Liquidity	9 Months Ended
Sep. 30, 2022
Text Block [Abstract]
Liquidity and Management's Plan, COVID-19	2. Liquidity The Company’s ability to meet its liquidity needs is dependent upon its cash, cash equivalents and marketable securities balances and its ability to generate cash flows from operations in the future in amounts sufficient to meet its obligations and repay its liabilities arising from normal business operations when they come due. The Company currently believes its available working capital and anticipated cash flows from operations will be sufficient to meet the Company’s liquidity requirements for at least the next 12 months from the date of this filing. However, there can be no assurance that the Company will be able to generate sufficient cash flows from operations, or that additional funds will be available, to meet its future liquidity needs, particularly if United fails to pay disputed amounts owed to Air Wisconsin pursuant to the United capacity purchase agreement or if the transition of Air Wisconsin’s aircraft to the American capacity purchase agreement is delayed or more difficult than currently anticipated. Reduced Block Hours Since the beginning of the COVID-19 pandemic, Air Wisconsin has experienced significantly reduced block hours relative to historical levels. The prevailing industry-wide pilot shortage, which is expected to continue for the foreseeable future, is currently the leading factor preventing Air Wisconsin from consistently achieving block hours in line with pre-pandemic levels. In addition, the United capacity purchase agreement is scheduled to terminate in February 2023, unless sooner terminated in accordance with its terms, in each case subject to a wind-down period following termination during which aircraft would be removed from service under the agreement in accordance with a schedule. Although a wind-down schedule has not yet been determined, the Company has estimated a wind-down schedule for purposes of its revenue calculations. The American capacity purchase agreement provides that a certain number of aircraft each month, commencing in March 2023, will begin flying scheduled flights for American. Before any Air Wisconsin aircraft can be available to operate flights for American, that aircraft must first be removed from service under the United capacity purchase agreement, painted to meet the livery requirements of the American capacity purchase agreement and otherwise modified to meet such requirements. During the period from the withdrawal of an aircraft from service under the United capacity purchase agreement until it is placed into service under the American capacity purchase agreement, that aircraft will not generate revenues from either United or American. The period of time that an aircraft will not be covered by either capacity purchase agreement depends on the wind-down schedule that has not been finally determined. The successful transition of aircraft from the United capacity purchase agreement to the American capacity purchase agreement is subject to many factors, some of which are not within Air Wisconsin’s control, including the level of cooperation from United and the timing for aircraft to meet the requirements of the American capacity purchase agreement. There can be no assurance that this transition will proceed smoothly, and unexpected delays in or costs associated with the transition could have a material adverse effect on the Company’s business, financial condition and results of operations. For additional information, refer to Part II, Item 5, “ American Capacity Purchase Agreement ” within this Quarterly Report. United Capacity Purchase Agreement The fixed amount Air Wisconsin is entitled to receive under the United capacity purchase agreement is based on a fixed contractual rate and number of covered aircraft, although there is currently a dispute with United as to the number of covered aircraft for which it is required to pay the fixed contractual rate. In October 2022, United initiated arbitration with respect to this dispute. Variable revenue may be earned based on the number of block hours and departures. Since the onset of the COVID-19 pandemic, variable revenues have been significantly reduced due to the lower number of flights relative to historical levels. However, the impact of the COVID-19 pandemic on the Company’s financial position has been partially mitigated or offset by the fixed revenue under the United capacity purchase agreement and by funds received under the Paycheck Protection Program and the Payroll Support Program described below. If United does not pay the full amount Air Wisconsin believes it is required to pay under the agreement, whether due to its own financial disruption resulting from the COVID-19 pandemic or the industry-wide pilot shortage, as a result of the current dispute with Air Wisconsin, or otherwise, the Company could experience a significant adverse effect on its results of operations, financial condition and liquidity. For additional information regarding the United capacity purchase agreement dispute, refer to Note 8, Commitments and Contingencies . A portion of the fixed amount of revenue had been deferred based on future expected flight activity, since fixed revenue is allocated over current and expected future departures through the end of the contract term, including the wind-down period. Beginning with the third quarter of 2021, Air Wisconsin began to reverse prior deferred revenue based on increased completed flights and projected future completed flight activity, and anticipates continuing to do so through the end of the wind-down period. For additional information, refer to Note 1, Summary of Significant Accounting Policies . Paycheck Protection Program Air Wisconsin’s receipt of governmental assistance mitigated to some extent the adverse impacts of the COVID-19 pandemic on the Company’s financial condition, results of operations and liquidity. In April 2020, Air Wisconsin received a $10,000 loan (SBA Loan) under the small business Paycheck Protection Program established under the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) and administered by the Small Business Administration (SBA). Under the CARES Act, Air Wisconsin applied for forgiveness of the SBA Loan, and the SBA granted forgiveness of all principal and accrued interest on the SBA Loan in August 2021 in the amount of $10,135, which was recorded as gain on extinguishment of debt in the audited consolidated statements of operations for the year ended December 31, 2021 included within the 2021 Annual Report. Payroll Support Program In April 2020, Air Wisconsin entered into a Payroll Support Program Agreement (PSP-1 Agreement) with respect to payroll support (Treasury Payroll Support) from the U.S. Department of the Treasury (Treasury) under a program (Payroll Support Program) provided by the CARES Act. Pursuant to the PSP-1 Agreement, Air Wisconsin received approximately $42,185, all of which was received in the year ended December 31, 2020. In December 2020, the federal Consolidated Appropriations Act of 2021 (PSP Extension Law) was adopted, which provided for additional payroll support to eligible air carriers. In March 2021, pursuant to the PSP Extension Law, Air Wisconsin entered into a Payroll Support Program Extension Agreement with the Treasury (the PSP-2 Agreement), which is substantially similar to the PSP-1 Agreement. Air Wisconsin received approximately $32,987 pursuant to the PSP-2 Agreement, all of which was received in the year ended December 31, 2021. In March 2021, the federal American Rescue Plan Act of 2021 (American Rescue Plan) was adopted, which provided further payroll support to eligible air carriers. In June 2021, pursuant to the American Rescue Plan, Air Wisconsin entered into a Payroll Support Program 3 Agreement with the Treasury (the PSP-3 Agreement and, together with the PSP-1 Agreement and the PSP-2 Agreement, the PSP Agreements), which is substantially similar to the PSP-1 Agreement and the PSP-2 Agreement. Air Wisconsin received approximately $33,329 pursuant to the PSP-3 Agreement, all of which was received in the year ended December 31, 2021. The PSP Agreements contain various covenants, some of which have expired. The surviving covenants require that (i) the payroll support proceeds must have been used exclusively for the payment of wages, salaries and benefits, and (ii) Air Wisconsin cannot pay total compensation to certain employees in excess of certain total compensation caps. If Air Wisconsin failed to comply with any of its expired obligations or failed or fails to comply with any of its continuing obligations under these agreements, it may be required to repay some or all of the funds provided to it under the PSP Agreements. Any such default, acceleration, insolvency or failure to comply would likely have a material adverse effect on the Company’s business. The Treasury commenced a routine audit of Air Wisconsin’s compliance with the terms of the PSP-1 Agreement. No such audits have been initiated by the Treasury under the PSP-2 Agreement or PSP-3 Agreement as of the date of this filing. For additional information, refer to Note 8, Commitments and Contingencies. The proceeds of the Treasury Payroll Support under the PSP Agreements were recorded in cash and cash equivalents when received and were recognized as a contra-expense under Payroll Support Program in the consolidated statements of operations for the periods for which the funds were intended to offset payroll expenses. As all amounts were recognized at December 31, 2021, Air Wisconsin did not recognize a reduction in operating expense in the three and nine months ended September 30, 2022, as compared to $16,146 and $66,316 for the three and nine months ended September 30, 2021, respectively.

In addition, the United capacity purchase agreement is scheduled to terminate in February 2023, unless sooner terminated in accordance with its terms, in each case subject to a wind-down period following termination during which aircraft would be removed from service under the agreement in accordance with a schedule. Although a wind-down schedule has not yet been determined, the Company has estimated a wind-down schedule for purposes of its revenue calculations. The American capacity purchase agreement provides that a certain number of aircraft each month, commencing in March 2023, will begin flying scheduled flights for American.

Before any Air Wisconsin aircraft can be available to operate flights for American, that aircraft must first be removed from service under the United capacity purchase agreement, painted to meet the livery requirements of the American capacity purchase agreement and otherwise modified to meet such requirements. During the period from the withdrawal of an aircraft from service under the United capacity purchase agreement until it is placed into service under the American capacity purchase agreement, that aircraft will not generate revenues from either United or American. The period of time that an aircraft will not be covered by either capacity purchase agreement depends on the wind-down schedule that has not been finally determined. The successful transition of aircraft from the United capacity purchase agreement to the American capacity purchase agreement is subject to many factors, some of which are not within Air Wisconsin’s control, including the level of cooperation from United and the timing for aircraft to meet the requirements of the American capacity purchase agreement. There can be no assurance that this transition will proceed smoothly, and unexpected delays in or costs associated with the transition could have a material adverse effect on the Company’s business, financial condition and results of operations.

For additional information, refer to Part II, Item 5, “

American Capacity Purchase Agreement

” within this Quarterly Report.

United Capacity Purchase Agreement

The fixed amount Air Wisconsin is entitled to receive under the United capacity purchase agreement is based on a fixed contractual rate and number of covered aircraft, although there is currently a dispute with United as to the number of covered aircraft for which it is required to pay the fixed contractual rate. In October 2022, United initiated arbitration with respect to this dispute.

Variable revenue may be earned based on the number of block hours and departures. Since the onset of the

COVID-19

pandemic, variable revenues have been significantly reduced due to the lower number of flights relative to historical levels. However, the impact of the

COVID-19

pandemic on the Company’s financial position has been partially mitigated or offset by the fixed revenue under the United capacity purchase agreement and by funds received under the Paycheck Protection Program and the Payroll Support Program described below. If United does not pay the full amount Air Wisconsin believes it is required to pay under the agreement, whether due to its own financial disruption resulting from

the COVID-19 pandemic

or the industry-wide pilot shortage, as a result of the current dispute with Air Wisconsin, or otherwise, the Company could experience a significant adverse effect on its results of operations, financial condition and liquidity. For additional information regarding the United capacity purchase agreement dispute, refer to Note 8,

Commitments and Contingencies

A portion of the fixed amount of revenue had been deferred based on future expected flight activity, since fixed revenue is allocated over current and expected future departures through the end of the contract term, including the wind-down period. Beginning with the third quarter of 2021, Air Wisconsin began to reverse prior deferred revenue based on increased completed flights and projected future completed flight activity, and anticipates continuing to do so through the end of the wind-down period. For additional information, refer to Note 1,

Summary of Significant Accounting Policies

Paycheck Protection Program

Air Wisconsin’s receipt of governmental assistance mitigated to some extent the adverse impacts of the

COVID-19

pandemic on the Company’s financial condition, results of operations and liquidity.

In April 2020, Air Wisconsin received a $10,000 loan (SBA Loan) under the small business Paycheck Protection Program established under the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) and administered by the Small Business Administration (SBA). Under the CARES Act, Air Wisconsin applied for forgiveness of the SBA Loan, and the SBA granted forgiveness of all principal and accrued interest on the SBA Loan in August 2021 in the amount of $10,135, which was recorded as gain on extinguishment of debt in the audited consolidated statements of operations for the year ended December 31, 2021 included within the 2021 Annual Report.

Payroll Support Program

In April 2020, Air Wisconsin entered into a Payroll Support Program

Agreement (PSP-1 Agreement)

with respect to payroll support (Treasury Payroll Support) from the U.S. Department of the Treasury (Treasury) under a program (Payroll Support Program) provided by the CARES Act. Pursuant to

the PSP-1 Agreement,

Air Wisconsin received approximately $42,185, all of which was received in the year ended December 31, 2020.

In December 2020, the federal Consolidated Appropriations Act of 2021 (PSP Extension Law) was adopted, which provided for additional payroll support to eligible air carriers. In March 2021, pursuant to the PSP Extension Law, Air Wisconsin entered into a Payroll Support Program Extension Agreement with the Treasury

(the PSP-2 Agreement),

which is substantially similar to

the PSP-1 Agreement.

Air Wisconsin received approximately $32,987 pursuant to

the PSP-2 Agreement,

all of which was received in the year ended December 31, 2021.

In March 2021, the federal American Rescue Plan Act of 2021 (American Rescue Plan) was adopted, which provided further payroll support to eligible air carriers. In June 2021, pursuant to the American Rescue Plan, Air Wisconsin entered into a Payroll Support Program 3 Agreement with the Treasury

(the PSP-3 Agreement

and, together with

the PSP-1 Agreement

and

the PSP-2 Agreement,

the PSP Agreements), which is substantially similar to

the PSP-1 Agreement

and

the PSP-2 Agreement.

Air Wisconsin received approximately $33,329 pursuant to

the PSP-3 Agreement,

all of which was received in the year ended December 31, 2021.

The PSP Agreements contain various covenants, some of which have expired. The surviving covenants require that (i) the payroll support proceeds must have been used exclusively for the payment of wages, salaries and benefits, and (ii) Air Wisconsin cannot pay total compensation to certain employees in excess of certain total compensation caps. If Air Wisconsin failed to comply with any of its expired obligations or failed or fails to comply with any of its continuing obligations under these agreements, it may be required to repay some or all of the funds provided to it under the PSP Agreements. Any such default, acceleration, insolvency or failure to comply would likely have a material adverse effect on the Company’s business. The Treasury commenced a routine audit of Air Wisconsin’s compliance with the terms of

the PSP-1 Agreement.

No such audits have been initiated by the Treasury under

the PSP-2 Agreement

or PSP-3 Agreement

as of the date of this filing. For additional information, refer to Note 8,

Commitments and Contingencies.

The proceeds of the Treasury Payroll Support under the PSP Agreements were recorded in cash and cash equivalents when received and were recognized as a contra-expense under Payroll Support Program in the consolidated statements of operations for the periods for which the funds were intended to offset payroll expenses. As all amounts were recognized at December 31, 2021, Air Wisconsin did not recognize a reduction in operating expense in the three and nine months ended September 30, 2022, as compared to $16,146 and $66,316 for the three and nine months ended September 30, 2021, respectively.