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Sunrise Airlines, Inc.

A waiver of the forty-five (45) day notice requirement of 14 CFR 204.7 is warranted and necessary for three (3) reasons: (i) the rural community that Sunrise intends to serve is currently without scheduled air service, which is essential to meet many of the community's basic needs; (ii) the closing of the sale of the stock of Sunrise provided for by the Plan, and the subsequent payment of the Proceeds to creditors, is dependent upon Sunrise receiving DOT and FAA approval to resume FAR Part 121 commuter air carrier operations on or before February 16, 2001; and (iii) the majority of the information being submitted by Sunrise pursuant to §§ 204.3 and 204.4 is the same information, which supported the DOT's previous grant of economic authority to Sunrise.

Counsel:  Sunrise, Clifford Langness, 800.245.8668

Sunrise Airlines, Inc.

By:  Delores King

Sunrise Airlines, Inc.

Counsel:  Quarles Brady, Streich Lang, 602.229.5569

Counsel:  Quarles Brady, Streich Lang, 602.229.5569

Sunrise Airlines, Inc.

By:  Delores King

Sunrise Airlines, Inc.

Counsel:  Pillsbury Winthrop, John Gillick, 202.775.9800

Counsel:  Pillsbury Winthrop, John Gillick, 202.775.9800

Sunrise Airlines, Inc.

The Sarasota Bradenton International Airport (SRQ) has lost three major carriers over the last twelve months. Northwest Airlines, Trans World Airlines and American Eagle have all ceased service at our airport. Passenger traffic has declined the last three years, and our passenger traffic is down 13.8% for the first three months of 2001. The loss of American Eagle will further erode the services available from SRQ. The Sarasota Bradenton International Airport has seen the amount of passengers utilizing our facility decline from a high of over 2 million in 1990, to less than 1.5 million in theyear2000 des w an increase in population of over 100,000 people.

In its most recent Supplement to its application, Sunrise has indicated that it plans to initiate four roundtrips per day in the Sarasota-Tallahassee market, four roundtrips per day between Sarasota and Jacksonville via Orlando, four roundtrips per day between Sarasota and Marathon via Ft. Myers and four roundtrips per day between Sarasota and Marathon via Miami as soon as the Department finds Sunrise fit to perform the service. The Sarasota Bradenton Interriational. Airport strongly supports Sunrise's application and urges the Department to complete its fitness review as soon as possible so that Sunrise can begin this service. Expedition is particularly important because American Eagle has stated that it will terminate its service in the Sarasota-Miami market on April 20, 2001. American Eagle carried over 80,000 passengers in this city pair in calendar year 2000.

By:  Sarasota, Frederick Piccolo, 941.359.5200

Sunrise Airlines, Inc.

Sunrise Airlines, Inc. hereby supplements its above-referenced application with the following additional information responding to the matters discussed in the Department's February 15, 2001 letter:

Page 1 of Exhibit E to Sunrise's Third Supplement has been amended to reflect three rather than four nonstop flights in the Naples-Miami market. Pages 2 and 3 of Exhibit E to the Third Supplement have been revised to reflect a change in the estimate of revenue for the months of December-April in the first year forecast. In addition, Sunrise is providing additional revenue and expense detail concerning its first year forecast on new pages 4-5 of Exhibit E. 2. A pro-forma balance sheet for Sunrise at the end of the first year of operations is attached as a new Exhibit 1.

Sunrise has determined to shift the focus of its business plan to several Florida markets. Using Sarasota as its base of operations, Sunrise plans to initiate four roundtrips per day in the Sarasota-Tallahassee market, four roundtrips per day between Sarasota and Jacksonville via Orlando, four roundtrips per day between Sarasota and Marathon via Ft. Myers, four roundtrips per day between Sarasota and Marathon via Miami, and three roundtrips per day between Naples and Miami -- markets that are today either inadequately served or have no service at all.

The focus of Sunrise's marketing efforts will be on two target markets: business passengers traveling within the state that are looking for reliable commuter airline service (particularly for those traveling to and from Tallahassee), and vacationers that are traveling to destinations served by Sunrise connecting to other flights. Among the marketing initiatives that Sun rise intends to introduce are vacation packages, coupon books, family discounts, student programs and senior programs. After the initiation of service in these markets, Sunrise will look to other, similar commuter markets within Florida to expand its pattern of service. As may be seen from the attached Pro-forma Statement of Earnings, Sunrise anticipates achieving an operating profit of approximately $5,680,241 in the first year of operations, and net income of $4,187,364. Sunrise projects that its total expenses in the first year of operation will be $13,350,700, and that an "average" quarter of first year expenses will be $3,337,675.

Counsel:  Pillsbury Winthrop, John Gillick, 202.775.9800

Counsel:  Pillsbury Winthrop, John Gillick, 202.775.9800

Sunrise Airlines, Inc.

Sunrise has indicated that as soon as the Department determines that Sunrise is fit, it plans to initiate four roundtrip per day service in the Naples-Miami market with JetStream 31 aircraft. The City of Naples Airport Authority strongly supports this application and urges that the Department complete the Sunrise fitness review as soon as possible. American Eagle has announced that it intends to terminate services in the Naples-Miami market on April 20, 2001.

By way of background, the Naples Municipal Airport serves as a gateway to the City of Naples and Collier County for thousands of visitors per year. The airport is ideally located within minutes of downtown Naples with convenient access to major roads and Interstate 75. At the present time, the Naples Municipal Airport is served by three airlines - American Eagle, Cape Air and US Airways. American Eagle provides service to Miami with ATR aircraft, Cape Air provides service to Key West with Cessna aircraft and US Airways provides service to Orlando and Tampa with Beech aircraft. Recently, American Eagle announced that it would be terminating its Naples-Miami service on April 20, 200 1. This Naples-Miami service is important for the thousands of passengers traveling to and from Naples every year via Miami and Sunrise's proposed initiation of service will meet a critically important service need for the City of Naples and Collier County.

The Miami-Naples service was initiated by Provincetown-Boston Airlines as a way to shorten the more than two-hour trip through the Everglades to Miami to only 30 minutes. Since the institution of that service, the Naples-Miami market has grown significantly, with American Eagle carrying an estimated 80,000 passengers during 2000. With American Eagle's announced withdrawal from the Naples-Miami market, this important link to Miami, as well as the points beyond Miami served by U.S. and foreign airlines operating at Miami, would be lost. Sunrise's willingness to provide four roundtrips per day in this market is an important lifeline for Naples, and we urge that the Department complete its fitness review of Sunrise as soon as possible so that Sunrise will be able to fill this critically important void.

By:  City of Naples Airport Authority

Sunrise Airlines, Inc.

As the Department is aware, the original operating plan for Sunrise was to resume regularly-scheduled commuter air service operations in its historic service area during the Chapter I I reorganization case. In particular, Sunrise re-bid the Essential Air Service (EAS) routes previously operated by Sunrise, and intended to institute service in these markets as approved and awarded by the Department.

On March 21, 2001, the Department issued Order 2001-3-20, selecting Great Lakes Aviation, rather than Sunrise, to provide replacement essential air service at Page, Vernal and Moab for a two-year period. At that time, the Department indicated that the selection decision for Ely would be dealt with in a separate order. See Order 2001-1-20 (resoliciting proposals for Ely). As a consequence of the effect of the Department's action on the Sunrise business plan, Sunrise decided to move to the third stage of its business plan and begin operations in Florida.

Subsequently, Sunrise was encouraged by the Department's EAS office to resubmit its application to provide service in the Ely, Nevada market. In response to that request, Sunrise has developed a revised bid for this service, but did not formally submit the bid to the Department. The Department has recently distributed the three bids formerly submitted for this service to the communities for their comment, and, thus, Sunrise is not being considered for this service at this time.

Counsel:  Pillsbury Winthrop, John Gillick, 202.775.9800

Counsel:  Pillsbury Winthrop, John Gillick, 202.775.9800

Sunrise Airlines, Inc.

1. Exhibit A sets forth detailed backup revenue and cost information that was used to develop the Projected Statement of Operations for the first year set forth in Exhibit G to the Fifth Supplement.

2. Exhibit B provides detailed information concerning the financing plans for Sunrise, including a list of all funds that have been raised as well as the plan for raising additional capital to support Sunrise's operations.

3. Exhibit C is an Affidavit of Financial Resources executed by Wallace J. Hilliard, the Chairman of the Board of Sunrise and Florida Air Holdings, Inc.

Counsel:  Pillsbury Winthrop, John Gillick, 202.775.9800

Counsel:  Pillsbury Winthrop, John Gillick, 202.775.9800

Sunrise Airlines, Inc.

1. Exhibit A sets forth information concerning Florida Air Holdings, Inc. and the Dekkers Aviation Group, Inc.

2. Exhibit B sets forth information concerning the balance sheets of Florida Air Holdings, Inc. and Sunrise and the start-up expenses of Sunrise.

3. Exhibit C sets forth information concerning the financing of Sunrise's operations.

4. Exhibit D sets forth information concerning the management and operations of Sunrise.

5. Exhibit E sets forth information concerning the Sunrise traffic, revenue and ex-pense forecasts.

Counsel:  Pillsbury Winthrop, John Gillick, 202.775.9800

Counsel:  Pillsbury Winthrop, John Gillick, 202.775.9800

Sunrise Airlines, Inc.

As the work on the six Sunrise aircraft is completed in Page, Arizona, the aircraft are being flown to Venice, Florida, where they will remain prior to the initiation of operations by Sunrise. Once these aircraft arrive in Florida, scheduled maintenance will be accomplished at Sunrise's maintenance facilities in Florida. The four mechanics who are presently located in Page are being transferred to Florida as the aircraft are moved to Florida and the Director of Maintenance, Larry Martin, will relocate to Las Vegas, Nevada, where, as discussed previously, Sunrise's Air Carrier Certificate has been held for several years. Mr. Martin will travel to Florida on a regular basis to review Sunrise's maintenance activities.

Counsel:  Pillsbury Winthrop, John Gillick, 202.775.9800

Sunrise Airlines, Inc.

Counsel:  Pillsbury Winthrop, John Gillick, 202.775.9800

Counsel:  Pillsbury Winthrop, John Gillick, 202.775.9800

Sunrise Airlines, Inc.

Sunrise Airlines, Inc. ("Sunrise"), a commuter air carrier that has applied for a determination that it is fit to resume commuter air service with Jetstream J-31 aircraft between several cities in the State of Florida, has requested in the above-referenced docket that the Department register the name "Florida Air" as a trade name for Sunrise. A complete copy of the request may be found in Exhibit E to the Ninth Supplement in the above-referenced docket.

Counsel:  Pillsbury Winthrop, John Gillick, 202.775.9800

Sunrise Airlines, Inc.

Air Florida is doing business in State of Florida since 1988 as FAA approved Air Carrier. It will have considerable effect on our business if Sunrise Airlines is permitted to use `Florida Air' Business Name to operate within State of Florida. Air Florida requests the Department to consider our concerns.

By:  Air Florida, Saulat Khan

Sunrise Airlines, Inc.

Exhibit E of the Ninth Supplement is revised to reflect Sunrise's amended request to conduct operations as "FLAIR Airlines" in addition to Sunrise Airlines, Inc.

Counsel:  Pillsbury Winthrop, John Gillick, 202.775.9800

Sunrise Airlines, Inc., a commuter air carrier that has applied for a determination that it is fit to resume commuter air service with Jetstream J-31 aircraft between several cities in the State of Florida, has requested in the above-referenced docket that the Department register the name "FLAIR Airlines" as a trade name for Sunrise.

Counsel:  Pillsbury Winthrop, John Gillick, 202.775.9800

Sunrise Airlines, Inc.

Exhibit A sets forth the response of Sunrise Airlines, Inc. to the Department's questions of December 7, 2001.

Counsel:  Pillsbury Winthrop, John Gillick, 202.775.9800

Counsel:  Pillsbury Winthrop, John Gillick, 202.775.9800

Sunrise Airlines, Inc.

As discussed in Exhibit A, Sunrise has determined to shift the focus of its business plan to several Florida markets. Using Sarasota as its base of operations. Sunrise plans to initiate four roundtrips per day in the Sarasota-Tallahassee market, four roundtrips per day between Sarasota and Jacksonville via Orlando, four roundtrips per day between Sarasota and Marathon via Ft. Myers, four roundtrips per day between Sarasota and Marathon via Miami, and four roundtrips per day between Naples and Miami -- markets that are today either inadequately served or have no service at all.

The focus of Sunrise's marketing efforts will be on two target markets: business passengers traveling within the state that are looking for reliable commuter airline service (particularly for those traveling to and from Tallahassee), and vacationers that are traveling to destinations served by Sunrise connecting to other flights. Among the marketing initiatives that Sunrise intends to introduce are vacation packages, coupon books, family discounts, student programs and senior programs. After the initiation of service in these markets, Sunrise will look to other, similar commuter markets within Florida to expand its pattern of service.

As may be seen from the attached Pro-forma Statement of Earnings, Sunrise anticipates achieving an operating profit of approximately $5,680,241 in the first year of operations, and net income of $4,187,364. Sunrise projects that its total expenses in the first year of operation will be $13,350,700, and that an "average" quarter of first year expenses will be $3,337,675.

Counsel:  Pillsbury Winthrop, John Gillick, 202.775.9800

Sunrise Airlines, Inc.

Air Florida is doing business in State of Florida since 1988 as FAA approved Air Carrier. Copy of Operation Specification issued by Fort Lauderdale FSDO to do business as Air Florida is attached. Air Florida has no objection to Sunrise Airline using the trade name "FLARE Airlines" in the same market as long as it is not used as an abbreviation for getting DOT approval and marketed as Florida Air (such as answering phone using Florida Air). This will have considerable effect on our business within State of Florida.

By:  Air Florida, Melvin Gordon

Counsel:  Pillsbury Winthrop, John Gillick, 202.775.9800

Sunrise Airlines, Inc.

Counsel:  Pillsbury Winthrop, John Gillick, 202.775.9800, jgillick@pillsburywinthrop.com 

Counsel:  Pillsbury Winthrop, John Gillick, 202.775.9800, jgillick@pillsburywinthrop.com

Sunrise Airlines, Inc.

Order 2002-2-5 tentatively finds Sunrise Airlines, Inc. d/b/a Flair Airlines (Sunrise) fit, willing, and able to resume scheduled passenger air transportation operations as a commuter air carrier, subject to conditions.  When it ceased operations in November 2000, Sunrise was the essential air service provider at Page, Arizona, Ely, Nevada, and Vernal and Moab, Utah. It performed these services with leased 19-seat Jetstream-31 aircraft. '3 If authorized to resume operations, the carrier will not be reinstituting its previous services. Rather, as noted earlier, it intends to conduct scheduled passenger flights between its main base of operations in Sarasota to various other points in Florida. The company plans to begin with two daily round trips between Sarasota and Miami. When at full service, the carrier anticipates conducting as many as five daily round trips in this market, with additional flights in other markets. 14 Mr. Hilliard has purchased six 19-seat Jetstream-31 aircraft for the carrier's initial services.

Notwithstanding the above, we have been troubled by the manner in which the carrier prosecuted its application, particularly in its initial submissions filed with the Department. For instance, we understood early on that Dekkers Aviation Group, a company owned by a non-U.S. citizen, Rudi Dekkers, would be its aircraft lessor, but would have no other role with 

Sunrise. We soon learned, however, that Mr. Dekkers, a partner with Mr. Hilliard in other businesses, was, in fact, at that time a principal player in Sunrise's proposed reinstitution of service and he desired to continue playing a key role with the carrier once it had resumed its commuter flights. This would have included a substantial ownership interest and senior management role with the carrier. Since Mr. Dekkers is not a U.S. citizen, his involvement with the carrier caused concerns as to whether Sunrise would meet the requirement in the Statute that U.S. air carriers be substantially owned and controlled by U.S. citizens.

By:  Read Van D Water

Sunrise Airlines, Inc.

Exhibit A responds to the questions raised by the Department with respect to Plane I Leasing, Inc. and Ambassador Aviation, Inc. Exhibit B sets forth information concerning the acquisition of Discover Air, Inc.

Counsel:  Pillsbury Winthrop, John Gillick, 202.775.9800

Sunrise Airlines, Inc. d/b/a Flair Airlines

By Order 2002-2-5, issued February 8, 2002, we tentatively found Sunrise fit to resume scheduled passenger operations as a commuter, subject to conditions. In that order, we specifically noted concerns we had about the carrier’s compliance posture. As a result, we tentatively decided to impose a one-year limitation on the carrier’s commuter authority. Shortly after issuance of our show cause order, we received information unknown to us earlier that indicated that, in May 2001, the Federal Aviation Administration (FAA) had issued a Notice of Proposed Civil Penalty (NPCP) to Plane-1 Leasing Co. (Plane-1) alleging that Plane-1 violated the Federal Aviation Regulations by operating as an air carrier without holding the required FAA operating authority to do so. These allegations, if true, are serious. Plane-1 is owned by Mr. Wallace Hilliard, who, at the time the show cause order was issued, was also Sunrise’s Chairman and principal shareholder and the moving force behind Sunrise’s plans to resume operations. Thus, this pending enforcement action involving another of Mr. Hilliard’s companies was relevant to our assessment of Sunrise’s fitness. On February 13, we orally requested that Sunrise provide us an explanation about the Plane-1 enforcement case, including its status, and Plane-1’s attempts to resolve the matter.

On May 30, Sunrise filed Supplement 13 to its application in Docket OST-2001-8695. Sunrise advises us that the issues to be resolved in the Plane-1 enforcement proceeding include the extent to which flights identified by the FAA in the NPCP (1) were actually operated under the Part 135 authority of another company, and (2) were actually properly operated under Part 91 of the Federal Aviation Regulations. The company states that Plane-1’s discussions with the FAA on this proposed action are currently "ongoing."

Supplement 13 also indicates that, since the issuance of Order 2002-2-5, Sunrise’s parent, Florida Air Holdings, Inc. (FAH), purchased another company, Discover Air, Inc. This purchase resulted in significant changes in the ownership and management of FAH and Sunrise, including the resignation of the former Chief Executive Officer of FAH and Sunrise, Eugene Gillespie. The supplement also indicated that Sunrise would be providing us with an updated accounting of pre-operating expenses and other information relative to Sunrise’s fitness. We have not yet received this outstanding material, nor do we currently have a date by which we might expect to do so.

By:  Read Van de Water

Sunrise Airlines, Inc.

By Order 2002-7-18 (July 10, 2002), the Department vacated Order 2002-2-5 which had tentatively found Sunrise Airlines, Inc. d/b/a FLAIR (Sunrise) fit, willing, and able to resume operations as a commuter air carrier. In that order, the Department informed Sunrise that it should file any remaining outstanding materials needed to complete its application by August 9, 2002. Sunrise hereby submits that additional information, and urges that the Department de­termine that Sunrise is fit, willing and able to resume operations as a commuter air carrier.

Counsel:  Pillsbury Winthrop, John Gillick, 202.775.9800

Counsel:  Pillsbury Winthrop, John Gillick, 202.775.9800

Sunrise Airlines, Inc.

On August 9, you submitted Supplement 14 to Sunrise Airlines' application to resume commuter air carrier operations filed in Docket OST-01-8695. Accompanying Supplement 14 was a motion under section 302.12 requesting confidential treatment of some of the material contained in the supplement. The purpose of this letter is to rule on that motion. We will also take this opportunity to advise you of certain additional information needed in connection with the company's pending application.

By:  Air Carrier Fitness, Patricia Thomas

Sunrise Airlines, Inc.

Counsel: Pillsbury Winthrop, John Gillick,  202 775-9800

Counsel: Pillsbury Winthrop, John Gillick,  202 775-9800

By letter dated August 30, 2002, the Department has requested additional and/or clarifying information with respect to the materials provided by Sunrise Airlines, Inc. d/b/a FLAIR ("Sunrise") in its Fourteenth Supplement on August 9, 2002. Sunrise hereby responds to that request, and urges that the Department determine that Sunrise is fit, willing and able to re­sume operations as a commuter air carrier.

Counsel: Pillsbury Winthrop, John Gillick,  202 775-9800

Sunrise Airlines, Inc.  d/b/a Flair Airlines

Sunrise Airlines, Inc. hereby moves to withdraw its notice of intent to resume scheduled passenger services without prejudice to the refiling of a new application for commuter air carrier authority at a future date.

Counsel: Pillsbury Winthrop, John E. Gillick, 202-775-9800

Sunrise Airlines, Inc. d/b/a Flair Airlines

By Order 2002-2-5, issued February 8, 2002, we tentatively found Sunrise fit to resume commuter services on a limited basis. Shortly thereafter, the Department received new information that had compliance-related implications for the company’s fitness. At that time, we requested further information from Sunrise. Several months later, Sunrise responded and, at the same time, advised us that it had undergone changes in other fitness-related areas since the issuance of Order 2002-2-5. Sunrise advised us that it would file updated information relative to these changes in the above docket. When such information was not received, on July 10, 2002, we issued Order 2002-7-18 vacating our earlier tentative fitness finding. Although Sunrise subsequently filed updated fitness information, in December 2002, we were informally advised that the carrier had again undergone material changes in areas affecting its fitness. On February 14, 2003, Sunrise filed a motion requesting that its application be withdrawn.

We will grant the carrier’s request and dismiss the notice to resume operations filed in Docket OST-2001­8695. At the same time, we will also revoke Sunrise’s dormant commuter air carrier authority.

By: Randall Bennett

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