Order 2012-7-5

Served: July 6, 2012

UNITED STATES OF AMERICA

DEPARTMENT OF TRANSPORTATION

OFFICE OF THE SECRETARY

WASHINGTON, D.C.

Issued by the Department of Transportation

on the 6th day of July, 2012

Fitness Determination of

KEY LIME AIR CORPORATION 

as a commuter air carrier under section 

49 U.S.C. § 41738

Docket DOT-OST-2009-0116

ORDER TO SHOW CAUSE

PROPOSING ISSUANCE OF A COMMUTER AIR CARRIER AUTHORITY

Summary

By this order, we tentatively conclude that Key Lime Air Corporation (“Key Lime”) is a citizen 

of the United States and is fit, willing, and able to conduct scheduled passenger operations as a 

commuter air carrier, subject to conditions.

Background

Section 41738 of Title 49 of the United States Code (“the Transportation Code”) and 

section 298.32 of the Department’s Aviation Economic Regulations (14 CFR 298.32) direct us to 

determine that applicants proposing to provide scheduled passenger service as commuter air 

carriers are “fit, willing, and able to operate the proposed commuter service.” We must also 

ensure that all operations relating to this service conform to the safety standards established by 

the Federal Aviation Administration (“FAA”). In making fitness findings, the Department uses a 

three-part test that reconciles the Airline Deregulation Act’s liberal entry policy with Congress’ 

concern for operational safety and consumer protection. The three areas of inquiry that must be 

addressed in order to determine an air carrier’s fitness are whether the applicant: (1) will have the 

managerial skills and technical ability to conduct the proposed operations, (2) has sufficient 

financial resources to commence the operations proposed without posing an undue risk to 

consumers or their funds, and (3) will comply with the Statute and regulations imposed by 

federal and state agencies. We must also determine that the applicant is a U.S. citizen.

On May 12, 2009, Key Lime filed an application in Docket DOT-OST-2009-0116 for authority 

to conduct scheduled passenger operations as a commuter air carrier pursuant to 49 U.S.C. 
2

§ 41738 of the Statute. Key Lime accompanied its application with fitness information required 

by § 204.3 of our regulations (14 CFR 204.3).1

No answers opposing Key Lime’s application were filed and no special issues regarding the 

applicant have come to our attention. Under these circumstances, we propose to decide the issue 

of the applicant’s fitness on the basis of the written record, and we tentatively conclude that Key 

Lime is a U.S. citizen and is fit, willing, and able to provide scheduled passenger operations as a 

commuter air carrier. However, we will give interested persons an opportunity to show cause 

why we should not adopt as final these tentative findings and conclusions.

FITNESS

The Company

Key Lime is a corporation that was organized under the laws of the State of Colorado in 

November 1996. The applicant was found fit to conduct interstate on-demand air cargo 

transportation in May 1997, and later that same year, commenced operations under Part 135 of 

the Federal Aviation Regulations using one Piper Navajo Chieftain aircraft. By 2000, Key Lime 

had secured several contracts with multiple freight forwarders, including United Parcel Service, 

Inc. (“UPS”), Airborne Express, Inc., and DHL Airways, Inc. In 2002, the applicant grew its 

business to include on-demand passenger operations and obtained authority from the FAA to

operate aircraft with up to 30 seats, which enabled Key Lime to acquire additional contracts with

several universities to transport collegiate athletes. In 2003, Key Lime was awarded a UPS 

contract to conduct all of its Denver-based operations. 

Currently, Key Lime operates under its FAA Part 135 operating certificate and transports cargo 

and passengers between its base in Denver and the Western Slope of Colorado using a fleet 

consisting of approximately 32 aircraft.

Managerial Competence

The following individuals, all U.S. citizens, serve as Key Lime’s key management and technical 

personnel.

Mr. Clifford D. Honeycutt President and Chief Executive Officer

Mr. Glen M. Rich Vice President 

Mr. Mark Hesting Chief Financial Officer

Mr. John T. Schleibaum Director of Operations

Mr. Johnnie Krien Director of Maintenance

Mr. Wade Goetz Director of Safety

Mr. Richard Jones Chief Pilot

Mr. Paul Rylatt Chief Inspector

 

1 Key Lime filed additional information supplementing its application on October 23, 2009, March 19, 2010, 

December 13 and 19, 2011, and March 21 and 29, 2012.
3

Mr. Clifford D. Honeycutt, Key Lime’s President and Chief Executive Officer, founded the 

company in 1996. He is an Airline Transport Pilot with over 7,200 total flight hours logged, and 

he has also worked as a pilot and an aircraft mechanic for the air carrier. Before establishing 

Key Lime, Mr. Honeycutt moved progressively through a series of positions with multiple 

airlines, including Shop Manager/Mechanic for Precision Aircraft and Engine Services, Inc. 

(1990-1997); Director of Maintenance (1995-1997) and Line Pilot (1994-1996) for Sundance 

Air, Inc., Line Technician for Denver JetCenter, Inc. (1991-1992); and Line 

Technician/Mechanic Assistant/Apprentice for Judson Flying Service, Inc. (1986-1990). 

Mr. Glen M. Rich, an Airline Transport Pilot with 8,800 total flight hours logged, assumed his 

current position as Vice President of Key Lime in 1996. During his tenure with the applicant, he 

developed skills in multiple areas of operations and management, having served as Director of 

Operations, Chief Pilot, Company Instructor, Check Airman, and Designated Examiner. Before 

that, Mr. Rich served as Chief Pilot and Company Flight Instructor for Sundance Air, Inc. 

(1995-1997); Flight Instructor for Wings of Denver, Inc. (1993-1995); Cargo Technician for 

DHL Airways, Inc. (1994-1995); and Aircraft Service Technician/Customer Service 

Representative for Denver JetCenter, Inc. (1992-1994). In 1994, Mr. Rich graduated from 

Metropolitan State College of Denver with a Bachelor of Science in General Aviation 

(1991-1994). 

Mr. Mark Hesting has served as the applicant’s Chief Financial Officer since 2008. Before 

joining Key Lime, he was employed as a Field Service Supervisor for DHL International, Inc. 

(2007-2008), and a Financial Consultant for A.G. Edwards, Inc. (2005-2006). He moved 

progressively through a series of positions with increasing levels of responsibility at UPS

(1992-2005) Mr. Hesting holds a Bachelor of Arts in Psychology from Western State College, 

and a Master of Business Administration with an emphasis in Finance from Daniels College of 

Business, University of Denver.

Mr. John T. Schleibaum, an Airline Transport Pilot, developed skills in multiple areas of 

operations and management, having served as Key Lime’s Line Pilot (2004-2005), Assistant 

Chief Pilot (2005-2006), Chief Pilot (2006-2008), and Director of Operations (2008-Present). 

Before joining Key Lime, he was employed as a Truck Driver (2004) and performed general 

labor tasks (1993-2004) for Spray Sand & Gravel, Inc. He served as Director of Operations for 

DK&L Company (2002-2004), and was employed as a Line Pilot for Frankfort Flight Service, 

Inc (2001-2002). He holds a Bachelor of Science in Professional Flight and a Bachelor of Arts 

in Aviation from Purdue University. 

Mr. Johnnie Krien, an Airframe and Poweplant Mechanic, became Key Lime’s Director of 

Maintenance in January 2012. He initially joined the company as a mechanic in March 2003. 

Before coming to Key Lime, Mr. Krien worked for Sito Truss Manufacturing as a Truss 

Fabricator (1999-2003). Prior to that, he worked as a Mechanic’s Assistant for K & M Aviation 

(1998) and Thomason Aviation (1998-1999). Mr. Krien also has experience working as a truck 

driver (1996-1998) and as a laborer (1994-1995).
4

Mr. Richard E. Jones, an Airline Transport Pilot with 5,500 total flight hours logged, joined Key 

Lime as a Pilot in 2003, and assumed his current position as Chief Pilot in 2008. Previously, he 

held the positions of Private Pilot Ground School Instructor (2001-2003), Assistant Chief Flight 

Instructor (2001-2003), and Flight Instructor (2000-2003) with Aspen Flying Club, Inc. Prior to 

that, he served in various non-aviation-related positions (1994-1999). In 2000, Mr. Jones 

received a Bachelor of Science Degree in Aviation Technology from the Metropolitan State 

College of Denver. 

Mr. Wade Goetz, a Certified Flight Instructor, has served as Key Lime’s First Officer since 2003 

and assumed his current position as Director of Safety in 2004. In addition to his duties with the 

applicant, Mr. Goetz also serves as owner and Director of Charter Alliance Group LLC, (2005-

present), Manager of the Cessna Aircraft Sales Center at Centennial Airport (2003-present) and 

Co-Creator of APA Centre, Inc. (1997-present). He also is President and Chief Executive 

Officer of Altitudes Flight Training Center, Inc. (1992-present). Previously, Mr. Goetz served as 

Chief Pilot for the Aspen Flying Club (1999-2000). He also created Elutions, Inc., a biotech 

company specializing in research and development (1996-1997). Additionally, Mr. Goetz 

established the Pilot Shop at Centennial Airport, a pilot supply company (1993-1998), and 

served as a Flight Instructor for Aero Training of the Rockies at Centennial Airport (1989-1992). 

Mr. Goetz also served in various non-aviation-related positions from 1976-1987. He attended 

the Arapahoe Community College (1980-1982), University of Southern Colorado (1982-1984), 

and holds an Aviation Degree from Emery Aviation College (1988-1989), and has, since 1996, 

served on numerous boards and committees at the Centennial Airport on behalf of the Arapahoe 

County Public Airport Authority. 

Mr. Paul Rylatt, an Airframe and Powerplant Mechanic, assumed his current position as Key 

Lime’s Chief Inspector in 2007, and before that, held the same post at Pilatus Business Aircraft, 

Inc. (2007). Previously, he served as a Quality Control Inspector (2004-2007) and Lead 

Airframe and Powerplant Mechanic (2003) at Evergreen Air Center, and served a three-month 

term as a Quality Control Supervisor at Bombardier Aerospace (2003-2004). Mr. Rylatt has held 

multiple positions with increasing levels of responsibility at Mesa Airlines, Inc., including

Airframe and Powerplant Mechanic/Inspector/Day Shift Supervisor (1996-1999), Line 

Maintenance Manager (1999-2002), and Station Maintenance Manager (2002-2003). Before 

that, he served as a Senior Technical Advisor (1993-1996) and Fabrication Service 

Technician/Warranty Administrator (1991-1992) at Mark VII Equipment, Inc. Additionally, 

Mr. Rylatt held the position of Airframe and Powerplant Mechanic for Frontier Aero Structures 

(1992-1993), Continental Airlines (1990-1994), and Pennsylvania Airlines (1988-1990). He also 

served in non-aviation-related positions from 1985-1988. Mr. Rylatt graduated from Colorado 

Aero Tech in 1988.

In light of the experience and background of the applicant’s key management and technical 

personnel, we tentatively conclude that Key Lime’s management team possesses the managerial

skills and technical ability to conduct its proposed operations.2

 

2 Before authorizing an air carrier to conduct air transportation operations, the FAA also evaluates certain of the 

air carrier’s key personnel with respect to the minimum qualifications for those positions as prescribed in the Federal 

Aviation Regulations. The FAA’s evaluation of these key personnel provides an added practical and in-person test 
5

Operating Plan and Financial Position

If granted the commuter authorization it seeks, Key Lime intends to expand its existing 

passenger operations by adding twice-daily scheduled passenger service between Bloomfield, 

Colorado, and Grand Junction, Colorado, using one 18-seat Fairchild Swearingen Metro liner

aircraft. The applicant will also continue to develop its existing cargo business, on-demand air 

taxi service, and Part 380 public charter operations. The air carrier anticipates adding additional 

aircraft and markets served as demand dictates.

In evaluating an applicant’s financial fitness, the Department generally asks that those applicants 

have resources sufficient to cover all pre-operating costs and any negative working capital 

balance, plus a working capital reserve equal to the operating costs that would be incurred in 

three months of normal commuter operations. 

In support of its application, Key Lime submitted current and historical financial statements 

demonstrating the company’s most recent results from operations. The historical profit and loss 

statements provided by the applicant show that for calendar years 2009, 2010, and 2011, the 

company reported revenues of $12.6 million, $14.3 million, and $20.4 million and net income of 

$228,051, $494,307, and $1.0 million, respectively. In addition, the company’s December 31, 

2011, balance sheet shows that it has current assets of $2.3 million and current liabilities of 

$1.8 million, giving the company a positive working capital balance of approximately $500,000. 

Key Lime also reports total shareholder equity of $724,860. 

Key Lime also provided the Department with a financial forecast for its first year of scheduled 

operations and a list of pre-operating expenses. Key Lime states that it expects to incur minimal 

pre-operating expenses of $25,000 since it already provides air service in the market it proposes 

to operate scheduled service. Further, Key Lime projects total first year operating expenses of 

approximately $1.1 million. Based on our evaluation, we find these expense projections 

reasonable and estimate that the company will need approximately $266,103 in funds to meet our 

financial fitness criteria.3 This requirement is satisfied by the air carrier’s available funds. 

Since Key Lime has positive working capital of approximately $500,000, we tentatively 

conclude that Key Lime has sufficient financial resources to enable it to commence its proposed 

 

of the skills and technical ability of these individuals. The FAA has advised us that Key Lime’s management 

personnel are qualified and acceptable for their positions. 

3 To meet the Department’s financial fitness criteria, an applicant should have access to financial resources 

sufficient to cover its pre-operating expenses and the expenses that are reasonably projected to be incurred during 

three months of “normal” operations. Because projected expenses during the first several months of air 

transportation services frequently do not include all costs that will be incurred during a “normal” period of 

operations, it is our practice to base our three-month test on one-quarter of the first year’s operating cost forecast. 

Further, in calculating available resources, projected revenues may not be used. The $266,103 noted here is onequarter of the applicant’s forecast of approximately $1,064,312 in first year expenses equaling $266,078, plus 

$25,000 in pre-operating expenses.
6

scheduled passenger commuter operations without posing an undue risk to consumers or their 

funds.4 

Compliance Disposition

Our review of FAA records indicates that Key Lime has been cited for no violations, accidents, 

and incidents in the five years preceding its application for commuter authority. Further, the 

FAA has advised us that the applicant is making satisfactory progress in obtaining its Part 121 

authority and that it has no objection to the Department’s approval of Key Lime’s application for 

commuter authority.

The applicant states that there are no actions or outstanding judgments against it, its owners, or 

its key personnel nor have there been any charges of unfair, deceptive or anti-competitive 

business practices, or of fraud, felony or antitrust violations brought against any of these parties 

in the past ten years. The applicant also states that there are no pending investigations, 

enforcement actions, or formal complaints filed by the Department against it, its key personnel, 

or persons having a substantial interest in it with respect to compliance with the Statute or the 

Department’s regulations. Moreover, our review of the applicant’s compliance disposition has 

produced no evidence of any compliance issues. 

In light of these circumstances, we tentatively conclude that Key Lime has the proper regard for 

the laws and regulations governing its services to ensure that its aircraft and personnel conform 

to applicable safety standards and that acceptable consumer relations practices will be followed.

CITIZENSHIP

Section 41102 of the Transportation Code requires that authority to engage in air transportation 

be held only by citizens of the United States as defined in 49 U.S.C. 40102(a)(15). That section 

specifies that the president and two-thirds of the board of directors and other managing officers 

be U.S. citizens, that at least 75 percent of the outstanding voting interest be owned by U.S. 

citizens, and that the applicant must be under the actual control of U.S. citizens. 

As stated previously, Key Lime is a corporation organized under the laws of the State of 

Colorado. Three individuals, each of whom is a citizen of the United States, hold Key Lime’s 

100,000 outstanding shares of common stock. Mr. Daniel J. Bauer holds 51,000 shares 

(51 percent),5 Mr. Clifford D. Honeycutt holds 25,000 shares (25 percent),6 and Mr. Glen M. 

Rich holds 24,000 shares (24 percent).7

 

4 As is our practice, prior to making any authority awarded to Key Lime effective, we will require the company to 

provide third-party verification that it continues to have access to the financial resources needed to meet our 

financial test. 5 Mr. Bauer has been an owner of Key Lime since 1996 and has served as Owner/President of Precision Aircraft 

since 1984. He developed skills in multiple areas of operations and management, having served as Service Manager 

of Wings of Denver Flying Club (1983-1984), Representative at Cessna Dealership at Aurora Aviation (1982-1983), 

Field Mechanic at Columbia Helicopter (1981), and maintained a fleet of twin and single engine aircraft for Aero 

Sport, Inc. He served in the U.S. Navy (1975-1979) and holds an Airframe and Powerplant Mechanic license from 

Portland Community College and a Commercial Instrument Rated Pilot’s license from Western Skyways Flight 
7

In view of the foregoing, we tentatively find that Key Lime is owned and actually controlled by 

U.S. citizens, consistent with 49 U.S.C. § 40102(a)(15) and is fit, willing, and able to provide 

commuter operations, subject to conditions. 

OBJECTIONS

We will give interested persons 14 days following the service date of this order to show cause 

why the tentative findings and conclusions set forth here should not be made final; answers to 

objections will be due within 7 days thereafter. We expect such persons to direct their 

objections, if any, to the applications and points at issue and to support such objections with 

detailed economic analyses. If an oral evidentiary hearing or discovery procedures are 

requested, the objector should state in detail why such a hearing or discovery is considered 

necessary and what material issues of decisional fact the objector would expect to establish 

through a hearing or discovery that cannot be established in written pleadings. The objector 

should consider whether discovery procedures alone would be sufficient to resolve material 

issues of decisional fact. If so, the type of procedure should be specified (See Part 302, Rules 19 

and 20); if not, the reasons why not should be explained. We will not entertain general, vague, 

or unsupported objections. If no substantive objections are filed, we will issue an order that will 

make final our tentative findings and conclusions with respect to Key Lime’s fitness and 

certification.

EFFECTIVE COMMUTER AUTHORIZATION 

CONDITIONS AND LIMITATIONS

In the event that we find Key Lime fit, willing, and able to conduct the proposed scheduled 

service, we will issue to it a Commuter Air Carrier Authorization. However, that authorization 

will not become effective until the company has fulfilled all of the requirements for effectiveness 

as set forth in the Terms, Conditions, and Limitations attached to it. Among other things, this 

includes (1) our receipt of evidence of Key Lime’s authority from the FAA authorizing such 

operations, (2) evidence of liability insurance coverage that meets the requirements of section 

205.5(b) of our rules, (3) a statement of changes it may have undergone since its fitness was 

examined, and (4) evidence that Key Lime has adequate financial resources available to it.

Moreover, given the limited scope of Key Lime’s proposed operations, we will impose certain 

limitations on its authorization to provide scheduled air transportation as a commuter air carrier. 

Our finding of fitness for Key Lime is based on the operating plans described in its application. 

 

School. In addition to his ownership in Key Lime, Mr. Bauer also owns a 51 percent interest in the following three 

companies based at Centennial Airport: Precision Aircraft, Inc., a light aircraft maintenance company; Western Aero 

LLC, a hanger leasing company; and EDB Air, Inc., an aircraft holding/leasing company. Mr. Bauer also owns a 40 

percent interest in CBG LLC, an aircraft holding/leasing company, and a 51 percent interest in Flights, Inc., a flight 

training school. 

6 Mr. Honeycutt owns 25 percent of Flights, Inc., and 30 percent of CBG LLC. He also holds the positions of 

President of Flights, Inc., and Manager of CBG LLC.

7 Mr. Rich owns 24 percent of Flights, Inc., and 30 percent of CBG LLC.
8

Should Key Lime desire to acquire and operate large aircraft,8 our fitness findings, particularly 

involving the adequacy of Key Lime’s management and financial resources, might no longer 

apply. Therefore, we propose to limit any authority issued to Key Lime to operations conducted 

using small aircraft.9 Should Key Lime desire to operate larger aircraft, it must first provide the 

Department with at least 45-days advance notice of such plans and provide updated information 

establishing its fitness for such expansion. This limitation will not alter Key Lime’s ability to 

increase the size of its on-demand fleet. 

Furthermore, we remind Key Lime of the requirements of 49 U.S.C. § 41110(e). Specifically, 

that section requires that, once an air carrier is found fit initially, it must remain fit in order to 

hold its authority. To be assured that commuter air carriers continue to be fit after effective 

authority has been issued to them, we require that they supply information describing any 

subsequent substantial changes they may undergo in areas affecting fitness. Therefore, if Key 

Lime is issued an effective Commuter Air Carrier Authorization and should it subsequently 

propose substantial changes in its ownership, management, or operations, it must first comply 

with the requirements of section 204.5 of our rules.10 The compliance of the company with this 

requirement is essential if we are to carry out our responsibilities under section 41110(e).11

Additionally, if Key Lime is granted effective authority, it would be required to submit a detailed 

progress report, within 45 days following the end of the first year of commuter flight operations, 

to the Air Carrier Fitness Division. The submission of a first year progress report was adopted as 

policy by the Department to aid in monitoring the fitness of new air carriers. The report should 

include a description of the air carrier’s current operations (number and type of aircraft, principal 

markets served, total number of full-time employees), a summary of how its operations have 

changed during the year, a discussion of any changes it anticipates from its current operations 

during its second year, current financial statements,12 and a listing of current senior management 

 

8 A large aircraft is defined as any aircraft with an original design capacity of more than 60 passenger seats or an 

18,000 pound payload. 9 A small aircraft is defined as any aircraft originally designed to have a maximum passenger capacity of less 

than 60 seats or a payload capacity of no more than 18,000 pounds. 

10 The air carrier may contact our Air Carrier Fitness Division to report proposed substantial changes in its 

operations, ownership, or management, and to determine what additional information, if any, will be required under 

section 204.5. In addition, by notice dated July 21, 1998, the Department requested air carriers to provide a 30-day 

advance notification of any proposed change in ownership, restructuring, or recapitalization. If the air carrier fails to 

file this updated information or if the information fails to demonstrate that the air carrier will continue to be fit upon 

implementation of the substantial change, the Department may take such action as is appropriate, including 

enforcement action or steps to modify, suspend, or revoke the air carrier's commuter authority.

11 We also remind Key Lime about the requirements of section 204.7 of our rules. This section provides, among 

other things, that (1) the commuter authority granted to a company shall be revoked if the company does not 

commence actual flying operations under that authority within one year of the date of the Department's 

determination of its fitness; (2) if the company commences operations for which it was found fit and subsequently 

ceases such operations, it may not resume commuter operations unless its fitness has been redetermined; and (3) if 

the company does not resume operations within one year of its cessation, its authority shall be revoked for 

dormancy.

12 These financial statements should include a balance sheet as of the end of the company’s first full year of 

commuter flight operations and a 12-month income statement ending that same date.
9

and key technical personnel. The air carrier should also be prepared to meet with staff members 

of the Fitness Division to discuss its current and future operations.

ACCORDINGLY,

1. We direct all interested persons to show cause why we should not issue an order finding that 

Key Lime Air Corporation is fit, willing, and able under 49 U.S.C. § 41738 to provide scheduled 

passenger service as a commuter air carrier.

2. We direct any interested persons having objections to the issuance of an order making final 

any of the proposed findings, conclusions, or the award of authority set forth here to file such 

objections with the Department of Transportation Dockets, 1200 New Jersey Avenue, S.E., West 

Building Ground Floor, Rm. W12-140, Washington, D.C. 20590, in Docket 

DOT-OST-2009-0116 and serve them upon all persons listed in Attachment A no later than 

14 days after the service date of this order; answers to objections shall be filed no later than 

7 days thereafter.

3. If timely and properly supported objections are filed, we will accord full consideration to the 

matters or issues raised by the objections before we take further action.13

4. In the event that no objections are filed, we will consider all further procedural steps to be 

waived and we will enter an order making final our tentative findings and conclusions.

5. We will serve a copy of this order on the persons listed in Attachment A.

6. We will publish a summary of this order in the Federal Register.

By:

SUSAN L. KURLAND

Assistant Secretary

for Aviation and International Affairs

An electronic version of this document is available on the World Wide Web at

http://www.regulations.gov

 

13 Since we have provided for the filing of objections to this order, we will not entertain petitions for 

reconsideration.
Attachment

Specimen

Terms, Conditions, and Limitations

KEY LIME AIR CORPORATION

is authorized to engage in scheduled passenger air transportation operations as a commuter air 

carrier.

This authority is subject to the following provisions:

(1) The authority to conduct scheduled passenger operations will not become effective until 

six (business) days after the Department has received the following documents; provided, 

however, that the Department may stay the effectiveness of this authority at any time prior to that 

date:

(a) A copy of the holder's Air Carrier Certificate and Operations 

Specifications authorizing such operations from the Federal Aviation 

Administration (FAA).

(b) A certificate of insurance on OST Form 6410 evidencing liability 

insurance coverage meeting the requirements of 14 CFR 205.5(b) for all of its 

aircraft.

(c) A statement of any changes the holder has undergone in its ownership, key 

personnel, operating plans, financial posture, or compliance history, since the 

date of the Show Cause Order in this case.

(d) A revised list of pre-operating expenses already paid and those remaining 

to be paid, as well as independent verification that the holder has available to it 

funds sufficient to cover any remaining pre-operating expenses and to provide a 

working capital reserve equal to the operating costs that would be incurred in 

three months of operations.

(2) Pending receipt of effective authority, the holder may not accept payment of any kind 

(i.e., cash, check, or credit card) or issue tickets for scheduled passenger operations, and any 

advertisement or listing of flights by the holder must prominently state: "This service is subject to 

receipt of government operating authority." 

(3) The holder shall at all times conduct its operations in accordance with the requirements 

of 14 CFR Part 298 and any other regulations prescribed by the Department of Transportation 

for the services authorized here, and with such other reasonable terms, conditions, and 

limitations as the Department of Transportation may prescribe in the public interest.

(4) The holder may not operate aircraft designed to have a maximum passenger capacity of 

more than 60 seats or a maximum payload capacity of more than 18,000 pounds.
2

(5) The holder's authority under this certificate is effective only to the extent that such 

operations are also authorized by the Federal Aviation Administration (FAA), and comply with 

all U.S. Government requirements concerning security, including, but not limited to 49 CFR Part 

1544.∗

(6) The holder shall at all times remain a "Citizen of the United States" as required by 49 

U.S.C. 40102(a)(15).

(7) The holder shall maintain in effect liability insurance coverage as required under 14 

CFR Part 205. Failure to maintain such insurance coverage will render this authority 

ineffective, and this or other failure to comply with the provisions of Subtitle VII of Title 49 of the 

United States Code or the Department's regulations shall be sufficient grounds to revoke this 

authority.

(8) In the event that the holder receives effective scheduled passenger authority, the following 

additional conditions will apply:

(a) The holder may reduce or terminate service at any point or between any 

two points, subject to compliance with the provisions of 49 U.S.C. 41734 and all 

orders and regulations issued by the Department of Transportation under that 

section.

(b) The holder may not provide scheduled passenger air transportation to or 

from Dallas (Love Field), Texas, except within the limits set forth in section 29 of 

the International Air Transportation Competition Act of 1979, as amended or as 

modified by any future legislation addressing access restrictions to or from Love 

Field. 

(9) Should the holder propose any substantial change in its ownership, management, or 

operations (as defined in 14 CFR 204.2(l)), it must first comply with the requirements of 14 CFR 

204.5.

(10) In the event that the holder does not commence actual flying operations as a commuter 

air carrier under this authority within one year of the date of the Department's determination of 

its fitness, its commuter authority shall be revoked for dormancy. Further, in the event that the 

holder commences but subsequently ceases all scheduled passenger operations, the authority 

granted here shall be suspended under the terms of 14 CFR 204.7 and the holder may neither 

recommence nor advertise such operations unless its fitness to do so has been redetermined by 

the Department. Moreover, if the holder does not resume such operations within one year of its 

cessation, its commuter authority shall be revoked for dormancy.

 

∗ To assure compliance with all applicable U.S. Government requirements concerning security, the holder shall, 

before commencing any new service (including charter flights) to or from a foreign airport, contact its Principal 

Security Inspector (PSI) to advise the PSI of its plans and to find out whether the Transportation Security 

Administration has determined that security is adequate to allow such airport(s) to be served.
Attachment A

SERVICE LIST FOR KEY LIME 

AIR CORPORATION

CLIFFORD HONEYCUTT

PRESIDENT

KEY LIME AIR CORPORATION

13252 EAST CONTROL TOWER ROAD

ENGLEWOOD COLORADO 80112

GERALD F MURPHY

CROWELL & MORING LLP

1001 PENNSYLVANIA AVNUE NW

WASHINGTON DC 20004-2595

MR PETER LYNCH AGC-300

ASST CHIEF COUNSEL FOR 

ENFORCEMENT

FEDERAL AVIATION ADMINISTRATIO

800 INDEPENDENCE AVE SW

WASHINGTON DC 20591

MR WILLIAM J WEBER

CERTIFICATION SECTION MANAGER

FAA AFS-900

45005 AVIATION DRIVE SUITE 131

DULLES VA 20166

CHRISTOPHER A LANG

PRINCIPLE OPERATIONS INSPECTOR

FEDERAL AVIATION ADMINISTRATION

DENVER FSDO

26805 EAST 68TH AVENUE

DENVER COLORADO 80249

OFFICE OF AIRLINE 

 INFORMATION

DOT/RITA/BTS 

1200 NEW JERSEY AVE SE

WASHINGTON DC 20590