RJET filing — read by section

Item 8. Financial Statements and Supplementary Data

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA 
 The information set forth below should be read together with the “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” appearing elsewhere herein. 
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 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM 
 To the shareholders and the Board of Directors of Republic Airways Holdings Inc. 
 Opinion on the Financial Statements 
 We have audited the accompanying consolidated balance sheets of Republic Airways Holdings Inc. and subsidiaries (the “ Company ” ) as of December 31, 2025 and 2024, the related consolidated statements of operations, mezzanine equity and shareholders’ equity, and cash flows, for each of the three years in the period ended December 31, 2025, and the related notes (collectively referred to as the “ financial statements ” ). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2025 and 2024, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2025, in conformity with accounting principles generally accepted in the United States of America. 
 Basis for Opinion 
 These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. 
 We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. 
 Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion. 
 Other Matter 
 As discussed in Note 5, Revenues , and Note 16, Related Party Transactions, to the financial statements, substantially all revenues are derived from capacity purchase agreements with American Airlines, Inc., Delta Air Lines, Inc. and United Airlines, Inc. (the “Partner Airlines”). Further, each of the Partner Airlines are related parties through their ownership of the Company’s common stock. Our opinion is not modified with respect to this matter. 
 Critical Audit Matter 
 The critical audit matter communicated below is a matter arising from the current-period audit of the financial statements that was communicated or required to be communicated to the audit committee and that (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates. 
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 Merger with Mesa Air Group, Inc.—Refer to Notes 1 and 3 to the financial statements 
 Critical Audit Matter Description 
 On November 25, 2025, the Company completed a merger with Mesa Air Group, Inc. The merger was accounted for as a reverse acquisition, with the Company as the accounting acquirer of Mesa Air Group, Inc. 
 We identified the evaluation of the accounting for the merger with Mesa Air Group, Inc. as a critical audit matter due to (i) the level of judgment required by management related to the determination of the accounting acquirer and the assessment of the transaction as a reverse acquisition and (ii) the degree of auditor judgment and audit effort in evaluating the Company’s determination of the accounting acquirer, assessment of the transaction as a reverse acquisition and the application of a reverse acquisition for financial reporting purposes. 
 How the Critical Audit Matter Was Addressed in the Audit 
 Our audit procedures related to the reverse acquisition included the following, among others: 
 • We evaluated the Company’s determination of the (i) accounting acquirer and (ii) accounting model as a reverse acquisition. 
 • We inspected minutes of Board of Directors’ meetings, executed merger transaction agreements, and other information to assess the nature and structure of the merger in evaluating management’s conclusions. 
 • We evaluated the consideration transferred by recalculating shares issued using the exchange ratio in the merger agreement. 
 • We tested the retrospective application of the reverse acquisition to all outstanding common shares and restricted stock units. 
 
 
 /s/ Deloitte & Touche LLP 
 Indianapolis, Indiana 
 March 18, 2026 
 We have served as the Company’s auditor since 1998. 
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 REPUBLIC AIRWAYS HOLDINGS INC. AND SUBSIDIARIES 
 CONSOLIDATED BALANCE SHEETS 
 AS OF DECEMBER 31, 2025 and 2024 
 (In millions, except share and per share amounts) 
 
 2025 2024 
 ASSETS 
 
 CURRENT ASSETS: 
 
 Cash and cash equivalents 
 $ 134.3 $ 110.5 
 Marketable securities 
 162.2 191.5 
 Restricted cash 
 23.4 21.4 
 Receivables, net of provisions for credit losses of $ 2.5 and $ 1.7 , respectively 
 21.0 9.8 
 Receivables—related parties 
 69.2 31.1 
 Inventories 
 88.5 63.0 
 Other current assets 
 26.2 15.0 
 Other current assets—related parties 
 15.9 11.0 
 Total current assets 
 540.7 453.3 
 
 Property and equipment, net 
 2,410.0 2,109.5 
 Operating lease right-of-use assets 
 131.7 122.9 
 Goodwill 
 122.5 2.1 
 Other non-current assets 
 40.0 45.0 
 Other non-current assets—related parties 
 31.7 35.0 
 TOTAL ASSETS 
 $ 3,276.6 $ 2,767.8 
 
 LIABILITIES, MEZZANINE EQUITY, AND SHAREHOLDERS’ EQUITY 
 
 CURRENT LIABILITIES: 
 
 Current portion of long-term debt and finance leases 
 $ 202.0 $ 259.6 
 Current portion of operating lease liabilities 
 16.5 13.5 
 Accounts payable 
 96.2 37.2 
 Accrued and other liabilities 
 219.8 168.9 
 Accounts payable and accrued and other liabilities—related parties 
 39.8 9.9 
 Total current liabilities 
 574.3 489.1 
 
 Long-term debt and finance leases – less current portion 
 882.9 752.2 
 Operating lease liabilities – less current portion 
 123.9 117.6 
 Other non-current liabilities 
 42.9 44.8 
 Other non-current liabilities—related parties 
 103.2 41.8 
 Deferred income taxes 
 220.9 206.0 
 Total liabilities 
 1,948.1 1,651.5 
 
 COMMITMENTS AND CONTINGENCIES (Notes 12 and 13) 
 
 MEZZANINE EQUITY (1) (Note 14): 
 
 Restricted stock units (“RSUs”), zero and 2,892,094 authorized; zero and 102,901 shares issued and outstanding, respectively 
 — 5.8 
 SHAREHOLDERS’ EQUITY (1) : 
 
 Common stock, $ 0.001 par value, 5,000,000,000 shares authorized; 45,713,286 and 38,993,300 shares issued and outstanding, respectively 
 — — 
 Additional paid-in capital 
 620.0 478.0 
 Accumulated earnings 
 708.5 632.5 
 Total shareholders’ equity 
 1,328.5 1,110.5 
 TOTAL LIABILITIES, MEZZANINE EQUITY, AND SHAREHOLDERS’ EQUITY 
 $ 3,276.6 $ 2,767.8 

 (1) Mezzanine equity and shareholders’ equity have been retrospectively adjusted to apply the Exchange and Reverse Stock Split as discussed in Note 3, Merger with Mesa Air Group, Inc. 
 See accompanying notes to the consolidated financial statements. 
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 REPUBLIC AIRWAYS HOLDINGS INC. AND SUBSIDIARIES 
 CONSOLIDATED STATEMENTS OF OPERATIONS 
 FOR THE YEARS ENDED DECEMBER 31, 2025, 2024, and 2023 
 (In millions, except per share amounts) 
 
 
 2025 2024 2023 
 REVENUES (1) 
 $ 1,676.5 $ 1,474.0 $ 1,429.1 
 OPERATING EXPENSES: 
 
 Wages and benefits 
 762.6 677.2 654.8 
 Aircraft and engine rent 
 0.7 3.6 6.1 
 Maintenance and repair 
 280.6 268.0 254.1 
 Maintenance and repair—related parties 
 40.3 43.2 31.2 
 Depreciation and amortization 
 126.3 117.0 159.4 
 Executive separation and Merger-related items (Note 4) 47.1 3.2 0.3 
 Other 249.3 225.1 197.7 
 Other—related parties 
 1.3 ( 0.3 ) ( 9.8 ) 
 Total operating expenses 
 1,508.2 1,337.0 1,293.8 
 
 OPERATING INCOME 
 168.3 137.0 135.3 
 
 OTHER INCOME (EXPENSE): 
 
 Investment income and other, net 
 5.7 7.6 1.8 
 Interest expense 
 ( 60.6 ) ( 57.7 ) ( 49.1 ) 
 Total other expense, net 
 ( 54.9 ) ( 50.1 ) ( 47.3 ) 
 
 INCOME BEFORE INCOME TAXES 
 113.4 86.9 88.0 
 INCOME TAX EXPENSE 
 37.2 22.3 33.2 
 NET INCOME 
 $ 76.2 $ 64.6 $ 54.8 
 
 NET INCOME PER COMMON SHARE—BASIC 
 $ 1.90 $ 1.65 $ 1.40 
 NET INCOME PER COMMON SHARE—DILUTED 
 1.87 1.62 1.38 
 WEIGHTED AVERAGE COMMON SHARES OUTSTANDING—BASIC 
 40.0 39.1 39.1 
 WEIGHTED AVERAGE COMMON SHARES OUTSTANDING—DILUTED 
 40.7 39.8 39.7 

 (1) Substantially all of the Company’s revenues are derived from related parties during the years ended December 31, 2025, 2024, and 2023. Refer to Note 16 , Related Party Transactions and Note 5, Revenue Recognition . 
 See accompanying notes to the consolidated financial statements. 
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 REPUBLIC AIRWAYS HOLDINGS INC. AND SUBSIDIARIES 
 CONSOLIDATED STATEMENTS OF MEZZANINE EQUITY AND SHAREHOLDERS’ EQUITY 
 FOR THE YEARS ENDED DECEMBER 31, 2025, 2024, and 2023 
 (In millions, except share and per share amounts) 
 
 
 
 Mezzanine Equity (1) 
 
 
 Common Stock (1) 
 
 
 
 
 
 
 
 
 
 Shares 
 
 Amount 
 
 
 Shares 
 
 Amount 
 
 Additional Paid-In Capital 
 
 Accumulated Earnings 
 
 Total Shareholders’ Equity 
 
 Balance at January 1, 2023 
 
 98,965 
 
 
 $ 
 3.5 
 
 
 
 38,993,300 
 
 
 $ 
 — 
 
 
 $ 
 478.0 
 
 
 $ 
 513.1 
 
 
 $ 
 991.1 
 
 
 Net income 
 
 — 
 
 
 — 
 
 
 
 — 
 
 
 — 
 
 
 — 
 
 
 54.8 
 
 
 54.8 
 
 Share based compensation 
 
 — 
 
 
 1.2 
 
 
 
 — 
 
 
 — 
 
 
 — 
 
 
 — 
 
 
 — 
 
 
 Repurchase and retirement of common stock 
 
 ( 14,622 ) 
 
 
 ( 0.2 ) 
 
 
 
 — 
 
 
 — 
 
 
 — 
 
 
 — 
 
 
 — 
 
 
 Issuance of restricted stock units 
 
 18,558 
 
 
 0.3 
 
 
 
 — 
 
 
 — 
 
 
 — 
 
 
 — 
 
 
 — 
 
 
 Balance at December 31, 2023 
 
 102,901 
 
 
 $ 
 4.8 
 
 
 
 38,993,300 
 
 
 $ 
 — 
 
 
 $ 
 478.0 
 
 
 $ 
 567.9 
 
 
 $ 
 1,045.9 
 
 
 Net income 
 
 — 
 
 
 — 
 
 
 
 — 
 
 
 — 
 
 
 — 
 
 
 64.6 
 
 
 64.6 
 
 Share based compensation 
 
 — 
 
 
 1.0 
 
 
 — 
 
 
 — 
 
 
 — 
 
 
 — 
 
 
 — 
 
 
 Balance at December 31, 2024 
 
 102,901 
 
 
 $ 
 5.8 
 
 
 
 38,993,300 
 
 
 $ 
 — 
 
 
 $ 
 478.0 
 
 
 $ 
 632.5 
 
 
 $ 
 1,110.5 
 
 
 Net income 
 
 — 
 
 
 — 
 
 
 
 — 
 
 
 — 
 
 
 — 
 
 
 76.2 
 
 
 76.2 
 
 
 Share based compensation 
 
 — 
 
 
 14.1 
 
 
 — 
 
 
 — 
 
 
 5.2 
 
 
 — 
 
 
 5.2 
 
 
 Issuance of restricted stock units 
 
 1,476,764 
 
 
 0.9 
 
 
 38,914 
 
 
 — 
 
 
 — 
 
 
 — 
 
 
 — 
 
 
 Repurchase and retirement of common stock 
 
 ( 594,570 ) 
 
 
 ( 8.9 ) 
 
 
 
 ( 11,019 ) 
 
 
 — 
 
 
 — 
 
 
 ( 0.2 ) 
 
 
 ( 0.2 ) 
 
 
 Reclassification of U.S. Treasury Warrants from liability awards to equity awards 
 
 — 
 
 
 — 
 
 
 
 — 
 
 
 — 
 
 
 7.4 
 
 
 — 
 
 
 7.4 
 
 
 Reclassification of RSUs from mezzanine equity 
 
 ( 985,095 ) 
 
 
 ( 11.9 ) 
 
 
 
 985,095 
 
 
 — 
 
 
 11.9 
 
 
 — 
 
 
 11.9 
 
 
 Issuance of common stock, par value $ 0.001 in connection with the Merger 
 
 — 
 
 
 — 
 
 
 
 2,853,542 
 
 
 — 
 
 
 59.8 
 
 
 — 
 
 
 59.8 
 
 
 Issuance of common stock, par value $ 0.001 deposited to escrow (2) 
 
 — 
 
 
 — 
 
 
 
 2,853,454 
 
 
 — 
 
 
 57.7 
 
 
 — 
 
 
 57.7 
 
 
 Balance at December 31, 2025 
 
 — 
 
 
 $ 
 — 
 
 
 
 45,713,286 
 
 
 $ 
 — 
 
 
 $ 
 620.0 
 
 
 $ 
 708.5 
 
 
 $ 
 1,328.5 
 
 

 (1) Mezzanine equity and shareholders’ equity have been retrospectively adjusted to apply the Exchange and Reverse Stock Split as discussed in Note 3, Merger with Mesa Air Group, Inc. 
 (2) See Note 3, Merger with Mesa Air Group, Inc. for further considerations of Escrow Shares. 
 See accompanying notes to the consolidated financial statements. 
 
 
 
 
 
 
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 REPUBLIC AIRWAYS HOLDINGS INC. AND SUBSIDIARIES 
 CONSOLIDATED STATEMENTS OF CASH FLOWS 
 FOR THE YEARS ENDED DECEMBER 31, 2025, 2024, and 2023 
 (In millions) 
 
 2025 2024 2023 
 OPERATING ACTIVITIES: 
 
 Net income 
 $ 76.2 $ 64.6 $ 54.8 
 Adjustments to reconcile net income to net cash from operating activities: 
 
 Depreciation and amortization 
 126.3 117.0 159.4 
 Deferred income taxes 
 33.9 17.2 29.3 
 Stock-based compensation expense 
 20.2 1.0 1.5 
 Other, net 
 8.3 11.9 18.6 
 Other, net—related parties 
 ( 2.4 ) ( 6.1 ) ( 18.5 ) 
 Changes in certain assets and liabilities, net of effects of the Merger: 
 
 Receivables 
 30.5 ( 2.5 ) ( 0.2 ) 
 Receivables—related parties 
 ( 38.0 ) ( 8.4 ) 55.5 
 Inventories (1) 
 0.4 ( 2.1 ) 4.6 
 Other assets 
 ( 15.8 ) ( 10.9 ) ( 3.8 ) 
 Other assets—related parties 
 ( 1.6 ) ( 20.6 ) ( 8.2 ) 
 Accounts payable and other current liabilities 
 ( 9.9 ) 25.1 32.8 
 Accounts payable and other current liabilities — related parties 
 29.9 ( 0.9 ) ( 0.8 ) 
 Other non-current liabilities 
 0.2 5.0 3.4 
 Other non-current liabilities—related parties 
 63.8 35.8 0.8 
 NET CASH PROVIDED BY OPERATING ACTIVITIES 
 322.0 226.1 329.2 
 
 INVESTING ACTIVITIES: 
 
 Purchase of property and equipment (1) 
 ( 396.9 ) ( 226.7 ) ( 378.1 ) 
 Proceeds from insurance, sale of property, and other equipment 
 0.7 86.1 133.5 
 Pre-delivery deposits paid (1) 
 ( 13.8 ) ( 32.9 ) ( 13.5 ) 
 Cash acquired in connection with the Merger 
 22.8 — — 
 Purchases of marketable securities and investments 
 ( 176.2 ) ( 187.3 ) ( 282.8 ) 
 Proceeds from the sale of marketable securities 
 212.5 255.3 120.0 
 NET CASH USED IN INVESTING ACTIVITIES 
 ( 350.9 ) ( 105.5 ) ( 420.9 ) 
 FINANCING ACTIVITIES: 
 
 Proceeds from issuance of debt 
 299.4 177.3 476.6 
 Payments on debt and finance lease obligations 
 ( 231.6 ) ( 240.1 ) ( 260.1 ) 
 Payments on early debt extinguishment 
 — ( 37.4 ) ( 101.0 ) 
 Payments for U.S. Treasury Warrant redemption 
 ( 1.1 ) — — 
 Taxes paid for the net share settlement of restricted stock units 
 ( 9.1 ) — ( 0.2 ) 
 Other, net 
 ( 2.9 ) ( 2.0 ) ( 8.2 ) 
 NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES 
 54.7 ( 102.2 ) 107.1 
 
 NET CHANGES IN CASH, CASH EQUIVALENTS, AND RESTRICTED CASH 
 25.8 18.4 15.4 
 CASH, CASH EQUIVALENTS, AND RESTRICTED CASH—Beginning of period 
 131.9 113.5 98.1 
 CASH, CASH EQUIVALENTS, AND RESTRICTED CASH—End of period 
 157.7 131.9 113.5 
 
 CASH PAID FOR: 
 
 Interest, net of capitalized amounts 
 $ 58.8 $ 56.0 $ 44.4 
 Income taxes, net of refunds 
 2.8 5.7 3.3 
 SUPPLEMENTAL DISCLOSURE OF NON-CASH TRANSACTIONS: 
 
 Non-cash Merger purchase consideration (Note 3) 
 120.2 — — 
 Property and equipment acquired, but not paid 
 13.4 7.6 15.0 
 Parts credits received from aircraft and engine manufacturers 
 6.1 4.0 6.7 
 Parts credits received from aircraft and engine manufacturers—related parties 
 1.4 0.5 1.4 
 Parts credits used from aircraft and engine manufacturers 
 — 0.5 — 

 (1) The Company made net aircraft, pre-delivery deposit payments, and inventory and rotable spare part purchases from its original equipment manufacturer, a related party, of $ 289.7 million, $ 168.2 million, and $ 294.8 million during the years ended December 31, 2025, 2024, and 2023, respectively. 
 See accompanying notes to the consolidated financial statements. 
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 REPUBLIC AIRWAYS HOLDINGS INC. AND SUBSIDIARIES 
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 
 FOR THE YEARS DECEMBER 31, 2025, 2024 AND 2023 
 
 1. ORGANIZATION & BUSINESS 
 Republic Airways Holdings Inc. (the “Company” or the “Parent”) is a Delaware holding company conducting substantially all of its operations through its wholly-owned regional air carrier subsidiaries, Republic Airways Inc. (“Republic Airways”) and Mesa Airlines, Inc. (“Mesa” or “Mesa Airlines”). The Company regularly provides scheduled passenger service on approximately 1,300 flights daily to approximately 130 cities in the United States, Canada, Mexico, and the Caribbean operating under the American Eagle, Delta Connection, and United Express brands through the Company’s partnerships with American Airlines, Inc. (“American Airlines”), Delta Air Lines, Inc. (“Delta Air Lines”), and United Airlines, Inc. (“United Airlines”) (collectively, our “Partners” or “Partner Airlines”) under fixed-fee capacity purchase agreements (“CPA,” or collectively, our “CPAs”). The Company’s operating subsidiaries, Republic Airways and Mesa Airlines, exclusively operate the Embraer E170/175 family of aircraft among our Partner Airlines’ hub and focus cities. 
 On November 25, 2025, the Company and Mesa Air Group, Inc. (“Mesa Parent”), former parent company of Mesa Airlines, completed the Merger of Republic Airways Holdings Inc. and Mesa Air Group, Inc., whereby the Company merged with and into Mesa Air Group, Inc. (the “Merger”). The legal entity Mesa Air Group, Inc. continued as the surviving corporation; however, upon completion of the Merger, the legal entity was renamed Republic Airways Holdings Inc . The Company, on a pre-Merger basis, is referred to as “Legacy Republic.” The Company includes the operations of Legacy Republic and, beginning on November 25, 2025, also includes the operations, financial position, and cash flows of the former entity Mesa Air Group, Inc. and its wholly-owned subsidiaries. See Note 3, Merger with Mesa Air Group, Inc. 
 The Company also operates its Leadership In Flight Training Academy (“LIFT Academy”) with a mission to attract a new generation of aviation professionals to commercial aviation by providing superior flight training, while addressing the economic, regulatory , and structural barriers to entry to the aviation industry by offering its graduates a defined career pathway to First Officer with Republic Airways. The Company also operates Bridge Air with a dedication to helping aviation professionals achieve their dream of becoming a commercial airline pilot as quickly, safely, and inexpensively as possible. 
 Aircraft under operation for each of our Partner Airlines as of December 31, 2025 are as follows: 
 
 Aircraft (1) (2) 
 American Airlines 
 Delta Air Lines 
 United Airlines 
 Total Aircraft 
 
 E170 
 13 11 4 28 
 E175 
 79 46 122 247 
 Total 92 57 126 275 

 (1) Represents the minimum operational fleet out of a total of 280 aircraft as of December 31, 2025, excluding five spare aircraft. 
 (2) Excludes 31 aircraft leased to American Airlines as of December 31, 2025. 
 Capacity purchase agreements —Each of our ﬁxed-fee CPAs are structured so that revenues are generally derived from (i) a ﬁxed fee per departure, ﬂight hour, and/or block hour of time incurred in addition to overall aircraft in service and aircraft per day fees, payable on a monthly basis; and (ii) a premium amount, which is earned by maintaining a minimum aircraft utilization and exemplary operating results. We additionally receive reimbursement from our Partner Airlines for direct expenses incurred, such as qualifying maintenance activities, insurance, and property taxes. 
 Certain charges such as fuel and landing fees are generally paid directly by the Partner Airlines, although the charges were incurred by the Company in ongoing operations. The Company refers to these charges as “Partner direct charges.” Pass-through charges are primarily recorded to revenues and the corresponding operating expense on a gross basis. Pass-through charges recorded on a net basis are not material. 
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 Pursuant to our ﬁxed-fee capacity purchase agreements, the Company provides passenger service on behalf of American Airlines, Delta Air Lines, and United Airlines, authorizing us to use the Partner Airlines’ two-character ﬂight designator codes (American Airlines—“AA,” Delta Air Lines—“DL,” and United Airlines—“UA”) to identify our ﬂights and fares directly within each Partner’s reservation systems, and to outfit our interior and exterior aircraft livery with Partner Airlines’ colors, logos, and service marks, allowing for joint marketing of our ﬂights by the operating regional air carrier and each of our Partner Airlines. Passenger tickets are issued by each of our Partner Airlines, who therefore bear the risk associated with fare competition and management of seat inventory. In addition, under the Company’s ﬁxed-fee arrangements with American Airlines, Delta Air Lines, and United Airlines, passengers of the Company are eligible for participation in the Partner Airlines’ frequent ﬂyer loyalty programs: AAdvantage®, SkyMiles®, and MileagePlus®, respectively. Support services such as reservations, ticketing, ground handling services, fuel procurement, commuter slot rights, and airport facilities are additionally provided by the Partner Airlines. Significant provisions to our CPAs, which are amended from time to time, are discussed in Note 5, Revenue Recognition. 
 
 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES 
 Basis of presentation —The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ( “ U.S. GAAP ” ) and include the accounts of Republic Airways Holdings Inc. and its wholly-owned subsidiaries. Beginning November 25, 2025 and in conjunction with the Merger, the consolidated financial statements include the accounts of Mesa Air Group, Inc. and its wholly-owned subsidiaries. Intercompany transactions and balances have been eliminated in consolidation. Certain prior year balances have been reclassified to conform to current year presentation, including additional captions for Other current assets — related party and Stock-based compensation expense on the accompanying financial statements. Also, s ee Note 4, Executive Separation and Merger-Related Items . 
 Use of estimates —The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the carrying amounts of assets and liabilities, reported amounts of revenues and expenses, and the related disclosures thereto as of and during the periods presented, which management reassesses and evaluates on an ongoing basis. Significant estimates include but are not limited to (i) revenue recognition, (ii) estimated useful lives and residual values of aircraft and equipment, (iii) provision for income taxes, (iv) estimated fair value assumptions supporting the fair value of certain investments, put options, and warrants, and (v) provisional estimated fair value assumptions used to determine the fair values of assets acquired and liabilities assumed in the Merger in conjunction with the application of the acquisition method of accounting for business combinations under Financial Accounting Standards Board ( “ FASB ” ) Accounting Standards Codification ( “ ASC ” ) 805, Business Combinations. See Note 3, Merger with Mesa Air Group, Inc. In addition, based on the nature of the CPA relationships, the Company estimates operating costs for certain reimbursable pass-through charges and records revenues based on these estimates. Actual results could materially differ from our initial estimates. 
 Cash, cash equivalents and restricted cash —Cash and cash equivalents consists of cash on-hand and short-term, highly liquid investments with maturities of three months or less when acquired. Substantially all of our cash on-hand is held with six financial institutions. Restricted cash primarily includes cash in escrow to secure letters of credit issued for workers’ compensation claim reserves, construction activities, student loan guarantees, and deposits with various airport authorities. 
 Investments —The Company holds investments in debt and equity securities, stock warrants and put options, and equity method investments. Investments classified as marketable securities relate primarily to U.S. Treasury securities and are recorded to marketable securities in the consolidated balance sheets. The Company designates securities as trading, available-for-sale, or held-to-maturity, as applicable, at the time of acquisition and are subsequently measured at fair value or amortized cost at each reporting date. All of the Company’s investments in marketable securities were held for trading purposes during the years ended December 31, 2025, 2024, and 2023, and as a result, realized and unrealized gains and losses are recorded to investment income and other, net in the consolidated statements of operations, representing Level 1 fair value measurements as defined in FASB ASC 820, Fair Value Measurement . 
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 Non-current investments are investments with maturities greater than 12 months, described below, or investments which management of the Company intends to hold for a period greater than 12 months. Non-current investments are subject to provisions of FASB ASC 321, Investments , and are recorded to other non-current assets in the consolidated balance sheets at their acquisition date fair value and subsequently measured to fair value at each reporting date. Non-current investments are Level 1 fair value measurements as defined in the FASB ASC 820, Fair Value Measurement , fair value hierarchy. Realized and unrealized gains and losses are recorded to investment income and other, net in the consolidated statements of operations. 
 The Company is additionally a warrant holder for stock warrants issued to certain initial investors in conjunction with our strategic partnership with EVE Holdings Inc. (“EVE”) for the development of electric vertical takeoff and landing (“eVTOL”) aircraft, exercisable through May 2027. Also related to our strategic relationship with EVE, the Company holds a put option attached to shares held in EVE equity that is exercisable on demand through May 2032. Stock warrants and the put option are characterized as financial instruments and are initially recorded and subsequently measured to fair value at each reporting date. Such amounts are recorded to other non-current assets in the consolidated balance sheets. Unrealized gains and losses are recorded to investment income and other, net in the consolidated statements of operations. 
 Equity method investments are initially measured at cost and subsequently adjusted for the Company’s proportionate share of income or loss of the investee and recorded to other non-current assets in the consolidated balance sheets in accordance with FASB ASC 323, Investments—Equity Method and Joint Ventures . The Company’s portion of income or loss generated by these investments are included as part of investment income and other, net in the consolidated statements of operations. The Company routinely monitors its investments for factors that may indicate a potential decline in value that is other than temporary. 
 The Company holds a 43.6 % ownership interest in Hyannis Air Service Inc. d/b/a Cape Air and Nantucket Airlines (“Cape Air”). The investment is meant to foster a strategic workforce relationship between the participating airlines. Upon completion of flight training at LIFT Academy , certain graduates can acquire First Officer and Captain experience at Cape Air until they have met experience requirements to fly with the Company. The Cape Air investment is accounted for under the equity method of accounting. As of December 31, 2025 and 2024, the Company ’ s investment totaled $ 15.3 million and $ 15.0 million, respectively, and is included in other non-current assets in the consolidated balance sheets. During the years ended December 31, 2025, 2024, and 2023, the Company recognized $ 0.3 million of earnings , a $ 0.1 million loss, and a $ 3.8 million loss in Cape Air, respectively, recorded to investment income and other, net, in the consolidated statements of operations . 
 Fair value of financial instruments —The Company measures cash and cash equivalents, restricted cash, debt and equity securities, warrants, and put options at fair value on a recurring basis. Fair value, which is defined as an exit price related to the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants, is measured using a combination of valuation practices as follows, as applicable: 
 Market approach —a valuation technique using prices and other relevant information generated by market transactions involving identical or comparable assets and liabilities (or groups of assets and liabilities). 
 Income approach —valuation approach which converts future amounts to a single current (discounted) amount and is determined on the basis of the value indicated by current market expectations about those future amounts. 
 The Company classifies its fair value measurements based on the fair value hierarchy defined in ASC 820, Fair Value Measurement , which prioritizes the inputs used in determining fair value as follows: 
 Level 1 Quoted prices (unadjusted) in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date. 
 Level 2 Quoted prices for similar assets or liabilities in active markets or quoted prices for identical or similar assets or liabilities in markets that are not active. 
 Level 3 Unobservable inputs for the asset or liability. 
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 Inventories —Inventories consist of spare aircraft parts and supplies, which are charged to expense as consumed in the Company’s operations. Aircraft inventory is stated at weighted average cost at the lower of cost or its net realizable value. Inventory valuation adjustments are recorded to maintenance and repair expense in the consolidated statements of operations. The inventory valuation adjustments for the years ended December 31, 2025, 2024, and 2023 were $ 1.1 million, $ 2.2 million, and $ 0.8 million, respectively. 
 Assets held for sale —The Company classifies assets as held for sale when (i) management commits to a plan to sell the asset; (ii) the asset is available for immediate sale in its present condition, subject only to terms that are usual and customary for sales of such assets; (iii) an active program to locate a buyer and other actions required to complete the plan to sell the asset has been initiated; (iv) the sale of the asset is probable, and transfer of the asset is expected to occur within one year, among other conditions. Assets designated as held for sale are recorded to other current assets in the consolidated balance sheets at the lower of their current carrying values or their fair market values, less costs to sell, beginning in the period in which the assets meet the criteria to be classified as held for sale. The account balance is not material. 
 Property and equipment —The Company records property and equipment at its historical cost, less accumulated depreciation, which is charged to expense on a straight-line basis over the estimated useful life of the related asset. Effective January 1, 2024, the Company adjusted the estimated useful life of certain aircraft, rotable spare parts, and engines from 22.0 to 26.0 years to more closely align with market data impacting our fleet usage pattern. The change in accounting estimate decreased depreciation and amortization expense by $ 50.5 million for the year ended December 31, 2024 on then-current fleet assets. Estimated useful lives and residual values for each asset class are as follows: 
 
 Asset Class 
 Current Useful 
 Life Effective 
 January 1, 2024 
 (Years) 
 Previous Useful Life Effective December 31, 2023 and Prior (Years) Residual Value 
 Building 
 39.0 39.0 — 
 Regional jet aircraft 
 26.0 22.0 0.0 % – 10.0 % 
 
 General aviation aircraft, engines, and flight equipment 
 10.0 – 26.0 
 
 10.0 – 22.0 
 0.0 % – 50.0 % 
 
 Office equipment and leasehold improvements 
 3.0 – 20.0 
 
 3.0 – 20.0 
 — 

 Management reviews asset groups for impairment when events and business circumstances indicate carrying values of assets may not be recoverable. In such circumstances, management evaluates undiscounted cash flows expected to be generated by the respective asset group in comparison to its carrying value. Impairment charges, if any, are measured based on the excess carrying value over estimated fair value of the asset group. No impairment charges were recognized during the years ended December 31, 2025, 2024, and 2023. 
 Goodwill —Goodwill represents the excess of consideration exchanged over the fair value of identifiable assets acquired and liabilities assumed in conjunction with a business combination. Goodwill is initially recognized to comply with ASC 805, Business Combinations. Goodwill is assigned to the relevant reporting unit and is reviewed at least annually on October 31, or more frequently, if conditions indicate the carrying value of goodwill may not be recoverable to comply with provisions of ASC 350, Intangibles – Goodwill and Other. 
 The changes in the carrying amount of goodwill for the years ended December 31, 2025, 2024, and 2023 are as follows: 
 
 (in millions) 
 Balance as of 12/31/2025 
 Additions 
 Balance as of 12/31/2024 
 Additions 
 Balance as of 12/31/2023 
 Additions 
 Balance as of 1/1/2023 
 Carrying amount of goodwill 
 $ 122.5 
 
 $ 120.4 
 
 $ 2.1 
 
 — 
 
 $ 2.1 
 
 $ 2.1 
 
 — 
 

 The Company recorded no impairments during the years ended December 31, 2025, 2024, and 2023. 
 Manufacturer incentives —The Company’s aircraft and original equipment manufacturers periodically provide credits and rebates toward aircraft and equipment part purchases. Incentives associated with aircraft and equipment are applied as a reduction to the aircraft and equipment purchase price upon delivery, effectively reducing depreciation expense on a straight-line basis over aircraft and engine useful lives . 
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 Income taxes —The Company accounts for income taxes using the asset and liability method. Under the asset and liability method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts for existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in future years in which those temporary differences are expected to be recovered or settled. The measurement of deferred tax assets is adjusted by a valuation allowance, if necessary, to recognize future tax benefits to the extent that it is more likely than not they will be realized based on available evidence. The Company establishes liabilities for uncertain positions taken or expected to be taken in income tax returns, using a more-likely-than-not recognition threshold. The Company utilizes the enacted tax rate of 21.0% for federal income tax purposes. See Note 11 , Income Taxes . 
 Aircraft maintenance and repair —Aircraft maintenance and repair charges, including line maintenance, routine overnight maintenance, auxiliary power units, and airframe and engine overhaul are accounted for using the direct expense method. 
 In addition, the Company enters into long-term maintenance agreements that fix certain costs related to engines and other airframe components. Risks associated with these arrangements have been transferred to maintenance providers, and therefore, corresponding maintenance charges are recognized as power-by-the-hour contracts at a level rate per hour, subject to customary minimum utilization requirements. See Note 12 , Commitments . 
 Mezzanine equity — During the year ended December 31, 2020, the Company adopted the 2020 Omnibus Incentive Plan in which restricted stock units (“RSUs”) were issued to members of the Board of Directors and key members of management. RSUs are conditionally redeemable upon the occurrence of events that are not solely within control of the issuer of the securities. As such, RSUs are classified as mezzanine (temporary) equity as to convey that these shares may not have a permanent equity classification. All of the Company’s RSUs classified as mezzanine equity were reclassified to common stock and additional paid-in-capital at consummation of the Merger. See Note 14, Mezzanine Equity and Capital Transactions. 
 Shareholders’ equity —Shareholders’ equity consists of preferred stock, par value $ 0.001 , 500,000,000 shares authorized and no shares issued or outstanding as of December 31, 2025 and 2024 ; common stock, par value $ 0.001 , 5,000,000,000 shares authorized, 45,713,286 shares and 38,993,300 shares issued and outstanding, respectively, as of December 31, 2025 and 2024 . Additional paid-in capital consists of capital amounts contributed in excess of par value. 
 In conjunction with the Merger, Mesa Air Group, Inc. effectuated a 15-for-1 reverse stock split (the “Reverse Stock Split”). Further, in conjunction with the Merger closing, the Company received 38.9933 shares of common stock of legacy Mesa Air Group in exchange for and cancellation of each outstanding share of legacy Republic Airways common stock immediately prior to the Merger (the “Exchange”). Presentation of shareholders’ equity as of December 31, 2025 and 2024 retrospectively applies the Reverse Stock Split and the Exchange to consistently conform and to comply with the relevant provisions of ASC 505, Shareholders’ Equity . 
 The Company additionally holds an equity participating right of $ 2.3 million as of December 31, 2025 for the settlement of shares held in escrow for the final settlement of consideration exchanged in the Merger, which is recorded as a reduction to additional paid-in capital in the consolidated balance sheets. See Note 3, Merger with Mesa Air Group, Inc. 
 U.S. Treasury Warrants —In 2020 and 2021 , in connection with the Coronavirus Aid, Relief, and Economic Security Act of 2020 (the “ CARES Act ” ) payroll support program ( “ PSP ” ) and extensions, the Company issued to the U.S. Treasury warrants (the “ U.S. Treasury Warrants ” ) to purchase shares of the Company’s common stock under the Payroll Support Programs and Secured Loans ( “ PSP Loan ” ). The warrants have a five -year term from the date of issuance. The weighted average grant-date fair value of these warrants was estimated using the Black-Scholes option pricing model. The current holder of the warrants exercised 315,534 warrants during the year ended December 31, 2025 . The Company settled the exercise through net cash disbursements totaling $ 1.1 million to the holder. As of November 25, 2025, the U.S. Treasury Warrants were reclassified from liability awards to equity awards upon the closing of the Merger as the Company may elect a cash or net share settlement. Prior to the Merger, as the Company’s common stock was not listed on a national securities exchange, the Company was required to net cash settle. As of December 31, 2025 , the Company had 691,701 
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 warrants issued and outstanding. On January 30, 2026, the Company adopted the Omnibus Amendment with the U.S. Treasury to settle the outstanding U.S. Treasury Warrants as of December 31, 2025 in cash. The U.S. Treasury Warrants were settled on February 18, 2026 totaling $ 5.3 million. As of February 18, 2026, the Company has no remaining warrants outstanding. The Company did not issue any warrants for the years ended December 31, 2025 and 2024 . 
 Measurement of U.S. Treasury Warrants represents a Level 3 fair value measurement within the fair value hierarchy as defined by ASC 820, Fair Value Measurement . Fair value adjustments are recorded to investment income and other, net in the consolidated statements of operations. See Note 6 , Fair Value Measurements . 
 Net income per common share— Basic and diluted net income per common share were as follows: 
 
 Year Ended December 31, 
 (in millions, except share and per share data) 2025 2024 2023 
 Numerator: 
 Net Income 
 $ 76.2 $ 64.6 $ 54.8 
 
 Denominator: 
 Weighted-average common shares outstanding - basic 
 40,020,266 39,096,437 39,084,367 
 Dilutive effects of restricted stock units 605,389 662,838 569,606 
 Dilutive effects of U.S. Treasury Warrants 31,865 — — 
 Adjusted weighted-average common shares outstanding - diluted 
 40,657,520 39,759,275 39,653,973 
 
 Net income per common share: 
 
 Basic 
 $ 1.90 $ 1.65 $ 1.40 
 Diluted 
 $ 1.87 $ 1.62 $ 1.38 

 Basic net income per common share is computed by dividing net income attributable to the Company by the weighted average number of common shares outstanding during the period. The number of incremental shares from the assumed issuance of shares relating to restricted stock units and the exercise of warrants (excluding warrants with a nominal conversion price) is calculated by applying the treasury stock method. 344,237 weighted-average shares have been excluded from the calculation of diluted net income per common share for each period presented, as the related performance conditions have not been met. 
 Segment information — The Company is organized and operates as one operating and reportable segment: regional airline services. Substantially all of the Company’s revenues are derived from customers within the United States. 
 This determination is based on the management approach which designates internal information regularly available to the Chief Operating Decision Maker (“CODM”) for making decisions and assessing performance as the source of determination of the Company’s reportable segments. The Company’s CODM, the Chief Executive Officer, reviews financial information presented on a consolidated basis for the purpose of making operating decisions and assessing financial performance. 
 The accounting policies of the one reportable segment are the same as those described in the summary of significant accounting policies. The CODM uses income before income taxes, as reported in our consolidated statements of operations, to measure segment profit or loss, assess performance, and make strategic capital resources allocations. The measure of segment assets is reported on our consolidated balance sheets as total assets. The significant expense categories regularly provided to the CODM are the expenses as presented on the consolidated statements of operations. 
 Recent accounting pronouncements— In December 2023, the FASB issued ASU 2023-09— Improvement to Income Tax Disclosures (Topic 740) , to provide clarifying guidance on the transparency of income tax disclosures. ASU 2023-09 is effective for public entities for annual reporting periods beginning after December 15, 2024. The Company adopted ASU 2023-09 on December 31, 2025 and applied the new disclosure requirements retroactively. Prior period disclosures have been adjusted to reflect the new disclosure requirement. The impact of the implementation to the 
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 consolidated financial statements and related disclosures was not material. See Note 11, Income Taxes in the accompanying notes to the consolidated financial statements. 
 In November 2024, the FASB issued ASU 2024-03— Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40) , to provide investors with more granular detail on cost of sales, and selling, general, and administrative expenses. ASU 2024-03 is effective for public entities for fiscal years beginning after December 15, 2026, with early adoption permitted. The Company is currently evaluating the impact the standard will have to the consolidated financial statements and related disclosures. 
 In May 2025, the FASB issued ASU 2025-03— Business Combinations (Topic 805) and Consolidation (Topic 810): Determining the Accounting Acquirer in the Acquisition of a Variable Interest Entity , which revises the guidance in ASC 805, Business Combinations , on identifying the accounting acquirer in a business combination in which the legal acquiree is a variable interest entity ( “ VIE ” ). ASU 2025-03 is effective for public entities with fiscal years beginning after December 15, 2026 with early adoption permitted. The Company early adopted ASU 2025-03 on January 1, 2025, and the impact of the implementation to the consolidated financial statements was not material. 
 In September 2025, the FASB issued ASU 2025-06— Intangibles—Goodwill and Other— Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software, to improve the guidance related to the capitalization of software development costs . ASU 2025-06 is effective for public entities for fiscal years beginning after December 15, 2027, with early adoption permitted. The Company is currently evaluating the impact the standard will have to the consolidated financial statements and related disclosures. 
 In December 2025, the FASB issued ASU 2025-11 — Interim Reporting (Topic 270): Narrow Scope Improvements, which clarifies the current requirements under Topic 270. The ASU provides a comprehensive list of required interim disclosures and requires entities to disclose events since the end of the last annual reporting period that have a material impact on the entity. ASU 2025-11 is effective for public entities for interim periods in fiscal years beginning after December 15, 2027 with early adoption permitted. The Company is currently evaluating the impact the standard will have to the consolidated financial statements and related disclosures. 
 
 3. MERGER WITH MESA AIR GROUP, INC. 
 On November 25, 2025, Legacy Republic completed the Merger with Mesa Parent with the Mesa Parent legal entity continuing as the surviving corporation. Upon closing of the Merger, Mesa Parent was renamed Republic Airways Holdings Inc. The business conducted by the surviving corporation following completion of the Merger is primarily the business conducted by Legacy Republic, and beginning on November 25, 2025, includes the financial position, results of operations, and cash flows of pre-Merger Mesa Parent and subsidiaries, and is referred to on a post-Merger basis as the “Company.” The Company is led by executive leadership of Legacy Republic. Legacy Republic designated six of seven directors to the Board of Directors of the Company, while Mesa Parent designated one of seven directors. 
 Legacy Republic and Mesa Parent pursued the Merger in order to enhance the scale of the combined company, both financially and operationally, to create a larger single fleet type and to provide for greater access to capital markets. In addition, the Company pursued the Merger in order to obtain extended termination dates under a new 10-year CPA with United Airlines. 
 In connection with the Merger and immediately prior to the effective time of the Merger (the “Effective Time”), Mesa Parent converted from a Nevada corporation to a Delaware corporation pursuant to a plan of conversion (the “Conversion”). At the Effective Time, each share of Legacy Republic common stock, par value $ 0.001 per share, (excluding (i) shares to be cancelled pursuant to the Merger Agreement and (ii) any dissenting shares for which appraisal rights were properly demanded in accordance with Delaware law) was converted into the right to receive 38.9933 (the “Exchange Ratio”) validly issued, fully paid and non-assessable shares of Mesa Parent common stock, par value $ 0.001 , with cash paid in lieu of any fractional shares. Immediately prior to the Effective Time, each outstanding RSU in respect of shares of Legacy Republic common stock became vested and was cancelled. The Exchange Ratio gives effect to an unadjusted post-Merger capitalization of an 88.0 % allocation to Legacy Republic pre-Merger shareholders, a 6.0 % 
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 allocation to Mesa pre-Merger shareholders, and a 6.0 % allocation (the Escrow Shares discussed below) available for repayment of certain Mesa liabilities described below for the settlement of final working capital amounts and unsettled obligations of Mesa. 
 Further, Legacy Republic and Mesa Parent concurrently entered into the Three Party Agreement jointly with United Airlines to give effect to actions which facilitated an orderly wind down and disposition of certain assets, extinguishment of certain liabilities, and conditions not subject to the business combination and exchange of merger consideration. The Three Party Agreement provided for, among other things, completion of the following actions at and prior to the closing of the Merger: 
 (i) Termination of the United CPAs among Mesa and United Airlines; 
 (ii) Disposition by sale of certain Canadair Regional Jet (“CRJ”) aircraft, CRJ spare engines, an Embraer Regional Jet (“ERJ”) spare engine, and Boeing B-737 spare inventories; 
 (iii) Repayment of substantially all trade debts, long-term debts, and remaining liabilities of Mesa Parent and subsidiaries (“Mesa Net Debt”), utilizing the cash on hand of $ 19.6 million and cash proceeds from asset sales set forth in item (ii) above of $ 8.4 million. Upon depletion of Mesa Parent cash applied for the full and final satisfaction of trade debts, long-term debts, and remaining liabilities, United Airlines provided a one-time cash payment of $ 23.6 million for funding at Merger closing sufficient to discharge any obligations of Mesa Parent which remained outstanding at Merger close. As of November 25, 2025, all long-term debt encumbrances of Mesa Parent prior to Merger closing were discharged through repayment of amounts due or forgiveness by the counterparty; 
 (iv) Transfer of all Mesa rights and obligations related to its warrant and aircraft purchase agreements with Archer Aviation Inc. related to investments in, development of, and commitment for forward purchase of eVTOL aircraft to a third party; 
 (v) Extension of certain CPA terms between Mesa and United Airlines, including enhanced/increased rates retrospectively from January 2025 through termination of the CPAs concurrent with Merger closing, which enhanced the ability of Mesa to discharge those debts set forth in item (iii); 
 (vi) Issuance of 2,853,454 shares of common stock, par value $ 0.001 , equivalent to approximately 6.0 % of the issued and outstanding shares of the Company’s post-Merger common stock (the “Escrow Shares”). 
 Escrow Shares were settled February 9, 2026 following completion of a 60-day review and resolution period, which shares (a) first become allocable to United Airlines in exchange for the forgiveness and repayment of certain debts and obligations of Mesa; (b) second, to the extent any of the remainder become available to the Company to repay certain liabilities which were not known at Merger closing, and (c) third, to the extent of any remainder, become available on a pro rata basis to shareholders of Mesa immediately prior to consummation of the Merger and Merger-related agreements. During 2026, Escrow Shares of 2,744,348 were allocated to United Airlines in exchange for settlement and satisfaction of adjusted Mesa Net Debt of $ 51.7 million, and the residual 109,106 Escrow Shares were allocated to the Company, in satisfaction of the preceding item (b). Shares of common stock of the Company that were returned to the Company were retired upon receipt. No Escrow Shares were available for allocation to pre-Merger Mesa Parent shareholders. 
 The Company recorded an equity participation right of $ 2.3 million as of November 25, 2025 for the value of shares reallocated to the Company in final settlement of the Escrow Shares in the consolidated balance sheets and was included as a component of Merger consideration exchanged. Such amount was recorded as a reduction to additional paid-in-capital in the consolidated balance sheets. The effect of final allocation of the Escrow Shares results in an 88.1 % interest in the Company held by pre-Merger Legacy Republic shareholders, a 6.0 % interest in the Company held by pre-Merger Mesa Parent shareholders; and a 5.9 % interest held by United Airlines, paid in full and final satisfaction of outstanding liabilities of Mesa Parent at Merger closing. The issuance of common stock to effectuate the Merger is as follows as of November 25, 2025: 
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 Mesa common stock outstanding as of November 25, 2025 (1) 
 
 2,792,531 
 Issuance of Mesa Parent RSUs at vesting concurrent with closing of Merger 61,011 
 Total Mesa common stock 2,853,542 
 Republic common stock outstanding as of November 25, 2025 1,004,108 
 Shares of Republic RSUs issued and vested upon closing of Merger 
 21,156 
 Total Republic common stock 1,025,264 
 Exchange Ratio 38.9933 
 Resulting shares of Mesa common stock issued for Republic shares outstanding (2) 
 39,978,395 
 Issuance of Republic restricted stock units 1,264,210 
 Shares of common stock of Mesa before the application of the Three Party Agreement 44,096,147 
 Mesa common stock issued in accordance with the Three Party Agreement ( 6.0 % of the total Mesa shares of common stock at closing of the Merger) 
 
 2,853,454 
 Total outstanding shares of common stock and restricted stock units as of November 25, 2025 46,949,601 

 (1) The amounts presented herein give effect to the Reverse Stock Split. 
 (2) Fractional shares were settled in cash. 
 On September 24, 2025, Mesa Parent effected a change in its fiscal year historically ending on September 30 to align with the fiscal year of the Company ending on December 31, which became effective on January 1, 2025. 
 Prior to the Merger, effective at 6:00 p.m. Eastern Time on November 24, 2025, Mesa Parent effected the Reverse Stock Split. The consolidated financial statements and notes thereto include the effect of the 15-for-1 reverse stock split. 
 Further, on November 25, 2025, the Company entered into a new 10-year CPA with United Airlines and Mesa, now a wholly-owned subsidiary of the Company, to operate 60 E175 aircraft owned by United Airlines and operated by Mesa. Upon effectiveness of the new CPA, the Company received $ 49.0 million as a non-refundable up front fee funded by United Airlines to compensate for Merger-related expenses, and is recognized ratably on a straight-line basis to revenues over the 10-year term of the related CPA and was recorded to accounts payable and accrued and other expenses—related parties and other non-current liabilities—related parties in the consolidated balance sheets. The CPA in effect immediately prior to consummation of the Merger between Mesa Parent, Mesa, and United Airlines was terminated. 
 The Merger is accounted for as a reverse acquisition under provisions of FASB ASC 805, Business Combinations , using the acquisition method of accounting. Legacy Republic is designated the accounting acquirer and legal acquiree for financial reporting purposes on the basis that, immediately following consummation of the Merger, (i) shareholders of Legacy Republic hold a substantial majority of the voting interest in the Company, (ii) Legacy Republic designated six of seven director positions on the Company’s Board, and (iii) senior management of Legacy Republic retained all named executive officer positions within the Company following the Merger. The accounting for the Merger as a reverse acquisition resulted in the issuance and relinquishment of 11.9 % of the pre-Merger voting interest in Legacy Republic as consideration in exchange for certain net assets of Mesa, which is measured at the acquisition date fair value of the consideration exchanged. 
 Merger consideration 
 Total Merger consideration exchanged is $ 120.2 million, consisting primarily of common stock, par value $ 0.001 exchanged. Under the reverse acquisition method of accounting for the Merger in accordance with ASC 805, Business Combinations, the fair value of purchase price consideration is the fair value of hypothetical stock issued to Mesa Parent pre-Merger shareholders as an estimate of the relinquished value of equity by the accounting acquirer. Merger consideration as of November 25, 2025 was as follows: 
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 Merger consideration (in millions, except share and per share amounts) 
 
 
 Total shares outstanding 46,949,601 
 
 Price per share at fair value (1) 
 $ 
 21.00 
 
 Implied enterprise value $ 
 985.9 
 
 Republic equity relinquished (2) 
 
 11.9 % 
 
 Equity Merger consideration at fair value 117.5 
 
 Other consideration at fair value 2.7 
 
 Total Merger consideration $ 
 120.2 
 

 (1) Closing stock price of Mesa Parent common stock at close of business immediately prior to Merger closing, November 24, 2025. 
 (2) Includes settlement of Escrow Shares allocable to the Company accounted for as an equity participation right in the consolidated balance sheet as of November 25, 2025. 
 Fair values of assets acquired and liabilities assumed 
 The acquisition method of accounting to comply with ASC 805, Business Combinations, requires, among other things, that assets acquired and liabilities assumed are recognized on the consolidated balance sheet at fair value as of the acquisition date, with certain exceptions. The fair values of assets acquired and liabilities assumed were determined using market comparisons for like assets of similar vintage and condition. 
 We have completed valuation analyses necessary to assess the fair values of the assets acquired and liabilities assumed and the amount of goodwill to be recognized as of the acquisition date. These fair values were based on management’s estimates and assumptions; however, the determination of fair values of assets acquired and liabilities assumed is preliminary and is subject to adjustment as additional information is obtained about the facts and circumstances that existed as of the acquisition date. Due to (i) the proximity of Merger-closing to the Company’s fiscal year end measurement date; (ii) the complexity of income tax estimates, and (iii) an ongoing Internal Revenue Service audit, management of the Company continues to evaluate its estimates and assumptions utilized to calculate fair values of inventories, property and equipment, goodwill, income taxes, accounts payable, and accrued and other liabilities as new information is obtained. Preliminary amounts reflected in the fair values of assets acquired and liabilities assumed will be adjusted to reflect new information obtained, as necessary, up to one year following Merger closing with corresponding adjustments to goodwill. 
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 The Company recorded a preliminary allocation of Merger consideration to assets acquired and liabilities assumed based on their estimated fair values as of November 25, 2025. The following table summarizes the preliminary purchase price allocation, including resulting goodwill: 
 
 (in millions) Provisional Fair Value 
 Assets acquired: 
 Cash and cash equivalents 
 $ 19.6 
 Inventories 
 19.5 
 Other current assets 
 14.5 
 Other current assets—related parties 
 25.7 
 Property and equipment 
 22.6 
 Deferred income taxes 
 19.0 
 Goodwill 
 120.4 
 Other non-current assets 
 8.9 
 Total assets acquired 250.2 
 Liabilities assumed: 
 Operating lease liability 
 6.6 
 Accounts payable 
 55.3 
 Accounts payable—related parties 
 0.7 
 Accrued expenses and other current liabilities 
 65.9 
 Accrued expenses and other current liabilities—related parties 
 0.5 
 Other non-current liabilities 
 1.0 
 Total liabilities assumed 130.0 
 Net assets acquired $ 120.2 

 The composition of goodwill is principally derived from the assembled workforce of Mesa, whereby management derives a benefit from the aggregation of a highly-trained technical workforce which is not separable from goodwill. No other significant intangible assets are separately identifiable from goodwill. None of the goodwill is expected to be deductible for income tax purposes. 
 Additionally, the Company accounted for executive compensation for severance and consulting fees payable to Mesa Parent named executive officers separately from the Merger, as the negotiation and determination of such amounts, in part, were influenced by parties to the Three Party Agreement. Payment of $ 10.5 million was reimbursed by United Airlines for the related separation costs and was recorded on a net basis to executive separation and Merger-related items in the consolidated statements of operations and to accrued and other liabilities in the consolidated balance sheets as of December 31, 2025. 
 Results of operations of Mesa for the period from November 25, 2025 through December 31, 2025 
 
 (in millions) 
 
 2025 
 Revenues 
 $ 42.2 
 Net loss 
 ( 0.5 ) 

 Mesa’s net loss for the period from November 25, 2025 through December 31, 2025 includes the recognition of $ 6.6 million in expenses that were incurred from Merger closing and integration activities for the period then ended. See Note 4, Executive Separation and Merger-Related Items . The Company expects to incur expenses of this nature over the next 18 to 24 months. 
 Supplemental pro forma information 
 The following unaudited pro forma financial information presents a summary of the combined results of the Company and Mesa as if the acquisition had occurred on January 1, 2024. This pro forma information is for illustrative 
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 purposes only and does not purport to represent what the actual results of operations would have been if the acquisition had occurred on the assumed date, nor are they necessarily indicative of the results of operations that may be achieved in the future. 
 
 (in millions) 
 
 2025 
 2024 
 Revenues 
 $ 2,030.8 $ 1,934.8 
 Net income (loss) 
 2.7 ( 74.1 ) 

 
 4. EXECUTIVE SEPARATION AND MERGER-RELATED ITEMS 
 The Company separately classified executive separation and Merger-related items in the consolidated statements of operations, as such amounts are not anticipated to be incurred each year on a recurring basis. Certain prior year balances have been reclassified to conform to current year presentation. 
 Executive separation —During the year ended December 31, 2025, Bryan K. Bedford, the Company’s former Chief Executive Officer, was nominated and subsequently confirmed for service as Administrator of the Federal Aviation Administration, thereby terminating his employment with the Company on July 1, 2025. Matthew Koscal, Executive Vice President and Chief Administrative Officer, was promoted to President and Chief Commercial Officer of the Company, and David Grizzle, Chairman of the Board of Directors of the Company, began serving as Chief Executive Officer upon Mr. Bedford’s retirement on July 1, 2025. The Company recorded aggregate cash and share based compensation expenses related to the modification and acceleration of restricted stock awards upon Mr. Bedford’s termination of $ 20.8 million and zero during the years ended December 31, 2025 and 2024 to executive separation and Merger-related items in the consolidated statements of operations, which includes $ 2.0 million related to subsequent remeasurements of Mr. Bedford’s awards. Further, d uring the year ended December 31, 2025, the Company announced that the Board of Directors expects to promote Matthew Koscal to the position of Chief Executive Officer within the year ending December 31, 2026, at which time David Grizzle will return to the position of non-executive Chairman of the Board of Directors. Any final succession decision will be determined at a future undetermined date, in the sole discretion of the Board of Directors. 
 Additionally, during the year ended December 31, 2025 and in connection with the Merger, the Company recognized net severance expense of $ 5.4 million related to the separation of Mesa Parent named executive officers. 
 Merger-related items —The Company incurred certain expenses for legal, audit, and advisory fees supporting Merger due diligence, registration of securities and SEC filings, Merger planning, and integration costs during the year ended December 31, 2025. Integration costs include the elimination of duplicate overheads and abandonment of certain operating agreements, including fleet-specific training and facilities. The Company has additionally incurred integration costs related to aircraft maintenance bridging, and standardization of crew training during the year ended December 31, 2025. All costs of this nature are presented in executive separation and Merger-related items in the consolidated statements of operations. Amounts incurred during the years ended December 31, 2024 and 2023 were reclassified to consistently conform presentation. 
 Executive separation and Merger-related items incurred during the years ended December 31 are as follows: 
 
 (in millions) 
 
 2025 
 2024 
 2023 
 Executive separation 
 
 $ 26.2 
 $ — 
 $ — 
 Merger-related items 
 20.9 
 3.2 
 0.3 
 Total 
 $ 47.1 
 $ 3.2 
 $ 0.3 

 
 5. REVENUES 
 The Company accounts for contracts with our Partner Airlines under ASC 606, Revenue from Contracts with Customers , and ASC 842, Leases , as applicable, when each party has committed to perform under the contract, each party’s rights and payment terms have been established, when the contract has commercial substance, and when collectability of amounts due under the contract is probable. Under CPAs with our Partner Airlines, the Company has 
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 committed to perform various flight services and maintenance activities classified as regional jet services. Within regional jet services, flight services represent a series of distinct activities accounted for as a single performance obligation satisfied over time as flights are completed. The Company recognizes certain maintenance activities as separate performance obligations, which are satisfied as the related distinct service is complete. Substantially all of the Company’s revenues are generated from regional jet services. 
 Revenues associated with regional jet services are generally derived from (i) a fixed fee per departure, flight hour, and/or block hour of time incurred and a fixed rate for available-to-schedule aircraft, payable on a monthly basis; and (ii) a premium amount which is earned monthly and quarterly by maintaining minimum aircraft utilization levels and exemplary operating results. To the extent that minimum targets are not achieved, the Company could be subject to financial penalties. These fixed-fee rates are contractually subject to periodic economic adjustment. The Company additionally receives reimbursement from our Partner Airlines for direct expenses incurred such as qualifying maintenance activities, property taxes, and miscellaneous operating expenses. Certain charges such as fuel, landing fees, and certain ownership costs are generally paid directly by the Partner Airlines, although the charges were incurred by the Company in ongoing operations. The Company refers to these charges as “Partner direct charges.” Pass-through charges are primarily recorded to revenues and the corresponding operating expense on a gross basis. Pass-through charges recorded on a net basis are not material. 
 Amounts recognized as regional jet services revenues are measured at the contractual amount the Company expects it will be entitled to in exchange for the promised services. The Company allocates the transaction price as flights are completed with variable consideration that relates specifically to the Company’s efforts in delivering each flight recognized in the period in which the individual flight is completed and measured on a monthly basis. The Company records an estimate for incentive revenue based on our expected performance at the end of each period. These estimates are derived under accounting guidance related to variable consideration constraints and based on amounts expected to be collected. The Company has concluded that allocating the variability directly to individual flights results in an overall allocation meeting the objectives in ASC 606. This results in a pattern of revenue recognition that generally follows the variable amounts billed from the Company to Partner Airlines. As allowed with ASC 606, the Company has elected to apply practical expedients to expense significant financing components and the incremental costs of obtaining a contract as incurred. 
 A portion of the Company’s compensation under its CPAs is designed to reimburse the Company for certain aircraft ownership costs. The Company has concluded that a component of its revenue under the CPAs is deemed to be embedded lease revenue and as such, agreements identify the right-of-use of a specific type and number of aircraft over the term of the CPA. Embedded lease revenue associated with the Company’s CPAs is accounted for as an operating lease under ASC 842, Leases . 
 American Airlines 
 During the year ended December 31, 2023, the Company and American Airlines reached agreement for a four-year extension of 76 E175 aircraft under operation according to the CPA, which became effective on January 1, 2024. In addition, during the year ended December 31, 2024, the Company sold six E175 aircraft to American Airlines for proceeds of $ 49.3 million, net of debt repayment and fees. 
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 Key provisions of our CPAs, as amended, are summarized as follows: 
 
 American Airlines 
 
 Operational aircraft—December 31, 2025 
 92 (1) (2) 
 
 
 
 
 Aircraft type 
 E170/E175 
 
 
 
 Seating configuration 
 65 – 76 seats 
 
 
 
 
 Scheduled expiration (3) 
 
 December 2028 – October 2033 
 
 
 
 
 Significant pass-through / Partner direct charges 
 Pass-through —insurance, property taxes, certain cabin refurbishments, and miscellaneous station expenses 
 Partner direct charges —aircraft fuel, landing fees, ground handling operations, and on-board catering 
 

 (1) Includes three maintenance aircraft allocated to the American Airlines CPAs. 
 (2) Excludes 31 aircraft leased to American Airlines. 
 (3) Unless otherwise extended or amended, the CPAs expire once all applicable aircraft are withdrawn from the agreements. The American Airlines CPAs provide for extension at the option of American Airlines and are subject to early termination provisions for cause after satisfying the applicable notice period and failure to cure. Additionally, American Airlines has the right to terminate the American Airlines CPAs and require that the Company immediately cease operations of American Eagle flights if, among other things, the Company fails to maintain certain controllable completion rates and controllable on-time departure targets. Following the occurrence of a labor strike for six consecutive days, American has the right to purchase certain aircraft from us within 60 days of providing written notice to the Company regardless of whether such labor strike is later resolved. 
 Delta Air Lines 
 In February 2026, the Company and Delta Air Lines reached agreement for a three-year extension of five E170 aircraft under operation according to the CPA. New term dates for the related aircraft expire beginning October 2029. 
 Key provisions of our CPAs, as amended, are summarized as follows: 
 
 Delta Air Lines 
 
 Operational aircraft—December 31, 2025 57 
 
 Aircraft type E170/E175 
 
 Seating configuration 69 – 76 seats 
 
 
 Scheduled expiration (1) 
 November 2027 – June 2030 
 
 
 Significant pass-through / Partner direct charges Pass-through —insurance, property taxes, certain planned major maintenance activities, and miscellaneous station expenses 
 Partner direct charges —aircraft fuel, landing fees, on-board catering, and ownership of certain aircraft 
 

 (1) The Company and Delta Air Lines may terminate the Delta CPAs for material breach of contract and significant declines in operating performance, among others, after satisfying applicable notice and cure periods. 
 United Airlines 
 The Company entered into a CPA with United Airlines during the year ended December 31, 2021, for the replacement of 38 E170 aircraft with new E175 aircraft for scheduled passenger service over a 12 -year term, including certain customary right-of-use aircraft leasing terms. The Company placed 34 aircraft into service since inception of the CPA. Additionally, the Company further repositioned 34 E170 aircraft from the United Airlines CPAs based on scheduled United Airlines CPA expiries during the years then ended. The remaining four aircraft are expected to be operating on the 
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 United Airlines CPAs during the year ending December 31, 2026, which includes one aircraft delivered during the year ended December 31, 2025, which had not yet commenced revenue service. 
 Further, on November 25, 2025, the Company entered into a new 10-year CPA with United Airlines and Mesa, to operate an additional 60 E175 aircraft owned by United Airlines and operated by Mesa Airlines, Inc. In relation to the Merger with Mesa, the Company received $ 49.0 million as a non-refundable upfront fee from United Airlines to cover expenses related to the Merger and is recognized in accounts payable and accrued and other liabilities-related parties and other non-current liabilities-related parties in the consolidated balance sheets as of December 31, 2025. The fee is being amortized ratably on a straight-line basis over the respective CPA term. 
 Key provisions of our CPAs, as amended, are summarized as follows: 
 
 United Airlines 
 
 Operational aircraft—December 31, 2025 126 
 
 Aircraft type E170/E175 
 
 Seating configuration 70 – 76 seats 
 
 
 Scheduled expiration (1)(2) 
 January 2026 – December 2037 
 
 
 Significant pass-through / Partner direct charges (3) 
 Pass-through —insurance, property taxes, certain planned major maintenance activities, and miscellaneous station expenses 
 Partner direct charges —aircraft fuel, landing fees, on-board catering, and ownership of certain aircraft 
 

 (1) United Airlines has a call option to assume our ownership or leasehold interests in certain aircraft (i) if the Company wrongfully terminates the capacity purchase relationship, (ii) if United Airlines terminates the agreements for the Company’s breach of contract, or (iii) at the election of United Airlines, subject to certain notice requirements and age and condition of call option aircraft. 
 (2) The United Airlines CPAs may be terminated by United upon providing 30 days’ written notice if, among other reasons, the Company fails to attain certain operating performance targets for a specified period, subject to a right to cure. The United CPAs may be terminated by United immediately upon written notice (without any prior notice), following the occurrence of a labor strike for ten or more consecutive days. 
 (3) United Airlines has the right to assume our Company’s responsibility to purchase any of the pass-through products and services. 
 Revenues by Partner Airline for the years ended December 31, 2025, 2024, and 2023 are disaggregated as follows: 
 
 (in millions) 
 2025 2024 2023 
 American Airlines 
 $ 723.6 $ 627.4 $ 659.0 
 Delta Air Lines 
 409.7 378.2 334.1 
 United Airlines 
 517.5 448.9 424.2 
 Other 
 25.7 19.5 11.8 
 Total revenues 
 $ 1,676.5 $ 1,474.0 $ 1,429.1 

 Revenues derived from the CPAs by type of revenue for the years ended December 31, 2025, 2024, and 2023 are disaggregated as follows: 
 
 (in millions) 
 2025 2024 2023 
 Regional jet service revenue 
 $ 1,346.4 $ 1,165.9 $ 1,111.6 
 Lease revenue (1) 
 304.4 288.6 305.7 
 Other revenue 
 25.7 19.5 11.8 
 Total revenues 
 $ 1,676.5 $ 1,474.0 $ 1,429.1 

 (1) Certain of the Company’s CPAs include embedded leases for the right-of-use of the regional jet aircraft. The Company also leases 31 aircraft not under CPAs to American Airlines. The corresponding rental income is classified herein. 
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 LIFT Academy recorded tuition revenue of $ 23.2 million, $ 19.3 million, and $ 11.6 million during the years ended December 31, 2025, 2024, and 2023, respectively. Tuition payments received from students are recognized as deferred revenue and reflected in accrued and other liabilities in the consolidated balance sheets and are recognized on a systematic basis as students progress throughout their respective training programs. 
 Amounts recognized as revenues in the consolidated statements of operations are subject to certain estimates, which could materially impact the timing and consideration determined under the contract. Such estimates include (i) expected contract terms from material modifications to the fixed-fee capacity purchase agreements which are expected to be made in the future and (ii) the extent to which disputes in contract interpretation arise. 
 Receivables and contract assets— Receivables represent a right to consideration for promised services which have been transferred to customers. The Company records provisions for credit losses using an expected credit losses model on the basis of specific identification and historical collection experience. For more information on credit losses, refer to Note 17, Valuation and Qualifying Accounts . 
 Contract assets are generated from the partial satisfaction of certain performance obligations, generally related to the delivery of aircraft maintenance services, under customer contracts whereby the Company has the right to consideration for services transferred or provided to its customers. Other current assets—related parties and other non-current assets—related parties in the consolidated balance sheets consist entirely of contract assets, which have been appropriately reduced for the applicable financing component. The Company expects to collect all current amounts within the next twelve months, while non-current amounts will be collected over the period from 2027 to 2030. 
 Contract liabilities— Contract liabilities consist of deferred revenues for which the Company has received customer payment for undelivered services. In addition, the Company periodically carries out capital projects on behalf of its Partner Airlines, generally pertaining to aircraft fleet and livery improvements. Revenues of this nature are recognized over time, depicting the pattern of transfer of control of services, resulting in ratable recognition of revenues over the remaining term of the CPA, ranging from 2026 - 2036. 
 Current and non-current deferred revenues are recorded to accounts payable and accrued and other liabilities-related parties and other non-current liabilities-related parties, respectively, in the consolidated balance sheets. The Company recognized $ 16.1 million, $ 13.7 million, and $ 10.8 million of the deferred revenue to revenues in the consolidated statements of operations during the years ended December 31, 2025, 2024, and 2023, respectively, which was previously included in contract liabilities at December 31, 2024, 2023, and 2022, respectively. Current contract liabilities were $ 35.9 million and $ 22.7 million as of December 31, 2025 and 2024, respectively. Non-current contract liabilities were $ 103.2 million and $ 41.8 million as of December 31, 2025 and 2024, respectively. 
 
 6. FAIR VALUE MEASUREMENTS 
 The Company holds certain financial instruments, which require measurement to fair value in accordance with ASC 820, Fair Value Measurement . The Company measures the following financial instruments on a recurring basis: 
 Cash, cash equivalents, and restricted cash —The carrying amounts of cash, cash equivalents, and restricted cash reported in the consolidated balance sheets are classified as a Level 1 fair value measurement in the ASC 820, Fair Value Measurement, fair value hierarchy. Amounts presented in the consolidated balance sheets approximate the respective fair values using a market valuation technique. 
 Marketable securities —Investments in marketable securities primarily include U.S. Treasury securities and are recorded at fair value. Valuation of securities is based on reference to the quoted market price on national exchanges, representing Level 1 fair value measurements as defined in ASC 820, Fair Value Measurement . Unrealized and realized gains and losses are recorded to investment income and other, net, in the consolidated statements of operations. Amounts recorded for unrealized and realized gains for the years ended December 31, 2025, 2024, and 2023 were $ 7.7 million, $ 10.6 million, and $ 5.5 million, respectively. 
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 EVE Investment —During the year ended December 31, 2022, the Company acquired 1,000,000 shares of Class A Common Stock in EVE for which Embraer S.A., a related party, through its wholly-owned subsidiary Embraer Aircraft Holdings, Inc., possesses beneficial ownership of EVE. Shares were acquired for a purchase price of $ 10.00 per share (“EVE Equities”) in furtherance of a commercial partnership among certain initial investors for the development of eVTOL aircraft. Additionally, as an inducement to enter into the partnership, the Company obtained (i) warrants for the acquisition of an additional 1,500,000 shares of Class A Common Stock in EVE at an exercise price of $ 0.01 per share, subject to a three year lock-up period, exercisable through May 2027 (the “EVE Warrants”) and (ii) a put option for reacquisition of EVE Class A Common Stock by EVE or a subsidiary of EVE for the aggregate put price of $ 10.0 million, exercisable on demand through May 2032 (the “Put Option”) (collectively with the EVE Equities, EVE Warrants, and the Put Option, the “EVE Investment”). The Put Option is redeemable in future aircraft parts and maintenance services. 
 The EVE Equities are subject to provisions of FASB ASC 321, Investments . The investment was initially measured at fair value and was recorded to other non-current assets in the consolidated balance sheets. EVE Equities represent a Level 1 investment within the FASB ASC 820, Fair Value Measurement, fair value hierarchy, as the inputs for shares of EVE common stock are observable and actively exchange-traded. As of December 31, 2025 and 2024, the Company recorded $ 4.0 million and $ 5.4 million, respectively, attributable to the fair value of EVE Equities to other non-current assets in the consolidated balance sheets. The Company recorded unrealized gains (losses) of ($ 1.5 ) million, ($ 1.9 ) million, and $ 0.1 million related to the EVE Equities to investment income and other, net, in the consolidated statements of operations during the years ended December 31, 2025, 2024, and 2023, respectively. 
 EVE Warrants and the Put Option issued in conjunction with the EVE Investment are characterized as financial instruments and manufacturer incentives, respectively, for redemption toward future eVTOL aircraft acquisitions, aircraft parts, and/or maintenance services for the regional jet aircraft. Financial instruments related to the EVE Warrants and Put Option are recorded to other non-current assets at the estimated fair value at issuance and subsequently adjusted to fair value at each reporting date. Manufacturer incentives are recorded to other non-current liabilities in the consolidated balance sheets. Incentives utilized for future aircraft and equipment purchases will be applied as a reduction to the aircraft basis upon delivery. 
 The Company recorded $ 17.5 million in manufacturer incentives to other non-current liabilities related to the EVE Warrants and Put Option, which was fixed at the consummation of the Eve Investment during the year ended December 31, 2022. During the years ended December 31, 2025, 2024, and 2023, the Company recorded unrealized gains (losses) of ($ 2.2 ) million, ($ 2.8 ) million, and $ 0.2 million related to fluctuations in fair value of the EVE Warrants, respectively. Fluctuations in fair value related to the Put Option were not material. As the EVE Warrants and Put Option are adjusted to fair value at each reporting period in accordance with FASB ASC 815, Derivatives and Hedging , and the related manufacturing incentive is fixed at issuance date in accordance with FASB ASC 705-20, Cost of Sales and Services – Accounting for Consideration , the Company will continue to record unrealized gains or losses associated with the change in fair value of the EVE Warrants and Put Option in earnings despite no economic loss to the Company based on the terms of the EVE agreements and economic substance of the aggregate EVE Investment. 
 The Company estimates the fair value of EVE Warrants and the Put Option using a Black-Scholes option pricing model. This market-based approach relies on the use of significant unobservable inputs, and therefore, such amounts are classified as Level 3 fair value measurements within the ASC 820, Fair Value Measurement , fair value hierarchy. The significant unobservable input used in the Black-Scholes option pricing model in the valuation of the EVE Investments is the implied volatility using the comparison of stock prices of comparative eVTOL companies of similar size. 
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 The Company measures the following assets and liabilities at fair value on a recurring basis: 
 
 As of December 31, 2025 
 (in millions) 
 Recorded 
 Balance 
 Level 1 
 Level 2 
 Level 3 
 
 Cash, cash equivalents, and restricted cash 
 
 $ 157.7 
 $ 157.7 
 $ — 
 $ — 
 Marketable securities 
 
 162.2 
 162.2 
 — 
 — 
 EVE Investment 
 
 15.4 
 4.0 
 — 
 11.4 
 Total 
 
 $ 335.3 
 $ 323.9 
 $ — 
 $ 11.4 

 
 As of December 31, 2024 
 (in millions) Recorded 
 Balance 
 Level 1 Level 2 
 Level 3 
 
 Cash, cash equivalents, and restricted cash 
 
 $ 131.9 
 $ 131.9 
 $ — 
 $ — 
 Marketable securities 
 
 191.5 
 191.5 
 — 
 — 
 EVE Investment 
 
 18.7 
 5.4 
 — 
 13.3 
 U.S. Treasury Warrants 
 
 ( 6.8 ) 
 — 
 — 
 ( 6.8 ) 
 Total 
 $ 335.3 
 $ 328.8 
 $ — 
 $ 6.5 

 As of December 31, 2024, U.S. Treasury Warrants were classified as liability awards and were recognized at fair value and adjusted at each reporting date thereafter using the Black-Scholes option pricing model using an implied volatility calculated by the comparison of stock prices of select airlines of similar size and/or an income approach to determine fair value of the equity of the Company, reporting a Level 3 fair value measurement as defined in the ASC 820, Fair Value Measurement fair value hierarchy. 
 In conjunction with the Merger closing, the U.S. Treasury Warrants were reclassified from liability awards to equity awards based on the underlying characteristics of the warrants and manner of future settlement of the awards. The Company reclassified $ 7.4 million for the U.S. Treasury Warrants from accrued expenses in the consolidated balance sheets to additional paid-in-capital in the consolidated balance sheets and discontinued measurement of the U.S. Treasury Warrants to fair value at each reporting date. The carrying value of the U.S. Treasury Warrants was $ 7.4 million as of December 31, 2025. 
 The Company recorded unrealized gains (losses) of $( 1.7 ) million, $ 0.2 million, and $( 1.2 ) million to investment income and other, net in the consolidated statements of operations related to fair value adjustments of the U.S. Treasury Warrants for the years ended December 31, 2025, 2024, and 2023, respectively. 
 During the year ended December 31, 2025, the U.S. Treasury exercised 315,534 of their existing Warrants for $ 1.1 million in cash. Remaining U.S. Treasury Warrants outstanding as of December 31, 2025 were 691,701 , exercisable through July 15, 2026. 
 On January 30, 2026, the Company adopted the Omnibus Amendment with the U.S. Treasury to settle the outstanding U.S. Treasury Warrants as of December 31, 2025 in cash. The U.S. Treasury Warrants were settled on February 18, 2026 totaling $ 5.3 million. As of February 18, 2026, the Company has no remaining warrants outstanding. 
 The implied volatility, which is the unobservable input, used in the determination of fair value of Level 3 investments for the years ended December 31, 2025 and 2024 is as follows: 
 
 2025 2024 
 EVE Investment 
 61.6 % 72.1 % 

 The increase or decrease in the fair value measurement of the implied volatility may result in a higher or lower effect on the fair value measurement of the Company’s EVE Investment. The amount recorded to other non-current assets as of December 31, 2025 and 2024 for the aggregate EVE Warrants and the Put Option was $ 11.4 million and $ 13.3 million, respe ctively. 
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 The reconciliation of Level 3 fair value measurements during the years ended December 31, 2025 and 2024 are as follows: 
 
 (in millions) 
 
 Balance at December 31, 2023 $ 8.9 
 Change in fair value of Eve Investment (unrealized) ( 2.6 ) 
 Change in fair value of U.S. Treasury Warrants (unrealized) 0.2 
 Balance at December 31, 2024 6.5 
 Change in fair value of Eve Investment (unrealized) ( 1.9 ) 
 Change in fair value of U.S. Treasury Warrants (unrealized) ( 1.7 ) 
 U.S. Treasury Warrants exercised 1.1 
 U.S. Treasury Warrants converted to equity 
 
 7.4 
 Balance at December 31, 2025 $ 11.4 

 During the year ended December 31, 2023, the Company remeasured the value of its investment in Cape Air on a non-recurring basis for declines in value which may be other than temporary. The Company valued the investment in Cape Air under the discounted cash flow method. Therefore, it is considered a Level 3 fair value measurement under ASC 820, Fair Value Measurement . In response, the Company recorded a $ 3.6 million reduction in value to investment income and other, net in the consolidated statement of operations which will be subsequently amortized over the useful life of Cape Air aircraft of 15 years in accordance with ASC 323, Investments—Equity Method Investments & Joint Ventures . 
 Market risk associated with our fixed-rate debt primarily relates to the potential change in fair value and impact to future earnings, respectively, from a change in prevailing market interest rates. Within the fair value hierarchy, the fair value of debt is based predominantly on a market approach, looking to recently completed market transactions and estimates based on interest rates, maturities, credit risk, and underlying collateral. These inputs are classified as Level 3 fair value measurements within the fair value hierarchy. The fair value of debt, including current maturities and excluding finance leases, exceeded its carrying value by $ 10.8 million as of December 31, 2025. The carrying value of long-term debt exceeded its fair value by $ 11.5 million as of December 31, 2024. 
 
 7. LEASES 
 The Company routinely enters into operating and finance leases as a financing method for aircraft, spare engines, flight training equipment, and operating facilities. The Company records a lease asset and corresponding liability for leases with terms exceeding 12 months. Such assets and liabilities are measured at the present value of remaining lease payments at the commencement of the lease or consummation of a lease modification. 
 Lease terms give effect to early termination and renewal options wh en it is reasonably certain that such options will be exercised. The Company determines present value, discounting payment streams at the interest rate implicit in the lease, when available, taking into consideration economic escalation provisions, when applicable. When this information is unknown, the Company estimates its incremental borrowing rate at the related lease commencement date, which is derived from prevailing market interest rates, recent debt acquisitions specific to the Company, or other debt instruments having similar characteristics at lease commencement. With the exception of the CPAs and operating facilities, the Company does not separate lease and non-lease contractual components. Provisions for residual value guarantees are not material. 
 As part of the Merger, the Company acquired leases, three of which are classified as operating in the consolidated balance sheets as of December 31, 2025. The Company measured the operating lease liabilities at present value of the remaining lease payments on the Merger date in accordance with ASC 805, Business Combinations . Further, the Company measured the right-of-use asset in exchange for the operating lease liabilities assumed and adjusted for comparable market terms on the Merger date. As a result, such leases increased operating right-of-use assets and operating lease liabilities by $ 7.1 million and $ 6.7 million, respectively. The Company elected to not recognize assets or liabilities with remaining terms of 12 months or less as a practical expedient permitted under ASC 805, Business Combinations . Refer to Note 3, Merger with Mesa Air Group Inc. , for more information. 
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 Aircraft and engines— As of December 31, 2025, the Company is party to non-cancelable operating and financing lease agreements related to 23 aircraft and 13 spare engines with varying terms extending through 2031 . Of the 23 leased aircraft and 13 leased engines, 12 and nine are leased directly from Partner Airlines (“Partner Controlled Aircraft”), respectively, constituting related party lease obligations. See Note 16, Related Party Transactions . Lease terms generally coincide with the related CPA expiry. 
 Operating facilities— The Company’s leased operating facilities include airport terminal space, hangars and maintenance facilities, office space, and training facilities with initial terms extending from 30 days to 13 years , c lassified as operating leases and short-term leases. Airport terminal space, which includes crew rooms and line maintenance facilities, is generally leased directly from a governmental agency or authority. Rental rates are dependent on actual airport operating costs and require adjustment at least annually. As a result of the variable nature of rent, airport terminal space leases are not recorded to the operating lease right-of-use asset and operating lease liabilities. 
 Flight training equipment— The Company maintains a long-term supply agreement for fulfillment of full motion flight simulation equipment at a guaranteed minimum level through 2033 with additional capacity availability accounted for as operating leases. Pursuant to this arrangement, the Company leases training equipment, embedded with related maintenance service agreements. The Company has elected th e practical expedient permissible under ASC 842, Leases , and as a result, the non-lease service component has not been separated and removed from the operating lease right-of-use assets and related operating lease liabilities. 
 Components of lease costs for the years ended December 31, 2025, 2024 and 2023 are as follows: 
 
 (in millions) 
 2025 2024 2023 
 Operating lease cost 
 $ 21.4 $ 24.5 $ 29.3 
 Finance lease cost 
 Amortization of leased assets 5.8 
 8.3 
 12.6 
 Interest on lease liabilities 
 3.8 4.4 4.7 
 Variable and short-term lease cost 
 4.2 2.8 2.8 
 Total lease cost 
 $ 35.2 $ 40.0 $ 49.4 

 Operating lease cost, including variable and short-term lease cost, is recorded to aircraft and engine rent and other expense in the consolidated statements of operations. Finance lease cost is recorded to depreciation and amortization expense and interest expense in the consolidated statements of operations. 
 Supplemental balance sheet information related to leased assets and liabilities are as follows as of December 31 : 
 
 (in millions) 
 2025 2024 
 Assets: 
 
 Operating lease right-of-use assets 
 $ 131.7 $ 122.9 
 Property and equipment, net 
 54.3 70.4 
 Total lease assets 
 $ 186.0 $ 193.3 
 Liabilities: 
 
 Current 
 
 Current operating lease liabilities 
 $ 16.5 $ 13.5 
 Current finance lease liabilities 
 6.1 7.2 
 Non-current 
 
 Non-current operating lease liabilities 123.9 117.6 
 Non-current finance lease liabilities 
 53.4 59.5 
 Total lease liabilities 
 $ 199.9 $ 197.8 

 Operating leases —Lease obligations expected to be paid within 12 months represent current maturities and are classified within the current portion of operating lease liabilities to the consolidated balance sheets. Lease obligations with 
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 expected repayments extending beyond 12 months are recorded to operating lease liabilities— less current portion in the consolidated balance sheets. 
 Finance leases —The Company records finance lease assets, current liabilities, and non-current liabilities to property and equipment, net, current portion of long-term debt and finance leases, and long-term debt and finance leases—less current portion, respectively, in the consolidated balance sheets. Amortization of the finance lease asset is recorded to depreciation and amortization expense and the interest component of the lease payment is recorded to interest expense in the consolidated statements of operations. 
 Additional lease terms are as follows for the years ended December 31, 2025 and 2024 : 
 
 2025 2024 
 Weighted average remaining lease term (in years): 
 Operating leases 
 7.3 8.0 
 Finance leases 
 5.3 6.2 
 Weighted average discount rate: 
 Operating leases 
 6.1 % 5.8 % 
 Finance leases 
 6.0 6.0 

 Maturities of lease liabilities are as follows as of December 31, 2025 and thereafter: 
 
 (in millions) 
 Operating Leases 
 Finance Leases 
 Total 
 
 2026 $ 24.5 $ 9.5 $ 34.0 
 2027 24.9 9.5 34.4 
 2028 23.3 9.5 32.8 
 2029 22.6 9.5 32.1 
 2030 21.3 30.0 51.3 
 Thereafter 
 59.4 4.6 64.0 
 Total minimum lease payments 
 176.0 72.6 248.6 
 Less imputed interest component 
 ( 35.6 ) ( 13.1 ) ( 48.7 ) 
 Total lease obligations 
 140.4 59.5 199.9 
 Less current obligations 
 ( 16.5 ) ( 6.1 ) ( 22.6 ) 
 Long-term lease obligations 
 $ 123.9 $ 53.4 $ 177.3 

 Supplemental cash flow and other information related to leases are as follows: 
 
 Year Ended December 31, 
 (in millions) 2025 2024 2023 
 Cash Transactions: 
 
 Operating cash flows used in operating leases 
 
 $ ( 20.5 ) 
 $ ( 23.5 ) 
 $ ( 28.0 ) 
 Operating cash flows used in financing leases 
 
 ( 3.8 ) 
 ( 4.4 ) 
 ( 4.7 ) 
 Financing cash flows used in financing leases 
 
 ( 11.0 ) 
 ( 15.3 ) 
 ( 14.8 ) 
 Non-cash transactions: 
 
 Operating leases converted to finance leases 
 
 — 
 — 
 5.8 
 ROU assets acquired in connection with the Merger 
 7.1 
 — 
 — 
 ROU assets acquired in exchange for operating lease obligations 
 
 15.8 
 8.7 
 32.9 
 ROU assets acquired in exchange for financing lease obligations 
 
 — 
 — 
 0.4 

 Aircraft leasing arrangements —The Company’s CPAs include provisions for the right-to-use of the Company’s aircraft in carrying out regional jet services. Such provisions constitute embedded leases for which the Company receives reimbursement for aircraft ownership costs, as Partner Airlines obtain substantially all of the economic benefit from the 
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 aircraft under operation for the Partner Airlines. Aircraft lease terms are commensurate with CPA terms discusse d at Note 5, Revenue Recognition. The Company mitigates the risk from residual and undeployed leased assets in the event of default of one of our Partner Airlines by actively monitoring aircraft and engine financing terms compared to market terms in order to effectively sell or redeploy aircraft to the extent they become unused or underutilized, which additionally decreases with the extent to which the Company operates Partner Controlled Aircraft. 
 Rental revenue from operating leases for each of the next five years and total of the remaining years as of December 31, 2025 are as follows: 
 
 (in millions) Revenue Recognition 
 2026 
 $ 288.5 
 2027 
 282.5 
 2028 
 253.2 
 2029 
 227.6 
 2030 
 143.8 
 Thereafter 498.3 
 Total $ 1,693.9 

 
 8. PROPERTY AND EQUIPMENT 
 Property and equipment consisted of the following as of December 31, 2025 and 2024: 
 
 (in millions) 2025 2024 
 Aircraft 
 
 $ 3,206.6 
 $ 2,898.7 
 Engines and flight equipment 
 
 300.4 
 243.4 
 Land and buildings 
 
 211.3 
 158.9 
 Office equipment and leasehold improvements 
 
 75.0 
 67.2 
 Total property and equipment 
 
 3,793.3 
 3,368.2 
 Less accumulated depreciation and amortization 
 
 ( 1,383.3 ) 
 ( 1,258.7 ) 
 Property and equipment, net 
 
 $ 2,410.0 
 $ 2,109.5 

 The Company recorded depreciation and amortization expense of $ 126.3 million, $ 117.0 million, and $ 159.4 million for the years ended December 31, 2025, 2024, and 2023, respectively. 
 
 9. ACCRUED AND OTHER LIABILITIES 
 Accrued and other liabilities that are not with a related party consisted of the following as of December 31, 2025 and 2024 : 
 
 (in millions) 
 2025 2024 
 Accrued wages, benefits, and related taxes 
 
 $ 112.2 
 $ 82.4 
 Accrued maintenance 
 
 68.4 
 39.9 
 Deferred revenue and contract liabilities 
 
 4.5 
 16.8 
 Other 
 
 34.7 
 29.8 
 Total 
 
 $ 219.8 
 $ 168.9 

 
 10. DEBT 
 As of December 31, 2025 , total indebtedness, net of debt discounts, premiums and issuance costs, consisted of (i) secured financing arrangements for security interests in aircraft and spare engines (“Aircraft and Engine Debt”), pass-through trust certificates secured by aircraft spare parts (“Equipment Debt”), and corporate real estate properties (“Real Estate Debt”); (ii) U.S. Treasury loan programs (“PSP Loans”); and (iii) finance leases. Amounts expected to be repaid 
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 within 12 months are classified within the current portion of long-term debt and finance leases in the consolidated balance sheets. Balances at December 31, 2025 and 2024 are as follows: 
 
 (in millions) 
 Maturity Date(s) 
 Interest Rates (3) 
 2025 2024 
 Secured financing facilities (1) 
 
 Aircraft and Engine Debt (2) 
 2026 – 2037 
 1.9 % – 10.2 % 
 $ 833.6 $ 747.6 
 Real Estate Debt 2026 8.0 % 49.3 50.5 
 Equipment Debt 2028 8.0 % 103.3 109.2 
 PSP Loans 
 2030 – 2031 
 6.4 % 49.2 49.2 
 Finance leases (See Note 7) 
 59.5 66.7 
 Total debt and finance leases 
 1,094.9 1,023.2 
 Less: unamortized debt discounts and debt issuance costs 
 ( 10.0 ) ( 11.4 ) 
 Less: current portion of long-term debt and finance leases 
 ( 202.0 ) ( 259.6 ) 
 Long-term debt and finance leases—less current portion 
 $ 882.9 $ 752.2 

 (1) The net book value of the underlying security interests is $ 1,701.3 million and $ 1,791.8 million as of December 31, 2025, and 2024, respectively, consisting of inventories, corporate properties, and property and equipment, net. 
 (2) Financing arrangements include fixed and variable rate debt. All of the variable rate instruments are measured at an equivalent to the Secured Overnight Financing Rate (“SOFR”), plus a specified margin. 
 (3) As of December 31, 2025. 
 Aircraft and Engine Debt —Financing arrangements are in exchange for security interests in first liens on the underlying aircraft and certain spare engines. Repayment obligations may be accelerated at the Company’s option, subject to customary early termination provisions . 
 During the year ended December 31, 2025, the Company obtained aggregate borrowings of $ 299.4 million consisting of new aircraft debt of $ 255.5 million secured by 12 factory new E175 aircraft, $ 1.2 million collateralized general aviation aircraft, and $ 42.7 million secured by a complement of spare engines. Payments on aggregate borrowings obtained are due in quarterly installments with terms ranging from five to 12 years. 
 During the year ended December 31, 2024, the Company obtained aggregate borrowings of $ 177.3 million consisting of new aircraft debt of $ 126.2 million secured by six factory new E175 aircraft and $ 51.1 million collateralized or re-collateralized by a complement of regional and general aviation aircraft. Payments on aggregate borrowings obtained are due in quarterly installments with terms ranging from four to 12 years. Additionally, during the year ended December 31, 2024, the Company made early debt extinguishments of $ 37.4 million in secured aircraft loans, plus accrued and unpaid interest expense related to the sale and disposition of the underlying aircraft. 
 Real Estate Debt —During the year ended December 31, 2023, the Company entered into a loan agreement for aggregate borrowings of $ 52.0 million which is collateralized by a portion of the Company’s new flight training campus and corporate headquarters in Carmel, Indiana (the “Aviation Campus”). Borrowings under the loan agreement bear interest at SOFR plus a stated margin with scheduled maturities through 2025. During the year ended December 31, 2025, the Company executed a one-year extension to the scheduled maturity through the year ending December 31, 2026 and has the option to extend for two additional one year terms. Repayment obligations may be accelerated at the Company’s option without penalty. 
 Equipment Debt —During the year ended December 31, 2023, the Company formed a pass-through trust for the sale of Class A Certificates (“Enhanced Equipment Trust Certificates” or “EETC”). The trust, in turn, gave effect to the sale of Series A Equipment Notes secured by certain of the Company’s spare aircraft equipment, generating aggregate proceeds of $ 118.0 million for general corporate purposes. Repayment of the Series A Equipment Notes occurs on a 
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 specified maturity schedule through 2028 with regularly scheduled interest payments at 8.0 % per annum. Repayment obligations may be accelerated at the Company’s option, subject to customary early termination provisions. 
 The Company evaluated whether the pass-through trust formed for administration of Equipment Debt is a variable interest entity (“VIE”) requiring potential consolidation within the consolidated financial statements. Although the pass-through trust constitutes a VIE, the Company is not the primary beneficiary of the trust and therefore it is not presented within these consolidated financial statements. 
 The Series A Equipment Notes include customary financial covenants pursuant to which the Company must maintain a certain loan-to-value ratio of the regularly appraised value of underlying spare parts. 
 Payroll Support Program Loans —The Payroll Support Program (“PSP”) loans are unsecured borrowings with scheduled maturities of the total outstanding principal obligation at the ten-yea r anniversary of each initial draw (“PSP Loan Term”). PSP Loans bear interest at an indexed rate plus 2.0 %, payable on a quarterly basis over the PSP Loan Term. Voluntary pre-payment is permi ssible at any time without penalty. 
 Our credit agreements require that we comply with customary affirmative and negative covenants. Management believes the Company is in compliance with all of its financial covenants as of December 31, 2025 and 2024. 
 As of December 31, 2025 and 2024 , the Company had 100 % cash collateralized letter of credit facilities of $ 22.8 million and $ 21.4 million, respectively. Amounts are recorded in restricted cash in the consolidated balance sheets. 
 Aggregate principal maturities as of December 31, excluding finance leases, are as follows (in millions): 
 
 Year 
 Total 
 
 2026 $ 196.0 
 2027 120.2 
 2028 172.3 
 2029 76.0 
 2030 110.4 
 Thereafter 350.5 
 Total $ 1,025.4 

 Substantially all debt obligations held by subsidiaries of the Company are guaranteed for timely payment and performance by the Parent. 
 
 11. INCOME TAXES 
 The components of income tax expense for the years ended December 31, are as follows: 
 
 (in millions) 
 2025 2024 2023 
 Federal: 
 
 
 
 
 Deferred 
 
 $ 43.7 
 $ 18.8 
 $ 19.5 
 Total Federal 
 
 $ 43.7 
 $ 18.8 
 $ 19.5 
 
 
 
 
 
 State: 
 
 
 
 
 
 
 
 Current 
 
 $ 3.3 
 $ 5.1 
 $ 3.8 
 Deferred 
 
 4.5 
 2.0 
 13.6 
 Total State 
 
 7.8 
 7.1 
 17.4 
 Change in valuation allowance 
 
 ( 12.4 ) 
 ( 2.1 ) 
 ( 3.4 ) 
 Benefit for uncertain tax positions 
 
 ( 1.9 ) 
 ( 1.5 ) 
 ( 0.3 ) 
 Income tax expense 
 
 $ 37.2 
 $ 22.3 
 $ 33.2 

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 A reconciliation of income tax expense at the applicable federal statutory income tax rate of 21.0% to the tax provision as reported for the years ended December 31 is as follows. As a result of adopting ASU 2023-09, the disaggregated components for the years ended December 31, 2024 and 2023 were recast to conform with the presentation of the 2025 year. 
 
 (in millions) 2025 2024 2023 
 $ % $ % $ % 
 US federal statutory rate $ 23.8 21.0 $ 18.2 21.0 $ 18.5 21.0 
 State and local income tax, net of federal effect (1) 
 5.5 5.0 5.0 5.7 14.7 16.7 
 Changes in valuation allowances 
 ( 10.0 ) ( 8.8 ) — — ( 0.6 ) ( 0.7 ) 
 Changes in uncertain tax positions 
 ( 1.9 ) ( 1.7 ) ( 1.5 ) ( 1.7 ) ( 0.3 ) ( 0.3 ) 
 Nontaxable or nondeductible items, net: 
 
 Meals and entertainment disallowance 
 1.3 1.1 1.2 1.4 1.1 1.2 
 Limit on executive compensation 3.8 3.4 — — — — 
 Excess tax benefits from share based compensation ( 1.2 ) ( 1.1 ) — — — — 
 Transaction costs 3.0 2.6 — — — — 
 Other ( 0.2 ) ( 0.2 ) ( 0.6 ) ( 0.7 ) ( 0.2 ) ( 0.2 ) 
 Other adjustments to deferred items 
 Temporary differences - 162(m) 3.1 2.7 — — — — 
 Tax attributes - Net Operating Loss (“NOL”) expiration 
 10.0 8.8 — — — — 
 Effective tax rate 
 $ 37.2 32.8 $ 22.3 25.7 $ 33.2 37.7 

 (1) The state and local jurisdictions that contribute to the majority (greater than 50%) of the tax effect in this category are Massachusetts, New York City, New York State, and Virginia for each of the three years ended December 31, 2025, 2024, and 2023. 
 Deferred income tax assets (liabilities) as of December 31 are comprised of the following: 
 
 (in millions) 
 2025 2024 2023 
 DEFERRED TAX ASSETS: 
 
 
 
 
 Federal and state NOL carryforwards, net of liability for uncertain tax positions 
 
 $ 125.8 
 $ 90.2 
 $ 123.7 
 Nondeductible accrual amounts 
 
 9.6 
 8.1 
 5.9 
 Accrued compensation 
 19.3 
 19.9 
 18.5 
 Deferred revenue and contract liabilities 
 34.2 
 15.1 
 7.4 
 Operating lease liabilities 
 34.7 
 32.4 
 34.4 
 Interest expense carryforward 
 17.1 
 — 
 — 
 Other 
 3.5 
 1.8 
 — 
 Total deferred tax assets 
 
 244.2 
 167.5 
 189.9 
 Valuation allowance (1) 
 
 ( 82.7 ) 
 ( 36.4 ) 
 ( 38.5 ) 
 Total deferred tax assets, net of valuation allowance 
 
 161.5 
 131.1 
 151.4 
 
 DEFERRED TAX LIABILITIES: 
 
 
 
 
 Accelerated depreciation and fixed asset basis differences for tax purposes 
 
 ( 349.7 ) 
 ( 306.7 ) 
 ( 307.5 ) 
 Right-of-use assets 
 
 ( 32.7 ) 
 ( 30.4 ) 
 ( 32.7 ) 
 Total deferred tax liabilities 
 
 ( 382.4 ) 
 ( 337.1 ) 
 ( 340.2 ) 
 Total net deferred tax liabilities 
 
 $ ( 220.9 ) 
 $ ( 206.0 ) 
 $ ( 188.8 ) 

 (1) Change in valuation allowance includes the Mesa valuation allowance as of the Merger closing date, which does not impact provision for income tax expense. 
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 The Company’s deferred tax assets were generated as a result of temporary differences between deductibility of reserves, accruals, and operating lease liabilities and recognition of revenue for the determination of income on a tax basis versus a U.S. GAAP basis combined with significant NOLs. Deferred tax liabilities relate predominantly to differences in U.S. GAAP and tax basis of aircraft and equipment and the related right of use assets created as the present value of remaining lease payments at the measurement date. The Company accelerates depreciation for tax reporting purposes for new aircraft and equipment deliveries. 
 The Company monitors ongoing tax cases related to its unrecognized tax benefits. The unrecognized tax benefits, which if recognized, would impact the effective tax rate. As of December 31, 2025 the Company has reversed all liabilities related to unrecognized tax benefits due to the expiration of the statute of limitations. 
 The following table reconciles the Company’s tax liability for uncertain tax positions for the years ended December 31 as follows: 
 
 (in millions) 
 2025 2024 2023 
 Balance at the beginning of the period 
 
 $ 1.9 
 $ 3.4 
 $ 3.5 
 Additions for tax positions taken in prior years 
 — 
 — 
 0.2 
 Reductions for tax positions due to expiration of statute of limitations 
 
 ( 1.9 ) 
 ( 1.5 ) 
 ( 0.3 ) 
 Balance at the end of the period 
 
 $ — 
 $ 1.9 
 $ 3.4 

 As of December 31, 2025, the Company has Federal NOL carryforwards totaling approximately $ 300 million, of which a portion begin expiring during 2036. Approximately $ 190 million of our Federal NOL carryforwards are not subject to expiration. These NOL carryovers are only available to offset 80% of taxable income in years in which they are utilized due to tax law changes as a result of the Tax Cuts and Jobs Act. The Company also has $ 70 million of interest expense carryovers as a result of 163(j) limitations as of December 31, 2025, which do not expire. Tax years beginning in 2007 through 2025 are currently subject to examination by the Internal Revenue Service. 
 The Company cannot conclude that it is more likely than not that the benefit from certain Federal and state NOL carryforwards will be realized. In recognition of this uncertainty, the Company has provided a valuation allowance of $ 82.7 million and $ 36.4 million as of December 31, 2025 and 2024, respectively, on the deferred tax assets related to these NOL carryforwards. If or when recognized, the tax benefits related to any reversal of the valuation allowance on deferred tax assets will be recognized as a reduction of income tax expense. 
 The following table reconciles the Company’s valuation allowance for the years ended December 31 as follows: 
 
 (in millions) 
 2025 2024 2023 
 Balance at the beginning of the period 
 
 $ 36.4 
 $ 38.5 
 $ 41.9 
 Reductions for expiration of NOLs previously reserved 
 ( 10.0 ) 
 — 
 — 
 Additional allowance recorded in the Merger 
 58.7 
 — 
 — 
 Reductions for current year change in estimates 
 
 ( 2.4 ) 
 ( 2.1 ) 
 ( 3.4 ) 
 Balance at the end of the period 
 
 $ 82.7 
 $ 36.4 
 $ 38.5 

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 Income taxes paid (net of refunds) for tax years ended December 31 by jurisdiction (in millions): 
 
 (in millions) 2025 2024 2023 
 US Federal $ — 
 $ — 
 $ — 
 State and Local 2.8 
 5.7 
 3.3 
 New York City 1.7 
 2.5 
 2.1 
 New York State 0.9 
 1.0 
 0.1 
 Massachusetts 0.3 
 1.4 
 0.8 
 Pennsylvania 
 0.3 
 0.2 
 — 
 New Jersey 
 — 
 0.2 
 0.3 
 Tennessee 
 — 
 0.3 
 — 
 Indiana 
 ( 0.7 ) 
 — 
 — 
 Other 
 0.3 
 0.1 
 — 
 Total income taxes paid, net of refunds 
 $ 2.8 
 $ 5.7 
 $ 3.3 

 
 12. COMMITMENTS 
 The Company’s long-term commitments primarily include lease obligations (see Note 7, Leases ), long-term maintenance agreements, and purchase commitments, among others. 
 Long-term maintenance —The Company has long-term agreements relating to maintenance costs associated with engines, auxiliary power units (“APUs ” ), avionics , and other flight equipment. The following agreements comprise the Company’s long-term maintenance agreements for various airframe and engine components as of December 31, 2025 : 
 
 Maintenance Agreement 
 Termination 
 APUs 
 December 2034 
 Avionics 
 December 2029 
 Engines 
 December 2037 
 Wheels and Brakes 
 September 2030 

 Certain fixed agreements include a guaranteed minimum payment amount based on flight hours, departures, or other measures. Aggregate payments under long-term maintenance agreements were $ 154.0 million, $ 149.4 million, and $ 150.8 million for the years ended December 31, 2025, 2024 and 2023, respectively. 
 Purchase commitments —From time to time, the Company enters into purchase commitments for future aircraft and engine deliveries. The Company regularly makes pre-delivery deposit payments (“PDPs ” ) to support aircraft and engines on order. PDPs are retained and applied against the historical cost of the corresponding aircraft or engine at the time of its acquisition or expensed when deposit amounts are no longer expected to be returned from the manufacturer. Interest costs associated with PDPs are capitalized as a portion of the overall historical cost of the related aircraft or engine and are depreciated over the estimated useful life of the asset. The Company recorded $ 2.1 million and $ 1.6 million, respectively, in capitalized interest costs to property and equipment, net, in the consolidated balance sheets as of December 31, 2025 and 2024, respectively. 
 Republic has an order for 29 Embraer regional jets (E175) with deliveries through 2029. 
 During the year ended December 31, 2025, the Company executed an amendment to an existing financing commitment to finance contractually scheduled aircraft deliveries during the year ending December 31, 2026, which provides future funding for a portion of the total aircraft cost. Committed future borrowings are expected to be secured by the related aircraft and funded upon each delivery. Additionally, the Company obtained commitments for a future credit facility secured by spared engines As of December 31, 2025, the remaining maximum borrowings allowable under the agreements is $ 115.6 million. 
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 In each of the three years ended December 31, 2025, 2024, and 2023, the Company completed certain milestones in the construction of the Aviation Campus. The Aviation Campus houses a training center that, once fully integrated with pre-Merger Mesa Airlines operations, will be used to perform substantially all of the Company’s training activities for pilots, flight attendants, maintenance technicians, and dispatchers and houses eight full motion simulators along with flat panel simulators, cabin trainers, and classrooms. Additionally, the Aviation Campus includes overnight accommodations used exclusively by the Company’s associates in training, our corporate headquarters (completed January 2026), and a parking garage. The Company additionally began construction on additional overnight accommodations, which is expected to be completed in 2026. As of December 31, 2025 and 2024 , the Company recorded $ 2.9 million and $ 1.3 million, respectively, in capitalized interest costs to property and equipment, net, in the consolidated balance sheets associated with the construction of the Aviation Campus. 
 The following table displays the Company’s future contractual obligations for property and equipment under firm orders: 
 
 Payments Due By Period 
 (in millions) 
 2026 2027 2028 2029 Thereafter 
 Total 
 
 Aircraft and other equipment under purchase obligations 
 
 
 $ 83.5 
 $ 245.1 
 $ 385.2 
 $ 123.3 
 $ — 
 $ 837.1 
 Aviation Campus 
 
 
 28.3 
 — 
 — 
 — 
 — 
 28.3 

 Guarantees —Republic Airways has guaranteed certain obligations of LIFT Academy and certain third parties related to LIFT Academy operations . Expected losses from guaranteed obligations are derived from total commitments outstanding to third parties coupled with the probability of repayment and are recorded to accrued and other liabilities and other non-current liabilities in the consolidated balance sheets and other operating expense in the consolidated statements of operations. Total guaranteed obligations as of December 31, 2025 and 2024 were $ 21.1 million and $ 20.2 million, respectively. Losses expected to be incurred from guaranteed obligations were $ 7.3 million and $ 6.9 million as of December 31, 2025 and 2024 , respectively. 
 
 13. CONTINGENCIES 
 General indemnifications —The Company is a party to aircraft lease and financing arrangements, which include provisions requiring the Company to indemnify the lessor or financing party against certain losses which may arise from use of the related aircraft and equipment, including losses arising from tax consequences. The Company expects that such losses would constitute insurable losses and would therefore be subject to insurance coverage. Losses expected to arise from indemnities cannot be reasonably determined due to the uncertainty surrounding circumstances which may give rise to losses, or the amount of expected losses which could arise. 
 Legal matters —The Company is involved in various legal actions considered routine to the ordinary course of business. Contingent losses expected to arise as a result of pending legal matters, which could include expected future settlements, judgments, and legal fees are recorded when amounts become probable and are able to be estimated. Estimated future losses and legal fees related to ongoing litigation were not material as of December 31, 2025 and 2024. 
 While the Company cannot predict the outcome of these events with certainty, management does not believe pending legal matters would have a material effect on the results of operations, cash flows, or financial position. 
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 Employees under collective bargaining agreements —As of December 31, 2025, the Company employed approximately 8,400 employees. Of the Company’s total headcount, approximately 71 % of the employee base is represented by collective bargaining agreements as follows: 
 
 Employee Group 
 Represented 
 Employees 
 Union Group 
 
 Republic Airways Pilots 
 
 2,490 
 International Brotherhood of Teamsters (“IBT”), Local 357 
 Mesa Airlines Pilots 
 
 531 
 Air Line Pilots Association (“ALPA”), International 
 Republic Airways Flight Attendants 
 
 2,232 
 IBT, Local 135 
 Mesa Airlines Flight Attendants 
 
 567 
 The Association of Flight Attendants-CWA (“AFA”), AFL-CIO 
 Republic Airways Dispatchers 
 
 104 
 Transport Workers Union of America (“TWU”), Local 592 

 Collective bargaining agreements between the Company and each of IBT, Local 357; IBT, Local 135; Association of Flight Attendants and TWU, Local 592 become amendable during the year ending December 31, 2027. The CBA between Mesa Airlines and ALPA is currently amendable. 
 Although the Company has never had a work interruption or stoppage, the Company is subject to risks of work interruption or stoppage . Such conditions would materially impact the Company’s financial position, results of operations and cash flows, should they occur. 
 
 14. MEZZANINE EQUITY AND CAPITAL TRANSACTIONS 
 Common stock and RSUs of Legacy Republic have been retroactively restated to give effect to the Exchange Ratio set forth in the Merger Agreement. S ee Note 3, Merger with Mesa Air Group, Inc. 
 Stock Compensation 
 During the year ended December 31, 2020, the Company adopted the 2020 Omnibus Incentive Plan and issued RSUs to the Company’s Board of Directors. RSUs vested immediately with a contractual sale restriction until the earlier of the Merger closing or termination of the participant’s service to the Company’s Board of Directors. In the event a market did not exist for the RSUs, the agreement provided for certain put rights for the RSUs to be put to the Company at fair market value. The put rights required these RSUs to be classified in mezzanine equity. The amount presented in mezzanine equity in the consolidated balance sheet as of December 31, 2024 is based on the accumulated expense of the RSUs in accordance with ASC 718, Compensation—Stock Compensation . The Company issued 57,047 RSUs under the 2020 Omnibus Incentive Plan during the year ended December 31, 2025, at an estimated grant date fair value of $ 15.39 per share. No RSUs were issued during the year ended December 31, 2024. 
 Additionally, since 2020, the Company issued 482,542 RSUs to certain members of management of the Company (“Value and Performance RSUs”). The Value and Performance RSUs included a market condition that could decrease the number of units to be issued if the fair market value of the Company did not increase over 30 % by December 31, 2025. The Value and Performance RSUs also included a performance condition multiplier up to 300 % of the units issued based on the occurrence of a liquidity event as determined by the Company’s Board of Directors and an increase in the fair market value of the Company as of a liquidity event date. The performance condition was not probable to occur as December 31, 2024, and therefore no expense was recognized related to the performance condition during the year then ended. 
 Prior to closing of the Merger, the Value and Performance RSU agreements provided certain put rights for the units to be put to the Company at fair market value. Such provisions required that these Value and Performance RSUs were classified in mezzanine equity. The Company recorded share based compensation for these awards at the grant date fair value of $ 7.50 per share, which was determined using a Monte Carlo simulation model considering the market condition but not including the performance condition as it was not probable until closing of the Merger. The Value and Performance RSUs became fully vested on November 25, 2025 concurrent with closing of the Merger, which was a liquidity event as defined in the performance vesting conditions of the Value and Performance RSU awards. Upon closing, the remaining outstanding Value and Performance RSUs vested resulting in the issuance of 284,700 additional shares in satisfaction of 
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 the performance vesting condition. Amounts were reclassified from mezzanine equity to common stock and additional paid-in capital upon closing of the Merger as the Value and Performance RSUs were settled for common stock. 
 The Company recorded cumulative share based compensation expense related to the Value and Performance RSUs with performance-based vesting conditions during the year ended December 31, 2025, as well as the acceleration of the vesting of the award. The Company recorded $ 2.1 million and $ 0.8 million of share based compensation to executive separation and Merger-related items and wages and benefits expense in the consolidated statements of operations, respectively, related to these Value and Performance RSUs during the year ended December 31, 2025, including satisfaction of performance conditions. There is no unrecognized remaining compensation cost related to the Value and Performance RSUs as of December 31, 2025. 
 In addition, during the year ended December 31, 2025, the Company granted 191,769 RSUs (“Time Based Restricted Stock Awards”) to certain key members of management of the Company. The Time Based Restricted Stock Awards include a vesting condition and vest ratably each year over a three-year vesting period. The estimated grant date fair value of each Time Based Restricted Stock Award was $ 15.39 per share. During the year ended December 31, 2025, the Company recorded $ 1.1 million in share based compensation to wages and benefits expense in the consolidated statements of operations. As of December 31, 2025, the total unrecognized compensation cost related to these non-vested shares that the Company expects to recognize over a weighted average of approximately one year is $ 0.7 million. The Company accounts for forfeitures as they occur. 
 Also, during the year ended December 31, 2025, the Company granted 1,147,456 RSUs to certain key members of management, which are subject to both time- and performance-based vesting conditions (the “Republic Integration Awards”). The Republic Integration Awards and the Time Based Restricted Stock Awards, each, were unvested RSUs in Legacy Republic, which were automatically assumed and converted into the right to receive a restricted share award in respect of common stock of the Company. 
 The Republic Integration Awards subject to time-vesting conditions and vest in equal installments on the third and fourth anniversaries of closing of the Merger, subject to continued employment of the RSU holder. The Republic Integration Awards subject to performance-vesting conditions vest in one-third tranches upon achievement of specified operational milestones. During the year ended December 31, 2025, the Company recorded $ 5.1 million in share based compensation to wages and benefits expense in the consolidated statements of operations. As of December 31, 2025, the total unrecognized compensation cost related to these non-vested shares that the Company expects to recognize over a weighted average of approximately two years is $ 12.6 million. 
 In connection with Mr. Bedford’s retirement from the Company, effective July 1, 2025, 367,512 RSUs held by Mr. Bedford, previously classified as mezzanine equity, w ere modified, and an additional 284,963 RSUs were granted. All RSUs were considered earned and vested immediately. The recognition of Mr. Bedford’s awards resulted in $ 9.8 million of additional compensation expense during the year ended December 31, 2025 which was recorded to executive separation and Merger-related items in the consolidated statements of operations . 
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 The following table summarizes the activity of RSUs granted to certain employees of the Company for the years ended December 31, 2025, 2024, and 2023 : 
 
 Number of Shares 
 Weighted Average 
 Grant Date Fair Value 
 
 Unvested at December 31, 2022 826,658 $ 7.50 
 Forfeited 
 ( 36,069 ) 7.50 
 Unvested at December 31, 2023 790,589 7.50 
 Unvested at December 31, 2024 790,589 7.50 
 Granted 
 1,908,888 14.21 
 Vested ( 1,091,119 ) 9.84 
 Modified and Vested ( 367,512 ) 9.11 
 Forfeited 
 ( 15,597 ) 7.50 
 Unvested at December 31, 2025 
 1,225,249 15.39 

 
 15. DEFINED CONTRIBUTION PLANS 
 The Company sponsors defined contribution 401(k) plans (the “401(k) Plans”). The 401(k) Plans provide retirement savings alternatives to associates. In accordance with 401(k) Plan rules, associates may elect pre-tax deferrals, after-tax Roth deferrals, or a combination thereof, from eligible compensation. The Company matches up to 8.0 % of non-crew associates’ eligible compensation, and the related employer matching contributions are immediately vested. 
 Additionally, the Company maintains agreements with IBT, Local 357 and IBT, Local 135, representing the pilot and flight attendant labor groups, respectively. Under each CBA, the Company contributes up to a 12.0 % employer contribution and 8.0 % employer matching contribution over a five-year vesting period for pilots and flight attendants, respectively. In connection with the Merger, the Company retained defined contribution plans in place at Mesa Parent prior to Merger closing ( “ Legacy Mesa Plan”). The Legacy Mesa Plan matches 50.0 % of salary deferrals up to 10.0 % of eligible compensation over a four-year vesting period. The Company’s compensation expense related to 401(k) Plans and the Legacy Mesa Plan on an aggregate basis was $ 31.0 million, $ 28.6 million, and $ 27.7 million for the years ended December 31, 2025, 2024, and 2023 , respectively. 
 
 16. RELATED PARTY TRANSACTIONS 
 The Company’s related party transactions include transactions with our Partner Airlines and an original equipment manufacturer (the “Related Parties”), with whom we have held long-standing relationships. 
 The Company regularly transacts with its Related Parties as defined in ASC 850, Related Parties , in the ordinary course of business. Related party transactions are derived from passenger service under the capacity purchase relationships, certain aircraft leasing commitments between the Company and the Partner Airlines, and aircraft maintenance activities, which in turn, generate balances due to or due from our Related Parties. In addition, the Company generated deferred revenue balances from capital projects carried out on behalf of our Partner Airlines. Assets and liabilities expected to be realized within 12 months are classified as receivables — related parties and accounts payable and accrued and other liabilities — related parties, respectively, and other non-current assets — related parties and other non-current liabilities — related parties, respectively, for amounts expected to be realized thereafter. Substantially all of the Company’s revenues were derived from related parties during the years ended December 31, 2025, 2024, and 2023 . Operating expenses incurred relate to aircraft rent expense, interrupted trip expenses, maintenance expense, and employee benefits, among others. Management has concluded that transactions of this nature were carried out on an arm’s-length basis. 
 Risks and uncertainties —During the years ended December 31, 2025, 2024, and 2023 , substantially all of the Company’s revenues were derived from capacity purchase agreements with the Partner Airlines. Termination of any of these capacity purchase agreements could have a material adverse effect on the Company’s financial position, results of operations, and operating cash flows. 
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 Each of the Company’s Partner Airlines comprised the following receivables as of December 31, 2025 and 2024 and revenues for the years ended December 31, 2025, 2024, and 2023 : 
 
 Concentration base 
 American 
 Airlines 
 Delta Air 
 Lines 
 United 
 Airlines 
 
 Revenues for the year ended: 
 
 December 31, 2025 43 % 24 % 31 % 
 December 31, 2024 43 26 30 
 December 31, 2023 46 23 30 
 Receivables as of: 
 
 December 31, 2025 14 39 24 
 December 31, 2024 36 32 8 

 
 17. VALUATION AND QUALIFYING ACCOUNTS 
 Valuation and qualifying accounts are presented below: 
 
 Allowance for Credit Losses 
 
 Beginning Balance 
 Additions (1) 
 
 Cash Receipts (2) 
 
 Write-offs 
 Ending Balance 
 Year ended: 
 
 
 
 
 
 
 
 
 
 December 31, 2023 
 $ 0.3 
 $ 1.3 
 $ ( 0.3 ) 
 $ — 
 $ 1.3 
 December 31, 2024 
 1.3 
 1.0 
 ( 0.4 ) 
 ( 0.2 ) 
 1.7 
 December 31, 2025 
 1.7 
 1.4 
 ( 0.6 ) 
 — 
 2.5 

 (1) Charged to expense. 
 (2) Reduction of expense. 
 
 18. SUBSEQUENT EVENTS 
 In January 2026, the Company took delivery of one new E175 aircraft and obtained $ 21.4 million in borrowings secured by the aircraft with maturity in 2037, which entered into service in February. 
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 ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE 
 None.
REPUBLIC AIRWAYS HOLDINGS INC. 10-K

Item 8. Financial Statements and Supplementary Data
