U.S. Department of Transportation Office ofthe Secretary ofTransportation 

### August 11, 2014 Mr. AaronA. Goerlich Counsel for Aerodynamics Incorporated Garofalo Goerlich Hainbach PC 1200NewHampshireAve. NW Washington, DC 20036 RE: Dockets DOT-OST-2014-0114 Application ofAerodynamics Incorporated ;**~;** ; . ' (;: 1200 New JerseyAvenue SE Washington DC 20590



### for a Certificate of Public Convenience and Necessity to engage in interstate scheduled air transportation ofpersons, property, and mail DearMr. Goerlich: Thank you for the information you have provided on behalf of Aerodynamics Incorporated ("ADI"), for the determination of its fitness to operate interstate scheduled air transportation. We have determined that we will need additional and/or clarifying information before we may complete our review. I ask that you respond fully to our request within 30 days ofthe date of this letter. As is the Department'spractice, further processing ofADI's applicationwill be deferredpending receipt ofthis information. In addition, please remember that ADI should promptly provide the Department with any information regarding changes it may undergo in areas affecting its fitness (i.e., 

### management, operating plans or financial condition, compliance disposition, or ownership) while its applicationis under reviewbythe Department. As you are aware, it is the Department's practice to determine an applicant's financial fitness in orderto ensure it will have access to resources sufficientto commence operations withoutposing anundue riskto consumers. This financial fitness test is based on the level offunds required to cover the applicant's pre-operating costs for the proposed operations, and to provide the company with a working capital reserve equal to one-quarter ofits operating expenses for the first year of the proposed operations. In addition, ifthe applicant's most recent balance sheet shows a negative working capital balance for any ongoing operations, the amount of that working capital deficit will be considered a pre-operating expense in calculating the amount of funds that the applicantmusthave available to meetthe financial fitness criteria for the proposed operations. Moreover, the company must demonstrate it has obtained all ofthe funding needed to meet ourfinancial fitness test, or at aminimum, have areasonable plan for doing so. Based on our review of the pre-operating and first-year expense forecasts and the financial statements submitted, we calculate that ADI will need approximately $1.198 millionto meet our2

financial fitness test. The $1.198 million consists of $119,882 in pre-operating expenses, plus about $1.04 million, which is one fourth of its first year expenses, plus $36,385 in negative working capital. In support ofits financial fitness, ADI provided, among otherthings, the following items: (1) Bank statements from JP Morgan Chase Bank and First Niagara Bank1 dated March 31, 2014, showing thatthe aircarrierhas about $650,000 ondeposit inits name. (2) A letter from Western Reserve Port Authority, Youngstown-Warren Regional Airport, stating that financial support for the establishment and continuation ofADI's service will be provided by the Youngstown Parties, specifically, revenue guarantees totaling $1.2 million. We have reviewed the information submitted and find that ADI must provide additional informationto support its abilityto meet ourfinancial fitness test. While the bank statements show the amount of cash ADI has on deposit in its name, we are unable to consider these deposits as sources of capital since we accounted for the air carrier's cashbalance when calculating its working capital position. Concerningthe $1.2 million revenue guarantee, we are unable to considerthis revenue guarantee as a source ofcapital to support ADI's proposed scheduled operations. Should the air carrier wishfor us to considerthe financial support valued at $1.2 million from the YoungstownParties, ADI shouldthenprovide us with a statementfrom the YoungstownParties ofthe amount ofsuch available resources and the terms and conditions under which such funds will be provided. Copies ofthe financial statements ofthe individual(s) or organization(s) should also be provided. Such documentation should clearly establish the capability ofthe individual(s) or organization(s) to fulfill any financial commitmentmade to or onbehalfofthe applicant. Inthis connection, the liquidity of any assets, other than cash, contained in these documents should be made clear through appropriate footnotes (e.g., the current market value of stocks and bonds that can be readily converted to cash should be noted). Third-party verification of the assets and values should be provided (e.g., letters from banks or stockbrokers holding liquid assets, or recent appraisals ofreal assets). The original plus 3 copies of your response should be mailed to U.S. Department of Transportation, Docket Operations (M-30, Room W12-140), 1200 New Jersey Avenue, S.E., Washington, DC 20590, oryoumay electronically file yourresponse atwww.regulations.gov. The information provided pursuant to this Information Request should be accompanied by the following certification:

As a point ofclarification, it is our understanding that the cash balance reported in ADI's First Niagara Bank account is being held in escrow until a charter flight or flights has been completed. Should ADI wish for us to consider its escrow account balance, it must provide information (flights and dates) and the corresponding dollar amount attributable only to those completed flights.3

The contents ofthis application and the attached exhibit (s) are true and correct to the best ofmyknowledge and belief. Pursuant to Title 18 United States Code Section 1001, I 

### [the individual signing the application, who shall be aprincipal owner, senior officer, or internal counsel ofthe applicant], in my individual capacity and as the authorized representative ofthe applicant, have not in any manner knowingly and willfully falsified, concealed or failed to disclose any material fact or made any false, fictitious, or fraudulent statement or knowingly used any documents which contain such statements in connection with the preparation, filing or prosecution ofthe application. I understand that an individual who is found to have violated the provisions of 18 U.S.C section 1001 shall be fined orimprisoned notmore than five years, orboth. Ifyou have any questions regarding this letter or the requested information, please contact me at 202-366-9721 orviaemail at Catherine.O'Toole@dot.gov. Sincerely,

Laural J. Remo

### Chief,,~ir CarrierFitness Division Office ofAviation Analysis

cc: DocketDOT-OST-2014-0114 Mr. Bruce Clamp, POI FAAAtlantaFSDO