SkyWest Airlines 2012 Annual Report Download - page 18

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• subject to limitations imposed by the U.S. Bankruptcy Code, if the other party makes a general
assignment for the benefit of creditors or becomes insolvent; or
• 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.
SkyWest Airlines US Airways Express Agreement
On November 17, 2011, SkyWest Airlines and US Airways entered into the SkyWest Airlines US
Airways Express Agreement. As of December 31, 2012, SkyWest Airlines operated 14 CRJ200s under
the SkyWest Airlines US Airways Express Agreement, flying a total of approximately 90 US Airways
Express flights per day between Phoenix and designated outlying destinations. Additionally, as of
December 31, 2012, SkyWest Airlines operated one CRJ200s under a revenue-sharing arrangement.
Generally, under the SkyWest Airlines US Airways Express Agreement, US Airways retains all air
fares, cargo rates, mail charges and other revenues associated with each flight.
In exchange for providing the designated number of flights and performing SkyWest Airlines’
obligations under the SkyWest Airlines US Airways Express Agreement, SkyWest Airlines receives from
US Airways compensation (subject to an annual adjustment) of a fixed fee per completed block hour, a
fixed fee per completed departure, a fixed fee per passenger, and a fixed fee for overhead and aircraft
costs. The SkyWest Airlines US Airways Express Agreement provides for incentives and penalties based
upon SkyWest Airlines’ performance, including on-time arrival performance and completion percentage
rates. Additionally, certain of SkyWest Airlines’ operating costs are reimbursed by US Airways,
including costs related to fuel and insurance.
The SkyWest Airlines US Airways Agreement is scheduled to terminate in 2015. The SkyWest
Airlines US Airways Express Agreement is subject to early termination in various circumstances
including:
• if SkyWest Airlines or US Airways fails to fulfill an obligation under the SkyWest Airlines US
Airways Express Agreement for a period of 30 days after written notice to cure;
• if SkyWest Airlines’ operations fall below certain performance levels;
• 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; or
• 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.
Markets and Routes
As of December 31, 2012, SkyWest Airlines and ExpressJet scheduled the following daily flights as
a United Express carrier: 610 flights to or from Houston International Airport, 425 flights to or from
Chicago O’Hare International Airport, 325 flights to or from Denver International Airport, 300 flights
to or from San Francisco International Airport, 250 flights to or from Los Angeles International
Airport, 275 flights to or from Newark International Airport, 150 flights to or from Washington Dulles
International Airport and 90 flights to or from Cleveland International Airport.
As of December 31, 2012, SkyWest Airlines and ExpressJet scheduled the following daily flights as
Delta Connection carriers: 530 flights to or from Hartsfield—Jackson Atlanta International Airport, 300
flights to or from Salt Lake City International Airport, 175 flights to or from Minneapolis International
Airport, 125 flights to or from Detroit International Airport, 70 flights to or from Memphis
International Airport and 50 flights to or from Cincinnati/Northern Kentucky International Airport.
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