lmi10k031509ex9.htm


    Exhibit 10.9


       

       

      


      MASTER
AGREEMENT

      


      


      


      between

      


      


      


      APB
WINGLETS COMPANY, LLC.,

      D.B.A.
AVIATION PARTNERS BOEING

      


      


      


      and

      


      


      


      LMI
AEROSPACE, INC.

      


      


      


      


      


      


      


      


      APB-LMI-001

      


      


      
        
          
             


          

          
             


            
              

            

          

          
             


          

        

      

      


      TABLE OF
CONTENTS

      TITLE
PAGE

      TABLE OF
CONTENTS

      AMENDMENT
PAGE

      RECITAL
PAGE

      


      
        	
                1.0

              	
                DEFINITIONS

              	
                1

              
	 
      	 
      	 
      
	
                2.0

              	
                TERM
      OF AGREEMENT, ORDERS

              	
                3

              
	 
      	
                2.1

              	
                Term
      of Agreement

              	
                3

              
	 
      	
                2.2

              	
                Follow-on
      Models

              	
                3

              
	 
      	
                2.3

              	
                Order
      Quantity

              	
                3

              
	 
      	
                2.4

              	
                Issuance
      of Orders

              	
                4

              
	 
      	
                2.5

              	
                Orders
      Containing Additional Terms

              	
                4

              
	 
      	
                2.6

              	
                Written
      Authorization to Proceed

              	
                4

              
	 
      	
                2.7

              	
                Rejection
      of Purchase Order

              	
                5

              
	 
      	 
      	 
      	 
      
	
                3.0

              	
                TITLE
      AND RISK OF LOSS

              	
                5

              
	 
      	 
      	 
      
	
                4.0

              	
                DELIVERY
      PROCESS/INVOICE EVENT

              	
                5

              
	 
      	
                4.1

              	
                Delivery
      Requirements

              	
                5

              
	 
      	
                4.2

              	
                Delivery
      Process

              	
                5

              
	 
      	
                4.3

              	
                Shipment
      Notification

              	
                5

              
	 
      	
                4.4

              	
                Non-Excusable
      Delay

              	
                6

              
	 
      	 
      	
                4.4.1.

              	
                Delivery
      Performance

              	
                6

              
	 
      	 
      	
                4.4.2.

              	
                Notification

              	
                6

              
	 
      	 
      	
                4.4.3.

              	
                Mitigation

              	
                6

              
	 
      	 
      	
                4.4.4.

              	
                APB’s
      Rights

              	
                6

              
	 
      	
                4.5

              	
                Notice
      of Labor Disputes

              	
                7

              
	 
      	 
      	 
      	 
      
	
                5.0

              	
                ON-SITE
      REVIEW AND RESIDENT REPRESENTATIVES

              	
                7

              
	 
      	
                5.1

              	
                Review

              	
                7

              
	 
      	
                5.2

              	
                Resident
      Representatives

              	
                7

              
	 
      	 
      	 
      	 
      
	
                6.0

              	
                PAYMENT/PRICING

              	
                8

              
	 
      	
                6.1

              	
                Product
      Pricing

              	
                8

              
	 
      	
                6.2

              	
                Payment

              	
                8

              
	 
      	
                6.3

              	
                Amortization
      of Nonrecurring Price

              	
                8

              
	 
      	 
      	 
      	 
      
	
                7.0

              	
                PACKING
      AND SHIPPING

              	
                8

              
	 
      	
                7.1

              	
                Packaging

              	
                8

              
	 
      	
                7.2

              	
                General

              	
                9

              
	 
      	
                7.3

              	
                Requirements
      for each Shipment

              	
                9

              
	 
      	
                7.4

              	
                Tariff
      Declaration

              	
                9

              
	 
      	
                7.5

              	
                Unit
      Container Markings

              	
                9

              
	 
      	
                7.6

              	
                Shipping
      Container Markings

              	
                9

              
	 
      	 
      	 
      	 
      
	
                8.0

              	
                QUALITY
      ASSURANCE, INSPECTION, REJECTION, & ACCEPTANCE

              	
                10

              
	 
      	
                8.1

              	
                QA/Inspection/PMA

              	
                10

              
	 
      	
                8.2

              	
                Quality
      Management System

              	
                10

              
	 
      	 
      	
                8.2.1.

              	
                Supplier
      Quality Plan

              	
                10

              
	 
      	 
      	
                8.2.2.

              	
                Inspection

              	
                10

              


      

      


      


      
        
          
            i


          

          
            Master Agreement
No. APB-LMI-001  

            
              

            

          

          
             


          

        

      

      


      


      
        	 
      	 
      	 
      	 
      	 
      
	 
      	
                8.3

              	
                Federal
      Aviation Administration or Equivalent Government Agency

                Inspection

              	
                11

              
	 
      	
                8.4

              	
                APB’s
      Inspection, Acceptance and Rejection

              	
                11

              
	 
      	
                8.5

              	
                Certificate
      of Conformity (C of C)

              	
                12

              
	 
      	
                8.6

              	
                Airworthiness
      Tag Requirement

              	
                12

              
	 
      	
                8.7

              	
                Retention
      of Records; Compliance with Standards

              	
                12

              
	 
      	
                8.8

              	
                Digital
      Data Control System

              	
                12

              
	 
      	
                8.9

              	
                First
      Article Inspection

              	
                13

              
	 
      	
                8.10

              	
                Tool
      Control System

              	
                13

              
	 
      	
                8.11

              	
                Direct
      Sales/Regulatory Approvals

              	
                13

              
	 
      	 
      	 
      	 
      
	
                9.0

              	
                PRODUCTION
      RATE

              	
                13

              
	 
      	 
      	 
      
	
                10.0

              	
                CHANGES

              	
                13

              
	 
      	
                10.1

              	
                Change
      Orders

              	
                13

              
	 
      	
                10.2

              	
                Examination
      of Records for Changes

              	
                14

              
	 
      	
                10.3

              	
                Computation
      of Equitable Adjustment

              	
                14

              
	 
      	
                10.4

              	
                Obsolescence

              	
                14

              
	 
      	
                10.5

              	
                Configuration

              	
                14

              
	 
      	 
      	
                10.5.1

              	
                Configuration
      Changes

              	
                15

              
	 
      	
                10.6

              	
                Planning
      Schedule

              	
                15

              
	 
      	 
      	 
      
	
                11.0

              	
                ACCELERATION/DECELERATION
      AT NO COST

              	
                15

              
	 
      	 
      	 
      
	
                12.0

              	
                PRODUCT
      SUPPORT AND ASSURANCE

              	
                15

              
	 
      	
                12.1

              	
                Warranty

              	
                15

              
	 
      	
                12.2

              	
                Insurance

              	
                16

              
	 
      	 
      	
                12.2.1

              	
                Products
      and Completed Operations Liability

              	
                16

              
	 
      	 
      	
                12.2.2

              	
                Property
      Insurance

              	
                17

              
	 
      	 
      	 
      	
                12.2.2.1

              	
                Certificate
      of Insurance

              	
                17

              
	 
      	 
      	 
      	
                12.2.2.2

              	
                Notice
      of Damage or Loss

              	
                17

              
	 
      	
                12.3

              	
                Manufacturing/Design
      Indemnities

              	
                17

              
	 
      	
                12.4

              	
                Notice
      of Claim

              	
                18

              
	 
      	 
      	 
      	 
      
	
                13.0

              	
                TERMINATION
      FOR CONVENIENCE

              	
                18

              
	 
      	
                13.1

              	
                Basis
      for Termination; Notice

              	
                18

              
	 
      	
                13.2

              	
                Termination
      Instructions

              	
                18

              
	 
      	
                13.3

              	
                LMI’s
      Claim

              	
                19

              
	 
      	
                13.4

              	
                Failure
      to Submit a Claim

              	
                19

              
	 
      	
                13.5

              	
                Partial
      Termination

              	
                19

              
	 
      	
                13.6

              	
                Exclusions
      or Deductions

              	
                19

              
	 
      	
                13.7

              	
                Partial/Payment

              	
                20

              
	 
      	
                13.8

              	
                LMI’s
      Accounting Practices

              	
                20

              
	 
      	
                13.9

              	
                Records

              	
                20

              
	 
      	 
      	 
      	 
      
	
                14.0

              	
                EVENTS
      OF DEFAULT AND REMEDIES

              	
                20

              
	 
      	
                14.1

              	
                Events
      of Default

              	
                20

              
	 
      	
                14.2

              	
                Remedies

              	
                21

              


      

      


      


      
        
          
            ii


          

          
            Master
Agreement No. APB-LMI-001  

            
              

            

          

          
             


          

        

      

      


      


      
        	
                15.0

              	
                EXCUSABLE
      DELAY

              	
                22

              
	 
      	 
      	 
      
	
                16.0

              	
                SUSPENSION
      OF WORK

              	
                23

              
	 
      	 
      	 
      	 
      
	
                17.0

              	
                TERMINATION
      OR CANCELLATION AND INDEMNITY AGAINST

              	 
      
	 
      	
                SUBCONTRACTOR
      CLAIMS

              	
                23

              
	 
      	 
      	 
      
	
                18.0

              	
                ASSURANCE
      OF PERFORMANCE

              	
                23

              
	 
      	
                18.1

              	
                LMI
      to Provide Assurance

              	
                23

              
	 
      	
                18.2

              	
                Meetings
      and Information

              	
                24

              
	 
      	 
      	 
      	 
      
	
                19.0

              	
                LEAD
      TIMES

              	
                24

              
	 
      	 
      	 
      	 
      
	
                20.0

              	
                PERFORMANCE
      VISIBILITY

              	
                24

              
	 
      	 
      	 
      	 
      
	
                21.0

              	
                RESPONSIBILITY
      FOR APB PROPERTY

              	
                24

              
	 
      	 
      	 
      	 
      
	
                22.0

              	
                LIMITATION
      OF LMI’S RIGHT TO ENCUMBER ASSETS

              	
                24

              
	 
      	 
      	 
      	 
      
	
                23.0

              	
                PROPRIETARY
      INFORMATION AND MATERIALS

              	
                25

              
	 
      	
                23.1

              	
                License
      of LMI’s Background Proprietary Information and Inventions

              	
                27

              
	 
      	 
      	 
      
	
                24.0

              	
                COMPLIANCE
      WITH LAWS

              	
                28

              
	 
      	
                24.1

              	
                LMI’s
      Obligation

              	
                28

              
	 
      	
                24.2

              	
                Export
      Controls

              	
                28

              
	 
      	 
      	 
      
	
                25.0

              	
                INTEGRITY
      IN PROCUREMENT

              	
                28

              
	 
      	 
      	 
      	 
      
	
                26.0

              	
                INFRINGEMENT

              	
                28

              
	 
      	 
      	 
      	 
      
	
                27.0

              	
                NOTICES

              	
                29

              
	 
      	
                27.1

              	
                Addresses

              	
                29

              
	 
      	
                27.2

              	
                Effective
      Date

              	
                29

              
	 
      	
                27.3

              	
                Approval
      or Consent

              	
                29

              
	 
      	 
      	 
      	 
      
	
                28.0

              	
                PUBLICITY

              	
                29

              
	 
      	 
      	 
      	 
      
	
                29.0

              	
                RESPONSIBILITY
      FOR PERFORMANCE

              	
                29

              
	 
      	
                29.1

              	
                Flowdown
      of Requirements

              	
                29

              
	 
      	
                29.2

              	
                Performance
      during Disputes

              	
                30

              
	 
      	
                29.3

              	
                Disputes

              	
                30

              
	 
      	
                29.4

              	
                Subcontracting

              	
                30

              
	 
      	
                29.5

              	
                Reliance

              	
                31

              
	 
      	
                29.6

              	
                Assignment

              	
                31

              
	 
      	 
      	 
      	 
      
	
                30.0

              	
                PRODUCT
      SUPPORT

              	
                31

              
	 
      	
                30.1

              	
                Policy

              	
                31

              
	 
      	
                30.2

              	
                Scope

              	
                31

              
	 
      	
                30.3

              	
                AOG
      Response

              	
                32

              
	 
      	
                30.4

              	
                Routine/
      Class II Response

              	
                32

              
	 
      	
                30.5

              	
                Designation
      by APB

              	
                32

              
	 
      	
                30.6

              	
                Reclassifications
      or Re-exercises

              	
                32

              
	 
      	
                30.7

              	
                Spare
      Parts Pricing

              	
                32

              
	 
      	
                30.8

              	
                Packaging
      of Spare Parts

              	
                32

              
	 
      	
                30.9

              	
                Special
      Handling

              	
                33

              
	 
      	
                30.10

              	
                LMI’s
      Spares Point of Contact

              	
                33

              
	 
      	
                30.11

              	
                Communication
      Response Times

              	
                33

              
	 
      	
                30.12

              	
                General
      Product Support Requirements

              	
                33

              


      

      


      


      
        
          
            iii


          

          
            Master
Agreement No. APB-LMI-001  

            
              

            

          

          
             


          

        

      

       

      


      
        	 
      	 
      	
                30.12.1

              	
                Resolution
      of Product Warranty Claims

              	
                33

              
	 
      	 
      	
                30.12.2

              	
                Technical
      Assistance Requests-Product Manufacture

              	
                34

              
	 
      	 
      	
                30.12.3

              	
                Agreement
      to Manufacture and Sell

              	
                34

              
	 
      	 
      	 
      
	
                31.0

              	
                TOOLING

              	
                34

              
	 
      	 
      	 
      	 
      
	
                32.0

              	
                APB-OWNED
      TOOLING

              	
                34

              
	 
      	 
      	 
      	 
      
	
                33.0

              	
                STATUS
      REPORTS/REVIEWS

              	
                35

              
	 
      	 
      	 
      	 
      
	
                34.0

              	
                APB-FURNISHED
      MATERIAL AND DATA

              	
                35

              
	 
      	 
      	 
      	 
      
	
                35.0

              	
                INVENTORY
      AT CONTRACT COMPLETION

              	
                35

              
	 
      	 
      	 
      	 
      
	
                36.0

              	
                CONFIGURATION
      CONTROL OF PRODUCTS

              	
                35

              
	 
      	 
      	 
      	 
      
	
                37.0

              	
                NON-WAIVER

              	
                36

              
	 
      	 
      	 
      	 
      
	
                38.0

              	
                HEADINGS

              	
                36

              
	 
      	 
      	 
      	 
      
	
                39.0

              	
                PARTIAL
      INVALIDITY

              	
                36

              
	 
      	 
      	 
      	 
      
	
                40.0

              	
                APPLICABLE
      LAW; JURISDICTION

              	
                36

              
	 
      	 
      	 
      	 
      
	
                41.0

              	
                AMENDMENT

              	
                36

              
	 
      	 
      	 
      	 
      
	
                42.0

              	
                LIMITATION

              	
                36

              
	 
      	 
      	 
      	 
      
	
                43.0

              	
                LITIGATION

              	
                37

              
	 
      	
                43.1

              	
                Rebates

              	
                37

              
	 
      	 
      	 
      	 
      
	
                44.0

              	
                ENTIRE
      AGREEMENT/ORDER OF PRECEDENCE/SURVIVAL

              	
                37

              
	 
      	
                44.1

              	
                Entire
      Agreement

              	
                37

              
	 
      	
                44.2

              	
                Incorporated
      by Reference

              	
                37

              
	 
      	
                45.3

              	
                Order
      of Precedence

              	
                37

              
	 
      	 
      	 
      	 
      
	
                45.0

              	
                SURVIVAL

              	
                38

              


      

       

      
 

      
        
          
            iv


          

          
            Master
Agreement No. APB-LMI-001  

            
              

            

          

          
             


          

        

      

      
 

      AMENDMENTS/ADDENDUMS

      


      
        	
                Amend

                Number

              	
                Description

              	
                Date

              	
                Approval

              
	
                 
      

                 

                 

                 

                 

                 

                 

                 

                 

                 

                 

                 

                 

                 

              	 
      	 
      	 
      


      

      


       

      
        
          
            
              v


            

            
              Master
Agreement No. APB-LMI-001  

              
                

              

            

            
               


            

          

        

        
 

      

      MASTER
AGREEMENT

      


      


      THIS
MASTER AGREEMENT is entered into as of ___________, by and between LMI
AEROSPACE, INC., ("LMI') with Corporate Headquarters in St. Charles, Missouri,
doing business in Savannah, Georgia, and APB Winglets Company, LLC. ("APB"),
D.B.A. Aviation Partners Boeing, a Limited Liability Company (LLC) with its
principal office in Seattle, Washington.

      


      PREAMBLE

      


      
        	
                A.

              	
                APB
      designs, purchases, tests, certifies, installs, sells, and supports
      Blended Winglet Systems. A Blended Winglet system is a curved wingtip
      device and all associated hardware installed on Boeing commercial
      aircraft.

              


      

      


      
        	
                B.

              	
                LMI
      desires to provide procurement, manufacturing, and kitting of wing
      modification parts and assemblies for the 767-300ER/F aircraft in
      accordance with the terms of this
Agreement.

              


      

      


      Now
therefore, in consideration of the mutual covenants set forth herein, the
parties agree as follows:

      


      1.0                      DEFINITIONS

      


      The
definitions set forth below shall apply to this Agreement and any Order. Words
importing the singular number shall also include the plural number and vice
versa and reference to "including" shall mean "including but not limited
to."

      


      
        
          	
                  A.

                	
                  "Agreement"
      means this Master Agreement as amended from time to time by addendum or
      otherwise.

                
	 
      	 
      
	
                  B.

                	
                  “Aircraft"
      means airplanes modified by APB containing Product(s) supplied by LMI to
      APB under this Agreement.

                
	 
      	 
      
	
                  C.

                	
                  "Airplane-On-Ground"
      or "AOG" means the highest Spare Part priority.

                
	 	 
	
                  D.

                	
                  "APB"
      means APB Winglets Company, LLC.

                
	 
      	 
      
	
                  E.

                	
                  "APB
      Proprietary Spare" means any Spare Part which is manufactured (i) by APB,
      or (ii) to APB's detailed designs with APB's authorization or (iii) in
      whole or in part using APB's proprietary materials.

                
	 
      	 
      
	
                  F.

                	
                  "Assembly"
      means one or more machined or formed parts that are mechanically
      assembled.

                
	 
      	 
      
	
                  G.

                	
                  “Correction"
      means Repair, correction or provision of a defective Product to bring it
      into compliance with all requirements of an applicable warranty, or at
      LMI's option, replacement of such Product with a new Product that meets
      all requirements of the warranty.

                


        

         

         

        
          
            1

          

          
            Master Agreement No.
APB-LMI-001

            
              

            

          

          
            
            

          

        

         

         

        
          	
                  H.

                	
                  "Customer"
      means any owner, lessee, operator or user or designee of such owner,
      lessee or operator of an aircraft or any Product and any other individual,
      partnership, corporation or entity which has or acquires any interest in
      any Product from, through or under APB.

                
	 
      	 
      
	
                  I.

                	
                  "Detail
      Part" means a subcomponent of an Assembly or Kit.

                
	 
      	 
      
	
                  J.

                	
                  "Drawing"
      means an electronic or manual depiction of graphics or technical
      information representing a Product or any part thereof and which includes
      the parts list and specifications relating thereto.

                
	 
      	 
      
	
                  K.

                	
                  "First
      Article" ("FA") means the first Shipset of Products to be shipped in place
      to APB.

                
	 
      	 
      
	
                  L.

                	
                  "First
      Part Qualification" means the first representative parts or kits
      manufactured utilizing production processes to verify that the production
      processes are capable of yielding parts in compliance with the respective
      Engineering drawing and specifications.

                
	 
      	 
      
	
                  M.

                	
                  "FAA"
      means the United States Federal Aviation Administration or any successor
      agency thereto.

                
	 
      	 
      
	
                  N.

                	
                  "FAR"
      means the Federal Aviation Regulations in effect on the date of this
      Agreement.

                
	 
      	 
      
	
                  O.

                	
                  "In-Production
      Requirement" means any Spare Part which is in the current engineering
      configuration for the Product and is used on an aircraft model currently
      being modified.

                
	 
      	 
      
	
                  P.

                	
                  "Kit"
      means a collection of machined or formed parts manufactured according to a
      specific Bill of Material and usually supplied as one part, or kit,
      number, including both right hand and left hand
  components.

                
	 
      	 
      
	
                  Q.

                	
                  "LMI"
      has the meaning given in the Preamble.

                
	 
      	 
      
	
                  R.

                	
                  "Material
      Representative" means the individual designated from time to time by APB
      as being primarily responsible for interacting with LMI regarding this
      Agreement and any Order.

                
	 
      	 
      
	
                  S.

                	
                  "Non-Production
      Requirement" means any Spare Part which is no longer being manufactured in
      production or is in a non-current engineering configuration for the
      Product.

                
	 
      	 
      
	
                  T.

                	
                  "Order"
      means each purchase order issued by APB and accepted by LMI under the
      terms of this Agreement.

                
	 
      	 
      
	
                  U.

                	
                  "Product"
      means goods, including components and parts thereof, services, documents,
      data, software, software documentation and other information or items
      furnished or which may be furnished to APB under any Order, including
      Tooling, with respect to wing modification parts or kits, for the
      767-300-ER/F wing modification program.

                


           

           

          
            
              2

            

            
              Master Agreement No.
APB-LMI-001

              
                

              

            

            
              
              

            

          

           

          
            	
                    V.

                  	
                    "Production
      Phase" means the period after which APB has obtained an STC for the
      767-300ERF winglet system.

                  
	 
      	 
      
	
                    W.

                  	
                    "Repair"
      means to make a Product serviceable by replacing or processing failed or
      damaged parts.

                  
	 
      	 
      
	
                    X.

                  	
                    "Repairable
      Product" means a Spare Parts classification assigned by APB. Indicates
      that a failed or damaged Product can be restored to a serviceable
      condition.

                  
	 
      	 
      
	
                    Y.

                  	
                    "Routine"
      means a Spare Part required in LMI's normal lead-time.

                  
	 
      	 
      
	
                    Z.

                  	
                    "Shipset"
      means the total quantity of Product necessary for one (1) airplane. Left
      hand wing modification parts and right hand wing modification parts are
      necessary for one (1) airplane.

                  
	 
      	 
      
	
                    AA.

                  	
                    "Spare
      Part" ("Spares") means any Product, regardless of whether the Product is a
      wing modification Kit or Detail Part, which is intended for use or sale as
      a spare part.

                  
	 
      	 
      
	
                    BB.

                  	
                    "Supplemental
      Type Certificate" or "STC" means a certification vehicle obtained from the
      FAA used by third parties to supplement the OEM Type Certificate for an
      airplane model.

                  


          

        

      

      


      2.0                      TERM
OF AGREEMENT, ORDERS

      


      2.1                      Term
of Agreement

      


      This
Agreement is in effect for five years, commencing as of the date referenced
above. It can be extended by mutual agreement at any time, but not later than
180 days prior to its expiration. Either party may initiate the extension
discussion through notifying the other party of its desire to extend the
Agreement.

      


      2.2                      Follow-on
Models

      


      This
Agreement is not intended to extend to any follow-on models to the 767 family,
should APB elect to undertake the development of those models. APB presently
anticipates that follow on model work packages will be subject to a separate RFQ
process. Assuming satisfactory performance by LMI under the Agreement, LMI will
have the right to participate in any such RFQ.

      


      2.3                      Order
Quantity

      


      Subject
to Section 6.1 regarding final determination of prices, APB agrees to purchase
from LMI 100 Shipsets of wing modification machined parts for the 767-300ER and
767-300F program. APB has the option to order 200 additional Shipsets upon the
terms and condition set forth in this Agreement, at the Base Price finally
determined according to Section 6.1. LMI will be prepared to make initial
deliveries on or about February 1, 2008.

       

       

      
        
          3

        

        
          Master Agreement No.
APB-LMI-001

          
            

          

        

        
          
          

        

      

       

      2.4                      Issuance
of Orders

      


      APB
expects to issue Orders to LMI annually for Products. For the first year only
there will be at least two orders, one initial Order for two Shipsets to support
flight testing, and one Order after testing and certification is completed for
the balance of the first year's production articles. Thereafter, Orders will
generally be issued one per calendar year, generally six months before the
beginning of the calendar year. Each Order shall contain a description of the
Products ordered, a reference to the applicable specifications and Drawings, the
quantities and prices, the delivery schedule, the terms and place of delivery,
and any special conditions.

      


      Each
Order shall be governed by and be deemed to include the provisions of this
Agreement. The following note will be contained in any Order to which this
Agreement is applicable:

      


      "Order is
subject to Master Agreement between APB and LMI dated [] as amended from time to
time."

      


      Any terms
and conditions on the face of the Order which conflict with or are additional
requirements to this Agreement will take precedence over this
Agreement.

      


      2.5                      Orders
Containing Additional Terms

      


      To the
extent any Order includes special conditions, special delivery terms or any
other terms or conditions that are additional to or different from those set
forth in this Agreement, such Order is APB's offer to LMI in respect of such
additional terms. Acceptance by LMI is strictly limited to the additional terms
in the Order. APB will not be bound by any term or condition that is different
from or in addition to the provisions of the Order, whether or not such term or
condition will materially alter the Order. LMI's commencement of performance or
acceptance of the Order in any manner shall conclusively evidence LMI's
acceptance of the Order as written. APB may revoke any Order prior to APB's
receipt of LMI's written acceptance or LMI's commencement of
performance.

      


      2.6                      Written
Authorization to Proceed

      


      The
Material Representative may give written authorization on behalf of APB to LMI
to commence performance before APB issues an Order. If such written authority to
proceed or "ATP" specifies that an Order will be issued, APB and LMI shall
proceed as if an Order had been issued. The parties shall promptly consult and
use commercially reasonable efforts to agree on any open terms that would
otherwise be required in an Order. If APB does not specify in its ATP that an
Order shall be issued, APB's obligation is strictly limited to the terms of the
ATP.

      


      LMI may
not proceed with any work under this Agreement without an explicit written ATP
or written Order from APB. LMI may elect to proceed at risk prior to receipt of
any such ATP or Order. In such case APB accepts no liability whatsoever for
costs or other obligations incurred should an ATP or Order not be issued for any
reason.

       

       

      
        
          4

        

        
          Master Agreement No.
APB-LMI-001

          
            

          

        

        
          
          

        

      

      
2.7                      Rejection
of Purchase Order

      


      Any
rejection by LMI of an Order shall be in writing and specify the reasons for
rejection and any changes or additions that would make the Order acceptable to
LMI. LMI may not reject (and accordingly shall accept) any Order that complies
with the provisions of this Agreement and does not include additional terms or
conditions.

      


      3.0                      TITLE
AND RISK OF LOSS

      


      Title to
and risk of any loss of or damage to the Products shall pass in accordance with
Ex Works (INCOTERMS 2000). Accordingly, title and risk of loss shall pass to APB
when the Products have been completed, passed inspection by LMI's final
inspectors in accordance with Article 8.0, invoiced to APB, made available for
shipment, and placed in storage at its facilities in Savannah, Georgia in
accordance with Article 4.0. LMI will be liable to APB for any damage to the
Products prior to pick up by the carrier that is caused by LMI's fault or
negligence.

      


      4.0                      DELIVERY
PROCESS/INVOICE EVENT

      


      4.1                      Delivery
Requirements

      


      LMI shall
make all deliveries to or at the direction of APB strictly in accordance with
the quantities, delivery schedule, and other requirements specified in the
applicable Order. LMI may not make early deliveries or partial deliveries
without APB's prior written authorization. Deliveries inconsistent with the
terms of an Order may be returned to LMI at LMI's sole expense.

      


      4.2                      Delivery
Process

      


      APB will
request LMI to "Ship-in-Place" Products according to the delivery schedule set
fort in the applicable Purchase Order. Ship-in-Place means that LMI has
completed and invoiced APB for the Products in accordance with the Order
schedule, and risk and title has passed to APB, however, the physical location
of the Products is at LMI's facilities in Savannah, Georgia. For Ship-in-Place,
LMI shall package the completed Products and store in an LMI-controlled secure
inventory warehouse.

      


      4.3                      Shipment
Notification

      


      APB will
notify LMI when APB-owned inventory is required to be shipped to APB Customers.
A shipment notification form and instructions will be provided to LMI at least
four days prior to the scheduled ship date. LMI will confirm receipt of the
shipment notification. A customs invoice will be supplied by LMI as required.
APB shall make arrangements for the transport of Products from EXW LMI Savannah,
Georgia to the destination designated by APB in the shipment notification.
Payment in accordance with Article 6.0 of this Agreement shall be applicable
from the date of Ship-in-Place and not the date of actual delivery to APB's
Customers.

       

       

      
        
          5

        

        
          Master Agreement No.
APB-LMI-001

          
            

          

        

        
          
          

        

      

       

      4.4        Non-Excusable Delay
4.4.1 Delivery Performance

      


      4.4.1                      Delivery
Performance

      


      Delivery
shall be in accordance with the schedule set forth in the applicable Order. Any
failure by LMI to meet a delivery schedule that is not an Excusable Delay as
defined Article 15.0 shall be considered a "Non-Excusable Delay".

      


      4.4.2                      Notification

      


      If a
Non-Excusable Delay is expected to occur or occurs that causes or may cause a
delay in the performance by LMI of its obligations under the Agreement, LMI
shall:

      


      
        	
                a.

              	
                notify
      APB of such Non-Excusable Delay immediately upon becoming aware of the
      same;

              
	 
      	 
      
	
                b.

              	
                describe
      the event causing the Non-Excusable Delay in reasonable
      detail;

              
	 
      	 
      
	
                c.

              	
                provide
      an evaluation of the obligations affected;

              
	 
      	 
      
	
                d.

              	
                indicate
      the probable duration and extent of such delay;

              
	 
      	 
      
	
                e.

              	
                notify
      APB of the measures that will be taken; and

              
	 
      	 
      
	
                f.

              	
                submit
      to APB an action plan to recover such
delay.

              


      

      


      
        	
                4.4.3

              	
                Mitigation

              


      

      


      If, as a
consequence of a Non-Excusable Delay, LMI fails or anticipates that it shall
fail to meet a delivery schedule, LMI shall use its best efforts, including
overtime, to mitigate such delay. LMI shall be responsible for and shall,
subject to the provisions of Section 4.4.4, pay all direct costs which may be
incurred by APB as a consequence of the Non-Excusable Delay. LMI shall send the
Product by another means of transportation and/or to a destination other than
the one specified in the Agreement, at LMI's expense, in order to minimize
delay

      


      4.4.4                      APB's
Rights

      


      
        	
                 
      

              	
                In
      the event of a Non-Excusable Delay during the Production Phase, APB may
      claim as
      liquidated damages the
following:

              


      

      
        
        

      

      


      
        	
                a.

              	
                *                   
      

              


      

      


      
        	
                b.

              	
                *                   
      

              


      

      


      
        	
                 
      

              	
                (i)

              	
                *                   
      

              


      

       

       

       

      * The text noted by
asterisks has been redacted in connection with a request to the Securities and
Exchange Commission for confidential treatment of such text pursuant to Rule
24b-2.  A copy of this Agreement including the redacted information has
been submitted to the Securities and Exchange Commission as part of such
request.

       

      
        
          6

        

        
          Master Agreement No.
APB-LMI-001

          
            

          

        

        
          
          

        

      

      
 

      
        	
                 
      

              	
                (ii)

              	
                *                   
      

              


      

      


      
        	
                 
      

              	
                (iii)

              	
                *                   
      

              


      

      


      The
foregoing remedy is in addition to all other rights and remedies APB may have at
law and/or under this Agreement, including under Article 14.0 "Events of Default
and Remedies".

      


      4.5                      Notice
of Labor Disputes

      


      LMI shall
immediately notify APB of any actual or potential labor dispute that may disrupt
the timely performance of an Order and/or impair the quality of any Product to
be delivered. LMI shall include the substance of this Section 4.5, including
this sentence, in any subcontract relating to an Order if a labor dispute
involving the subcontractor would have the potential to delay the timely
performance of such Order. Each subcontractor, however, shall only be required
to give the necessary notice and information to its next higher-tier
subcontractor.

      


      5.0                      ON-SITE
REVIEW AND RESIDENT REPRESENTATIVES

      


      5.1                      Review

      


      At APB's
request, LMI shall provide at APB's facility or at a place designated by APB, a
review explaining the status of the Order, actions taken or planned relating to
the Order and any other relevant information. Nothing herein may be construed as
a waiver of APB's rights to proceed against LMI because of any
delinquency.

      


      APB's
authorized representatives may enter LMI's plant at all reasonable times to
conduct preliminary inspections and tests of any Product and work-in-process.
LMI shall include in its subcontracts issued in connection with an Order a like
provision giving APB the right to enter the premises of LMI's subcontractors
when requested by APB. LMI may accompany APB to LMI's
subcontractors.

      


      5.2                      Resident
Representatives

      


      APB may
in its discretion and for such periods as it deems necessary assign resident
personnel at LMI's facilities. LMI shall furnish, free of charge, all office
space, secretarial service, and other facilities and assistance reasonably
required by APB's representatives at LMI's plant. The resident team will provide
communication and coordination to ensure timely performance of the Order. APB's
resident team shall be allowed access to all work areas relevant to wing mod kit
component production or kitting, order status reports and management review
necessary to assure timely performance and conformance with the requirements of
each Order. Notwithstanding such access, and all other inspections, reviews and
the like contemplated by this Agreement, LMI shall be solely responsible to
perform in accordance with each Order.

       

       

       

      
        * The text noted by
asterisks has been redacted in connection with a request to the Securities and
Exchange Commission for confidential treatment of such text pursuant to Rule
24b-2.  A copy of this Agreement including the redacted information has
been submitted to the Securities and Exchange Commission as part of such
request.

      

       

       

      
        
          7

        

        
          Master Agreement No.
APB-LMI-001

          
            

          

        

        
          
          

        

      

      
6.0                      PAYMENT/PRICING

      


      6.1                      Product
Pricing

      


      Estimated
prices for Products scheduled for delivery under this Agreement are set forth in
Attachment A. Prices are in United States dollars, EXW (INCOTERMS 2000) LMI
Aerospace, Inc., Savannah, Georgia. Prices include an estimated Base Price and
an estimated Nonrecurring Price. It is understood between the parties that the
price estimates, which are provided by LMI, are based on a Kit of parts deemed
similar to the 767 program. Within a reasonable time after receipt of
engineering drawings and finalization of designs post flight test, LMI will
submit its final Base Price and final Nonrecurring Price on a revised Attachment
A which will be considered an amendment to this Agreement if accepted by APB.
APB will indicate its acceptance by countersigning the revised Attachment A and
returning it to LMI.

      


      If the
Base Price or the Nonrecurring Price for the final engineered parts is
substantially higher than LMI's estimated price, then LMI and APB will review
engineering changes on a part by part basis versus the quoted estimated price,
and endeavor to resolve through discussion the price differences.

       

      Under
such provisions, if the parties are unable to reach agreement on final prices,
APB may exercise its right to request price estimates from third parties to
produce Products or components of Products. If APB is able to obtain a lower
price quotation of either the Base Price or the Nonrecurring Price, then APB may
elect to procure Products from third parties, and will not be obligated to
purchase any further Shipsets under Section 2.3.

      


      6.2                      Payment

      


      Unless
otherwise provided in the applicable Order, payment of the Base Price will be
paid Net 30 days from date of invoice except as otherwise agreed to by the
parties. Invoicing will take place on completion of the Product and submission
of Certificate of Conformity ("C of C"). All payments will be made by check, and
are subject to adjustment for shortages, credits and rejections.

      


      6.3                      Amortization
of Nonrecurring Price

      


      Any
applicable nonrecurring costs will be amortized over the first 100 Shipsets. Any
subsequent nonrecurring costs (caused by engineering change, for example) will
be mutually negotiated between the parties and amortized over the Shipsets
remaining in the initial 100 Shipset buy.

      


      7.0                      PACKING AND
SHIPPING

      


      7.1                      Packaging

      


      The
prices shown for Winglet Modification Kits in Attachment A include packaging
costs and all materials and labor required to package Products. Packaging shall
be furnished by LMI in accordance with D37520-0 through -4, "Boeing Supplier
Part Protection Guide".

       

       

      
        
          8

        

        
          Master Agreement No.
APB-LMI-001

          
            

          

        

        
          
          

        

      

       

      7.2                      General

      


      LMI shall
prepare for shipment and suitably pack all Products to prevent damage or
deterioration and comply with any special instructions stated in the applicable
Order. APB shall pay no charges for preparation, packing, crating or cartage
unless stated in the applicable Order. Consistent with EXW (Incoterms 2000), LMI
shall be responsible for making Products available to the freight forwarder and
loading the Products on departure and bear the risks and costs of such
loading.

      


      APB may
elect, if reasonable conditions exist, to request LMI to prepay, and if APB so
elects LMI shall prepay, shipping and freight-forwarder costs, and invoice APB
separately for these additional costs. Where APB has not identified a carrier,
APB shall request LMI to secure the lowest transportation rates and comply with
the appropriate carrier tariff for the mode of transportation specified by
APB.

      


      7.3                      Requirements
for each Shipment

      


      Unless
otherwise directed by APB, all standard routing shipments forwarded on one day
must be consolidated to the extent practical. Each container must be
consecutively numbered and marked as set forth herein and below. Container and
Order numbers must be clearly set out on the applicable bill of lading. Two
copies of the packing sheets must be attached to the No. 1 container of each
shipment and one copy in all other individual containers. Each pack sheet must
include as a minimum the following: (a) LMI's name, address and phone number;
(b) Order and item number; (c) ship date for the Products; (d) total quantity
shipped and quantity in each container, if applicable; (e) legible pack slip
number; (f) nomenclature; (g) unit of measure; (h) name and address of consignee
if other than APB; (i) warranty data and certifications as applicable; (j)
rejection tag, if applicable; (k) LMI's Certificate of Conformity; and (1)
identification of optional material used, if applicable.

       

      7.4                      Tariff
Declaration

      


      LMI may
not make any declaration concerning the value of the Products shipped, except on
Products where the tariff rating or rate depends on the released or declared
value, and in such event the value shall be released or declared as determined
by APB

      


      7.5                      Unit
Container Markings

      


      The
following markings shall be included on each unit container: (a) LMI's name; (b)
LMI's part number, if applicable; (c) APB part number, if applicable; (d) part
nomenclature; (e) Order number or identification of ATP; (f) quantity of
Products in container; (g) unit of measure; (h) serial number, if applicable;
(i) date (quarter/year) identified as assembly or rubber cure date, if
applicable; (j) precautionary handling instructions or marking as
required.

      


      7.6               Shipping
Container Markings

      


      The
following markings/labels shall be included on each shipping container: (a) name
and address of consignee; (b) name and address of LMI (as consignor); (c) Order
number; (d) part number as shown on the Order; (e) quantity of Products in
container; (f) unit of measure; (g) box number; (h) total number of boxes in
shipment; and, (i) precautionary handling, labeling or marking as
required.

       

       

      
        
          9

        

        
          Master Agreement No.
APB-LMI-001

          
            

          

        

        
          
          

        

      

      
8.0                      QUALITY
ASSURANCE, INSPECTION, REJECTION, & ACCEPTANCE

      


      8.1                      QA/Inspection/PMA

      


      All work
performed under this Agreement shall be in accordance with the requirements of
the FAA approved Master Drawing List for each Product as maintained by
APB.

      


      FAA
conformity on the first two Shipsets of Product will be required prior to
shipment. The Conformity inspection will be performed by an FAA designee. The
FAA designee verifies and documents product configuration and compliance with
engineering requirements. Thereafter, APB will issue a PMA licensing letter to
LMI to produce Products in accordance with APB's STC. LMI is required to obtain
FAA PMA for subsequent Shipsets of all Products prior to their
shipment.

      


      8.2                      Quality
Management System

      


      LMI shall
maintain a Quality Management System that meets or exceeds AS9100 Rev. B/ISO
9001:2000, or equivalent quality system, as amended from time to time, which is
incorporated herein and made a part hereof by this reference and as applicable
to Customer and/or regulatory authority standards. As part of this Quality
Management System, LMI shall provide and maintain without additional charge to
APB, an inspection system that complies with all specifications stated in this
Agreement or the applicable Order. The Quality Management System will meet or
exceed the requirements of Title 14 of the Code of Federal Regulations (14CFR) §
21.303(h) (1) through (9).

      


      LMI shall
tender to APB for acceptance only Products that have been provided and processed
by approved sources in accordance with all specifications reflected in
engineering drawings. All controlled finished and special processes must be
performed in accordance with LMI special process approval as defined in the
applicable Quality Inspection Plan as required by Section 8.2.1. If
applicable, any proprietary processing must be performed by Boeing D1-4426
approved sources.

      


      LMI shall
perform a verification of engineering drawing dimensional requirements on all
Products or shall submit a statistically valid sampling plan to APB for
approval. LMI's personnel shall perform the inspection, witness the inspection,
or have an APB approved inspection delegation procedure.

      


      8.2.1                   Supplier
Quality Plan

      


      A
Supplier Quality Plan is required for all Products supplied under this Agreement
that meets the standards of AS9100 Section 7.1. Prior to manufacture of the
Products, LMI will provide a mutually agreed upon Quality Plan. Copies of the
plan shall be made available to APB's Customer and government representative
upon request.

      


      8.2.2                   Inspection

      


      As part
of the Quality Plan, LMI shall prepare records evidencing all inspections made
under the system and the outcome of such inspections. These records shall be
complete and made available in a timely manner to APB upon request during
performance of the work under the Order and for seven years
afterwards.

       

       

      
        
          10

        

        
          Master Agreement No.
APB-LMI-001

          
            

          

        

        
          
          

        

      

      
APB may
perform reviews and evaluations as reasonably necessary to ascertain compliance
with the requirements of this Agreement. Such reviews and evaluations shall be
conducted in a manner that will not unduly delay work under any applicable
Order. The parties acknowledge that, notwithstanding such reviews, LMI controls
the day-to-day production, delivery and associated documentation of its work,
and therefore, APB's right of review, whether exercised or not, does not release
LMI of any of its obligations of testing, inspection, quality control and
associated documentation.

      


      8.3                      Federal
Aviation Administration or Equivalent Government Agency Inspection

      


      APB,
APB's Customers and the FAA or any equivalent government agencies or regulatory
agencies shall have the right to inspect and test the material and workmanship
of all the Products, review relevant quality related records and audit LMI at
all places and times including, when practical, during the period of manufacture
or provision of services. If any such audit, inspection or test is made on the
premises of LMI, LMI shall furnish, without additional charge to the foregoing
parties, reasonable facilities and assistance for the safe and convenient
performance of audit, inspection or test.

       

      8.4                      APB's
Inspection, Acceptance and Rejection

      


      Nonconforming
Product: Notwithstanding (i) prior inspection, (ii) payment for, or (iii)
use of the Products ordered hereunder, APB shall have the following rights with
respect to any Products that do not conform to all requirements of the
Order:

      


      
        	
                 
      

              	
                (i)

              	
                APB
      shall have the right to reject such Product(s). Rejection must occur
      within 60 days of delivery to APB's Customer; failure to reject within
      such period shall be deemed acceptance of the Product (but such failure to
      reject, or any other acceptance of the Products or inspections in
      connection therewith, shall be without prejudice to rights under LMI's
      warranty). All such rejected Product(s) shall be returned to LMI at LMI's
      risk and expense, transportation collection and declared at full value
      unless LMI advises otherwise, for full credit or refund, at APB's option.
      The rejected Product(s) returned to LMI shall not be replaced by LMI
      except upon written instructions from APB. Rejected Product(s) shall not
      again be tendered to APB for acceptance without written disclosure of
      prior rejection(s);

              


      

      


      
        	
                 
      

              	
                (ii)

              	
                Nonconforming
      Products may be repaired by APB or by a third party selected by APB and
      retained by APB at an equitable reduction in price, provided that the
      parties have first discussed and determined the liability as being LMI's.
      Should the parties agree that APB can proceed with the repair of the
      nonconforming Product(s), all terms and conditions of the Order shall
      remain in full force and effect as to the Products furnished by LMI;
      and.

              


      

      


      In the
event of a dispute as to liability, APB or third party will proceed diligently
with any reasonable repairs, having notified LMI of its intention to do so,
pending final settlement of the dispute.

      


      
        	
                 
      

              	
                (iii)

              	
                LMI
      will immediately notify APB if LMI or its subcontractors become aware of
      nonconforming Products after they have been
  shipped.

              


      

       

       

      
        
          11

        

        
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APB-LMI-001

          
            

          

        

        
          
          

        

      

       

      8.5                      Certificate
of Conformity (C of C)

      


      LMI shall
supply and include with each shipment a Certificate of Conformity (C of C)
attesting to the release of the Products included in the shipment as
follows:

      


      
        	
                ·

              	
                Supplier
      Name and address

              
	
                ·

              	
                Date

              
	
                ·

              	
                Packing
      Sheet/list or C of C number

              
	
                ·

              	
                Order
      number

              
	
                ·

              	
                Identification
      of "Authorization to Ship" documents (in absence of
  Order)

              
	
                ·

              	
                Part
      Nomenclature

              
	
                ·

              	
                Part
      Number

              
	
                ·

              	
                Serial
      Numbers (if applicable)

              
	
                ·

              	
                Quantity
      of material, parts or kits to ship

              
	
                ·

              	
                Any
      applicable Discrepant Product document numbers, (i.e. APB or Customer
      rejection tag number)

              
	
                ·

              	
                Authorized
      LMI representation, name or stamp and signature

              
	
                ·

              	
                If
      applicable, an APB Source Inspection stamp and date of
      inspection.

              


      

      


      All
Products shall be marked with date of manufacture.

      


      8.6                      Airworthiness
Tag Requirement

      


      LMI shall
include with each shipment an FAA Airworthiness Tag 8130-3 executed by LMI as
the designee for all APB designed products.

      


      8.7                      Retention
of Records; Compliance with Standards

      


      LMI will
retain on file all C of C's and evidence of conformance documents for all
Product for seven years from delivery of Product. LMI affirms and represents
that the Products meet and/or exceed all applicable APB, government, and/or LMI
design control documents, inspection, validation, and functional test
requirements, unless otherwise noted in APB disposition forms accompanying the
Products. LMI confirms that any material supplied by APB for use in the
specified manufacturing operations will be the only material used to perform
such operations. For all raw materials being provided by LMI and incorporated
into the Products, LMI shall maintain relevant chemical, physical and mechanical
properties, test reports and evidence of conformance on file.

      


      Copies of
C of C's and other evidence of conformance documents shall be made available to
APB, APB's Customer, and government representatives upon request and shall be
retained for a period of seven years from delivery of Product. Such records
shall not be discarded without APB's prior approval.

      


      8.8                      Digital
Data Control System

      


      LMI shall
employ a Digital Data control system to assure that the integrity of engineering
and/or tooling configuration is maintained throughout LMI's Digital Data Control
system from receipt of the electronic data through creation of derivatives, to
product acceptance (Ref. Boeing D6-51991).

       

       

      
        
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APB-LMI-001

          
            

          

        

        
          
          

        

      

       

      8.9                      First
Article Inspection

      


      Products
manufactured and supplied to APB under this Agreement require First Article
Inspection ("FMI"). All First Article Inspection Reports ("FAIR") must be in the
format as defined in Aerospace Standard SAE AS9102 current revision. If forms
other than those contained in the standard are used, they must contain all
"Required" and "Conditionally Required" information.

      


      FAIRs are
to be completed on new Products representative of the first production run.
Prototype parts are not to be used for the FAIR. Partial First Article
Inspections shall be performed when any of the events noted in section 5.3 of
AS9102 occur.

      


      All FAIRs
shall be signed by authorized personnel, stamped and dated and, if required by
Aerospace Standard SAE AS9102, shall be approved by APB.

      


      8.10               Tool Control
System

      


      LMI shall
maintain a formal, internal tool control system that allows for the proper
segregation, maintenance and accountability of APB-owned tooling. Annual
inventories of said tooling shall be performed with the results maintained in
accordance with contractual requirements. Upon request, the results of said
inventories shall be forwarded to APB for review.

      


      8.11                      Direct
Sales/Regulatory Approvals

      


      Neither
LMI nor any of its subcontractors or suppliers may sell any Product directly to
anyone except APB unless APB's prior written authorization is obtained. If APB
provides its authorization, it is LMI's responsibility and LMI agrees to obtain
the necessary regulatory approvals and to mark and/or otherwise identify any
Products so produced in accordance with all applicable regulations, provided
that, if it is impossible for LMI to obtain such approval, APB and LMI agree to
pursue another possible reasonable solution to minimize the impact.

      


      9.0        PRODUCTION
RATE

      


      LMI will
supply 767-300ER/F wing modification kits ordered by APB up to a rate of *                    
Shipsets per month. Shipset requirements above this rate will be mutually
negotiated between the parties.

      


      10.0               CHANGES

      


      10.1               Change
Orders

      


      The
Material Representative may at any time by written change order make changes
within the general scope of an Order in any one or more of the following:
drawings, designs, specifications, APB-furnished data, including but not limited
to Loft, Loads, Interface Control Drawing, shipping, packing, place of
inspection, place of delivery, place of acceptance, adjustments in quantities,
adjustments in delivery schedules, or the amount of APB furnished material. LMI
shall proceed immediately to perform the Order as changed. If any such change
causes an increase or decrease in the cost of and/or the time required for the
performance of any part of the work, whether changed or not changed by the
change order, an equitable adjustment calculated in accordance with Section 10.3
shall be made in the price of or the delivery schedule for those Products
affected, and the applicable

       

       

       

       

      
        * The text noted by
asterisks has been redacted in connection with a request to the Securities and
Exchange Commission for confidential treatment of such text pursuant to Rule
24b-2.  A copy of this Agreement including the redacted information has
been submitted to the Securities and Exchange Commission as part of such
request.

      

       

      
        
          13

        

        
          Master
Agreement No. APB-LMI-001

          
            

          

        

        
          
          

        

      

       

      Order shall
be modified in writing accordingly. Any claim by LMI for adjustment under this
Article 10.0 must be received by APB in writing no later than 60 days from the
date of receipt by LMI of the written change order or within such further time
as the parties may agree in writing or such claim shall be deemed waived.
Nothing in this Section 10.1 shall excuse LMI from proceeding with an Order as
changed, including failure of the parties to agree on any adjustment to be made
under this Article 10.0.

      
10.2              Examination
of Records for Changes

      


      LMI shall
maintain complete and accurate records related to all change orders. Such
records shall itemize accurately and completely all services performed,
allowances claimed and costs incurred by LMI in the performance of each change
order, including but not limited to those factors which comprise or affect
direct labor hours, direct labor rates, material costs, burden rates and
subcontracts. Such records and other data shall be capable of verification
through audit and analysis by APB and be available to APB at LMI's facility for
APB's examination and audit at all reasonable times from the date of the
applicable change order until three years after final payment under such Order.
LMI shall provide assistance to interpret such data if requested by APB. Such
examination shall provide APB with complete information regarding LMI's
performance for use in price negotiations with LMI relating to existing or
future orders for Products, including but not limited to negotiation of
equitable adjustments for changes and termination/obsolescence claims pursuant
to Article 10.0. APB shall treat all information disclosed under this Section as
confidential.

      


      10.3               Computation
of Equitable Adjustment

      


      The Rates
and Factors set forth in Attachment B, which by this reference are incorporated
herein, shall be used to determine the equitable adjustment, if any, to be paid
by APB pursuant to Article 10.0 for each individual change.

      


      LMI shall
include in each claim sufficient detail to explain the amount claimed, including
detailed inventory schedules and a detailed break-down of all costs claimed
separated into categories (materials, purchased parts, finished components,
labor, burden, general and administrative), and to explain the basis for
allocation for all other costs.

      


      10.4                      Obsolescence

      


      Claims by
LMI to APB for obsolete or surplus material and work-in-process created by
change orders issued by APB to LMI pursuant to this Section shall be subject to
the procedures set forth in Section 10.3, except that LMI may not submit in any
calendar year a claim for obsolete or surplus material resulting from an
individual change order which when aggregated with the cost of other changes in
that calendar year, and not to that point paid by APB, has a total claim value
of Two Thousand Five Hundred Dollars ($2,500.00) or less.

      


      10.5                      Configuration

      


      Under the
Agreement, design of the Wing Modification Machined Parts will be provided by
APB or APB's design contractor. LMI will be expected to participate during the
design phase to assure the released engineering is compatible with LMI processes
and capabilities.

       

       

      
        
          14

        

        
          Master Agreement No.
APB-LMI-001

          
            

          

        

        
          
          

        

      

       

      10.5.1                  Configuration
Changes

       

      LMI and
its subcontractors shall ensure that all applicable requirements including
drawings, specifications, qualifications, etc. under the contract with APB are
flowed down to all suppliers and subcontractors performing work on APB Products.
LMI shall not make any configuration changes to any Products, which could affect
form, fit, function, performance or price without APB's prior written consent.
Notification and approval of configuration changes include those parts which are
superseded by another part. All LMI configuration change requests shall be
submitted to APB's Material Representative in writing for approval prior to
configuration change processing.

      


      10.6                      Pre-STC
Expedite Costs/Issues

      


      Both
parties recognize that design changes may be required, both before and after
flight test, that may require LMI to conduct expedite activities to meet flight
test or initial production deadlines. LMI agrees that to the extent a design
change released by APB requires a part change that is within LMI's published
parts manufacturing lead time (as documented in file: "Copy of WingIet Parts
7-27-07Revb.xls"), LMI will not be entitled to reimbursement for expedite costs.
To the extent a requested design change requires parts changes that are not
within LMI's published part's lead time, LMI will notify APB in writing of the
estimated cost to implement and expedite the design change, and submit a claim
to APB for direct expedite costs according to Article 10.0,
Changes.

      


      10.7               Planning
Schedule

      


      Any
planning schedule or quantity estimate provided or otherwise accepted by APB
shall be used solely for production planning. APB may purchase Products in
different quantities and specify different delivery dates as necessary to meet
APB's requirements. Such planning schedule and quantity estimate shall be
subject to adjustment from time to time. Any such adjustment is not a change
under Article 10.0, but subject to Article 11.0 of this Agreement.

      


      11.0               ACCELERATION/DECELERATION
AT NO COST

      


      Notwithstanding
Article 10.0, APB may make changes in the delivery schedule without additional
cost or change to the price stated in the applicable Order if (a) the delivery
date of the Product under such Order is on or before the last date of the
calendar year covered by the Order; and (b) APB provides LMI with written notice
of such changes. Upon receipt of written notice of the schedule change, LMI
shall make its best effort to implement the change as soon as possible. The
schedule change shall be implemented no later than four months after
notification of schedule acceleration or three months after notification of
schedule deceleration. If notification is made to LMI less than the limits
above, LMI may assert for costs in accordance with Article 10.0,
Changes.

      


      If APB
requires production rates beyond LMI's reasonable ability to achieve, APB will,
at its option, exercise its right to secure a second source for
production.

      


      12.0               PRODUCT SUPPORT AND
ASSURANCE

      


      12.1               Warranty

      


      LMI
expressly represents and warrants that each Product will:

       

       

      
        
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APB-LMI-001

          
            

          

        

        
          
          

        

      

       

       

      
        	
                 
      

              	
                (a)

              	
                be
      manufactured, repaired, tested, certified, weighed, inspected, shipped,
      sold, and delivered by LMI in accordance with the terms of this Agreement
      and

              


      

      


      
        	
                 
      

              	
                (b)

              	
                be
      manufactured, repaired, tested, certified, weighed, inspected, shipped,
      sold, delivered and subjected to any process or procedure by LMI, in
      strict compliance with applicable laws, including Federal Aviation
      Regulations; and

              


      

      


      
        	
                 
      

              	
                (c)

              	
                conform
      to its specification, be suitable for its intended purpose, be free from
      defects in workmanship, material and material selection, process of
      manufacture, free from liens and encumbrances, and shall conform to the
      applicable drawings and requirements of the Agreement and the applicable
      Order. Exceptions are for conditions caused by improper installation by
      APB or Customer, normal wear and tear, and failure to properly maintain
      and service the Product.

              


      

      


      The
Warranty will remain in effect for four years from the date the Product goes
into service with the Customer, or five years from the date the Product is
delivered to APB at the point of delivery (shipped in place), whichever occurs
first.

      


      LMI shall
be obligated to promptly replace or repair such defective Products or correct
any defective work on the Products, or provide authorization for third parties
to effect such repairs at LMI's expense, at APB's sole discretion. LMI shall pay
for any transportation charges incurred by APB and Product de-installation and
installation charges resulting directly from the replacement or repair activity
of such defective Products. APB shall notify LMI within a reasonable period
after the detection of a defect.

      


      In the
event of a dispute as to whether a breach of Warranty has occurred, LMI agrees
to proceed diligently with any reasonable repairs, replacement or correction
directed by APB pending final settlement of the dispute. If it is determined
that no such breach has occurred, APB shall pay LMI upon demand the reasonable
price of the repairs, corrections or replacements made by LMI including
reasonable profit.

      


      APB's
sole and exclusive warranty remedy against LMI is the repair or replacement of
defective parts, refund of the purchase price as provided herein, or
reimbursement for third party repairs, and no other remedy in respect of
warranties shall be available to APB including direct, indirect, incidental or
consequential damages for lost profits, lost sales, or any other incidental or
consequential loss.

      


      12.2        Insurance

      


      12.2.1                    Products
and Completed Operations Liability

      


      LMI
warrants and represents to APB at all times during the performance of any Order,
and during the term of the Agreement, LMI will carry and maintain products and
completed operations liability insurance in an amount not less that $*                   
with respect to legal liability to a person or third party arising out of
an accident.

      


      Prior to
the performance of any obligation set forth in this Agreement, LMI will provide
APB with certificates of insurance reflecting full compliance with the insurance
requirements stated in 

       

       

       

      
        * The text noted by
asterisks has been redacted in connection with a request to the Securities and
Exchange Commission for confidential treatment of such text pursuant to Rule
24b-2.  A copy of this Agreement including the redacted information has
been submitted to the Securities and Exchange Commission as part of such
request.

      

       

      
        
          16

        

        
          Master Agreement No.
APB-LMI-001

          
            

          

        

        
          
          

        

      

      
this
Section. Annual renewal certificates will be submitted to APB before the
expiration of the policy period. 

       

      The
amount of insurance obtained by a party will in no way limit the indemnification
obligations of the party under this Agreement.

      


      12.2.2                    Property
Insurance

      


      LMI shall
obtain and maintain continuously in effect a property insurance policy covering
loss or destruction of or damage to all property in which APB does or could have
an insurable interest pursuant to this Agreement, including but not limited to
Tooling, APB-furnished property, raw materials, parts, work-in process,
incomplete or completed assemblies and all other Products or parts thereof, and
all drawings, specifications, data and other materials relating to any of the
foregoing in each case to the extent in the possession or under the effective
care, custody or control of LMI, in the amount of full replacement value thereof
providing protection against all perils normally covered in an "all risk"
property insurance policy (including without limitation fire, windstorm,
explosion, riot, civil commotion, aircraft, earthquake, flood or other acts of
God). Any such policy shall be with insurers reasonably acceptable to APB and
shall (i) provide for payment of loss thereunder to APB, as loss payee, as its
interests may appear and (ii) contain a waiver of any rights of subrogation
against APB, its subsidiaries, and their respective directors, officers,
employees and agents.

      


      12.2.2.1                 Certificate
of Insurance

      


      LMI shall
provide to APB certificates of insurance reflecting full compliance with the
requirements set forth in Section 12.2.1 and 12.2.2. Such certificates shall be
kept current and in compliance throughout the period of this Agreement and shall
provide for 30 days advanced written notice to APB in the event of cancellation,
non-renewal or material change adversely affecting the interests of
APB.

      


      12.2.2.2                 Notice
of Damage or Loss

      


      LMI shall
give prompt written notice to APB of the occurrence of any damage or loss to any
property required to be insured herein. If any such property shall be damaged or
destroyed, in whole or in part, by an insured peril or otherwise, and if no
Event of Default shall have occurred and be continuing, then LMI may, upon
written notice to APB, settle, adjust, or compromise any and all such loss or
damage not in excess of $5,000 Dollars in any one occurrence, and $10,000
Dollars in the aggregate. LMI may settle, adjust or compromise any other claim
by LMI only after APB has given written approval, which approval shall not be
unreasonably withheld.

       

      12.3               Indemnity

      


      LMI will
defend, indemnify and hold harmless APB from and against any and all claims,
costs (including attorney fees), demands, proceedings and liabilities howsoever
arising and of whatever nature, of any person or loss of or damage to any
property, arising out or in respect of any Products provided or any work
performed by LMI under this Agreement.

      


      APB will
defend, indemnify and hold harmless LMI from and against any and all claims,
costs (including attorney fees), demands, proceedings and liabilities howsoever
arising and of whatever

       

       

      
        
          17

        

        
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APB-LMI-001

          
            

          

        

        
          
          

        

      

       

      
        nature,
of any person or loss of or damage to any property, arising out of or in respect
of any design defect of any Product.

      

      
12.4               Notice of
Claim

      


      If at any
time a party becomes aware that a breach of this Agreement has occurred or that
there is or may be a claim made against the party, the party will immediately
notify the other party of such breach or claim. Notice under this Section shall
be provided to the parties at the respective addresses identified in Section
27.1 of this Agreement unless otherwise specified.

      


      13.0              TERMINATION FOR
CONVENIENCE

      


      13.1                      Basis
for Termination; Notice

      


      APB may,
from time to time and at APB's sole discretion, terminate all or part of any
Order issued hereunder, and/or written authorization to proceed as specified in
Section 2.6 of this Agreement, by written notice to LMI. Any such written notice
of termination shall specify the effective date and the scope of any such
termination.

      


      13.2                      Termination
Instructions

      


      On
receipt of a written notice of termination pursuant to Section 13.1, unless
otherwise directed by APB, LMI shall:

       

      
        
          	
                   
      

                	
                  A.

                	
                  Immediately
      stop work as specified in the
notice;

                


        

         

        
          
            	
                     
      

                  	
                    B.

                  	
                    Immediately
      terminate its subcontracts and purchase orders relating to work
      terminated;

                  


          

           

        

        
          	
                   
      

                	
                  C.

                	
                  Settle
      any termination claims made by its subcontractors or suppliers; provided,
      that APB shall have approved the amount of such termination claims prior
      to such settlement;

                


        

         

        
          
            	
                     
      

                  	
                    D.

                  	
                    Preserve
      and protect all terminated inventory and
  Products;

                  


          

           

        

      

      
        	
                 
      

              	
                E.

              	
                At
      APB's request, transfer title (to the extent not previously transferred)
      and deliver to APB or APB's designee all supplies and materials,
      work-in-process, Tooling and manufacturing drawings and data produced or
      acquired by LMI for the performance of this Agreement and any Order, all
      in accordance with the terms of such
request;

              


      

      
         

        
          
            	
                     
      

                  	
                    F.

                  	
                    Be
      compensated for such items to the extent provided in Section 13.3
      below;

                  


          

           

        

      

      
        	
                 
      

              	
                G.

              	
                Return,
      or at APB's option and with prior written approval, destroy, all APB
      Proprietary Information and Materials in the possession, custody or
      control of LMI;

              


      

       

      
        	
                 
      

              	
                H.

              	
                Take
      such other action as, in APB's reasonable opinion, may be necessary, and
      as APB shall direct in writing, to facilitate termination of this Order;
      and

              


      

       

      
        
          
            	
                     
      

                  	
                    I.

                  	
                    Complete
      performance of the work not
terminated.

                  


          

           

        

      

       

       

      
        
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      13.3               LMI's
Claim

      


      If APB
terminates an Order in whole or in part pursuant to Section 13.1 above, LMI may
submit a written termination claim to APB in accordance with the terms of this
Section 13.3. In addition to the portion of the Base Price incurred by the LMI
with respect to such terminated Order, LMI may include in each termination claim
any unpaid portion of the amortized and incurred Nonrecurring Price to the
extent provided by Attachment A. In no event shall the total of previously paid
Nonrecurring Price and such claimed Nonrecurring Price exceed the Total
Nonrecurring Price identified in Attachment A. Each termination claim shall be
submitted to APB not later than six (6) months after LMI's receipt of the
termination notice and shall be in the form prescribed by APB. LMI shall include
in each claim sufficient detail to explain the amount claimed, including
detailed inventory schedules and a detailed breakdown of all costs claimed
separated into categories (e.g., materials, purchased parts, finished
components, labor, burden, general and administrative), and to explain the basis
for allocation of all other costs. Any costs incurred by LMI for inventory and
work-in-process in accordance with the Orders prior to the termination, except
those previously paid for, shall be reasonably compensated by APB at
cost.

      


      13.4               Failure to
Submit a Claim

      


      Notwithstanding
any other provision of this Article 13.0, if LMI fails to submit a termination
claim within the time period set forth above, LMI shall be barred from
submitting a claim and APB shall have no obligation to pay LMI under this
Article 13.0 or otherwise except for those Products previously delivered and
accepted by APB and those claims submitted to APB within the provided time
period in accordance with this Article 13.0.

      


      13.5                      
Partial Termination

      


      Any
partial termination of an Order shall not alter or affect the terms and
conditions (including without limitation unit prices) of the Order or any Order
with respect to Products not terminated. Termination of one Order shall not
affect any other Order(s).

      


      13.6                      Exclusions
or Deductions

       

      The
following items shall be excluded or deducted from any termination claim
submitted by LMI:

      


      
        	
                 
      

              	
                A.

              	
                All
      un-liquidated advances or other payments made by APB to LMI pursuant to a
      terminated Order;

              


      

       

      
        
          	
                   
      

                	
                  B.

                	
                  Any
      claim which APB has against LMI;

                


        

         

      

      
        
          	
                   
      

                	
                  C.

                	
                  The
      agreed price for scrap allowance;

                


        

         

      

      
        	
                 
      

              	
                D.

              	
                Except
      for normal spoilage and any risk of loss assumed by APB, the agreed fair
      value of property that is lost, destroyed, stolen or
    damaged.

              


      

       

       

      
        
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      13.7               Partial
Payment/Payment

      


      Payment,
if any, to be made under this Article 13.0 shall be made by APB to LMI 30 days
after settlement between the parties or as otherwise agreed to between the
parties.

      


      13.8               LMI's
Accounting Practices

      


      LMI shall
apply the "normal accounting practices" it has used in developing the price of
the Product(s) in determining the allocable costs at termination. For purposes
of this Section 13.8, LMI's "normal accounting practices" refers to LMI's method
of charging costs as a direct charge, overhead expense, or general
administrative expense.

      


      13.9               Records

      


      Unless
otherwise provided in this Agreement or by law, LMI shall maintain all records
and documents relating to the terminated portion of the Order for three (3)
years after final settlement of LMI's termination claim.

      


      14.0               EVENTS OF DEFAULT AND
REMEDIES

      


      14.1                      Events
of Default

      


      The
occurrence of any one or more of the following events shall constitute an "Event
of Default":

      


      
        	
                 
      

              	
                A.

              	
                Any
      failure by LMI to deliver, when and as required by this Agreement or any
      Order, any Product, except as provided in Article 15.0 (Excusable Delay)
      and such failure shall continue unremedied for a period of 30 days or more
      following receipt by LMI of notice from APB specifying such
      failure;

              


      

      


      
        	
                 
      

              	
                B.

              	
                Any
      failure by LMI to provide an acceptable Assurance of Performance within
      the time specified in Article 18.0, or otherwise in accordance with
      applicable law;

              


      

      


      
        	
                 
      

              	
                C.

              	
                Any
      failure by LMI to perform or comply with any obligation set forth in
      Article 23.0 (Proprietary Information and Materials) and such failure
      shall continue un-remedied for a period of five days or more following
      receipt by LMI of notice from APB specifying such
  failure;

              


      

      


      
        	
                 
      

              	
                D.

              	
                Any
      participation by LMI in the sale, purchase or manufacture of airplane
      parts under the scope of this Agreement without the required approval of
      the FAA and such failure shall continue un-remedied for a period of 30
      days or more following receipt by LMI of notice from APB specifying such
      failure;

              


      

      


      
        	
                 
      

              	
                E.

              	
                APB
      determines that LMI's Quality Management System or Quality Supply Plan
      inadequate, and LMI fails to address such inadequacy with 30 days of being
      notified of the same by APB;

              


      

       

       

      
        
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                F.

              	
                Any
      failure by LMI to perform or comply with any obligation set forth in this
      Agreement and such failure shall continue un-remedied for a period of 45
      days or more following receipt by LMI of notice from APB specifying such
      failure; or

              


      

      


      
        	
                 
      

              	
                G.

              	
                (a)
      the suspension, dissolution or winding-up of LMI's business, (b) LMI's
      insolvency, or its inability to pay debts, or its nonpayment of debts, as
      they become due, (c) the institution of reorganization, liquidation or
      other such proceedings by or against LMI or the appointment of a
      custodian, trustee, receiver or similar person for LMI's properties or
      business, (d) an assignment by LMI for the benefit of its creditors, or
      (e) any action of LMI for the purpose of effecting or facilitating any of
      the foregoing.

              


      

      


      14.2                      
Remedies

      


      If any
Event of Default shall occur:

      


      A.    Cancellation

      
        	
                 
      

              	
                APB
      may, by giving written notice to LMI, immediately cancel this Agreement
      and/or any Order, in whole or in part, and APB shall not be required after
      such notice to accept the tender by LMI of any Products with respect to
      which APB has elected to cancel this Agreement, provided APB shall pay LMI
      for all Products ordered by APB and delivered by LMI to
    APB.

              


      

      


      B.     Cover

      
        	
                 
      

              	
                APB
      may manufacture, produce or provide, or may engage any other persons to
      manufacture, produce or provide, any Products in substitution for the
      Products to be delivered or provided by LMI hereunder with respect to this
      Agreement or any Order and, in addition to any other remedies or damages
      available to APB hereunder or at law or in equity, APB may recover from
      LMI the difference between the price for each such Product and the
      aggregate expense, including, without limitation, administrative and other
      indirect costs, paid or incurred by APB to manufacture, produce or
      provide, or engage other persons to manufacture, produce or provide, each
      such Product.

              


      

       

      
        C.     Rework or Repair

      

      
        
        

      

      
        	
                 
      

              	
                Where
      allowed by the applicable regulatory authority, APB or its designee may
      rework or repair any Product in accordance with Article
    12.0.

              


      

      


      D.    Setoff

      
        	
                 
      

              	
                APB
      may set off against and apply to the payment or performance of any
      obligation, sum or amount owing at any time to APB hereunder or under any
      Order, all deposits, amounts or balances held by APB for the account of
      LMI and any amounts owed by APB to
LMI.

              


      

      


      E.     Tooling and other
Materials

      
        	
                 
      

              	
                LMI
      shall upon the request of APB, immediately transfer and deliver to APB or
      APB's designee title and possession to any or all (i) Tooling, (ii)
      APB-furnished material, (iii) raw materials, parts, work-in-process,
      incomplete or completed assemblies, and all other Products or parts
      thereof in the possession or under the effective control of LMI or any of
      its subcontractors (iv) Proprietary Information and Materials of APB
      including without limitation planning data, drawings and other Proprietary
      Information and Materials relating

              


      

       

       

      
        
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                    to
      the design, production, maintenance, repair and use of Tooling, in the
      possession or under the effective control of LMI or any of its
      subcontractors, in each case free and clear of all liens, claims or other
      rights of any person. In consideration of APB's acquisition of title to
      the Tools, data and material, the termination settlement shall take into
      account any damage payable by LMI to APB as a result of any event of
      default and such amount shall be accounted to a set off against the
      unrecovered Nonrecurring Price.

                     

                    LMI shall be entitled to receive from APB
      reasonable compensation for any item accepted by APB which has been
      transferred to APB pursuant to this Section 14.E (except for any item the
      price of which shall have been paid to LMI prior to such transfer, and
      except for items covered by 14.E (ii) and (iv); provided, however, that
      such compensation shall not be paid directly to LMI, but shall be
      accounted for as a setoff against any damages payable by LMI to APB as a
      result of any Event of Default.

                  


          

           

           

        

      

      F.     Remedies
Generally

      
        
          
            	
                     
      

                  	
                    No
      failure on the part of APB in exercising any right or remedy hereunder, or
      as provided by law or in equity, shall impair, prejudice or constitute a
      waiver of any such right or remedy, or shall be construed as a waiver of
      any Event of Default or as acquiescence therein. No single or partial
      exercise of any such right or remedy shall preclude any other or further
      exercise thereof or the exercise of any other right or remedy. No
      acceptance of partial payment or performance of any of LMI's obligations
      hereunder shall constitute a waiver of any Event of Default or a waiver or
      release of payment or performance in full by LMI of any such obligation.
      All rights and remedies of APB hereunder and at law and in equity shall be
      cumulative and not mutually exclusive and the exercise of one shall not be
      deemed a waiver of the right to exercise any
  other.

                  


          

           

        

      

      G.    
Contractual
Liability

      
        
          
            
              	
                       
      

                    	
                      LMI
      shall be liable to APB for the timely and proper performance of its
      obligations under this Agreement and, except to the extent of the
      indemnities and specific remedies as set out in the Agreement, shall be
      liable for all direct costs, direct losses, damages and liabilities,
      including without limitation costs and expenses incidental thereto such as
      but not limited to legal fees which may be incurred by APB as a
      consequence of the failure by LMI to comply with its obligations under the
      Agreement or as a consequence of the termination of the Agreement. APB
      agrees to provide LMI with the breakdown of the said costs, losses,
      damages and liabilities referenced above in this Section
    14.2.

                    


            

             

          

        

      

      15.0               EXCUSABLE
DELAY

      


      If
delivery of any Product is delayed by unforeseeable circumstances beyond the
control and without the fault or negligence of LMI or of its suppliers or
subcontractors (any such delay being hereinafter referred to as "Excusable
Delay"), the delivery of such Product shall be extended for a period to be
determined by APB after an assessment by APB of alternate work methods.
Excusable Delays may include, but are not limited to, acts of God, war, riots,
acts of government, fires, floods, epidemics, quarantine restrictions, freight
embargoes, strikes or unusually severe weather, but shall exclude among other
things, LMI's noncompliance with any rule, regulation or order promulgated by
any governmental agency, or nonperformance of LMI suppliers. However, the above
notwithstanding, APB expects LMI to continue production, recover lost time and
support all schedules as established

       

       

      
        
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APB-LMI-001

          
            

          

        

        
          
          

        

      

       

      
        under
this Agreement or any Order. If delay in delivery of any Product is caused by
the default of any of LMI's subcontractors or suppliers, such delay shall not be
considered an Excusable Delay unless such delay is caused for reasons the same
as those considered to be Excusable Delay for LMI. If delivery of any Product is
delayed by any Excusable Delay for more than three (3) months, APB may, without
any additional extension, cancel this Agreement or all or part of any Order with
respect to the delayed Products, and exercise any of its remedies in accordance
with Section 14.2, except for 14.2.B, "Cover", provided however, that APB shall
not be entitled to monetary damages or specific performance to the extent LMI's
breach is the result of an Excusable Delay.

         

      

      16.0         SUSPENSION OF
WORK

      


      APB may
at any time, by written order to LMI, issued pursuant to this Article 16.0,
require LMI to stop all or any part of the work called for by this Agreement for
up to one hundred twenty (120) days hereafter referred to as a "Stop Work
Order". On receipt of a Stop Work Order, LMI shall promptly comply with its
terms and take all reasonable steps to minimize the occurrence of costs arising
from the work covered by the Stop Work Order during the period of work stoppage.
Within the period covered by the Stop Work Order (including any extension
thereof) APB shall either (i) cancel the Stop Work Order or (ii) terminate or
cancel the work covered by the Stop Work Order in accordance with the provisions
of Articles 13.0 or 14.0. In the event the Stop Work Order is canceled by APB or
the period of the Stop Work Order (including any extension thereof) expires, LMI
shall promptly resume work in accordance with the terms of this Agreement or any
applicable Order.

      


      If the
Stop Work Order has resulted in a change in the schedule or cost of performance,
an equitable adjustment shall be made in the price and/or delivery schedule,
according to Section 10.3, and the Order or this Agreement, as appropriate, will
be modified in writing accordingly. LMI must assert any claim for adjustment
within sixty (60) days from the date of receipt of the Stop Work
Order.

      


      
        	
                17.0

              	
                TERMINATION OR CANCELLATION AND
      INDEMNITY AGAINST SUBCONTRACTOR
      CLAIMS

              


      

      


      APB shall
not be liable for any loss or damage resulting from any termination pursuant to
Section 13.0 except as expressly provided in Section 13.3, or any cancellation
under Section 14.0, except to the extent that such cancellation shall have been
determined to have been wrongful, in which case such wrongful cancellation shall
be deemed a termination pursuant to Section 13.0 and therefore shall be limited
to the payment to LMI of the amount or amounts identified in Section 13.3. As
subcontractor claims are included in LMI's termination claim pursuant to Section
13.3, LMI shall indemnify APB and hold APB harmless from and against (i) any and
all claims, suits and proceedings against APB by any subcontractor or supplier
of LMI in respect of any such termination pursuant to Section 13.0 and (ii) and
any and all costs, expenses, losses and damages incurred by APB in connection
with any such claim, suit or proceeding.

      


      18.0               ASSURANCE OF
PERFORMANCE

      


      18.1               LMI to
Provide Assurance

      


      If APB
determines, at any time or from time to time, that it is not sufficiently
assured of LMI's full, timely and continuing performance hereunder, or if for
any other reason APB has reasonable grounds for insecurity, APB may request, by
notice to LMI, written assurance (hereafter an 

       

       

      
        
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APB-LMI-001

          
            

          

        

        
          
          

        

      

       

      "Assurance of
Performance") with respect to any specific matters affecting LMI's performance
hereunder, that LMI is able to perform all of its respective obligations under
this Agreement when and as specified herein. Each Assurance of Performance shall
be delivered by LMI to APB as promptly as possible, but in any event no later
than 30 calendar days following APB's request therefore and each Assurance of
Performance shall be accompanied by any information, reports or other materials,
prepared by LMI, as APB may reasonably request. APB may suspend all or any part
of APB's performance hereunder until APB receives an Assurance of Performance
from LMI satisfactory in form and substance to APB.

      
18.2               Meetings and
Information

      


      APB may
request one or more meetings with senior management or other employees of LMI
for the purpose of discussing any request by APB for Assurance of Performance or
any Assurance of Performance provided by LMI. LMI shall make such persons
available to meet with representatives of APB as soon as may be practicable
following a request for any such meeting by APB and LMI shall make available to
APB any additional information, reports or other materials in connection
therewith as APB may reasonably request.

      


      19.0                      
LEAD TIMES

      


      APB shall
issue an initial Order for the first two Shipsets of Products. Thereafter,
Products for APB requirements, assuming no break in the Production Phase, will
be ordered at least 26 weeks prior to the scheduled date of delivery from LMI to
APB. Provided, however, LMI shall request of APB as required written
authorization to proceed as defined in Section 2.6 for the purchase of long
lead-time materials, in sufficient time to support the scheduled
deliveries.

      


      20.0               PERFORMANCE
VISIBILITY AND REVIEWS

      


      When
requested by APB, LMI shall provide all necessary program performance data, and
when so requested, LMI shall prepare and conduct a program performance review
specific to the scope of this program, pursuant to any Order or
program.

      


      21.0               RESPONSIBILITY FOR
APB PROPERTY

      


      On
delivery to LMI of any materials, parts, Tooling or other property, title to any
of which is held by APB, LMI shall assume the risk of and shall be responsible
for any loss thereof or damage thereto, as long as they are in the custody and
control of LMI, and/or its supplier(s). APB shall retain ownership of such
materials, parts, Tooling or other property, and shall extend full permission to
LMI for the proper and intended use of such property in the exclusive execution
of this Agreement. In accordance with the provisions of an Order, but in any
event on completion thereof, LMI shall return such property to APB in the
condition in which it was received except for reasonable wear and tear, and
except to the extent that such property has been incorporated in Products
delivered under such Order or has been consumed in the normal performance of
work under such Order.

      


      22.0               LIMITATION OF
LMI'S RIGHT TO ENCUMBER ASSETS

      


      LMI
warrants to APB that LMI has good title to all inventory, work-in-process,
tools,-equipment and materials to be supplied by LMI in the performance of its
obligations under any Order ("Inventory"),

       

       

      
        
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        and that
pursuant to the provisions of such Order, it will transfer to APB title to such
Inventory, whether transferred separately or as part of any Product delivered
under the Order, free of any liens, charges, encumbrances or rights of others,
provided that LMI reserves the right to physically possess and use all inventory
during the terms of this Agreement.

      

      
23.0               PROPRIETARY INFORMATION AND
MATERIALS

      


      23.1               Protection of
Proprietary Information

      


      As used
in this Agreement:

      


      "Materials"
means any materials containing Proprietary Information.

      


      “Proprietary
Information" means all proprietary, confidential or trade secret information
disclosed by either party to the other or entrusted to either party by a third
party. This information includes, but is not limited to, information relating to
inventions, computer technology and programming, computer software, research,
development, engineering, manufacturing, purchasing, accounting, marketing or
selling. This information may be contained in materials such as engineering and
tool drawings and design, tools and tooling models, samples, electronic and
non-electronic data, specifications, reports, calculation, compilations,
manuals, patent applications or computer programs, whether or not such materials
bear proprietary markings, or tangible items conveying or embodying such
information, or may be in the nature of unwritten knowledge or
know-how;

      


      "Background
Proprietary Information" means any Proprietary Information belonging to a party
which is or was developed prior to or outside of, and not in the course of work
under this Agreement and which is disclosed by either party to the other in the
course of work under this Agreement and includes Background
Inventions;

      


      "Background
Invention(s)" means any invention(s) owned by either party prior to or outside
or not for the purposes of work under this Agreement which becomes or is the
subject of a patent application or issued patent and which is disclosed by
either party to the other in the course of work under this
Agreement;

      


      "Project
Proprietary Information" means any Proprietary Information developed in the
course of work under this Agreement and includes Project
Inventions;

      


      "Project
Invention(s)" means any invention(s) conceived in the course of work under this
Agreement and which becomes the subject of one or more patent
applications.

      


      Each of
APB and LMI shall keep confidential and protect from disclosure to third parties
all Background Propriety Information and Project Proprietary Information of the
other. Except as otherwise provided in this Agreement, neither APB nor LMI shall
disclose to any person, firm or corporation such information of the other party
unless the other party provides its prior written consent.

      


      APB and
LMI shall each use the other party's Background Proprietary Information and
Project Proprietary Information only in the performance of and for the purpose
of this Agreement and/or any

       

       

      
        
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        Order
(consistent with the foregoing, LMI shall not manufacture Products or Spare
Parts for, or sell Products or Spare Parts to, any party other than APB).
Notwithstanding the foregoing and the prior paragraph, APB shall have the right
to use and disclose such information of LMI for the purposes of testing,
certification, use, sale, or support of any Product delivered under this
Agreement, or any airplane including a Product; and provided that APB shall
obtain an appropriate non-disclosure covenant from such receiving
party.

      

      
Upon (i)
either party's request or (ii) in the event of completion, termination or
cancellation of this Agreement, each party shall return, subject to the
provisions of Section 23.1 herein, all Background Proprietary Information and
all Project Proprietary Information of the other party, and all materials
comprising or derived from such information to the other party, unless
specifically directed otherwise in writing by the other party.

      


      Each
party shall not, without the prior written authorization of the other party,
sell or otherwise dispose of (as scrap or otherwise) any parts or other
materials containing, conveying, embodying, or made in accordance with or by
reference to any Background Proprietary Information and Project Proprietary
Information of the other party, provided that this provision is not intended to
prevent APB from selling Products to Customers. Prior to disposing of such parts
or materials as scrap, each party shall render them unusable. Each party shall
have the right to audit the other party's compliance with this Article
23.0.

      


      LMI may
disclose Background Proprietary Information and Project Proprietary Information
of APB to its subcontractors as required for the performance of an Order,
provided that each such subcontractor first assumes, by written agreement to the
benefit of both LMI and APB, the same obligations imposed upon LMI under this
Article 23.0. LMI shall be liable to APB for any breach of such obligation by
such subcontractor.

      


      The
provisions of this Article 23.0 and Section 23.1 are effective in lieu of, and
will apply notwithstanding the absence of, any restrictive legends or notices
applied to the relevant information and shall survive the performance,
completion, termination or cancellation of this Agreement or any
Order.

      


      This
Article 23.0 supersedes and replaces any and all other prior agreements or
understandings between the parties to the extent that such agreements or
understandings relate to obligations of APB or LMI to the other relative to
Background Proprietary Information or Project Proprietary Information,
regardless of whether disclosed to the receiving party before or after the
effective date of this Agreement.

      


      Each
party shall retain exclusive ownership rights in its own Background Proprietary
Information and its own Project Proprietary Information, solely and
independently developed by the party, subject to usage rights, licenses provided
by this Article 23.0.

       

      All
Project Proprietary Information jointly developed by APB and LMI during work
under this Agreement shall be owned as follows:

       

      
        	 
      	
                (i)

              	
                All
      Project Proprietary Information consisting of design and engineering
      documents (including Engineering Drawings and Reports) related to the
      Product, shall belong to APB. LMI hereby assigns all rights it may have in
      such Project Proprietary Information to APB, and LMI shall not use, or
      disclose to any party any such Project Proprietary
      Information;

              


      

       

       

      
        
          
             


          

          
             


            
              

            

          

          
             


          

        

      

      


       

      
        
          	 
      	 
      	
                  Information
      to APB, and LMI shall not use, or disclose to any party any such Project
      Proprietary Information;

                


        

        


        
          	 
      	
                  (ii)

                	
                  All
      other Project Proprietary Information shall be owned by APB. APB agrees to
      assign to LMI a worldwide, non-exclusive, royalty free license to use such
      information.

                


        

        


        
          	 
      	
                  (iii)

                	
                  Notwithstanding
      item (ii) above, any development and/or improvements made to each party's
      Background Proprietary Information will be the retained solely by the
      originating party, will be treated as such party's Background Proprietary
      Information, and is not to be considered Project Proprietary
      Information.

                


        

         

      

      The
restrictions on the receipt and use by each party of the other party's
Background Proprietary Information and the other party's Project Proprietary
Information shall not apply to Proprietary Information which goes into the
public domain through no fault of the receiving party.

      


      23.2               License of
LMI's Background Proprietary Information and Inventions

      


      
        	
                (a)   
      

              	
                LMI
      hereby grants to APB a non-exclusive, royalty-free, worldwide right and
      license, without right of sub-license, (i) to use LMI's Background
      Proprietary Information and Inventions and LMI's Project Proprietary
      Information and Inventions (collectively, "LMI Materials") in connection
      with the development and support of the Product, (ii) to sell, lease,
      transfer, or otherwise convey to third parties the right to use the
      Product acquired from LMI and incorporating LMI's
    Materials.

              


      

      


      
        	
                (b)   
      

              	
                Anything
      to the contrary in this Agreement notwithstanding, if this Agreement is
      terminated by APB pursuant to Article 13.0 or Article 14.0 hereof, APB
      shall have a non-exclusive, royalty-free, worldwide right and license, to
      use LMI Materials to produce the Products by
  itself.

              


      

      


      
        	
                (c)   
      

              	
                If
      APB requires production rates beyond LMI's reasonable ability to achieve
      (i.e.: capacity or labor constraints) APB has the right to secure a second
      source for production and for that purposes shall have the rights under
      (b) and the right sub-license the LMI Materials to a third party to
      produce the Products.

              


      

      


      
        	
                (d)   
      

              	
                Except
      as provided for in this Article 23.0, APB shall have no right to use, nor
      shall APB disclose to any third party, LMI's Background Materials in any
      manner.

              


      

      


      
        	
                (e)   
      

              	
                LMI
      shall execute and deliver, promptly after receiving a request from APB, a
      license agreement in a form and substance satisfactory to APB, acting
      reasonably.

              


      

      


      23.3               Limitation of
License

      


      Background
Proprietary Information and Project Proprietary Information conveyed to a party
under this Agreement are licensed to the receiving party only for the limited
purposes set forth in this Article 23.0. No disclosure of Background Proprietary
Information and Project Proprietary Information will be construed as granting
(i) a license under any patent, patent application, or copyright, or (ii) any
right of ownership in such materials or information.

       

       

      
        
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      24.0               COMPLIANCE WITH
LAWS

       

      24.1               LMI's
Obligation

      


      LMI shall
comply with all laws, including, but not limited to, any statute, rule,
regulation, judgment, decree, order, or permit applicable to its performance
under this Agreement. LMI shall (1) notify APB of any obligation under this
Agreement which is prohibited under applicable law, at the earliest opportunity
but in all events sufficiently in advance of LMI's performance of such
obligation so as to enable the identification of alternative methods of
performance, and (2) notify APB at the earliest possible opportunity of any
aspect of its performance which becomes subject to additional regulation or
which LMI reasonably believes will become subject to additional regulation
during the performance of this Agreement.

      


      24.2               Export
Controls

      


      LMI
acknowledges that all information, drawings, tooling, data, specifications, and
other items provided by APB to LMI, and all products , items, data, drawings,
information, and services made or derived from the same, are subject to U.S. and
other export control laws. In addition to the other limitations and restrictions
contained in this Agreement, LMI agrees that it shall not export, re-export, or
provide access to any such information, drawings, tooling data, specifications,
items, Products or services referred to in the prior sentence to non-U.S.
persons or individuals in violation of U.S. export control laws.

      


      25.0               INTEGRITY IN
PROCUREMENT

      


      APB's
policy is to maintain high standards of integrity in procurement. APB's
employees must ensure that no favorable treatment compromises their impartiality
in the procurement process. Accordingly, APB's employees must strictly refrain
from soliciting or accepting any payment, gift, favor or thing of value, which
improperly influences their judgment with respect to either issuing an Order or
administering this Agreement. Consistent with this policy, LMI agrees not to
provide or offer to provide any employees of APB any payment, gift, favor or
thing of value for the purpose of improperly obtaining or rewarding favorable
treatment in connection with any Order or this Agreement. LMI shall conduct its
own procurement practices and shall ensure that its suppliers conduct their
procurement practices consistent with these standards. If LMI has reasonable
grounds to believe that this policy may have been violated, LMI shall
immediately report such possible violation to the Material
Representative.

      


      26.0               INFRINGEMENT

      


      LMI
represents and warrants that each and every Product, in the form to be delivered
to APB, is and will be free from any known claim for U.S. patent infringement
and that any affixed labels or trademarks are free from any known claim for
copyright or trademark infringement. LMI shall indemnify APB and save it
harmless against such infringement liability based upon APB's possession or
resale, provided that: (i) LMI is promptly notified by APB of any such claim for
such infringement; (ii) such infringement is claimed specifically against the
Product "as delivered" by LMI to APB and unchanged by any acts of APB from such
"as delivered" state; and (iii) such infringement was not a result of use or
sale of the Product in combination with other items and would not have occurred
from the Product by itself. In the event of suit, LMI shall, at LMI's


       

      
        
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      election,
have sole charge and direction thereof, in which event APB shall provide LMI
reasonable assistance in the defense thereof as LMI may require. APB shall have
the right to be represented in such suit by advisory counsel at APB's
expense.

       

      
        	
                27.0

              	
                NOTICES

              


      

      


      
        	
                27.1  

              	
                 

              	
                Addresses

                 

              


      

      
        	
                To
      APB:

              	
                Attention:

              	
                Procurement
      Specialist

              
	 
      	 
      	
                Aviation
      Partners Boeing

                3415
      South 116th
      Street

                Seattle,
      Washington 98168

                Phone:  206-762-1171
      extension xxx

                Fax:       206-242-9347

              
	
                To
      LMI:

              	
                Attention:

              	
                ___________________________

                LMI
      Savannah

                Phone:______________

                Fax:________________

              


      

       

      27.2                      Effective
Date

      


      The date
on which any such communication is received by the addressee is the effective
date of such communication.

      


      27.3               Approval or
Consent

      


      With
respect to all matters subject to the approval or consent of either party, such
approval or consent shall be requested in writing and is not effective until
given in writing. With respect to APB, authority to grant approval or consent is
limited to the Material Representative.

      


      28.0               PUBLICITY

      


      LMI will
not, and will require that its subcontractors and suppliers of any tier will
not, (i) cause or permit to be released any publicity, advertisement, news
release, public announcement, or denial or confirmation of the same, in whatever
form, regarding any Agreement or Order or Products, or the program or Customer
to which they may pertain, or (ii) use, or cause or permit to be used, the APB
name or any APB trademark (or the name or trademark of any affiliate of APB) in
any form of promotion or publicity without APB's prior written
approval.

      


      29.0               RESPONSIBILITY FOR
PERFORMANCE

      


      29.1               Flowdown of
Requirements

      


      LMI shall
be responsible for the requirements of this Agreement and any Order referencing
this Agreement. LMI shall bear all risks of providing adequate facilities and
equipment to perform each Order in accordance with the terms thereof. LMI shall
include as part of its subcontracts those elements of the Agreement which
protect APB's rights including but not limited to right of entry

       

      
        
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APB-LMI-001

          
            

          

        

        
          
          

        

      

       

      provisions,
proprietary information and rights provisions, quality control provisions, and
management and control of APB assets. In addition, LMI shall provide to its
subcontractors sufficient information to clearly document that the work being
performed by LMI's subcontractor is to facilitate performance under this
Agreement or any Order. Sufficient information may include but is not limited to
Order number, ATP description, or the name of the Material
Representative.

       

      29.2               Performance
During Disputes

      


      If a
dispute between LMI and APB arises under this Agreement or any Order, each party
agrees to continue with the performance of the Agreement and any Order under
dispute, including the delivery of Products and payment for Products at the
Order price, pending resolution of the dispute.

      


      29.3               Disputes

      


      In the
event of any dispute over the terms of this Agreement or any Order issued under
this Agreement, LMI and APB shall use its best efforts to resolve the matter
without commencing legal proceedings. Disputes will be settled by individuals
who have been designated by their respective parties. As a prerequisite to legal
proceedings, except in any case in which a party must seek injunctive relief in
order to avoid irreparable harm, any dispute which cannot be settled promptly by
such individuals shall be referred for resolution by an officer or other senior
representative of each of the parties, each of whom shall have the authority to
settle the matter in controversy.

      


      If the
officers or other senior management representatives of the parties to whom any
dispute has been referred for resolution are unable to resolve such dispute
within 30 days of reference of the dispute, or such longer period as the parties
may agree, the dispute shall be resolved through binding arbitration conducted
in accordance with the American Arbitration Association ("AAA"). The AAA shall
administer the arbitration under its procedures and the provisions of this
Article shall govern. Any award rendered by the arbitrator shall be in writing,
set forth the reasons for the award based upon the law, and shall be final and
binding upon the parties. Any judgment upon such award may be entered and
enforced in any court of competent jurisdiction.

      


      29.4               Subcontracting

      


      LMI shall
maintain complete and accurate records regarding all subcontracted items and/or
processes. LMI's use of subcontractors shall comply with LMI's quality assurance
system approval for said subcontractors. No subcontracting by LMI shall relieve
LMI of its obligation under this Agreement or the applicable Order.

       

      Where
required by the requirements of the Order, no raw material and/or material
process may be incorporated in a Product unless: (a) LMI uses a source approved
by APB or (b) APB has surveyed and qualified LMI's receiving inspection
personnel and laboratories to test the specified raw materials an/or material
process. No waiver of survey and qualification requirements will be effective
unless granted by APB's Engineering and Quality Control Departments. Utilization
of an APB-approved raw material source does not constitute a waiver of LMI's
responsibility to meet all specification requirements.

       

      
        
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29.5                      Reliance

      


      APB's
entering into this Agreement is in part based upon APB's reliance on LMI's
ability, expertise and awareness of the intended use of the Products. LMI agrees
that APB and APB's Customers may rely on LMI as an expert, and LMI will not deny
any responsibility or obligation hereunder to APB or APB's Customers on the
grounds that APB or APB's Customers provided recommendations or assistance in
any phase of the work involved in producing or supporting the Products,
including but not limited to APB's acceptance of specifications, test data or
the Products.

      


      29.6               Assignment

      


      In
addition to assignment of any of LMI's rights or obligations under this
Agreement, the following shall be included as "assignments": (i) a consolidation
or merger of LMI; (ii) a change directly or indirectly in the ownership or
voting rights of more than 50% of the issued and outstanding stock of or equity
interest in LMI; (iii) any assignment or transfer of this Agreement by LMI which
would otherwise occur by operation of law, merger, consolidation,
reorganization, assignment, transfer, or other significant change in corporate
or proprietary structure; and (iv) the sale, assignment or transfer of all or
substantially all of the assets of LMI.

      


      LMI shall
notify APB reasonably in advance of any event of assignment.

      


      This
Agreement and each Order shall inure to the benefit of and be binding on each of
the parties hereto and their respective successors and assigns. In the event
that the assignment identified herein reasonably appears to APB to materially
affect the ability of LMI to discharge its obligations under this Agreement, APB
shall be entitled to disapprove of the assignment and in such cases terminate
this Agreement in accordance with Article 14.0.

      


      LMI may
assign claims for monies due or to become due under any Order provided that APB
may recoup or setoff any amounts covered by any such assignment against any
indebtedness of LMI to APB or any claim by APB against LMI, whether arising
before or after the date of the assignment or the date of this Agreement, and
whether arising out of any such Order or any other agreement between the
parties. APB may settle all claims arising out of any Order, including
termination claims, directly with LMI and will not be obligated to deal directly
in any way with LMI's assignee.

      


      30.0               PRODUCT
SUPPORT

      


      30.1                      Policy

       

      APB
provides its Customers with worldwide product support. LMI acknowledges that its
fulfillment of its obligations under this Agreement, including but not limited
to this Article 31.0, is crucial to enable APB to support its
Customers.

      


      30.2               Scope

      


      The
requirements set forth in this Article apply to Products provided by LMI for
installation on Aircraft or for use in the maintenance and operations support of
Aircraft.

       

      
        
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      30.3               AOG
Response

      


      LMI will
employ its best efforts to provide the earliest possible delivery of any Spare
Part designated AOG by APB. Such effort includes but is not limited to working
24 hours a day, seven days a week and use of premium transportation. LMI shall
respond, and when possible, specify the delivery date and time of any such AOG
Spare Part, within four hours of receipt of an AOG Spare Part
request.

      


      30.4               Routine /
Class II Response

      


      LMI shall
expend reasonable business efforts (i.e., excluding overtime, expedite, or
premium efforts) to provide delivery within standard lead-time of any Spare Part
designated Routine (or Class II) by APB. LMI shall respond, and when possible,
specify the delivery date and time of any such Routine Spare Part, within one
business day of receipt of a Routine Spare Part request.

      


      30.5               Designation
by APB

      


      APB will
endeavor to order Spares as Routine or Class II classification; however, in
cases where APB Customers require parts classified as "AOG", APB will so
indicate to LMI and LMI shall perform all duties as required under Section
30.3.

      


      30.6                      Reclassification
or Re-exercises

      


      APB may
from time to time as it considers appropriate instruct LMI to re-prioritize or
reclassify an existing Spare Part Order in order to improve or otherwise change
the established shipping schedule. LMI shall expend the effort required as set
forth above in the definitions of the Spare Part Order to meet the revised
requirement. LMI's commitment of a delivery schedule shall be given in
accordance with that set forth above for the applicable classification, but in
no case shall it exceed 24 hours from notification by APB.

      


      30.7               Spare Parts
Pricing

      


      The price
for all in production spares and details shall be per the latest Bill of
Material kit price for each part. The cost of packaging associated with the
spare is considered part of the Spares price. LMI may charge an appropriate
handling fee for each Spares request, regardless of the number of individual
parts associated with each request. LMI Spares handling fees may be assessed as
follows:

       

      Spares
Requests During Normal Business
Hours                                                                                                    $*                   


      


      Spares
Requests Evenings and
Weekends                                                                                                               $*                   


      


      Out of
production Spares will be priced as mutually negotiated between APB and LMI at
the time of the order.

      


      30.8               Packaging of
Spare Parts

      


      LMI shall
package Spare Parts in accordance with ATA 300. Repairable components shall be
packaged one each in reusable containers. Expendable components shall be
packaged and identified as specified in ATA 300. Styrofoam dunnage such as
pellets, peanuts, popcorn, etc., shall not be utilized.

       

       

       

      
        * The text noted by
asterisks has been redacted in connection with a request to the Securities and
Exchange Commission for confidential treatment of such text pursuant to Rule
24b-2.  A copy of this Agreement including the redacted information has
been submitted to the Securities and Exchange Commission as part of such
request.

      

       

      
        
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30.9               Special
Handling

      


      The price
for all effort associated with the handling and shipment preparation of Spare
Parts is deemed to be included in the price of the Spare Part. Spare Parts shall
be shipped FOB EXW (INCOTERMS 2000) LMI, Savannah. Shipping instructions will be
provided to LMI at time of the Spare Parts order, or as appropriate. If APB
directs delivery of Spare Parts to a delivery point other than EXW LMI, APB
shall reimburse LMI for shipping charges, including insurance, paid by LMI from
the plant to the designated delivery point. Such charges shall be shown
separately on all invoices.

      


      30.10                      
LMI's Spares Point of Contact

      


      LMI shall
provide a point of contact for Spare Part Orders to facilitate prompt order
processing. This point of contact is as follows:

      


      
        	
                Supplier

              	
                Commercial
      Account Manager

              
	
                Phone:

              	
                912-748-8973

              
	
                FAX:

              	
                912/748-9821

              
	
                EMAIL:

              	
                ________________________

              


      

      


      30.11                      Communications
Response Times

      


      LMI shall
respond to communication from APB within the following time
periods:

      


      


      
        	
                Telephone

              	
                Within
      8 hours

              
	
                Wire
      (Telex, etc.)

              	
                Within
      24 hours

              
	
                Letter

              	
                Within
      10 calendar days

              
	
                Request
      for Quotation

              	
                Within
      10 calendar days

              
	
                AOG
      or Routine/Class II

              	
                As
      specified above in Article 13.0

              


      

      


      30.12                      General Product Support
Requirements

      


      30.12.1                   Resolution
of Product Warranty Claims

      


      LMI, on
receipt of a written request for assistance to resolve a product warranty claim,
shall provide a written response to each written notice of a defect submitted
under this Section 31.12 within ten working days from the date of receipt. In
the event LMI disallows any such claim, LMI shall provide a reasonable
explanation of such disallowance to APB and/or Customer.

      


      LMI shall
perform warranty Correction in accordance with Section 12.1 of this Agreement.
LMI shall furnish APB and/or Customer with all the data and information in its
possession relevant to the warranty claim. LMI shall provide to APB and/or
Customer LMI's findings as to the cause of the problem, and upon determination
of an interim or final solution, shall provide to APB and/or Customer a plan and
schedule for Correction.

       

       

      
        
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30.12.2                   Technical
Assistance Requests - Product Manufacture

      


      APB may
request LMI's assistance regarding the Product manufacture, which falls outside
the warranty claim process. Upon request by APB's Program Manager, LMI shall
provide to APB technical assistance pertaining to the manufacture of the
Product. This assistance may be in the form as is reasonably determined by LMI
at the time of the request. LMI shall make best commercially reasonable effort
to support in a timely manner. Any costs or expense incurred by LMI's employees
in providing assistance will be borne by APB.

      


      30.12.3                   Agreement to Manufacture and
Sell

      


      LMI shall
manufacture and sell Spare Parts and Products to APB only, per the terms of this
Agreement.

      


      31.0               TOOLING

      


      A current
Certified Tool List, Attachment C, will be submitted to APB by LMI and updated
each time tools are added or deleted by LMI. The Certified Tool List will
include all program Tooling created to support this contract, including all Tool
Designs, Tool Drawings, NC tapes, Tooling Masters, Soft and Hard Production
Tooling, Assembly Fixtures, Inspection Fixtures and program-specific Shop Aides.
Title to Tooling passes to APB at First Article Delivery for each
program.

      


      The
Tooling identified in the Certified Tool List, Attachment C, shall be capable of
supporting the maximum rate identified.

      


      LMI shall
adhere to the documents listed below, which are incorporated herein and made a
part hereof by this reference, to design, fabricate, validate, control and
maintain all program Tooling:

       

      
        	
                ·

              	
                D33200,
      Supplier Tooling Document

              
	
                ·

              	
                D33011,
      Tool Design Manual

              
	
                ·

              	
                D33181,
      Tool Procedure Manuals

              
	
                ·

              	
                D33041,
      Tool Identification Codes

              
	
                ·

              	
                D32082,
      Trim Tool Document

              
	
                ·

              	
                D32101,
      Plastics Tooling Document

              


      

      


      Notwithstanding
anything contained in this Agreement, if APB declares that an event of default
has occurred, APB may direct LMI to deliver, and LMI will deliver, at no charge
to APB, all Tooling to the location directed by APB and in accordance with the
schedule provided by APB.

      


      32.0               APB-OWNED
TOOLING

      


      In the
event APB furnishes Tooling to LMI, LMI shall comply with the Terms and
Conditions applicable to any Blanket Tooling Purchase Control Order in effect at
the time.

      


      No
replacement or rework of any APB-owned Tooling shall be performed without APB's
prior written consent. APB shall notify LMI of any action required for
discrepant Tooling. LMI will be responsible for routine tool maintenance and
repairs, and replacement of APB-owned Tools shall be for the account of
APB.

       

      
        
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      33.0               STATUS
REPORTS/REVIEWS

      


      When
requested by APB, LMI shall update and submit, as a minimum, monthly status
reports on data requested by APB using a method mutually agreed upon by APB and
LMI.

      


      When
requested by APB, LMI shall provide to APB a manufacturing milestone chart
identifying the major purchasing, planning and manufacturing operations for the
applicable Product(s).

      


      34.0               APB-FURNISHED
MATERIAL AND DATA

      


      A Bonded
Stores Agreement shall be entered into by APB and LMI for any APB furnished
equipment or materials. APB may elect to supply components to LMI for inclusion
into the end item kit BOM, at APB's discretion. Any such components will be
identified and coordinated with LMI prior to delivery of first article machined
parts kits.

      


      APB shall
furnish LMI with all the technical information which is necessary for LMI to
fulfill its responsibility and as set forth in drawings and applicable Technical
Statements of Work in a timely manner.

      


      35.0               INVENTORY AT
CONTRACT COMPLETION

      


      Subsequent
to LMI's last delivery of Product(s), Products which contain, convey, embody or
were manufactured in accordance with or by reference to APB's proprietary
materials including but not limited to finished goods, work-in-process and
detail components (hereafter "Inventory") which are in excess of Order quantity
shall be made available to APB for purchase. In the event APB, in its sole
discretion, elects not to purchase the Inventory, LMI may scrap the Inventory.
Prior to scrapping the Inventory, LMI shall mutilate and/or render it unusable.
LMI shall maintain, pursuant to their quality assurance system, records
certifying destruction of the applicable Inventory. Said certification shall
state the method and date of mutilation and destruction of the subject
Inventory. APB or applicable regulatory agencies shall have the right to review
and inspect these records at any time it deems necessary. In the event LMI
elects to maintain the Inventory, LMI shall maintain accountability for the
inventory and LMI shall not sell or provide the Inventory to any third party
without prior specific written authorization from APB. Failure to comply with
these requirements shall be a material breach and grounds for default pursuant
to Article 14.0.

      


      36.0               CONFIGURATION
CONTROL OF PRODUCTS

       

      After the
issuance of the STC, LMI agrees not to make any change in materials or design
details which would affect the Product or any component part thereof including
without limitation (a) part number identification, (b) physical or functional
interchangeability, or (c) repair and overhaul procedures and processes and
material changes which affect these procedures, without prior written approval
of APB. LMI will place this Article 36.0 clause in all its subcontracts for LMI
identified purchased equipment whether such equipment is supplied to LMI as an
end item or as a component part of an end item.

       

       

      
        
          35

        

        
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37.0               NON-WAIVER

      


      APB's
failure at any time to enforce any provision of an Order or this Agreement does
not constitute a waiver of such provision or prejudice APB's right to enforce
such provision at any subsequent time.

      


      38.0               HEADINGS

      


      Section
headings used in this Agreement are for convenient reference only and do not
affect the interpretation of the Agreement.

      


      39.0               PARTIAL
INVALIDITY

      


      If any
provision of any Order or this Agreement is or becomes void or unenforceable by
force or operation of law, the other provisions shall remain valid and
enforceable.

      


      40.0               APPLICABLE
LAW; JURISDICTION

      


      This
Agreement and each Order, including all matters of construction, validity and
performance, shall in all respects be governed by, and construed and enforced in
accordance only with the law of the State of Washington, without reference to
any rules governing conflicts of law. LMI hereby irrevocably consents to and
submits itself exclusively to the jurisdiction of the applicable courts of the
State and federal courts in Washington for the purpose of any suit, action or
other judicial proceeding arising out of or connected with any Order or the
performance or subject matter thereof. LMI hereby waives and agrees not to
assert by way of motion, as a defense, or otherwise, in any such suit, action or
proceeding, any claim that (a) LMI is not personally subject to the jurisdiction
of the above-named courts, (b) the suit, action or proceeding is brought in an
inconvenient forum or (c) the venue of the suit, action or proceeding is
improper. The U.N. Convention for the International Sale of Goods shall not
apply to this Agreement.

      


      41.0               AMENDMENT

      


      Subject
to the exceptions expressly set forth in this Agreement, oral statements and
understandings are not valid or binding. Except as otherwise provided in
Sections 10.0 and 11.0, no Order may be changed or modified except in writing,
signed by LMI and the Material Representative.

      


      42.0               LIMITATION

       

      LMI may
not (except to provide an inventory of Products to support delivery acceleration
and to satisfy reasonable replacement and Spares requirements) manufacture or
fabricate Products or procure any goods in advance of the reasonable flow time
required to comply with the delivery schedule in the applicable Order except as
otherwise expressly authorized in writing by APB. Notwithstanding any other
provision of an Order, LMI is not entitled to any equitable adjustment or other
modification of such Order for any manufacture, fabrication, or procurement of
Products not in conformity with the requirements of the Order, unless APB's
written consent has first been obtained. Nothing in this Article 43.0 shall be
construed as relieving LMI of any of its obligations under the
Order.

       

      
        
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43.0               LITIGATION

      


      In the
event that any taxing authority has claimed or does claim payment for taxes or
duties, LMI shall promptly notify APB, and LMI shall take such action as APB may
direct to pay or protest such taxes or to defend against such claim. The actual
and direct expenses, without the addition of profit and overhead, of such
defense and the amount of such taxes as ultimately determined as due and payable
shall be paid directly by APB or reimbursed to LMI. If LMI or APB is successful
in defending such claim, the amount of such taxes recovered by LMI, which had
previously been paid by LMI and reimbursed by APB or paid directly by APB, shall
be immediately refunded to APB.

      


      43.1                      Rebates

      


      If any
taxes paid by APB are subject to rebate or reimbursement, LMI shall take the
necessary actions to secure such rebates or reimbursement and shall promptly
refund to APB any amount recovered.

      


      44.0               ENTIRE AGREEMENT / ORDER OF
PRECEDENCE / SURVIVAL

      


      44.1               Entire
Agreement

      


      This
Agreement (including all Orders), sets forth the entire understanding between
APB and LMI with respect to, and supersedes, any and all other prior agreements,
understandings and communications between APB and LMI related to its subject
matter. The rights and remedies afforded to APB pursuant to this Agreement are
in addition to any other rights and remedies afforded by law or
otherwise.

      


      44.2               Incorporated
by Reference

      


      In
addition to the documents previously incorporated herein by reference, the
documents listed below are by this reference made a part of this
Agreement:

      


      Engineering
Drawing by Part Number and, if applicable, related Outside Production
Specification Plan (OPSP).

      


      Any other
exhibits or documents agreed to by the parties to be a part of this
Agreement.

      


      44.3               Order of
Precedence

      


      In the
event of a conflict or inconsistency between any of the terms of the following
documents, the following order of precedence shall control:

      


      1.                Order
(excluding Agreement)

       

      
        2.                Engineering
Drawing by Part Number and, if applicable, related drawing deviations as
requested by Buyer

      

       

      3.                This
Agreement

      


      4.                Any
other exhibits or documents the parties agree shall be part of the
Agreement.

       

       

      
        
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44.4               SURVIVAL

      


      The
provisions of Sections 12.1 (through the terms of the warranty), 12.3, 29.3, and
Articles 17.0, 23.0, 26.0, 27.0, 28.0, 39.0, 40.0, 41.0, 43.0, 44.0, and other
provisions that by their terms survive termination or expiration of this
Agreement, and obligations that have accrued prior to expiration or termination
of this Agreement, shall survive termination or expiration of this
Agreement.

      


      EXECUTED
as of the date and year first written above by the duly authorized
representatives of the parties.

      


      
        	
                APB
      WINGLETS COMPANY, LLC

              	
                LMI
      AEROSPACE, INC.

              
	 
      	 
      
	 
      	 
      
	
                Name:

              	
                Name:

              
	
                Title:

              	
                Title:

              
	
                Date:

              	
                Date:

              


      

       

       

      
        
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    ATTACHMENT
A

    Pricing

     

    (Estimated.
To be updated and finalized pursuant to Section 6.1)

     

    Base
Price

     

    For first
100
Shipsets                                                                                         
    $*                   


     

    Base
Price is the price per Shipset. Prices are estimates until all detail drawings
have been released. Firm pricing based on released engineering will be finalized
pursuant to Section 6.1 of this Agreement.

     

    Pricing
identified above is the kit price per Shipset, exclusive of nonrecurring costs.
APB's Order to LMI shall indicate part number(s) required for each Shipset of
Products.

     

    Nonrecurring
Price

     

    Total
Nonrecurring
Costs                                                                                     $*                   


     

    Nonrecurring
Price (amortized over 100
Shipsets)                                            $*                   


     

    Prices
are estimates until all detail drawings have been released. Firm pricing based
on released engineering will be finalized pursuant to Section 6.1 of this
Agreement.

     

    Spares
Pricing

     

    Spare
parts will be priced according to Article 31.0, Product Support.

     

     

     

    
      * The text noted by
asterisks has been redacted in connection with a request to the Securities and
Exchange Commission for confidential treatment of such text pursuant to Rule
24b-2.  A copy of this Agreement including the redacted information has
been submitted to the Securities and Exchange Commission as part of such
request.

    

    

      
        
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APB-LMI-001  

          
            

          

        

        
           


        

      



    ATTACHMENT
B

     

    Rates
& Factors

     

    The
following rates and factors will be used on all price change negotiations during
the period of performance of this Agreement.

     

    
      	
              Production
      Labor:

            	
              $
      *                   
      /hour

            
	
              (includes
      direct labor rate of $ *                   
      /hour, Labor burden of *                   
      %, G&A, and profit

            
	
              Direct
      Engineering Labor Rate

            	
              N/A

            
	
              Material
      Burden:

            	
              *                   
      %

            
	
              G&A

            	
              *                   
      %

            
	
              Profit

            	
              *                   
      %

            


    

    


     

     

    
      * The text noted by
asterisks has been redacted in connection with a request to the Securities and
Exchange Commission for confidential treatment of such text pursuant to Rule
24b-2.  A copy of this Agreement including the redacted information has
been submitted to the Securities and Exchange Commission as part of such
request.

    

     

    

      
        
          40 


        

        
          Master Agreement No.
APB-LMI-001  

          
            

          

        

        
           


        

      



    ATTACHMENT
C

    Certified
Tooling List

     

    (to be
provided by LMI once APB-owned tooling is complete and accepted by APB
QA)

     

    
      	
                 Tool
    Number

            	
                 Nomenclature

            	
                 Tool Code

            	
                 Unit No.

            	
                 Location

            
	
              XYZ

            	
              Holding
      Fixture

            	
              HF

            	
              1

            	
                 Savannah

            


    

    


     

     

    

      
        
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          Master Agreement No.
APB-LMI-001