exhibit10_4d.htm


     

     

    
      EXHIBIT
10.4(d)

      CONFIDENTIAL
TREATMENT

      REQUESTED
PURSUANT TO RULE 24b-2

      Certain
portions of this exhibit have been omitted pursuant to a request for
confidential treatment under Rule 24b-2 of the Securities Exchange Act of
1934.  The omitted materials have been filed separately with the
Securities and Exchange Commission.

      


       

      
        	
                CONFIDENTIAL

              


      

       

       

    

     

    AMENDMENT
TO THE

    AMENDED
AND RESTATED AIR SERVICES AGREEMENT

     

    This
Amendment to the Amended and Restated Air Services Agreement (“Amendment”), is
entered into effective as of October 23, 2008 between AMR Corporation, a
Delaware corporation (“AMR”) and Chautauqua
Airlines, Inc., a New York corporation (the “Contractor”).

     

    
      
        
          

        



       

      Recitals

       

      


    

    AMR and Contractor entered into an Air
Services Agreement dated June 11, 2001 (“Original
Agreement”) for Contractor
to operate Feeder Air Service utilizing regional jets.  The Original
Agreement was superseded by the Amended and Restated Air Services
Agreement dated as of June 12, 2002 (as amended from time to time, “Agreement”).  The
Agreement was amended by a Side Letter agreement dated March 26, 2003 and by an
Amendment to Amended and Restated Air Services Agreement dated October 28,
2003.

     

    The
Agreement provides that Contractor will operate Feeder Air Service utilizing 15
Embraer ERJ 140 aircraft and AMR now wants Contractor to reduce the number to 13
Embraer ERJ 140 aircraft.

     

      
        

      

    

    
      


       

    

    The
parties hereby amend the Agreement as described below:

     

     

    
      	
              1.  

            	
              Removed
      Aircraft

            


    

     

    Notwithstanding
anything to the contrary in the Agreement (including without limitation Section
1.02), Contractor shall on and after June 1, 2009 provide Feeder Air Service
under a monthly schedule based on utilizing 13 Approved Aircraft and all amounts
(other than Rental Fees described below) that are payable by AA to Contractor
under the Agreement shall be calculated based on Contractor utilizing 13
Approved Aircraft.  Contractor hereby grants to AA rights, exercisable
on [*] written notice to
Contractor, to cause Contractor to again provide Feeder Air Service under a
monthly schedule utilizing 14 or 15 Approved Aircraft so long as Contractor has
not executed a binding agreement for a Disposition (defined below) of a Removed
Aircraft (defined below) before receiving AA’s notice and so long as all amounts
that are payable by AA to Contractor under the Agreement are calculated based on
Contractor utilizing the additional Approved Aircraft.  In the event
AA provides such notice to Contractor, AA agrees to utilize such Removed
Aircraft as an Approved Aircraft [*].

     

    Notwithstanding
that the Contractor may be providing Feeder Air Service under a monthly schedule
based on utilizing fewer than all of the Approved Aircraft: (i) Contractor shall
continue to keep all of the Approved Aircraft in airworthy condition and may
utilize any Approved Aircraft to provide Feeder Air Service Flights; and (ii) AA
shall pay to Contractor as Pass Through Costs the monthly rental fees owed by
Contractor for each Approved Aircraft as shown in Annex A to this Amendment
(“Rental
Fees”).  Contractor shall use, and AA’s obligation to pay the
Rental Fees is conditioned upon Contractor using, its commercially reasonable
efforts to sell, sublease or otherwise transfer ("Disposition") up to
two of the Approved Aircraft that are not required under a monthly schedule
based on utilizing less than 15 Approved Aircraft ("Removed
Aircraft").  Any Disposition shall be on terms that eliminate
any remaining Rental Fees owed to third parties for the Removed Aircraft and
that are otherwise reasonably acceptable to Contractor and AA.  AA
shall have no obligation to pay Rental Fees to Contractor with respect to a
Removed Aircraft after the earlier of (a) a Disposition of that Removed Aircraft
and (b) the expiration or termination of the Agreement.  After each
Disposition, AA nevertheless will pay to Contractor each month, until the
termination or expiration of the Agreement, an amount equal to [*] (“Incentive
Payments”).  The Rental Fees and Incentive Payments shall be
pro rated daily for any partial periods.

     

     

    
      	
              2.  

            	
              Termination Without
      Cause

            


    

     

    Section
7.02(k) is hereby amended by deleting clauses (1) and (2) of the proviso and
inserting the following new clauses (1) and (2):

     

     

    (1) such
notice may not be given prior to September 30, 2011, (2) AA will pay to
Contractor the amount of [*] upon the termination of
the Agreement pursuant to this Section 7.02(k),

     

    *Confidential

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
      	
              3.  

            	
              Exhibits and
      Schedules

            


    

     

    
      	
              (A)  

            	
              Section
      1.B. (Passenger Stipend) of Exhibit E (Charges Payable) shall be
      deleted in its entirety.

            


    

     

    
      	
              (B)  

            	
              Effective
      April 1, 2009, Schedule E-1b (ERJ-140 Block Hour Payment Rate
      and Passenger
      Stipend Rate) to the Agreement shall be deleted in its entirety and
      replaced with Annex B to this Amendment (such replacement to occur
      immediately prior to any escalation of such amounts pursuant to Schedule
      E-4, it being acknowledged that such escalation of such replacement
      amounts shall occur on such date).

            


    

     

    
      	
              (C)  

            	
              Section
      1.A. of Schedule E-3 (Pass Through Costs) to the Agreement is hereby
      deleted in its entirety and replaced with the
  following:

            


    

     

     

    
      	
               
      

            	
              A.

            	
              Fuel
      (into-plane) – The Block Hour charge includes cost reimbursement to
      Contractor for Jet A fuel at an average gross (into-plane, including
      taxes and servicing) cost of [*] per gallon (“Base Fuel
      Cost”).

            


    

     

     

    If
Contractor’s actual average gross cost per gallon of Jet A fuel purchased
for Feeder Air Service during any calendar month (“Actual Fuel Cost”) exceeds the
Base Fuel Cost, then AA shall pay to Contractor with respect to the next
succeeding calendar month, in the manner provided in Section 3.B of
Exhibit F, an advance payment of the estimated excess fuel cost for that
month (“Fuel
Advance”).  The Fuel Advance shall be determined by [*].

     

     

    If
Contractor’s actual cost for fuel purchased for Feeder Service Flights during a
calendar month (“Monthly Fuel
Cost”) exceeds the sum of (a) the Fuel Advance for that month, and (b)
the Base Fuel Cost multiplied by the Block Hours for that month, then [*].

     

     

    [*]

     

    
      	
              (D)  

            	
              Section 3.B
      of Exhibit F (Accounting Procedures) to the Agreement is hereby
      deleted in its entirety and replaced by the
  following:

            


    

     

     

    
      	
               
      

            	
              B.

            	
              AA
      shall pay Contractor
      for Feeder Air Services, via wire transfer, according to the
      provisions set forth below:

            


    

     

     

    (1)           AA
shall estimate the monthly Block Hour charges based upon the published flight
schedule for that month and shall pay Contractor [*] of the
estimated Block Hour charges in the following installments:

     

     

    (2)           On
the 5th day of the month, or the next business day, AA shall pay Contractor
[*]of
the sum of the estimated Block Hour charge and the Fuel Advance for the current
month.

     

     

    (3)           On
the 10th day of the month, or the next business day, AA shall pay Contractor
[*] of
the sum of the estimated Block Hour charge and the Fuel Advance for the current
month.

     

     

    (4)           On
the 25th day of the month, or the next business day, AA shall pay Contractor:
(i) [*]
of the sum of the estimated Block Hour charge and the Fuel Advance for the
current month, plus (ii) any amounts due Contractor for Freight and Small
Package shipments under Section 6 of Exhibit F below, plus (iii) the
reconciliation of the prior month’s Block Hours charges, except that AA may
offset against those prior month’s reconciliation items any amounts due to AA by
Contractor.

     

    
      	
              (E)  

            	
              Because
      there remain no unamortized training costs, Exhibit M (Training Costs
      Table) to the Agreement is hereby deleted in its
  entirety.

            


    

     

     

    
      	
              4.  

            	
              Miscellaneous.

            


    

     

    All
capitalized terms not defined in this Amendment have the meanings ascribed to
them in the Agreement.

     


    
      
        
          *Confidential

           

        

         


      

      
         


        
          

        

      

      
         


      

    


    The
Agreement, as amended by this Amendment, constitutes the entire understanding of
the parties with respect to its subject matter and supersedes any other prior or
contemporaneous agreements, whether written or oral, with respect to its subject
matter.

     

    This
Amendment may be executed in any number of counterparts, each of which shall be
deemed an original and all of which, taken together, shall constitute one and
the same instrument.

     

    All terms
of the Agreement remain in full force and effect except as amended by this
Amendment.

     

     

    The
parties signed this Amendment to the Amended and Restated Air Services Agreement
on the dates written below.

     

     

    
      
        	
                Chautauqua
      Airlines, Inc.

              	 	 	
                AMR
      Corporation

              	 
	 	 	 	 	 
	
                /s/
      Bryan Bedford

              	 	 	
                /s/
      Gary D. Foss

              	 
	
                Name:
      Bryan
      Bedford

              	 	 	
                Name:
      Gary
      D. Foss 

              	 
	
                Title:
      President & CEO 

              	 	 	
                Title:
      VP Planning & Marketing

              	 
	Dated:
      October 23, 2008	 	 	Dated:
      October 23, 2008	 


      

    

     

     

     

    



    
      
        
          


          


           

        

         


      

      
         


        
          

        

      

      
         


        
          


           

          ANNEX
A

           

        

      

    

    
      

    


    


    
      


       

      Pass-Through
Costs for ERJ140 Aircraft Rental

       

       

      Rental
Fees

       

      


    

    
      	
              
                Tail
      #

              

            	
              
                Monthly
      Rent

              

            
	
              N295SK

            	
              [*]

            
	
              N297SK

            	
              [*]

            
	
              N299SK

            	
              [*]

            
	
              N371SK

            	
              [*]

            
	
              N372SK

            	
              [*]

            
	
              N373SK

            	
              [*]

            
	
              N374SK

            	
              [*]

            
	
              N375SK

            	
              [*]

            
	
              N376SK

            	
              [*]

            
	
              N377SK

            	
              [*]

            
	
              N378SK

            	
              [*]

            
	
              N379SK

            	
              [*]

            
	
              N380SK

            	
              [*]

            
	
              N381SK

            	
              [*]

            
	
              N382SK

            	
              [*]

            


    

    
      


       

      


       

      *Confidential

      


       

      


    


    
      
        
                                                
Annex A – Page 1

        

         


      

      
         


        
          

        

      

      
         


        
           

           

          ANNEX
B

           

        

      

    


    


    
      


       

        
          

        

      

      Schedule E-1b – ERJ-140 Block Hour
Payment Rate

       

      Effective
April 1, 2009


    

    
      	 
      
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	
              Scheduled

            	
              New
      Block

            
	 
      	
              Utilization

            	
              Hour
      Rate

            
	
              Minimum

            	
              [*]

            	
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              [*]

            
	
              Maximum

            	
              [*]

            	
              [*]

            


    

     

    *Confidential

    
      
        
            
Annex B – Schedule E-1b – Page