February 11,2014

Mr. Kevin Schlemmer Director, Essential Air Service U. S. Department ofTransportation 1200New Jersey Ave., SE Washington, DC, 20590 Re: Kalaupapa, HI Essential Air Service Dear Mr. Shlemmer: As the president and CEO ofMokulele Flight Services, Inc., dba Mokulele Airlines, I am respectfully requesting the opportunity to summarize the reasons that we feel Mokulele is uniquely qualified to provide Essential Air Service to Kalaupapa, Hawai'i. This is afollow-up to our EAS proposal dated October 30th
, 2013. On apersonal level, Ihave a strong commitment to the state through my 52 years of aviation history in Hawai'i. In fact, this is where Ilearned to fly. My goal when Ipurchased Mokulele in 2011 was to provide safe, affordable interisland travel and it is agoal I continue to be deeply committed to. We are well prepared and well equipped to provide the residents and visitors of Kalauapapa with reliable, cost-effective service on a schedule that makes it convenient for them to complete round-trip, same-day travel to and from Honolulu and Kahului. Itis our belief that Mokulele is uniquely qualified to serve this route for the following reasons:

• On-time performance and reliability. Mokulele operates more than 120 flights per day and we have consistently maintained dispatch reliability and on-time departure ratings in the mid-ninety percent range.

• Modern fleet. In 2013, we invested $22 million to add nine brand new nine-passenger Cessna Caravan aircraft to our fleet. This is part ofour commitment to operate the youngest fleet ofany Hawai'i carrier operating under either Part 121 orPart 135 ofthe Federal Aviation Regulations (FARs). By the end ofthe first quarter of2014, Mokulele Airline's fleet will consist ofall 2013 model aircraft, the oldest ofwhich will not yet have seen one year of service. Our newest aircraft are the Cessna Grand Caravan EX model with the larger, 867 horsepower engine which enhances operational safety with greater climb gradients, faster speeds and more available excess power inthe event ofan emergency.• Extraordinary focus on safety. Mokulele Airlines has voluntarily adopted the FAA's "One Level of Safety" philosophy and has committed to operating its aircraft far beyond the minimum standards ofPart 135
. First of all, we have taken the important step of mandating that all ofour revenue flights will be operated with atwo-pilot crew, even though this is not required by the FAA
. In addition: oWe schedule pilots under strict crew rest requirements, well beyond the mnumums.

o We train our pilots to utilize the most current principles ofCockpit Resource Management (CRM) and mandate the use ofwritten checklists for normal, abnormal and emergency operations. oWe require that every passenger flight be operated under Instrument Flight Rules (IFR) under the guidance and supervision ofthe Air Traffic Control system which mandates safer routings, continuous communications from takeoff to landing, higher altitude minimums, greater terrain clearances, radar tracking and higherthan-minimum pilot qualifications.

o We have been approved to use the same Electronic Flight Bag (EFB) program used by the largest air carriers, which places every operational document in the hands ofthe pilots during every moment offlight.

o We operate a sophisticated flight tracking system, including adispatch office located in our Kona System Operations Center (SaC).

o We have initiated meetings with Air Traffic Control (ATC) management and line controllers with the goal offostering abetter understanding and awareness ofthe unique safety requirements of safely operating single-engine turbine aircraft inthe mountainous, open-ocean environment ofHawai'i.

• Strong, proactive commitment to aircraft maintenance. We have established maintenance operations in Kona, Kahului and Honolulu, and we have made a significant investment intraining our mechanics and in upgrading our tooling and support ofour engines.

• EAS track record. In September of2013,we were awarded the essential air service contract for Kamuela, and inthe first month ofoperations, we carried more passengers in and out ofKamuela than the previous carrier had over a 12-month period. Interest in this route is sohigh that we are now planning to add athird flight per day
. Our service toHana, which we launched in 2012, is another success story about the importance and value ofmeeting the needs ofanunderserved market.

• Excellent customer service. All eight ofMokulele Airlines' stations are staffed by trained Customer Service Agents (CSAs) to enhance safety, customer service and aircraft handling. We have also made additional investments in our information technology and reservations systems to ensure that we maintain ahigh level ofservice to our customers.

• Global distribution. We have a global distribution system that makes it convenient for I passengers to make reservations through traditional travel agents as well as through online travel booking sites.

• Strong management team. We have established an experienced, cohesive and proactive management team to support our flight operations and ensure apositive passenger expenence.

• Community support. When Ipurchased Mokulele in 2011, the airline was serving 7,000 passengers per month. Due to the growing demand for our flights, we now serve more than 21,000 passengers per month who are traveling to eight destinations on five islands. We believe this is a strong testament to the trust and confidence Hawai'i residents continue to place in Mokulele. In addition, as the largest carrier serving Ho'olehua Airport, we already have significant experience serving the residents ofMoloka'i. We appreciate the opportunity to bid on serving the Kalaupapa essential air service route. We also respect your recent decision to extend Makana Kai' s current contract until May 31stto give you sufficient time to evaluate all ofthe critical safety, service and reliability factors involved in choosing acarrier. Thank you again for this opportunity. We would be honored to be awarded this contract and we are prepared to begin daily service to meet the needs ofthe residents ofKalaupapa and the visitors who desire to visit this significant landmark in Hawai'i history. Respectfull y, 

## 'Ro-vvfl~ CEOlPresident

Cc: Scott Faulk