# Sovereig nMr , Inc , • pyen '^ CRT/^TiO N
Jun e 28 , 201 0 Denni s J
. DeVany , Chie f EA S & Domesti cAnalysi s Division , X-5 3 Offic e o fAviatio n Analysi s Departmen to fTransportatio n 120 0 Ne wJerse yAve
. SE Washington , D C 2059 0 Re : Proposa l t o Provid e Essentia l Ai rServic e at : Huron , Sout h Dakota , DOT-OST-2000-713 8

Dea rMr
. DeVany : I n respons e t o Orde r2010-5-26 , Sovereig n Air , Inc
. offer s th e followin g proposal : Sovereig n Air , Inc
. (SAI ) i s plannin g t o us e on e Beechcraf t 9-sea t Kin g Ai raircraf t fo rthi s Essentia l Ai r Servic e route
. W e offe rtw o options
. Optio n 1 i s fo rdirec tflight s betwee n Huro n an d Minneapoli s (MSP)
. Optio n 2 wil l servic e Huron , S D an d eithe rBrookings , S D o rMarshall , M N an d th e MS P Hub
. Sovereig n Ai r believe s tha t wit h goo d schedules , prope rpricin g an d a recoverin g economy , th e loa d factor s wil l likel y increas e i n thes e markets
. SA I wil l bas e it s aircraft , crew s an d maintenanc e personnel , bankin g an d purchas e fue l i n Huron
. Thi s wil l hel p kee p th e EA S monie s i n th e loca l community
. Additiona l flight s wil l b e adde d as neede d t o accommodat e period s o fincrease d demand
. SA I wil l hav e baggag e an d ticke tagreement s wit h th e majo rai rcarrier s i n MS P b yth e star t o fthi s EA S service , SA I wil l als o hav e carg o agreement s fo rbot h domesti can d internationa l ai rfreigh t movements
. SA I wil l b e HAZMA Tapprove d an d wil l b e workin g i n conjunctio n wit h hospital s t o expedit e variou s HAZMA Tmaterial s tha tthe ynee d t o transport
. SAI' s goa l i s t o wor k

hand-in-han d wit h EA S communitie s t o reduc e th e nee d fo rEA S subsidie s withi n th e nex tfou rt o si xyears . Sovereig n Ai ri s currentl yi n th e proces s o facquirin g it s Schedule d Servic e Authorit yan d anticipate s bein g abl e t o star tthi s Essentia l Ai rServic e b yOctobe r1 , 2010
. Sovereig n Ai rwil l b e full yintegrate d int o th e Globa l Distributio n Syste m (GDS ) i n conjunctio n wit h Worldspan
. SA I i s no ttie d t o jus ton e airline , allowin g Sovereig n Ai rbette rvisibilit yi n th e variou s reservatio n systems
. Passenger s wil l hav e a broa d rang e o fchannel s throug h whic h t o purchas e tickets , includin g al l airlin e reservatio n system s an d trave l agencies
. Customer s wil l b e abl e t o cal l ou r reservatio n offic e o rvisi t ou rwebsit e t o boo k flights
. Passenger s ca n als o purchas e ticket s an d mak e reservation s a t ou rticke t counters
.

### SAI' s fina l schedule s wil l b e develope d byth e EA S CityAirpor tBoard an d SAI t o reduc e layove rtime s i n MS P an d provid e th e bes tpossibl e arriva l an d departur e time s fo rth e travellin g public
. A s such , th e followin g schedule s wil l likel yb e adjusted : Propose d Schedul e (one-sto p optio n add s 1 5 minute s t o th e MS P an d th e HO N arrivals ) Flt # 1 0 1 1 2 0 2 1 Fre q 123456 7 123456 7 123456 7 123456 7 Fro m

HO N MS P HO N MS P T

O MS P HO N MS P HO N Dpt-Ar r

6:5 0 -7:4 5 9:30-10:2 5 05:00-05:5 0 09:00-09:5 0Optio n 1 : (NON-STOP ) On e 9-sea tBeechcraf t Kin g Ai r

Sovereig n Air , Inc
. Annua l Compensatio n Requiremen tfo rEssentia l Ai rServic e fo r HON-MS P On e 9-sea t Aircraf tTyp e Kin g Ai r Availabl e Seat s Pe rDepartur e 9 Passenger s Pe rTri p 3. 5 Bloc k Hour s 127 7 Departure s 141 6 Tota l Passenger s 5,00 0 Averag e Far e $3 9 on e wa yHON-MS P Revenu e Passenge rMile s 1,240,00 0 Availabl e Sea tMile s 3,160,51 2 Passenge rRevenu e " $195,000.0 0 Othe rRev
. @
. 6 o fpax . Rev
. % $11,700.0 0 Tota l Revenu e $206,700.0 0 Aircraf tan d Hul l Insuranc e $222,000.0 0 Fue l an d Oi l $402,246.9 8 Flyin g Operation s $263,043.9 9 Othe rDirec tCost s $213,803.8 5 Maintenanc e $101,545.0 2 

### $1,202,639.8 3 $669,109.1 2 Tota l Direc tCost s Tota l Indirec tCost s Tota l Operatin g Expense s $1,871,748.9 5 Operatin g Los s $1,665,048.9 5 Profi t@ 5 % $93,587.4 5 Annua l Compensatio n

Requiremen t $1,758,636.4 0 Completio n Rat e 97 % Loa d Facto r40 %

### Optio n 2 : (ONE-STO P a teithe rBrooking s o rMarshal ) On e 9-seat BeechcraftKin g Ai r

Sovereig n Air , Inc
. Annua l Compensatio n Requiremen tfo rEssentia l Ai rServic e fo r HON-intermediat e -MS P AircraftTyp e Availabl e Seat s Pe rDepartur e Passengers Pe rTri p Bloc k Hours Departure s Tota l Passengers Averag e Fare $2 9 one-wayHON-MS P $2 9 one-wayintermediat e stop-MS P On e 9-seat Kin g Ai r 9 7 127 7 212 4 10,00 0

Revenu e Passenge rMile s Availabl e SeatMile s Passenge rRevenu e Othe rRev
. @
. 6 o fpax . Rev
. % Tota l Revenu e Aircraftan d Hul l Insuranc e Fue l an d Oi l Flyin g Operation s Othe rDirectCost s Maintenanc e Tota l Direct Cost s Tota l IndirectCost s 2,480,00 0 3,160,51 2 $290,000.0 0 $17,400.0 0 $307,400.0 0 $222,000.0 0 $402,246.9 8 $263,043.9 9 $213,803.8 5 $101,545.0 2 $1,202,639.8 3 $669,109.1 2
Tota l Operatin g Expense s Operatin g Los s Profi t@ 5 % $1,871,748.9 5 $1,564,348.9 5 $93,587.4 5 Annua l Compensatio n

Requiremen t$1,657,936.4 0 Completio n Rat e Loa d Facto r 97 % 78 %

### Custome rsafetyan d servic e ar e Priorit yOn e wit h SAI
. Sovereig n Ai rlooks forwar d t o providin g

Essentia l Ai rService t o Huron , Sout h Dakota
. Sincerely ,
Jo n Payne , CF

O Sovereig n Air , Inc
.