Second Amendment to Republic Jet Service Agreement by and between USAirways
      and Republic Airline


     

     

    
      	
              EXHIBIT
                10.4

            
	
              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. 


    

     

    
 

    


    SECOND AMENDMENT
      TO

    REPUBLIC
      JET SERVICE AGREEMENT

    BETWEEN

    US
      AIRWAYS, INC.

    AND

    REPUBLIC
      AIRLINE INC.

    


    


    This Second
      Amendment (this “Second Amendment”) to the Republic Jet Service Agreement
      between US Airways, Inc. (“US Airways”) and Republic Airlines Inc. (“Republic”)
      dated as of September 2, 2005 (the “Agreement”) is made and entered into as of
      this 21st day of July, 2006.

    


    WHEREAS,
      US
      Airways and Republic have entered into the Agreement; and

    


    WHEREAS,
      US
      Airways and Republic wish to amend certain provisions of the Agreement on the
      terms and conditions set forth herein; and

    


    WHEREAS,
      US
      Airways and Chautauqua Airlines, Inc. (“Chautauqua”) are parties to that certain
      Amended and Restated Chautauqua Jet Service Agreement between US Airways, Inc.
      and Chautauqua Airlines, Inc., dated as of April 26, 2005 (the “Chautauqua
      Agreement”); and

    


    WHEREAS,
      contemporaneously herewith US Airways and Chautauqua are entering into a First
      Amendment to the Chautauqua Agreement (the “Chautauqua Amendment”);


    


    NOW
      THEREFORE,
      for and
      in consideration of the foregoing premises and the mutual covenants and
      obligations hereinafter set forth, and for other good and valuable
      consideration, the receipt and sufficiency of which is acknowledged, US Airways
      and Republic hereby agree as follows:

    


    1. Certain
      Definitions.
      All
      capitalized terms used but not defined herein shall have the meanings set forth
      in the Agreement. In addition, the following term shall have the meanings set
      forth below:

    


    “New
      Aircraft” - shall mean the 30 Embraer 175 aircraft to be placed into Service
      under the terms of this Second Amendment or such other aircraft as may be
      substituted therefore pursuant to the terms of Section 2.8 of the Agreement.
      The
“New Aircraft” shall be deemed included in the definition of “Aircraft” set
      forth in Section 2.1. Republic acknowledges that US Airways currently has orders
      and options with Embraer for Embraer 175 aircraft (the “US Airways’ Order/Option
      Aircraft”). US Airways and Republic shall cause Embraer to transfer the US
      Airways’ Order/Option Aircraft to Republic such that the New Aircraft to be
      placed into Service will be from the US Airways’ Order/Option Aircraft. Prior to
      delivery of any New Aircraft, Republic shall provide written evidence to US
      Airways of Embraer’s transfer of the US Airways’ Order/Option Aircraft to
      Republic.

    


    2. Certain
      Provisions of the Republic Agreement.
      The
      following provisions of the Republic Agreement shall apply to the New Aircraft
      mutatis mutandis: Article 1 (Compliance with Regulations); Article 2 (Air
      Transportation Services to be Provided by Republic), excluding Sections 2.9(a)
      and 2.14; Article 3 (Operation Under the “US Airways Express” Name); Article 4
      (US Airways’ Support Services and Facilities); Sections 5.1 through 5.7 of
      Article 5 (Purchase of Available Seat Miles (“ASMs”); Article 6 (Liability,
      Indemnification and Insurance); Sections 7.2, 7.3, 7.4 and 7.5 of Article 7
      (Term and Termination); Article 8 (Performance Adjustments); Article 9 (Service
      Mark License For Services Provided Pursuant to this Agreement); Article 10
      (Force Majeure); Section 12.8 of Article 12 (Miscellaneous) and Exhibit 2.2
      (Schedule Requirements).

    


    3. Spare
      Aircraft.
      Section
      2.9(a) of the Agreement shall be amended by deleting such section and replacing
      it with the following:

    


    “(a) Republic
      shall designate [*]
      of
      the
      EMB Aircraft, [*]
      of
      the
      New Aircraft until November 30, 2007 and a total of [*]
      of
      the
      New Aircraft after November 30, 2007 as “Spare Aircraft.” For the purposes of
      calculating the payment to Republic as described in Article 5 of this Agreement,
      Spare Aircraft shall not be included as Aircraft in Service, but US Airways
      shall pay to Republic certain associated Direct Costs as detailed in the Pricing
      Model, such as insurance, property taxes and aircraft ownership costs. For
      the
      purposes of calculating the schedule requirements as described in Exhibit 2.2
      to
      this Agreement, the Spare Aircraft shall not be included.”

     

    4. In
      Service Dates.
      The New
      Aircraft shall be placed into Service during the months set forth for each
      New
      Aircraft on Schedule 5.1(b) hereof. Republic shall provide US Airways with
      at
      least ninety (90) days’ prior written notice of the week each New Aircraft will
      be placed into Service and at least sixty (60) days’ prior written notice of the
      date on which each New Aircraft will be placed into Service.

    


    5. Pricing
      Model.
      The
      Agreement shall be amended by adding the Exhibit 5.1 - Pricing Model for EMB
      175s attached hereto. Payment of all sums due under Article 5 for each New
      Aircraft shall commence on the date each New Aircraft is first placed into
      Service. 

    _____________

    *Confidential


    
      
        
        

      

      
        -1-

        
          

        

      

      
        
        

      

    

     

    


    
      	
              6.

            	Term.
              Section 7.1(b) of the Agreement shall be amended by deleting such section
              and replacing it with the
              following:


    

     

    “The
      term
      of this Agreement (the “Term”) (i) with respect to the EMB Aircraft shall
      commence on September 4, 2005, and continue until September 4, 2015, and (ii)
      with respect to each New Aircraft shall commence on the in Service date of
      such
      New Aircraft and continue until the day prior to the twelfth (12th)
      anniversary of the date that such New Aircraft is first placed into Service,
      in
      all cases subject to the prior termination of this Agreement pursuant to Article
      7 hereof.”

     

    
      	
              7.

            	Notices.
              The persons to receive notices on behalf of US Airways in Article 11
              of
              the Agreement shall be deleted and replaced with the
              following:


    

     

    
      	Andrew Nocella 	with a copy delivered to:
	Senior Vice President - Planning 	Deputy General Counsel
	4000 E. Sky Harbor Boulevard 	4000 E. Sky Harbor Boulevard
	Phoenix, Arizona 85034 	Phoenix, Arizona 85034
	andrew.nocella@usairways.com	Fax: (480) 693-5932
	Telephone:
              (480) 693-8222	 
	Fax:
              (480) 693-5954	 


    

    


    
      	
              8.

            	Schedule Requirements.
              Exhibit 2.2 of the Agreement shall be amended as
              follows:


    

     

    (a) Section
      3
      of Exhibit 2.2 shall be deleted and replaced with the following:

     

        [*]

    


    (b) Each
      of
      Sections 4 and 7 of Exhibit 2.2 shall be amended to add [*]
      and
      either [*]
      or
[*]
      as
      Republic may elect pursuant to Section 3 of Exhibit 2.2, as
      amended.

    


    
      	
              9.


            	Modifications.
              Republic shall modify, at its sole expense, each of the existing EMB-170s
              from a seventy-two (72) to a seventy-six (76) seat configuration during
              the normal heavy check for each
              aircraft.


    

     

    Except
      as
      amended hereby, the Agreement remains in full force and effect and unchanged
      in
      all respects. Upon its execution by the parties, this Second Amendment
      together with the Agreement, will be the complete and binding understanding
      of
      the parties with respect to the subject matter hereof.

    


    (signature
      page follows)

     

    _____________

    *Confidential

     

    
      
        
        

      

      
        -2-

        
          

        

      

      
        
        

      

    

    


     

     

    
 

    IN
      WITNESS WHEREOF,
      US
      Airways and Republic have caused this Second Amendment to be executed by
      their duly authorized representatives on the day and year first above
      written.

     

     

    
 

     

    
      	REPUBLIC
              AIRLINE INC.	 	 	US
              AIRWAYS, INC.
	/s/ Bryan
              Bedford 	 	 	/s/ W.
              Douglas Parker
	
              

            	 	 	
              

            
	
              Name:
                Bryan Bedford
Title: President

               

            	 	 	Name:
              W. Douglas
              Parker
Title: Chairman, President &
CEO



    

     

    
 

    


    


    


    


     

     

     


    
      
        
        

      

      
        -3-

        
          

        

      

      
        
        

      

    


    Exhibit
      5.1 - Pricing Model for EMB 175s 

    [*]

    [*]


    
      	 	
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    * 
      Confidential

    


    


    
      
        
        

      

      
        -4-

        
          

        

      

      
        
        

      

    

     

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    ___________

    *Confidential


    
      
        
        

      

      
        -5-

        
          

        

      

      
        
        

      

    


    Exhibit
      5.1(a)

    


    
      [*]

    

    [*]

    


    
      	 	 	 	 	 	 	 
	
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    ___________

    *Confidential

    
      
        
        

      

      
        -6-

        
          

        

      

      
        
        

      

    

     

    
 

    Exhibit
      5.1 (b)

    E175
      Aircraft Delivery

    Schedule

    


     

    
      	
               Aircraft

            	
               In-Service

            	
               Aircraft

            	
               In-Service

            
	
               No.

            	
               Date

            	
               No.

            	
               Date

            


    

     

    
      	
              1

               

            	
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              16

               

            	
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              2

               

            	
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              17

               

            	
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              3

               

            	
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              18

               

            	
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              4

               

            	
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              19

               

            	
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              5

               

            	
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              20

               

            	
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              6

               

            	
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              21

               

            	
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              7

               

            	
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              22

               

            	
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              8

               

            	
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              23

               

            	
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              9

               

            	
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              24

               

            	
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              10

               

            	
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              25

               

            	
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              11

               

            	
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              26

               

            	
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              12

               

            	
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              27

               

            	
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              13

               

            	
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              28

               

            	
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              14

               

            	
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              29

               

            	
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              15

               

            	
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              30

               

            	
              [*]

               

            


    

    


    Note:
      The
      in-service dates reflect best estimates at the date of signing.

    Contractor
      will advise US Airways at least 30 days in advance of the

    actual
      in-service date of each E175 Aircraft

    


    _____________

    *
      Confidential

     

     

     

     

    
      
        
        

      

      
        -7-