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EXHIBIT 99.1
Disclosure Regarding Confidential Information:
Portions of Appendices D, F, G, H, I, PNW D and PNW F attached to this
Exhibit 99.1 to a Current Report on Form 8-K (consisting of portions of 13
multiple pages) have been omitted from this exhibit filed with the
Securities and Exchange Commission (the "Commission") by SkyWest, Inc. The
omitted portions, which are the subject of an application for confidential
treatment and have been filed separately with the Commission, are
identified in this exhibit by the placement of the following symbol: +.
AMENDMENT AGREEMENT
This AMENDMENT AGREEMENT (this "AMENDMENT"), dated as of
February 6, 1998, is between UNITED AIR LINES, INC. ("United"), and
SKYWEST AIRLINES, INC. ("CONTRACTOR"), hereby further amends and is made
a part of the United Express Agreement, which was effective on October
1, 1997 (the "AGREEMENT"), between these parties, and this Amendment is
effective as of April 23, 1998 (the "AMENDMENT EFFECTIVE DATE") upon
final execution of the Agreement.
1. INTRODUCTION. This Amendment, when fully executed by the parties hereto,
will become part of the Agreement and will evidence the parties' further
agreement with respect to the matters set forth below. All terms used herein,
unless otherwise defined in this Amendment, shall have the same meaning as in
the Agreement. The terms and conditions of the Agreement, to the extent not in
conflict with this Amendment, are hereby incorporated into this Amendment. In
the event of any conflict between any of the provisions of this Amendment and
the Agreement, the provisions of this Amendment shall govern.
2. TERM. The term of this Amendment becomes effective at 12:01 a.m.
Chicago, Illinois time, on the Amendment Effective Date, and shall terminate,
(a) WITH RESPECT TO THE LAX CITY PAIRS, on September 30, 2002;
unless it is terminated at an earlier date pursuant to one or more of the
provisions of the Agreement; provided, however, that this Amendment may be
terminated by United for convenience upon 180 days' prior written notice to
Contractor, which notice shall not be given earlier than September 30, 1999; and
(b) WITH RESPECT TO THE SFO CITY PAIRS AND THE PNW CITY PAIRS, on
May 31, 2008; unless it is terminated at an earlier date pursuant to one or more
of the provisions of the Agreement; PROVIDED, HOWEVER, that this Amendment, in
whole or in part, may be terminated at any time by United for convenience upon
180 days' prior written notice to Contractor.
3. APPENDICES. Existing APPENDICES B, D, F and G are amended and replaced
in their entirety by the attached APPENDICES B, D, F and G. The new appendices
PNW APPENDIX B, D, and F are added to the Agreement.
IN WITNESS WHEREOF, the parties have agreed to and executed this
Amendment by their authorized representatives as of the day and year first
written above on this Amendment.
UNITED AIR LINES, INC. SKYWEST AIRLINES, INC.
By: ___________________________ By: __________________________
Title: ________________________ Title: _______________________
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APPENDIX B
AIRPORT SERVICES
Customer Service/ Customer Service/ Ground Handling Receipt/
Airport Ticket Counter * Gates Ramp Duties ** Dispatch
- ------- ----------------- ----------------- --------------- --------
I. EFFECTIVE OCTOBER 1, 1997
-------------------------
BUR United United United United
LAS United United United United
LAX United Contractor Contractor Contr.
MRY United United United United
PSP United United Contractor Contr.
SBA United United Contractor Contr.
SJC United United United United
II. EFFECTIVE APRIL 23, 1998
------------------------
SNA United United United United
* Also including Small Package service.
** Any unique ground equipment which is needed to service Contractor's
aircraft will be provided by Contractor.
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APPENDIX D
CONTRACT CITY PAIRS
City Pair Frequency *
- --------- -----------
Winter Summer
October 1 thru June 1 thru
May 31 September 30
------------ ------------
I. EFFECTIVE OCTOBER 1, 1997 ("ORIGINAL LAX CITY PAIRS")
-------------------------
LAX - MRY + +
LAX - ONT + +
LAX - PSP + +
LAX - SAN + +
LAX - SJC + +
LAX - SBP + +
LAX - SBA + +
LAX - SMX + +
LAX - YUM + +
LAX - IPL + +
IPL - YUM + +
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City Pair Frequency *
- --------- -----------
Winter Summer
October 1 thru June 1 thru
May 31 September 30
------------ ------------
II. EFFECTIVE APRIL 23, 1998 ("APRIL 23 LAX CITY PAIRS")
------------------------
LAX - BFL + +
LAX - CLD + +
LAX - FAT + +
LAX - IYK + +
LAX - OXR + +
LAX - SNA + +
LAX - VIS + +
* The daily flight frequency reflects the number of roundtrip(s) in a 30
seat EMB120 aircraft.** The flight frequency will be adjusted to reflect
normal reduced weekend and holiday schedules.
** Contractor's regional jet aircraft are not included in these operations.
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APPENDIX F
CONTRACT FEES
City Pair Cost Per Departure * Cost Per Revenue Passenger **
- --------- -------------------- -----------------------------
I. EFFECTIVE OCTOBER 1, 1997
-------------------------
LAX - MRY + +
LAX - ONT + +
LAX - PSP + +
LAX - SAN + +
LAX - SJC + +
LAX - SBP + +
LAX - SBA + +
LAX - SMX + +
LAX - YUM + +
LAX - IPL + +
IPL - YUM + +
* The cost per departure will be paid for each completed flight operation.
Flights operated in excess of the frequency outlined in Appendix D, must
be approved by United.
** Effective JANUARY 1, 1998, the Cost Per Revenue Passenger (except
IPL-YUM) shall be +.
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City Pair Cost Per Departure * Cost Per Revenue Passenger **
- --------- -------------------- -----------------------------
II. EFFECTIVE APRIL 23, 1998
------------------------
LAX - BFL + +
LAX - CLD + +
LAX - FAT + +
LAX - IYK + +
LAX - OXR + +
LAX - SNA + +
LAX - VIS + +
* The cost per departure will be paid for each completed flight operation.
Flights operated in excess of the frequency outlined in Appendix D, must
be approved by United.
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APPENDIX G
CONTRACT CITY PAIRS INCENTIVE PROGRAM
1. INCENTIVE PROGRAM. To compensate Contractor further for its investment
and to ensure that Contractor has a meaningful incentive to provide a high
quality operation, United will pay Contractor QUARTERLY INCENTIVE PAYMENTS
according to the QUARTERLY INCENTIVE FORMULA below using the + and +
corresponding to the ACTUAL PERFORMANCE LEVELS attained during the quarter for
each of the three (3) PERFORMANCE CATEGORIES set forth in the attached
PERFORMANCE INCENTIVE SCHEDULE. Any resulting Quarterly Incentive Payments based
upon City Pair System's + and + are separate from and based upon a separate set
of + and + than those set forth below for any other City Pair System.
2. QUARTERLY INCENTIVE FORMULA.
QUARTERLY INCENTIVE PAYMENT = A + B.
where, A = +
where, B = +
QUARTERLY CONTRACT CITY PAIR COST = C + D.
where, C = +
where, D = +
3. PERFORMANCE INCENTIVE SCHEDULE.
A. METHOD. For each calendar quarter and for Contractor's entire
United Express operations hereunder, determine Contractor's Performance Level
(A, B, C or D) within each of the Performance Categories + in the Performance
Incentive Schedule below. Then, separately for the various City Pair Systems
shown below, identify in the + and + schedule the figures corresponding to the
Performance Levels attained for each of the Performance Categories. Then,
separately for each City Pair System, add the three percentage figures together
yielding the +, and add the three dollar amounts together yielding the +. Apply
the resulting factors and rates in the Quarterly Incentive Formula to compute
the Quarterly Incentive Payment applicable to each City Pair System.
Note: "Departures" and "revenue passengers" are measured by the lift records
processed by United's Revenue Accounting Department.
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B. SCHEDULE.
PERFORMANCE CATEGORIES:
+
Jan-Mar Apr-Jun Jul-Sep Oct-Dec
------- ------- ------- -------
Level A + + + +
Level B + + + +
Level C + + + +
Level D + + + +
+
+
Jan-Mar Apr-Jun Jul-Sep Oct-Dec
------- ------- ------- -------
Level A + + + +
Level B + + + +
Level C + + + +
Level D + + + +
+
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+
Jan-May and Sep-Nov Jun-Aug, Dec
------------------- ------------
Level A + +
Level B + +
Level C + +
Level D + +
+
ORIGINAL LAX CITY PAIR SYSTEM
+ + +
---------- ------- -------
Level A + + +
Level B + + +
Level C + + +
Level D + + +
APRIL 23 LAX CITY PAIR SYSTEM
+ + +
---------- ------- -------
Level A + + +
Level B + + +
Level C + + +
Level D + + +
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SFO CITY PAIR SYSTEM
+ + +
---------- ------- -------
Level A + + +
Level B + + +
Level C + + +
Level D + + +
PNW CITY PAIR SYSTEM
+ + +
---------- ------- -------
Level A + + +
Level B + + +
Level C + + +
Level D + + +
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PNW APPENDIX B
AIRPORT SERVICES
Customer Service/ Customer Service/ Ground Handling/ Receipt/
Airport Ticket Counter* Gates* Ramp Duties** Dispatch
- ------- ----------------- ----------------- ---------------- --------
SEA United Contractor Contractor Contractor
PDX United Contractor Contractor Contractor
EUG United United United United
MFR United United United United
* Also including Small Package service.
** Any unique ground equipment which is needed to service Contractor's
aircraft will be provided by Contractor.
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PNW APPENDIX D
CONTRACT CITY PAIRS
City Pair Frequency*
--------- ----------
BLI-SEA +
EUG-SEA +
PDX-SEA +
PSC-SEA +
SEA-YKM +
EUG-PDX +
MFR-PDX +
PDX-PSC +
PDX-RDD +
PDX-RDM +
* The daily flight frequency reflects the number of roundtrip(s) in a 30
seat EMB120 aircraft.** The flight frequency will be adjusted to reflect
normal reduced weekend and holiday schedules.
** Contractor's regional jet aircraft are not included in these operations.
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PNW APPENDIX F
CONTRACT FEES
City Pair Cost Per Departure * Cost Per Revenue Passenger
--------- -------------------- --------------------------
BLI-SEA + +
EUG-SEA + +
PDX-SEA + +
PSC-SEA + +
SEA-YKM + +
EUG-PDX + +
MFR-PDX + +
PDX-PSC + +
PDX-RDD + +
PDX-RDM + +
* The cost per departure will be paid for each completed flight operation.
Flights operated in excess of the frequency outlined in PNW Appendix D,
must be approved by United.
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