e 

U.S. Departmen t o f ^ 1200 New Jersey Ave., S.E. 

Transportation '- •"' U\ 1[ . V-^"0,1KI;0^/ Washington, DC 20590 

Office of the Secretary 

Of Transportation 

June 2, 2010 

Mr. John T. Vito 

President 

Craig Air Center, Inc. 

855-14 St. Johns Bluff Rd. 

Jacksonville, FL 32225 

Re: Docket OST-DOT-2010-0001 

Application of Craig Air Center, Inc. 

for 49 U.S.C §41738 Commuter Authority 

Dear Mr. Vito: 

We have completed our initial review of the application filed on February 23, 2010, by 

Craig Air Center, Inc. ("Craig") for the determination of its fitness to conduct commuter 

air transportation. 

This review has revealed the need for additional and/or clarifying information before we 

can complete processing of Craig's application. The attached Information Request lists 

the areas where further and/or clarification information is necessary. I ask that you 

respond fully to this request within 30 days of the date of this letter. The original plus 6 

copies of your response should be filed in Docket OST-DOT-2010-0001. 

As is the Department's practice, further processing of Craig's application will be deferred 

pending receipt of this material. In addition, please remember that Craig should promptly 

provide the Department with any information regarding changes it may undergo in areas 

affecting its fitness {i.e., management, operating plans or financial condition, compliance 

disposition, or ownership) while its application is under review by the Department. 

Thank you for your cooperation in this matter. If you have any questions regarding this 

letter or the requested information, please feel free to contact Michael Price of my staff at 

202-366-9721. 

Sincere! 

'^anessa R. Balgobin 

Acting Chief, Air Carrier Fitness Division 
Enclosure 

cc: OST-DOT-2010-0001 

Mr. William H. Edwards 

Orlando Flight Standards District Office 

5950 Hazeltine National Drive 

Citadel International - Suite 500 

Orlando, FL 32822 
INFORMATION REQUEST 

Craig Air Center, Inc. 

GENERAL INFORMATION 

1. Please place a copy of Craig's FAA Pre-application Statement of Intent (PASI) in 

the public docket of this proceeding, together with information on any changes 

that have been made to this filing since its original submission to the FAA. Please 

provide the Department with a status update on any progress the air carrier has 

made in obtaining its updated FAA certification. 

2. Craig states that it operates six (6) aircraft in its charter operation, including two 

Beechcraft B1900 airliners, two Beech B200 King Air turboprops, and two Lear 

jets. Please provide the seating/cargo capacity of each type and model of aircraft 

and whether the aircraft are or will be owned or leased. Clearly state which 

aircraft will be used for the proposed commuter operation. 

3. If the aircraft to be used in the proposed operation are currently leased, please 

provide a copy of the executed Lease Agreement between Craig and the lessor 

outlining the terms and conditions of the agreement. 

4. Please state whether Craig has, or proposes, to establish maintenance or 

operations bases separate from its corporate offices. The locations of those bases 

should be indicated. If the Craig intends to contract out any maintenance, 

training, or other operational functions, the percentage and type of such contracts 

should be indicated. 

MANAGEMENT AND KEY TECHNICAL PERSONNEL 

1. Please provide a chart showing the positions and operating divisions within the 

organization that depicts which positions and functions report to whom. 

2. Please provide an updated resume for Robert Feindt, Craig's Chief Pilot, 

indicating his citizenship and accounting for the employment gap between 1995-

1999. 

3. Please provide an updated resume for Tad Pennybaker, Craig's Director of 

Maintenance and Chief Inspector, indicating his citizenship. 

4. In its application, Craig states that its shareholders list is comprised of two 

owners, John T. Vito and James B. Vito. A resume was not provided for James 

B. Vito. Please provide the Department a detailed resume for Mr. Vito. The 

resume should include the his full name, citizenship, current address, and 

telephone numbers, together with a detailed listing of all previous employment 

(both aviation and non-aviation) and education and training. 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. Any periods of unemployment should be accounted for. 

5. For Craig's key technical personnel (Director of Operations, Director of 

Maintenance, Director of Safety, Chief Pilot, and Chief Inspector), a statement 

that these individuals meet the qualifications for their respective positions as set 

forth in sections 119.65 and 119.67 of the Federal Aviation Regulations (14 CFR 

119.65 and 119.67). 

FINANCIAL POSITION 

1. Please provide balance sheets and income statements of the applicant and all 

relevant corporations together with their accompanying explanatory footnotes 

(including a description of the company's significant accounting policies, such as 

for depreciation, amortization of intangibles, overhauls, unearned revenues, and 

cost capitalization),/or the three most recent calendar or fiscal years, and for a 

period ending no more than three months prior to the date of filing. This 

requirement may be met by the submission of financial statements, preferably 

audited, or lOK and/or lOQ reports filed with the Securities and Exchange 

Commission, if applicable. 

a. The financial documents should include a statement as to who prepared 

them, his or her qualifications and relationship, if any, to the applicant, 

and whether they were prepared in accordance with Generally Accepted 

Accounting Principles. If an annual audit, review, or compilation by an 

independent CPA is performed, the name and address of the firm, and the 

type of services provided should be listed. 

b. Any events that occurred after the preparation of the most recent financial 

statements that may have a significant impact on the financial position or on 

the operations of the applicant or any relevant corporation. If no such events 

have occurred, provide a statement to that effect. 

2. Please provide Craig's service proposal and a forecast balance sheet and profit 

and loss statement (broken down by month or by quarter) for the first twelve full 

months of actual flight operations conducted under the commuter authority at 

issue. These documents should include a narrative explaining the basis for the 

amounts shown and whether the statements were prepared on a cash or accrual 

basis. The description should be in sufficient detail to allow the Department's staff 

to replicate the mathematics involved and to determine the reasonableness of the 

forecast. 
The revenue forecast should indicate:' 

a. The proposed markets and number of daily flights in each market. 

b. The type, model, seating/cargo capacity, and number of the aircraft to be used. 

c. The number of passengers to be carried and expected load factors. 

d. The fares or rates to be charged, and the resulting gross revenues. 

e. The total number of revenue block hours and revenue miles expected to be flown, 

and the extent of any seasonal traffic peaks. 

The forecast expense data should show: 

a. Detail by expense category (direct and indirect), indicating how the amounts were 

computed. If Craig proposes to operate more than one aircraft type or model, it 

should include separate estimates of expenses for training, maintenance, 

preparation of manuals, etc., for each aircraft type or model. 

b. For indirect expenses, if Craig is engaged in other aviation-related operations 

(e.g., aircraft leasing or repair station), expenses should be allocated on a rational 

basis between the proposed commuter operations and the other operations, with 

appropriate explanations. The applicant should prepare a consolidated forecast 

income statement for the entire business as well as separate forecast statements 

for each operating segment, including the proposed commuter operation. 

Please provide an estimate of the amount of capital Craig will need to commence 

operations which shows the basis of the estimate (e.g., the amounts for pre-operating 

costs, including aircraft deposits or leases, office and hangar space, insurance, 

salaries, training, FAA and Department certifications, working capital, etc.). The 

estimates should include a narrative explaining the basis for the amounts shown. 

Please provide a description of the proposed form and source of capital to support the 

Craig's operations. 

a. Craig provided cash, securities, and property statements on behalf of the carrier's 

two shareholders, John T. Vito and James B. Vito. If the resources of an 

individual(s) or other organization(s) will be made available to Craig to support 

its operations, provide a statement from such individual(s) or organization(s) of 

the amount of such available resources and the terms or conditions under which 

such funds will be provided. Copies of the personal or corporate financial 

1 If Craig so requests under 14 CFR 302.12, the Department will generally grant confidential treatment to 

information identifying the specific markets to be served, proposed frequency of service, fares, estimated 

revenue passenger miles and available seat miles, and projected load factor. However, if the applicant 

requests confidential treatment of information identifying its proposed markets and related traffic forecasts, 

it must provide for the public record a brief description of the type of markets/cities to be served and the 

total number of flights and revenue block hours to be performed. 
statements of the individual(s) or organization(s) should also be provided. Such 

documentation should clearly establish the capability of the individual(s) or 

organization(s) to fulfill any financial commitment made to or on behalf of the 

applicant. In this connection, the liquidity of any assets, other than cash, 

contained in these documents should be made clear through appropriate footnotes 

(e.g., the current market value of stocks and bonds that can be readily converted 

to cash should be noted). Whenever possible, third-party verification of the assets 

and values should be provided (e.g., letters from banks or stockbrokers holding 

liquid assets, or recent appraisals of real assets). 

5. Please provide third-party verification of all lines-of-credit available, if any, to 

support Craig's proposed operations. This verification should include the total 

line-of-credit being made available, the amount such credit line has been drawn 

down to date, any conditions that must be met before funds will be advanced, the 

terms of repayment, and the expiration date. Further, if the line-of-credit is being 

supplied by an individual or organization (other than a recognized financial 

institution) copies of the personal or corporate financial statements of the 

individual or organization should also be provided. 

6. If borrowed capital or a line-of-credit is to be employed, the total amount, current 

balance, source, security, provisions to convert the debt to equity, and terms of 

repayment to the lender should be stated. Verification of this information from the 

lender should be provided. 

7. Please provide third-party verification of all cash deposits available to support 

Craig's proposed operations. 

CERTIFICATION 

The information provided pursuant to this Information Request should be accompanied 

by the following certification: 

The contents of this application and the attached exhibit (s) are true and correct to 

the best of my knowledge and belief. Pursuant to Title 18 United States Code 

Section 1001, I [the individual signing the application, who shall be a principal 

owner, senior officer, or internal counsel of the applicant], in my individual 

capacity and as the authorized representative of the applicant, have not in any 

manner knowingly and willfully falsified, concealed or failed to disclose any 

material fact or made any false, fictitious, or fraudulent statement or knowingly 

used any documents which contain such statements in cormection with the 

preparation, filing or prosecution of the application. I understand that an 

individual who is found to have violated the provisions of 18 U.S.C section 1001 

shall be fined or imprisoned not more than five years, or both.