Frontier Airlines 2006 Annual Report Download - page 250

AIRLINE SERVICES AGREEMENT
This Airline Services Agreement (this “ Agreement”), dated as of January 11, 2007 (the “Effective Date”), is between
Frontier Airlines, Inc., a Colorado corporation (“Frontier”), Republic Airlines, Inc., an Indiana corporation (“RAI”), Frontier Airlines
Holdings, Inc., a Delaware corporation, solely with respect to Section 10.20 herein, and, Republic Airways Holdings Inc., a Delaware
corporation, solely with respect to Section 10.19 herein.
NOW, THEREFORE, in consideration of the foregoing premises and the mutual covenants and obligations hereinafter
contained, the parties agree to:
ARTICLE I
DEFINITIONS
Capitalized terms used in this Agreement (including, unless otherwise defined therein, in the Schedules, Appendices and
Exhibits to this Agreement) shall have the meanings set forth in Exhibit A hereto.
ARTICLE II
AIRLINE SERVICES, SCHEDULES AND FARES
Section 2.01 Capacity Purchase. Frontier agrees to purchase the capacity of each Covered Aircraft for the period
beginning on the date such aircraft is presented for service by RAI under this Agreement and ending on the last day of the Term, or as
such date may be extended pursuant to Section 10.17 hereof, in each case unless such aircraft is earlier withdrawn pursuant to Article
VIII, all under the terms and conditions set forth herein and for the consideration described in Article III. Subject to the terms and
conditions of this Agreement, RAI shall provide all of the capacity of the Covered Aircraft solely to Frontier and use the Covered
Aircraft solely to operate the Scheduled Flights. Except as provided in Section 2.01(e), the Covered Aircraft may not be used by RAI
for any other purpose without the express prior written consent of Frontier.
(a) Fares, Rules and Seat Inventory. Frontier shall establish and publish all fares and related tariff rules for all
seats on the Covered Aircraft. RAI shall not publish any fares, tariffs, or related information for the Covered Aircraft. In addition,
Frontier shall have complete control over all seat inventory and inventory and revenue management decisions for the Covered
Aircraft, including overbooking levels, discount seat levels and allocation of seats among various fare buckets.
(b) Flight Schedules. Frontier shall, in its sole discretion, establish and publish all schedules for the Covered
Aircraft (such scheduled flights, together with Charter Flights and ferry flights required to accommodate such scheduled flights and
Charter Flights or otherwise made at Frontier's request, referred to herein as “Scheduled Flights”), including determining the city-pairs
served, frequencies, utilization and timing of scheduled arrivals and departures, and shall, in its sole discretion, make all
determinations regarding the establishment and scheduling of any Charter Flights; provided that such schedules shall be subject to
Reasonable Operating Constraints. Frontier shall also be entitled, in its sole discretion and at any time prior to takeoff, to direct RAI to
delay or cancel a Scheduled Flight, including without limitation for delays and cancellations that are air traffic control or weather
related, and RAI shall take all necessary action to give effect to any such direction, provided, however, that such delays or
cancellations will not violate the minimum scheduling parameters of Exhibit G. Subject to the notice requirement set forth in Section
4.08 regarding international service, Frontier will provide RAI with a preliminary schedule in a Standard Schedule Input Message
(“SSIM”) file format 45 days prior to the first day of the month to which the preliminary schedule relates. RAI will review the
proposed schedule and provide feedback to Frontier no later than seven days following receipt of the preliminary schedule by RAI.
Frontier will send RAI a Final Monthly Schedule, together with operational assumptions for the month (the “Operational
Assumptions”), including without limitation the weighted average number of Covered Aircraft, estimated passengers, revenue
passenger miles, departures, block hours, and flights hours, based on the Final Monthly Schedule, no later than two Business Days
following receipt of RAI’s comments to the preliminary schedule. Following delivery of the Final Monthly Schedule, however,
Frontier may make such adjustments to the proposed Final Monthly Schedule as it deems appropriate (subject to Reasonable
Operating Constraints).
(c) Wet Leases. At Frontier's option, and provided that RAI is not adversely affected in any material respect, RAI
shall “wet lease” one or more of the Covered Aircraft to Frontier, on terms mutually acceptable to the parties hereto, which terms are
identical in all material respects, economically and otherwise, to the terms of this Agreement (taking into account the inherent
Source: REPUBLIC AIRWAYS HOLDINGS INC, 10-K, March 15, 2007 Powered by Morningstar® Document Research℠