1. Engine (clause 2.3.1(i); annex 1, definition)

CFM56-7 spare engine bearing Engine Serial Number 874357

Serviceability Tag:

Latest EASA Form 1 and FAA Form 8130-3 release certificate or alternatively one EASA Form 1 with FAA dual release or FAA form 8130-3 with EASA dual release.

2A+B. Engine Flight Hours (2A) and Engine Flight Cycles (2B) /Since Last Overhaul (clause 2.3.1(ii); Annex 1, Definitions)

Engine Flight Hours since new:

as per technical documentation

Engine Flight Cycles since new:

as per technical documentation

3A+B. Additional Conditions Precedent to Lessee’s Obligations (clause 2.3.1(iii)) (3A) and to Lessor’s Obligations (clause 2.3.3) (3B)

3A Lessee’s Obligations

Engine to be in the agreed condition

3B Lessor’s Obligations

Lessor’s confirmation of receipt of the Lessee’s first payment of Rent on or prior to the Commencement Date.

4. Conditions Precedent Time Period (clause 2.3.2)

From the date of this Lease Agreement to the Commencement Date.

5. Commencement Date (clause 2.4.1; annex 1, definition)

Upon Delivery of the Engine to Lessee FCA (Free Carrier on Board) Incoterms 2010 at Air Salvage International, Hangars H1 and H2, Cotswold Airport, Cirecestershire, Gloucestershire GL7 6BA, United Kingdom

(“Delivery Location”).

This is estimated to be on or about 29^th of September 2017 as shall be evidenced by the date of the Acceptance Certificate.

6. Acceptance Certificate (clause 2.4.2; annex 1, definition)

An Acceptance Certificate is required (form attached as Appendix A).

7. Deposit and/or Letter of Credit (clause 3.1)

*          

8. Rent (clause 3.2; annex 1, definition) US$ *                  per day, paid in advance for the following month.

9. Rent Payment Date (clause 3.2; annex 1, definition)

On the Commencement Date and on the equivalent date of each subsequent calendar month during the Term upon receipt of a corresponding invoice.

Invoices shall be sent by Lessor per email to

(1) the respective lease manager and to

(2) invoice@mtu-lease-services.com

10. Default Rate (clause 3.5; annex 1, definition)

*                                                                       

11. Agreed Currency (clause 3.7.2; annex 1, definition)

United States Dollars ($).

12. Payment Account (clause 3.7.2; annex 1, definition)

Bank: Old National Bank

1 Main Street

Evansville, IN 47708

ABA#:                                 

Account#:                             

SWIFT Code:                                 

Beneficiary: Contrail Aviation Support, LLC

435 Investment Court

Verona, WI 53593

13. Engine Documentation (clause 4.2.1(i))

- Latest EASA Form 1 and FAA Form 8130-3

   release certificate or alternatively one

   EASA Form 1 with FAA dual release or

   FAA form 8130-3 with EASA dual release

- serviceable removal tag (as applicable)

- LLP status

- latest FAA & EASA AD status

- latest SB status

- last operator NIS

- result of last Maximum Power Assurance run (MPA)

- last test cell run report

- latest BSI report

- BSI DVD

- last 3 months Cruise & Take-off ECM data

- latest zero letter (MPD) check – MPD task compliance status

- accessory and QEC status

- missing parts list

- shipping stand details

- ship loose & bypack parts (as applicable)

- preservation data (tag, work cards)

- engine removal/installation history

- carry-forward sheet

- oil consumption report

- used oil type

14. Engine Reports—Other Information (clause 4.2.4(ii))

By the 10th day of each month, Lessee shall provide a monthly utilization report to Lessor, substantially in the form of Appendix B, for the preceding month that includes:

a. the total number of flight hours and flight cycles the Engine was operated the preceding month; and

b. engine configuration during preceding month; and

c. maintenance performed during preceding month; and

d. the average cruise and take-off EGT margins for the preceding month; and

e. if Lessor does not receive the flight hours and cycles by the 10^th day of each month, Lessor may invoice Lessee for an estimated number of flight hours and flight cycles for the preceding month and reconcile the differences within thirty (30) days after receipt of the applicable monthly utilization report.

- last SV report (as applicable)

- engine pictures

The confidential portion has been omitted pursuant to a request for confidential treatment filed by Air T, Inc. with the Securities Exchange Commission and filed separately with the Commission.

15. Engine Installation/Removal Notification Requirements (clause 4.2.6)

Within 10 days of each installation or removal of the Engine, Lessee shall report the following in writing:

a. operated thrust rating; and

b. aircraft serial number and engine position and shall also provide Lessor with off-on LLP disk sheets, all printed on the operator’s letterhead and signed by operator’s quality control department.

16. Certain Lessee Obligations Concerning Indemnitees (clause 4.4.6)

If Lessee is not the owner of the aircraft on which the Engine shall be attached to, Lessee shall, at its expense, at the request of Lessor, provide a document signed by the owner of and/or any secured party with respect to the aircraft recognizing the rights of the Engine owner, in form and substance acceptable to Lessor.

17. Consequences of Partial Loss (clause 7.2.1(ii))

The Engine will continue to be leased as set out in clause 7.2.1(ii)(a).

18. Stipulated Amount (clause 7.3.1; annex 1, definition)

USD *                 

19. Reinsurance (clause 8.1)

In the event where the Permitted Sub-Lessee is not insured by an insurance company recognized by the London/New York markets, Permitted Sub-Lessee shall provide reinsurances, issued by a re-insurance company recognized by the London/New York markets.

20. Redelivery Location (clause 11.1(i); annex 1, definition)

DDP (Delivered Duty Paid) Incoterms 2010 (provided Lessee shall be responsible for unloading the Engine) at MTU Maintenance Hannover or any other delivery location as mutually agreed by the parties.

21. Redelivery—additional requirement (clause 11.1(ii))

*                                                                                                          

22. Final Inspection – other tests (clause 11.3.1(ii))

All inspections, tasks and reports specified in Appendix C.

*                                                                                          

The confidential portion has been omitted pursuant to a request for confidential treatment filed by Air T, Inc. with the Securities Exchange Commission and filed separately with the Commission.

23. Redelivery – Additional Documentation (clause 11.4(viii))

*                                                                                                                           

24. Transportation – supplemental requirements (clause 11.5)

Manufacturer’s published engine transportation manual, specifications/recommendations, including proper equipment tie-down and use of air-ride or air cushion suspension vehicles. On any given shipment, such truck will be dedicated solely to the Engine belonging to Lessor; except that additional items may be transported on such truck, provided that (a) the Engine can and will be off-loaded by Lessor at the Redelivery Location without disturbing any of the additional items and (b) Lessee or its shipper will not handle or reposition any of the additional items on such truck either while the Engine is in transit or when it arrives at the Redelivery Location. Lessor will invoice and Lessee agrees to pay for the cost of inspections and repairs to the Engine and/or transportation stand resulting from the improper movement or transportation of the Engine and/or transportation stand.

25. Additional Amounts – Term Extension (clause 11.6.2)

If (1) Lessee retains the Engine beyond the Scheduled Final Date set forth in Section 35; (2) the Engine has not been returned to Lessor in the conditions required by Sections 21, 22, and 23; and (3) does not execute a written lease extension with Lessor, Lessor may at its sole discretion, (a) remedy such defects and deficiencies and recover any costs so incurred from Lessee; and/or (b). continue the Lease and Lessee will pay Lessor *                  times Rent for each day after the Scheduled Final Date until Lessee either returns the Engine to the Redelivery Location and satisfies all return conditions or executes a written lease extension. All obligations of Lessee under the Lease Agreement shall remain in full force and effect until the return of the Engine in the condition required by the Lease Agreement. This will not be considered a renewal of the Lease Agreement or extension of the Lease Term or waiver of any right of Lessor under the Lease Agreement.

26. Differing Period (clause 14.1(i))

N/A.

The confidential portion has been omitted pursuant to a request for confidential treatment filed by Air T, Inc. with the Securities Exchange Commission and filed separately with the Commission.

Notices shall be sent by post or fax to the respective parties at the address or fax numbers set out below or as otherwise advised by one party to the other in compliance with clause 16.5:

Lessor

Address:  Contrail Aviation Support, LLC

435 Investment Court Verona

WI 53593

USA

Attn:       President

Fax:        +1 608 848 8101

Lessee

Address:    Strawinskylaan 1639

                  1077XX Amsterdam

                  The Netherlands

Attn:          Managing Director

Fax:           +31 (0) 20 705 49 08

Notices by fax are acceptable as per box 27 or electronic media is permitted.

29. Governing Law (clause 17.7)

Laws of the State of New York.

30. Non-exclusive Jurisdiction (clause 17.8.1(i))

Courts of the State of New York and the United States District Court located in the Borough of Manhattan, New York City, New York, United States of America.

31. Additional Indemnitees (annex 1, definition) (for use, inter alia, in definition of “Indemnitees”)

Lessor; any person from time to time notified by Lessor to Lessee as providing financing to Lessor or the owner of the Engine for the acquisition, ownership or leasing thereof; together with each of their respective successors and assigns, shareholders, subsidiaries, affiliates, partners, contractors, directors, officers, servants, agents and employees.

32. Business Day (annex 1, definition)

Evansville, Indiana, United States of America Amsterdam, The Netherlands

33. Use Fee Amount (Cycle) (annex 1, definition) (for use in definition of “Use Fees (Cycle)”

US$ *                 

This Use Fee Amount (Cycle) shall be adjusted annually, effective January 1 of each year, based on the OEM published annual escalation rate or escalation percentage for a set of CFM56-7B life limited parts.

34. Use Fee Amount (Flight Hour) (annex 1 definition) (for use in definition of “Use Fees (Flight Hours)”)

as per Appendix D

Lessee shall not lease the Engine to any operator with its principal place of business in any of the ‘Harsh Environment Countries’ listed in Appendix E.

35. Scheduled Final Date (annex 1, definition (for use in definition of “Final Date”)

12 months – date by which Lessee shall have completed all redelivery conditions, including but not limited to the items specified in Sections 20-23, and returned Engine to the Redelivery Location.

Lessee may extend the Term by a period of 12 months by giving written notice to Lessor at least 4 weeks prior to the Scheduled Expiry Date.

36. Principal Taxation Jurisdictions (annex 1, definition) (for use in definition of “Lessor Tax”)

USA

37. Calculation Discount Rate (annex 1, definition (for use in definition of Termination Damage Amount))

*                                                                       

*                                                    

38. Threshold Amount (annex 1, definition)

An Engine repair in the amount of US$ *                  , either estimated or actual, above which Lessee requires Lessor’s permission before proceeding with the repair.

39. Required Liability Amount (annex 4, clause 4)

*                 

40. Deductibles (annex 4, clause 8)

Hull All Insurance—US$ *                 

Spares Insurance—US$    *              

The confidential portion has been omitted pursuant to a request for confidential treatment filed by Air T, Inc. with the Securities Exchange Commission and filed separately with the Commission.

no Event of Default has occurred and is continuing

any such sub-lease agreement:

shall be subject and subordinate in all respects to this Agreement

shall not be capable of extending beyond the end of the Lease Period;

the relevant Permitted Sub-Lessee covenants directly to the Lessor not to do anything which would prejudice the Lessor’s interests, rights and benefits in the Engine and/or the Insurances and/or under this Agreement or any other lessee document and/or the interests, rights and benefits of the relevant parties in the Engine and/or the Insurances and/or this Agreement under the relevant documents, and agrees directly with the Lessor that such Permitted Sub-Lessee’s rights under such sub-lease shall be subject and subordinate in all respects to the rights of the Lessor under this Agreement; and

the terms of the relevant sub-lease, shall provide that the leasing, chartering or hiring of the Engine to such Permitted Sub-Lessee and that the right of the Permitted Sub-Lessee to the use, possession and enjoyment of the Engine shall terminate simultaneously with the giving by the Lessor of any notice pursuant to this Agreement; and

notwithstanding the foregoing provisions of this clause, no relevant sub-lease permitted under this clause shall involve any transfer of title to or interest in the Engine or any part thereof, nor shall it in any way discharge or diminish any of the Lessee’s obligations to the Lessor under this Agreement or under any other document.

For purposes of this Agreement, all references to the JAA also include the European Aviation Safety Agency as successor to the JAA (“EASA”). If Part I, point 1 of this Lease Agreement indicates the Engine will be supplied to Lessee with both FAA and JAA serviceability tags, then

Section 4.7.1 of the Master Agreement is modified by, in subparagraph (ii), deleting the words “FAA or JAA” and replacing them with the words “FAA and JAA;”

Section 11.2.1 of the Master Agreement is restated as follows: “The redelivered Engine shall have valid serviceability tags issued by the FAA and JAA, respectively.

The following new definitions are inserted in the correct alphabetical position in annex 1:

A new clause 2.4.3 is added as follows:

Section 4.6.1 of the Master Agreement is modified by adding the following to the end of the first sentence:

Section 4.6.2 of the Master Agreement is modified by:

replacing subparagraph (iii) thereof with the following:

adding the following new subparagraph (v) at the end thereof:

Section 8.1 of the Master Agreement is modified by adding the following to the end thereof:

Section 11.4 of the Master Agreement is modified by deleting subparagraph (vii) and replacing it with the following:

Section 17.16 of the Master Agreement is modified by deleting subparagraph (i)(a) and replacing it with the following:

Section 17.7 of the Master Agreement shall be deleted entirely and the following shall be added in lieu thereof:

Annex 1 of the Master Agreement is modified by:

deleting the definition of “Applicable Engine Standards” and replacing it with the following:

adding the following to the end of the definition of “Aviation Authority”:

adding the following to the end of the definition of “Law”:

Annex 4 of the Master Agreement is modified by adding the following to the end of point 9;

Clause 6 of Annex 4 is modified by inserting before the final sentence the following:

MTU Maintenance Lease Services B.V.

/s/ Martin Friis Petersen

Martin Friis Petersen

Managing Director

DATE:

Acceptance of Engine Package

on October 03 at Air Salvage International Ltd at Cotswold Airport in Gloucester UK, Lessee accepted delivery of the Engine, as described in Part I, point 1 of the Engine Lease Agreement and the Engine Documentation as described in Part I, point 13 of the Engine Lease Agreement;

annex 1 hereto lists all Parts and annex 2 lists all Engine Documentation so received by Lessee; and

the Engine Documentation confirms the Engine Flight Hours and Engine Flight Cycle information and data summarized on annex 3 hereto.

Hours Flown During the Preceding Month:

(Rounded to nearest whole hour)

The confidential portion has been omitted pursuant to a request for confidential treatment filed by Air T, Inc. with the Securities Exchange Commission and filed separately with the Commission.

A Full Performance Test cell run (“TCR”) according to the respective Engine type manual requirements including Engine Water Wash.

An On Wing Performance Test in the form of a Maximum Power Assurance run or similar test as further described in Exhibit E.5 with calculated EGTM result including Engine Water Wash to be performed immediately prior to Engine removal.

The Engine Fuel and Oil System shall be preserved long term (365 days) per AMM immediately prior to return of the Engine in accordance with the Lease Agreement.

A full End of Lease Inspection as required by the end of lease inspection requirements detailed in Exhibit E.5 of the Lease Agreement. Or respectively the inspection checks recommended by the OEM comprising all of the tasks listed in the current revision of the applicable aircraft manufacturer’s MPD and applicable to the Engine. The inspection check can be carried out in accordance with Lessee’s Maintenance Program.

A Full Engine Video/DVD Borescope Inspection (cold and hot section) post test cell/ground run is required in accordance with the AMM including leading edge and trailing edge.

Completely covering the Engine with the tarpaulin cover provided at Delivery.

Engine shipment in accordance with the manufacturer’s specifications/recommendations. Any trucks used for shipment of the Engine will be equipped with air ride or air cushion suspension system.

Operator certified NON-INCIDENT STATEMENT shall be issued upon redelivery, substantially in the form set out in the attached template printed on Airline headed paper and signed by authorized representative of Operator. (Exhibit E.2 of the Lease agreement).

Operator certified ETOPS CERTIFICATION at Engine removal. The ETOPS Certification needs to be on Airline letterhead signed by authorized representative of Operator. (Exhibit E.3 of the Lease agreement).

Complete operator certified ENGINE OPERATIONAL REPORT (Exhibit E.4 of the Lease agreement) printed on Airline headed paper, signed by authorized representative of Operator.

Operator certified FAA & EASA and Local Air Authority Airworthiness Directive (AD) STATUS current to redelivery date on Airline headed paper. It shall include all applicable AD’s, the Means of compliance for all accomplished AD’s and include the repetitive inspection compliance supporting data (if applicable).

If any AD’s or SB’s have been performed during the lease period, copies of accomplishment records/documents (job cards, work cards, etc) are required.

Operator certified LLP DISK SHEET at each Engine Removal. The LLP Sheet needs to be on Airline letterhead signed and dated.

Operator SERVICEABLE TAG issued in accordance with operator local aviation authority (if applicable). The copy should remain with the Engine. It should state that the Engine was removed in Serviceable Condition and removal reason. It should also state the Total Engine Time and Total Engine Cycles /TET and TEC) and removal date and removal location.

ENGINE TEST CELL REPORT, which shows Engine parameters at Hot Day Take-off.

Results of an On Wing Performance Test in the form of a Maximum Power Assurance run (MPA) or similar test (if applicable) with all recorded parameters with calculated and documented EGTM.

A written and certified BORESCOPE REPORT per each stage, LE and TE, based on the Full Engine Video Borescope Inspection performed after the Test Cell run (or MPA run) and compiled by an approved Air Regulatory Source including two copies of the VIDEO BORESCOPE (DVD or CD-Rom).

ENGINE TREND MONITORING DATA, including take-off and cruise performance data, cruise mechanical data for the duration of the Engine’s operation throughout the Lease Term.

END OF LEASE (EOL) INSPECTION check list (refer to attached Inspection Check List Exhibit E.5) completely signed by mechanic/technician and inspector or responsible person within a maintenance organization performing the inspection. Or respectively the inspection checks recommended by the OEM comprising all of the tasks listed in the current revision of the applicable aircraft manufacturer’s MPD and applicable to the Engine. The inspection check can be carried out in accordance with operator’s maintenance program.

ENGINE ACCESSORY and QEC LIST at Engine redelivery. Engine should be returned with the same inventory as provided at Delivery. Lessee has to send an updated Engine Accessory and QEC List in accordance with the list dated [●] provided with the Engine at Delivery. Any component changes must be supported with adequate records. At minimum date of installation, engine TSN/CSN at component installation. All such replacement parts must be certified with FAA dual or EASA dual release certificate, with back to birth traceability on all LLP’s. In addition, full traceability (TSO/TSR) is required for any significant rotable component. Lessor is entitled to reject a replacement component if it is not in same or higher modification status as original part or satisfied with the standard of the components or the quality of its associated records.

Engine FAA 8130-3 and EASA FORM ONE RELEASE CERTIFICATE or alternative a EASA DUAL RELEASE CERTIFICATE or FAA 8130-3 DUAL RELEASE CERTIFICATE. The copy should remain with the Engine. It should state the Total Engine Time and Total Engine Cycles /TET and TEC), removal date and that the Engine was removed in Serviceable Condition, reason for removal and mention all inspection/work accomplished. (MPA run or test cell run, preservation and preservation date , BSI, “EOL Inspection Checks”, etc).

PRESERVATION TAG with date of expiration confirming that the Engine oil system and fuel system was long term preserved for 365 days. All openings of the Engine have to be capped and plugged.

A copy of signed/stamped Task Card covering Engine long term preservation.

A copy of operator Aircraft Tech Log Sheet showing Engine installation/removal from wing.

A copy of signed/stamped Task Card showing Engine installation/removal from wing.

A copy of maintenance records showing Engine conversion at engine installation/removal from wing (if applicable).

TECHNICAL LOG PAGES and PILOT REPORTS related to the Engine that occurred throughout the Lease Term including the respective corrective actions.

UNSCHEDULED MAINTENANCE EVENTS and INSPECTION REPORTS.

SCHEDULED MAINTENANCE and INSPECTIONS accomplished in accordance with operator APPROVED MAINTENANCE PROGRAM

OPEN/DEFERRED/CARRY FORWARD items, documentation covering any Open items, Deferred Defects or Carry Forward items.

19

DIGITAL PHOTOS of the Engine accessories including Engine data plate prior to covering, and photos of the Engine in bagged condition (Refer to MTU EOL check list Exhibit E.5).

DESCRIPTION

REF EIPC

QTY

PART NUMBER

22

DESCRIPTION

REF PPBUM

QTY

PART NUMBER

COUPLING, INTERSECTION MANIFOLD

(2EA)

24

26

END

OF

LEASE

REQUIREMENTS

TASK #

TASK DESCRIPTION

BOEING MPD &

AMM REFERENCE

REMARKS

INSPECTOR

Date/Signature/Stamp

OPERATOR

TASK

CHECK AD NOTE STATUS. CHECK FOR

REQUIRED FAA-EASA AD AND SB OEM CAT

1, 2 INCORPORATION.

NOTE: When Engine in MTU Shop - SB

check per MTU lease group advice.

CHECK AIRCRAFT DATA FOR ATA CHAPTER

70-80 CLASS 3 FAULTS.

OPERATOR

TASK

CLEAN THE ENGINE GAS-PATH WITH PURE

WATER.

NOTE: Before On-Wing or Test Cell run.

AMM 72-00-00-100-803

EM 72-00-00-100-002 Clean 002

PERFORM FULL PERFORMANCE TEST CELL

RUN TEST 003 AND 009 OR FOLLOWING GROUND TESTS: NO. 3A, 5, 7, 8, 13 AND PROVIDE WRITTEN REPORTS.

AMM 71-00-00-700 (ON-WING-TEST)

EM 72-00-00-760 (TEST CELL)

27

PRESERVATION OF AN ENGINE FROM ONE

MONTH TO ONE YEAR.

ATTACH PRESERVATION INFORMATION

LABEL ON ENGINE OIL TANK THAT ENGINE

HAS BEEN PRESERVED.

NOTE: On-Wing or Test Cell.

AMM 71-00-03-6008-11

(ON WING)

ESM 72-00-00-500-001

(TEST CELL)

VERIFY CURRENT EEC SOFTWARE VERSION ON INSTALLED EEC.

NOTE: Pay attention to information on software modification label below EEC identification plate.

EEC P/N:

EEC S/N:

Software Version:

CREATE AND COMPLETE ENGINE INVENTORY LIST.

NOTE: Based on MTU lease group delivered listing.

CREATE AND COMPLETE MISSING PARTS LIST AGAINST EIPC AND PPBUM.

NOTE: Applicable when engine delivered with Missing parts list.

NOTE: When Engine in MTU Shop -

Missing part check per MTU lease group advice.

EXTERNAL GENERAL VISUAL INSPECTION OF ENGINE FOR ANY OBVIOUS DAMAGE THAT MAY HAVE OCCURRED DURING TRANSPORTATION.

NOTE: Task should be performed after Engine transportation from removal location to locatin where visual inspections are carried-out.

GENERAL VISUAL INSPECTION OF ENGINE

DRAIN LINES.

OPERATIONALLY CHECK LEFT/RIGHT

ENGINE ALL DRAIN LINES.

For info only: every 6 years

PERFORM GENERAL VISUAL INSPECTION OF

ENGINE SHIPPING STAND (BASE AND

CRADLE) INCLUDING WHEELS, TOW BARS,

RIGHT GUARDS FOR ANY DAMAGES AND

MISSING PARTS.

REPORT TO MTU LEASE GROUP ANY

FINDINGS OR MISSING PARTS.

INSPECT ENGINE COVER FOR DAMAGES

SUCH AS TEARS AND HOLES.

DETAILED INSPECTION OF THE LEFT/RIGHT ENGINE FWD SUMP, AFT SUMP, AGB/TGB MAGNETIC CHIP DETECTORS FOR PARTICLES (FOR ENGINES WITH MCD) OR INTERROGATE DMS FOR CHIP DETECTOR STATUS.

NOTE: FOR ENGINES WITH DEBRIS

MONITORING SYSTEM.

For info only: Inspection Threshold 500 FH,

Repeat 500 FH.

MPD 72-320-01/02 AMM 79-00-00-200-804

AMM 79-00-00-710-801

CONTAMINATION FOUND:

YES

NO

Note: circle as approprIate.

REMOVE, INSPECT, AND REPLACE THE LEFT/RIGHT ENGINE OIL SUPPLY FILTER ELEMENT.

INSPECT FOR CONTAMINATION AND

IDENTIFY AS NECESSARY. REPLACE WITH

NEW FILTER AND CONSUMABLES.

For info only: Inspection Threshold 7500

FH, Repeat 7500 FH.

MPD 79-010-01/02 AMM 79-21-03-000-802

AMM 79-21-03-400-801

CONTAMINATION FOUND:

YES

NO

Note: circle as appropriate.

29

DETAILED INSPECTION OF THE LEFT/RIGHT

ENGINE OIL SUPPLY FILTER POP-OUT

INDICATOR.

REMOVE, INSPECT, AND REPLACE THE

LEFT/RIGHT ENGINE OIL SCAVENGE FILTER ELEMENT.

INSPECT FOR CONTAMINATION AND

IDENTIFY IF NECESSARY. REPLACE WITH

NEW FILTER AND CONSUMABLES.

For info only: Inspection Threshold 7500

FH, Repeat 7500 FH.

MPD 79-040-01/02 AMM 79-21-06-000-801

AMM 79-21-06-400-801

CONTAMINATION

FOUND:

YES

NO

Note: circle as appropriate.

DETAILED INSPECTION OF THE LEFT/RIGHT

ENGINE STARTER MAGNETIC CHIP

DETECTOR FOR METAL CHIPS.

For info only: Inspection Threshold 1600

FC, Repeat 1600 FC

CONTAMINATION

FOUND:

YES

NO Note: circle as

appropriate.

EXTERNAL OIL SYSTEM INSPECTION

NOTE: applicable to engine areas only.

REMOVE AND REPLACE THE LEFT/RIGHT

ENGINE FUEL FILTER .

REPLACE WITH NEW FILTER AND

CONSUMABLES.

NOTE: Do not install Fuel Filters listed in

AD 2006-26-01!

Record part number of newly installed Fuel Filter.

For info only: Inspection Threshold 6000

FH, Repeat 6000 FH

MPD 73-010-01/02 AMM 73-11-02-000-801

AMM 73-11-02-400-801

FAA AD Note 2006-26-01

CONTAMINATION

FOUND:

YES

NO

Note: circle as

appropriate.

New P/N installed:             

AMM 73-11-03-000

AMM 73-11-03-400

CONTAMINATION

FOUND:

YES

NO

Note: circle

as appropriate.

AMM 73-11-05--700-801

CFMI SB 72-0876

DETAILED INSPECTION OF LEFT/RIGHT ENGINE INLET AND FAN BLADES.

For info only: Inspection Threshold 2500 FH, Repeat 2500 FH.

MPD 72-020-01/02

AMM 72-21-00-220-801

RELUBRICATE LEFT/RIGHT ENGINE FAN BLADES DOVETAIL. (FAN BLADES REMOVED) VISUALLY INSPECT REMOVED COMPONENTS AND EXPOSED AREAS (SPINNER CONE, RETAINING RING, PLATFORMS, SPACERS, FAN BLADES, SHIMS, FAN DISK, ETC..).

PAY SPECIAL ATTENTION FOR EVIDENCE OF BIRD STRIKE AND/OR FOD DAMAGE.

NOTE: To be performed if required and based on last lubrication (MTU to advise).

MPD 72-025-01/02 AMM 72-21-00-640-801

CFMI CESM 005

AMM 72-21-01-200-801

AMM 72-21-02-200-801

CFMI SB 72-0884

PREPARE ACTUAL FAN BLADE DISTRIBUTION LIST WHICH INCLUDE ENGINE SERIAL NUMBER, ISSUE DATE, FAN BLADE POSITION, PART NUMBER, SERIAL NUMBER, MOMENT WEIGHT AND TECHNICIAN OR INSPECTOR NAME WITH SIGNATURE. CHECK EFFECTIVITY OF SB 72-0797 FOR EACH FAN BLADE AND RECORD COMPLIANCE.

NOTE: Applicable only if Fan Blades are removed.

31

VISUAL CHECK OF THE LEFT/RIGHT

ENGINE AFT MOUNTS CLEVIS FOR

STRUCTURAL

INTERGRITY FAILURE.

MPD 72-300-01/02

AMM 72-56-00-200-802

For info only: Inspection Threshold 7500

FH, Repeat 7500 FH.

DETAILED INSPECTION OF THE LEFT/RIGHT

ENGINE EXHAUST PLUG DRAIN PAN AND

TUBE FOR CONDITION AND SECURITY.

NOTE: Applicable to Engine with Exhaust

Plug equipped with Drain Pad and tube system installed.

ACCESS NOTE: Engine Exhaust Plug removal required.

For info only: Inspection interval every engine change.

PRIMARY NOZZLE ASSEMBLY AND PRIMARY

PLUG ASSEMBLY INSPECTION.

VISUALLY INSPECT PRIMARY EXHAUST

NOZZLE LABYRINTH SEALS.

VISUAL CHECK OF THE LEFT/RIGHT ENGINE ACCESSORY GEARBOX/TRANSFER GEARBOX MOUNT FLANGES AND FAN CASE AND FAN

FRAME ATTACHMENT MOUNTS.

For info only: Inspection Threshold 15000

FH, Repeat 15000 FH.

MPD 72-070-01/02
AMM 72-20-00-210-801

AMM 72-60-00-200-801

AMM 72-63-00-200-801

GENERAL VISUAL INSPECT FORWARD ENGINE MOUNT ASSEMBLY INCLUDING FAN CASE FITTING, SIDE LINKS, HANGER AND LINK PINS.

For info only: Inspection Threshold 6 YRS, Repeat 18000 FC whichever comes first.

MPD 54-010-01/02 AMM 51-05-01-210

AMM 54-05-03-210

GENERAL VISUAL INSPECT LEFT STRUT ATTACH BOLTS AT FORWARD ENGINE MOUNT.

For info only: Inspection Threshold 9 YRS, Repeat 18000 FC whichever comes first.

MPD 54-015-01/02 AMM 51-05-01-210

AMM 54-05-03-210

GENERAL VISUAL INSPECTION OF FORWARD AND AFT ENGINE MOUNT TO STRUT SHEAR PINS.

NOTE: Engine off-wing.

For info only: Inspection intervall at engine removal.

MPD 54-020-01/02 AMM 51-05-01-210

AMM 54-05-03-210

GENERAL VISUAL INSPECTION OF AFT ENGINE MOUNT ASSEMBLY INCLUDING THRUST LINKS AND THRUST LINK PINS; MOUNT TO ENGINE LEFT, CENTER AND RIGHT LINKS, INCLUDING LINK PINS; HANGAR AND EVENER BAR; ATTACH BOLTS.

For info only: Inspection Threshold 6 YRS, Repeat 18000 FC.

MPD 54-030-01/02 AMM 51-05-01-210

AMM 54-05-03-210

VISUAL CHECK OF THE LEFT/RIGHT ENGINE ATTACHMENT BOLTS FOR THE THRUST MOUNT FITTINGS.

For info only: Inspection Threshold 10000

FC, Repeat 10000 FC.

33

AFT ENGINE MOUNT VISUAL INSPECTION.

NOTE: Engine off-wing.

NOTE: Ensure Aft Mount and Center Link has correct marking IAW BOEING alert SB 737-71A1462 and that the Center Link is correctly installed on Aft Mount. Please advise to MTU leasegroup if Center Link was incorrectly installed or if markings are missing from Aft Mount Assy.

AMM 71-21-00-200-805

FAA AD Note 201-118-10

BOEING SB 737-

71A1462 REV.3

REPLACE EDP CASE DRAIN FILTER ELEMENT.

REPLACE WITH NEW FILTER ELEMENT AND

CONSUMABLES.

NOTE: If you find a large quantity of small metal particles, large metal particles that are not of equal dimensions, or a large quantity of steel particles, then replace the hydraulic pump. Write down the results of the filter inspection and give them to the pump overhaul facility.

For info only: Inspection Threshold 2400 FH, Repeat 2400 FH.

MPD 29-050-01/02 AMM 29-11-51-000-801

AMM 29-11-51-400-801

CONTAMINATION

FOUND:

YES

NO

Note: circle

as

appropriate.

CHANGE IDG OIL.

For info only: Threshold 1800 FH, Repeat 1800 FH

DETAILED INSPECTION OF IDG DELTA P

INDICATOR.

NOTE: When the DPI is in the up position and if the DPI resets decal (if installed) shows it is the 4th DPI extension, the IDG must be replaced.

For info only: Threshold 800 FH, Repeat 800 FH.

DETAILED INSPECTION OF IDG OIL

LEVEL.

For info only: Inspection Threshold 800 FH, Repeat 800 FH.

MPD 24-040-01/02 AMM 24-11-41-000-801

AMM 24-11-41-200-801

AMM 24-11-41-400-801

YES

NO

Note: circle

as appropriate.

AMM 70-70-01 -200-801

(without retension test)

AMM 74-21-02-200-801

CESM 006

IGNITION

PLUGS

REPLACED:

YES

NO

NOTE: circle

as

appropriate

35

DETAILED INSPECTION OF CONNECTORS

FOR TIGHTNESS (ALL CONNECTORS ON HARNESS J5, J6, J7, J8, J9, CJ9, J10, CJ10, MW0301, MW0302, MW0303 AND MW0304).

For info only: Inspection Threshold 15000 FH, Repeat 15000 FH.

INSPECT (DETAILED) THE IDG POWER

FEEDER WIRING AND CONNECTED EWIS-ENGINE #1/#2 (EZAP).

For info only: Inspection Threshold 5500 FC or 30 MO, Repeat 5500 FC or 30 MO (whichever comes first)

MPD 20-470/480-00

AMM 05-42-04-211-801/802

AMM 20-60-03-100-801

PERFORM VIDEO BORESCOPE INSPECTION

OF BOOSTER STG. 2 THROUGH STG.4

BLADES.

PERFORM VIDEO BORESCOPE INSPECTION

OF COMBUSTOR.

PERFORM VIDEO BORESCOPE INSPECTION

OF HPT NOZZLE GUIDE VANES.

NOTE: Perform complete 360° fiberscope inspection of LE (concave side) and TE (convex side).

AMM 72-00-00-200-806

(SAC & DAC engines)
AMM 72-00-00-200-818

(TI & BE engines)

PERFORM VIDEO BORESCOPE INSPECTION

OF HPT BLADES.

NOTE: Perform inspection of LE & TE and Tips of the HPT Blades.

PERFORM VIDEO BORESCOPE INSPECTION OF LPT NOZZLE STG. 1.

NOTE: Perform complete 360° fiberscope inspection of LE and TE.

PERFORM VIDEO BORESCOPE INSPECTION OF LPT STG. 1 THROUGH 3 BLADES.

NOTE: Perform inspection of LE & TE.

PERFORM VIDEO BORESCOPE INSPECTION OF LPT STG. 4 BLADES.

NOTE: Perform inspection of LE & TE.

AMM 72-00-00-200-809

INDENPENDENT INSPECTION OF CORRECT INSTALLATION OF THE HAND-CRANKING COVER.

NOTE: Applicable for PRE SB 72-0564 or PRE SB 72-0879 engine.

AMM 72-63-01-400-801

EASA AD 2012-0209

FAA AD Note 2013-26-01

CFMI SB 72-0564, 72-0879

37

PERFORM OUTGOING PHOTO DOCUMENTATION OF ENGINE BUILD CONFIGURATION. (FOLLOWING VIEWS: FRONT, RH FAN MODUL, BOTTOM FAN MODULE, LH FAN MODULE, UPPER FAN MODULE, RH CORE MODULE, BOTTOM CORE MODULE, LH CORE MODULE, UPPER CORE MODULE, REAR, ENGINE DATA PLATE, ENGINE OWNER PLATE, RH SHIPPING STAND GENERAL VIEW, LH SHIPPING STAND GENERAL VIEW, SHIPPING STANDS WHEEL, SHIPPING STAND IDENTIFICATION PLATES, SHIPPING STAND TOWING BARS, SHIPPING STAND BASE AND CRADLE IDENTIFICATION PLATE).

NOTE: After engine (ground run) or test cell run.

AMM 12-13-11-600-803

AMM 71-00-03-600

AMM 71-00-03-600-811

(ON WING)

ESM 72-00-00-500-001

(TEST CELL)

INSTALL DESICCANT AND ENGINE COVER. CLOSE THE COVER.

NOTE: Do not let desiccant touch the engine hardware.

AMM 71-00-03-600-811

(ON WING)

ESM 72-00-00-500-001

(TEST CELL)

Flight Hour to

Cycle Ratio

U.S. Dollars ($) per Flight Hour

The confidential portion has been omitted pursuant to a request for confidential treatment filed by Air T, Inc. with the Securities Exchange Commission and filed separately with the Commission.

such Engine was not obtained from any military or government source; and

such Engine, was not (i) involved in an accident, incident, fire or a major failure, (ii) exposed to extreme environmental conditions, severe stress or heat beyond limits, (iii) immersed in salt water or exposed to corrosive agents outside normal operation, unless, in each case, the Engine, and/or such components, parts, or materials have been restored to a serviceable condition in accordance with the original engine manufacturer’s approved technical data.

Intends that the items, technical data, and/or services provided by Contrail are solely for civil end-use and will not be used for any other purpose or end-use connected with weapons proliferation, satellite usage, military applications, chemical biological or nuclear weapons, or items capable of delivering such weapons unless prior authorization is sought and obtained from the relevant U.S. Government agencies pursuant to the Export Administration Regulations, the International Traffic in Arms Regulations or the relevant sanctions regimes maintained by the U.S. Department of the Treasury’s Office of Foreign Assets Controls;

Understands that the items, technical data and/or services will not be used for any purpose related to a military end-use by the People’s Republic of China;

Understands that the items may not be exported or re-exported for the use of a foreign vessel or aircraft unless, under the EAR, a license exception exists or no license is required to ship the items to: (a) the country in which the vessel or aircraft is located; (b) the country in which the vessel or aircraft is registered (or will be registered if under construction); and (c) the country (or foreign national) which controls, leases, or charters the vessel or aircraft;

Will not transfer, export or re-export items, technical data, and/or services provided by Contrail to destinations subject to a U.S. or U.N. arms embargo, to a destination subject to anti- terrorism export controls, or in a manner otherwise contrary to U.S. law, including, but not limited to Iran, Sudan, North Korea, Syria and Cuba;

Is not debarred, suspended, prohibited or impaired from exporting, re-exporting, receiving, purchasing, procuring, or otherwise obtaining any product, commodity of technical data regulated by any agency of the U.S. Government; and

Will use the item(s), technical data and/or service provided by Contrail for: subleased spare engine for commercial use only.

If other than MTU or an operator in the United States of America, please identify the ultimate end user(s) and country(ies) of ultimate destination of the item(s), technical data and/or services (Attach a separate sheet if necessary)

In the event there are additions or changes to the information provided above, MTU shall provide the new information to Contrail, in writing, as soon as it becomes available.

Will not be transferred to any department, branch, or agency of, or controlled by, the Chinese military;

Will not be used for any purpose related to a military end-use by the People’s Republic of China;

Will not be incorporated into a military item;

Will not be used to operate, install, maintain, repair, overhaul, or refurbish a military item;

Will not be used in the design (including design research, analyses, concepts, configuration design, integration design), pilot production schemes, assembly and testing of prototypes, or layouts related to a military item;

Will not be used in the production of a military item, including product engineering, manufacturing, integration assembly, mounting, testing, assembly, inspection, and quality assurance;

Will not be deployed as a military item, including placed in battle formation or appropriate strategic position; and

In the event there are additions or changes to the information provided above, MTU shall provide the new information to Contrail, in writing, with the order that will be thereby affected.