsten3d office address is:

. 

# :streei-Adctre-ss:----·-----··---,.--·-·

--------· -· -····- ---·- --····-····--------------...... ----- · :Monarch Air 

## \4580 Claire Chennault Addison TX 

## 75001 Consent 

### of Registered Agent 

# ;r·A:

# A··c;opy-orttie

....

co·n-seili'0Ti-89i.si'erecfa9eilTi5a.ttached. · ................. -······· ···· · .... ····· · ......· ·· · ·· ··· ·········· ··· OR IWB. 

### The consent ofthe registeredagent is maintained bythe entity. Article 3 - 

### Governing Authority 

# iiA. The li-mit.eci liabilitycompany-is

# tobe managed by managers.. OR 

### The limited liability company will not have managers. Management ofthe company is reserved to the members. The names and addresses ofthe governing persons are set forth below:**~~~-~~~~~M~;;:;b·~·;··1·:·**

# ..Ray·---·-s-awteWe···-Jr····· ···· .......................-- ......**!ri1~:**

# · ·iVIana9ini)"iVfem"be·r·····**~dd;~~~-:-458tfcla'irectiennault** 

## Addison TX, usA 

## 75001**.~----** 

## ....**---~-** 

## ..-·--·---·..·-·-····--..--........._ ·-----..**--~--** 

## ..--·................A"itici.e

# ·4--:·Pu.rri'ose

.........................**_~**

# ............,........................................................................................· fftie-pullJose for-whicil

..Til·e-com.P'any·i·sor9anizea-Ts

.. tort'he.iransaciTori--of'anY'.ancTail.faWi'liTGlisii1€;s·s·tarwhTcil-limiteCi

.. :liability companies may be organized underthe Texas Business Organizations Code.

- - - Supplemental Provisions/Informationi[The attached addendum, if any, is incorporated herein by reference.]



### Organizer 

# [flle-·riame_a_n_Ci_aa<Iress··c;yitie-or9anizer_a.reset"fo.rth

..teiaw.··----·-····-·------·····---····-···-- ·----·-·-----·------------------------·----·-····, :Greg W. Carboy 901 Main Street, Suite 3900, Dallas, TX 75202 Effectiveness of Filing This document becomes effective when the document is filed by the secretary ofstate. OR 

# :i·s·.This documen{becomes-effective-at·a-iater date,w-hich 

# is not morethan nin-ety(9o) days

# tram the date of itsjsigning. The delayed effective date is: 

### Execution

-·---· -----·--·-**--------------~-------------·-··** ---
---- ------------ ·------ . -- ····-···-··· ··- -- .. --------------- 

### :The undersigned affirms that the person designated as registered agent has consented to the appointment. The ;undersigned signs this document subjectto the penalties imposed by law forthe submission ofa materially false or :fraudulent instrument and certifies under penalty of perjury that the undersigned is authorized underthe provisions of , ;1aw governing the entity to execute the filing instrument. 

# idre9·w.-cari>oy·---·--·------------------------·····-----------··--
--------------··-- "'"·····-=···=

..-=··""--=---=----=-

### =--=--=--=--=--·'=·--=··=-=--=·-·-=

..·=--·-=··-=··-=···-=····=--=·······=·--·=-·=-···=···---=·····=··-=·····=······;:;;-:: .....

=·--=···=···-=--=·-·=·····=··-=····=··=--··=··-=····=- ..=--=- ..-""··-=---=---==·=··--=--==·---=-·=·-···=·-··=

..···=······=·--·=········=··--··=--··=--··=·····=·····=-----=··· =--···=·· ·=--·=-----=·-=···=···=----·=--·=····=·.,: [Signature of Organizer

FILING OFFICE COPY

### Corporations Section P.O.Box 13697 Austin, Texas 78711-3697


# Office ofthe Secretary ofState

CERTIFICATE OFFILING OF 

# NlllRZLLC FileNumber: 802128147 

## NanditaBerry Secretary ofState



### The undersigned, as Secretary ofState ofTexas, hereby certifies that a Certificate ofFormation for the above named Domestic Limited Liability Company (LLC) has been received in this office and has been found to conform tothe applicable provisions oflaw. ACCORDINGLY, the undersigned, as Secretary of State, and by virtue ofthe authority vested in the secretaryby law, hereby issuesthis certificate evidencingfiling effective onthe date shownbelow. The issuance ofthis certificate does not authorize the use ofa name in this state in violation ofthe rights ofanother under the federal Trademark Act of 1946, the Texas trademark law, the Assumed Business or ProfessionalNarne Act, orthe commonlaw.

Dated: 01/02/2015 Effective: 01/02/2015

Phone: (512) 463-5555 Preparedby: BridgetMouton 

### Nandita Berry Secretary ofState

Come visitus on the internetathttp://www.sos.state. tx.

### us! 

### Fax: (512) 463-5709 Dial: 7-1-1 for Relay Services TID: 10306 Document: 584963750002

### Menagerie Enterprises, Inc. d.b.a. Monarch Air 4580 Claire Chennault Addison, Texas 75001 (972) 931-0345 AIRCRAFT DRY LEASE AGREEMENT 

### This Aircraft Dry Lease Agreement (this "Lease"}, effective as of the 8th day of January 2015 (the "Effective Date"), is entered into by and between N111 RZ LLC (the "Lessor") and Menagerie Enterprises, Inc. DBA Monarch Air (the "Lessee"). For purposes of this Lease, Lessor and Lessee are sometimes collectively referred to as the "Parties," and individually, a "Party." RECITALS WHEREAS, 

### Lessor is the registered owner ofan aircraft (the "Aircraft") described as follows: 1. Make: Beech 2. Model: King Air 350 3. Serial number: FL-402 WHEREAS, 

### Lessee provides charter operations under Lessee's Federal Aviation Regulation ("FAR") Part 135 operating certificate; WHEREAS, 

### Lessor has purchased the Aircraft solely for the purpose of leasing the Aircraft to Lessee for charter operations; WHEREAS, 

### Lessor desires that Lessee lease, operate, exercise ful! Operational Control (as defined below) and take exclusive possession ofthe Aircraft in accordance with the terms and conditions stated herein; WHEREAS, 

### Lessee agrees to lease, operate, exercise full Operational Control and take exclusive possession of the Aircraft under the terms and conditions stated herein; NOW, THEREFORE, 

### the Parties, for and in consideration of the rents, covenants and conditions contained herein, mutually agree as follows: AGREEMENT 

### 1. Lease of Aircraft; Transfer of Exclusive Possession and Control. 

### Lessor hereby leases the Aircraft to Lessee, and transfers exclusive possession, use and Operational Control of the Aircraft to Lessee during the Term (as defined below) of this Lease. Upon termination of this Lease, Lessee shall relinquish possession of the Aircraft and return the Aircraft to Lessor at Lessee's facility in the same condition as it was delivered to Lessee, less reasonable wear & 

### tear and Lessor shall have the right to have the Aircraft inspected at Lessor's expense. 2. Operational Control of Aircraft. 

### Lessee shall maintain control and authority over the initiation, continuation, conduct, and termination of all flights and other operations of the Aircraft during the Term, and shall maintain exclusive possession, control, and use of the Aircraft and the pilots and crew thereon ("Operational Control") at all times during the Term. All flights shall be dispatched and monitored from Lessee's dispatch and operations division located at Addison Airport. All Aircraft operations shall be conducted in accordance with the Lessee FAA approved Air Carrier General Operations Manual and Operations Specifications and all other applicable laws, rules, regulations and specifications. By granting Operational Control to Lessee, Lessor hereby relinquishes and grants to Lessee each and every right Lessor may have to control, direct, instruct or in any way influence the manner of performance of any and all Aircraft flight operations, including any control offlight crew members on the Aircraft. 3. Term. 

### The initial term (the "Initial Term") of this Lease shall commence on the Effective Date and shall continue for a period of one (1) year. Following the Initial Term, this Lease shall automatically renew for successive



### Aircraft Dry Lease Agreement- Page I Final

### Menagerie Enterprises, Inc. d.b.a. Monarch Air 4580 Claire Chennault Addison, Texas 75001 (972) 931-0345
one year terms (each a "Renewal Term") until such time as either Party provides the other Party with written notice of termination; provided, however, that: (a) such notice must be given no fewer than forty-five (45) calendar days prior to the last day of the then current term; and (b) any such termination shall be effective as of the date that would have been the first day of the next Renewal Term. In addition, Lessee shall have the right to terminate this Lease without penalty or fee upon thirty days' written notice if Lessee sells, trades or otherwise no longer owns the Aircraft. For purposes of this Lease, "Term" shall collectively mean and include the Lease periods represented by the Initial Term and all Renewal Terms. 4. Lease Payments. In consideration of this Lease, Lessee agrees to make lease payments to Lessor (each, a "Lease Payment") the amount of thirty eight thousand, one hundred and fifty dollars and no cents ($38,150.00.00) upon execution ofthis agreement and on the first day of each month thereafter during the Term ofthis agreement. 5. Obligations 

### of Lessee:
a. Aircraft Inspection. Lessee agrees to inspect the Aircraft as required under FAA regulations to ensure the Aircraft's continued conformity with FAA Part 135 requirements. The Lessee shall bear the cost for the FAA Part 135 required conformity inspection for operations unless this Lease is terminated within 180 days from receipt of the FAA aircraft approval documentation (Operations Specifications 0085). In such event, Lessor shall pay to lessee a $4,000 fee to coverthe costs of such inspection. b. Aircraft Maintenance. lessee will determine what, if any, modifications or maintenance is required with respect to the Aircraft in order to comply with applicable Federal Aviation Administration (the "FAA") regulations.
c. Insurance. Lessee shall secure and maintain insurance coverage for the Aircraft pursuant to lessee's existing fleet hull policy of aircraft !lull insurance and liability in such amounts, deductibles and terms reasonably acceptable to lessor at lessor's expense. Lessor will be named as an additional insured on with respect to all insurance policies secured with respect to the Aircraft. Lessor will be provided with a Certificate of Insurance describing limits ofthe policy.
6. Obligations 

### of Lessor:
a. Delivery. Lessor shall deliver the aircraft to Lessee at lessee's facility at Addison Airport, Texas with a valid airworthiness certificate and all current maintenance records and free of all materialman's liens and/or encumbrances. b.**Qul~1.f._QjQY.QJ~n!.** 

### Lessor agrees that it will not interfere with lessee's use and possession of the aircraft and agrees to defend, at lessor's expense, Lessee's rights to possess and operate the aircraft pursuant to the terms ofthis Lease. 7. Taxes. Lessor shall pay all Taxes on the Aircraft when due. In the event that Lessor fails to timely pay a Tax, Lessee may, at its option, pay such Tax on behalf of Lessee and seek reimbursement from Lessor. For purposes of this Lease, "Taxes" means license, documentation and registration fees and any sales and property, excise, stamp and value added taxes together with any assessments, penalties, fines, additions to tax and interest thereon (each, individually, a "Tax").
8. Remedies. Upon a breach of a representation or obligation hereunder (each an "Event of Default"), the Parties shall have the following remedies:



### Aircraft Dry Lease Agreement- Page 2 Final .·· I

..... '" !.·· 

### LESSOH

# INITIAL~~··:?/::>{/ LESSEE

# INITIAL~

### Menagerie Enterprises, Inc. d.b.a. Monarch Air 4580 Claire Chennault Addison, Texas 75001 (972) 931-0345
a. Lessee's Remedies: Upon any Event of Default, Lessee may, at Lessee 's option and in addition to all other rights, remedies and recourses afforded Lessee hereunder or by contract, law or equity, do any one or more ofthe following (i) terminate this Lease by the giving of written notice to Lessor, or (ii) withhold any payments due to Lessor until such event of default is remedied. In any legal proceeding arising from this Lease, Lessee shall be entitled to recover reasonable attorney's fees and legal disbursements in addition to all available relief. b. Lessor's Remedies: Upon a material Event of Default by Lessee, Lessor shall have all rights and remedies available by contract, law or equity including, without limitation, the right to retake immediate possession of the Aircraft. In any legal proceeding arising from this Lease, Lessor shall be entitled to recover reasonable attorney's fees and legal disbursements in addition to all available relief. 9. 

### Further Acts. The Parties to this Lease shall, from time to time, do and perform such other and further acts, and execute and deliver any and all such other and further instruments as may be required by law or reasonably requested by the other to estab!isl1, maintain and protect tt1e respective rights and remedies of the other, and to carry out and effect the intents and purposes of this Lease. 10. 

### Notices. All notices to be given hereunder shall be in writing and may be sent by certified mail, return receipt requested to the address listed below and shall be deemed to be received three business days after depositing same in the United States mail, postage paid, or such notices may be transmitted by facsimile to the Parties at their respective telephone numbers shown below and shall be deemed received when so transmitted. To Lessor:

To Lessee: N111RZ,LLC 4580 Claire Chennault Addison, Texas 750013900 Menagerie Enterprises DBA Monarch Air 4580 Claire Chennault Addison, Texas 75001 Telephone: (972} 931-0345 Fax: (972} 692-7927 11. 

### Binding Effect. This Lease and all of the provisions hereof shall be binding upon and shall insure to the benefit of the Parties hereto and their respective heirs, distributees, legal representatives, successors and assigns. 12. 

### Amendment. This Lease may be modified, altered and amended from time to time by mutual written agreement ofthe Parties, but not otherwise. 13. Governing Law. This Lease shall be interpreted and governed by the laws of the State of Texas applicable to contracts made and to be performed therein without giving effect to the conflict of laws principles thereof. In any legal action relating to this Lease, both Parties agree to the exercise ofjurisdiction over it by a State or Federal court in Dallas County, Texas. Such action shall be instituted in a State or Federal court in Collin County, Texas. 14. Severability. In case any one or more ofthe provisions contained in this Lease shall for any reason be held to be invalid, illegal or unenforceable in any respect, such invalidity, illegality or unenforceability shall not affect any other provision thereof, and this Lease shall be construed as if such invalid, illegal or unenforceable provision had never been contained herein. 15. 

### Counterpart Execution. This Lease rnay be executed concurrently in one or more counterparts, each of which shall be deemed an original, but all ofwhich together shall constitute one and the same instrument.

Aircraft 

### Dry Lease Agreement- Page 3 Final _.·· ....... 'I/ ,. ,· 

### LfSSOR

# INITIAL~/ LESSEE INITIALS

### Menagerie Enterprises, Inc. d.b.a. Monarch Air 4580 Claire Chennault Addison, Texas 75001 (972) 931-0345 16. Assignment of Lease. This Lease shall be assignable by Lessee or Lessor in its entirety to any entity to which Lessee or Lessor may transfer all or substantially all of its assets and business pursuant to a merger, acquisition, or other such reorganization. Notwithstanding the preceding sentence, no assignment shall be valid unless: (i) such assignee is a citizen of the United States (as defined by 49 U.SC. §40102) or otherwise eligible to register Aircraft pursuant to Part 47 of the FAR, and (ii) in the case of an assignment 

### by Lessee, such assignment is approved by the FAA and DOT as an on-demand FAR 135 Air Carrier and such assignee shall execute all other documents necessary to reflect such assignee's assumption of this Lease. Any such assignment shall not operate to relieve the assignor of any liability accrued prior to such assignment. 17. Risk of Loss. Lessor agrees to assume all risk of loss of the Aircraft until the Aircraft is delivered to Lessee. Thereafter, Lessee agrees to assume risk of loss of the Aircraft to the extent of the Aircraft's insured value until this lease terminates, subject to the disclaimers and limitations set forth in Paragraph 20. 18. Indemnification. Each Party agrees to indemnify and hold harmless the other Party, its directors, managers, officers, agents, employees and the like from and against any and all loss, costs, damages, injuries or expenses (including attorneys fees and expenses) that may be incurred by a Party arising from the breach of any representations or obligations by the breaching Party, whether caused by the sole, comparative and concurrent negligence ofthe breaching Party. Each Party further agrees to indemnify and hold harmless the other Party against any loss sustained or reasonable expense (including attorneys fees and expenses) incurred by the other Party as the direct result of or arising out of the imposition on the Aircraft of any Federal or other tax lien or the foreclosure thereof by virtue of the failure to pay or the underpayment by the indemnifying Party of Federal or other taxes payable by the indemnifying Party. IT IS SPECIFICALLY AGREED AND UNDERSTOOD THAT EACH PARTY'S INDEMNIFICATION OBLIGATION DOES NOT EXTEND TO (I) INDIRECT, SPECIAL OR CONSEQUENTIAL DAMAGES SUFFERED BY THE OTHER PARTY, OR (I!) CONSEQUENTIAL LOSSES, COSTS, DAMAGES, INJURIES OR EXPENSES ARISING OUT OF THE OTHER PARTY'S GROSS NEGLIGENCE OR WILLFUL MISCONDUCT.
19. DISCLAIMER OF WARRANTIES & 

### LIMITATIONS ON RECOVERY 

### (a) Lessee disclaims all warranties, express or implied, with respect to any products, parts, and components that Lessee may install on the Aircraft and with respect the maintenance Lessee performs to the Aircraft during the period the Aircraft is in Lessee's Operational Control and all such products, parts and components shall remain with the Aircraft during and after the Term. The Parties further agree that Lessor bears all risk of loss for the aircraft beyond the Aircraft's insured value, including physical damage, consequential damages arising from loss of use ofthe Aircraft and diminution in the Aircraft's value, while Lessee is in Operational Control of the Aircraft. (b) LESSOR MAKES NO WARRANTIES OR REPRESENTATIONS WHATSOEVER REGARDING THE AIRCRAFT. ALL IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS FOR ANY INTENDED OR PARTICULAR PURPOSE, QUALITY, DESIGN, CONDITION, CAPACITY, SUITABILITY OR PERFORMANCE AND THOSE ARISING FROM A COURSE OF DEALING OR USAGE IN THE TRADE ARE COMPLETELY EXCLUDED AND HEREBY DISCLAIMED. NO EMPLOYEE, AGENT OR REPRESENTATIVE OF LESSOR IS AUTHORIZED TO MAKE ANY WARRANTY OR REPRESENTATION IN EXTENSION OF OR CONTRARY TO THE PROVISIONS OF THIS AGREEMENT;

Aircraft Dry Lease Agreement- Page 4 Final . / • f /·· 

### LESSOR INITIALS./ 

# /f-(.f LESSEE

# INITIA~

### Menagerie Enterprises, Inc. d.b.a. Monarch Air 4580 Claire Chennault Addison, Texas 75001 (972) 931-0345

# hi;~ 

# MONARCH 

# AIR**~** Whore You & Your Business Take Flight!


### (c) In no event shall Lessee be entitled to recover any incidental or consequential damages, including, without limitation, inconvenience, rental or replacement equipment lost profits or other commercial loss. 20. No Agency. The Parties' sole relationship is Lessor/Lessee. Neither Party shall enter into any agreements, made representations, incurany liability or act as the agent ofthe other Party.

IN WITNESS WHEREOF, the Parties hereto have caused this Lease to 

### be executed effective 

### as of the Effective Date.



### LESSOR N111RZ LLC



### LESSEE Menagerie Enterprise, Inc. 

### DBA Monarch Air

Aircraft 

### Dry Lease Agreement- P»ge 5 Final 

### ------------=SSOR

# INITIA~'­ LESSEE INITIAL'

### Balance Sheet Month 

### 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 

### 11 ASSETS CurrentAssets Cash 364,070.63 309,291.54 299,202.72 441,947.14 445,435.33 440,304.47 558,864.86 517,577.58 525,798.32. 527,703.71 529,629.02 Accounts Receivable 551,182.28 551,182.28 551'182.28 551,182.28 551,182.28 551,182.28 551,182.28 551,182.28 551,182.28 551,182.28 551,182.28

Loans to Employees 8,200.00 8,200.00 8,200.00 8,200.00 8,200.00 8,200.00 8,200.00 8,200.00 8,200.00 8,200.00 8,200.00 Fuel CreditRefunds Receivable 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 Inventories 423,787.76 423,787.76 423,787.76 423,787.76 423,787.76 423,787.76 423,787.76 423,787.76 423,787.76 423,787.76 423,787.76 Prepaid Insurance 5,277.08 5,277.08 5,277.08 5,277.08 5,277.08 5,277.08 5,277.08 5,277.08 5,277.08 5,277.08 5,277.08
Total CurrentAssets 1,352,517.75 1,297,738.66 1,287,649.84 1,430,394.26 1,433,882.45 1,428,751.59 1,547,311.98 1,506,024.70 1,514,245.44 1,516,150.83 1,518,076.14
Fixed Assets Machinery & Equipment 70,139.20 70,139.20 70,139.20 70,139.20 70,139.20 70,139.20 70,139.20 70,139.20 70,139.20 70,139.20 70,139.20 Aicraft & AircraftEquipment 616,825.94 616,825.94 616,825.94 616,825.94 616,825.94 616,825.94 616,825.94 616,825.94 616,825.94 616,825.94 616,825.94 RiseAircraft2 0.00 0.00 0.00 2,500,000.00 2,500,000.00 2,500,000.00 2,500,000.00 2,500,000.00 2,500,000.00 2,500,000.00 2,500,000.00 Rise Aircraft 3 0.00 0.00 0.00 0.00 0.00 0.00 2,500,000.00 2,500,000.00 2,500,000.00 2,500,000.00 2,500,000.00 Furniture & Fixtures 48,845.47 48,845.47 48,845.47 48,845.47 48,845.47 48,845.47 48,845.47 48,845.47 48,845.47 48,845.47 48,845.47 ComputerEquipment 54,616.46 54,616.46 54,616.46 54,616.46 54,616.46 54,616.46 54,616.46 54,616.46 54,616.46 54,616.46 54,616.46 Leasehold Improvements 90,743.70 90,743.70 90,743.70 90,743.70 90,743.70 90,743.70 90,743.70 90,743.70 90,743.70 90,743.70 90,743.70 Accumulated Depreciation -725,371.67 -729,538.34 -733,705.01 -757,705.01 -781,705.01 -805,705.01 -859,455.01 -913,205.01 -966,955.01 -1,020,705.01 -1,074,455.01
Total Fixed Assets 155,799.10 151,632.43 147,465.76 2,623,465.76 2,599,465.76 2,575,465.76 5,021,715.76 4,967,965.76 4,914,215.76 4,860,465.76 4,806,715.76
OtherAssets Aircraft Insurance Deposit 14,134.64 14,134.64 14,134.64 14,134.64 14,134.64 14,134.64 14,134.64 14,134.64 14,134.64 14,134.64 14,134.64

Aircraft Escrow Deposits 57,491.63 57,491.63 57,491.63 57,491.63 57,491.63 57,491.63 57,491.63 57,491.63 57,491.63 57,491.63 57,491.63 Aircraft Purchase Deposits 15,000.00 15,000.00 15,000.00 15,000.00 15,000.00 15,000.00 15,000.00 15,000.00 15,000.00 15,000.00 15,000.00 COD Checks Outstanding 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,00_0.00 1,000.00 1,000.00 1,000.00 1,000.00 Deposits 15,565.00 15,565.00 15,565.00 15,565.00 15,565.00 15,565.00 15,565.00 15,565.00 15,565.00 15,565.00 15,565.00 Gift Certificates Outstanding 149.00 149.00 149.00 149.00 149.00 149.00 149.00 149.00 149.00 149.00 149.00

.. 

## - Total OtherAssets 103,340.27 103,340.27 103,340.27 103,340.27 103,340.27 103,340.27 103,340.27 103,340.27 103,340.27 103,340.27 103,340.27


### TOTALASSETS 1,611,657.12 1,552,711.36L__!_,5_38,455.87 4,157,200.29 4,136,688.48 4,107,557.62 6,672,368.01 6,577,330.73 6,531,801.47 6,479,956.86 6,428,132.17

-- 

# Exhibit 5LIABILITIES AND EQUITY
Accounts Payable 874,696.83 874,696.83 874,696.83 874,696.83 874,696.83 874,696.83 874,696.83 816,678.06 816,678.06 810,560.58 804,792.20 

### NIP -LegacyTexas Bank 643,644.64 630,889.15 617,788.80 604,909.61 591,878.19 578,875.02 565,723.04 552,594.70 539,403.53 526,068.74 512,750.62 LOC

- Legacy Texas Bank 297,000.00 297,000.00 297,000.00 297,000.00 297,000.00 297,000.00 297,000.00 297,000.00 297,000.00 297,000.00 297,000.00 LOC- Legacy Texas Bank (Rise) 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 Loans from Shareholder 50,000.00 50,000.00 50,000.00 50,000.00 50,000.00 50,000.00 50,000.00 50,000.00 50,000.00 50,000.00 50,000.00 Payroll Tax Liability 0.06 0.06 0."06 0.06 0.06 0.06 0.06 0.06 0.06 0.06 0.06 LOC-BB&T 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 Sales TaxPayable 18,142.56 18,142.56 18,142.56 18,142.56 18,142.56 18,142.56 18,142.56 18,142.56 18,142.56 18,142.56 18,142.56I Total CurrentLiabilities 1,883,484.09 1,870,728.60 1,857,628.25 1,844,749.06 1,831,717.64 1,818,714.47 1,805,562.49 1,734,415.38 1,721,224.21 1,701,771.94 1,682,685.44
OtherLiabilities 

### NIP Rise Aircraft 2 2,500,000.00 2,483,900.29 2,467,733.49 2,451,499.33 2,435,197.53 2,418,827.81 2,402,389.88 2,385,833.46 

### NIP Rise Aircraft 3 2,500,000.00 2,483,900.26 2,467,733.49 2,451,499.33 2,435,197.53 Loan

- TreyAviation, Inc 14,900.00 14,900.00 14,900.00 14,900.00 14,900.00 14,900.00 14,900.00 14,900.00 14,900.00 14,900.00 14,900.00 Loan

- TreyAviation LLC 49,600.00 49,600.00 49,600.00 49,600.00 49,600.00 49,600.00 49,600.00 49,600.00 49,600.00 49,600.00 49,600.00 Refundable Insurance Deposits 16,923.36 16,923.36 16,923.36 16,923.36 16,923.36 16,923.36 16,923.36 16,923.36 16,923.36 16,923.36 16,923.36
Total OtherLiabilities 81,423.36 81,423.36 81,423.36 2,581,423.36 2,565,323.65 2,549,156.85 5,032,922.69 5,000,521.15 4,967,984.66 4,935,312.57 4,902,454.35 Equity Capital Stock 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 Additional Paid In Capital 3,894.67 3,894.67 3,894.67 3,894.67 3,894.67 3,894.67 3,894.67 3,894.67 3,894.67 3,894.67 3,894.67 Retained Earnings -544,113.87 -544,113.87 -544,113.87 -544,113.87 -544,113.87 -544,113.87 -544,113.87 -544,113.87 -544,113.87 -544,113.87 -544,113.87 Revenues Over (Under) Expenses 185,968.87 139,778.60 138,623.46 270,247.07 278,866.39 278,905.50 373,102.03 381,613.40 381,811.80 382,091.55 382,211.58
Total Equity -353,250.33 -399,440.60 -400,595.74 -268,972.13 -260,352.81 -260,313.70 -166,117.17 -157,605.80 -157,407.40 -157,127.65 -157,007.62
TOTAL LIABILITIES & .. EQUITY 1,611,657.12 1,552,711.36 1,538,455.87 4,157,200.29 4,136,688.48 4,107,557.62 6,672,368.01 6,577,330.73 6,531,801.47 6,479,956.86 6,428,132.17 

## *Therewill be considerable amount ofcash buildup thatwill be usedto pay down the LOC

- Legacy Texas Bankliablity acccount. This is not currentlyreflected onthe balance sheet as the exacttime ofthis has yetto be determined.

### Balance Sheet- Non-Rise Operations Month I Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month II Month 12 

### ASSETS CurrentAssets Cash 216,278.38 207,183.29 198,594.47 189,660.79 180,948.27 172,083.52 163,247.02 96,242.94 87,281.27 72,129.29 57,202.79 9,574.70 Accounts Receivable 551,182.28 551,182.28 551,182.28 551,182.28 551,182.28 551,182.28 551,182.28 551,182.28 551,182.28 551,182.28 551,182.28 551,182.28

Loans to Employees 8,200.00 8,200.00 8,200.00 8,200.00 8,200.00 8,200.00 8,200.00 8,200.00 8,200.00 8,200.00 8,200.00 8,200.00 Fuel CreditRefunds Receivable 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 130,000.00 Inventories 423,787.76 423,787.76 423,787.76 423,787.76 423,787.76 423,787.76 423,787.76 423,787.76 423,787.76 423,787.76 423,787.76 423,787.76 Prepaid Insurance 5,277.08 5,277.08 5,277.08 5,277.08 5,277.08 5,277.08 5,277.08 5,277.08 5,277.08 5,277.08 5,277.08 5,277.08
Total CurrentAssets 1,204,725.50 1,195,630.41 1,187,041.59 1,178,107.91 1,169,395.39 I,160,530.64 1,151,694.14 I,084,690.06 1,075,728.39 I,060,576.41 1,045,649.91 I,128,021.82
FixedAssets Machinery & Equipment 70,139.20 70,139.20 70,139.20 70,139.20 70,139.20 70,139.20 70,139.20 70,139.20 70,139.20 70,139.20 70,139.20 70,139.20 Aicraft & AircraftEquipment 616,825.94 616,825.94 616,825.94 616,825.94 616,825.94 616,825.94 616,825.94 616,825.94 616,825.94 616,825.94 616,825.94 616,825.94 Furniture & Fixtures 48,845.47 48,845.47 48,845.47 48,845.47 48,845.47 48,845.47 48,845.47 48,845.47 48,845.47 48,845.47 48,845.47 48,845.47 ComputerEquipment 54,616.46 54,616.46 54,616.46 54,616.46 54,616.46 54,616.46 54,616.46 54,616.46 54,616.46 54,616.46 54,616.46 54,616.46 Leasehold Improvements 90,743.70 90,743.70 90,743.70 90,743.70 90,743.70 90,743.70 90,743.70 90,743.70 90,743.70 90,743.70 90,743.70 90,743.70 Accumulated Depreciation -725,371.67 -729,538.34 -733,705.01 -737,871.68 -742,038.35 -746,205.02 -750,371.69 -754,538.36 -758,705.03 -762,871.70 -767,038.37 -771,205.04
Total FixedAssets 155,799.10 151,632.43 147,465.76 143,299.09 139,132.42 134,965.75 130,799.08 126,632.41 122,465.74 118,299.07 114,132.40 109,965.73
OtherAssets Aircraft Insurance Deposit 14,134.64 14,134.64 14,134.64 14,134.64 14,134.64 14,134.64 14,134.64 14,134.64 14,134.64 14,134.64 14,134.64 14,134.64

AircraftEscrow Deposits 57,491.63 57,491.63 57,491.63 57,491.63 57,491.63 57,491.63 57,491.63 57,491.63 57,491.63 57,491.63 57,491.63 57,491.63 AircraftPurchaseDeposits 15,000.00 15,000.00 15,000.00 15,000.00 15,000.00 15,000.00 15,000.00 15,000.00 15,000.00 15,000.00 15,000.00 15,000.00 COD Checks Outstanding 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 Deposits 15,565.00 15,565.00 15,565.00 15,565.00 15,565.00 15,565.00 15,565.00 15,565.00 15,565.00 15,565.00 15,565.00 15,565.00 Gift Certificates Outstanding 149.00 149.00 149.00 149.00 149.00 149.00 149.00 149.00 149.00 149.00 149.00 149.00
Total OtherAssets 103,340.27 I03,340.27 103,340.27 103,340.27 103,340.27 103,340.27 I03,340.27 I03,340.27 I03,340.27 I03,340.27 103,340.27 I03,340.27


### TOTAL

### ASSETS 1,463,864.87 I,450,603.11 1,437,847.62 1,424,747.27 I,411,868.08 1,398,836.66 1,385,833.49 1,314,662.74 1,301,534.40 1,282,215.75 1,263,122.58 1,341,327.82

-,I

I, LIABILITIESAND EQUITY
AccountsPayable 

### NIP- Legacy Texas Bank LOC- Legacy Texas Bank

Loans from Shareholder Payroll TaxLiability LOC-BB&T Sales Tax Payable
Total CurrentLiabilities
OtherLiabilities Loan

- TreyAviation, Inc Loan

- TreyAviationLLC Refundable Insurance Deposits
Total OtherLiabilities Equity Capital Stock Additional Paid In Capital Retained Earnings Revenues Over (Under) Expenses
Total Equity
TOTAL LIABILITIES 

### & EQUITY

-- 874,696.83 874,696.83 643,644.64 630,889.15 297,000.00 297,000.00

50,000.00 50,000.00 0.06 0.06 0.00 0.00 I8,I42.56 I8,I42.56
I,883,484.09 1,870,728.60

I4,900.00 14,900.00 49,600.00 49,600.00 16,923.36 16,923.36 81,423.36 81,423.36

1,000.00 1,000.00 3,894.67 3,894.67 -544,113.87 -544,113.87

38,176.62 37,670.35 -501,042.58 -501,548.85

I,463,864.87 1,450,603.I1 874,696.83 874,696.83 874,696.83 617,788.80 604,909.61 591,878.I9 297,000.00 297,000.00 297,000.00

50,000.00 50,000.00 50,000.00 0.06 0.06 0.06 0.00 0.00 0.00 I8,I42.56 I8,I42.56 I8,I42.56 I,857,628.25 I,844,749.06 I,83I,7I7.64

14,900.00 14,900.00 14,900.00 49,600.00 49,600.00 49,600.00 16,923.36 16,923.36 16,923.36 81,423.36 81,423.36 81,423.36

1,000.00 1,000.00 1,000.00 3,894.67 3,894.67 3,894.67 -544,113.87 -544,113.87 -544,113.87

38,015.21 37,794.05 37,946.28 -501,203.99 -501,425.15 -501,272.92
1,437,847.62 1,424,747.27 1,41 I,868.08

.. 874,696.83 874,696.83 8I6,678.06 816,678.06 810,560.58 804,792.20 766,3I5.56 578,875.02 565,723.04 552,594.70 539,403.53 526,068.74 512,750.62 499,292.37 297,000.00 297,000.00 297,000.00 297,000.00 297,000.00 297,000.00 297,000.00

50,000.00 50,000.00 50,000.00 50,000.00 50,000.00 50,000.00 50,000.00 0.06 0.06 0.06 0.06 0.06 0.06 0.06 0.00 0.00 0.00 0.00 0.00 0.00 0.00 I8,I42.56 I8,I42.56 I8,I42.56 I8,I42.56 I8,I42.56 I8,I42.56 I8,I42.56 I,8I8,714.47 I,805,562.49 I,734,4I5.38 I,72I,224.2I I,701,771.94 I,682,685.44 I,630,750.55

14,900.00 14,900.00 14,900.00 14,900.00 14,900.00 14,900.00 14,900.00 49,600.00 49,600.00 49,600.00 49,600.00 49,600.00 49,600.00 49,600.00 16,923.36 16,923.36 16,923.36 16,923.36 16,923.36 16,923.36 16,923.36 81,423.36 81,423.36 81,423.36 81,423.36 81,423.36 8I,423.36 81,423.36

1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 1,000.00 3,894.67 3,894.67 3,894.67 3,894.67 3,894.67 3,894.67 3,894.67 -544,113.87 -544,113.87 -544,113.87 -544,113.87 -544,113.87 -544,113.87 -544,113.87

37,918.03 38,066.84 38,043.20 38,106.03 38,239.65 38,232.98 168,373.11 -501,301.17 -501 '152.36 -501'176.00 -501,113.17 -500,979.55 -500,986.22 -370,846.09

I,398,836.66 1,385,833.49 1,314,662.74 1,30I,534.40 1,282,215.75 1,263,122.58 1,341,327.82

### Balance Sheet- Rise Operations Month 1 Month 2 Month 3 Month4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12 

### ASSETS CurrentAssets Cash 147,792.25 102,108.25 100,608.25 252,286.35 264,487.06 268,220.95 395,617.84 421,334.64 438,517.05 455,564.42 472,426.23 444,980.49 Fuel Tax CreditReceivable 147,571.40 Total CurrentAssets 147,792.25 102,108.25 100,608.25 252,286.35 264,487.06 268,220.95 395,617.84 421,334.64 438,517.05 455,564.42 472,426.23 592,551.89
FixedAssets

. RiseAircraft2 0.00 0.00 0.00 2,500,000.00 2,500,000.00 2,500,000.00 2,500,000.00 2,500,000.00 2,500,000.00 2,500,000.00 2,500,000.00 2,500,000.00 RiseAircraft 3 0.00 0.00 0.00 0.00 0.00 0.00 2,500,000.00 2,500,000.00 2,500,000.00 2,500,000.00 2,500,000.00 2,500,000.00 Accumulated Depreciation 0.00 0.00 0.00 -19,833.33 -39,666.66 -59,499.99 -109,083.32 -158,666.65 -208,249.98 -257,833.31 -307,416.64 -356,999.97
Total Fixed Assets 0.00 0.00 0.00 2,480,166.67 2,460,333.34 2,440,500.01 4,890,916.68 4,841,333.35 4,791,750.02 4,742,166.69 4,692,583.36 4,643,000.03
OtherAssets
Total OtherAssets 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00


### TOTALASSETS 147,792.25 102,108.25 100,608.25 2,732,453.02 2,724,820.40 2,708,720.96 5,286,534.52 5,262,667.99 5,230,267.07 5,197,731.11 5,165,009.59 5,235,551.92



### LIABILITIESAND EQUITY
LOC- Legacy Texas Bank (Rise) 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Total CurrentLiabilities 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
OtherLiabilities 

### NIP Rise Aircraft 2 2,500,000.00 2,483,900.29 2,467,733.49 2,451,499.33 2,435,197.53 2,418,827.81 2,402,389.88 2,385,833.46 2,369,308.26 

### NIP Rise Aircraft 3 .. 2,500,000.00 2,483,900.26 2,467,733.49 2,451,499.33 2,435,197.53 2,418,827.81
Total OtherLiabilities 0.00 0.00 0.00 ·2,500,000.00 2,483,900.29 2,467,733.49 4,951,499.33 4,919,097.79 4,886,561.30 4,853,889.21 4,821,030.99• 4,788,136.07

-· --- -- ---! Equity Capital Stock

. 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 Additional Paid In Capital 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 Retained Earnings 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 Revenues Over (Under) Expenses 147,792.25 102,108.25 100,608.25 232,453.02 240,920.11 240,987.47 335,035.19 343,570.20 343,705.77 343,841.90 343,978.60 447,415.85
Total Equity 147,792.25 102,108.25 100,608.25 232,453.02 240,920.11 240,987.47 335,035.19 343,570.20 343,705.77 343,841.90 343,978.60 447,415.85
TOTAL LIABILITIES & 147,792.25 102,108.25 100,608.25 2,732,453.02 2,724,820.40 2,708,720.96 5,286,534.52 5,262,667.99 5,230,267.07 5,197,731.11 5,165,009.59 5,235,551.92 EQUITY

i

00

- -- _L

--- - L__

### ProjectedRevenues and Expenses Month 1 Month 2 Month 3 Month4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12 REVENUES Non-Rise Feerevenue 550,000.00 550,000.00 550,000.00 550,000.00 550,000.00 550,000.00 550,000.00 550,000.00 550,000.00 550,000.00 550,000.00 550,000.00 Rise revenue- Aircraft lDAL , HOU 368,964.33 368,964.33 368,964.33 368,964.33 368,964.3, 368,964.33 368,964.33 368,964.33 368,964.33 368,964.33 368,964.33 368,964.33 Rise revenue- Aircraft 2 DAL HOU 372,592.67 372,592.67 372,592.67 372,592.67 372,592.67 372,592.67 372,592.67 372,592.67 372,592.67 Rise revenue- Aircraft 3

### ~~~ 295,632.67 295,632.67 295,632.67 295,632.67 295,632.67 295,632.67

Riserevenue- initial**start~p** 51 ,284.00 1ee Aircraft sales & commission 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 Rise revenue- training billed 64,400.00 96,600.00 96,600.00

Fueltax credit for**no~-** Rise 130 000.00 aircraft ' Fuel taxcreditfor Rise aircraft 48 684 06 1 ' . Fuel taxcredit for Rise aircraft 36 513 04 2 ' . Fuel taxcredit for Rise aircraft 18 102 89 3 ' .
Gross revenue 1,035,898.33 920,214.33 920,214.33 1,389,407.00 1,292,807.00 1,292,807.00 1,685,039.67 1,588,439.67 1,588,439.67 1,588,439.67 1,588,439.67 1,821,739.65
COST OF GOODS SOLD Non-Rise aircraftoperating
m. 9,044.37 9,044.37 9,044.37 9,044.37 9,044.37 9,044.37 9,044.37 9,044.37 9,044.37 9,044.37 9,044.37 9,044.37 ex..,ense Non-Riseaircraftinsurance 11,354.10 11,354.10 11,354.10 11,354.10 11,354.10 11,354.10 11,354.10 11,354.10 11,354.10 11,354.10 11,354.10 11,354.10 Rise aircraft 1insurance 1,500.00 1,500.00 1,500.00 1,500.00 1,500.00 1,500.00 1,500.00 1,500.00 1,500.00 1,500.00 1,500.00 1,500.00 Rise aircraft 2 insurance 1,500.00 1,500.00 1,500.00 1,500.00 1,500.00 1,500.00 1,500.00 1,500.00 1,500.00 1,500.00 Rise aircraft 3 insurance 1,500.00 1,500.00 1,500.00 1,500.00 1,500.00 1,500.00 Rise aircraft 1hangar fees 1,500.00 1,500.00 1,500.00 1,500.00 1,500.00 1,500.00 1,500.00 1,500.00 1,500.00 1,500.00 1,500.00 1,500.00 Rise aircraft 2hangarfees 1,500.00 1,500.00 1,500.00 1,500.00 1,500.00 1,500.00 1,500.00 1,500.00 1,500.00 Rise aircraft 3hangarfees 1,500.00 1,500.00 1,500.00 1,500.00 1,500.00 1,500.00 Rise aircraft 1miscellaneous ,

.. fees .J,616.67 3,616.67 3,616.67 3,616.67 3,616.67 3,616.67 3,616.67 3,616.67 3,616.67 3,616.67 3,616.67 3,616.67

Rise aircraft 2 miscellane,ous 3,616.67 3,616.67 3,616.67 3,616.67 3,616.67 3,616.67 3,616.67 3,616.67 3,616.67 1ees Rise aircraft 3 miscellane,ous 3,616.67 3,616.67 3,616.67 3,616.67 3,616.67 3,616.67 1ees Rise aircraft 1refurbishmen!'--- 1,250.00 1,250.00 1,250.00'--- 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 

# Exhibit 6Rise aircraft 2refurbishment 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 Rise aircraft 3refurbishment 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 Non-Rise crewtraining costs 2,500.00 2,500.00 2,500.00 2,500.00 2,500.00 2,500.00 2,500.00 2,500.00 2,500.00 2,500.00 2,500.00 2,500.00 Rise aircraft 1crewtraining 70,000.00 costs Rise aircraft 2 crewtraining 105,000.00 costs Rise aircraft 3 crewtraining 105,000.00 costs Non-Rise aircraftfuel costs 37,083.33 37,083.33 37,083.33 37,083.33 37,083.33 37,083.33 37,083.33 37,083.33 37,083.33 37,083.33 37,083.33 37,083.33 Rise aircraft 1fuel**cost~** 67,020.47 67,020.47 67,020.47 67,020.47 67,020.47 67,020.47 67,020.47 67,020.47 67,020.47 67,020.47 67,020.47 67,020.47 Rise aircraft 2 fuel costs 67,020.37 67,020.37 67,020.37 67,020.37 67,020.37 67,020.37 67,020.37 67,020.37 67,020.37 Rise aircraft 3 fuel costs 49,842.37 49,842.37 49,842.37 49,842.37 49,842.37 49,842.37 Ground transportation** 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 Non-aircraftlease expense 23,166.67 23,166.67 23,166.67 23,166.67 23,166.67 23,166.67 23,166.67 23,166.67 23,166.67 23,166.67 23,166.67 23,166.67 (e.g., office space)** Licenses and fees ** 208.33 208.33 208.33 208.33 208.33 208.33 208.33 208.33 208.33 208.33 208.33 208.33! Non-Rise maintenance 82,500.00 82,500.00 82,500.00 82,500.00 82,500.00 82,500.00 82,500.00 82,500.00 82,500.00 82,500.00 82,500.00 82,500.00 Department Rise aircraft 1maintenance 27,539.24 27,539.24 27,539.24 27,539.24 27,539.24 27,539.24 27,539.24 27,539.24 27,539.24 27,539.24 27,539.24 27,539.24 departmentparts and supplies

Rise aircraft2 maintenance 27,539.24 27,539.24 27,539.24 27,539.24 27,539.24 27,539.24 27,539.24 27,539.24 27,539.24 departmentparts and supplies

Rise aircraft 3 maintenance 20,480.63 20,480.63 20,480.63 20,480.63 20,480.63 20,480.63 departmentparts and supplies

Rise aircraft I maintenance 48,333.73 48,333.73 48,333.73 48,333.73 48,333.73 48,333.73 48,333.73 48,333.73 48,333.73 48,333.73 48,333.73 48,333.73 engine reserves Rise aircraft2 maintenance 48,333.73 48,333.73 48,333.73 48,333.73 48,333.73 48,333.73 48,333.73 48,333.73 48,333.73 engine reserves Rise aircraft 3 maintenance 35,945.25 35,945.25 35,945.25 35,945.25 35,945.25 35,945.25 engine reserves Outside services ** 5,833.33 5,833.33 5,833.33 5,833.33 5,833.33 5,833.33 5,833.33 5,833.33 5,833.33 5,833.33 5,833.33 5,833.33 Pilot shop supplies ** 4,333.33 4;333.33 4,333.33 4,333.33 4,333.33 4,333.33 4,333.33 4,333.33 4,333.33 4,333.33 4,333.33 4,33-3.33 Ramp/landing fees ** 291.67 291.67 291.67 291.67 291.67 291.67 291.67 291.67 291.67 291.67 291.67 291.67 Rise required aircraft supplies 2,083.33 2,083.33 2,083.33 2,083.33 2,083.33 2,083.33 2,083.33 2,083.33 2,083.33 2,083.33 2,083.33 2,083.33 Sales department expenses ** 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 Non-Rise trip and crew 2,237.29 2,237.29 2,237.29 2,237.29 2,237.29 2,237.29 2,237.29 2,237.29 2,237.29 2,237.29 2,237.29 2,237.29

----- expenses

-- ------- -- - ,_I Rise trip and crew expenses (costs are normalized across

the year. Actual expenses wouldlikelybe slightly lower 6,946.67 6,946.67 6,946.67 6,946.67 6,946.67 6,946.67 6,946.67 6,946.67 6,946.67 6,946.67 6,946.67 6,946.67 withfewer aircraft, butpilots will not stay overnight, so

costs arenot significant
Total cost ofgoods sold 410,842.53 340,842.53 342,342.53 596,602.54 491,602.54 491,602.54 710,737.46 605,737.46 605,737.46 605,737.46 605,737.46 605,737.46
Gross profit 625,055.80 579,371.80 577,871.80 792,804.46 801,204.46 801,204.46 974,3Q2.21 982,702.21 982,702.21 982,702.21 982,702.21 1,216,002.19
EXPENSES Advertising ** 1,750.00 1,750.00 1,750.00 1,750.00 1,750.00 1,750.00 1,750.00 1,750.00 1,750.00 1,750.00 1,750.00 1,750.00 Bank fees** 250 250 ·250 250 250 250 250 250 250 250 250 250 Business promotions ** 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 Charitable contributions ** 250 250 250 250 250 250 250 250 250 250 250 250 Monarch charter department 4,166.67 4,166.67 expense 4,166.67 4,166.67 4,166.67 4,166.67 4,166.67 4,166.67 4,166.67 4,166.67 4,166.67 4,166.67 Monarch charter department expense- 41C (fuel, database 33,333,33

. 33,333,33 33,333,33 33,333,33 33,333,33 33,333,33 33,333,33 33,333,33 33,333,33 33,333,33 33,333,33 33,333,33 subscriptions, crew expenses ) Computer expense and 2,916.66 2,916.66 2,916.66 2,916.66 2,916.66 2,916.66 2,916.66 2,916.66 2,916.66 2,916.66 2,916.66 2,916.66 upgrades** Consulting service ** 7,166.67 7,166.67 7,166.67 7,166.67 7,166.67 7,166.67 7,166.67 7,166.67 7,166.67 7,166.67 7,166.67 7,166.67 Contractlabor * * 17,000.00 17,000.00 17,000.00 17,000.00 17,000.00 17,000.00 17,000.00 17,000.00 17,000.00 17,000.00 17,000.00 17,000.00 Credit card fees * * 4,166.67 4,166.67 4,166.67 4,166.67 4,166.67 4,166.67 4,166.67 4,166.67 4,166.67 4,166.67 4,166.67 4,166.67 Delivery and freight * * 2,333.33 2,333.33 2,333.33 2,333.33 2,333.33 2,333.33 2,333.33 2,333.33 2,333.33 2,333.33 2,333.33 2,333.33 Dues and subscriptions ** 1,833.33 1,833.33 1,833.33 1,833.33 1,833.33 1,833.33 1,833.33 1,833.33 1,833.33 1,833.33 1,833.33 1,833.33 Franchise tax ** 12,083.33 12,083.33 12,083.33 12,083.33 12,083.33 12,083.33 12,083.33 12,083.33 12,083.33 12,083.33 12,083.33 12,083.33 Non-Rise Hangar services 5,266.67 5,266.67 5,266.67 5,266.67 5,266.67 5,266.67 5,266.67 5,266.67 5,266.67 5,266.67 5,266.67 5,266.67 Insurance (non-aircraft) ** 3,541.67 3,541.67 3,541.67 3,541.67 3,541.67 3,541.67 3,541.67 3,541.67 3,541.67 3,541.67 3,541.67 3,541.67 LOC interest expense 3,054.62 2,993.89 2,649.03 2,870.19 2,717.96 2,746.21 2,597.40 2,621.04 2,558.21 2,414.59 2,431.26 2,291.13 Rise aircraft 2 interest expense 10,416.67 10,349.58 10,282.22 10,214.58 10,146.66 10,078.45 10,009.96 9,941.18 9,872.12

.. Rise aircraft 3 interest expense 10,416.67 10,349.58 10,282.22 10,214.58 10,146.66 10,078.45 Rise aircraft 1Lease Expense 38,150.00 38,150.00 38,150.00 38,150.00 38,150.00 38,150.00 38,150.00 38,150.00 38,150.00 38,150.00

. 38,150.00 38,150.00 Legal andprofessional 4,666.66 4,666.66 4,666.66 4,666.66 4,666.66 4,666.66 4,666.66 4,666.66 4,666.66 4,666.66 4,666.66 4,666.66
L__ services**

-Non-Rise aircraftMaintenance 12,083.33 12,083.33 12,083.33 12,083.33 12,083.33 12,083.33 12,083.33 12,083.33 12,083.33 12,083.33 12,083.33 12,083.33 serviceplans Meals and entertainment** 1083.33 1083.33 1083.33 1083.33 1083.33 1083.33 1083.33 1083.33 1083.33 1083.33 1083.33 1083.33

Miscellaneous expense** 2,500.00 2,500.00 2,500.00 2,500.00 2,500.00 2,500.00 2,500.00 2,500.00 2,500.00 2,500.00 2,500.00 2,500.00 Officeexpense** 2,666.67 2,666.67 2,666.67 2,666.67 2,666.67 2,666.67 2,666.67 2,666.67 2,666.67 2,666.67 2,666.67 2,666.67 Office supplies ** 3,500.00 3,500.00 3,500.00 3,500.00 3,500.00 3,500.00 3,500.00 3,500.00 3,500.00 3,500.00 3,500.00 3,500.00 Non-Risepayroll service fees 933 1,500.00 1,500.00 1,500.00 1,500.00 1,500.00 1,500.00 1,500.00 1,500.00 1,500.00 1,500.00 1,500.00 ** Risepayroll service fees ** 166 166 166 415 415 415 666 666 666 666 666 666

Printing and reproduction 825 825 825 825 825 825 825 825 825 825 825 825 costs** Reference library ** 1,850.00 1,850.00 1,850.00 1,850.00 1,850.00 1,850.00 1,850.00 1,850.00 1,850.00 1,850.00 1,850.00 1,850.00 Rent expense ** 27,916.67 27,916.67 27,916.67 27,916.67 27,916.67 27,916.67 27,916.67 27,916.67 27,916.67 27,916.67 27,916.67 27,916.67 Non-aircraftRepairs and 3,333.33 3,333.33 3,333.33 3,333.33 3,333.33 3,333.33 3,333.33 3,333.33 3,333.33 3,333.33 3,333.33 3,333.33 maintenance ** · Small shop tools ** 3,333.33 3,333.33 3,333.33 3,333.33 3,333.33 3,333.33 3,333.33 3,333.33 3,333.33 3,333.33 3,333.33 3,333.33 Taxes** 7,166.67 7,166.67 7,166.67 7,166.67 7,166.67 7,166.67 7,166.67 7,166.67 7,166.67 7,166.67 7,166.67 7,166.67 Telephone and 5,416.67 5,416.67 5,416.67 5,416.67 5,416.67 5,416.67 5,416.67 5,416.67 5,416.67 5,416.67 5,416.67 5,416.67 communications** Training and education (unrelatedto crewtraining, 2,916.66 2,916.66 2,916.66 2,916.66 2,916.66 2,916.66 2,916.66 2,916.66 2,916.66 2,916.66 2,916.66 2,916.66 which is already accounted for) ** Travel** 2,583.33 2,583.33 2,583.33 2,583.33 2,583.33 2,583.33 2,583.33 2,583.33 2,583.33 2,583.33 2,583.33 2,583.33 Uniforms 250 250 250 250 250 250 250 250 250 250 250 250 Utilities ** 3,250.00 3,250.00 3,250.00 3,250.00 3,250.00 3,250.00 3,250.00 3,250.00 3,250.00

. 3,250.00 3,250.00 3,250.00 Non-Risewages and salaries

(includes payroll taxes and 202,916.66 202,916.66 202,916.66 202,916.66 202,916.66 202,916.66 202,916.66 202,916.66 202,916.66 202,916.66 202,916.66 202,916.66 employeebenefits programs) Rise wages and salaries

-- administrative staff(includes 8,333.33 8,333.33 8,333.33 8,333.33 8,333.33 8,333.33 8,333.33 8,333.33 8,333.33 8,333.33 8,333.33 8,333.33

payroll taxes and employee benefitsprograms) Rise wages and salaries aircraft I

-- maintenance 6,250.00 6,250.00 6,250.00 6,250.00 6,250.00 6,25(l..00 6,250.00 6,250.00 6,250.00 6,250.00 6,250.00 6,250.00 (includes payroll taxes and employeebenefits programs Rise wages_and salaries

.. aircraft2 and 3 - maintenance 13,888.89 13,888.89 13,888.89 13,888.89 13,888.89 13,888.89 13,888.89 13,888.89 13,888.89 (includes payroll and

employeebenefits)Rise wages and salaries aircraft I

-- 2 flight crew 25,800.00 25,800.00 25,800.00 25,800.00 25,800.00 25,800.00 25,800.00 25,800.00 25,800.00 25,800.00 25,800.00 25,800.00 (includes payroll taxes and employeebenefitsprograms) Rise wages and salaries aircraft 2

-- 3 flight crew 38,700.00 38,700.00 38,700.00 38,700.00 38,700.00 38,700.00 38,700.00 38,700.00 38,700.00 (includes payroll taxes and employeebenefits programs) Rise wages and salaries aircraft 3

-- 3 flight crew 38,700.00 38,700.00 38,700.00 38,700.00 38,700.00 38,700.00 (includes payroll taxes and employeebenefits programs
Total expenses 434,920.26 435,426.53 435,081.67 498,557.39 498,338.07 498,298.96 547,450.18 547,338.81 547,140.41 546,860.66 546,740.63 546,463.23
Revenues over (under) 190,135.54 143,945.27 142,790.13 294,247.07 302,866.39 302,905.50 426,852.03 435,363.40 435,561.80 435,841.55 435,961.58 669,538.96 expenses before depreciation Depreciation

- Income Tax 4,166.67 4,166.67 4,166.67 4,166.67 4,166.67 4,166.67 4,166.67 4,166.67 4,166.67 4,166.67 4,166.67 4,166.67 Basis Depreciation- Income Tax 19,833.33 19,833.33 19,833.33 19,833.33 19,833.33 19,833.33 19,833.33 19,833.33 19,833.33 Basis Rise Aircraft 2 Depreciation- Income Tax 29,750.00 29,750.00 29,750.00 29,750.00 29,750.00 29,750.00 Basis Rise Aircraft 3
Revenues over (under) 185,968.87 139,778.60 138,623.46 270,247.07 278,866.39 278,905.50 373,102.03 381,613.40 381,811.80 382,091.55 382,211.58 615,788.96 expenses afterdepreciation 

### * * denotes indirect costs

----- ---------

### Projected Revenues and Expenses- Non-Rise Operations Month 1 Month 2 Month 3 Month4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12 

### REVENUES Feerevenue 550,000.00 550,000.00 550,000.00 550,000.00 550,000.00 550,000.00 550,000.00 550,000.00 550,000.00 550,000.00 550,000.00 550,000.00

Aircraft sales & commission 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00. 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00

Fuel tax creditfor aircraft 130,000.00 

### Gross revenue 551,250.00 551,250.00 551,250.00 551,250.00 551,250.00 551,250.00 551,250.00 551,250.00 551,250.00 551,250.00 551,250.00 681,250.00


### COSTOFGOODS SOLD Aircraft operating expense 9,044.37 9,044.37 9,044.37 9,044.37 9,044.37 9,044.37 9,044.37 9,044.37 9,044.37 9,044.37 9,044.37 9,044.37 Aircraft insurance 11,354.10 11,354.10 11,354.10 11,354.10 11,354.10 11,354.10 11,354.10 11,354.10 11,354.10 11,354.10 11,354.10 11,354.10 Crewtraining costs 2,500.00 2,500.00 2,500.00 2,500.00 2,500.00 2,500.00 2,500.00 2,500.00 2,500.00 2,500.00 2,500.00 2,500.00

Aircraft fuel costs 37,083.33 37,083.33 37,083.33 37,083.33 37,083.33 37,083.33 37,083.33 37,083:33 37,083.33 37,083.33 37,083.33 37,083.33 Groundtransportation ** 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 Non-aircraft lease expense 23,166.67 23,166.67 23,166.67 23,166.67 23,166.67 23,166.67 23,166.67 23,166.67 23,166.67 23,166.67 23,166.67 23,166.67 (e.g., office space)** Licenses and fees ** 208.33 208.33 208.33 208.33 208.33 208.33 208.33 208.33 208.33 208.33 208.33 208.33 MaintenanceDepartment 82,500.00 82,500.00 82,500.00 82,500.00 82,500.00 82,500.00 82,500.00 82,500.00 82,500.00 82,500.00 82,500.00 82,500.00

· Outside services ** 3,750.00 3,750.00 3,750.00 3,750.00 3,750.00 3,750.00
.3,750.00 3,750.00 3,750.00 3,750.00 3,750.00 3,750.00 Pilot shop supplies ** 4,333.33 4,333.33 4,333.33 4,333.33 4,333.33 4,333.33 4,333.33 4,333.33 4,333.33 4,333.33 4,333.33 4,333.33 Ramp/landing fees** 291.67 291.67 291.67 291.67 291.67 291.67 291.67 291.67 291.67 291.67 291.67 291.67 Sales department expenses** 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 .1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 Trip and crew expenses 2,237.29 2,237.29 2,237.29 2,237.29 2,237.29 2,237.29 2,237.29 2,237.29 2,237.29 2,237.29 2,237.29 2,237.29 

### Total cost ofgoods sold 178,969.09 178,969.09 178,969.09 178,969.09 178,969.09 178,969.09 178,969.09 178,969.09 178,969.09 178,969.09 178,969.09 178,969.09


### Gross profit 372,280.91 372,280.91 372,280.91 372,280.91 372,280.91 372,280.91 372,280.91 372,280.91 372,280.91 372,280.91 372,280.91 502,280.91


### EXPENSES Advertising ** 1,750.00 1,750.00 1,750.00 1,750.00 1,750.00 1,750.00 1,750.00 1,750.00 1,750.00 1,750.00 1,750.00 1,750.00 Bank fees** 250 250 250 250 250 250 250 250 250 250 250 250 Business promotions ** 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00

.. 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 Charitable contributions ** 250 250 250 250 250 250 250 250 250 250 250 250 Monarchcharter department expense 4,166.67 4,166.67 4,166.67 4,166.67 4,166.67 4,166.67 4,166.67 4,166.67 4,166.67 4,166.67 4,166.67 4,166.67 Monarch charter department 33,333,33 33,333,33 33,333,33 33,333,33 33,333,33 33,333,33 33,333,33 33,333,33 33,333,33 33,333,33 33,333,33 33,333,33 -··expense- 41CComputer expense and 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 upgrades ** Consulting service ** 4,166.67 4,166.67 4,166.67 4,166.67 4,166.67 4,166.67 4,166.67 4,166.67 4,166.67 4,166.67 4,166.67 4,166.67 Contract labor** 15,000.00 15,000.00 15,000.00 15,000.00 15,000.00 15,000.00 15,000.00 15,000.00 15,000.00 15,000.00 15,000.00 15,000.00 Credit card fees ** 4,166.67 4,166.67 4,166.67 4,166.67 4,169.67 4,166.67 4,166.67 4,166.67 4,166.67 4,166.67 4,166.67 4,166.67 Delivery and freight ** 2,333.33 2,333.33 2,333.33 2,333.33 2,333.33 2,333.33 2,333.33 2,333.33 2,333.33 2,333.33 2,333.33 2,333.33 Dues and subscriptions ** 1,583.33 1,583.33 1,583.33 1,583.33 1,583.33 1,583.33 1,583.33 1,583.33 1,583.33 1,583.33 1,583.33 1,583.33 Franchise tax ** 3,750.00 3,750.00 3,750.00 3,750.00 3,750.00 3,750.00 3,750.00 3,750.00 3,750.00 3,750.00 3,750.00 3,750.00 Non-RiseHangar services 5,266.67 5,266.67 5,266.67 5,266.67 5,266.67 5,266.67 5,266.67 5,266.67 5,266.67 5,266.67 5,266.67 5,266.67 Insurance (non-aircraft) ** 3,541.67 3,541.67 3,541.67 3,541.67 3,541.67 3,541.67 3,541.67 3,541.67 3',541.67 3,541.67 3,541.67 3,541.67 LOC interest expense 3,054.62 2,993.89 2,649.03 2,870.19 2,717.96 2,746.21 2,597.40 2,621.04 2,558.21 2,414.59 2,431.26 2,291.13 Legal and professional 1,666.66 1,666.66 1,666.66 1,666.66 1,666.66 1,666.66 1,666.66 1,666.66 1,666.66 1,666.66 1,666.66 1,666.66 services ** AircraftMaintenance service 12,083.33 12,083.33 12,083.33 12,083.33 12,083.33 12,083.33 12,083.33 12,083.33 12,083.33 12,083.33 12,083.33 12,083.33 plans Meals and entertainment ** 833.33 833.33 833.33 833.33 833.33 833.33 833.33 833.33 833.33 833.33 833.33 833.33

Miscellaneous expense** 1,666.67 1,666.67 1,666.67 1,666.67 1,666.67 1,666.67 1,666.67 1,666.67 1,666.67 1,666.67 1,666.67 1,666.67 Office expense ** 1,666.67 1,666.67 1,666.67 1,666.67 1,666.67 1,666.67 1,666.67 1,666.67 1,666.67 1,666.67 1,666.67 1,666.67 Office supplies ** 2,500.00 2,500.00 2,500.00 2,500.00 2,500.00 2,500.00 2,500.00 2,500.00 2,500.00 2,500.00 2,500.00 2,500.00 Payroll service fees ** 933 1,500.00 1,500.00 1,500.00 1,500.00 1,500.00 1,500.00 1,500.00 1,500.00 1,500.00 1,500.00 1,500.00 Printing and reproduction 625 625 625 625 625 625 625 625 625 625 625 625 costs ** Reference library ** 1,016.67 1,016.67 1,016.67 1,016.67 1,016.67 1,016.67 1,016.67 1,016.67 1,016.67 1,016.67 1,016.67 1,016.67 Rent expense ** 27,916.67 27,916.67 27,916.67 27,916.67 27,916.67 27,916.67 27,916.67 27,916.67 27,916.67 27,916.67 27,916.67 27,916.67 Non-aircraftRepairs and 3,333.33 3,333.33 3,333.33 3,333.33 3,333.33 3,333.33 3,333.33 3,333.33 3,333.33 3,333.33 3,333.33 3,333.33 maintenance** Small shop tools ** 3,333.33 3,333.33 3,333.33 3,333.33 3,333.33 3,333.33 3,333.33 3,333.33 3,333.33 3,333.33 3,333.33 3,333.33 Taxes** 4,166.67 4,166.67 4,166.67 4,166.67 4,166.67 4,166.67 4,166.67 4,166.67 4,166.67 4,166.67 4,166.67 4,166.67 Telephone and 5,416.67 5,416.67 5,416.67 5,416.67 5,416.67 5,416.67 5,416.67 5,416.67 5,416.67 5,416.67 5,416.67 5,416.67 communications ** Training and education (unrelatedto crewtraining, 2,500.00 2,500.00 2,500.00 2,500.00 2,500.00 2,500.00 2,500.00 2,500.00 2,500.00 2,500.00 2,500.00 2,500.00 which is separately accounted for)** Travel ** 2,083.33 2,083.33 2,083.33 2,083.33 2,083.33 2,083.33 2,083.33 2,083.33 2,083.33 2,083.33 2,083.33 2,083.33 Uniforms 250 250 250 250 250 250 250 250 250 250 250 250 Utilities ** 3,250.00 3,250.00 3,250.00 3,250.00 3,250.00 3,250.00 3,250.00 3,250.00 3,250.00 3,250.00 3,250.00 3,250.00Wages and salaries (includes payroll taxes and employee 202,916.66 202,916.66 202,916.66 202,916.66 202,916.66 202,916.66 202,916.66 202,916.66 202,916.66 202,916.66 202,916.66 202,916.66 benefits programs Total expenses 329,937.62 330,443.89 330,099.03 330,320.19 330,167.96 330,196.21 330,047.40 330,071.04 330,008.21 329,864.59 329,881.26 329,741.13

Revenues over (under) I 42,343.29 41,837.02 42,181.88 41,960.72 42,112.95 42,084.70 42,233.51 42,209.87 42,272.70 42,416.32 42,399.65 172,539.78 1 expenses before depreciation Depreciation

-Income Tax 4,166.67 4,166.67 4,166.67 4,166.67 4,166.67 4,166.67 4,166.67 4,166.67 4,166.67 4,166.67 4,166.67 4,166.67 Basis

. Revenues over (under) 38,176.62 37,670.35 38,015.21 37,794.05 37,946.28 37,918.03 38,066.84 38,043.20 38,106.03 38,249.65 38,232.98 168,373.11 expenses after depreciation 

### ** denotes indirectcostsProjectedRevenues and Expenses- Rise Operations Month I Month2 Month 3 Month4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month II Month 12 REVENUES Rise revenue - Aircraft I DAL 368,96433 368,964.33 368,964.33 368,964 33 368,964.33 368,964.33 368,964.33 368,96433 368,96433 368,96433 368,964.33 368,964.33 HOU Rise revenue- Aircraft 2DAL 372,592.67 372,592.67 372;592.67 372,592.67 372,592.67 372,592.67 372,592.67 372,592.67 372,592.67 HOU Rise revenue - Aircraft 3DAL 295,632.67 295,632.67 295,632.67 295,632.67 295,632.67 295,632.67 AUS Riserevenue- initial startup 51,284.00 fee Riserevenue- training billed 64,400.00 96,600.00 96,600.00 Fuel taxcredit for Rise aircraft 48,684.06 I Fuel tax creditfor Rise aircraft 36,513.04 2 Fuel tax creditfor Rise aircraft 18,102.89 3
Gross revenue 484,648.33 368,964.33 368,964.33 838,157.00 741,557.00 741,557.00 1,133,789.67 1,037,189.67 1,037,189.67 1,037,189.67 1,037,189.67 1,140,489.65
COST OFGOODSSOLD Rise aircraft I insurance 1,500.00 1,500.00 I,500.00 1,500.00 1,500.00 1,500.00 1,500.00 1,500.00 I,500.00 1,500.00 I,500.00 I,500.00 Rise aircraft 2 insurance 1,500.00 1,500.00 1,500.00 I,500.00 1,500.00 I,500.00 1,500.00 I,500.00 1,500.00 1,500.00 Rise aircraft 3insurance 1,500.00 1,500.00 1,500.00 1,500.00 1,500.00 1,500.00 Rise aircraft I hangarfees I,500.00 1,500.00 I,500.00 I,500.00 I,500.00 1,500.00 I,500.00 I,500.00 I,500.00 I,500.00 I,500.00 1,500.00 Rise aircraft 2 hangarfees 1,500.00 1,500.00 I,500.00 I,500.00 I,500.00 1,500.00 I,500.00 1,500.00 1,500.00 Riseaircraft 3hangarfees 1,500.00 1,500.00 I,500.00 1,500.00 1,500.00 1,500.00 Rise aircraft I miscellaneous 3,616.67 3,616.67 3,616.67 3,616.67 3,616.67 3,616.67 3,616.67 3,616.67 3,616.67 3,616.67 3,616.67 3,616.67 fees Rise aircraft 2miscellaneous 3,616.67 3,616.67 3,616.67 3,616.67 3,616.67 3,616.67 3,616.67 3,616.67 3,616.67 fees Rise aircraft 3miscellaneous 3,616.67 3,616.67 3,616.67 3,616.67 3,616.67 3,616.67 fees Rise aircraft I refurbishment 1,250.00 I,250.00 1,250.00 1,250.00 I,250.00 1,250.00 1,250.00 1,250.00 I,250.00 1,250.00 1,250.00 1,250.00 Rise aircraft2 refurbishment 1,250.00 I,250.00 I,250.00 I,250.00 I,250.00 I,250.00 I,250.00 I,250.00 1,250.00 Rise aircraft 3 refurbishment 1,250.00 1,250.00 I,250.00 1,250.00 I,250.00 1,250.00 Rise aircraft I crewtraining 70,000.00 costs Rise aircraft 2 crewtraining 105,000.00 costs Rise aircraft 3 crew training 105,000.00 costs Rise aircraft I fuel costs 67,020.47 67,020.47 67,020.47 67,020.47 67,020.47 67,020.47 67,020.47 67,020.47 67,020.47 67,020.47 67,020.47 67,020.47 Rise aircraft2 fuel costs 67,020.37 67,020.37 67,020.37 67,020.37 67,020.37 67,020.37 67,020.37 67,020.37 67,020.37 Rise aircraft 3fuel costs 49,842.37 49,842.37 49,842.37 49,842.37 49,842.37 49,842.37 Ground transportation ** No cost assessed againstRise operations because costs are not expectedto increase as a result ofthenew operations. Non-aircraft lease expense No cost assessed against Rise operations because costs are not expectedto increase as a result ofthe new operations. Monarch already has ample office space for additional staffand operations. (e.g., office space)**Licenses and fees Rise aircraft I maintenance 27,539.24 departmentparts and supplies

Rise aircraft2 maintenance departmentparts and supplies

Rise aircraft 3 maintenance departmentparts and supplies

Rise aircraft I maintenance 48,333.73 engine reserves Rise aircraft 2 maintenance engine reserves Rise aircraft 3 maintenance enginereserves Outside services ** 2083.33 Pilot shop supplies ** Ramp/landingfees ** Rise required aircraft supplies 2,083.33 Sales departmentexpenses **

Risetrip and crewexpenses (costs are normalized across

theyear. Actual expenses would likely be slightly lower 6,946.67 with fewer aircraft, butpilots will not stay overnight, so

costs are not significant
Total costofgoods sold 231,873.44
Gross Profit 252,774.89
EXPENSES Advertising ** Bank fees** Business promotions ** Charitablecontributions ** Computerexpense and 1666.66 u=ades ** Consultingservice ** 3000 Contract labor** 2000 Creditcard fees ** Deliveryand freight** Duesand subscriptions ** 250 Franchise tax ** 8333.33 Insurance (non-aircraft) ** No costassessed againstRise operationsbecause costs are not expectedto increase as a resultofthe new operations. 27,539.24 27,539.24 27,539.24 27,539.24 27,539.24 27,539.24 27,539.24 27,539.24 27,539.24 • 27,539.24
27,539.24 27,539.24 27,539.24 27,539.24 27,539.24 27,539.24 27,539.24 27,539.24
20,480.63 20,480.63 20,480.63 20,480.63 20,480.63 48,333.73 48,333.73 48,333.73 48,333.73 48,333.73 48,333.73 48,333.73 48,333.73 48,333.73 48,333.73 48,333.73 48,333.73 48,333.73 48,333.73 48,333.73 48,333.73 48,333.73 48,333.73 35,945.25 35,945.25 35,945.25 35,945.25 35,945.25 2083.33 2083.33 2083.33 2083.33 2083.33 2083.33 2083.33 2083.33 2083.33 2083.33 No costassessed againstRise operationsbecause costs are notexpected to increase as a result ofthe newoperations No costassessed againstRise operationsbecause costs are notexpected to increase as a resultofthe new operations 2,083.33 2,083.33 2,083.33 2,083.33 2,083.33 2,083.33 2,083.33 2,083.33 2,083.33 2,083.33

6,946.67 6,946.67 6,946.67 6,946.67 6,946.67 6,946.67 6,946.67 6,946.67 6,946.67 6,946.67

161,873.44 163,373.44 417,633.45 312,633.45 312,633.45 531,768.37 426,768.37 426,768.37 426,768.37 426,768.37 207,090.89 205,590.89 420,523.55 428,923.55 428,923.55 602,021.30 610,421.30 610,421.30 610,421.30 610,421.30

No cost assessed againstRise operations because costs are to be borne solely by Rise. No cost assessed againstRise operationsbecause costs are not expectedto increase as a result ofthe newoperations. No cost assessed againstRise operations because costs are not expected to increase as aresult ofthe new operations. All promotion costs are to be borne solelyby Rise. No costassessed againstRise operationsbecause costs are not expectedto increase as a result ofthe newoperations. 1666.66 1666.66 1666.66 1666.66 1666.66 1666.66 1666.66 1666.66 1666.66 1666.66

3000 3000 3000 3000 3000 3000 3000 3000 3000 3000 2000 200Q. 2000 2000 2000 2000 2000 2000 2000 2000 No cost assessed againstRise operationsbecause costs are notexpectedto increase as a result ofthe new operations. Rise will beinvoiced viaa draw-down on its letter ofcredit. No cost assessed againstRise operationsbecause costs are not expectedto increase as a result ofthe newoperations. 250 250 250 250 250 250 250 250 250 250 8333.33 8333.33 8333.33 8333.33 8333.33 8333.33 8333.33 8333.33 8333.33 8333.33 No costassessed against Rise operationsbecause costs are not expected to increase as a result ofthe newoperations. 27,539.24
27,539.24
20,480.63 48,333.73 48,333.73 35,945.25

2083.33!

2,083.33

6,946.67

426,768.37 713,721.28

1666.66

3000**200~**

25( 8333.33 Total Cost ofGoods Total Expenses Total ofboth
25% oftotal expense Pre-operatingcost DOT Fitness Number 4,265,630.89 2,121,838.27 6,387,469.16
1,596,867.29 88,000.00 1,684,867.29Rise aircraft2 interestexpense 10,416.67 10,349.58 10,282.22 10,214.58 10,146.66 10,078.45 10,009.96 9,941.18 9,872.12 Rise aircraft 3 interest expense 10,416.67 .10,349.58 10,282.22 10,214.58 I0,146.66 10,078.45 Rise aircraft I Lease Expense 38,150.00 38,150.00 38,150.00 38,150.00 38,150.00 38,150.00 38,150.00 38,150.00 38,150.00 38,150.00 38,150.00 38,150.00 Legal and professional 3000 3000 3000 3000 3000 3000 3000 3000 3000 3000 3000 3000 services** Mealsand entertainment** 250 250 250 250 250 250 250 250 250 250 250 250

Miscellaneous expense ** 833.33 833.33 833.33 833.33 833.33 833.33 833.33 833.33 833.33 833.33 833.33 833.33 Office expense ** 1000 1000 1000 1000 1000 1000 1000 1000 1000 1000 1000 1000 Office supplies ** 1000 1000 1000 1000 1000 1000 1000 1000 1000 1000 1000 1000 Risepayroll service fees ** !66 166 166 415 .415 415 666 666 666 666 666 666

Printingandreproduction 200.00 200.00 200.00 200.00 200.00 200.00 200.00 200.00 200.00 200.00 200.00 200.00 costs 

### ** Reference library ** 833.33 833.33 833.33 833.33 833.33 833.33 833.33 833.33 833.33 833.33 833.33 833.33 Rent expense ** No cost assessed againstRise operations because costs are not expected to increase as a result ofthe new operations. Non-aircraftRepairs and No cost assessed againstRise operations because costs are not expected to increase as a result ofthe new operations. maintenance

### ** Small shop tools ** No costassessed againstRise operations because costs are not expected to increase as a result ofthe new operations. Taxes** 3000 3000 3000 3000 3000 3000 3000 3000 3000 3000 3000 3000 Training and education (unrelatedto crewtraining, which is separatelyaccounted 416.66 416.66 416.66 416.66 416.66 416.66 416.66 416.66 416.66 416.66 416.66 416.66 fnri ** Telephone and No cost assessed againstRise operationsbecause costs are not expectedto increase as a result ofthe new operations. communiCations ** Travel** 500 500 500 500 500 500 500 500 500 500 500 500 Uniforms No cost assessed againstRise operationsbecause costs are notexpectedto increase as a result ofthe new operations. Utilities ** No cost assessed againstRise operationsbecause costs are notexpected to increase as a result ofthe new operations. Rise wages and salaries

-- administrative staff(includes 8,333.33 8,333.33 8,333.33 8,333.33 8,333.33 8,333.33 8,333.33 8,333.33 8,333.33 8,333.33 8,333.33 8,333.33

payroll taxes and employee benefitsprograms Rise wages and salaries aircraft I --maintenance 6,250.00 6,250.00 6,250.00 6,250.00 6,250.00 6,250.00 6,250.00 6,250.00 6,250.00 6,250.00 6,250.00 6,250.00 (includespayroll taxes and employeebenefits programs Rise wages and salaries aircraft 2 and 3 - maintenance 13,888.89 13,888.89 13,888.89 13,888.89 13,888.89 13,888.89 13,888.89 13,888.89 13,888.89 (includes payroll and

employeebenefits) Rise wages and salaries aircraft I

-- 2 flight crew 25,800.00 25,800.00 25,800.00 25,800.00 25,800.00 25,800.00 25,800.00 25,800.00 25,800.00 25,800.00 25,800.00 25,800.00 (includes payroll taxes and .. .. employeebenefits programs Rise wages and salaries

. aircraft 2

-- 3 flight crew 38,700.00 38,700.00 38,700.00 38,700.00 38,700'.00 38,700.00 38,700.00 38,700.00 38,700.0C (includes payroll taxes and employeebenefits programs)Rise wages and salaries aircraft 3

-- 3flight crew 38,700.00 38,700.00 38,700.00 38,700.00 38,700.00 38,700.00 (includespayroll taxes and employeebenefits programs
Totalexpenses 104,982.64 104,982.64 104,982.64 168,237.20 168,170.11 168,102.75 217,402.78 217,267.77 217,132.20 216,996.07 216,859.37 216,722.10

Revenues over (under) 147,792.25 102,108.25 100,608.25 252,286.35 260,753.44 260,820.80 384,618.52 393,153.53 393,289.10 393,425.23 393,561.93 496,999.18 expensesbeforedepreciation Depreciation

- Income Tax 19,833.33 19,833.33 19,833.33 19,833.33 19,833.33 19,833.33 19,833.33 19,833.33 19,833.33 BasisRiseAircraft2 Depreciation- Income Tax 29,750.00 29,750.00 29,750.00 29,750.00 29,750.00 29,750.00 BasisRiseAircraft 3
Revenues over(under) 147,792.25 102,108.25 100,608.25 232,453.02 240,920.11 240,987.47 335,035.19 343,570.20 343,705.77 343,841.90 343,978.60 447,415.85 expensesafterdepreciation ** denotes indirectcosts