Document:

exhibit10_40.htm

     

    
      Exhibit
        10.40(m)

      CONFIDENTIAL
        TREATMENT

      REQUESTED
        PURSUANT TO RULE 24b-2

      Execution
        Version

      

      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
      No. 13 TO LETTER AGREEMENT DCT-015/2004

    

    

    This
      Amendment No. 13 to Letter Agreement DCT-015/2004, dated as of October 18,
      2007
      (“Amendment No. 13”) relates to the Letter Agreement DCT-015/2004 (the “Letter
      Agreement”) between Embraer - Empresa Brasileira de Aeronáutica S.A. (“Embraer”)
      and Republic Airline Inc. (“Buyer”) dated March 19, 2004 and which concerns the
      Purchase Agreement DCT-014/2004 (the “Purchase Agreement”), as amended from time
      to time (collectively referred to herein as “Agreement”).  This
      Amendment No. 13 is between Embraer and Buyer, collectively referred to herein
      as the “Parties”.

    

    This
      Amendment No. 13 sets forth additional agreements between Embraer and Buyer
      related to the confirmation of 11 Option EMBRAER 170 Aircraft into 11 Firm
      EMBRAER 175 Aircraft.

     

    Except
      as
      otherwise provided for herein all terms of the Letter Agreement shall remain
      in
      full force and effect. All capitalized terms used in this Amendment No. 13
      that
      are not defined herein shall have the meaning given in the Letter Agreement.
      In
      the event of any conflict between this Amendment No. 13 and the Letter Agreement
      the terms, conditions and provisions of this Amendment No. 13 shall
      control.

    

     

    NOW,
      THEREFORE, for good and valuable consideration which is hereby acknowledged
      Embraer and Buyer hereby agree as follows:

    

    
      	
              1.  

            	
              Spare
                Parts Credit:

            

    

    

    
      	
               

            	
              1.1
                Article 1(ii) of the Letter Agreement shall be deleted and replaced
                by the
                following:

            

    

    

    
      	
               

            	
              “(ii)
                Spare Parts Credit:  Embraer will provide a spare parts
                (except for engines, engine related parts and APU), ground support
                equipment, test equipment credit and special services of ***.  This
                credit shall be made available to Buyer upon ***.  If for any reason
                *** then *** Buyer shall ***. *** shall only be made available to
                Buyer in
                the event there is no outstanding balance due from Buyer to Embraer
                related to the purchase of such Aircraft.  If *** credit is not so
                made available to Buyer because ***, such credit shall be made available
                at such time thereafter ***.  Any portion of such credit which
                remains unused *** shall be deemed to have been waived by Buyer,
                and no
                further compensation shall be due from Embraer to Buyer for such ***
                credit(s).  Such credit(s) shall be applied
                ***.

            

    

     

     

    
      	
              2.

            	Aircraft
              Purchase Price

    

     

    
      	
               

            	
              2.1
                Article 2.4 of the Letter Agreement *** for
                ***.

            

    

     

     

    
      	
              3.

            	***EMBRAER
              170 ***

    

    

    
      	
               

            	
              3.1
                Embraer shall provide to Buyer ***.
                Such *** shall ***.

            

    

    

    
      	
               

            	
              3.2
                Embraer shall provide to Buyer ***.

            

    

    

    
      	
               

            	
              3.3
                The *** mentioned above shall ***.

               

               

               

            

    

    ____________

    
      ***Confidential

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
      	
              4.

            	***EMBRAER
              170/175 ***

    

     

    

    
      	
               

            	
              4.1
                ***

            

    

    
      	
               

            	
               

            

    

    
      	
               

            	
              ***Embraer
                shall provide to Buyer ***. Such *** shall ***.

            

    

    

    
      	
               

            	
              ***Embraer
                shall provide to Buyer ***. ***Such *** shall ***.

            

    

    

    
      	
               

            	
              4.2
                ***

            

    

    

    
      	
               

            	
               Pursuant
                to *** are to be ***. Upon Buyer’s request, Embraer shall provide to Buyer
                ***. Such *** shall ***.

            

    

    

    
      	
               

            	
              ***Should
                the ***, Embraer shall ***.

            

    

     

    
      	 	***
	 	 
	
              5.

            	***

    

     

    
      	
              6.

            	***EMBRAER
              175 ***

    

     

    
      	
               

            	
              6.1
                Each of *** shall ***.

            

    

     

    
      	
               

            	
              6.2
                The ***shall be provided ***.

            

    

     

    
      	
              7.

            	***
	 	 
	
              8.

            	***

    

    

     

    All
      other
      provisions of the Letter Agreement which have not been specifically amended
      or
      modified by this Amendment No. 13 shall remain valid in full force and effect
      without any change.

    

    (Remainder
      of page intentionally left in blank)

    __________
*Confidential

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

              

                  
      

                  CONFIDENTIAL      
    

      

    

    

    IN
      WITNESS WHEREOF, EMBRAER and BUYER, by their duly authorized officers, have
      entered into and executed this Amendment No. 13 to Letter Agreement to be
      effective as of the date first written above.

    

    
      	
              EMBRAER
                – Empresa Brasileira de Aeronáutica S.A.

            	 	 	Republic
              Airline Inc.	 
	 	 	 	 	 
	
              By
                /s/ Falvio
                Rimoli

            	 	 	
              /s/
                Bryan
                Bedford

            	 
	
              Name:
                Flavio
                Rimoli

            	 	 	
              Name:
                Bryan
                Bedford

            	 
	
              Title:
                Executive Vice President & General Counsel 

            	 	 	
              Title:
                President 

            	 

    

    
      	 	 	 	 	 
	
              By
                /s/ José
                Luis D.
                Molina

            	 	 	
               

            	 
	
              Name:
                José
                Luis D.
                Molina

            	 	 	
               

            	 
	
              Title:
                Vice
                President Contracts Airline Market

            	 	 	
               

            	 

    

     

    
      	 	 	 	 	 
	
              Date:
                October
                18, 2007

            	 	 	
              Date:
                October
                18, 2007

            	 
	
              Place:
                San
                José
                Dos Campos, S.P.

            	 	 	
              Place:
                Indianapolis, IN

            	 
	
               

            	 	 	
            	 

    

     

    
      	 	 	 	 	 
	
              Witness: 
                Fernando Bueno

            	 	 	
              Witness:Lars
                - Erik Arnell

            	 
	
              Name:
                Fernando Bueno

            	 	 	
              Name:
Lars
                -
                Erik Arnellexhibit10_41.htm

    

      Exhibit
        10.41(a)

      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.

     

    FIRST
      AMENDMENT TO UNITED EXPRESS AGREEMENT

     

    This
      First Amendment to the United Express Agreement (the
“Amendment”) is effective as of August 21st,
      2007 by and
      between UNITED AIR LINES, INC., a Delaware corporation, with
      its operations center located at 1200 East Algonquin Road, Elk Grove Township,
      Illinois 60007 (“United”), and SHUTTLE America
      Corp., having its principal mailing address at 8909 Purdue Road, Suite 300,
      Indianapolis, IN 46268 (“Contractor”).

    

    WHEREAS,
      the parties previously entered into that certain United Express Agreement dated
      as of December 28th, 2006, United Contract # 172884 (the “Agreement”);
      and

    

    WHEREAS,
      pursuant to Article XXXI of the Agreement, the parties may modify or amend
      the
      Agreement; and

    

    WHEREAS,
      Article II of the Agreement provides for the term of all ERJ-170 regional jet
      aircraft subject to the Agreement; and

    

    WHEREAS,
      Article IV of the Agreement provides for the type and amount of aircraft to
      be
      used in the Agreement as outlined in Appendix B; and

    

    WHEREAS,
      Article VIII of the Agreement provides for an annual adjustment factor to
      carrier controlled rates payable to the contractor as outlined in Appendix
      E and
      for specific aircraft ownership Amended credits; and

    

    WHEREAS,
      Appendix B provides for the schedule of a Fleet Plan; and

    

    WHEREAS,
      Appendix E provides for the schedule of Reimbursement Category Unit Rates and
      Annual Adjustment Factors; and

    

    WHEREAS,
      the parties desire to amend the Agreement to provide for the addition of ten
      (10) ERJ-170 aircraft by Contractor in accordance with the Fleet Plan set forth
      on Appendix B.

    

    NOW
      THEREFORE, for good and valuable consideration, the receipt and sufficiency
      of
      which are hereby acknowledged, the parties hereby agree as follows:

    

    I.           DEFINITIONS

    

    A.           Defined
      Terms.  Capitalized terms used in this Amendment and not otherwise
      defined in this Amendment shall have the meanings assigned to them in the
      Agreement.

    

    

    II.           SCOPE,
      TERM, and CONDITIONS

    

    A.           Contractor
      and United have mutually agreed to add ten (10) ERJ-170 aircraft (aircraft
      [*]
      through [*]).

    

    B.           Article
      II.B.1 Regional Jets Term of the Agreement shall be deleted in its entirety
      and
      replaced with the following:  For any ERJ-170 regional jet aircraft
      subject to this Agreement, the aircraft shall be divided into four (4)
      tranches.  The term of this Agreement for the first ERJ-170 tranche
      (the first [*] aircraft delivered) shall expire on June 30, 2016.  The
      term of the Agreement for the second ERJ-170 tranche (the next [*] aircraft
      delivered) shall expire on June 30, 2017.  The term of the Agreement
      for the third ERJ-170 tranche (the next [*] aircraft delivered) shall expire
      on
      June 30, 2018.  The term of the Agreement for the fourth ERJ-170
      tranche (the final [*] aircraft delivered) shall expire on June 30,
      2019.

    

    C.           Article
      IV.A.1.a.i Aircraft Types of the Agreement shall be deleted in its entirety
      and
      replaced with the following: [*] ERJ-170 aircraft which Contractor shall cause
      to be delivered in a timeline substantially consistent with the schedule set
      forth on Appendix B.

    

    D.           Article
      VIII.A.5, Annual Adjustment Factors, of the Agreement shall be deleted in its
      entirety and replaced with the following:  Effective as of January
      1st, 2008 and each January 1st thereafter for the term of this Agreement,
      Contractor and United agree to increase or leave constant all Carrier Controlled
      Costs, excluding aircraft ownership, within the Reimbursement Categories for
      the
      ensuing contract year by an amount equal to the then applicable Carrier
      Controlled Costs multiplied by the applicable “Annual Adjustment Factors” as set
      forth on Appendix E.  Rates shall be adjusted in accordance with the
      procedures set forth in Appendix E.  Except as expressly provided in
      this Agreement, the parties do not want to perform, and have not provided for
      ,
      any additional rate changes, rate negotiations or rate setting
      process.  Annual CPI increases (if any) are to be capped at [*] for
      the period of [*] through [*].  If during any year during this period
      of this Agreement, CPI is negative, the rates that are subject to CPI adjustment
      for such year will remain unchanged.  Annual CPI increases (if any)
      are to be capped at [*] for the period of [*] through [*].  If during
      any year during this period of this Agreement, CPI is negative, the rates that
      are subject to CPI adjustment for such year will remain
      unchanged.  Example:  If as of January 1, 2008, the rate for
      the Completed Block Hours Reimbursement Category is [*] per block hour and
      the
      CPI adjustment factor is [*], then the annual Carrier Controlled Cost element
      effective as of such anniversary of this Agreement shall be [*] ([*] multiplied
      by [*]).

    

    E.           Contractor
      and United mutually agree that notwithstanding the provisions in Article
      VIII.A.8.b, Amended Credit, the two (2) references to “[*] aircraft” in such
      paragraph shall be amended such that in the [*] in which the [*] of the [*]
      ERJ-145 aircraft operating for Chautauqua Airlines are removed from service,
      the
      article will be amended to reference “[*] Aircraft” and will be reduced by [*]
      aircraft in conjunction with the early termination schedule of the remaining
      ERJ-145 aircraft, accordingly such reference should not fall below “[*]
      aircraft”, and will remain in effect through [*].  As of [*], Article
      VIII.A.8.b, Amended Credit, will revert to incorporate the initial references
      to
“[*] aircraft”.

     

    ____________

    *Confidential

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    F.           Contractor
      and United mutually agree to the monthly aircraft ownership rate of [*] per
      additional ERJ-170 as specified in this Amendment and as outlined in Attachment
      B to this Amendment, the revised iteration of Appendix E to the
      Agreement.

    

    G.           Attachment
      A to this Amendment is the revised iteration of Appendix B to the Agreement
      and
      is modified to include specifics to the additions in fleet and the related
      additions in schedule of aircraft.

    

    H.           Attachment
      B to this Amendment is the revised iteration of Appendix E to the Agreement
      and
      is modified to include specifics to the annual adjustment rates and aircraft
      ownership rates.

    

    III.           MISCELLANEOUS.      Except
      as otherwise amended herein, the Agreement will remain in full force and
      effect.  The terms of this Amendment are deemed to be incorporated in,
      and made a part of, the Agreement.  This Amendment may be executed in
      any number of counterparts, by original or facsimile signature, each of which
      when executed and delivered shall be deemed an original and such counterparts
      together shall constitute one and the same instrument.

    

    

    [Signature
      Page Follows]

    
 

     _________ 
      *
        Confidential

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

              

                  Execution
            Version      
    

      

    

    IN
      WITNESS WHEREOF, the parties hereto have by their duly authorized officers
      caused this Amendment to be entered into and signed as of the day and year
      first
      above written.

     

     

     

    
      	UNITED
              AIRLINES, INC.	 	 	SHUTTLE
              AMERICA CORP.	 
	 	 	 	 	 
	
              /s/
                Pete
                McDonald

            	 	 	
              /s/
                Bryan K.
                Bedford

            	 
	
              Name:
                Pete
                McDonald

            	 	 	
              Name:
                Bryan K.
                Bedford 

            	 
	
              Title:
                Executive Vice President & Chief Operating
                Officer 

            	 	 	
              Title:
                Chief
                Executive Officer

            	 

    

     

    
      	 	 	 	 	 
	
              /s/
                Alex
                Marren

            	 	 	
               

            	 
	
              Name:
                Alex
                Marren

            	 	 	
               

            	 
	
              Title: Vice
                President
                Operational Services 

              United
                Express and TED 

            	 	 	
               

            	 

    

     

    
      	
               

               

            	
               

              
              

            
	
               

              
              

            	 

    

    

    
      
              

                  
      
      

                     
    

        
        

      

      
        
        

        
          

        

      

      
        
        

              

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    ATTACHMENT
      A

     

    APPENDIX
      B

     

    RJ-
      70FLEET PLAN

    
      	
              Delivery
                Dates

            	 	 	
              Units

            	
              In-Service

            	
              Spare

            	
              Total
                Deliveries

            
	 	 	 	 	 	 	 
	
              10/17/2004

            	 	 	
              3

            	
              2

            	
              1

            	
              3

            
	
              11/1/2004

            	 	 	
              2

            	
              4

            	
              1

            	
              5

            
	
              11/21/2004

            	 	 	
              2

            	
              6

            	
              1

            	
              7

            
	
              12/1/2004

            	 	 	
              1

            	
              7

            	
              1

            	
              8

            
	
              12/19/2004

            	 	 	
              2

            	
              9

            	
              1

            	
              10

            
	
              1/2/2005

            	 	 	
              2

            	
              11

            	
              1

            	
              12

            
	
              1/16/2005

            	 	 	
              1

            	
              12

            	
              1

            	
              13

            
	
              2/1/2005

            	 	 	
              1

            	
              13

            	
              1

            	
              14

            
	
              3/1/2005

            	 	 	
              1

            	
              14

            	
              1

            	
              15

            
	
              4/1/2005

            	 	 	
              1

            	
              15

            	
              1

            	
              16

            
	
              5/1/2005

            	 	 	
              1

            	
              16

            	
              1

            	
              17

            
	
              6/1/2005

            	 	 	
              1

            	
              17

            	
              1

            	
              18

            
	
              6/12/2005

            	 	 	
              1

            	
              18

            	
              1

            	
              19

            
	
              7/1/2005

            	 	 	
              1

            	
              19

            	
              1

            	
              20

            
	 	 	 	 	 	 	 
	
              6/7/2005

            	 	 	
              1

            	
              19

            	
              2

            	
              21

            
	
              6/25/2005

            	 	 	
              1

            	
              20

            	
              2

            	
              22

            
	
              7/1/2005

            	 	 	
              1

            	
              21

            	
              2

            	
              23

            
	
              Sep-05

            	 	 	
              1

            	
              22

            	
              2

            	
              24

            
	
              Oct-05

            	 	 	
              1

            	
              23

            	
              2

            	
              25

            
	
              Nov-05

            	 	 	
              1

            	
              24

            	
              2

            	
              26

            
	
              Nov-05

            	 	 	
              1

            	
              25

            	
              2

            	
              27

            
	
              Dec-05

            	 	 	
              1

            	
              26

            	
              2

            	
              28

            
	 	 	 	 	 	 	 
	
              [*]

            	 	 	
              
                [*]

              

            	
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              [*]

            
	
              Note:
                Contractor shall not be liable for any aircraft delivery delays resulting
                from verifiable manufacturer

            
	
              caused
                actions.

            	 	 	 	 	 	 

    

    

    
 

     _________ 
      *
        Confidential

    

    
      
              

                  
      
      

                       
    

        
        

      

      
        
        

        
          

        

      

      
        
        

              

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    ATTACHMENT
      B

     

    APPENDIX
      E

     

    REIMBURSEMENT
      CATEGORIES

    

    CARRIER
      CONTROLLED COSTS IN 2007 ECONOMICS

    

    United
      shall pay Contractor the
      following Reimbursement Category Unit Rates for Contractor’s United Express
      flights operated using the aircraft set forth below:

    

 

    
      
        	
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       _________ 
        *
          Confidential

      

      
        
                

                    
      
      

                        
    

          
          

        

        
          
          

          
            

          

        

        
          
          

                

                    Execution
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    REIMBURSEMENT
      CATEGORIES

    

     

    PASS-THRU
      COSTS

    

    
      	 	 	 	 
	
              
                [*]

              

            	
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              [*]

            	
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              [*]

            	
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              [*]

            	
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     _________ 
      *
        Confidential

    

    
      
              

                  
      
      

                      
    

        
        

      

      
        
        

        
          

        

      

      
        
        

              

                  Execution
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    DEFINITIONS

     

     

    Descriptions
      of Carrier Controlled Costs

     

    General
      Statement:  Notwithstanding the following descriptions, any
      costs incurred by Contractor that are described as Pass-Through Costs on this
      Exhibit E shall not be considered Carrier Controlled Costs.  Any costs
      incurred by Contractor that are not Pass-Through Costs under the Agreement,
      regardless of whether such costs are described below, shall be considered
      Carrier Controlled Costs, except for those costs that are typically considered
      the responsibility of the Ground Handling Provider as defined in United’s
      contracts for ground handling services.  The characterization of any
      cost as a Carrier Controlled Cost in the following descriptions shall not impair
      any provision of the Agreement that specifically requires United to reimburse
      Contractor for such cost.

     

    i)  Flight
      Crews (Captains, First Officers and Flight Attendants)

     

    a)  Wages,
      benefits (including health insurance, pensions, 401k, and any other benefits),
      payroll associated taxes and incentives (premiums for longevity, geography,
      certificates/licenses, profit sharing, bonuses and any other incentives) for
      all
      paid hours (including but not exclusive of hours for reserve employees,
      overtime, vacation, holidays, sick days, and paid leave) for the following
      work
      categories:

     

    ii)  Pilots
      and Flight Attendants for all equipment types, including reserve crews and
      any
      other crews on the Contractor payroll.

     

    iii)  Pilot
      and
      Flight Attendant Administration and Management, including senior management
      crew
      scheduling, labor relations management.

     

    iv)  Domicile
      administration.

     

    a)  All
      uniform related charges for all of the above work categories, including
      purchase, repair, and cleaning charges.

     

    b)  All
      training associated with the work groups above, including but not exclusive
      of:

     

    v)  Recurring
      and Attrition:  Any training expense that occurs annually for all
      types of employees, new planes or attrition.  Includes Labor payments
      to those employees being trained (including all types of charges mentioned
      in
      paragraph i.a), trainer time and salary, equipment and facility rental, training
      administration costs associated with recurring training, and any training
      materials required. Excludes expenses associated with bringing new aircraft
      into
      the system.

     

    vi)  Ramp-up:  Training
      expense that occurs due to new planes taken on.  Includes Labor
      payments to those employees being trained (including all items in paragraph
      i.a); Trainer time and salary; Equipment and facility rental; Training
      administration costs associated with one-time training; Any training materials
      required; Uniforms & headsets; Pilot navigational charts.

     

    vii)  Maintenance:

     

    a)  Maintenance
      labor for all labor categories of aircraft mechanics, (e.g., engine specialists,
      parts clerks, etc.), including base wages, benefits, payroll associated taxes
      and incentives (premiums for longevity, geography, certificates/licenses, profit
      sharing, bonuses and any other incentives) for all paid hours (including but
      not
      exclusive of overtime, holidays, vacation, sick days and paid
      leave).

     

    b)  Maintenance
      Overhead:  All hangar, parts/storage shop and maintenance management
      office rent and maintenance facility charges. All sundry and clerical items
      associated with the management of Contractor’s maintenance function, including
      but not exclusive of office supplies and furniture, maintenance schematic
      drawings and manuals, maintenance IT hardware/software.

     

    c)  Maintenance
      Management Overhead: Labor for all management and administration associated
      with
      the Contractor’s management of the maintenance function, including base wages,
      benefits, payroll associated taxes and incentives (including premiums for
      longevity, geography, certificates/licenses, profit sharing, bonuses and any
      other incentives) for all paid hours (including but not exclusive of overtime,
      vacation, holidays, sick days and paid leave).

     

    d)  Outsource
      Maintenance Services: All charges net of warranty reimbursement for any and
      all
      services and/or products (including but not exclusive of components, line,
      engine, airframe, C&D checks, avionics, APU) provided by a third party for
      the maintenance of Contractor’s aircraft or maintenance functions.

     

    e)  Other
      Maintenance: Parts, spares, tools, equipment and any other personnel, service
      or
      material expenses, associated with the maintenance of Contractor’s aircraft or
      maintenance functions.

     

    viii)  Operations

     

    a)  RON
      (Remain Over Night):  Hotel, transportation, and per diem for all
      pilots and flight attendants.

     

    b)  Interrupted
      Trip Expense:  Includes all mishandled bag related expenses and all
      hotel, transportation and meal accommodation expenses for any passenger
      traveling on Contractor’s flights.

     

    c)  Catering
      and on-board services:  Includes all cost associated with providing
      food (snack and beverage service) for passengers, excluding liquor. This
      includes but is not limited  to costs for the food and beverages,
      catering supplies

     

    d)  Crew
      Scheduling:  Labor for all management and administration associated
      with the Contractor’s crew scheduling function, including base wages, benefits,
      payroll associated taxes and incentives (including premiums for longevity,
      geography, certificates/licenses, profit sharing, bonuses and any other
      incentives) for all paid hours (including but not exclusive of overtime,
      vacation, holidays, sick days and paid leave).  All Information
      Technology related charges (e.g., systems, software and hardware) and other
      costs associated with crew scheduling functions.

     

    e)  Dispatch/flight
      operations center:  Flight operations center and all costs associated
      with it including personnel, facilities, management and systems.

     

    ix)  Corporate
      Overhead

     

    a)  Headquarters
      Facilities: All corporate real estate rent and associated facility
      charges

     

    b)  Management
      overhead: Labor for all management and administration whether or not based
      in
      Indianapolis, Indiana, including base wages, benefits, payroll associated taxes
      and incentives (including premiums for longevity, geography,
      certificates/licenses, profit sharing, bonuses and any other incentives) for
      all
      paid hours (including but not exclusive of overtime, vacation, holidays, sick
      days and paid leave).

     

    c)  Other:
      Out-sourced corporate overhead services (e.g., consulting, legal expenses),
      other depreciation and any other overhead costs spread over multiple cost
      categories (e.g., memberships, office supplies, employee testing, IT, insurance
      costs that are not Pass-Through Costs, other repairs and maintenance, software
      licensing, parking, safety office, flight standards, communications, etc.);
      includes non-aircraft interest expense, if any.

     

    x)  Aircraft
      Ownership

     

    a)  All
      charges, except Aircraft Property Taxes (as described in the description of
      Pass-Through Costs), associated with aircraft ownership including but not
      exclusive of lease, depreciation, other financing expense, and related start-up
      costs (including painting).

     

    b)  All
      spare
      engine ownership expense

     

    c)  Hull
      Insurance – consists of premiums and other charges of insurers for Aircraft Hull
      All Risks Insurance as described in the Agreement, plus fees and expenses of
      insurance brokers in connection with the procurement or maintenance of such
      insurance, and surplus lines tax.

     

    

     

    Descriptions
      of Pass-Through Costs

     

    
      	
              1.  

            	
              Fuel
                and Oil – consists of the cost of all aircraft fuel and oil, plus fuel
                flow charges, into-plane fees, and de-fueling charges, and all applicable
                taxes on any of the foregoing.

            

    

     

    
      	
              2.  

            	
              Landing
                Fees – consists of all airport landing fees, Aircraft Rescue Fire Fighter
                (ARFF) charges or similar charges, apron fees, and any other fees
                charged
                by airport operators to cover airfield costs or other airport
                facilities.

            

    

     

    
      	
              3.  

            	
              War
                Risk Insurance – consists of premiums and other charges of insurers for
                War Risk and Allied Perils Insurance, plus fees and expenses of insurance
                brokers in connection with the procurement or maintenance of such
                insurance.

            

    

     

    
      	
              4.  

            	
              Liability
                Insurance – consists of premiums and other charges of insurers for all
                other liability insurance as described in the Agreement, plus fees
                and
                expenses of insurance brokers in connection with the procurement
                or
                maintenance of such insurance.

            

    

     

    
      	
              5.  

            	
              Aircraft
                Property Taxes – consists of all property taxes (however designated,
                including excise or franchise taxes imposed on the ownership of property,
                ad valorem taxes, and special assessments or levies) related to aircraft,
                spare parts and engines.

            

    

     

    
      	
              6.  

            	
              Security
                Charges – consists of all charges imposed by governmental agencies,
                including the Transportation Security Administration (TSA) or any
                other
                entity performing functions of the TSA, or by any third-party contractor
                of any governmental agency, with respect to airport security
                services

            

    

     

    
      	
              7.  

            	
              Engine
                LLP Coverage – a part with a limitation on use stated in cumulative engine
                flight hours or cycles, established by the OEM or the Federal Aviation
                Administration.

            

    

     

    
      	
              8.  

            	
              [*]

            

    

     

    

    
 

     _________ 
      *
        Confidential

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