UNITED STATES OF AMERICA DEPARTMENT OF TRANSPORTATION OFFICE OF THE SECRETARY WASHINGTON, D.C.

Order 2012-1-11 Served: January 17, 2012 UNITED STATES OF AMERICA DEPARTMENT OF TRANSPORTATION OFFICE OF THE SECRETARY WASHINGTON, D.C. Issued by the Department of Transportation on the 17 th day of January, 2012 Applications of UNIVERSAL JET AVIATION, INC. for certificates of public convenience and necessity under 49 U.S.C. 41102 to engage in interstate and foreign charter air transportation Dockets DOT-OST-2011-0150 and DOT-OST-2011-0151 ORDER TO SHOW CAUSE PROPOSING ISSUANCE OF CERTIFICATES Summary By this order, we tentatively conclude that Universal Jet Aviation, Inc. ( Universal ), is fit, willing, and able to provide interstate and foreign charter air transportation of persons, property, and mail using one large aircraft, 1 and should be issued certificates of public convenience and necessity authorizing such operations, subject to conditions. Background Section 41102 of Title 49 of the United States Code ( the Transportation Code ) directs us to determine that applicants for certificate authority to provide interstate and foreign charter air transportation of persons, property and mail are fit, willing, and able to perform such transportation and to ensure that all operations relating to this authority conform to the provisions of the Transportation Code and the regulations and requirements of the Department. In making fitness findings, the Department uses a three-part test that reconciles the Airline Deregulation Act s liberal entry policy with Congress concern for operational safety and consumer protection. The three areas of inquiry that must be addressed in order to determine a company s fitness are whether the applicant (1) will have the managerial skills and technical ability to conduct the proposed operations, (2) will have access to resources sufficient to commence operations without posing an undue risk to consumers, and (3) will comply with the Transportation Code and regulations imposed by Federal and State agencies. We must also find that the applicant is a U.S. citizen. 1 Large aircraft is defined as any aircraft originally designed to have a maximum passenger seating capacity of more than 60 seats or a maximum payload capacity of more than 18,000 pounds.

2 On August 15, 2011, Universal Jet filed applications in Dockets DOT-OST-2011-0150 and DOT-OST-2011-0151 requesting certificates issued under 49 U.S.C. 41102, authorizing it to provide interstate and foreign charter air transportation of persons, property, and mail. Universal Jet accompanied its applications with information required by section 204.3 of our regulations for an examination of its fitness to hold such authority. 2 Additionally, on August 15, 2011, Universal Jet filed an application in Docket DOT-OST-2011-0152 requesting a pendente lite exemption from Part 298 to allow it to operate one 16-seat executive configured Boeing Business Jet ( BBJ ), 3 registration number N920DS, in on-demand charter operations pending the Department s action on the above mentioned applications for interstate and foreign passenger charter authority. On August 17, 2011, the Department granted a limited exemption to allow Universal Jet to operate one BBJ through November 30, 2011, in on-demand air transportation as an air taxi. 4 On November 20, 2011, Universal Jet applied for a renewal to the abovementioned limited exemption, which the Department subsequently granted on November 30, 2011. 5 We have received no answers to the applications and no special issues regarding the applicant have come to our attention. Under these circumstances, we propose to decide the issue of Universal Jet s fitness on the basis of the written record. As discussed below, we tentatively conclude that Universal Jet is a U.S. citizen and is fit, willing, and able to operate its proposed air service, subject to conditions. However, we will give interested persons an opportunity to show cause why we should not adopt as final these tentative findings and conclusions. The Applicant FITNESS Universal Jet is a corporation organized under the laws of the State of Florida. The air carrier, headquartered in Boca Raton, Florida, has operated as an air taxi under Part 298 since 1999, and holds a Part 135 Federal Aviation Regulation ( FAR ) operating certificate from the Federal Aviation Administration ( FAA ). It operates a fleet of 11 Gulfstream business jets, 1 Learjet, and 1 Bell helicopter. The air carrier states it is a U.S. citizen and that its sole shareholder and President, Mr. Michael McCauley, is a U.S. citizen. If granted the certificates it seeks, Universal Jet intends to operate one BBJ in an executive configuration of 16 seats, in interstate and foreign charter operations. 2 3 Universal Jet filed additional information supplementing its applications on August 30 and October 7, 2011. Normally, aircraft with only 16 seats would not require certificate authority since such aircraft generally qualify as small aircraft that can be operated under the Part 298 air taxi exemption. However, the BBJ, which is a modified B-737, is a large aircraft, which do not qualify for the air taxi exemption. Thus, Universal Jet has applied for certificates to allow it to operate a large aircraft. 4 See Order 2011-8-19. Universal s exemption request and application for certificate authority followed the Department s discovery that the carrier s addition of the BBJ to its air taxi registration had been accepted in error. The limited exemption was granted solely to permit Universal to carry out contracts for which it already was obligated. 5 See Order 2011-11-34 allowing Universal Jet s limited exemption to be extended to February 29, 2012.

3 Managerial Competence President, Treasurer, and Secretary Director of Operations Chief Pilot Director of Maintenance Chief Inspector Director of Safety Michael W. McCauley Richard C. Peck Nicholas T. Reinardy William K. Marsar James W. Stedman, Jr. Josh Fenton Mr. Michael W. McCauley, Universal Jet s President, Treasurer, and Secretary since 1995, holds an Airline Transport Pilot license and has logged over 12,500 flight hours. He previously served as Director of Flight Operations with Appletree Air, Inc. (1994-1995), and Senior Captain with Hop-A-Jet, Inc. (1984-1994). Mr. McCauley also is a licensed Check Airman and Airframe and Powerplant Mechanic. Mr. McCauley also owns a 50 percent interest in the following aviationrelated businesses: Executive Jet Services, Inc., a FAA Part 145 repair station; FM Holding Group LLC, an aircraft holding company; and BDM Holdings LLC, an aviation services company. Mr. Richard C. Peck has served as Universal Jet s Director of Operations since 2007. A licensed Airline Transport Pilot and Check Pilot, Mr. Peck is also the Assistant Director of Operations for Ventura Air Services (2005-Present), and an Aviation Consultant with Aviation Law Experts, LLC (2005-Present), positions he holds on a part time basis. Previously the Airport Operations Manager for Fort Lauderdale-Hollywood International Airport (2006-2010), Mr. Peck was employed by the FAA for 33 years, holding various positions, including Aircrew Program Manager (1998-2005), Principal Operations Inspector (1994-1998), Operations Unit Supervisor (1989-1994), Staff Specialist-Compliance and Enforcement (1982-1989), Air Traffic Controller (1981-1982 and 1974-1978), and Aviation Safety Inspector (1978-1981). Mr. Peck also was an Operating Engineer for DIC Underhill (1971-1974) and served in the United States Army (1967-1970). Mr. Nicholas T. Reinardy, Universal Jet s Chief Pilot, joined Universal Jet in 1999. A licensed Airline Transport Pilot with over 8,720 flight hours, he is also a Captain and Check Airman for the air carrier. He previously was a Flight Instructor with Professional Flight Training (1998-1999). Mr. William K. Marsar has been Universal Jet s Director of Maintenance since April 2011. A licensed Airframe and Powerplant Mechanic, Mr. Marsar was previously the Director of Maintenance with Executive Jet Services, Inc. (January 2011-April 2011) and General Manager/Director of Maintenance with Logos Aviation Services, Inc. (January 2007-January 2011). He was also a Site Manager for Elite Line Services (February 2005-January 2007), and worked for American Airlines (August 1985-December 2004) as a Production Manager, Production Supervisor, and Airline Mechanic. Additionally, Mr. Marsar was a Machinist in the United States Navy (1976-1979). Mr. James W. Stedman, Jr. is Universal Jet s Chief Inspector, a position he has held since June 2011. He is also the Vice President of Avionics for Sky Theater Design Group LLC (2005-

4 present), and the Owner and Chief Executive Officer of Prodigious Avionics (2005-present). Mr. Stedman has held various aviation and avionics-related positions, including Airworthiness Inspector with General Dynamics Aviation Services (2010-2011); Avionic Manager/Chief Inspector with Logos Aviation Services (2007-2010); Vice President of Avionics with Reliance Aviation (2005); Avionics Technician with Jet Aviation (2004-2005); Avionics Manager with Banyan Air Service (2004); Avionics Manager with Savannah Air Center LLC (2001-2004); Lead Avionics Technician with Gulfstream Aerospace (1997-2001); and Avionics Technician with PEMCO Aeroplex (1996-1997). Mr. Stedman served in the United States Navy (1985-1994). Mr. Josh Fenton has been Director of Safety at Universal Jet since 2005, and is also the air carrier s Assistant Director of Operations and a licensed Airline Transport Pilot with over 5,000 flight hours. Mr. Fenton previously was a Pilot with Raytheon Flight Options (2002-2005) and Capital Aviation Group (1999-2001). Universal Jet states that all its key personnel are U.S. citizens. Additionally, the FAA has advised us that Universal Jet s key technical personnel have been approved by that agency to hold their positions, 6 the air carrier has conducted its operations satisfactorily, and it has no objection to the Department s approval of Universal Jet s application for certificate authority. In light of these facts, we tentatively conclude that Universal Jet has the management skills and technical ability to conduct its proposed interstate and foreign charter air transportation operations using one large aircraft. However, we propose to restrict Universal Jet s initial large aircraft operations to the single aircraft proposed in its application. Should Universal Jet wish to add additional large aircraft to its operations at some later date, it would first need to have its fitness for such operations determined. 7 Operating Plan and Financial Position As previously noted, Universal Jet currently provides on-demand charter air transportation with a fleet of 12 small aircraft and a helicopter operated under Part 135 and Part 298 of our regulations. The applicant states that it will predominately operate the BBJ under a single longterm block charter contract, as well as offer regular on-demand charters to other third party customers, similar to the services it currently provides with its smaller jet aircraft. The air carrier currently manages the BBJ on behalf of Delaware Global Operation, LLC ( Delaware Global ) pursuant to an Aircraft Management Agreement. Under this agreement, Delaware Global pays all operating costs associated with the aircraft and an administration fee for managing the aircraft. In turn, Universal Jet performs all management functions associated with maintaining 6 Before authorizing an air carrier to conduct air transportation operations, the FAA evaluates the qualifications of persons holding certain positions with respect to the minimum qualifications for those positions as prescribed in the FARs. The FAA s evaluation of these key personnel provides an added practical and in-person test of their skills and technical ability. 7 In the context of such a review, we would also evaluate Universal Jet s financial fitness to conduct expanded operations.

5 and operating the aircraft and receives a management fee. Additionally, Universal Jet will retain 10 percent of the charter revenues from the BBJ charter operations. Historical financial statements submitted in support of Universal Jet s fitness show that for calendar year 2008, it posted a net loss of $159,967 on approximately $17.91 million in operating revenues. For calendar year 2009, Universal Jet posted a net loss of $269,282 on approximately $19.57 million in operating revenues, and for calendar year 2010, Universal Jet posted a net loss of $152,917 on approximately $19.46 million in operating revenues. Despite its past losses, Universal Jet s most recent income statement for the 7 months ended July 31, 2011 indicates some improvement, with net income of $1.39 million on approximately $25.91 million in operating revenues. In addition, while the air carrier s most recent balance sheet indicates that, as of July 31, 2011, it had current assets of $973,225 and current liabilities of $3.81 million, giving the company a negative working capital balance of $2.83 million, Universal Jet states that it anticipates full satisfaction of approximately $1.08 million of its $3.81 million in current liabilities within the next 12 months. 8 To meet the Department s financial fitness criteria, an applicant should have access to financial resources sufficient to cover its pre-operating expenses and the expenses that are reasonably projected to be incurred during three months of normal operations. 9 Universal Jet provided the Department with a financial forecast for its first year of operations with its BBJ and stated that it has already completed all pre-operating requirements to add the aircraft to its FAA Operating Specifications. In support of its financial fitness, Universal Jet states that it will not directly incur any operating expenses due to the structure of the aircraft management agreement in place with Delaware Global. The air carrier notes that as part of its aircraft management agreement, Delaware Global is responsible for the aircraft operating costs, including but not limited to: fuel, insurance, catering, maintenance, flight phone, crew travel expenses, flight crew costs, parking, and parts and labor. Universal Jet also states that no additional facility or other major acquisitions are necessary to commence BBJ operations. We have reviewed Universal Jet s financial projections and we find them reasonable. In addition, since the aircraft owners pay most of the operating costs to Universal Jet, we are not including them in our financial fitness determination. Instead, we base our financial fitness test on Universal Jet s projected indirect expenses ($393,716) plus negative working capital ($2.83 million). 10 Therefore, to meet the Department s financial fitness criteria, Universal Jet would need approximately $3.23 million. 8 Universal Jet s $3.81 million in current liabilities mainly consist of Accounts Payable ($2.3 million) and Taxes Payable ($1.15 million). Of the company s $2.3 million in Accounts Payable, it expects to pay off $1.08 million within the next 12 months. 9 Because projected expenses during the first several months of air transportation services frequently do not include all costs that will be incurred during a normal period of operations, it is our practice to base our threemonth test on an average of one-quarter of the first year s operating cost forecast. 10 See Swift Air, Order 2006-9-10, at 5.

6 In support of its ability to fund its proposed operations, the air carrier provided a letter from an individual, Mr. Michael Fine, 11 stating he will provide a line-of-credit to Universal Jet in the amount of $4.5 million. This letter was accompanied by a Wells Fargo Bank financial statement in Mr. Fine s name for the month of July 2011, confirming the amount on deposit in excess of the line-of-credit. In light of the above, we tentatively conclude that Universal Jet will have access to sufficient financial resources to commence the operations it proposes without posing an undue risk to consumers and their funds. 12 Compliance Disposition The applicant states that, except as noted above, there are no other actions or outstanding judgments against it, its owners, or its key personnel nor have there been any charges of unfair, deceptive or anti-competitive business practices, or of fraud, felony or antitrust violations brought against any of these parties in the past ten years. The applicant also states that there are no pending investigations, enforcement actions, or formal complaints filed by the Department against it, its key personnel, or persons having a substantial interest in it with respect to compliance with the Transportation Code or the Department s regulations. A review of our records and other information available to us has uncovered no information which would reflect negatively on the applicant or any of its key personnel. In addition, according to the FAA, the air carrier has conducted its operations in satisfactory manner and the agency knows of no reason why the air carrier should not be granted the authority it is seeking. Moreover, the applicant notes that neither it nor any of its key personnel have been involved in an accident or incident in the year preceding its application or at any time in the past which remains under investigation by the FAA, the National Transportation Safety Board, or the company itself. In light of these circumstances, we tentatively find that Universal Jet has the proper regard for the laws and regulations governing its services to ensure that its aircraft and personnel conform to applicable safety standards and that acceptable consumer relations practices will be followed. CITIZENSHIP Section 41102 of the Transportation Code requires that certificates to engage in air transportation be held only by citizens of the United States as defined in 49 U.S.C. 40102(a)(15). That section specifies that the president and two-thirds of the board of directors and other managing officers be U.S. citizens, that at least 75 percent of the outstanding voting interest be owned by U.S. citizens, and that the air carrier must be under the actual control of U.S. citizens. 11 Mr. Fine, a U.S. citizen, is a 50 percent owner of Executive Jet Services, Inc., which he co-owns with Mr. Michael McAuley. 12 As is our practice, prior to making any authority awarded to Universal Jet effective, we will require the company to demonstrate that it continues to have access to the financial resources needed to meet our financial test.

7 As noted earlier, Universal Jet was incorporated under the laws of the State of Florida in 1995. Mr. Michael W. McCauley, the applicant s President, holds all outstanding shares of the company s common stock. In addition, Universal Jet has submitted an affidavit attesting that it is a U.S. citizen. Finally, there is no other information before us that would lead us to conclude that Universal Jet is not controlled by U.S. citizens. In view of the foregoing, we tentatively conclude that Universal Jet is a U.S. citizen and that it is fit, willing, and able to provide air transportation services as a U.S. certificated air carrier, subject to conditions. PUBLIC CONVENIENCE AND NECESSITY A finding of consistency with the public convenience and necessity is required for the award of authority for foreign charter air transportation of persons, property, and mail under section 41102. We tentatively find that the foreign charter air transportation proposed by Universal Jet is consistent with the public convenience and necessity. By Order 78-7-106, which instituted the Former Large Irregular Air Service Investigation, the Civil Aeronautics Board found that there was a continuing demand and need for additional charter air carriers. These findings remain valid and apply to the authority sought by Universal Jet. Therefore, if Universal Jet meets the fitness requirements of the Transportation Code, it will receive certificates authorizing it to engage in interstate and foreign charter air transportation of persons, property, and mail under section 41102. 13 REQUEST FOR CONFIDENTIAL TREATMENT On August 15, 2011, Universal Jet filed a motion for confidential treatment under 14 CFR 302.12 ( Rule 12 ) of our rules to withhold from public disclosure an Aircraft Management Agreement between Universal Jet and Delaware Global Operations LLC ( Exhibit F ). In support of its motion, Universal Jet states that the information at issue meets the requirements for exemption from public disclosure under the Freedom of Information Act, 5 U.S.C. Section 552(b)(4). Moreover, Universal Jet states that the material contains proprietary information that would not normally be provided to the public nor would its public disclosure be required to further the public interest or promote competition. Further, Universal Jet notes that Exhibit F includes terms and financial information that could be used by competitors to Universal Jet s commercial disadvantage, and this document is similar to that for which the Department has granted confidential treatment in the past. Rule 12 instructs us to evaluate requests for confidential treatment in accordance with the standards of disclosure found in the Freedom of Information Act (5 U.S.C. Section 552). Information may be withheld from disclosure under 5 U.S.C. 552(b)(4) if it is (1) commercial or financial, (2) obtained from a person outside of government, and (3) privileged or confidential (Gulf and Western Industries, Inc. v. United States, 615 F.2d 527, 529 (D.C. Cir 1979)). 13 Pursuant to 49 U.S.C. 41307, issuance of foreign authority to the applicant is subject to Presidential review.

8 There is no question that the information for which Universal Jet seeks confidential treatment is financial or commercial in nature and that it was obtained from a person outside the government. The remaining question is whether the information is privileged or confidential whether disclosure of the information is likely to have either of the following effects: (1) impair the Government s ability to obtain necessary information; or (2) cause substantial harm to the competitive position of the person from which the information was obtained (National Parks and Conservation Association v. Morton, 498 F.2d 765, 770 (D.C. Cir 1974)). Further, to be privileged or confidential, the information must not be of the type that is usually released to the public (Gulf and Western Industries, Inc. v. United States, 615 F.2d 527, 530 (D.C. Cir 1979)). After careful review of the motion, we have decided to grant confidentiality to the information for which such treatment is sought. Regarding Exhibit F, the Department typically grants confidential treatment to agreements of this type. We find that the release of this information could cause substantial harm to the competitive position of the applicant. Thus, we will grant confidential treatment to Exhibit F. OBJECTIONS We will give interested persons 14 days following the service date of this order to show cause why the tentative findings and conclusions set forth here should not be made final; answers to objections will be due within 7 days thereafter. We expect such persons to direct their objections, if any, to the applications and points at issue and to support such objections with detailed economic analyses. If an oral evidentiary hearing or discovery procedures are requested, the objector should state in detail why such a hearing or discovery is considered necessary, and what material issues of decisional fact the objector would expect to establish through a hearing or discovery that cannot be established in written pleadings. The objector should consider whether discovery procedures alone would be sufficient to resolve material issues of decisional fact. If so, the type of procedure should be specified (See Part 302, Rules 19 and 20); if not, the reasons why not should be explained. We will not entertain general, vague, or unsupported objections. If no substantive objections are filed, we will issue orders that will make final our tentative findings and conclusions with respect to Universal Jet s fitness and certification. EFFECTIVE CERTIFICATE CONDITIONS AND LIMITATIONS If Universal Jet is found fit and issued the certificates it seeks, its authority will not become effective until the air carrier has fulfilled all of the requirements for effectiveness as set forth in the terms and conditions attached to its certificates. Among other things, this includes (1) our receipt of evidence of Universal Jet s authority from the FAA authorizing such operations, (2) evidence of liability insurance coverage that meets the requirements of section 205.5(b) of our rules, (3) a statement of changes it may have undergone since its fitness was examined, and (4) evidence that Universal Jet continues to have adequate financial resources available to it. We also wish to remind Universal Jet of the requirements of 49 U.S.C. 41110(e). Specifically, that section requires that, once an air carrier is found fit initially, it must remain fit in order to hold its authority. To be assured that certificated air carriers continue to be fit after effective

9 authority has been issued to them, we require that they supply information describing any subsequent substantial changes they may undergo in areas affecting fitness. Therefore, if Universal Jet is issued effective certificate authority and subsequently proposes substantial changes in its ownership, management, or operations, it must first comply with the requirements of section 204.5 of our rules. 14 Moreover, as discussed in the FITNESS section of this order, our finding of fitness for Universal Jet is based on the operating plans described in its application, namely, performing passenger charter air transportation with one large aircraft. 15 Were the applicant to propose to expand its operations to include additional large aircraft, our fitness findings, particularly involving the adequacy of Universal Jet s management and financial resources, might no longer apply. Therefore, should Universal Jet desire to operate additional large aircraft, it must first provide the Department with at least 45-days advance notice of such plans and provide updated information establishing it fitness for such expansion. The compliance of the company with this requirement is essential if we are to carry out our responsibilities under section 41110(e). 16 Finally, if Universal Jet is granted effective authority, it would be required to submit a detailed progress report, within 45 days following the end of the first year of certificated flight operations, to the Air Carrier Fitness Division. The submission of a first year progress report is conditioned upon all newly certificated air carriers and was adopted as policy by the Department to aid in monitoring the fitness of new air carriers. The report should include a description of the air carrier s current operations (number and type of aircraft, principle markets served, total number of full-time employees), a summary of how its operations have changed during the year, a discussion of any changes it anticipates from its current operations during its second year, current financial statements, 17 and a listing of current senior management and key technical personnel. The air carrier should also be prepared to meet with staff members of the Fitness Division to discuss its current and future operations. 14 The air carrier may contact our Air Carrier Fitness Division to report proposed substantial changes in its operations, ownership, or management, and to determine what additional information, if any, will be required under section 204.5. In addition, by notice dated July 21, 1998, the Department requested air carriers to provide a 30-day advance notification of any proposed change in ownership, restructuring, or recapitalization. If the air carrier fails to file this updated information or if the information fails to demonstrate that the air carrier will continue to be fit upon implementation of the substantial change, the Department may take such action as is appropriate, including enforcement action or steps to modify, suspend, or revoke the air carrier's certificate authority. 15 This limitation does not apply to the air carrier s small aircraft operations and, as a result, Universal Jet remains free to conduct operations with as many small aircraft as it desires. 16 We also remind Universal Jet about the requirements of section 204.7 of our rules. This section provides, among other things, that (1) the certificate authority granted to a company shall be revoked if the company does not commence actual flying operations under that authority within one year of the date of the Department's determination of its fitness; (2) if the company commences operations for which it was found fit and subsequently ceases such operations, it may not resume commuter operations unless its fitness has been redetermined; and (3) if the company does not resume operations within one year of its cessation, its authority shall be revoked for dormancy. 17 These financial statements should include a balance sheet as of the end of the company s first full year of certificated flight operations and a 12-month income statement ending that same date.

10 ACCORDINGLY, 1. We direct all interested persons to show cause why we should not issue orders making final our tentative findings and conclusions stated above and award certificates to Universal Jet Aviation, Inc., authorizing it to engage in interstate and foreign charter air transportation of persons, property and mail using one large aircraft, subject to the attached specimen Terms, Conditions, and Limitations. 2. We direct any interested persons having objections to the issuance of orders making final any of the proposed findings, conclusions, or the certificate awards set forth here to file such objections with the Department of Transportation Dockets, 1200 New Jersey Avenue, S.E., West Building Ground Floor, Rm. W12-140, Washington, D.C. 20590, in Dockets DOT-OST-2011-0150 and DOT-OST-2011-0151 and serve them upon all persons listed in Attachment A no later than 14 days after the service date of this order; answers to objections shall be filed no later than 7 days thereafter. 3. We grant the motion for confidential treatment filed by Universal Jet Aviation Inc., on August 15, 2011. 4. If timely and properly supported objections are filed, we will accord full consideration to the matters or issues raised by the objections before we take further action. 5. In the event that no objections are filed, we will consider all further procedural steps to be waived and we will enter orders making final our tentative findings and conclusions and will issue Universal Jet Aviation, Inc., certificates that will contain exact copies of the attached specimen Terms, Conditions, and Limitations. 18 6. We will serve a copy of this order on the persons listed in Attachment A. 7. We will publish a notice of this order in the Federal Register. By: SUSAN L. KURLAND Assistant Secretary for Aviation and International Affairs An electronic version of this document is available on the World Wide Web at http://www.regulations.gov 18 Since we have provided for the filing of objections to this order, we will not entertain petitions for reconsideration.

Specimen Terms, Conditions, and Limitations Attachment UNIVERSAL JET AVIATION, INC. is authorized to engage in interstate charter air transportation of persons, property and mail between any point in any State, territory, or possession of the United States or the District of Columbia, and any other point in any of those entities. This authority is subject to the following provisions: (1) The authority to operate under this certificate will not become effective until six (business) days after the Department has received the following documents; provided, however, that the Department may stay the effectiveness of this authority at any time prior to that date: (a) A copy of the holder's Air Carrier Certificate and Operations Specifications authorizing such operations from the Federal Aviation Administration (FAA). (b) A certificate of insurance on OST Form 6410 evidencing liability insurance coverage meeting the requirements of 14 CFR 205.5(b) for all of its aircraft. (c) A statement of any changes the holder has undergone in its ownership, key personnel, operating plans, financial posture, or compliance history, since the date of the Show Cause Order in this case. (d) A revised list of pre-operating expenses already paid and those remaining to be paid, as well as independent verification that the holder has available to it funds sufficient to cover any remaining pre-operating expenses and to provide a working capital reserve equal to the operating costs that would be incurred in three months of operations. (2) Pending receipt of effective authority, the holder may not accept payment of any kind (i.e., cash, check, or credit card), issue tickets for the operations proposed under this certificate, or enter into contracts with charter operators, and any advertisement by the holder must prominently state: "This service is subject to receipt of government operating authority." (3) The holder shall at all times conduct its operations in accordance with the regulations prescribed by the Department of Transportation for the services authorized by this certificate, and with such other reasonable terms, conditions, and limitations as the Department of Transportation may prescribe in the public interest. (4) The holder's authority under this certificate is effective only to the extent that such operations are also authorized by the Federal Aviation Administration (FAA), and comply with

2 all U.S. Government requirements concerning security, including, but not limited to 49 CFR Part 1544. (5) The holder shall at all times remain a "Citizen of the United States" as required by 49 U.S.C. 40102(a)(15). (6) The holder shall maintain in effect liability insurance coverage as required under 14 CFR Part 205. Failure to maintain such insurance coverage will render a certificate ineffective, and this or other failure to comply with the provisions of Subtitle VII of Title 49 of the United States Code or the Department's regulations shall be sufficient grounds to revoke this certificate. (7) The holder is not authorized to engage in air transportation operations between points within the State of Alaska. (8) Should the holder propose any substantial change in its ownership, management, or operations (as defined in 14 CFR 204.2(l)), it must first comply with the requirements of 14 CFR 204.5. (9) In the event that the holder does not commence actual flying operations under this certificate within one year of the date of the Department's determination of its fitness, its authority shall be revoked for dormancy, unless the holder is conducting operations under another type of certificate authority. Further, in the event that the holder commences operations for which it was found "fit, willing, and able" and subsequently ceases all such operations, its authority under all certificates held shall be suspended under the terms of 14 CFR 204.7 and the holder may neither recommence nor advertise such operations unless its fitness to do so has been redetermined by the Department. Moreover, if the holder does not resume operations within one year of its cessation, its authority shall be revoked for dormancy. To assure compliance with all applicable U.S. Government requirements concerning security, the holder shall, before commencing any new service (including charter flights) to or from a foreign airport, contact its Principal Security Inspector (PSI) to advise the PSI of its plans and to find out whether the Transportation Security Administration has determined that security is adequate to allow such airport(s) to be served.

Specimen Terms, Conditions, and Limitations Attachment UNIVERSAL JET AVIATION, INC. is authorized to engage in foreign charter air transportation of persons, property, and mail: Between any place in the United States and any place outside thereof. This authority is subject to the following provisions: (1) The authority to operate under this certificate will not become effective until six (business) days after the Department has received the following documents; provided, however, that the Department may stay the effectiveness of this authority at any time prior to that date: (a) A copy of the holder's Air Carrier Certificate and Operations Specifications authorizing such operations from the Federal Aviation Administration (FAA). (b) A certificate of insurance on OST Form 6410 evidencing liability insurance coverage meeting the requirements of 14 CFR 205.5(b) for all of its aircraft. (c) A statement of any changes the holder has undergone in its ownership, key personnel, operating plans, financial posture, or compliance history, since the date of the Show Cause Order in this case. (d) A revised list of pre-operating expenses already paid and those remaining to be paid, as well as independent verification that the holder has available to it funds sufficient to cover any remaining pre-operating expenses and to provide a working capital reserve equal to the operating costs that would be incurred in three months of operations. (2) Pending receipt of effective authority, the holder may not accept payment of any kind (i.e., cash, check, or credit card), issue tickets for the operations proposed under this certificate, or enter into contracts with charter operators, and any advertisement by the holder must prominently state: "This service is subject to receipt of government operating authority." (3) The holder shall at all times conduct its operations in accordance with the regulations prescribed by the Department of Transportation for the services authorized by this certificate, and with such other reasonable terms, conditions, and limitations as the Department of Transportation may prescribe in the public interest. (4) The holder shall at all times conduct its operations in accordance with all treaties and agreements between the United States and other countries, and the exercise of the privileges granted by this certificate is subject to compliance with such treaties and agreements and with

2 any orders of the Department of Transportation issued under them or for the purpose of requiring compliance with them. (5) The exercise of the authority granted here is subject to the holder's first obtaining from the appropriate foreign governments such operating rights as may be necessary. (6) The holder's authority under this certificate is effective only to the extent that such operations are also authorized by the Federal Aviation Administration (FAA), and comply with all U.S. Government requirements concerning security, including, but not limited to 49 CFR Part 1544. (7) The holder shall at all times remain a "Citizen of the United States" as required by 49 U.S.C. 40102(a)(15). (8) The holder shall maintain in effect liability insurance coverage as required under 14 CFR Part 205. Failure to maintain such insurance coverage will render a certificate ineffective, and this or other failure to comply with the provisions of Subtitle VII of Title 49 of the United States Code or the Department's regulations shall be sufficient grounds to revoke this certificate. (9) Should the holder propose any substantial change in its ownership, management, or operations (as defined in 14 CFR 204.2(l)), it must first comply with the requirements of 14 CFR 204.5. (10) In the event that the holder does not commence actual flying operations under this certificate within one year of the date of the Department's determination of its fitness, its authority shall be revoked for dormancy, unless the holder is conducting operations under another type of certificate authority. Further, in the event that the holder commences operations for which it was found "fit, willing, and able" and subsequently ceases all such operations, its authority under all certificates held shall be suspended under the terms of 14 CFR 204.7 and the holder may neither recommence nor advertise such operations unless its fitness to do so has been redetermined by the Department. Moreover, if the holder does not resume operations within one year of its cessation, its authority shall be revoked for dormancy. To assure compliance with all applicable U.S. Government requirements concerning security, the holder shall, before commencing any new service (including charter flights) to or from a foreign airport, contact its Principal Security Inspector (PSI) to advise the PSI of its plans and to find out whether the Transportation Security Administration has determined that security is adequate to allow such airport(s) to be served.

Attachment A SERVICE LIST FOR UNIVERSAL JET AVIATION, INC. MICHAEL MCCAULEY PRESIDENT UNIVERSAL JET AVIATION, INC 3700 AIRPORT ROAD SUITE 204 BOCA RATON FL 33431 OFFICE OF AIRLINE INFORMATION DOT/RSPA/BTS E-36 1200 NEW JERSEY AVE SE WASHINGTON DC 20590 LORRAINE HALLOWAY GERALD MURHPY CROWELL & MORING LLP 1001 PENNSYLVANIA AVE NW WASHINGTON DC 20004 WILLIAM J WEBER CERTIFICATION SECTION MANAGER FAA AFS-900 45005 AVIATION DRIVE, SUITE 131 DULLES VA 20166 JERRY PROENZA FAA SOUTH FLORIDA FSDO 2895 SW 145 TH AVENUE SUITE 120 MIRAMAR FL 33027 PETER LYNCH AGC-300 ASST CHIEF COUNSEL FOR ENFORCEMENT FEDERAL AVIATION ADMINISTRATION 800 INDEPENDENCE AVE SW WASHINGTON DC 20591