BEFORE THE 

DEPARTMENT OF TRANSPORTATION 

WASHINGTON, D.C. 

 ) 

Application of ) 

 ) 

AVIATION SERVICES, LTD. ) DOCKET DOT-OST-2010-0190 * 

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

 ) 

for a Certificate of Public Convenience ) 

and Necessity (Interstate ) 

Scheduled Service) ) 

 ) 

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

FREEDOM AIR (Guam)) TO THE DEPARTMENT’S INFORMATION REQUEST 

Communications with respect to this document should be sent to: 

Gregory P. Cirillo 

Wiley Rein LLP 

7925 Jones Branch Drive 

McLean, Virginia 22102 

Ph: 703-905-2800 

Fx: 703-905-6701 

E: GCirillo@wileyrein.com 

September 28, 2010 

*/ A substantively identical Answer has been filed in the related docket DOT-OST-2010-0153 
1 

BEFORE THE 

DEPARTMENT OF TRANSPORTATION 

WASHINGTON, D.C. 

 ) 

Application of ) 

 ) 

AVIATION SERVICES, LTD. ) DOCKET DOT-OST-2010-0190 

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

 ) 

for a Certificate of Public Convenience ) 

and Necessity (Interstate ) 

Scheduled Service) ) 

 ) 

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

FREEDOM AIR (Guam)) TO THE DEPARTMENT’S INFORMATION REQUEST 

 On July 28, 2010, Aviation Services, Ltd. (d/b/a Freedom Air (Guam)) (“Freedom 

Air”) filed the above-captioned application for a determination of its fitness to conduct 

interstate scheduled air transportation. On July 14, 2010, Freedom Air filed a parallel 

application for a determination of its fitness to conduct foreign charter air transportation. 

See Docket DOT-OST-2010-0153. In connection with its foreign and interstate 

applications, on September 13, 2010, Freedom Air received an Information Request (see 

Exhibit A) from Vanessa R. Balgobin of the Department’s Air Carrier Fitness Division. 

 Freedom Air hereby submits the below information supplemented by Exhibits A – 

G in response to the Department’s Information Request (the “DOT-IR”). 

 

1. DOT-IR: The resume of Mr. James Gazley, indicates that he has some experience 

maintaining large aircraft. Please identify the type of large aircraft he has maintained. 

 The specific response is in the following paragraph. In general response to this 

question and the three that follow, as the Department knows, Freedom Air is pursuing a 

parallel process with the Federal Aviation Administration (“FAA”) to upgrade its Part 

121 certificate and operating specifications to permit the operation and maintenance of 

the B727 aircraft. This includes satisfying the FAA as to the employment and 

qualifications of persons satisfying the requirements of 14 C.F.R. Part 119 and otherwise 

necessary to support the operation of the B737 aircraft. As of today, Freedom Air is at 

various stages in the hiring process with the goal of hiring four (4) specialized 737 

mechanics and three (3) administrative support personnel for the 737 operations. In 

addition, current maintenance personnel at Freedom Air will attend specialized 737 
2 

training. Freedom Air is willing to provide specific updates, with confidential treatment 

as needed, as hiring progresses. 

 From November of 1993 to January of 1995, Mr. James Gazley worked for 

Pacific Island Aviation as a part time/weekend work assisting with line maintenance and 

servicing of a Kitty Hawk Boeing 727. Inferring that this question relates to Mr. 

Gazley’s expanded role resulting from the addition of 737 aircraft to the Freedom Air 

operating specifications, we note that in support of Mr. Gazley, Freedom Air is 

recruiting personnel specifically for the maintenance of that aircraft type. 

2. DOT-IR: With respect to the resume for Mr. James Jamison, please provide a 

detailed listing of all previous employment (both aviation and non-aviation) and 

education and training, including FAA certifications and license numbers if applicable. 

The employment listing should include the name of employer, location (city, state), type 

of business, position(s) held, description of responsibilities, and dates employed. 

Further, if the employer held any aviation authority, the type of authority held should be 

noted. 

See Exhibit B. Mr. James Jamison also has the following aviation training: 

- Air Training Center, Greeley, Colorado, July 1967 to January 1968 - Full time 

student; obtained Commercial, Single Engine Land and Certified Flight Instructor 

Instrument 

- University of Illinois, Champaign-Urbana, Illinois, 1969 (concurrent with 

instructor) - Part Time student; obtained multiengine rating 

- Burnside Ott Aviation Training Center, Miami, Florida, 1970 - Part time Student; 

obtained Airline Transport Rating (DC3 type) 

- Ag Rotors, Gettysburg, Pennsylvania, 1970 - Part time Student; obtained 

Commercial Helicopter followed by Helicopter Instructor 

- Received Single Engine Sea rating in Hibbing, Minnesota during a vacation in 

1969 

3. DOT-IR: Based on the resume submitted for Mr. Cardiff Walker, Chief Pilot, it 

does not appear that he has any experience operating large aircraft. Please discuss Mr. 

Walker’s qualifications for this position as it pertains to large aircraft operations. 

 Mr. Cardiff Walker is the current Chief Pilot at Freedom Air. Mr. Walker will 

continue to be the Chief Pilot for small aircraft operations. Freedom Air will recruit a 

qualified and trained Chief Pilot for the large aircraft (737) operations subject to receipt 

of DOT authority requested by the pending applications. 
3 

4. DOT-IR: Please indicate if any of Freedom Air’s current pilots are qualified to 

operate B737 aircraft. If not, please discuss the air carrier’s plans to hire qualified 

pilots or further train its current pilots. 

 Freedom Air’s current pilots are certified for the aircraft currently in the fleet, and 

none are currently qualified to operate B737 aircraft. Freedom Air has no plans to 

upgrade its current pilots into this operation (as they remain necessary for the existing 

operation), instead, Freedom Air will hire sixteen (16) trained and qualified pilots to 

operate B737 aircraft. Recruiting is underway and Freedom Air is willing to provide 

updates of this process upon request. 

5. DOT-IR: Please provide copies of all agreements between Freedom Air, WAI 

Asia, Ltd. (“WAI”), and Fly Micronesia Limited that have not yet been submitted to the 

Department. 

Since Freedom Air’s last filing, Freedom Air and Fly Micronesia Limited and 

entered into an Agreement extending and superseding the prior agreements governing 

their business relationship. See Exhibit C. 

6. DOT-IR: Please discuss Freedom Air’s plans for maintaining the B737 aircraft. 

Will aircraft maintenance be performed in-house, or will it be contracted out? If the 

maintenance will be contracted out, please indicate who will perform the maintenance. 

 The B737 aircraft will be maintained under a standard Boeing maintenance 

program, with scheduled and line maintenance allocated between qualified Freedom Air 

personnel and qualified third party contractors. For example, “A” checks, line 

maintenance, PDSC (Pre Departure Service Checks) and routine maintenance will likely 

be carried out by Freedom Air maintenance personnel for operations at the Guam base. 

Those procedures when undertaken at remote airports, in addition to “C” and further 

checks will be contracted to FAA approved facilities and personnel. Freedom Air has 

initiated negotiations with Hong Kong Aircraft Engineering Company Limited (HAECO) 

and with Air Asia in Taipei. 

 In any event, Freedom Air will provide maintenance only when it has qualified, 

trained and experienced personnel, the necessary equipment and facilities, and the FAA 

authorization to do so. 

7. DOT-IR: Provide a copy of any lease and/or sublease agreements for the B737 

aircraft Freedom Air intends to operate. 

 A fully executed copy of the Letter of Intent outlining the lease of two Boeing 

737s from Air Transport Acquisition Corp. (lessor) to Fly Micronesia (lessee) is attached 

as Exhibit D. The initial deposit referenced therein has been placed, and the definitive 
4 

lease agreement is under discussion. As with other 737-related commitments, Freedom 

Air is limited pending DOT action on the applications for authority. Fly Micronesia will 

enter into parallel subleases with Freedom Air. 

8. DOT-IR: Does WAI intend to market the foreign charter flights as “Freedom 

Air”? If not, please state the name under which the flights will be marketed. 

 Fly Micronesia Limited owns the rights to the trade name “Fly Guam” and is 

licensing that tradename to Freedom Air for purposes of the flights that are the subject of 

the applications (see Exhibit C, Section 2.3). Flights will be marketed and sold under the 

name “Fly Guam by Freedom Air” (as illustrated below), and such or similar livery will 

appear on the 737 aircraft. Freedom Air will obtain the necessary “d/b/a” authority and 

registrations with local authorities and the DOT. A registration pursuant to Part 215 of 

the Federal Aviation Regulation will be processed prior to any such use. 

9. DOT-IR: What percentage of Freedom Air’s annual revenues will come from 

business generated by WAI? 

 As set forth in Freedom Air’s Application for Foreign Passenger Charter 

Authority, Exhibit T-2, as confirmed in Exhibit C hereto, Section 2.3, Freedom Air will 

earn a fee equal to 1% of the gross revenue of planned jet operations by Freedom Air or 

US$12,000 per month, whichever is greater (beginning 6 months after the first 

commercial flight). 

 Based on current 2010 revenues, and assuming operations remained static for the 

future (without regard to the 737 operations), total annual revenues would be 

approximately $2.5 million (see Exhibit E). Freedom Air estimates gross monthly 

revenues from the B737 operations (excluding the first six months when Freedom Air 

will be paid the fixed $12,000 fee) will be between $4.0 million and $5.0 million in 2011 

(see Exhibit F), resulting in a fee to Freedom Air of $40,000 to $50,000 per month, or 

$480,000 to $600,000 per year. Therefore, approximately 19.2% to 24.0% of Freedom 

Air’s projected, annual revenue will come from business generated jointly by Freedom 

Air and WAI (Fly Micronesia). 
5 

10. DOT-IR: Freedom Air proposes to conduct interstate charter flights using larger 

aircraft, however, the applicant has not provided an operating proposal for such flights, 

nor has the applicant submitted forecast financial information. Provide such 

information. 

 Freedom Air intends to use the 737 aircraft primarily for charter operations 

between foreign countries and certain U.S. territories including Guam and the 

Commonwealth of Northern Mariana Islands (CNMI). The 737 operation is premised 

and is sustainable solely on the foreign charter activities described in the applications and 

financial forecasts. However, based on decades of prior experience, Freedom Air is 

aware of a periodic on-demand need for larger aircraft for charter service between and 

within the U.S. territories, and Freedom Air intends to opportunistically compete for this 

service as and when the demand arises and aircraft are available. Likely origins and 

destinations would include Guam, the CNMI (including Saipan, Rota and Tinian) and 

Hawaii. Freedom Air may elect to include some or all of these destinations as a part of 

its FAA operating specifications. Because interstate charter is to be pursued 

opportunistically, on a case-by-case basis, the financial forecasts do not ascribe any 

revenue or costs to this activity. 

 

11. DOT-IR: Please provide current (within 3 months) compiled balance sheets and 

income statements for Freedom Air. 

 A copy of Freedom Air’s compiled balance sheets and income statements for the 

period of March 2010 through June 2010 is attached as Exhibit E. 

12. DOT-IR: Freedom Air’s February 28, 2010 balance sheet shows a liability of 

$1.6 million due to “ASLtd-CNMI.” Please explain this liability. Also, state whether or 

not this is a current liability, that is, payable within the next 12 months. 

 Aviation Services (CNMI), Ltd., a CNMI entity, (identified in the February 28, 

2010 balance sheet as “ASLtd-CNMI”) is a corporate entity that is a “sister” company 

that is under common control with Freedom Air. Mr. Joaquin Flores holds a controlling 

interest in both entities. There is an internal, long term liability accrued between 

Freedom Air and Aviation Services (CNMI), Ltd. This liability has no fixed payment 

schedule and no specific maturity date; accordingly, it is not payable within the next 

twelve (12) months. 

13. DOT-IR: The forecast financial information that Freedom Air provided is 

somewhat unclear. Please provide a revised forecast of the air carrier’s first year 

expenses associated with its large aircraft operation, by month, showing each expense 

category, such as fuel, maintenance, salaries, etc. Further, this information should be 

broken down between interstate and foreign charter operations. 

 See Exhibit F. 
6 

14. DOT-IR: Please identify which of the pre-operating costs have been paid to date 

and which costs remain outstanding. 

 See Exhibit G. 

13196086.1 

 



FA EXHIBIT A 




FA EXHIBIT B 
114 Gloria Way, Yona, Guam 96915 ● +1-671-472-8007 James Jamison 

Aviation Certificates

• Airline Transport Pilot 

Certificate #1797337

• Aircraft Dispatcher 

#1797337

• Flight Attendant 

#3011003

• Ground Instructor 

#1837476

Other Certificates

• American Red Cross 

Instructor

Education

1972 Master of Arts 

University of 

Illinois

1965 Bachelor of Arts

Cornell College

Also Attended:

• American University

• University of Guam

EMPLOYMENT HISTORY

1990 to present

Aviation Services Ltd. (D/B/A Freedom Air, FAR 121 and 135 Airlines)

Guam International Airport, Tamuning, Guam

• Line Pilot/Chief Pilot/Director of Operations

Directed airlines operations in accordance with requirements of FAR 119

and company procedures

1993 to 1998

Guam Department of Education (concurrent with Freedom Air)

Hagatna, Guam

• School Teacher

Administered Classroom

1987 to 1990

Guam Marianas Airway (FAR 135 Scheduled Airline)

Guam International Airport, Tamuning, Guam

• Line Pilot/Director of Operations

Assisted with start-up of airline and managed operations

1985 to 1987

Air Guam (FAR 135 Scheduled Airline)

Guam International Airport, Tamuning, Guam

• Pilot/Director of Operations

Assisted with start-up of airline and managed operations

1983 to 1985

Guam Department of Education

Hagatna, Guam 

• School Teacher

Administered Classroom

1981 to 1983

Pacific Island Aviation (FAR 121 and 135 Airline)s

Guam International Airport, Tamuning, Guam

• Line Pilot/Chief Pilot

Assisted with merger of airline and Chief Pilot duties

1980 to 1981

TransMicronesia Airways

Guam International Airport, Tamuning, Guam

FAR 135 Airline

• Line Pilot/Director of Operations

Line Pilot duties then appointed to Director of Operations
114 Gloria Way, Yona, Guam 96915 ● +1-671-472-8007 James Jamison 

EMPLOYMENT HISTORY (continued from previous page, Page 1)

1977 to 1979

General Aviation Services

Mbabane, Swaziland

• Pilot

Line Co-pilot duties

1977 to 1979 (concurrent with General Aviation Services)

Manzini Department of Education

Mbabane, Swaziland

• School Teacher

Administered a classroom

1975 to 1976

Alaska Aeronautical (FAR 135 Scheduled Airlines)

Anchorage, Alaska

• Pilot

Line Co-pilot duties

1972 to 1975

Marist International School

Kobe, Japan

• School Teacher

Administered classroom

1968 to 1972

University of Illinois – Institute of Aviation

Champaign, Illinois

• Instructor

Administered classroom and part-time research

1965 to 1967

U.S. Army

(varied locations)

• Soldier

As per the U.S. Army basic duties: obedience to orders, performance as 

assigned, teamwork, appearance and oath to support and defend the 

Constitution of the United States against all enemies, foreign and domestic
FA EXHIBIT C 












FA EXHIBIT D 







FA EXHIBIT E 


FA EXHIBIT F 
20/9/2010

Revised by: Charles Tse

Freedom Air Forecast Income Statement and Operating Assumptions (USD)

(All countries)

Total

Weekly Block Hours 144.33 144.33 144.33 144.33 144.33 144.33 144.33 144.33 144.33 144.33 144.33 144.33 144.33 144.33

Weeks during the month (Revenue) 2.00 5.00 5.00 3.20 4.50 4.00 4.25 5.00 4.00 5.00 4.50 4.00 4.25 5.00 59.70

First 13.5 months

Revenue 15-30 Nov 10 Dec-10 Jan-11 Feb-11 Mar-11 Apr-11 May-11 Jun-11 Jul-11 Aug-11 Sep-11 Oct-11 Nov-11 Dec-11 of Operation

Estimated Y seats Revenue per wk 1,728,000.00 4,320,000.00 4,320,000.00 2,764,800.00 3,888,000.00 3,456,000.00 3,672,000.00 4,320,000.00 3,456,000.00 4,320,000.00 3,888,000.00 3,456,000.00 3,672,000.00 4,320,000.00 51,580,800.00

Estimated F seats Revenue per wk 286,000.00 715,000.00 715,000.00 457,600.00 643,500.00 572,000.00 607,750.00 715,000.00 572,000.00 715,000.00 643,500.00 572,000.00 607,750.00 715,000.00 8,537,100.00

Total Estimated Revenue 2,014,000.00 5,035,000.00 5,035,000.00 3,222,400.00 4,531,500.00 4,028,000.00 4,279,750.00 5,035,000.00 4,028,000.00 5,035,000.00 4,531,500.00 4,028,000.00 4,279,750.00 5,035,000.00 60,117,900.00

Weeks during the month (Cost) 2.00 5.00 5.00 4.00 5.00 4.00 5.00 5.00 4.00 5.00 5.00 4.00 5.00 5.00 63.00

Operating Expenses Per Block Hour

Aircraft Leasing 377.00 108,827.33 272,068.33 272,068.33 217,654.67 272,068.33 217,654.67 272,068.33 272,068.33 217,654.67 272,068.33 272,068.33 217,654.67 272,068.33 272,068.33 3,428,061.00

Direct Maintenance - Airframe 1,190.00 343,513.33 858,783.33 858,783.33 687,026.67 858,783.33 687,026.67 858,783.33 858,783.33 687,026.67 858,783.33 858,783.33 687,026.67 858,783.33 858,783.33 10,820,670.00

Direct Maintenance - Engines 191.00 55,135.33 137,838.33 137,838.33 110,270.67 137,838.33 110,270.67 137,838.33 137,838.33 110,270.67 137,838.33 137,838.33 110,270.67 137,838.33 137,838.33 1,736,763.00

Flight Crew Cost 546.00 157,612.00 394,030.00 394,030.00 315,224.00 394,030.00 315,224.00 394,030.00 394,030.00 315,224.00 394,030.00 394,030.00 315,224.00 394,030.00 394,030.00 4,964,778.00

Fuel Cost 1,800.00 519,600.00 1,299,000.00 1,299,000.00 1,039,200.00 1,299,000.00 1,039,200.00 1,299,000.00 1,299,000.00 1,039,200.00 1,299,000.00 1,299,000.00 1,039,200.00 1,299,000.00 1,299,000.00 16,367,400.00

Ground Handling 430.00 124,126.67 310,316.67 310,316.67 248,253.33 310,316.67 248,253.33 310,316.67 310,316.67 248,253.33 310,316.67 310,316.67 248,253.33 310,316.67 310,316.67 3,909,990.00

Inflight and Catering 480.00 138,560.00 346,400.00 346,400.00 277,120.00 346,400.00 277,120.00 346,400.00 346,400.00 277,120.00 346,400.00 346,400.00 277,120.00 346,400.00 346,400.00 4,364,640.00

Ins 136.00 39,258.67 98,146.67 98,146.67 78,517.33 98,146.67 78,517.33 98,146.67 98,146.67 78,517.33 98,146.67 98,146.67 78,517.33 98,146.67 98,146.67 1,236,648.00

Landing / Parking 365.00 105,363.33 263,408.33 263,408.33 210,726.67 263,408.33 210,726.67 263,408.33 263,408.33 210,726.67 263,408.33 263,408.33 210,726.67 263,408.33 263,408.33 3,318,945.00

Total Operating Expenses 5,515.00 1,591,996.67 3,979,991.67 3,979,991.67 3,183,993.33 3,979,991.67 3,183,993.33 3,979,991.67 3,979,991.67 3,183,993.33 3,979,991.67 3,979,991.67 3,183,993.33 3,979,991.67 3,979,991.67 50,147,895.00

Selling, General and Adminstrative Expenses

Administrative costs 71.70 20,697.40 51,743.50 51,743.50 41,394.80 51,743.50 41,394.80 51,743.50 51,743.50 41,394.80 51,743.50 51,743.50 41,394.80 51,743.50 51,743.50 651,968.10

Overhead (Staffs, Rental) 330.90 95,519.80 238,799.50 238,799.50 191,039.60 238,799.50 191,039.60 238,799.50 238,799.50 191,039.60 238,799.50 238,799.50 191,039.60 238,799.50 238,799.50 3,008,873.70

Sales Cost 204.05 58,902.43 147,256.08 147,256.08 117,804.87 147,256.08 117,804.87 147,256.08 147,256.08 117,804.87 147,256.08 147,256.08 117,804.87 147,256.08 147,256.08 1,855,426.65

Total Selling, General and Admin. Expenses 606.65 175,119.63 437,799.08 437,799.08 350,239.27 437,799.08 350,239.27 437,799.08 437,799.08 350,239.27 437,799.08 437,799.08 350,239.27 437,799.08 437,799.08 5,516,268.45

Total Expenses 6,121.65 1,767,116.30 4,417,790.75 4,417,790.75 3,534,232.60 4,417,790.75 3,534,232.60 4,417,790.75 4,417,790.75 3,534,232.60 4,417,790.75 4,417,790.75 3,534,232.60 4,417,790.75 4,417,790.75 55,664,163.45

Gross Profit / (Loss) 246,883.70 617,209.25 617,209.25 (311,832.60) 113,709.25 493,767.40 (138,040.75) 617,209.25 493,767.40 617,209.25 113,709.25 493,767.40 (138,040.75) 617,209.25 4,453,736.55
20/9/2010

Revised by: Charles Tse

Freedom Air Forecast Income Statement and Operating Assumptions (USD)

(GUM - ROR)

Total

Weekly Block Hours 11.50 11.50 11.50 11.50 11.50 11.50 11.50 11.50 11.50 11.50 11.50 11.50 11.50 11.50

Weeks during the month (Revenue) 2.00 5.00 5.00 3.20 4.50 4.00 4.25 5.00 4.00 5.00 4.50 4.00 4.25 5.00 59.70

First 13.5 months

Revenue 15-30 Nov 10 Dec-10 Jan-11 Feb-11 Mar-11 Apr-11 May-11 Jun-11 Jul-11 Aug-11 Sep-11 Oct-11 Nov-11 Dec-11 of Operation

Y-Seats (112 seats)

Revenue per seat A 600.00

Estimate load B 90.00

Revenue per flight C = A x B 54,000.00

Weekly Freq. D 3.00

Estimated Y seats Revenue per wk E = C x D 162,000.00 324,000.00 810,000.00 810,000.00 518,400.00 729,000.00 648,000.00 688,500.00 810,000.00 648,000.00 810,000.00 729,000.00 648,000.00 688,500.00 810,000.00 9,671,400.00

F-Seats (12 seats)

Revenue per seat F 1,100.00

Estimate load G 5.00

Revenue per flight H = F x G 5,500.00

Weekly Freq. I 3.00

Estimated F seats Revenue per wk J = H x I 16,500.00 33,000.00 82,500.00 82,500.00 52,800.00 74,250.00 66,000.00 70,125.00 82,500.00 66,000.00 82,500.00 74,250.00 66,000.00 70,125.00 82,500.00 985,050.00

Total Estimated Revenue 178,500.00 357,000.00 892,500.00 892,500.00 571,200.00 803,250.00 714,000.00 758,625.00 892,500.00 714,000.00 892,500.00 803,250.00 714,000.00 758,625.00 892,500.00 10,656,450.00

Weeks during the month (Cost) 2.00 5.00 5.00 4.00 5.00 4.00 5.00 5.00 4.00 5.00 5.00 4.00 5.00 5.00 63.00

Operating Expenses Per Block Hour

Aircraft Leasing 377.00 8,671.00 21,677.50 21,677.50 17,342.00 21,677.50 17,342.00 21,677.50 21,677.50 17,342.00 21,677.50 21,677.50 17,342.00 21,677.50 21,677.50 273,136.50

Direct Maintenance - Airframe 1,190.00 27,370.00 68,425.00 68,425.00 54,740.00 68,425.00 54,740.00 68,425.00 68,425.00 54,740.00 68,425.00 68,425.00 54,740.00 68,425.00 68,425.00 862,155.00

Direct Maintenance - Engines 191.00 4,393.00 10,982.50 10,982.50 8,786.00 10,982.50 8,786.00 10,982.50 10,982.50 8,786.00 10,982.50 10,982.50 8,786.00 10,982.50 10,982.50 138,379.50

Flight Crew Cost 546.00 12,558.00 31,395.00 31,395.00 25,116.00 31,395.00 25,116.00 31,395.00 31,395.00 25,116.00 31,395.00 31,395.00 25,116.00 31,395.00 31,395.00 395,577.00

Fuel Cost 1,800.00 41,400.00 103,500.00 103,500.00 82,800.00 103,500.00 82,800.00 103,500.00 103,500.00 82,800.00 103,500.00 103,500.00 82,800.00 103,500.00 103,500.00 1,304,100.00

Ground Handling 430.00 9,890.00 24,725.00 24,725.00 19,780.00 24,725.00 19,780.00 24,725.00 24,725.00 19,780.00 24,725.00 24,725.00 19,780.00 24,725.00 24,725.00 311,535.00

Inflight and Catering 480.00 11,040.00 27,600.00 27,600.00 22,080.00 27,600.00 22,080.00 27,600.00 27,600.00 22,080.00 27,600.00 27,600.00 22,080.00 27,600.00 27,600.00 347,760.00

Ins 136.00 3,128.00 7,820.00 7,820.00 6,256.00 7,820.00 6,256.00 7,820.00 7,820.00 6,256.00 7,820.00 7,820.00 6,256.00 7,820.00 7,820.00 98,532.00

Landing / Parking 365.00 8,395.00 20,987.50 20,987.50 16,790.00 20,987.50 16,790.00 20,987.50 20,987.50 16,790.00 20,987.50 20,987.50 16,790.00 20,987.50 20,987.50 264,442.50

Total Operating Expenses 5,515.00 126,845.00 317,112.50 317,112.50 253,690.00 317,112.50 253,690.00 317,112.50 317,112.50 253,690.00 317,112.50 317,112.50 253,690.00 317,112.50 317,112.50 3,995,617.50

Selling, General and Adminstrative Expenses

Administrative costs 71.70 1,649.10 4,122.75 4,122.75 3,298.20 4,122.75 3,298.20 4,122.75 4,122.75 3,298.20 4,122.75 4,122.75 3,298.20 4,122.75 4,122.75 51,946.65

Overhead (Staffs, Rental) 330.90 7,610.70 19,026.75 19,026.75 15,221.40 19,026.75 15,221.40 19,026.75 19,026.75 15,221.40 19,026.75 19,026.75 15,221.40 19,026.75 19,026.75 239,737.05

Sales Cost 204.05 4,693.15 11,732.88 11,732.88 9,386.30 11,732.88 9,386.30 11,732.88 11,732.88 9,386.30 11,732.88 11,732.88 9,386.30 11,732.88 11,732.88 147,834.23

Total Selling, General and Admin. Expenses 606.65 13,952.95 34,882.38 34,882.38 27,905.90 34,882.38 27,905.90 34,882.38 34,882.38 27,905.90 34,882.38 34,882.38 27,905.90 34,882.38 34,882.38 439,517.93

Total Expenses 6,121.65 140,797.95 351,994.88 351,994.88 281,595.90 351,994.88 281,595.90 351,994.88 351,994.88 281,595.90 351,994.88 351,994.88 281,595.90 351,994.88 351,994.88 4,435,135.43

Gross Profit / (Loss) 216,202.05 540,505.13 540,505.13 289,604.10 451,255.13 432,404.10 406,630.13 540,505.13 432,404.10 540,505.13 451,255.13 432,404.10 406,630.13 540,505.13 6,221,314.58
20/9/2010

Revised by: Charles Tse

Freedom Air Forecast Income Statement and Operating Assumptions (USD)

(GUM - HND)

Total

Weekly Block Hours 18.00 18.00 18.00 18.00 18.00 18.00 18.00 18.00 18.00 18.00 18.00 18.00 18.00 18.00

Weeks during the month (Revenue) 2.00 5.00 5.00 3.20 4.50 4.00 4.25 5.00 4.00 5.00 4.50 4.00 4.25 5.00 59.70

First 13.5 months

Revenue 15-30 Nov 10 Dec-10 Jan-11 Feb-11 Mar-11 Apr-11 May-11 Jun-11 Jul-11 Aug-11 Sep-11 Oct-11 Nov-11 Dec-11 of Operation

Y-Seats (112 seats)

Revenue per seat A 400.00

Estimate load B 90.00

Revenue per flight C = A x B 36,000.00

Weekly Freq. D 3.00

Estimated Y seats Revenue per wk E = C x D 108,000.00 216,000.00 540,000.00 540,000.00 345,600.00 486,000.00 432,000.00 459,000.00 540,000.00 432,000.00 540,000.00 486,000.00 432,000.00 459,000.00 540,000.00 6,447,600.00

F-Seats (12 seats)

Revenue per seat F 2,000.00

Estimate load G 5.00

Revenue per flight H = F x G 10,000.00

Weekly Freq. I 3.00

Estimated F seats Revenue per wk J = H x I 30,000.00 60,000.00 150,000.00 150,000.00 96,000.00 135,000.00 120,000.00 127,500.00 150,000.00 120,000.00 150,000.00 135,000.00 120,000.00 127,500.00 150,000.00 1,791,000.00

Total Estimated Revenue 138,000.00 276,000.00 690,000.00 690,000.00 441,600.00 621,000.00 552,000.00 586,500.00 690,000.00 552,000.00 690,000.00 621,000.00 552,000.00 586,500.00 690,000.00 8,238,600.00

Weeks during the month (Cost) 2.00 5.00 5.00 4.00 5.00 4.00 5.00 5.00 4.00 5.00 5.00 4.00 5.00 5.00 63.00

Operating Expenses Per Block Hour

Aircraft Leasing 377.00 13,572.00 33,930.00 33,930.00 27,144.00 33,930.00 27,144.00 33,930.00 33,930.00 27,144.00 33,930.00 33,930.00 27,144.00 33,930.00 33,930.00 427,518.00

Direct Maintenance - Airframe 1,190.00 42,840.00 107,100.00 107,100.00 85,680.00 107,100.00 85,680.00 107,100.00 107,100.00 85,680.00 107,100.00 107,100.00 85,680.00 107,100.00 107,100.00 1,349,460.00

Direct Maintenance - Engines 191.00 6,876.00 17,190.00 17,190.00 13,752.00 17,190.00 13,752.00 17,190.00 17,190.00 13,752.00 17,190.00 17,190.00 13,752.00 17,190.00 17,190.00 216,594.00

Flight Crew Cost 546.00 19,656.00 49,140.00 49,140.00 39,312.00 49,140.00 39,312.00 49,140.00 49,140.00 39,312.00 49,140.00 49,140.00 39,312.00 49,140.00 49,140.00 619,164.00

Fuel Cost 1,800.00 64,800.00 162,000.00 162,000.00 129,600.00 162,000.00 129,600.00 162,000.00 162,000.00 129,600.00 162,000.00 162,000.00 129,600.00 162,000.00 162,000.00 2,041,200.00

Ground Handling 430.00 15,480.00 38,700.00 38,700.00 30,960.00 38,700.00 30,960.00 38,700.00 38,700.00 30,960.00 38,700.00 38,700.00 30,960.00 38,700.00 38,700.00 487,620.00

Inflight and Catering 480.00 17,280.00 43,200.00 43,200.00 34,560.00 43,200.00 34,560.00 43,200.00 43,200.00 34,560.00 43,200.00 43,200.00 34,560.00 43,200.00 43,200.00 544,320.00

Ins 136.00 4,896.00 12,240.00 12,240.00 9,792.00 12,240.00 9,792.00 12,240.00 12,240.00 9,792.00 12,240.00 12,240.00 9,792.00 12,240.00 12,240.00 154,224.00

Landing / Parking 365.00 13,140.00 32,850.00 32,850.00 26,280.00 32,850.00 26,280.00 32,850.00 32,850.00 26,280.00 32,850.00 32,850.00 26,280.00 32,850.00 32,850.00 413,910.00

Total Operating Expenses 5,515.00 198,540.00 496,350.00 496,350.00 397,080.00 496,350.00 397,080.00 496,350.00 496,350.00 397,080.00 496,350.00 496,350.00 397,080.00 496,350.00 496,350.00 6,254,010.00

Selling, General and Adminstrative Expenses

Administrative costs 71.70 2,581.20 6,453.00 6,453.00 5,162.40 6,453.00 5,162.40 6,453.00 6,453.00 5,162.40 6,453.00 6,453.00 5,162.40 6,453.00 6,453.00 81,307.80

Overhead (Staffs, Rental) 330.90 11,912.40 29,781.00 29,781.00 23,824.80 29,781.00 23,824.80 29,781.00 29,781.00 23,824.80 29,781.00 29,781.00 23,824.80 29,781.00 29,781.00 375,240.60

Sales Cost 204.05 7,345.80 18,364.50 18,364.50 14,691.60 18,364.50 14,691.60 18,364.50 18,364.50 14,691.60 18,364.50 18,364.50 14,691.60 18,364.50 18,364.50 231,392.70

Total Selling, General and Admin. Expenses 606.65 21,839.40 54,598.50 54,598.50 43,678.80 54,598.50 43,678.80 54,598.50 54,598.50 43,678.80 54,598.50 54,598.50 43,678.80 54,598.50 54,598.50 687,941.10

Total Expenses 6,121.65 220,379.40 550,948.50 550,948.50 440,758.80 550,948.50 440,758.80 550,948.50 550,948.50 440,758.80 550,948.50 550,948.50 440,758.80 550,948.50 550,948.50 6,941,951.10

Gross Profit / (Loss) 55,620.60 139,051.50 139,051.50 841.20 70,051.50 111,241.20 35,551.50 139,051.50 111,241.20 139,051.50 70,051.50 111,241.20 35,551.50 139,051.50 1,296,648.90
20/9/2010

Revised by: Charles Tse

Freedom Air Forecast Income Statement and Operating Assumptions (USD)

(GUM - SHA)

Total

Weekly Block Hours 28.00 28.00 28.00 28.00 28.00 28.00 28.00 28.00 28.00 28.00 28.00 28.00 28.00 28.00

Weeks during the month (Revenue) 2.00 5.00 5.00 3.20 4.50 4.00 4.25 5.00 4.00 5.00 4.50 4.00 4.25 5.00 59.70

First 13.5 months

Revenue 15-30 Nov 10 Dec-10 Jan-11 Feb-11 Mar-11 Apr-11 May-11 Jun-11 Jul-11 Aug-11 Sep-11 Oct-11 Nov-11 Dec-11 of Operation

Y-Seats (112 seats)

Revenue per seat A 600.00

Estimate load B 90.00

Revenue per flight C = A x B 54,000.00

Weekly Freq. D 3.00

Estimated Y seats Revenue per wk E = C x D 162,000.00 324,000.00 810,000.00 810,000.00 518,400.00 729,000.00 648,000.00 688,500.00 810,000.00 648,000.00 810,000.00 729,000.00 648,000.00 688,500.00 810,000.00 9,671,400.00

F-Seats (12 seats)

Revenue per seat F 1,900.00

Estimate load G 5.00

Revenue per flight H = F x G 9,500.00

Weekly Freq. I 3.00

Estimated F seats Revenue per wk J = H x I 28,500.00 57,000.00 142,500.00 142,500.00 91,200.00 128,250.00 114,000.00 121,125.00 142,500.00 114,000.00 142,500.00 128,250.00 114,000.00 121,125.00 142,500.00 1,701,450.00

Total Estimated Revenue 190,500.00 381,000.00 952,500.00 952,500.00 609,600.00 857,250.00 762,000.00 809,625.00 952,500.00 762,000.00 952,500.00 857,250.00 762,000.00 809,625.00 952,500.00 11,372,850.00

Weeks during the month (Cost) 2.00 5.00 5.00 4.00 5.00 4.00 5.00 5.00 4.00 5.00 5.00 4.00 5.00 5.00 63.00

Operating Expenses Per Block Hour

Aircraft Leasing 377.00 21,112.00 52,780.00 52,780.00 42,224.00 52,780.00 42,224.00 52,780.00 52,780.00 42,224.00 52,780.00 52,780.00 42,224.00 52,780.00 52,780.00 665,028.00

Direct Maintenance - Airframe 1,190.00 66,640.00 166,600.00 166,600.00 133,280.00 166,600.00 133,280.00 166,600.00 166,600.00 133,280.00 166,600.00 166,600.00 133,280.00 166,600.00 166,600.00 2,099,160.00

Direct Maintenance - Engines 191.00 10,696.00 26,740.00 26,740.00 21,392.00 26,740.00 21,392.00 26,740.00 26,740.00 21,392.00 26,740.00 26,740.00 21,392.00 26,740.00 26,740.00 336,924.00

Flight Crew Cost 546.00 30,576.00 76,440.00 76,440.00 61,152.00 76,440.00 61,152.00 76,440.00 76,440.00 61,152.00 76,440.00 76,440.00 61,152.00 76,440.00 76,440.00 963,144.00

Fuel Cost 1,800.00 100,800.00 252,000.00 252,000.00 201,600.00 252,000.00 201,600.00 252,000.00 252,000.00 201,600.00 252,000.00 252,000.00 201,600.00 252,000.00 252,000.00 3,175,200.00

Ground Handling 430.00 24,080.00 60,200.00 60,200.00 48,160.00 60,200.00 48,160.00 60,200.00 60,200.00 48,160.00 60,200.00 60,200.00 48,160.00 60,200.00 60,200.00 758,520.00

Inflight and Catering 480.00 26,880.00 67,200.00 67,200.00 53,760.00 67,200.00 53,760.00 67,200.00 67,200.00 53,760.00 67,200.00 67,200.00 53,760.00 67,200.00 67,200.00 846,720.00

Ins 136.00 7,616.00 19,040.00 19,040.00 15,232.00 19,040.00 15,232.00 19,040.00 19,040.00 15,232.00 19,040.00 19,040.00 15,232.00 19,040.00 19,040.00 239,904.00

Landing / Parking 365.00 20,440.00 51,100.00 51,100.00 40,880.00 51,100.00 40,880.00 51,100.00 51,100.00 40,880.00 51,100.00 51,100.00 40,880.00 51,100.00 51,100.00 643,860.00

Total Operating Expenses 5,515.00 308,840.00 772,100.00 772,100.00 617,680.00 772,100.00 617,680.00 772,100.00 772,100.00 617,680.00 772,100.00 772,100.00 617,680.00 772,100.00 772,100.00 9,728,460.00

Selling, General and Adminstrative Expenses

Administrative costs 71.70 4,015.20 10,038.00 10,038.00 8,030.40 10,038.00 8,030.40 10,038.00 10,038.00 8,030.40 10,038.00 10,038.00 8,030.40 10,038.00 10,038.00 126,478.80

Overhead (Staffs, Rental) 330.90 18,530.40 46,326.00 46,326.00 37,060.80 46,326.00 37,060.80 46,326.00 46,326.00 37,060.80 46,326.00 46,326.00 37,060.80 46,326.00 46,326.00 583,707.60

Sales Cost 204.05 11,426.80 28,567.00 28,567.00 22,853.60 28,567.00 22,853.60 28,567.00 28,567.00 22,853.60 28,567.00 28,567.00 22,853.60 28,567.00 28,567.00 359,944.20

Total Selling, General and Admin. Expenses 606.65 33,972.40 84,931.00 84,931.00 67,944.80 84,931.00 67,944.80 84,931.00 84,931.00 67,944.80 84,931.00 84,931.00 67,944.80 84,931.00 84,931.00 1,070,130.60

Total Expenses 6,121.65 342,812.40 857,031.00 857,031.00 685,624.80 857,031.00 685,624.80 857,031.00 857,031.00 685,624.80 857,031.00 857,031.00 685,624.80 857,031.00 857,031.00 10,798,590.60

Gross Profit / (Loss) 38,187.60 95,469.00 95,469.00 (76,024.80) 219.00 76,375.20 (47,406.00) 95,469.00 76,375.20 95,469.00 219.00 76,375.20 (47,406.00) 95,469.00 574,259.40
20/9/2010

Revised by: Charles Tse

Freedom Air Forecast Income Statement and Operating Assumptions (USD)

(GUM - TPE)

Total

Weekly Block Hours 21.50 21.50 21.50 21.50 21.50 21.50 21.50 21.50 21.50 21.50 21.50 21.50 21.50 21.50

Weeks during the month (Revenue) 2.00 5.00 5.00 3.20 4.50 4.00 4.25 5.00 4.00 5.00 4.50 4.00 4.25 5.00 59.70

First 13.5 months

Revenue 15-30 Nov 10 Dec-10 Jan-11 Feb-11 Mar-11 Apr-11 May-11 Jun-11 Jul-11 Aug-11 Sep-11 Oct-11 Nov-11 Dec-11 of Operation

Y-Seats (112 seats)

Revenue per seat A 400.00

Estimate load B 90.00

Revenue per flight C = A x B 36,000.00

Weekly Freq. D 3.00

Estimated Y seats Revenue per wk E = C x D 108,000.00 216,000.00 540,000.00 540,000.00 345,600.00 486,000.00 432,000.00 459,000.00 540,000.00 432,000.00 540,000.00 486,000.00 432,000.00 459,000.00 540,000.00 6,447,600.00

F-Seats (12 seats)

Revenue per seat F 1,800.00

Estimate load G 5.00

Revenue per flight H = F x G 9,000.00

Weekly Freq. I 3.00

Estimated F seats Revenue per wk J = H x I 27,000.00 54,000.00 135,000.00 135,000.00 86,400.00 121,500.00 108,000.00 114,750.00 135,000.00 108,000.00 135,000.00 121,500.00 108,000.00 114,750.00 135,000.00 1,611,900.00

Total Estimated Revenue 135,000.00 270,000.00 675,000.00 675,000.00 432,000.00 607,500.00 540,000.00 573,750.00 675,000.00 540,000.00 675,000.00 607,500.00 540,000.00 573,750.00 675,000.00 8,059,500.00

Weeks during the month (Cost) 2.00 5.00 5.00 4.00 5.00 4.00 5.00 5.00 4.00 5.00 5.00 4.00 5.00 5.00 63.00

Operating Expenses Per Block Hour

Aircraft Leasing 377.00 16,211.00 40,527.50 40,527.50 32,422.00 40,527.50 32,422.00 40,527.50 40,527.50 32,422.00 40,527.50 40,527.50 32,422.00 40,527.50 40,527.50 510,646.50

Direct Maintenance - Airframe 1,190.00 51,170.00 127,925.00 127,925.00 102,340.00 127,925.00 102,340.00 127,925.00 127,925.00 102,340.00 127,925.00 127,925.00 102,340.00 127,925.00 127,925.00 1,611,855.00

Direct Maintenance - Engines 191.00 8,213.00 20,532.50 20,532.50 16,426.00 20,532.50 16,426.00 20,532.50 20,532.50 16,426.00 20,532.50 20,532.50 16,426.00 20,532.50 20,532.50 258,709.50

Flight Crew Cost 546.00 23,478.00 58,695.00 58,695.00 46,956.00 58,695.00 46,956.00 58,695.00 58,695.00 46,956.00 58,695.00 58,695.00 46,956.00 58,695.00 58,695.00 739,557.00

Fuel Cost 1,800.00 77,400.00 193,500.00 193,500.00 154,800.00 193,500.00 154,800.00 193,500.00 193,500.00 154,800.00 193,500.00 193,500.00 154,800.00 193,500.00 193,500.00 2,438,100.00

Ground Handling 430.00 18,490.00 46,225.00 46,225.00 36,980.00 46,225.00 36,980.00 46,225.00 46,225.00 36,980.00 46,225.00 46,225.00 36,980.00 46,225.00 46,225.00 582,435.00

Inflight and Catering 480.00 20,640.00 51,600.00 51,600.00 41,280.00 51,600.00 41,280.00 51,600.00 51,600.00 41,280.00 51,600.00 51,600.00 41,280.00 51,600.00 51,600.00 650,160.00

Ins 136.00 5,848.00 14,620.00 14,620.00 11,696.00 14,620.00 11,696.00 14,620.00 14,620.00 11,696.00 14,620.00 14,620.00 11,696.00 14,620.00 14,620.00 184,212.00

Landing / Parking 365.00 15,695.00 39,237.50 39,237.50 31,390.00 39,237.50 31,390.00 39,237.50 39,237.50 31,390.00 39,237.50 39,237.50 31,390.00 39,237.50 39,237.50 494,392.50

Total Operating Expenses 5,515.00 237,145.00 592,862.50 592,862.50 474,290.00 592,862.50 474,290.00 592,862.50 592,862.50 474,290.00 592,862.50 592,862.50 474,290.00 592,862.50 592,862.50 7,470,067.50

Selling, General and Adminstrative Expenses

Administrative costs 71.70 3,083.10 7,707.75 7,707.75 6,166.20 7,707.75 6,166.20 7,707.75 7,707.75 6,166.20 7,707.75 7,707.75 6,166.20 7,707.75 7,707.75 97,117.65

Overhead (Staffs, Rental) 330.90 14,228.70 35,571.75 35,571.75 28,457.40 35,571.75 28,457.40 35,571.75 35,571.75 28,457.40 35,571.75 35,571.75 28,457.40 35,571.75 35,571.75 448,204.05

Sales Cost 204.05 8,774.15 21,935.38 21,935.38 17,548.30 21,935.38 17,548.30 21,935.38 21,935.38 17,548.30 21,935.38 21,935.38 17,548.30 21,935.38 21,935.38 276,385.73

Total Selling, General and Admin. Expenses 606.65 26,085.95 65,214.88 65,214.88 52,171.90 65,214.88 52,171.90 65,214.88 65,214.88 52,171.90 65,214.88 65,214.88 52,171.90 65,214.88 65,214.88 821,707.43

Total Expenses 6,121.65 263,230.95 658,077.38 658,077.38 526,461.90 658,077.38 526,461.90 658,077.38 658,077.38 526,461.90 658,077.38 658,077.38 526,461.90 658,077.38 658,077.38 8,291,774.93

Gross Profit / (Loss) 6,769.05 16,922.63 16,922.63 (94,461.90) (50,577.38) 13,538.10 (84,327.38) 16,922.63 13,538.10 16,922.63 (50,577.38) 13,538.10 (84,327.38) 16,922.63 (232,274.93)
20/9/2010

Revised by: Charles Tse

Freedom Air Forecast Income Statement and Operating Assumptions (USD)

(GUM - HKG)

Total

Weekly Block Hours 36.00 36.00 36.00 36.00 36.00 36.00 36.00 36.00 36.00 36.00 36.00 36.00 36.00 36.00

Weeks during the month (Revenue) 2.00 5.00 5.00 3.20 4.50 4.00 4.25 5.00 4.00 5.00 4.50 4.00 4.25 5.00 59.70

First 13.5 months

Revenue 15-30 Nov 10 Dec-10 Jan-11 Feb-11 Mar-11 Apr-11 May-11 Jun-11 Jul-11 Aug-11 Sep-11 Oct-11 Nov-11 Dec-11 of Operation

Y-Seats (112 seats)

Revenue per seat A 500.00

Estimate load B 90.00

Revenue per flight C = A x B 45,000.00

Weekly Freq. D 4.00

Estimated Y seats Revenue per wk E = C x D 180,000.00 360,000.00 900,000.00 900,000.00 576,000.00 810,000.00 720,000.00 765,000.00 900,000.00 720,000.00 900,000.00 810,000.00 720,000.00 765,000.00 900,000.00 10,746,000.00

F-Seats (12 seats)

Revenue per seat F 1,100.00

Estimate load G 5.00

Revenue per flight H = F x G 5,500.00

Weekly Freq. I 4.00

Estimated F seats Revenue per wk J = H x I 22,000.00 44,000.00 110,000.00 110,000.00 70,400.00 99,000.00 88,000.00 93,500.00 110,000.00 88,000.00 110,000.00 99,000.00 88,000.00 93,500.00 110,000.00 1,313,400.00

Total Estimated Revenue 202,000.00 404,000.00 1,010,000.00 1,010,000.00 646,400.00 909,000.00 808,000.00 858,500.00 1,010,000.00 808,000.00 1,010,000.00 909,000.00 808,000.00 858,500.00 1,010,000.00 12,059,400.00

Weeks during the month (Cost) 2.00 5.00 5.00 4.00 5.00 4.00 5.00 5.00 4.00 5.00 5.00 4.00 5.00 5.00 63.00

Operating Expenses Per Block Hour

Aircraft Leasing 377.00 27,144.00 67,860.00 67,860.00 54,288.00 67,860.00 54,288.00 67,860.00 67,860.00 54,288.00 67,860.00 67,860.00 54,288.00 67,860.00 67,860.00 855,036.00

Direct Maintenance - Airframe 1,190.00 85,680.00 214,200.00 214,200.00 171,360.00 214,200.00 171,360.00 214,200.00 214,200.00 171,360.00 214,200.00 214,200.00 171,360.00 214,200.00 214,200.00 2,698,920.00

Direct Maintenance - Engines 191.00 13,752.00 34,380.00 34,380.00 27,504.00 34,380.00 27,504.00 34,380.00 34,380.00 27,504.00 34,380.00 34,380.00 27,504.00 34,380.00 34,380.00 433,188.00

Flight Crew Cost 546.00 39,312.00 98,280.00 98,280.00 78,624.00 98,280.00 78,624.00 98,280.00 98,280.00 78,624.00 98,280.00 98,280.00 78,624.00 98,280.00 98,280.00 1,238,328.00

Fuel Cost 1,800.00 129,600.00 324,000.00 324,000.00 259,200.00 324,000.00 259,200.00 324,000.00 324,000.00 259,200.00 324,000.00 324,000.00 259,200.00 324,000.00 324,000.00 4,082,400.00

Ground Handling 430.00 30,960.00 77,400.00 77,400.00 61,920.00 77,400.00 61,920.00 77,400.00 77,400.00 61,920.00 77,400.00 77,400.00 61,920.00 77,400.00 77,400.00 975,240.00

Inflight and Catering 480.00 34,560.00 86,400.00 86,400.00 69,120.00 86,400.00 69,120.00 86,400.00 86,400.00 69,120.00 86,400.00 86,400.00 69,120.00 86,400.00 86,400.00 1,088,640.00

Ins 136.00 9,792.00 24,480.00 24,480.00 19,584.00 24,480.00 19,584.00 24,480.00 24,480.00 19,584.00 24,480.00 24,480.00 19,584.00 24,480.00 24,480.00 308,448.00

Landing / Parking 365.00 26,280.00 65,700.00 65,700.00 52,560.00 65,700.00 52,560.00 65,700.00 65,700.00 52,560.00 65,700.00 65,700.00 52,560.00 65,700.00 65,700.00 827,820.00

Total Operating Expenses 5,515.00 397,080.00 992,700.00 992,700.00 794,160.00 992,700.00 794,160.00 992,700.00 992,700.00 794,160.00 992,700.00 992,700.00 794,160.00 992,700.00 992,700.00 12,508,020.00

Selling, General and Adminstrative Expenses

Administrative costs 71.70 5,162.40 12,906.00 12,906.00 10,324.80 12,906.00 10,324.80 12,906.00 12,906.00 10,324.80 12,906.00 12,906.00 10,324.80 12,906.00 12,906.00 162,615.60

Overhead (Staffs, Rental) 330.90 23,824.80 59,562.00 59,562.00 47,649.60 59,562.00 47,649.60 59,562.00 59,562.00 47,649.60 59,562.00 59,562.00 47,649.60 59,562.00 59,562.00 750,481.20

Sales Cost 204.05 14,691.60 36,729.00 36,729.00 29,383.20 36,729.00 29,383.20 36,729.00 36,729.00 29,383.20 36,729.00 36,729.00 29,383.20 36,729.00 36,729.00 462,785.40

Total Selling, General and Admin. Expenses 606.65 43,678.80 109,197.00 109,197.00 87,357.60 109,197.00 87,357.60 109,197.00 109,197.00 87,357.60 109,197.00 109,197.00 87,357.60 109,197.00 109,197.00 1,375,882.20

Total Expenses 6,121.65 440,758.80 1,101,897.00 1,101,897.00 881,517.60 1,101,897.00 881,517.60 1,101,897.00 1,101,897.00 881,517.60 1,101,897.00 1,101,897.00 881,517.60 1,101,897.00 1,101,897.00 13,883,902.20

Gross Profit / (Loss) (36,758.80) (91,897.00) (91,897.00) (235,117.60) (192,897.00) (73,517.60) (243,397.00) (91,897.00) (73,517.60) (91,897.00) (192,897.00) (73,517.60) (243,397.00) (91,897.00) (1,824,502.20)
20/9/2010

Revised by: Charles Tse

Freedom Air Forecast Income Statement and Operating Assumptions (USD)

(GUM - MNL)

Total

Weekly Block Hours 29.33 29.33 29.33 29.33 29.33 29.33 29.33 29.33 29.33 29.33 29.33 29.33 29.33 29.33

Weeks during the month (Revenue) 2.00 5.00 5.00 3.20 4.50 4.00 4.25 5.00 4.00 5.00 4.50 4.00 4.25 5.00 59.70

First 13.5 months

Revenue 15-30 Nov 10 Dec-10 Jan-11 Feb-11 Mar-11 Apr-11 May-11 Jun-11 Jul-11 Aug-11 Sep-11 Oct-11 Nov-11 Dec-11 of Operation

Y-Seats (112 seats)

Revenue per seat A 400.00

Estimate load B 90.00

Revenue per flight C = A x B 36,000.00

Weekly Freq. D 4.00

Estimated Y seats Revenue per wk E = C x D 144,000.00 288,000.00 720,000.00 720,000.00 460,800.00 648,000.00 576,000.00 612,000.00 720,000.00 576,000.00 720,000.00 648,000.00 576,000.00 612,000.00 720,000.00 8,596,800.00

F-Seats (12 seats)

Revenue per seat F 950.00

Estimate load G 5.00

Revenue per flight H = F x G 4,750.00

Weekly Freq. I 4.00

Estimated F seats Revenue per wk J = H x I 19,000.00 38,000.00 95,000.00 95,000.00 60,800.00 85,500.00 76,000.00 80,750.00 95,000.00 76,000.00 95,000.00 85,500.00 76,000.00 80,750.00 95,000.00 1,134,300.00

Total Estimated Revenue 163,000.00 326,000.00 815,000.00 815,000.00 521,600.00 733,500.00 652,000.00 692,750.00 815,000.00 652,000.00 815,000.00 733,500.00 652,000.00 692,750.00 815,000.00 9,731,100.00

Weeks during the month (Cost) 2.00 5.00 5.00 4.00 5.00 4.00 5.00 5.00 4.00 5.00 5.00 4.00 5.00 5.00 63.00

Operating Expenses Per Block Hour

Aircraft Leasing 377.00 22,117.33 55,293.33 55,293.33 44,234.67 55,293.33 44,234.67 55,293.33 55,293.33 44,234.67 55,293.33 55,293.33 44,234.67 55,293.33 55,293.33 696,696.00

Direct Maintenance - Airframe 1,190.00 69,813.33 174,533.33 174,533.33 139,626.67 174,533.33 139,626.67 174,533.33 174,533.33 139,626.67 174,533.33 174,533.33 139,626.67 174,533.33 174,533.33 2,199,120.00

Direct Maintenance - Engines 191.00 11,205.33 28,013.33 28,013.33 22,410.67 28,013.33 22,410.67 28,013.33 28,013.33 22,410.67 28,013.33 28,013.33 22,410.67 28,013.33 28,013.33 352,968.00

Flight Crew Cost 546.00 32,032.00 80,080.00 80,080.00 64,064.00 80,080.00 64,064.00 80,080.00 80,080.00 64,064.00 80,080.00 80,080.00 64,064.00 80,080.00 80,080.00 1,009,008.00

Fuel Cost 1,800.00 105,600.00 264,000.00 264,000.00 211,200.00 264,000.00 211,200.00 264,000.00 264,000.00 211,200.00 264,000.00 264,000.00 211,200.00 264,000.00 264,000.00 3,326,400.00

Ground Handling 430.00 25,226.67 63,066.67 63,066.67 50,453.33 63,066.67 50,453.33 63,066.67 63,066.67 50,453.33 63,066.67 63,066.67 50,453.33 63,066.67 63,066.67 794,640.00

Inflight and Catering 480.00 28,160.00 70,400.00 70,400.00 56,320.00 70,400.00 56,320.00 70,400.00 70,400.00 56,320.00 70,400.00 70,400.00 56,320.00 70,400.00 70,400.00 887,040.00

Ins 136.00 7,978.67 19,946.67 19,946.67 15,957.33 19,946.67 15,957.33 19,946.67 19,946.67 15,957.33 19,946.67 19,946.67 15,957.33 19,946.67 19,946.67 251,328.00

Landing / Parking 365.00 21,413.33 53,533.33 53,533.33 42,826.67 53,533.33 42,826.67 53,533.33 53,533.33 42,826.67 53,533.33 53,533.33 42,826.67 53,533.33 53,533.33 674,520.00

Total Operating Expenses 5,515.00 323,546.67 808,866.67 808,866.67 647,093.33 808,866.67 647,093.33 808,866.67 808,866.67 647,093.33 808,866.67 808,866.67 647,093.33 808,866.67 808,866.67 10,191,720.00

Selling, General and Adminstrative Expenses

Administrative costs 71.70 4,206.40 10,516.00 10,516.00 8,412.80 10,516.00 8,412.80 10,516.00 10,516.00 8,412.80 10,516.00 10,516.00 8,412.80 10,516.00 10,516.00 132,501.60

Overhead (Staffs, Rental) 330.90 19,412.80 48,532.00 48,532.00 38,825.60 48,532.00 38,825.60 48,532.00 48,532.00 38,825.60 48,532.00 48,532.00 38,825.60 48,532.00 48,532.00 611,503.20

Sales Cost 204.05 11,970.93 29,927.33 29,927.33 23,941.87 29,927.33 23,941.87 29,927.33 29,927.33 23,941.87 29,927.33 29,927.33 23,941.87 29,927.33 29,927.33 377,084.40

Total Selling, General and Admin. Expenses 606.65 35,590.13 88,975.33 88,975.33 71,180.27 88,975.33 71,180.27 88,975.33 88,975.33 71,180.27 88,975.33 88,975.33 71,180.27 88,975.33 88,975.33 1,121,089.20

Total Expenses 6,121.65 359,136.80 897,842.00 897,842.00 718,273.60 897,842.00 718,273.60 897,842.00 897,842.00 718,273.60 897,842.00 897,842.00 718,273.60 897,842.00 897,842.00 11,312,809.20

Gross Profit / (Loss) (33,136.80) (82,842.00) (82,842.00) (196,673.60) (164,342.00) (66,273.60) (205,092.00) (82,842.00) (66,273.60) (82,842.00) (164,342.00) (66,273.60) (205,092.00) (82,842.00) (1,581,709.20)
FA EXHIBIT G 
For the year 2010 / 2011

A/C: Payments Date:

Prepared by: Charles Tse

Rate: 7.8

HK$ USD

Aircrafts deposit 1,560,241.18 200,030.92

Adminstrative and Management 1,220,583.09 156,485.01

Aircraft Maintenance & Management Software 234,000.00 30,000.00

Bank Charges 200.62 25.72

Business plan presentation 3,082.17 395.15

Business Trips & Accomodation 166,067.73 21,290.73

Construction works 117,442.57 15,056.74

Consultation fee - draft manual 555,664.04 71,238.98

Design & Production of Air Plane Models 19,690.91 2,524.48

Fix assets 48,330.75 6,196.25

Incorporation fees 31,676.81 4,061.13

Labour & Allowances 38,937.68 4,992.01

Media & Marketing 24,030.00 3,080.77

Office Rental 188,781.40 24,202.74

PAX reservation system 312,338.29 40,043.37

Professional service - Legal fees 576,803.06 73,949.11

Staff trainings 48,496.50 6,217.50

 5,146,366.80 659,790.62

Professional service - Legal fees 372,927.91 47,811.27

Construction works 78,000.00 10,000.00

 450,927.91 57,811.27

Fly Micronesia Ltd

22/9/2010

Payments already paid

Pending for payments