SkyWest Airlines 2005 Annual Report Download - page 14

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10
In exchange for providing the designated number of flights and performing SkyWest Airlines’ obligations under the United
Express Agreement, SkyWest Airlines receives from United compensation (subject to an annual adjustment) of a fixed-fee per
completed block hour, fixed-fee per completed departure, fixed-fee per passenger, fixed-fee for overhead and aircraft costs, and
one-time start-up costs for each aircraft delivered. The United Express Agreement provides for incentives based upon SkyWest
Airlines’ performance, including on-time arrival performance and completion percentage rates. Additionally, certain of SkyWest
Airlines’ operating costs are reimbursed by United, including costs related to fuel and aircraft ownership and maintenance.
The United Express Agreement expires incrementally on December 31, 2011, 2013 and 2015. United has the option, upon one
year’s notice, of extending the United Express Agreement for five years. The United Express Agreement is subject to early
termination in various circumstances including:
• if SkyWest Airlines or United fails to fulfill an obligation under the United Express Agreement for a period of
60 days after written notice to cure;
• if SkyWest Airlines’ operations fall below certain performance levels for a period of three consecutive months;
• subject to limitations imposed by the U.S. Bankruptcy Code, if the other party becomes insolvent, fails to pay
its debts when due, takes action leading to its cessation as a going concern, makes an assignment of
substantially all of its assets, or ceases or suspends operations;
• if bankruptcy proceedings are commenced against the other party (subject to limitations imposed by the U.S.
Bankruptcy Code) and certain specified conditions are not satisfied; or
• if SkyWest Airlines operates, subject to certain exceptions, any additional regional jets or turboprop aircraft
pursuant to a marketing or code-share relationship with any party other than United to provide hub service at
United’s hubs in Chicago (O’Hare), Denver, Los Angeles, San Francisco, Seattle/Tacoma, or Washington, D.C.
(Dulles International Airport).
Markets and Routes
As of December 31, 2005, SkyWest Airlines scheduled the following daily flights as a United Express carrier: 300 to or from
Chicago O’Hare International Airport, 232 to or from Denver International Airport, 278 to or from Los Angeles International
Airport, 36 to or from Portland International Airport, 220 to or from San Francisco International Airport and 18 to or from
Seattle/Tacoma International Airport and 16 to or from other outlying airports.
As of December 31, 2005, SkyWest Airlines and ASA scheduled the following daily flights as a Delta Connection carriers: 684 to
or from Hartsfield-Jackson Atlanta International Airport and 564 to or from Salt Lake City International Airport and 124 to or from
Cincinnati/Northern Kentucky International Airport.
Our flight schedules are structured to facilitate the connection of our passengers with flights of our major partners at the
airports we serve. The following chart shows selected information about the cities and routes served by SkyWest Airlines and
ASA as of December 31, 2005.