Exhibit 10.3(ab)
IAE PROPRIETARY INFORMATION

[exhibit103abimage1.gif]
628 Hebron Avenue, Suite 400
Glastonbury, CT 06033 USA

November 9, 2012

Mr. Mark Powers
Chief Financial Officer
JetBlue Airways Corporation
27-01 Queens Plaza North
Long Island City, NY 11101

Subject:
Side Letter No. 37 to the V2500 General Terms of Sale Agreement between JetBlue
Airways Corporation and IAE International Aero Engines AG dated May 4, 1999.

Ladies and Gentlemen:

We refer to the General Terms of Sale Agreement dated May 4, 1999 between IAE
International Aero Engines AG (“IAE”) and JetBlue Airways Corporation
(“JetBlue”), as amended from time to time, such contract being hereinafter
referred to as the "Agreement".

Unless expressly stated to the contrary, and to the extent possible, capitalized
terms used in this Side Letter Agreement No. 37 (“Side Letter No. 37”) shall
have the same meaning given to them in the Agreement. In the event of a conflict
between the terms and provisions of this Side Letter No. 37 and those of the
Agreement, this Side Letter No. 37 shall govern.

WHEREAS:
A.
The Parties wish to [***];

B.
JetBlue has agreed with the Aircraft Manufacturer to convert the aircraft model
of thirty (30) Firm Aircraft from A320 to A321 and now wishes to reflect such
changes in the Agreement;

C.
JetBlue has agreed with the Aircraft Manufacturer to certain Firm Aircraft
scheduling changes and now wishes to reflect such changes in the Agreement;

D.
JetBlue has agreed with the Aircraft Manufacturer to cancel certain Option
Aircraft and now wishes to reflect such changes in the Agreement;

E.
The Parties wish to amend certain terms and conditions with respect to the
calculations of [***] for future Firm Aircraft deliveries under the Agreement;

F.
The Parties wish to amend the terms and conditions under which JetBlue procures
the SelectOneTM Production Standard from IAE under the Agreement; and

G.
The Parties wish to [***] contained in the Agreement.

                                             
[***] Represents material which has been redacted and filed separately with the
Commission pursuant to a request for confidential treatment pursuant to Rule
24b-2 under the Securities Exchange Act of 1934, as amended.

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IAE PROPRIETARY INFORMATION

NOW, THEREFORE, the Parties hereby agree as follows:
1.
Revision to Exhibit B-1 to the Agreement

1.1
The Parties hereby agree that Exhibit B-1 to the Agreement, Aircraft Delivery
Schedule, is hereby deleted in its entirety and replaced by the revised delivery
schedule attached as Appendix 1 hereto which captures the amendments as set
forth in Sections 2, 3, 4 and 5 below.

1.2
The Parties hereby agree that Exhibit B-2 to the Agreement, Purchased Items,
Price, Escalation Formula and Delivery, is hereby deleted in its entirety and
replaced by Appendix 2 attached hereto.

2.
Aircraft [***]

2.1.
The Parties agree that of the forty-eight (48) Firm Aircraft still left to be
delivered as of the date of this Side Letter No. 37 (the “Firm Backlog
Aircraft”), the twenty-one (21) Incremental Firm Aircraft still left to be
delivered shall hereafter [***]. This Side Letter No. 37 along with Side Letter
No. 32, Side Letter No. 34 and Side Letter No. 36 together: (i) increase the
total quantity of [***] from thirty (30) to fifty-five (55) and (ii) decrease
the total quantity of [***] from sixty-five (65) to forty (40).

2.2.
[***].

2.3.
The Parties agree to [***] for Firm Aircraft No. 126, Firm Aircraft No. 127 and
Firm Aircraft No. 128 which were delivered as [***] subject to Sections 6 and 7
below. The Parties agree to [***].

3.
Aircraft Conversion

3.1.
The Parties agree that Thirty (30) Firm Backlog Aircraft, Firm Aircraft No. 133
through Firm Aircraft No. 162 inclusive as set forth in Exhibit B-1 to the
Agreement attached as Appendix 1 hereto, shall be converted from A320 Firm
Aircraft powered by V2527-A5 Engines to A321 Firm Aircraft powered by V2533-A5
Engines.

4.
Aircraft Rescheduling

4.1.
The delivery schedule for Firm Backlog Aircraft shall be deferred as set forth
in Exhibit B-1 to the Agreement attached as Appendix 1 hereto.

4.2.
The Parties agree that [***].

5.
Option Aircraft Cancellation

5.1.
The twenty-two (22) remaining 2004 Option Aircraft are hereby cancelled and
deleted from the Agreement.

6.
Escalation for Firm Backlog Aircraft Deliveries

6.1.
The [***] for Firm Backlog Aircraft shall be calculated from a base month of
[***] in accordance with the applicable formula in Exhibit B-2 as follows:

                                             
[***] Represents material which has been redacted and filed separately with the
Commission pursuant to a request for confidential treatment pursuant to Rule
24b-2 under the Securities Exchange Act of 1934, as amended.

Page 2 of 15

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IAE PROPRIETARY INFORMATION

6.1.1.
escalation shall be calculated to [***] of the Firm Backlog Aircraft, except to
the extent that [***], in which case escalation shall be calculated to [***] as
set forth in Appendix 1 hereto; or

6.1.2.
in the event that JetBlue is the sole cause of a delay in delivery of any Firm
Backlog Aircraft beyond its scheduled delivery date, escalation shall be
calculated to [***]; or

6.1.3.
in the event that IAE is the sole cause of a delay in delivery of any Firm
Backlog Aircraft beyond its scheduled delivery date, escalation shall be
calculated to [***]; or

6.1.4.
in the event that the Aircraft Manufacturer is the cause of a delay in the
delivery of any Firm Backlog Aircraft beyond its scheduled delivery date (and
such delay is not due to the acts, omissions or request of JetBlue, escalation
shall be calculated to [***].

Notwithstanding the foregoing, in no event shall [***] of all pricing and
credits for any Firm Backlog Aircraft [***] as set forth in Appendix1 hereto.
6.2.
Notwithstanding Clause 6.1 above, for the period beginning January 1, 2003 and
ending December 31, 20[***], escalation for all pricing and credits for Firm
Backlog Aircraft as calculated by the applicable escalation formula in Exhibit
B-2 shall be [***], provided that for any year in which escalation calculated by
the formula in Exhibit B [***].

6.3.
Notwithstanding anything to the contrary in the Agreement, upon delivery of each
Firm Backlog Aircraft, IAE will, as of the respective dates of delivery of each
of the Firm Backlog Aircraft delivered to and accepted by JetBlue, calculate
[***]:

6.4.1.
The Deemed Shipset Price (as defined below) escalated in accordance with Clause
6.1 above; [***]

6.4.2.
The Deemed Shipset Price escalated in accordance with Clause 6.1 above [***].

IAE will [***]. For the purposes of administering this provision, the “Deemed
Shipset Price” is as follows:
Aircraft (Engine) Type
Deemed Shipset Price ([***])
A319-100 (V2524-A5)
US$[***]
A320-200 (V2527-A5)
US$[***]
A321-100 (V2533-A5)
US$$[***]

6.4.
Clause d of Side Letter No. 25, Credits and Late Delivery Period, is hereby
deleted in its entirety from Side Letter No. 25.

6.5.
Clause e of Side Letter No. 25, Limitation to Late Delivery Period, is hereby
deleted in its entirety from Side Letter No. 25.

7.
Amendments to SelectOneTM Terms and Conditions

7.1.
Clause 1.2 of Section 1 of Side Letter No. 21, Definitions, is hereby deleted in
its entirety from Side Letter No. 21 and replaced with the following:

[***] Represents material which has been redacted and filed separately with the
Commission pursuant to a request for confidential treatment pursuant to Rule
24b-2 under the Securities Exchange Act of 1934, as amended.

Page 3 of 15

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IAE PROPRIETARY INFORMATION

“1.2
“SelectOne™ Engines” shall mean each V2500-A5 Engines in which the SelectOne™
Production Standard has been incorporated at production.”

7.2.
Section 2 of Side Letter No. 21, Purchase of SelectOneTM Engines, is hereby
deleted in its entirety from Side Letter No. 21 and replaced with the following:

“2.    Purchase of SelectOne™ Engines
2.1
JetBlue shall pay IAE for each SelectOneTM Engine as follows:

2.1.1
For each SelectOne™ Engine originally installed from new on SelectOne™ Eligible
Aircraft delivered to JetBlue on or after the SelectOne™ Production Date
(“SelectOne™ Installed Engine”), [***] (US$[***]) [***] US$ per SelectOne™
Installed Engine (the “SelectOne™ Purchase Price”);

2.1.2
For each SelectOne™ Production Standard Spare Engine (“SelectOne™ Spare
Engine”), the SelectOne™ Purchase Price.

2.2
In addition to the SelectOne™ Purchase Price, JetBlue will also pay for each
SelectOneTM Eligible Aircraft the following amounts, as applicable (the
“[***]”):

2.2.1
[***] (US$[***]) in [***] US$ per SelectOneTM Eligible Aircraft delivered with
V2527-A5 rated SelectOneTM; or

2.2.2
[***] (US$[***]) in [***] US$ per SelectOneTM Eligible Aircraft delivered with
V2533-A5 rated SelectOneTM Engines.

2.3
The Parties agree that for each SelectOneTM Eligible Aircraft delivered to
JetBlue, the [***] provided to JetBlue for such aircraft shall be [***],
escalated in accordance in Section 2.4 below.

2.4
The escalation of each SelectOne™ Purchase Price and [***] shall be calculated
in accordance with Section 6 of Side Letter No. 37.”

7.3.
Section 3 of Side Letter No. 21, [***], is hereby deleted in its entirety from
Side Letter No. 21 and replaced with the following:

“3.    [Reserved]”
7.4.
Section 4 of Side Letter No. 21, [***], is hereby deleted in its entirety from
Side Letter No. 21 and replaced with the following:

“4.    [Reserved]”
7.5.
Section 3 of Exhibit A to Side Letter No.21, [***], is hereby deleted in its
entirety and replaced with the following:

“3.    SelectOneTM Purchase Price

3.1
JetBlue shall pay IAE for each SelectOneTM Engine as follows:

[***] Represents material which has been redacted and filed separately with the
Commission pursuant to a request for confidential treatment pursuant to Rule
24b-2 under the Securities Exchange Act of 1934, as amended.

Page 4 of 15

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IAE PROPRIETARY INFORMATION

3.1.1
For each SelectOne™ Engine originally installed from new on SelectOne™ Eligible
Aircraft delivered to JetBlue on or after the SelectOne™ Production Date
(“SelectOne™ Installed Engine”), [***] Dollars (US$[***]) in [***]US$ per
SelectOne™ Installed Engine (the “SelectOne™ Purchase Price”);

3.1.2
For each SelectOne™ Production Standard Spare Engine (“SelectOne™ Spare
Engine”), the SelectOne™ Purchase Price.

3.2
The SelectOne™ Purchase Price shall be escalated from a base month of [***] in
accordance with the formula in Exhibit A-1 hereto to [***]. To the extent that
JetBlue [***].

3.3
Notwithstanding Clause 3.2 above, for the period beginning January 1, 2005 and
ending December 31, 20[***], escalation for the SelectOne™ Purchase Price as
calculated in accordance with the formula in Exhibit A-1 hereto shall be [***],
provided that for any year in which escalation calculated by the formula in
Exhibit A-1 [***].

3.4
For the avoidance of doubt, the pricing information provided in this Section 3
has been reproduced in its entirety from the pricing information contained in
Section 2.1 to Side Letter No. 21, as amended from time to time.”

7.6.
The Parties agree that as of the date of this Side Letter No. 37, [***] as set
forth in Sections 3 and 4 of Side Letter No. 21 is null and void and JetBlue
hereby [***].

8.
Removal of [***]

8.1.
[***], is hereby deleted in its entirety from [***]

8.2.
The Parties agree that as of the date of this Side Letter No. 37, [***] as set
forth in [***] is [***] for Engines delivered to JetBlue at any time under the
Agreement.

9.
Miscellaneous

9.1.
This Side Letter No. 37 is not, and shall not be construed as, a waiver of
either Party’s rights or remedies.

9.2.
This Side Letter No. 37 contains matters of a confidential and proprietary
nature and is delivered on the express condition that its terms shall not be
disclosed to any third party or reproduced in whole or in part for anyone other
than the parties hereto without the other party's prior written consent, unless
otherwise stated herein.

9.3.
This Side Letter No. 37 constitutes a valid, legal, binding obligation. This
Side Letter No. 37 shall be construed and interpreted in accordance with the
laws of the State of Connecticut, United States of America with the exception of
its conflict of law provisions.

9.4.
This Side Letter No. 37 may be executed in one or more counterparts, each of
which when so executed and delivered shall be an original but shall constitute
one and the same instrument.

[***] Represents material which has been redacted and filed separately with the
Commission pursuant to a request for confidential treatment pursuant to Rule
24b-2 under the Securities Exchange Act of 1934, as amended.

Page 5 of 15

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IAE PROPRIETARY INFORMATION

Except as expressly amended by this Side Letter No. 37, all provisions of the
Agreement (as amended from time to time by various side letters and amendments)
remain in full force and effect.

Very truly yours,
Agreed to and accepted on behalf of
IAE International Aero Engines AG
JetBlue Airways Corporation
/s/ Debarshi Mandal______________ _
By
/s/ Mark D. Powers__________________
By
Debarshi Mandal__________________
Name
Mark D. Powers_____________________
Name
Commercial Manager_____________ _
Title
Chief Financial Officer________________
Title

Page 6 of 15

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IAE PROPRIETARY INFORMATION

APPENDIX 1

Exhibit B-1

Aircraft Delivery Schedule

As of November 2012
____________________________________________________________________________________
Glossary Notes:
•
R denotes the Incremental Firm Aircraft that will be treated as [***] in
accordance with Section 2 of Side Letter No. 37.

•
* denotes Firm Aircraft that have received or will receive the $[***] ([***])$)
spare parts credit as set forth in Section 7 of Side Letter No. 13 or Section 7
of Side Letter No. 17, as applicable, and as amended by Side Letter No. 25.

•
** denotes Firm Aircraft that have received or will receive the $[***] ([***]$)
spare parts credit as set forth in Section 7 of Side Letter No. 13 or Section 7
of Side Letter No. 17, as applicable, and as amended by Side Letter No. 25.

•
† denotes Firm Aircraft that have received or will receive the both the $[***]
([***]$) and $[***] ([***]$) the spare parts credits and as set forth in Section
7 of Side Letter No. 13 or Section 7 of Side Letter No. 17, as applicable, and
as amended by Side Letter No. 25.

•
Delivered Aircraft are indicated by italics typeface.

•
Applicable escalation formulae, indicated for the calculation of Fleet
Introductory Assistance credits, are in accordance with Side Letter No. 13 and
Side Letter No. 17 to the Agreement, as amended by Side Letter No. 25 to the
Agreement.

____________________________________________________________________________________

Rank No.
Firm Aircraft Category
Aircraft
Type
Contracted
Month
Contracted
Year
Applicable
Escalation
 
No. 1
Existing Firm Aircraft
A320
[***]
2,000
Formula I
 
No. 2
Existing Firm Aircraft
A320
[***]
2,000
Formula I
 
No. 3
Existing Firm Aircraft
A320
[***]
2,000
Formula I
 
No. 4
Existing Firm Aircraft
A320
[***]
2,000
Formula I
 
No. 5
Existing Firm Aircraft
A320
[***]
2,000
Formula I
 
No. 6
Existing Firm Aircraft
A320
[***]
2,000
Formula I
 
No. 7
Existing Firm Aircraft
A320
[***]
2,001
Formula I
 
No. 8
Existing Firm Aircraft
A320
[***]
2,001
Formula I
 
No. 9
Existing Firm Aircraft
A320
[***]
2,001
Formula I
 
No. 10
Existing Firm Aircraft
A320
[***]
2,001
Formula I
 
No. 11
Existing Firm Aircraft
A320
[***]
2,001
Formula I
 
No. 12
Existing Firm Aircraft
A320
[***]
2,001
Formula I
 
No. 13
Existing Firm Aircraft
A320
[***]
2,001
Formula I
 
No. 14
Existing Firm Aircraft
A320
[***]
2,002
Formula I
 
No. 15
Existing Firm Aircraft
A320
[***]
2,002
Formula I
 
No. 16
Existing Firm Aircraft
A320
[***]
2,002
Formula I
 
No. 17
Existing Firm Aircraft
A320
[***]
2,002
Formula I
 
No. 18
Existing Firm Aircraft
A320
[***]
2,002
Formula I
 
No. 19
Existing Firm Aircraft
A320
[***]
2,002
Formula I
 

                                               
[***] Represents material which has been redacted and filed separately with the
Commission pursuant to a request for confidential treatment pursuant to Rule
24b-2 under the Securities Exchange Act of 1934, as amended.

Page 7 of 15

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IAE PROPRIETARY INFORMATION

Rank No.
Firm Aircraft Category
Aircraft
Type
Contracted
Month
Contracted
Year
Applicable
Escalation
 
No. 20
Existing Firm Aircraft
A320
[***]
2002
Formula I
 
No. 21
Existing Firm Aircraft
A320
[***]
2002
Formula I
 
No. 22
Existing Firm Aircraft
A320
[***]
2002
Formula I
 
No. 23
Existing Firm Aircraft
A320
[***]
2002
Formula I
 
No. 24
Existing Firm Aircraft
A320
[***]
2002
Formula I
 
No. 25
Existing Firm Aircraft
A320
[***]
2002
Formula I
 
No. 26
Existing Firm Aircraft
A320
[***]
2002
Formula I
 
No. 27
Existing Firm Aircraft
A320
[***]
2002
Formula I
 
No. 28
Existing Firm Aircraft
A320
[***]
2002
Formula I
 
No. 29
Existing Firm Aircraft
A320
[***]
2002
Formula I
 
No. 30
Existing Firm Aircraft
A320
[***]
2003
Formula I
 
No. 31
Existing Firm Aircraft
A320
[***]
2003
Formula I
 
No. 32
Existing Firm Aircraft
A320
[***]
2003
Formula I
 
No. 33
Existing Firm Aircraft
A320
[***]
2003
Formula I
 
No. 34
Existing Firm Aircraft
A320
[***]
2003
Formula I
 
No. 35
Existing Firm Aircraft
A320
[***]
2003
Formula I
 
No. 36
Existing Firm Aircraft
A320
[***]
2003
Formula I
 
No. 37
Existing Firm Aircraft
A320
[***]
2003
Formula I
 
No. 38
Existing Firm Aircraft
A320
[***]
2003
Formula I
*
No. 39
Existing Firm Aircraft
A320
[***]
2003
Formula I
 
No. 40
Existing Firm Aircraft
A320
[***]
2003
Formula I
 
No. 41
Existing Firm Aircraft
A320
[***]
2003
Formula I
 
No. 42
Existing Firm Aircraft
A320
[***]
2003
Formula I
 
No. 43
Existing Firm Aircraft
A320
[***]
2003
Formula I
*
No. 44
Existing Firm Aircraft
A320
[***]
2003
Formula I
 
No. 45
Existing Firm Aircraft
A320
[***]
2004
Formula I
 
No. 46
Existing Firm Aircraft
A320
[***]
2004
Formula I
 
No. 47
Existing Firm Aircraft
A320
[***]
2004
Formula I
 
No. 48
Existing Firm Aircraft
A320
[***]
2004
Formula I
*
No. 49
Existing Firm Aircraft
A320
[***]
2004
Formula I
 
No. 50
Existing Firm Aircraft
A320
[***]
2004
Formula I
 
No. 51
Existing Firm Aircraft
A320
[***]
2004
Formula I
 
No. 52
Existing Firm Aircraft
A320
[***]
2004
Formula I
 
No. 53
Existing Firm Aircraft
A320
[***]
2004
Formula I
*
No. 54
Existing Firm Aircraft
A320
[***]
2004
Formula I
 
No. 55
Incremental Firm Aircraft
A320
[***]
2004
Formula I
 
No. 56
Existing Firm Aircraft
A320
[***]
2004
Formula I
 
No. 57
Existing Firm Aircraft
A320
[***]
2004
Formula I
 
No. 58
Existing Firm Aircraft
A320
[***]
2004
Formula I
*
No. 59
Incremental Firm Aircraft
A320
[***]
2004
Formula I
 

                                               
[***] Represents material which has been redacted and filed separately with the
Commission pursuant to a request for confidential treatment pursuant to Rule
24b-2 under the Securities Exchange Act of 1934, as amended.

Page 8 of 15

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IAE PROPRIETARY INFORMATION

Rank No.
Firm Aircraft Category
Aircraft
Type
Contracted
Month
Contracted
Year
Applicable
Escalation
 
No. 60
Existing Firm Aircraft
A320
[***]
2005
Formula I
 
No. 61
Existing Firm Aircraft
A320
[***]
2005
Formula I
 
No. 62
Incremental Firm Aircraft
A320
[***]
2005
Formula I
 
No. 63
Existing Firm Aircraft
A320
[***]
2005
Formula I
*
No. 64
Existing Firm Aircraft
A320
[***]
2005
Formula I
 
No. 65
Existing Firm Aircraft
A320
[***]
2005
Formula I
 
No. 66
Existing Firm Aircraft
A320
[***]
2005
Formula I
 
No. 67
Incremental Firm Aircraft
A320
[***]
2005
Formula I
 
No. 68
Existing Firm Aircraft
A320
[***]
2005
Formula I
*
No. 69
Existing Firm Aircraft
A320
[***]
2005
Formula I
 
No. 70
Existing Firm Aircraft
A320
[***]
2005
Formula I
 
No. 71
Incremental Firm Aircraft
A320
[***]
2005
Formula I
**
No. 72
Existing Firm Aircraft
A320
[***]
2005
Formula I
 
No. 73
Existing Firm Aircraft
A320
[***]
2005
Formula I
*
No. 74
Incremental Firm Aircraft
A320
[***]
2005
Formula I
 
No. 75
Incremental Firm Aircraft
A320
[***]
2005
Formula I
 
No. 76
2004 Incremental Aircraft
A320
[***]
2006
Formula II
 
No. 77
Existing Firm Aircraft
A320
[***]
2006
Formula I
 
No. 78
Incremental Firm Aircraft
A320
[***]
2006
Formula I
*
No. 79
Incremental Firm Aircraft
A320
[***]
2006
Formula I
 
No. 80
Existing Firm Aircraft
A320
[***]
2006
Formula I
 
No. 81
Incremental Firm Aircraft
A320
[***]
2006
Formula I
**
No. 82
Existing Firm Aircraft
A320
[***]
2006
Formula I
 
No. 83
Incremental Firm Aircraft
A320
[***]
2006
Formula I
*
No. 84
Incremental Firm Aircraft
A320
[***]
2006
Formula I
 
No. 85
Existing Firm Aircraft
A320
[***]
2006
Formula I
 
No. 86
Incremental Firm Aircraft
A320
[***]
2006
Formula I
 
No. 87
Incremental Firm Aircraft
A320
[***]
2006
Formula I
 
No. 88
Existing Firm Aircraft
A320
[***]
2006
Formula I
*
No. 89
Incremental Firm Aircraft
A320
[***]
2006
Formula I
**
No. 90
Incremental Firm Aircraft
A320
[***]
2006
Formula I
 
No. 91
2004 Incremental Aircraft
A320
[***]
2006
Formula II
 
No. 92
Existing Firm Aircraft
A320
[***]
2007
Formula I
 
No. 93
Existing Firm Aircraft
A320
[***]
2007
Formula I
*
No. 94
2004 Incremental Aircraft
A320
[***]
2007
Formula II
 
No. 95
Existing Firm Aircraft
A320
[***]
2007
Formula I
 
No. 96
Existing Firm Aircraft
A320
[***]
2007
Formula I
 
No. 97
Existing Firm Aircraft
A320
[***]
2007
Formula I
 
No. 98
Incremental Firm Aircraft
A320
[***]
2007
Formula I
*
No. 99
Incremental Firm Aircraft
A320
[***]
2007
Formula I
 

                                            
[***] Represents material which has been redacted and filed separately with the
Commission pursuant to a request for confidential treatment pursuant to Rule
24b-2 under the Securities Exchange Act of 1934, as amended.

Page 9 of 15

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IAE PROPRIETARY INFORMATION

Rank No.
Firm Aircraft Category
Aircraft
Type
Contracted
Month
Contracted
Year
Applicable
Escalation
 
No. 100
Incremental Firm Aircraft
A320
[***]
2007
Formula I
 
No. 101
Incremental Firm Aircraft
A320
[***]
2007
Formula I
**
No. 102
Incremental Firm Aircraft
A320
[***]
2007
Formula I
 
No. 103
Incremental Firm Aircraft
A320
[***]
2007
Formula I
*
No. 104
Incremental Firm Aircraft
A320
[***]
2008
Formula I
 
No. 105
Incremental Firm Aircraft
A320
[***]
2008
Formula I
 
No. 106
Incremental Firm Aircraft
A320
[***]
2008
Formula I
**
No. 107
Incremental Firm Aircraft
A320
[***]
2008
Formula I
 
No. 108
Incremental Firm Aircraft
A320
[***]
2008
Formula I
*
No. 109
Incremental Firm Aircraft
A320
[***]
2008
Formula I
 
No. 110
Incremental Firm Aircraft
A320
[***]
2008
Formula I
 
No. 111
Incremental Firm Aircraft
A320
[***]
2008
Formula I
**
No. 112
Incremental Firm Aircraft
A320
[***]
2008
Formula I
 
No. 113
Incremental Firm Aircraft
A320
[***]
2008
Formula I
*
No. 114
Incremental Firm Aircraft
A320
[***]
2008
Formula I
 
No. 115
Incremental Firm Aircraft
A320
[***]
2008
Formula I
 
No. 116
Incremental Firm Aircraft
A320
[***]
2009
Formula I
**
No. 117
Incremental Firm Aircraft
A320
[***]
2009
Formula I
 
No. 118
Incremental Firm Aircraft
A320
[***]
2009
Formula I
*
No. 119
Incremental Firm Aircraft
A320
[***]
2010
Formula I
 
No. 120
Incremental Firm Aircraft
A320
[***]
2010
Formula I
 
No. 121
Incremental Firm Aircraft
A320
[***]
2010
Formula I
**
No. 122
2004 Incremental Aircraft
A320
[***]
2011
Formula II
 
No. 123
2004 Incremental Aircraft
A320
[***]
2011
Formula II
†
No. 124
2004 Incremental Aircraft
A320
[***]
2011
Formula II
 
No. 125
2004 Incremental Aircraft
A320
[***]
2011
Formula II
 
No. 126
2004 Incremental Aircraft
A320
[***]
2012
Formula II
R
No. 127
2004 Incremental Aircraft
A320
[***]
2012
Formula II
R
No. 128
2004 Incremental Aircraft
A320
[***]
2012
Formula II
R† 
No. 129
2004 Incremental Aircraft
A320
[***]
2012
Formula II
R
No. 130
2004 Incremental Aircraft
A320
[***]
2013
Formula II
R
No. 131
2004 Incremental Aircraft
A320
[***]
2013
Formula II
R
No. 132
2004 Incremental Aircraft
A320
[***]
2013
Formula II
R
No. 133
2004 Incremental Aircraft
A321
[***]
2013
Formula II
†
No. 134
2004 Incremental Aircraft
A321
[***]
2013
Formula II
 
No. 135
2004 Incremental Aircraft
A321
[***]
2013
Formula II
 
No. 136
2004 Incremental Aircraft
A321
[***]
2013
Formula II
 
No. 137
2004 Incremental Aircraft
A321
Year
2014
Formula II
R
No. 138
2004 Incremental Aircraft
A321
Year
2014
Formula II
R† 

                                            
[***] Represents material which has been redacted and filed separately with the
Commission pursuant to a request for confidential treatment pursuant to Rule
24b-2 under the Securities Exchange Act of 1934, as amended.

Page 10 of 15

--------------------------------------------------------------------------------

IAE PROPRIETARY INFORMATION

Rank No.
Firm Aircraft Category
Aircraft
Type
Contracted
Month
Contracted
Year
Applicable
Escalation
 
No. 139
2004 Incremental Aircraft
A321
Year
2014
Formula II
R
No. 140
2004 Incremental Aircraft
A321
Year
2014
Formula II
R
No. 141
2004 Incremental Aircraft
A321
Year
2014
Formula II
R
No. 142
2004 Incremental Aircraft
A321
Year
2014
Formula II
R
No. 143
2004 Incremental Aircraft
A321
Year
2014
Formula II
†
No. 144
2004 Incremental Aircraft
A321
Year
2014
Formula II
 
No. 145
2004 Incremental Aircraft
A321
Year
2014
Formula II
R
No. 146
2004 Incremental Aircraft
A321
Year
2015
Formula II
 
No. 147
2004 Incremental Aircraft
A321
Year
2015
Formula II
 
No. 148
2004 Incremental Aircraft
A321
Year
2015
Formula II
†
No. 149
2004 Incremental Aircraft
A321
Year
2015
Formula II
 
No. 150
2004 Incremental Aircraft
A321
Year
2015
Formula II
 
No. 151
2004 Incremental Aircraft
A321
Year
2015
Formula II
 
No. 152
2004 Incremental Aircraft
A321
Year
2015
Formula II
 
No. 153
2004 Incremental Aircraft
A321
Year
2015
Formula II
R† 
No. 154
2004 Incremental Aircraft
A321
Year
2015
Formula II
 
No. 155
2004 Incremental Aircraft
A321
Year
2015
Formula II
 
No. 156
2004 Incremental Aircraft
A321
Year
2016
Formula II
 
No. 157
2004 Incremental Aircraft
A321
Year
2016
Formula II
 
No. 158
2004 Incremental Aircraft
A321
Year
2016
Formula II
 
No. 159
2004 Incremental Aircraft
A321
Year
2016
Formula II
 
No. 160
2004 Incremental Aircraft
A321
Year
2016
Formula II
 
No. 161
2004 Incremental Aircraft
A321
Year
2016
Formula II
 
No. 162
2004 Incremental Aircraft
A321
Year
2016
Formula II
R
No. 163
2004 Incremental Aircraft
A320
Year
2016
Formula II
 
No. 164
2004 Incremental Aircraft
A320
Year
2016
Formula II
 
No. 165
2004 Incremental Aircraft
A320
Year
2016
Formula II
 
No. 166
2004 Incremental Aircraft
A320
Year
2017
Formula II
 
No. 167
2004 Incremental Aircraft
A320
Year
2017
Formula II
 
No. 168
2004 Incremental Aircraft
A320
Year
2017
Formula II
 
No. 169
2004 Incremental Aircraft
A320
Year
2017
Formula II
R
No. 170
2004 Incremental Aircraft
A320
Year
2017
Formula II
R
No. 171
2004 Incremental Aircraft
A320
Year
2017
Formula II
R
No. 172
2004 Incremental Aircraft
A320
Year
2017
Formula II
R
No. 173
2004 Incremental Aircraft
A320
Year
2017
Formula II
R

                                            
[***] Represents material which has been redacted and filed separately with the
Commission pursuant to a request for confidential treatment pursuant to Rule
24b-2 under the Securities Exchange Act of 1934, as amended.

Page 11 of 15

--------------------------------------------------------------------------------

IAE PROPRIETARY INFORMATION

APPENDIX 2

Exhibit B-2

Purchased Items, Price, Escalation Formula and Delivery

As of November 2012
____________________________________________________________________________________
Glossary Notes:
•
Delivered Firm Spare Engines are indicated by italics typeface

•
Applicable escalation formulae, indicated for the calculation of Spare Engine
pricing and credits, are in accordance with Side Letter No. 13 and Side Letter
No. 17 to the Agreement, as amended by Side Letter No. 25 to the Agreement.

____________________________________________________________________________________

 
Rank No.
Engine Model
Basic Contract Price (US$)
Base Month
Qty
Applicable
Escalation
Contracted
Delivery Date
  
No. 1
V2527-A5
[***]
[***]
1
Formula I
[***]-99
 
No. 2
V2527-A5
[***]
[***]
1
Formula I
[***]-00
 
No. 3
V2527-A5
[***]
[***]
1
Formula I
[***]-01
 
No. 4
V2527-A5
[***]
[***]
1
Formula I
[***]-02
 
No. 5
V2527-A5
[***]
[***]
1
Formula I
[***]-02
 
No. 6
V2527-A5
[***]
[***]
1
Formula I
[***]-03
 
No. 7
V2527-A5
[***]
[***]
1
Formula I
[***]-04
 
No. 8
V2527-A5
[***]
[***]
1
Formula I
[***]-05
 
No. 9
V2527-A5
[***]
[***]
1
Formula I
[***]-05
 
No. 10
V2527-A5
[***]
[***]
1
Formula II
[***]-06
 
No. 11
V2527-A5
[***]
[***]
1
Formula I
[***]-06
 
No. 12
V2527-A5
[***]
[***]
1
Formula II
[***]-07
 
No. 13
V2527-A5
[***]
[***]
1
Formula I
[***]-07
 
No. 14
V2527-A5
[***]
[***]
1
Formula I
[***]-07
 
No. 15
V2527-A5
[***]
[***]
1
Formula II
[***]-07
 
No. 16
V2527-A5
[***]
[***]
1
Formula I
[***]-07
 
No. 17
V2527-A5
[***]
[***]
1
Formula I
[***]-08
 
No. 18
V2527-A5
[***]
[***]
1
Formula I
[***]-08
 
No. 19
V2527-A5
[***]
[***]
1
Formula I
[***]-09
 
No. 20
V2527-A5
[***]
[***]
1
Formula I
[***]-10
 
No. 21
V2527-A5
[***]
[***]
1
Formula II
[***]-10
 
No. 22
V2527-A5
[***]
[***]
1
Formula I
[***]-10
 
No. 23
V2527-A5
[***]
[***]
1
Formula I
[***]-11
 
No. 24
V2533-A5
[***]
[***]
1
Formula II
[***]-11
 
No. 25
V2533-A5
[***]
[***]
1
Formula II
[***]-11
 
No. 26
V2533-A5
[***]
[***]
1
Formula II
[***]-11
 
No. 27
V2533-A5
[***]
[***]
1
Formula II
[***]-12
 
No. 28
V2533-A5
[***]
[***]
1
Formula II
[***]-12

                                                        
[***] Represents material which has been redacted and filed separately with the
Commission pursuant to a request for confidential treatment pursuant to Rule
24b-2 under the Securities Exchange Act of 1934, as amended.

Page 12 of 15

--------------------------------------------------------------------------------

IAE PROPRIETARY INFORMATION

ESCALATION FORMULA I

1.
Any unit base price or other sum expressed to be subject to escalation from a
base month to a month of delivery or other date of determination in accordance
with the IAE Escalation Formula will be subject to escalation in accordance with
the following formula:

P = Pb ( [***] L + [***] M + [***] E )
Lo     Mo     Eo

Where:

P = the invoiced purchase price or escalated sum rounded to the nearest U.S.
Dollar

Pb = unit base price or other sum.

Lo = the “North American Industry Classification System (NAICS) Wages and
Salaries for Aircraft Manufacturing (NAICS Code 336411), CIU2023211000000I” as
published quarterly by the Bureau of Labor Statistics, U.S. Department of Labor
for the Labor for the month preceding the base month by four months.

L = the “North American Industry Classification System (NAICS) Wages and
Salaries for Aircraft Manufacturing (NAICS Code 336411), CIU2023211000000I” as
published quarterly by the Bureau of Labor Statistics, U.S. Department of Labor
for the month preceding the month of delivery or other date of determination by
four months.

Mo = the “Producer Price Index, Code 10, for Metals and Metal Products”
published by the Bureau of Labor Statistics in the U.S. Department of Labor for
the month preceding the base month by four months.

M = the “Producer Price Index, Code 10, for Metals and Metal Products” for the
month preceding the base month by four months.

Eo = the “Producer Price Index, Code 5, for Fuel and Related Products and Power”
published by the Bureau of Labor Statistics in the U.S. Department of Labor for
the month preceding the base month by four months.

E = the “Producer Price Index, Code 5, for Fuel and Related Products and Power”
for the month preceding the base month by four months.

The values of the factors [***] L + [***] M + [***] E
Lo     Mo     Eo

Respectively, shall be determined to the nearest fourth decimal place. If the
fifth decimal is five or more, the fourth decimal place shall be raised to the
next higher number.

If the U.S. Department of Labor ceases to publish the above statistics or
modifies the basis of their calculation, then IAE may substitute any officially
recognized and substantially equivalent statistics.

The Basic Contract Prices contained in this Exhibit B are subject to escalation
from a Base Month of [***] to the month of delivery using using Lo, Mo and Eo
values for September 2002.

                                                        
[***] Represents material which has been redacted and filed separately with the
Commission pursuant to a request for confidential treatment pursuant to Rule
24b-2 under the Securities Exchange Act of 1934, as amended.

Page 13 of 15

--------------------------------------------------------------------------------

IAE PROPRIETARY INFORMATION

If the application of the formula contained in this Exhibit B results in a
Purchase Price which is lower than the Basic Contract Price, the Basic Contract
Price will be deemed to be the Purchase Price for such Supplies.

ESCALATION FORMULA II
1.
Any unit base price or other sum expressed to be subject to escalation from a
base month to a month of delivery or other date of determination in accordance
with the IAE Escalation Formula will be subject to escalation in accordance with
the following formula:

Pi
=    (Pb+F) x CPI where:

Pi
=    the invoiced purchase price or escalated sum rounded to the nearest U.S.
Dollar.

Pb    =    unit base price or other sum.

F    =    [***] (N)(Pb)

N    =    the calendar year of scheduled delivery or other date of determination
minus 2003

CPI    =    [***] (L) + [***] (M)

L    =    Labor Ratio defined below

M    =    Material Ratio defined below

IAE’s Composite Price Index (“CPI”) is the sum of [***] percent of the Labor
ratio and [***] percent of the Material Ratio, with the sum rounded to the
nearest ten thousandth.
The quarterly value published for the Employment Cost Index will be deemed to
apply to each month of the quarter.
The Labor Ratio is the “North American Industry Classification System (NAICS)
Wages and Salaries for Aircraft Manufacturing (NAICS Code 336411),
CIU2023211000000I” as published quarterly by the Bureau of Labor Statistics,
U.S. Department of Labor for the arithmetic average of the fifth, sixth and
seventh months (rounded to the nearest tenth) preceding the month of scheduled
delivery for each engine/equipment; divided by the value of “North American
Industry Classification System (NAICS) Wages and Salaries for Aircraft
Manufacturing (NAICS Code 336411), CIU2023211000000I” for the arithmetic average
of the fifth, sixth and seventh months (rounded to the nearest tenth) preceding
the Base Month. To be clear the quarterly value of CIU2023211000000I will apply
to each month of a given quarter.

The Material Ratio is the “Producer Price Index, Industrial Commodities,
WPU03thru15”, as published monthly by the Bureau of Labor Statistics, U.S.
Department of Labor, for the arithmetic average of the fifth, sixth and seventh
months (rounded to the nearest tenth) preceding the month of scheduled delivery
for each engine/equipment; divided by the value for Industrial Commodities for
the arithmetic average of the fifth, sixth and seventh months (rounded to the
nearest tenth) preceding the Base Month.

For a given month, the escalation shall be computed by using the applicable
Index value, which the Bureau has published as the time of delivery or other
date of determination.

                                                        
[***] Represents material which has been redacted and filed separately with the
Commission pursuant to a request for confidential treatment pursuant to Rule
24b-2 under the Securities Exchange Act of 1934, as amended.

Page 14 of 15

--------------------------------------------------------------------------------

IAE PROPRIETARY INFORMATION

2.
If the U.S. Department of Labor changes the base year for determination of the
Index values as defined above, such re-based values will be incorporated in the
escalation calculation.

3.
If the U.S. Department of Labor revises the methodology used for the
determination of the values to be used to determine the CPI or, for any reason,
has not released values needed to determine the CPI, IAE, in its sole
discretion, shall select a substitute for such values from data published by the
Bureau of Labor Statistics or otherwise make revisions to the escalation formula
such that the escalation will as closely as possible approximate the result that
would have been attained by continuing the use of the original escalation
formula and values as they may have fluctuated during the applicable time
period.

4.
The invoiced purchase price, which in no event shall be less than the unit base
price, shall be the final price. If the calculated sum of L + M is less than
1.0000, then the value of the sum is adjusted to 1.0000.

Page 15 of 15